At a session of the WTO's dispute settlement body, Brazilian diplomats asked the global body to establish a panel of experts to formally certify that the United States had not implemented the March 2005 ruling.

That ruling had said that Washington's payouts to producers were an illegal subsidy which skewed international trade by undermining global cotton prices.

Brazil claimed that the United States had not gone far enough when it recently repealed a controversial subsidy programme, and alleged that other forms of support remained in place.

The United States on Friday blocked the Brazilian request, saying it was "without basis" -- a step allowed under the rules of the 149-nation WTO, which sets the framework for global commerce.

Brazilian diplomats said that they would try again at another dispute settlement meeting later this month, a move which could launch a tortuous procedure at the WTO.

If the panel is eventually set up, it would have three months to deliver its verdict.

If the panel were to decide that Washington was still violating international trade rules, Brazil could then ask the WTO to authorise retaliatory customs duties against a swathe of US goods.

Brazil had previously asked for the right to impose sanctions worth 4.0 billion dollars (3.0 billion euros), but the request was put on ice during the complex WTO arbitration process that led to last year's ruling.

On August 2, the United States announced that it had formally repealed its so-called "Step 2" cotton subsidy

In the wake of the March 2005 WTO decision, Brazil had reached a deal with Washington, giving the United States time to adapt its legislation.

Following the collapse at the end of July of wider WTO talks on reforming global commerce, West African countries that are heavily reliant on the crop for their export earnings warned they may launch their own legal challenge over the US cotton subsidies.

According to US government figures, the subsidies excluding federal insurance guarantees for farmers stood at 3.1 billion dollars (2.4 billion euros) for the 2005 crop year. That was down from 3.7 billion (2.9 billion euros) for 2004.