The appeals court of Den Bosch, in the southern Netherlands, found two owners of the Victoria cafe in Breda, near the Belgian border, not guilty of having contravened the ban.

'The court finds that the (ban) is partly non-binding, as it lacks legal grounding' regarding establishments with no staff, said a court statement.

The ban on smoking in the hotel, restaurant and catering industry had sought to protect staff from the dangers of second-hand smoke inhalation.

'This is a huge boost for (small establishments) to get back to business,' said Joris Prinssen, a spokesman for industry association Koninklijke Horeca Nederland, in reaction to the judgement.

Court spokesman JJ van der Kaaden told AFP that Tuesday's ruling would apply to all small cafes and bars that employed no staff. But its application was frozen by an announcement by prosecutors that they intended appealing the verdict in the Supreme Court. This could last 18 months.

'Today's decision will not be formal until confirmed by the Supreme Court,' said Mr Kaaden. 'But one can imagine that courts asked to consider similar cases in the interim, would be unwilling to make any findings until the outcome of that appeal is known.'

The owners of the Victoria cafe were first acquitted by a lower court last month, escaping prosecution demands for a 1,200 euro (S$2,386) fine and closure for a month. The prosecution appealed the finding.

The cafe is run by the owners with no other employees.

Several thousand small bars and cafes in the Netherlands united late last year to flaunt the smoking ban and create a joint legal defence fund, arguing they lacked the floor space and money to erect separate smoking-only areas. -- AFP