Keeping the GATT Article XX discussion going, this Article XX issue may be one of the more difficult ones. Are there special considerations under Article XX when the product at issue is a "used" one, such as retreaded tires, waste products, or "scrap" products? Can you take actions with respect to such products that would not otherwise qualify under Article XX for "normal" products? Here's what the complainants said on this point in response to one of China's arguments in the China - Exportation of Raw Materials case:
102. According to China, export duties on scrap will ensure a steady supply of scrap and lead to a shift away from primary production (or production from crude ores) and toward increased secondary production. China argues that secondary production is more environmentally friendly than primary production, and, therefore, increased secondary production will lead to a reduction in health risks associated with primary production. Based on this, China concludes that its export duties on the scrap products are “necessary to protect human, animal or plant life or health.”
103. As we have noted, however, there is no evidence that China’s objective in imposing these export duties is in fact the reduction of health risks associated with pollution. China’s economic studies in its submission were developed solely for the purpose of this dispute. In terms of preexisting materials, China only points to a single statement in one document, the National Eleventh Five-Year Plan for Environmental Protection. However, this statement draws no link between the export duties at issue and health or environmental concerns.30 To the contrary, as the cocomplainants demonstrated in their first written submissions, China’s own statements and policies demonstrate that the export duties at issue in this dispute are in pursuit of the economic benefits associated with increased production of higher value-added industrial products, by controlling the supply of important raw material inputs.31 Thus, China’s contentions regarding the supposed objective underlying its export restrictions are directly contradicted by China’s own statements.
104. Second, China has failed to establish that the export duties are contributing to, let alone necessary to, accomplishing China’s purported objective. China presents no evidence that any secondary production is actually occurring in China. Instead, China merely estimates a particular rate of secondary production that would result from an export duty on scrap, and provides no basis for the assumptions underlying that estimate.32 Thus, the Panel has no actual evidence that the export duties are resulting in any increased secondary production.
