The Socialists, the second biggest party in parliament, voted overwhelmingly against the plans, and even some in the conservative European People's Party, the biggest grouping, voted to reflect their skepticism at the proposal

Liberals in the 732-seat assembly originally voiced support for the principle of freeing up competition, but said the current proposal was misguided.

"I am in favor of a general liberalization of markets and port services, but I cannot support this proposal," said liberal Josu Ortuondo Larrea.

Deputies from all political parties in the European parliament had lined up earlier in the week to denounce the plans as threatening dock workers' jobs by opening up ports to more competition, including from companies outside the European Union.

"I believe this text belongs in the dockside rubbish container, and I hope that is where it will end up after we reject it," said socialist Willi Piecyk on Tuesday. "I haven't heard a single argument which justifies endangering these jobs," he added.

Rejected plan had been amended from last vetoed draft