Select Committee on European Scrutiny Sixteenth Report


Extract from letter from the former Parliamentary Under-Secretary of State

for Consumers and Corporate Affairs at the Department of Trade and Industry (Dr Kim Howells) to the

Chairman of the Committee


A WTO challenge could arise where a cosmetic product coming from a third country which had been tested on animals was prohibited under the marketing ban whereas a 'like' cosmetic product produced in the Community and not tested on animals was not. In such an event it could be argued that the fact that Community cosmetics tested on animals would also be prohibited is irrelevant, and that what is at issue is whether the imported product is being treated less favourably than that accorded to 'like' products of national origin in respect of all laws, regulations and requirements affecting their internal sale, offering for sale, purchase or use. If such a case was taken by a third country the outcome would hinge on whether the imported and domestic products were 'like' products and if so whether the discriminatory treatment could be justified under the exceptions permitted under Article XX GATT (see below).

In addition, the marketing ban on cosmetics tested on animals might be challenged by a third country as being in breach of Article XI GATT as effectively amounting to a restriction or prohibition on the importation of such cosmetics into the Community. It is very common for cases involving an alleged breach of Article III.4 GATT to also include a claim for breach of Article XI (usually as alternatives). If this claim was upheld by a Panel then the Community would again have to defend the prohibition on the basis that the measure fell within one or more of the permitted exceptions in Article XX GATT.

The Article XX GATT exceptions referred to above are interpreted narrowly and the only ones which might be invoked in this case are Article XX(a) and XX(b). The scope of the Article XX(a) exception (measures necessary to protect public morals) has never been determined by a WTO panel or the Appellate Body and it is questionable whether it could be successfully invoked to defend the marketing ban on animal tested cosmetics. In any event Article XX(a) is couched in terms of measures which are 'necessary' to protect public morals. Using the approach taken by Panels and the Appellate Body in other cases, the word 'necessary' must be read as meaning that no less trade-restrictive alternative is available to the Community to achieve its desired objective. It could be difficult to argue that this was the case given that the Community has come forward with an alternative proposal which is clearly less trade-restrictive.

As regards the Community placing reliance on the Article XX(b) exception (measures necessary to protect human, animal or plant life or health) it is difficult to see how the Community could establish that the ban on animal testing achieves that goal. The protection of animal life and health in the Article XX(b) context is taken to relate to issues such as protection from diseases rather than protection from testing. The use of animal testing in no way adversely affects the cosmetic product's characteristics or quality and it is therefore difficult to see how the Community could justify its marketing ban on health grounds. In any event, Article XX(b) is also subject to the 'necessary' requirement and the same comment made above about the meaning of the term 'necessary' would apply here as well. If there is a less trade restrictive means of achieving the Community's stated objective then the Community will not be able to rely on the Article XX(b) GATT exception.

There are also a number of provisions in Article 2 of the Technical Barriers to Trade (TBT) Agreement, which may be relevant.

Article 2.2 of the TBT requires WTO Members to ensure that technical regulations are not prepared, adopted or applied with a view to or with the effect of creating unnecessary obstacles to international trade. It is arguable that a third country would seek to argue that the marketing ban had the effect of creating an unnecessary obstacle to international trade and could not be saved under the legitimate objectives provided for in Article 2 of the TBT; and

Article 2.3 TBT provides that technical regulations shall not be maintained if the circumstances or objectives giving rise to their adoption no longer exist or if the changed circumstances or objectives can be addressed in a less restrictive manner. As stated above in relation to GATT it is difficult for the Community to argue that it cannot achieve its stated objective in a less trade restrictive manner when it has brought forward a proposal showing how this might be achieved.

27 July 2000

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