Yellow Fever at the WTO

A WTO dispute panel recently rendered an important decision on the right of a developing country to ban imports of products that promote the spread of mosquito-borne diseases such as yellow fever, malaria, and dengue. Although it dealt with the prosaic issue of the importation of tires, the case represents a useful precedent outlining the measures that a country can take to combat serious health and environmental risks.

Brazil imposed an import ban on retreaded tires, arguing that such tires have a short useful life and that when improperly disposed of provide the perfect breeding ground for disease-carrying mosquitos. Brazil also argued that the accumulated tires release toxic chemicals and heavy metals into the environment. The European Union took issue with this import ban, and challenged it before the WTO. So in essence, the EU and Brazil were litigating about what Brazil could and could not do under the WTO rules to fight malaria, yellow fever, and the toxic disposal of tires.

The WTO panel concluded that there were health risks associated with short-life span tires and that an import ban could contribute to the reduction in the number of such tires. Typically a WTO will not allow a Member State to impose a measure that violates WTO rules if there are alternative approaches that are less trade restrictive. The EU argued that Brazil could have taken other less trade restrictive measures to combat malaria and yellow fever, namely improve the management of waste tires and reduce the total number of waste tires.

The WTO has often rendered decisions that require a Member State to take a less trade restrictive approach that is also dramatically less effective at achieving the desired result. For example, when Thailand wanted to curb tobacco use, the WTO ruled that an advertising ban was a less trade restrictive—but of course far less effective—approach that could be used instead of an import ban on tobacco.

But in this case the WTO panel wisely recognized that such measures were cumulative in nature. “[T]he positive impact of both measures—i.e., the ban on imported short-lifespan retreaded tyres and domestic measures on domestic tyres—could be cumulative rather substitutable. We thus do not agree with the European Communities that the institution of domestic measures … would achieve the same outcome as the import ban on retreaded tyres…. [I]t is clear … that in addressing [these] risks … a combination of measures may be appropriate, so that the question of a specific measure’s justification does not necessarily present itself in terms of simple alternatives or the replacement of one specific measure by another, as it is possible that different measures may address different aspects of the same risk and complement each other towards addressing the risk.” (¶¶ 7.169, 7.213).

The second major part of the decision worth highlighting is that the WTO panel found Brazil’s efforts to be impermissible under Article XX unless it also took similar measures with respect to used tires. “[A]llowing used tyres to be imported … runs directly counter to this premise [of import bans of second-life tyres] as it effectively allows the very used tyres that are prevented from entering into Brazil after retreading to be imported before retreading. (¶ 7.295). The suggested solution was to impose a similar ban on used as well as retreaded tires.

As Joost Pauwelyn argues, the reasoning of the WTO panel decision suggests that “Brazil essentially lost the case because it should have been MORE trade restrictive. The Panel basically found … that if Brazil is serious about the risks of waste tyres, it should not only ban imports of retreaded tyres but also imports of used tyres. This makes a lot of sense. But it underscores how WTO dispute settlement can lead to less (rather than more) trade and, more importantly, how [Article XX] forces WTO members to engage in sound environmental policies. In that sense, the WTO has truly become an environmental treaty with Art. XX as a catch-all obligation to engage in sound and reasonable environmental policies.” I agree with Joost to the extent that the WTO panels view measures as cumulative rather than substitutable. But otherwise the result often will be less trade restrictive measures that are also less effective environmental or health measures.

As a final note, to my knowledge this is the first time that developed countries have challenged before the WTO the health and environmental measures imposed by a developing country. Reading the 400-page opinion, I could not help but feel a sense of frustration that the European Union was not showing greater respect and deference to the reasonable efforts Brazil was taking to fight major illnesses such as malaria and yellow fever. Some of the arguments appeared to display more concern about the European retread tire industry than the health and environmental risks those products are causing for Brazil. Wouldn’t the EU be better served through a joint partnership between developed and developing countries to devise a workable solution to fight malaria and yellow fever? One cannot help but be struck by U.S. court litigation seeking to improve the labor conditions of rubber plantation workers in Liberia, while the European Union is actively pursuing litigation to undermine the health and welfare of consumers of rubber products in Brazil.