. /.   WORLD TRADE  
ORGANIZATION  WT/DS332/9 
4 September 2007 
 (07-3724) 
 Original:   English 
  
 
BRAZIL – MEASURES AFFECTING IMPORTS OF RETREADED TYRES 
 
Notification of an Appeal by the European Communities
 
under Article 16.4 and Article 17 of the Understanding on Rules  
and Procedures Governing the Settlement of Disputes (DSU),  
and under Rule 20(1) of the Working Procedures for Appellate Review  
   The following notification, dated 3 September 2007, from the Delegation of the European Commission, is being circulated to Members. 
 
_______________ 
 
 1. Pursuant to Article 16.4 and Article 17 of the DSU and to Rule 20.1 of the Working 
Procedures for Appellate Review, the European Comm unities submits its Notice of Appeal on certain 
issues of law covered in the Report of the Panel on Brazil – Measures Affecting Imports of Retreaded 
Tyres
1 and certain legal interpretati ons developed by the Panel. 
 
2. The European Communities seeks review by the Ap pellate Body of the following aspects of 
the Report of the Panel: 
(a) The Panel's finding that the import ban on retreaded tyres was necessary within the 
meaning of Article XX(b) of the GATT.  The Panel's finding and corresponding 
reasoning are contained in pa ragraphs 7.103 to 7.216 of the Panel Report. The EC 
appeals this finding notably because: 
- in assessing the contribution of the measure to the protection of human, 
animal and plant life and health, the Panel merely assesses whether the ban is 
capable of making a potential contribution to its stated objectives. This 
reasoning is inconsistent with Article  XX(b) of the GATT. Moreover, in 
reaching its conclusion regarding the pot ential contribution of the ban, the 
Panel also fails to make an objective assessment of the matter before it, including of the facts of the case, as required by Article 11 of the DSU, and 
effectively shifts the burden of proof to the EC;  
- in assessing the reasonably available al ternative measures, the Panel wrongly 
excludes some of the alternatives propo sed by the European Communities, on 
the basis that those alternatives are re lated to the manner in which the import 
ban is implemented in practice , that they are not necessarily readily available, 
that they do not avoid the waste tyres arising specifically from imported 
retreaded tyres, that they already exist in  Brazil, or that they are individually 
                                                     
 
1 WT/DS332/R, circulated on 12 June 2007. WT/DS332/9 
Page 2  
 
  capable of disposing only of a small number of waste tyres. Moreover, the 
Panel has ignored important facts and arguments presented by the European Communities, has referred to the evid ence submitted by the parties in a 
selective and distorted manner, and has e ffectively shifted the burden of proof 
to the EC. These findings are inconsistent with Article XX(b) of the GATT 
and with the Panel’s duty to make an objective assessment of the matter 
before it, including of the facts of the case, as required by Article 11 of the DSU; 
- contrary to Article XX (b) of the GATT,  the Panel has erred by not carrying 
out a process of weighing and balancing the relevant factors and elements 
(objective pursued, trade-restrictiven ess of the measure, contribution and 
alternatives); 
(b) the Panel’s finding that the exemption, from the import ban and other challenged 
measures, of imports of retreaded tyr es from other Mercosur countries does not 
constitute arbitrary or unjustifiable discrim ination (paragraphs 7.270 to 7.289 of the 
Panel Report). This finding is  inconsistent with the chapeau of Article XX of the 
GATT; 
(c) the Panel’s finding that the imports of used tyres do not constitute arbitrary 
discrimination and that they constitute unj ustified discrimination only to the extent 
that they significantly undermine the obj ectives of the ban (paragraphs 7.292 to 
7.294, 7.296 and 7.306 of the Panel Report) . This finding is inconsistent with the 
chapeau of Article XX of the GATT; 
(d) the Panel’s finding that the Mercosur exemption does not constitute a disguised 
restriction on international trade, and that  imports of used tyres would constitute a 
disguised restriction only to the extent that they significantly undermine the objectives of the ban (paragraphs 7.347 to 7. 355 of the Panel Report). This finding is 
inconsistent with the chapeau of Article XX of the GATT; 
(e) the Panel's decision to exercise judicial economy with respect to the European 
Communities' claims under Articles XIII:1 a nd I:1 of the GATT (paragraphs 7.453 to 
7.456 and 8.2 of the Panel Report). Since the Panel found that the Mercosur exemption is not incompatible with the chapeau of Article XX GATT, a separate 
finding on the compatibility of this exem ption with Articles XIII:1 and I:1 GATT 
would have been necessary to secure a positiv e resolution of the dispute, as required 
by Articles 3.3, 3.4, 3.7 and 11 of th e DSU. The European Communities therefore 
asks the Appellate Body to find that the Me rcosur exemption is incompatible with 
Articles XIII:1 and I:1 of the GATT, and is not justified either by Article XXIV or by 
Article XX(d) of the GATT. 
 
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