BRAZIL – MEASURES AFFECTING IMPORTS OF RETREADED TYRES
Document: 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
Date: 4 September 2007
Document codes: WT/DS332/9
Complainant: EU
Respondent: Brazil
Third parties: Argentina, Australia, China, Cuba, Guatemala, Japan, South Korea, Mexico, Paraguay, Taiwan, Thailand, U.S.
Dispute stage: Appellate Body
Agreements cited: Art. I:1, III:4, XI:1, XIII:1  GATT 1994

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.

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
1 and certain legal interpretations 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.

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.