INTRODUCTION

The European Communities appeals certain issues of law and legal interpretations developed in the Panel Report, Brazil – Measures Affecting Imports of Retreaded Tyres (the “Panel Report”). The Panel was established to consider a complaint by the European Communities concerning the consistency of certain measures imposed by Brazil on the importation and marketing of retreaded tyres with the General Agreement on Tariffs and Trade 1994 (the “GATT 1994”).

Before the Panel, the European Communities claimed that Brazil imposed a prohibition on the importation of retreaded tyres, notably by virtue of Article 40 of Portaria No. 14 of the Secretaria de Comércio Exterior (“SECEX”) (Secretariat of Foreign Trade of the Brazilian Ministry of Development, Industry, and Foreign Trade), dated 17 November 2004 (“Portaria SECEX 14/2004”), and that this prohibition was inconsistent with Article XI:1 of the GATT 1994. The European Communities also contended that certain Brazilian measures providing for the imposition of fines on the importation of retreaded tyres, and on the marketing, transportation, storage, keeping, or warehousing of imported retreaded tyres, were similarly inconsistent with Article XI:1 or, alternatively, Article III:4 of the GATT 1994. In addition, the European Communities made claims under Article III:4 of the GATT 1994 in respect of certain state measures prohibiting the marketing of, and/or imposing disposal obligations on the importers of, imported retreaded tyres. Finally, the European Communities challenged the exemption from the import prohibition on retreaded tyres and associated fines provided by Brazil to retreaded tyres originating in countries of the Mercado Común del Sur (“MERCOSUR”) (Southern Common Market). The European Communities contended that these exemptions were inconsistent with Articles I:1 and XIII:1 of the GATT 1994.

Brazil did not contest that the prohibition on the importation of retreaded tyres and associated fines were prima facie inconsistent with Article XI:1; or that state measures prohibiting the marketing of, and/or imposing disposal obligations on the importers of, imported retreaded tyres were prima facie inconsistent with Article III:4; or that the exemptions from both the import prohibition and associated fines afforded to retreaded tyres imported from MERCOSUR countries were prima facie inconsistent with Articles I:1 and XIII:1 of the GATT 1994.