The government last month banned the New Atlantia -- described by Greenpeace as hazardous in its global list of toxic ships -- after a Bangladeshi ship breaker imported it under the name of MT Enterprise.

But that decision was reversed this week after a government inspection did not find any excessive hazardous materials, as described by Greenpeace.

Iqbal Kabir, of the Bangladesh Environmental Lawyers' Association, told AFP his group filed a petition to the high court seeking the ban to stay in place, which was upheld late Wednesday.

"The high court has ruled that the ship cannot be harboured and dismantled in Bangladesh."

The tanker is moored off the port of Chittagong and was due to be taken to Sitakundu, on the country's southeastern coast, to be dismantled.

The vessel was now expected to leave Bangladeshi shores, Kabir said.

Up to 130 large ships are dismantled each year on beaches at Sitakundu -- home to the world's largest ship breaking yards -- 30 kilometres (18 miles) north of Chittagong city.

Sitakundu's breaking yards have experienced a boom in recent years due to soaring demand for steel.

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