The Luxembourg-based court sided with Sweden, which had sued the commission, the EU's executive arm, for having failed to set criteria to identify endocrine disrupting chemicals (EDCs) by a December 2013 deadline.
ECDs are found in thousands of products -- including disinfectants, pesticides and toiletries -- which have been linked to cancers, birth defects and development disorders in children.
"By failing to adopt measures concerning the specification of scientific criteria for the determination of endocrine-disrupting properties, the Commission has breached EU law," the court ruled.
An appeal may be brought before the Court of Justice, the highest court, against the ruling within two months.
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The Swedish government immediately hailed the general court's ruling, saying: "The important task of identifying and phasing out endocrine disrupting substances need to get started."
Sweden as well as European health and environment groups have argued that the Commission has bowed to pressure from the chemical industry, which is insisting on a consultation and more analysis before setting criteria, despite calls from scientists and the European Parliament for urgent action.
A study in the Journal of Clinical Endocrinology and Metabolism has linked EDCs to IQ loss, autism, attention hyperactivity disorder, obesity, testicular cancer and male infertility.
Hundreds of EDCs are present in food products, textiles, hygiene products, toys, cosmetics and plastic bottles.
EDCs include diethylstilbestrol (DES), polychlorinated biphenyls (PCBs), dioxins, perfluoroalkylcompounds, solvents, phthalates, bisphenol A (BPA), organophosphate and organochlorine pesticides, and polybrominated diphenyl ethers (PBDE).