1.

JAPAN – MEASURES AFFECTING THE IMPORTATION OF APPLES

Fireblight, known by its scientific name as Erwinia Amylovora, is a bacterium that renders
infected apples inedible and unmarketable, causing them to shrivel up and discolour. Japan is a
fireblight-free country and is particularly sensitive to the serious effects that would follow from
the establishment of fireblight in host plants in Japan. To combat the risk of introducing
fireblight, Japan has applied strict phytosanitary measures to imported apple fruit. A set of ten
requirements were imposed as measures by Japan on United States apple fruit. Designated
fireblight-free orchards timely inspections of such orchards, strict inspection of the authorities
for checking fire-blight , both before and during harvest, disinfection of the harvest and cautious
packaging processes, separation of the fruit destined for Japan, a dual certification process of U.S
officials and Japanese officials.

 The WTO Proceedings

The main argument put forward by the United States was that the apples it exported to Japan
were all mature symptomless apples, and that, biologically, no risk of transmitting fireblight was
associated with mature symptomless apples. Examining the scientific evidence, the Panel
concluded that there was only a negligible risk that fireblight would be introduced to Japan via
mature symptomless apples. Apples other than mature, symptomless apples might carry some
risk. However, even if apples other than mature, symptomless apples were exported to Japan, the
introduction of fireblight would require an unlikely sequence of events. In the light of such
findings, the Panel concluded that there was not sufficient scientific evidence that apple fruit
were likely to serve as a pathway for the entry, establishment or spread of fire blight in Japan.

Accordingly, the Panel found that Japan’s SPS measure was inconsistent with article 2.2 of the
SPS Agreement because it was maintained without sufficient scientific evidence. The Panel
made a provisional finding to this effect, which the Panel confirmed subsequently after finding
the measure was not justified as a temporary measure within the terms of article 5.7. The Panel
also found that Japan’s measure was inconsistent with article 5.1 of the SPS Agreement, because
it was not based on a risk assessment. Japan’s Pest Risk Analysis did not meet the requirements
of a risk assessment under article 5.1. The Panel added that Japan had nullified or impaired
benefits accruing to the United States under the SPS Agreement.The Appellate Body upheld the
Panel’s findings on the provisions of the SPS Agreement.

 The Proportionality test and the Precautionary Principle

While it may appear on the surface merely to have been another complex quarantine case, the
Japan-Apples Case raised a number of issues of importance in relation to the extent of WTO
members’ rights to protect themselves against risks to human, animal and plant life and health
within their jurisdiction. These included the question whether there is a role for a proportionality
test in this field of law, as well as how the precautionary principle may apply and how the burden
of proof should be allocated in cases involving scientific uncertainty. A careful balance between
requirements for SPS measures to have a scientific basis and recognition of national regulatory
autonomy is established to bean integral part to WTO biosafety. dispute settlement

In this case, Japan failed to establish that its measure was a ‘provisional measure’ justified under
article 5.7 of the SPS Agreement as it has failed in qualifying the significant criteria- A measure
be imposed in respect of a situation where ‘relevant scientific evidence is insufficient’.

 The Scientific Evidence Rule

The Panel focused observed that there was a large quantity of high-quality scientific evidence
and the ground that the relevant scientific evidence in this case was insufficient was a baseless
argument as a matter of law. Further, it emphasized on the precautionary principle (Principle 15
of the 1992 Rio Declaration) which exhorts that the states should to postpone environmental
action on the basis of lack of full scientific certainty where there are threats of serious or
irreversible damage. Therefore, the WTO members cannot abandon their obligations pertaining
to the Precautionary approach under the SPS Agreement. Further, against the usual rules on
burden of proof, the panel observed that it is not fair for the party seeking to defend itself against
threats to the life or health of its population or flora and fauna to have to carry the burden of
proof in litigation challenging any provisional measures it might take for this purpose. This is a
welcome step towards the flexibility of the adjudicating processes in the interests of biosafety.

2. THE ASBESTOS CASE

Against a milieu of the protection human health, namely the health of workers, the French
government, which had previously imported large amounts of chrysotile asbestos, adopted a
decree, which banned the import and use of asbestos and asbestos products. The Decree provided
that for the purpose of protecting workers, the manufacture, 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. Secondly, the Decree provided that with some limited exceptions, for the
sake of protecting consumers, the manufacture, import, domestic marketing, exportation, and
possession for sale, offer, sale and transfer under any title whatsoever of any product containing
asbestos fibres shall be prohibited.

 The WTO proceedings

On 8 October 1998, Canada requested the establishment of a panel, which was established on 25
November of the same year. Canada moved to challenge the ban at the WTO on behalf of its
Quebec-based asbestos industry, which is the world’s second largest producer and the largest
exporter of chrysotile asbestos. Canada argued that the Decree violated the provisions of the
TBT Agreement. And nullified or impaired benefits under GATT. The European Communities
justified its prohibition on the grounds of human health protection, arguing that asbestos was
hazardous not only to the health of construction workers subject to prolonged exposure, but also
to the population subject to occasional exposure. Specifically, the EC argued that the TBT
Agreement did not cover the Decree. With regard to GATT 1994, the EC requested the panel to
confirm that the Decree was either compatible with Article III or necessary to protect human
health within the meaning of Article XX(b).

 The WTO Panel Findings

The panel observed that the Decree violated Article III:4 in that it afforded ‘less favourable’
treatment to imported products than to ‘like’ domestic products. However, it held that the
French ban could be justified as the experts consulted confirmed the health risks associated with
exposure to chrysotile asbestos in its various uses. With regard to whether the measure
constituted a ‘disguised restriction on international trade’, the panel extensively relied on the
Appellate Body decision in the US Gasoline case, and opined that ‘disguised restriction’ 28
‘conceals’ the pursuit of trade-restrictive objectives, which is not the case in the dispute.

 The Decision of the Appellate body

On appeal, Canada disputed two aspects of the panel’s findings: whether the use of chrysotile
cement products posed a risk to human health and whether the measure at issue was ‘necessary
to protect human life or health’. The EC had also appealed the panel’s findings that chrysotile
asbestos fibres and PVA, cellulose and glass fibres (‘PCG fibres’) are ‘like products’ under
GATT Article III:4 and the finding of the panel that ‘less-favourable treatment’ was accorded to
imported asbestos and asbestos-containing products than to domestic ‘like products’ contrary to
Article III:4. The Appellate Body reviewed the panel’s findings that cement-based products
containing chrysotile asbestos fibres are ‘like’ cement based products containing PCG fibres.
The Appellate Body found that the panel’s reasoning was insufficient to support a finding of
‘likeness’ and it failed to take into account the ‘risk’ associated with the product; it failed to
examine consumer tastes and habits, and it did not properly examine how the incorporation of
the different types of fibre in the product affects end-users.

Having reversed the panel’s findings that the products at issue were ‘like’ products, and
emphasizing on the importance of preserving the health interests of the public from the bio and
biotechnological products which are potentially harmful, the Appellate Body consequently
reversed the panel’s conclusion that the measure was inconsistent with GATT Article III:4.

 The Principle of Scientific Certainty and the Sovereign’s Right to protect the Health
Interests of the Public

The Appellate Body has specifically emphasized the importance of the scientific evidence and
the rationale off scientific certainty in tackling bio safety issues. However, the Appellate Body
stated that while the panel in this case followed the view of the majority scientific opinion, a
panel is not required to follow, in every instance, the majority scientific opinion. The Appellate
Body rejected Canada’s claim that the panel erred by consulting particular experts stating that the
expert selection process was carried out properly, Canada never objected to the selection of the
experts. In this case, the Appellate Body went out of its way to emphasize the sovereign right of
each WTO member to maintain a strict level of precaution against health risks. This decision is
very important because it dealt with the leading known cause of occupational cancer in human
populations all over the world, and one of the most thoroughly studied toxic dusts ever breathed.

3. THE AUSTRALIAN SALMON CASE

In 1975, Australia imposed a ban on imports of fresh salmon under a quarantine regulation
intended to prevent entry of imported diseases into fish stock in Australia. Australia did allow
imports of non-fresh salmon, including salmon that had been heat-treated by canning 
or smoking, which reduces the risk of disease. In 1995, the annual value of such imports to
Australia was about 52 million dollars, with almost half of these imports coming from
Canada. Australian salmon had an advantage in Japanese and other markets, selling for
premiums up to 20 percent over other imported fresh salmon, because of Australian
environmental regulations. In the 1990s, however, tensions arose between Canada and Australia
over Australia's regulation, negatively affecting the two countries' relations. The Australians
argued that the ban was justified on health grounds; the Canadians argued that there was no
scientific evidence that Canadian fresh-salmon imports would be unsafe and that the ban was
simply protectionism.

 WTO Proceedings

The case formally began with Canada's request for consultations on October 1995. Canada
alleged that Australia's prohibition on Canadian salmon imports under the Australian quarantine
regulation was inconsistent with the SPS Agreement and articles XI and XIII of the
1994 General Agreement on Tariffs and Trade (GATT). Following requests from Canada to
establish a panel, the DSB did so in April 1997. The European Communities, India, Norway, and
the United States reserved their third-party rights. The panel was composed in May 1997, and the
panel report circulated in June 1998. The panel determined that Australia's important ban was
"inconsistent with the provisions of the of the SPS Agreement, and also nullified or impaired
benefits accruing to Canada under the SPS Agreement."

 Decision of the Appellate Body

In June 1998, Australia filed a notice of its intention to appeal the panel's decision to the
WTO Appellate Body.   The Appellate Body reversed the panel with respect to its reasoning on
Articles 5.1 and 2.2 of the SPS Agreement, but found that Australia “had acted inconsistently”
with several provisions of the SPS agreement directed Australia not only to lift the ban on
Canadian salmon, but also the quarantine requirements for several other species of fish. DSB
accepted the decision and made recommendations to the parties accordingly. Australia expressed
its intention to abide by the decision. In December 1998, Canada requested arbitration to
determine the reasonable period of time for implementation of the recommendations. The
Arbitration Report was circulated in February 1999; it determined that the reasonable period of
time for implementation was eight months.

 The 1999 Import Risk Analysis and the Report of the Compliance panel

After Canada brought this dispute to the WTO, Australia published the “1999 Import Risk
Analysis” arguing that the import of frozen, fresh or chilled salmon is a health risk. In 1999,
Canada made requests under the DSU for a determination by the original panel of whether the
implementation measures taken by Australia were consistent with WTO rules as determined in
the dispute-resolution proceedings. At its meeting of 28 July 1999, the DSB agreed to take up
Canada's request and referred the matter back to the original panel. The EC, Norway and the U.S.
again reserved their third-party rights.

The compliance panel was composed in September 1999 and circulated its report in February
2000, finding:

 Australia did not implement the DSB recommendations within reasonable amount of
time. Therefore, no measures were taken in compliance with DSU recommendations, as
required under Article 21.5 of the SPS agreement
 Australia, by requiring that only “consumer-ready salmons” can be imported into
Australia, was maintaining sanitary measures that were not based on a risk assessment,
which was contrary to Articles 5.1 and 2.2 of the SPS Agreement.
 Australia violated Articles 5.1 and 2.2 of the SPS Agreement as a result of a that
effectively prohibits the importation of certain Canadian salmon product without sufficient
scientific evidence.

At the DSB meeting of 18 May 2000, following the compliance panel's decision, Canada
announced that it had come to an agreement with Australia to bring the dispute to a close. The
parties exchanged letters detailing the agreement. Under the agreement, Canada would monitor
closely Australia's commitment to implement the agreement by 1 June 2000. 

 The Newly Laid Rule of ‘Qualified Risk Assessment’

In the Australian Salmon Case, the Appellate Body established a three-pronged test for

satisfactory risk assessment. The test developed requires that the risk assessment:

(1)Identify the diseases whose entry, establishment or spread a Member wants to prevent within
its territory, as well as the potential biological and economic consequences associated with the
entry, establishment or spread of these diseases;

(2) Evaluate the likelihood of entry, establishment or spread of these diseases according to the
SPS measures which might be applied, as well as the associated potential biological and
economic consequences; and

It is significant to note that in both the Australian Salmon Case and the Beef Hormones Case the
Appellate Body has insisted that the risk assessment need to be carried out by the member
adopting the sanitary measure and that the SPS measure. The member must determine the level
of protection it desires against the identified risk, and then the measure that it chooses in order to
achieve the level of protection desired.  Further, in cases where relevant scientific evidence is
insufficient, a Member may provisionally adopt sanitary or phytosanitary measures on the basis
of available pertinent information, including that from the relevant international organizations as
well as from sanitary or phytosanitary measures applied by other Members. In such
circumstances, Members shall seek to obtain the additional information necessary for a more
objective assessment of risk and review the sanitary or phytosanitary measure accordingly within
a reasonable period of time.