MEPs have voted to reject a ban on bottom-fishing trawlers, which environmentalists say lead to the destruction of the deep-sea.
The European Parliament in Strasbourg voted down the propsed ban by 342 votes to 326.
It followed a compromise deal struck by the Conservative and Socialist groups to regulate the practice more closely in vulnerable areas.
Bottom fishing with heavy trawl nets scoops up everything on the seabed.
It is said this destroys fragile ecosystems such as coral reefs which are home to a wide variety of species.
The practice is used by France and Spain, which opposed the ban.