A bakery in Northern Ireland has lost an appeal over its refusal to make a cake for a gay rights group.

The Christian-run Ashers Bakery in Belfast refused to bake a cake with a pro-gay marriage slogan on it in 2014 and was fined stg£500 (€700).

Gareth Lee had asked the bakery to ice a cake depicting 'Sesame Street' characters Bert and Ernie and the logo for the campaign group, Queerspace.

Northern Ireland's publicly funded Equality Commission brought a civil action, alleging that the bakery breached its statutory duty not to discriminate on the grounds of sexual orientation.

A court ruled Mr Lee was discriminated against on the grounds of sexual orientation.

The cake in question that Gareth Lee asked for | File photo

Judge Brownlie said at the time she believed the family who run the bakery had "genuine and deeply held religious beliefs" but said they must have been aware Mr Lee was gay and were aware of the ongoing same-sex marriage debate.

She added: "They (Ashers) are in a business supplying services to all. The law requires them to do just that."

The bakery appealed the ruling, which was today dismissed.

The Court of Appeal in Belfast upheld an earlier finding that the shop unfairly discriminated against customers by refusing to bake the cake.

The judges ruled that baking the cake did not necessarily mean endorsing its message, and that bakers could not choose customers according to their religious beliefs.

Speaking outside court, bakery owner Daniel McArthur praised God, and said they still stand by their decision.

Michael Wardlow from Northern Ireland's Equality Commission does not believe the decision infringes religious beliefs.