L'Oreal is the world's largest cosmetics producer
Online marketplace eBay is not jointly liable for the sale of any counterfeit L'Oreal products through its website, the High Court in London has ruled.
While eBay claimed victory, L'Oreal said the court agreed that eBay could do more to stop trademark infringement.
The court referred points of law to the European court for clarification.
This is the latest in a string of court cases around Europe, as the French luxury goods group tries to stop the sale of counterfeit goods.
The High Court called on eBay to demand sellers disclose names and addresses, take greater account of negative feedback from users, filter listings and restrict volumes of high-risk products, such as fragrances, L'Oreal said.
The court also referred parts of European trade mark law and the eCommerce directive to the European Court of Justice for clarification.
L'Oreal said it remained "confident of a positive outcome".
eBay welcomed the ruling.
"This is an important judgment because it ensures that consumers can continue to buy genuine products at competitive prices on eBay," said Richard Ambrose, eBay's head of trust and safety.
"We reiterate again that co-operation and dialogue is what is needed, not litigation. Only by working together can we collectively address the issues that concerns eBay, rights owner and consumers."
L'Oreal lost a similar case in France last week and is appealing against a defeat in Belgium.
It has similar legal proceedings against eBay continuing in Germany and Spain.