The 20-year-old Shingler, born in Wales, was picked by Scotland for the Six Nations on the understanding that he qualified through his Scottish-born mother. But the IRB said in March that Shingler played in 2010 for Wales Under-20s, which was designated as Wales' second national team at the time.
Scotland argued that Shingler never signed a declaration tying his international eligibility to Wales, but lost its appeal by a unanimous decision of the IRB on Tuesday.
The IRB has told unions to publicly publish their second team designation annually and ensure all players are informed.
Shingler's brother Aaron made his debut for Wales against Scotland in the Six Nations.