WT/DS135/R
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Organization
WT/DS135/R
18 September 2000
(00-3353)
EUROPEAN COMMUNITIES –
MEASURES AFFECTING ASBESTOS AND ASBESTOS – CONTAINING PRODUCTS
Report of the Panel
The report of the Panel on European Communities – Measures Affecting Asbestos and Asbestos – Containing Products is being circulated to all Members, pursuant to the DSU. The report is being circulated as an unrestricted document from 18 September 2000 pursuant to the Procedures for the Circulation and Derestriction of WTO Documents (WT/L/160/Rev.1). Members are reminded that in accordance with the DSU only parties to the dispute may appeal a panel report. An appeal shall be limited to issues of law covered in the Panel report and legal interpretations developed by the Panel. There shall be no exparte communications with the Panel or Appellate Body concerning matters under consideration by the Panel or Appellate Body.
Note by the Secretariat: This Panel Report shall be adopted by the Dispute Settlement Body (DSB) within 60 days after the date of its circulation unless a party to the dispute decides to appeal or the DSB decides by consensus not to adopt the report. If the Panel Report is appealed to the Appellate Body, it shall not be considered for adoption by the DSB until after the completion of the appeal. Information on the current status of the Panel Report is available from the WTO Secretariat.
WT/DS135/R
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WT/DS135/R
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TABLE OF CONTENTS
Page
I.INTRODUCTION...... 1
II.FACTUAL ASPECTS...... 3
A.Basic data concerning asbestos...... 3
B.Decree No. 96-1133 of 24 December 1996 banning asbestos...... 3
III.ARGUMENTS OF THE PARTIES...... 5
a.claims by the parties...... 5
b.factual arguments...... 6
1.Introductory remarks...... 6
2.Economic and trade data...... 10
3.French legislation in its context...... 12
4.Circumstances of exposure to asbestos and asbestos-related pathologies...... 22
5.“Controlled” or “safe” use of chrysotile asbestos...... 53
6.Substitute fibres for chrysotile...... 72
7.The INSERM report...... 86
C.legal arguments...... 98
1.Agreement on Technical Barriers to Trade (“TBT” Agreement)...... 99
(a)Applicability of the TBT Agreement...... 99
(b)Article 2.1 of the TBT Agreement...... 106
(c)Article 2.2 of the TBT Agreement...... 108
(i)Legitimate objective...... 108
(ii)“For this purpose, technical regulations shall not be more trade-restrictive than necessary to fulfil a legitimate objective, taking account of the risks non-fulfilment would create …” (Article 2.2, second sentence) 109
(d)Article 2.4 of the TBT Agreement...... 135
(e)Article 2.8 of the TBT Agreement...... 146
2.General Agreement on Tariffs and Trade (GATT)...... 147
(a)Applicability of Article III and/or Article XI of the GATT...... 147
(b)Article III:4 of the GATT...... 152
(i)Application of Article III:4 of the GATT...... 152
(ii)The concept of “like products”...... 153
(iii)Imported products … shall not be subject to less favourable treatment...... 168
(c)Article XI of the GATT...... 171
(d)Article XX(b) of the GATT...... 174
(i)Nature of Article XX and the burden of proof...... 174
(ii)Policy to protect human health...... 175
(iii)“… necessary to protect human health and life …”...... 175
(iv)Preamble to Article XX...... 182
(e)Article XXIII:1(b) of the GATT...... 184
IV.ARGUMENTS PRESENTED BY THIRD PARTIES...... 194
A.Brazil...... 194
1.Introduction...... 194
2.Factual Aspects...... 197
3.Legal Aspects...... 203
(a)The Agreement on Technical Barriers to Trade...... 203
(i)Article 12 of the TBT Agreement...... 203
(ii)Article 2.2 of the TBT Agreement...... 203
(iii)Article 2.4 of the TBT Agreement...... 208
(iv)Article 2.8 of the TBT Agreement...... 209
(b)The General Agreement on Tariffs and Trade...... 210
(i)Article XI of the GATT...... 210
(ii)Article III of the GATT and Article 2.1 of the TBT Agreement...... 210
(iii)Article I of the GATT and Article 2.1 of the TBT Agreement...... 211
(iv)Article XX of the GATT...... 212
B.United states...... 212
1.Introduction...... 212
2.Factual Aspects...... 213
3.Legal Aspects...... 220
(a)The General Agreement on Tariffs and Trade...... 220
(i)Article XI of the GATT...... 220
(ii)Article III of the GATT...... 220
(iii)Article XXIII:1(b) of the GATT...... 221
(b)The Agreement on Technical Barriers to Trade...... 222
(i)Article 2.1 of the TBT Agreement...... 223
(ii)Article 2.2 of the TBT Agreement...... 223
(iii)Article 2.4 of the TBT Agreement...... 224
C.Zimbabwe...... 224
1.Introduction...... 224
2.Factual Aspects...... 225
3.Legal Aspects...... 228
(a)The Agreement on Technical Barriers to Trade...... 228
(b)The General Agreement on Tariffs and Trade...... 231
(i)Article III of the GATT...... 231
(ii)Article XX of the GATT...... 233
V.PANEL'S CONSULTATION WITH SCIENTIFIC EXPERTS...... 236
A.determination of the procedure...... 236
B.Selection of experts...... 244
C.questions by the panel and comments by the scientific experts...... 245
1.Introductory Comments by Dr. Henderson...... 245
(a)Introduction...... 245
(b)Malignant mesothelioma – Introduction and general observations on asbestos and mesothelioma 246
(c)Spontaneous or background mesothelioma: does it exist?...... 252
(d)Magnitude of the mesothelioma problem...... 254
(e)Some general observations on approaches to risk assessment on society and on epidemiological studies of asbestos-related cancers 255
(f)General observations on induction of mesothelioma by asbestos, especially the amphibole varieties of asbestos such as crocidolite and amosite 259
(g)Commercial Chrysotile and Mesothelioma Induction...... 266
(h)Other Chrysotile-Exposed Cohorts and Studies...... 270
(i)Abestos and Lung Cancer...... 274
(j)Some General Observations on Experimental Models of Asbestos Carcinogenesis, including invivo and in vitro Systems 282
2.Questions by the Panel and Comments by the Scientific Experts...... 284
3.Summary Comments by Dr. Henderson...... 336
4.Endnote by Dr. Henderson...... 339
D.comments by the parties on the responses from the experts...... 340
1.Canada...... 340
2.The European Communities...... 370
E.Supplementary remarks from dr. henderson...... 372
1.Concerning the comments from the European Communities...... 372
2.Concerning the comments from Canada...... 372
(a)Lung cancer rate among South Carolina (Charleston) chrysotile textile workers versus the Quebec chrysotile miners/millers 375
(b)The question of a threshold for the carcinogenicity of chrysotile (lung cancer and mesothelioma 380
(c)The feasibility in practice of "controlled use" of chrysotile asbestos...... 381
(d)Are substitute fibres safer than chrysotile?...... 384
(e)Summary...... 388
VI.submissions from non-governmental organizations...... 390
VII.interim review...... 391
A.introduction...... 391
B.comments by canada...... 391
C.comments by the european communities...... 393
VIII.Findings...... 395
A.summary of the facts at the origin of this dispute and claims by the parties...... 395
1.Measure at the origin of the dispute...... 395
2.Main claims by the parties...... 397
(a)Main claims by Canada...... 397
(b)Main claims by the European Communities...... 397
B.issues on which the panel had to take a position during the procedure...... 397
1.Introduction...... 397
2.Consultation of experts...... 398
3.Amicus curiae briefs...... 399
C.order in which the panel examined the claims...... 400
D.applicability of the tbt agreement to the decree...... 401
1.Arguments of the parties and approach adopted by the Panel...... 401
(a)Arguments of the parties concerning the applicability of the TBT Agreement to the Decree401
(b)Approach followed by the Panel...... 402
(i)Criteria for the application of the TBT Agreement...... 402
(ii)Differentiation among the prohibitions as such and the exceptions...... 403
2.Is the Decree a technical regulation within the meaning of the TBT Agreement?....404
(a)Examination of the part of the Decree prohibiting the marketing of asbestos and asbestos-containing products 404
(i)Preliminary remarks...... 404
(ii)Analysis...... 405
Ordinary meaning of the terms in the definition in Annex 1 to the TBT Agreement...... 405
Object and purpose...... 406
Context...... 408
(iii)Additional arguments by Canada...... 410
(b)Analysis of exceptions and the effect of the type of exceptions on the findings concerning prohibitions 411
(i)The exceptions in the Decree constitute technical regulations...... 411
(ii)Effect of the legal characterization of the exceptions on the legal characterization of the prohibitions 412
3.Conclusion...... 413
E.Application of the gatt 1994 to the decree...... 413
1.Preliminary questions...... 413
(a)The effect of practice within the GATT 1947 and the WTO...... 413
(b)Burden of proof...... 414
(c)Application of Article III:4 and/or Article XI of the GATT 1994...... 415
(i)Question before the Panel...... 415
(ii)Analysis...... 415
2.Violation of Article III of the GATT 1994...... 419
(a)Arguments of the parties...... 419
(b)Issues raised in connection with the arguments of the parties relating to Article III:4 of the GATT 1994 420
(c)The Panel's approach to product-by-product analysis and certain specific aspects of the burden of proof. 420
(d)Analysis of likeness...... 422
(i)Introductory remarks...... 422
(ii)Likeness of asbestos fibres and substitute fibres...... 423
Properties, nature and quality of the products...... 423
End-use...... 427
Consumers' tastes and habits...... 427
Tariff classification...... 428
Conclusion...... 429
(iii)Likeness between products containing asbestos and certain other products...... 429
(e)Less favourable treatment of Canadian products...... 430
(f)Conclusion...... 431
3.Violation of Article XI of the GATT 1994...... 431
4.Applicability of Article XX of the GATT 1994...... 432
(a)Arguments of the parties...... 432
(b)Approach adopted by the Panel and burden of proof...... 433
(i)Introductory remarks concerning the approach adopted by the Panel...... 433
(ii)Burden of proof...... 435
General considerations...... 435
Considerations specific to the burden of proof as regards the scientific aspects...... 435
(c)Application of Article XX(b) of the GATT 1994 to the Decree...... 436
(i)"Protection of human life and health"...... 436
(ii)"Necessary"...... 440
The ban on chrysotile asbestos in its various forms...... 440
Recourse to substitute fibres and products...... 445
(d)Application of the introductory clause (chapeau) of Article XX of the GATT 1994 to the application of the Decree 446
(i)"Means of arbitrary or unjustifiable discrimination between countries where the same conditions prevail" 446
(ii)"Disguised restriction on international trade"...... 448
5.Conclusion...... 450
F.allegation of nullification or impairment of a benefit under
article xxiii:1(b) of the gatt 1994...... 450
1.Arguments of the parties...... 450
2.Analysis by the Panel...... 452
(a)Preliminary issues...... 452
(i)Questions before the Panel...... 452
(ii)The EC's argument according to which the rules on non-violation nullification apply only if the measure in question does not fall under other provisions of the GATT. 454
(iii)The EC's argument according to which there cannot be a "legitimate expectation" in the case of a measure that concerns the protection of human health. 456
(b)Examination of the substantial aspects of Canada's arguments under
Article XXIII:1(b) of the GATT 1994...... 458
(i)Burden of proof...... 458
(ii)Examination of the conditions...... 459
(c)Conclusion...... 464
IX.CONCLUSIONS...... 465
WT/DS135/R
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I.INTRODUCTION
1.1In a communication dated 28 May 1998, Canada requested consultations with the EuropeanCommunities (EC) pursuant to Article XXII of the General Agreement on Tariffs and Trade (GATT), Article 11 of the Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement) and Article 14 of the Agreement on Technical Barriers to Trade (TBT Agreement), concerning certain measures taken by France for the prohibition of asbestos and products containing asbestos (WT/DS135/1 – G/SPS/GEN/72 – G/TBT/D/15). Canada’s request states that these measures include, but are not limited to, Decree No. 96-1133 of 24December 1996 (the “Decree”) banning asbestos, issued pursuant to the Labour Code and the Consumer Code, as amended. On 12June 1998, Brazil asked to take part in the consultations because of its substantial trade interest (WT/DS/135/2).
1.2In a communication dated 8 October 1998, Canada informed the Dispute Settlement Body (DSB) that the consultations held with the EC had failed to resolve the dispute satisfactorily. Consequently, Canada requested the DSB to establish a panel to examine the French measure concerning the prohibition of asbestos and products containing asbestos. In its communication, Canada claimed that the Decree, as well as any other measure which Canada might indicate, were inconsistent with Articles 2 and 5 of the SPS Agreement, Article 2 of the TBT Agreement, Articles III and XI of the GATT 1994, and, under Article XXIII:1(b) of the GATT 1994, nullified or impaired one or several advantages accruing to Canada directly or indirectly under the WTO Agreement or impeded the attainment of an objective of the Agreement owing to the fact that the banning of asbestos by France was applied whether or not it conflicted with the Agreement (WT/DS/135/3).
1.3At its meeting held on 25 November 1998, the DSB established a panel pursuant to Canada’s request. At that meeting, the parties to the dispute agreed that the Panel should have the following terms of reference:
“To examine, in the light of the relevant provisions of the covered agreements cited by Canada in document WT/DS135/3, the matter referred to the DSB by Canada in that document and to make such findings as will assist the DSB in making the recommendations or in giving the rulings provided for in those agreements".
1.4On 29 March 1999, the parties to the dispute agreed that the Panel would be constituted as follows (WT/DS135/4):
Chairman: Mr. Adrian Macey;
Members: Mr. William Ehlers;
Mr. Åke Lindén.
1.5Brazil, the United States and Zimbabwe reserved their rights as third parties to the dispute, in accordance with Article 10 of the Dispute Settlement Understanding.
1.6The Panel met with the parties on 1 and 2 June 1999 and with third parties on 2 June 1999. A meeting with scientific experts was held on 17 January 2000. The second substantive meeting with the parties was held on 20 January 2000.
1.7In a communication dated 27 September 1999, the Chairman of the Panel informed the DSB that the Panel was unable to present its report within the six-month period provided in Article 12.8 of the Memorandum of Understanding. The reasons for the delay are set out in document WT/DS/135/5. In two subsequent communications dated 7 March 2000 and 28 June 2000 respectively, the Chairman of the Panel informed the DSB that the Panel would require more time to complete its report (WT/DS135/6 and WT/DS135/7).
1.8The Panel transmitted its interim report to the parties on 13 June 2000. Its final report was submitted to the parties on 25 July 2000.
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II.FACTUAL ASPECTS
A.Basic data concerning asbestos
2.1Asbestos is a “fibrous mineral of hydrated silicates”[1] which can be divided into two groups: amphiboles and serpentine. There are five varieties of asbestos within the amphibole group: anthophyllite, amosite (or brown asbestos), crocidolite (or blue asbestos), actinolite, and tremolite. The serpentine group comprises only chrysotile (or white asbestos). These varieties of asbestos have different physical and chemical properties.
2.2It is mainly amosite, crocidolite and chrysolite which are exploited for industrial and commercial purposes. The special qualities of asbestos fibres (for example, resistance to very high temperatures and to different types of chemical attack) due to their particular physical and chemical properties have meant that they have been put to many uses, for example, for the manufacture of industrial and consumer products and in the building industry.
B.Decree No. 96-1133 of 24 December 1996 banning asbestos
2.3On 24 December 1996, the French Government adopted Decree No. 96-1133 banning asbestos, issued pursuant to the Labour Code and the Consumer Code (décret no. 96-1133 relatif à l’interdiction de l’amiante, pris en application du code de travail et du code de la consommation)(hereinafter “the Decree”)[2]. The Decree entered into force on 1 January 1997. The following are its principal provisions:
2.4Article 1 provides for a ban on asbestos in the following terms:
“I. – For the purpose of protecting workers, […] the manufacture, processing, sale, import, placing on the domestic market and transfer under any title whatsoever of all varieties of asbestos fibres shall be prohibited, regardless of whether these substances have been incorporated into materials, products or devices.
II. – For the purpose of protecting consumers, […] the manufacture, import, domestic marketing, exportation, possession for sale, offer, sale and transfer under any title whatsoever of all varieties of asbestos fibres or product containing asbestos fibres shall be prohibited […].”
2.5Article 2 of the Decree allows some exceptions to the ban in Article 1.
“I. – On an exceptional and temporary basis, the bans instituted under Article 1 shall not apply to certain existing materials, products or devices containing chrysotile fibre when, to perform an equivalent function, no substitute for that fibre is available which:
-On the one hand, in the present state of scientific knowledge, poses a lesser occupational health risk than chrysotile fibre to workers handling those materials, products or devices;
-on the other, provides all technical guarantees of safety corresponding to the ultimate purpose of the use […].”
2.6The exceptions allowed are the subject of an exhaustive list prescribed by the French authorities and reviewed annually (Article 2.II). Any exception under Article 2 must be the subject of a declaration by the head of the business establishment, the importer or the party responsible for domestic marketing of a product covered by Article 2; the purpose of the declaration is to be able to determine that the activity to which it refers meets the criteria set out in the first paragraph of the Article, taking into account scientific and technological progress (Article 3).
2.7Article 4 contains requirements on the levels of exposure to be respected when manufacturing or processing products covered by Article 2[3], as well as their labelling and marking.[4] Article 5 lays down penalties (fines) for breaches of the Decree’s provisions.
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III.ARGUMENTS OF THE PARTIES
a.claims by the parties
3.1In view of the facts and arguments put forward, Canada requests the Panel to find that:
(a)Decree No. 96-1133 of 24 December 1996 banning asbestos is incompatible with the Agreement on Technical Barriers to Trade insofar as it is a technical regulation that:
(i)Creates an unnecessary obstacle to international trade contrary to the provisions of Article 2.2;
(ii)is not based on effective and appropriate international standards – nor is it in compliance with them – contrary to the provisions of Article 2.4;
(iii)is not based on orders relating to chrysotile and chrysotile-containing products with respect to the product performance of chrysotile, contrary to the provisions of Article 2.8; and
(iv)violates the national treatment disciplines and the most-favoured-nation clause of Article 2.1.
(b)In addition, the Decree is incompatible with the GATT 1994 in that it:
(i)Creates a prohibition or a restriction on the import of chrysotile and chrysotile-containing products, contrary to the provisions of Article XI.1; and
(ii)favours the national industry of products like chrysotile fibre and chrysotile-cement products, contrary to the national treatment disciplines of ArticleIII:4.
3.2In the event that the Panel is unable to find a violation of Article XXIII.1(a) of the GATT 1994, Canada requests that the Panel find a violation of Article XXIII.1(b) of the GATT 1994.
3.3In view of the foregoing, Canada requests that the Panel recommend to France that it make the Decree compatible with its obligations under the Agreement on Technical Barriers to Trade and the GATT 1994.
3.4In view of the facts and legal arguments, the European Communities (hereinafter the "EC") ask the Panel to confirm that, in light of the rules of the GATT 1994, Decree No. 96-1133 of 24December 1996 banning asbestos:
(i)Should not be examined in relation to the scope of Article XI of the GATT 1994;
(ii)does not establish less favourable treatment for similar imported products than for domestic products, within the meaning of Article III:4 of the GATT 1994;
(iii)is necessary in any event, to protect human health, within the meaning of ArticleXX(b) of the GATT 1994.
3.5The EC also ask the Panel to find that:
(i)The Decree is not covered by the Agreement on Technical Barriers to Trade and that, in any case, it complies with the relevant provisions of that Agreement.
3.6Finally, the EC further ask the Panel to find that:
(i)Article XXIII.1(b) of the GATT 1994 does not apply.
3.7Consequently, the EC ask the Panel to reject all the arguments put forward by Canada.