The World Trade Organization (WTO) has ruled to uphold a ban imposed by South Korea on Japanese fish products as a result of the Fukushima nuclear disaster in 2011.
Fishery products from the prefectures of Miyagi, Iwate, Aomori, Ibaraki, Tochigi, Gunma and Chiba have all been banned in South Korea since a powerful earthquake and subsequent tsunami triggered a meltdown at the nuclear plant eight years ago.
The government in Seoul has also ordered that inspections be carried out on other Japanese foods for fear they may be contaminated with radioactive substances.
In May 2015, the Japanese government filed a complaint with the WTO to argue that such a ban restricted free trade and did not have any basis in science.
Initially, the WTO supported the Japanese appeal, but its appellate body has now overruled this and decided the ban can still stand, the Japan Times reports.
The governing body said Japan has failed to demonstrate that its waters are the same as those in South Korea and that its fishery products are therefore safe for consumption.
It means the ruling will be finalised by the WTO settlement body within a month and South Korea's ban on imports of 28 species of fish will be maintained.
South Korea's government has welcomed the decision, but the situation is likely to have a significant and negative impact on Japan as it continues to reconstruct the areas affected by the 2011 disaster.
It could also have implications outside South Korea, as 23 countries or regions currently have import restrictions in certain Japanese food products.
Indeed, China had only begun to ease its restrictions on Japanese food imports last year, but may now reconsider based on the WTO ruling.
On the other hand, nations including Australia and the US have acted to lift their own restrictions as the impact of Fukushima's meltdown starts to recede and experts deem food products fit for consumption.