In a preliminary opinion, the court found the Government was wrong to take a case against Britain to a UN tribunal.
Instead, it sided with the European Commission who took Ireland to court insisting the Government should have informed and consulted it first.
Foreign Affairs Minister Dermot Ahern said the opinion would not deflect the Government’s efforts against Sellafield.
“Today’s event isn’t the end of the situation,” he said.
The Attorney General is considering the opinion, which says that because the EU is a signatory to the UN Convention on the Law of the Sea and because Ireland’s case involved EU law, it should first have referred the case to the commission.
Politicians, furious with the opinion, have accused the commission of operating double standards in its dealings with nuclear plants.
Dublin MEP Proinsias De Rossa said he was dismayed that the commission took the case against Ireland.
He accused the Energy Commission of double standards when it comes to the nuclear industry, as 15 months after deciding to refer Britain to the court for failing to comply with legislation relating to Sellafield, it had still not done so.
A spokesperson for the commission said the proceedings were being prepared and Britain would be referred to the court shortly.
Sinn Féin’s Bairbre de Brún said she was dismayed that the European Commission chose to take action against the Irish Government.