On 12 June 2007, the WTO Panel considering Brazilian measures concerning imports of retreaded tyres finally circulated its report to the parties. It had previously missed four deadlines. Environmental groups have been closely watching the case which is the first-ever challenge against trade restrictions imposed by a developing country for health and environmental reasons.

The EU had alleged that Brazil’s import limitations on retreaded types (ie, used tyres that are reprocessed for a second and final use) were intended to protect the local tyre industry rather than to pursue genuine public health objectives. The WTO ruled that Brazil had violated GATT rules, but it did agree with the health- and environment related justifications for the restrictions, objecting only to the way in which the measures were applied.

Past WTO rulings have also found other trade restrictions to be justifiable under the exemptions for health, environment and other public interest obligations set out in the GATT Agreement. However, only a few such restrictions have succeeded in overcoming the hurdle of non-discriminatory application.