Tasmanian salmon giant Huon Aquaculture has lost its Federal Court battle against rivals Tassal and Petuna and the Commonwealth over salmon numbers in Macquarie Harbour, reports MSN.

Huon Aquaculture challenged the 2012 decision to allow salmon farming expansion in the harbor, arguing it was invalid and had led to environmental degradation.

Rival companies Petuna and Tassal were parties to the case, and supported the minister's decision.

Duncan Kerr, judge of the Federal Court of Australia, dismissed Huon Aquaculture's application and ordered it pay legal costs.

The decision comes after an announcement in March by Tasmania's Environment Protection Authority (EPA) of a dramatic reduction of allowable salmon stocks in Macquarie Harbour.

Following the verdict, Frances Bender, executive director of Huon Aquaculture said while the company had lost the case, she believed it had been a catalyst for change in the salmon industry.

"Today is a moral victory if not a legal one," Bender said.

"It has been a tough, uncomfortable and very public process for all involved but I firmly believe these proceedings have been a catalyst for positive change for our industry."

Aquaculture

Huon loses legal battle with Tassal, Petuna over Macquarie Harbor