The case involves tariffs that former U.S. President Donald Trump imposed in 2018 on washing machine imports, as part of his "America First" trade push.

The measures were designed to shield Whirlpool Corp and other U.S. appliance manufacturers from a surge in imports, mainly from South Korean rivals Samsung Electronics and LG Electronics.

The two Korean firms filed a complaint to the World Trade Organization the same year, claiming the so-called "safeguard measures" discriminated between products originating in South Korea and comparable products from other WTO members.

The panel upheld Seoul's claim that the U.S. International Trade Commission (USITC) failed to show increased imports of washing machines, a normal condition for safeguards, as well as Seoul's challenge to a U.S. price analysis. It dismissed others such as allegations that Washington had failed to send timely notifications to the WTO.

"Korea welcomes that the Panel upheld Korea's claims in all five substantive issues," a statement from South Korea's trade ministry said, adding it would make efforts to resolve the matter with Washington as early as possible.

Adam Hodge, a spokesman for the U.S. Trade Representative's office, said the WTO panel had rejected South Korea's claims on certain aspects of serious injury and on the form of the safeguard measure.

However, some of its findings illustrated a USTR concern that WTO panels "may follow past Appellate Body reports and not apply WTO rules as they are written," Hodge said in an emailed statement.

"We will continue to carefully review the report and consider next steps as appropriate."

Washington may appeal the findings. However, since there is no current functioning Appellate Body at the WTO due to a U.S.-led blockade on judge appointments, this would join a growing number of cases in a legal void.

"We continue to support the position taken by the USTR in defense of the safeguard and disagree with the WTO panel's conclusions," said a spokesperson for Whirlpool, noting that the tariffs would stay in place until a final determination is made.

The U.S. tariffs were due to expire in 2021 but Trump extended them for another two years in one of his last acts on trade in his presidency.

The WTO was due to settle the case around the same time but the ruling was delayed due to a lack of expertise and difficulties holding meetings amid COVID rules, according to the WTO website.

(Reporting by Emma Farge and Philip Blenkinsop; additional reporting by David Lawder; Editing by David Gregorio, Nick Macfie and Richard Pullin)

By Emma Farge and Philip Blenkinsop