Hormones — the findings at a glance

Measure at issue: An EC ban on imports of beef from cows treated with hormones (oestradiol 17ß, progesterone and testosterone, trenbolone acetate (TBA), zeranol and melengestrol acetate) for growth-promotion purposes. The EC claimed the ban was necessary for food safety; the US and Canada claimed there was no evidence of harm to human health.

Panel findings:

• the EC measure violated Article 3 on harmonization. Although international standards existed for five of the six hormones in question, the EC measure was not based on these standards; it reflected a higher level of protection and was not justified by a risk assessment, as required by Article 3.3.
   
• the EC ban was not based on a risk assessment, and violated Article 5.1. The EC’s scientific studies on five of the hormones did not support the ban on hormone-treated meat.
   
• the EC measure violated Article 5.5, because the level of protection sought for hormone-treated meat was higher than required in comparable situations; these differences were arbitrary or unjustifiable, and resulted in discrimination or a disguised restriction on trade. In particular, in contrast to the ban on hormones for growth-promoting purposes, the EC permitted higher levels of the same naturally occurring hormones in untreated meat and other foods; the use of the same hormones for therapeutic and herd management purposes; and the use of other growth promoters (such as the anti-microbials carbadox and olaquindox, known to be carcinogenic) in swine production.
   
• the EC had not invoked Article 5.7, which allows precautionary measures to be taken on a provisional basis, but rather the “precautionary principle” in general. The Panel found that invoking the “precautionary principle” did not override a country’s obligations under the SPS Agreement.
    

Appellate Body findings:

• agreed with the Panel’s finding that since the EC measure reflected a higher level of protection than the international standard and was not justified by a risk assessment, it violated Article 3.
   
• confirmed the Panel’s finding on Article 5.1 that there was no rational relationship between the measure and the scientific evidence submitted on five of the hormones, and found that there was no risk assessment at all for the sixth hormone (melengestrol acetate).
   
• reversed the Panel’s findings on Article 5.5. The Appellate Body considered that there was a fundamental difference between added hormones and naturally-occurring hormones in meat and other foods, and that the therapeutic use of hormones involved closer supervision and control. Although the Appellate Body agreed that the difference between a ban on hormone-treated beef and the use of growth promoters in swine production was arbitrary, it did not consider that this resulted in discrimination or a disguised restriction on trade.
   
• upheld the Panel’s finding on the use of precaution and its relationship with Article 5.7.
    

Implementation/“retaliation”: When the EC was unable to implement by the 13 May 1999 deadline, the US and Canada sought the right to retaliate against US$ 202 million per year and CDN$ 75 million per year. The arbitrators found the appropriate level to be US$ 116 million and CDN$ 11.3 million per year, respectively.