Despite the fact that it was nominally victorious, in early September 2007, the EU took the unusual step of filing an appeal at the WTO against the panel’s ruling on Brazil’s restrictions on imported retreaded tyres from the EU. The EU says that, despite the WTO panel’s decision that the ban contravenes WTO rules, it disagrees with the panel’s reasoning on several points, and “correcting them would be not only important for the EU’s trade interests, but also the general interest to ensure that WTO rules be applied so as to ensure real and effective protection of the environment, rather than allowing protectionism”.

The EU had alleged that Brazil’s import limitations on retreaded tyres (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.

A ruling by the WTO Appellate Body is expected in December 2007.