Cardiff resident Ed Bridges challenged the technology after spotting scanning security cameras in his area. Bridges' attorneys argued during a hearing in May it violates British data protection and equality laws.
The majority of judges on the High Court of Cardiff ruled Wednesday that while facial recognition interferes with privacy rights, the technology in the hands of police has a lawful and legal basis.
"We are satisfied both that the current legal regime is adequate to ensure appropriate and non-arbitrary use of [automated facial recognition] ... and [police] use ... has been consistent with the requirements of the Human Rights Act and the data protection legislation," Lord Justice Charles Anthony Haddon-Cave said in the ruling.
Police records showed the department has been using facial recognition for heavily-attended events like sports games and air shows. The cameras scan faces in the crowd and compare them to images in a police database of wanted individuals, alerting a command center when there is a match.