The disposal of tyre waste is a worldwide health and environmental problem, and both the European Communities and Brazil are trying to minimize the impact of tyre waste on their environment and the health of their people. Retreading tyres in order to extend their usable life is one way of contributing to diminishing the tyre disposal problem. Trade in retreaded tyres, however, generally increases the health and environment problems in the importing State, as retreaded tyres cannot be retreaded again and have a shorter life-span. Given the serious implications of tyre waste for the propagation of mosquitoes and associated diseases like malaria and dengue fever, and given the difficulties of safely disposing of the hazardous and persistent chemicals in tyres, countries should retain the ability of banning entry of short-life retreaded tyres that threaten their environment and the health of their people.
The Panel concluded that Brazil’s import prohibition is necessary within the meaning of Article XX(b). To reach this determination, the Panel analyzed, inter alia, the risks associated with tyre waste, the measure’s capabilities to address such risks, and potential alternatives to the import prohibition. The Panel’s analysis is anchored in WTO text and jurisprudence, and it follows accepted methodologies of treaty interpretation. In the end, the Panel’s reasoning and holding make an important contribution to reconciling what at times are competing interests in trade and the environment.