BA said it could not have foreseen the invasion

The seven former hostages said the stop in Kuwait City was made in order to drop off British special forces troops as Saddam Hussein's forces were bombarding the emirate.

But BA and the British Government have always denied that accusation.

The airline says the stopover was scheduled and was for refuelling and the invasion of Kuwait was an act of war that could not be foreseen.

BA has expressed sympathy for the former hostages but says it was not responsible for what happened to them, the BBC's Caroline Wyatt in Paris says.

BA, in deciding to maintain the stopover... has gravely failed in its obligations and must be ordered to pay compensation Court ruling

But the French court disagreed, ruling that "the invasion of Kuwait by Iraq seemed to have been highly predictable".

It said the company "gravely failed in its obligations and must be ordered to provide compensation", the French news agency AFP reported.

The London-to-Kuala Lumpur flight landed in Kuwait City on 2 August 1990.

The city was in the midst of an invasion and passengers were moved to a hotel when the airport came under bombardment.

Human shield

The flight was carrying nearly 400 passengers and crew.

Many were taken hostage by Iraqi forces and forced to act as human shields.

Some were held for as long as five months.

BA officials said they were surprised by Thursday's ruling and would examine their options.

But our correspondent says the company may have nowhere else to turn.

In 1996, a Paris court ordered BA to pay about $4.3m to 65 French passengers in connection with the same incident.