The lower court's recommendation is not binding on the Supreme Court, which will decide the appeal. But for the appeal to succeed, the Supreme Court would have to overturn its earlier decision upgrading their sentences to death.
Fairfax journalist Mark Forbes reported in today's Sydney Morning Herald that the three judges who heard the appeal have prepared a report rejecting legal arguments used by convicted heroin traffickers Matthew Norman, Si Yi Chen and Tan Duc Thanh Nguyen.
The newspaper said it had seen a copy of the report, which stated: "In our opinion the judicial review request is DISMISSED."
The Denpasar judges reportedly found the Supreme Court had the right to impose the death penalty even though prosecutors had requested a maximum of life imprisonment.
They said the original penalties were not proportional to the crime and "therefore the panel of judges sees no errors have been made".
"Drug-related crimes are considered as an extraordinary anti-social act," the judges found.
They also said international drug trafficking was included in "the most serious crime and deserved the death penalty".
Erwin Siregar, one of the lawyers for the three men, told the Australian Broadcasting Corporation (ABC) that the the Supreme Court did not have to take the opinion into account.
The ABC reported he said it was not good news for his clients, but the Supreme Court was totally independent.
"The judges' court, when they make a decision, nobody can influence them," he said.
"They are free to make a decision."
Background
In May 2007, Si Yi Chen, 22, Matthew Norman, 20 and Thanh Duc Tan Nguyen, 24, appeared in Bali's Denpasar District Court for hearings into their judicial review.
Written submissions lodged by their lawyers argued the Supreme Court did not consider the full facts of the cases when it changed their sentences from 20 years to death.
Related stories:
Bali 9 challenge may win and fail -- 03 June, 2007
Drug penalty violates international law -- 06 May, 2007
Australians appeal Bali death sentences -- 02 May, 2007
Firing squad for six of Bali nine -- 10 September, 2006
Bali 9 death sentence confirmed -- 26 April, 2006
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