NEWS RELEASES

March 12, 2001 (1:25 p.m. EST) No. 31

CANADA DISAPPOINTED WITH

WTO APPELLATE BODY'S DECISION

The Appellate Body of the World Trade Organization (WTO) today upheld the main finding in the final report of a WTO panel, which was asked to rule on a decree banning asbestos in France. In its report issued on September 18, 2000, the panel found that the order in question was in compliance with the WTO agreements.

Last September, a WTO panel determined that although the order prohibiting asbestos in France was discriminatory, it was in compliance with provisions in WTO agreements allowing member countries to adopt measures for the protection of human health. On October 23, 2000, Canada appealed some aspects of the panel report.

"We are disappointed with the Appellate Body report," said International Trade Minister Pierre Pettigrew. "While in substance the Appellate Body upheld the findings regarding compliance of the French prohibition measure with WTO agreements, it also clarified some legal points and, to Canada's satisfaction, reversed an important aspect of the report relating to jurisprudence." Specifically, the Appellate Body determined that general prohibitions on products, like the one on chrysotile asbestos, are subject to the rules and disciplines of the WTO Agreement on Technical Barriers to Trade. This part of the decision establishes guidelines for possible general prohibitions of other products in the future.

France opted for a complete prohibition of asbestos in order to manage potential risks associated with exposure to asbestos within its borders. Canada in no way disputes the right of countries to adopt regulations in the public interest or establish appropriate levels of protection, particularly on public health grounds.

"In Canada, we achieve the same health protection objectives through our policy of controlled use of certain specific applications of chrysotile asbestos," said Natural Resources Minister Ralph Goodale. "Canada's policy of safe use is well founded because it has a sound scientific basis and is a responsible approach."

"I wish to thank our stakeholders, the Government of Quebec and representatives of the asbestos industry, for their involvement and their valuable collaboration throughout the WTO proceedings," added Mr. Pettigrew.

The Appellate Body report will be adopted at a future meeting of the WTO Dispute Settlement Body.

For more information, please consult the following Web site:

http://www.dfait-maeci.gc.ca/tna-nac/

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For further information, media representatives may contact:

Sébastien Théberge

Office of the Minister for International Trade

(613) 992-7332

Media Relations Office

Department of Foreign Affairs and International Trade

(613) 995-1874

Pat Breton

Natural Resources Canada

(613) 996-2007

This document is also available on the Department of Foreign Affairs and International Trade Web Site: http://www.dfait-maeci.gc.ca

To access the backgrounder on chrysotile asbestos prepared by

Natural Resources Canada, go to: http://www.NRCan.gc.ca:80/mms/bulletin-e.htm