Ruling on a case brought by the European Commission three years ago, the European Court of Justice determined that the French republic had shown a lack of due care towards its dwindling population of the black-bellied rodents.
Wild European hamsters, which can live for four years and grow to more than 20 cm (8 inches) in length, are considered farmland pests, but are threatened with extinction in their small habitat in Alsace, eastern France.
The court found France had allowed harmful crops and unchecked urbanisation to destroy nearly 1,000 hamster burrows between 2001 and 2007.
"The court holds that the measures to protect the European hamster in Alsace, implemented by France, were not adequate" to protect the species, it said a statement, adding that France needed to address the situation immediately.
Under the ruling, France must adjust its agriculture and urbanisation practices or face daily fines from the European Union. As the European Court of Justice is the EU's highest court, France has no further right of appeal.
There are an estimated 800 wild European hamsters left in France, although there are plentiful populations elsewhere on the continent.
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