WT/DS135/R
Page 1

IV.ARGUMENTS PRESENTED BY THIRD PARTIES

A.Brazil

1.Introduction

4.1Brazil explains that the proceeding challenges the WTO-consistency of France's1January1997 Decree, which bans the manufacture, processing, sale and possession for sale, importation, exportation, domestic marketing, offer and transfer of all varieties of asbestos fibres and products containing them (the Decree or the ban).[1] The ban has four narrow exceptions that apply where no substitutes exist for chrysotile products. The substitute products that do exist generally are more expensive than chrysotile products. Thus, the ban clearly operates to create a commercial advantage for substitute products. According to Brazil, a ban is the most trade restrictive of measures. Therefore, the justification for any ban must be subject to the strictest scrutiny, especially as applied to a developing country such as Brazil. The ban has ended Brazilian exports of uncontaminated chrysotile to France. In 1994 and 1995, France imported from Brazil 1,100 and 1,500 metric tonnes of uncontaminated chrysotile, respectively. Since the ban took effect in 1997, France has not imported any chrysotile from Brazil.

4.2According to Brazil, the importance of this proceeding extends far beyond the French ban – the proceeding is a test case. Will other WTO Members be allowed to ban products of developing countries that can be safely used with appropriate, tested precautions simply to appease the public? Modern economies use hundreds of products that present health risks if they are misused, but that present no risks if they are used properly. Uncontaminated chrysotile is one of them; if properly used, uncontaminated chrysotile presents no health risk. Similar products include organic fibres, man-made fibres, benzene, mercury, ammonia, nearly all forms of pesticide, etc. Societies regulate these products to ensure they are used safely so as to protect the health of workers handling them directly and of the general population which is exposed to them indirectly. The same treatment is appropriate for uncontaminated chrysotile. Uncontaminated chrysotile—the only asbestos fibre Brazil mines and exports – is the safest by far of all asbestos fibres. In particular, it is much safer than amphibole, the asbestos responsible for current health problems from past exposure. All of the asbestos that Brazil mines, produces and exports is uncontaminated chrysotile. For this reason, Brazil’s chrysotile products are among the safest in the world. The medical explanation for these facts is set forth in detail in a recent bio-persistence study by Dr.David S. Bernstein, an expert in fibre toxicology (indeed, the EC often seeks his expertise on this topic).[2]

4.3Brazil asserts that the primary issue in this proceeding is not - as the EC would suggest - whether asbestos can be hazardous to human health. It can. Years of misuse and unsafe utilization of the most hazardous form of asbestos – amphibole - have caused significant damage to health. All countries, including Brazil, regret the harm to human health caused by decades of exposure earlier this century to amphibole produced and used worldwide. Brazil understands well the basis of the public outcry, experienced in many countries (including Brazil), that led the French Government to commission the INSERM Report[3] (a study focusing on the health effects of earlier, unsafe uses of amphibole asbestos) and then to ban asbestos. France imposed the ban only one day after INSERM released its Report. The Report was commissioned and released to provide a scientific "cover" for a political decision that had already been taken. However, as a review of the INSERM Report demonstrates, the causes of asbestos-related health problems in France are past uses, especially in the spraying of brittle amphibole on to fireproof buildings and, until quite recently, warships (flocking). Given the long latency period between exposure to amphibole and the onset of any related diseases, workers who were victims of heavy exposure with virtually no protection 30 years ago are experiencing serious health problems today. The INSERM Report is based on analyses of these workers' health. The INSERM Report does not focus on data from studies of modern uses of chrysotile. Moreover, in the Report, INSERM concedes that it was unable to produce "scientifically certain" conclusions, but could present only an "aid to understanding" based on "plausible, though uncertain, estimates.[4]" Quite simply, the INSERM Report is an inadequate basis for the ban.

4.4Brazil argues that it has a deep appreciation of the desire - indeed, the need - for the FrenchGovernment to address public concern and protect public health. Brazil also understands the frustration of being unable to remedy or even mitigate the health consequences of past exposure from unsafe use of amphibole, and the frustration of being unable to take measures to remedy or decrease exposure from flocked amphibole asbestos that is already in French buildings (because disturbing flocking increases exposure). However, when France approved the WTO Agreement, it agreed not to restrict trade merely to appease domestic sentiment, no matter how strong. Brazil cannot accept France's adoption of a politically motivated measure that will neither (i)make those already sick from asbestos exposure healthy; nor (ii)reduce risk to the healthy beyond existing levels of protection guaranteed by modern, controlled uses of chrysotile. As the European Commission recently stated:

[V]arious national organisations, including the Health and Safety Executive in the UnitedKingdom, have made very disturbing projections about the numbers of deaths which are likely to be attributable to asbestos over the next few decades. However, it is important to note that these figures relate to past exposures to mixed asbestos types, including the fibres which have already been banned. It would be wrong to use these statistics alone to justify a ban on the marketing and use of chrysotile because such a ban would not lead to a lower risk of exposure for workers to asbestos which is already in place, nor would it reduce the number of deaths which are occurring today as a result of past exposure to asbestos.[5]

4.5Modern uses of asbestos are or should be limited to chrysotile, which most parties, including INSERM, agree is safer than other forms of asbestos. Moreover, modern uses are or should be confined to products in which the fibres are bonded in a finished product and, thus, cannot escape, e.g., asbestos-cement products.[6] For these and other reasons, modern uses are quite safe; they involve exceedingly low levels of exposure (that often do not exceed even the "natural" levels in ambient air). Chrysotile is used in a very wide variety of products. It is used as a flame retardant, to strengthen friction materials (e.g., truck brakes) and to create cement pipes for carrying water that are far less subject to corrosion, cracking and breaking than traditional cement pipes. In most applications, chrysotile is used because it increases public safety; thus, using other, less-efficient products in its place often decreases public safety. The use of chrysotile as a fire retardant needs no explanation. However, a discussion of its use in friction materials may be illuminating. Chrysotile is used primarily in truck brake pads, drum brakes and brake blocks to control heat build-up, thus maximizing friction and stopping power. It is the preferred product for this application. As one of the authors of an American Society of Mechanical Engineers (ASME) study commissioned by the EPA concluded:

(a)The "replacement/substitution of asbestos-based with non-asbestos brake linings will produce grave risks"; and

(b)"the expected increase of skid-related highway accidents and resultant traffic deaths would certainly be expected to overshadow any potential health-related benefits of fiber substitution."[7]

4.6Brazil pleads that chrysotile's numerous public safety benefits - the many contributions it makes to societies around the world - not be ignored in this proceeding, as they were when France passed its ban. In Brazil's view, the primary question in this proceeding is quite narrow - is a complete ban necessary to protect public health or can public health be ensured by regulating modern, controlled uses of chrysotile and chrysotile products? The answer arrived at by those countries in the Americas that have examined the issue closely, ranging south from Canada, to the United States, to Brazil, is that public health can be ensured by regulating modern controlled uses. France may, of course, take measures that are designed to, and actually do, protect its citizens. However, the ban does not meet even this very generous characterization of the general rule set forth in the WTO Agreement on Technical Barriers to Trade (the TBT Agreement). France must not be allowed to impose a ban on imports and safe, modern uses of chrysotile as a response to public pressure. That the ban does not apply to man-made fibres produced in France, which the available scientific data show present greater risks when their use is not controlled and which have not been proven safer, confirms that the basis for the ban may be political and economic, but is not scientific or medical.

4.7Brazil argues that in many respects, the French reaction is identical to that of the United States Environmental Protection Agency (the EPA) promulgated in 1989, when it banned asbestos under pressure from panicked U.S. public opinion. The EPA was unable to justify its ban scientifically to the United States Court of Appeals for the Fifth Circuit. After lengthy legal proceedings, the Fifth Circuit ordered the EPA to reverse its decision and to acknowledge publicly that modern products containing chrysotile enclosed in a matrix of cement or resin do not pose any detectable risk to public health.[8] (Today, although amphiboles are prohibited in the United States, a number of products containing non-brittle chrysotile are permitted, including the products manufactured by Brazil and previously manufactured in France from Brazilian chrysotile.) Unfortunately, France has adopted a measure that unnecessarily and to no good effect impedes international trade.

4.8Brazil makes the following claims regarding the ban: (1) the ban is inconsistent with Article2.2 of the TBT Agreement because it creates unnecessary obstacles to trade and is more trade restrictive than necessary; (2) the ban is inconsistent with ArticleXI of the General Agreement on Tariffs and Trade 1994 (GATT 1994) because it is a quantitative restriction that is not excused by the exceptions in ArticleXI:2 or ArticleXX; (3) the ban is inconsistent with Article2.8 of the TBTAgreement because it applies to asbestos but not to man-made fibres or other substitute products and thus operates as a technical regulation setting forth an unnecessary design or descriptive characteristic; (4) the ban is inconsistent with Article2.4 of the TBT Agreement because international standards for producing and using chrysotile and chrysotile products exist and France should have used them; (5) the ban is inconsistent with ArticleIII:4 of the GATT 1994 and Article2.1 of the TBTAgreement (national treatment) because it does not apply to domestic man-made fibres and other substitute products, which are like products to chrysotile; and (6) the ban is inconsistent with ArticleI:1 of the GATT 1994 and Article2.1 of the TBT Agreement (MFN) because, insofar as it bans imports of chrysotile and chrysotile products, but not imported like product substitutes, it improperly discriminates among imports.

2.Factual Aspects

4.9Brazil concurs with practically all aspects of Canada's presentation, agreeing (i) that the French ban was passed in response to public outcry in France over the deaths associated with the intensive exposure to amphibole that had taken place early on in the century; (ii) with the circumstances and risks of exposure presented by Canada. In particular, it agrees with the statement that exposure, even in asbestos product plants, has decreased significantly and that, apart from existing flocked amphibole, current exposure is limited, or could be limited, entirely to chrysotile; in contrast, past exposure and current exposure from past uses (e.g. flocking) included exposure to amphibole; (iii) that current levels of exposure to modern uses of chrysotile are not significant and are not associated with substantial health risks; (iv) with the fact that current controlled-use policies and standards which are accepted internationally are sufficient to ensure the health of chrysotile workers and others exposed to chrysotile and to guarantee their safety; and, (v) with Canada's argument that the INSERM Report has many defects and that it was not the reason for France's ban on modern, controlled uses of chrysotile and chrysotile products.

4.10Brazil considers that a "battle of experts", with one side presenting experts who support banning chrysotile and the other presenting experts who oppose banning chrysotile would be, in this case, both uninformative and unnecessary because the INSERM Report and the Synthesis[9], as a matter of law, not fact, cannot support the ban.[10] This Report and the Synthesis have several defects that render them utterly incapable of supporting the ban.[11] INSERM has not conducted original research, but merely based itself on existing studies and, furthermore, it has not examined all existing studies as it has deliberately excluded those that have established a distinction between chrysotile and amphiboles. More specifically, the shortcomings of the INSERM Report include the following. First, the Report completely fails to examine the modern uses of chrysotile and chrysotile products and, thus, ignores the current state of the industry. Instead, it focuses on the health effects of exposure to amphibole that took place in previous decades. INSERM concedes that it does not have "direct, certain scientific" data on the health risks associated with current levels of exposure to the modern uses of any form of asbestos, much less chrysotile.[12] In short, INSERM does not examine current uses and exposure levels and does not distinguish among the different levels of risk associated with the different types of asbestos fibres (chrysotile, the only type produced and exported by Brazil, as well as used in it, is accepted as being the safest of asbestos fibres, even by INSERM itself).[13]

4.11Second, the INSERM Report fails to examine the efficiency of the ways in which worker exposure has been reduced through the use of air filters in mines and plants[14], and employing masks, laundry services, etc. Third, it does not even compare the risks of the past to the risks associated with man-made fibres[15] and substitute products (such as ductile iron or polyvinyl chloride (PVC) pipes).[16] By the time INSERM began to examine substitutes, the ban had already been in effect for1.5 years and, in any case, INSERM issued only a synthesis and not a complete report on these substitutes. INSERM concedes in its Report that it lacked the data required to recommend the banning of chrysotile and only to allow its substitutes.[17] INSERM emphasizes that because it is the structure (size and shape) of fibres that makes them toxic when inhaled, any substitute fibre must be viewed as dangerous to human health.[18] Finally, INSERM concedes that, although the health data it applied to chrysotile are from past, massive and prolonged exposure to amphibole, the data being collected for substitutes is based on much lower levels of exposure, replicating modern conditions. Most telling is that INSERM states that toxicity levels for "asbestos" as a whole (and not merely for chrysotile) would yield similar results to those obtained for substitutes if similar testing conditions had been used.[19]

4.12Brazil further argues that INSERM uses a linear risk model to assume illogically and without any evidence that a threshold does not exist for safe exposure.[20] France and INSERM are forced to commit this methodological error (the assumption) due to the fact that they had data from past prolonged exposure to amphibole but not to current, much lower exposure to chrysotile.[21] To justify the ban on the modern uses of chrysotile, France/INSERM had to assume that significant risk is present at all levels of exposure, even at those that are insignificant, out of political self-interest. INSERM adopted the linear risk model despite the fact that studies cited by the EuropeanCommunities (hereinafter "EC") themselves indicate that "bricoleurs" are not at risk. The study conducted by Iwatsubo etal.[22] indicates that low, sporadic, intermittent and cumulative exposure of up to0.5fibres/ml-years does not present increased risk of mesothelioma. In commenting upon the results of an earlier study, the authors note that "no significant risk was observed for those whose exposure was intermittent".

4.13Brazil argues that a close examination of the INSERM Report reveals that: (i) prolonged exposure to amphibole (its past uses) is associated with severe health problems (a proposition with which everyone agrees); (ii) substitute fibres have similar structures and, thus, when subject to scientific scrutiny, are expected to have similar health effects at similar levels of exposure; (iii)insufficient data exists on the health effects of current levels of exposure to chrysotile and substitute fibres, but the available data suggests that their health effects would be the same; and (iv)the Report does not purport to be as conclusive as France would have all believe; rather, to overcome (iii)above, INSERM extrapolated from the data used in (i), which as it itself concedes "does not produce scientifically certain knowledge, but only an aid to understanding the implications for risk management.[23]" Brazil contends that the ban has been based on the irrelevant data described above. France employs the linear risk model as a tool to make data on past uses relevant to the imposition of the ban. However, INSERM researchers themselves recognize the limitations of this model and clearly state that it cannot produce "scientifically certain knowledge," but can only serve as an "aid to understanding," based on "plausible, though uncertain, estimates.[24]" These "conclusions" do not support significant trade restrictions, much less the ban. Rather, they are merely a call for further research.