The European Court of Human Rights (ECHR) said Tuesday Britain had failed to protect potential victims of child trafficking in a case dating back to 2009, and breached two articles relating to the prohibition of forced labor and the right to a fair trial.
The court ordered Britain to pay 25,000 euros in damages and 20,000 euros for costs and expenses to each of the applicants, who are now in their 20s.
The British government has three months to decide whether to appeal the ruling at the ECHR's grand chamber.
Britain's Home Office (interior ministry) said in statement that it was "carefully considering" the judgment.
"The government is committed to tackling the heinous crime of modern slavery and ensuring that victims are provided with the support they need to begin rebuilding their lives," it said.
Anti-slavery advocates welcomed the ruling and said it could affect the treatment of victims in other European nations.
"It's actually a game changer on the rights of all victims of trafficking to protection," said Parosha Chandran, a barrister who represented one of the two applicants in the case.
"This judgment will count for many victims today, tomorrow and in many years to come," she added.
In its ruling, the Strasbourg-based court outlined how the two Vietnamese applicants - referred to as V.C.L. and A.N. - were discovered working on cannabis farms in Britain in 2009, and charged with drugs offenses to which they pleaded guilty.
Following their conviction, the two teenagers were detained in young offenders' institutions before later being recognized by British authorities as victims of human trafficking.
However, prosecutors ultimately concluded that they had not been trafficked and Britain's Court of Appeal ruled that the decision to prosecute them had been justified, the ruling said.
But the ECHR said prosecutors did not give clear reasons to challenge the classification of the two Vietnamese as victims of trafficking, and that the Court of Appeal had only addressed whether the decision to prosecute had been an abuse of process.
The lack of any assessment of whether the applicants had been trafficked may have prevented them from securing important evidence capable of helping their defense, the ruling said.
The United Kingdom thus violated Article 4 - prohibition of forced labor - and Article 6 - right to a fair trial - under the European Convention on Human Rights, according to the ECHR.
A record 10,627 suspected modern slaves were identified in Britain in 2019 - up by 52 percent in a year - while the Covid-19 pandemic has pushed the crime further underground with victims less likely to be found or receive help, according to activists.
Police, lawyers and campaigners have raised concerns that children are often prosecuted on drug charges despite evidence suggesting they were coerced, and a legal defense protecting such defendants under Britain's 2015 Modern Slavery Act.
"This case overwhelmingly proves identification is key for child victims of trafficking, particularly if they are caught up in criminal exploitation," said Anna Sereni, coordinator of the Anti-Trafficking Monitoring Group, a coalition of charities.
"We're glad that the ECHR acknowledged the importance of protecting children through principles of non-punishment and non-prosecution," she told the Thomson Reuters Foundation.