2. Article 2.2

(a) General

58. The United States recalled that Article 2.2 of the SPS Agreement required a Member to base its phytosanitary measures on scientific principles and prohibited a Member from maintaining sanitary and phytosanitary measures "without sufficient scientific evidence". The SPS Agreement did not define "based on scientific principles". However, at a minimum, to base a measure on scientific principles required that a WTO Member had identified a particular risk that the measure was designed to protect against, and conducted some review of scientific evidence or other relevant scientific information to demonstrate that the measure in fact protected against that risk. The risk that had to be addressed was whether there was a possibility of the inadvertent entry of codling moth from US products, on a variety-by-variety basis, in light of pre- and post-harvest practices and quarantine treatment. In other words, the risk of introduction of codling moth in the absence of the varietal testing requirement. The United States noted that the strongest wording Japan had been able to employ was that "it is possible there may be variation in the efficacy of disinfestation even if the same quarantine treatment is applied to different varieties" [emphasis added]. ⁵⁹ Yet the Appellate Body Report on EC - Hormones had noted that a theoretical risk would always remain because "science can never provide absolute certainty that a given substance will not ever have adverse health effects. We agree with the Panel that this theoretical uncertainty is not the kind of risk which, under Article 5.1, is to be assessed".⁶⁰
59. The United States claimed that Japan had never been able to provide an explanation as to why it was necessary to test each variety of a product. There was no scientific reason why the types of differences that distinguished one apple, nectarine, walnut or cherry from another would be relevant to the effectiveness of the quarantine treatment. Empirical evidence supported the fact that with quarantine treatment for codling moth using the preferred treatment of MB and/or a two component treatment of MB and cold storage, the particular variety of the product did not matter for purposes of the quarantine treatment needed. ⁶¹ In other words, the quarantine treatment had always been equally effective irrespective of variety. The additional and redundant testing required by Japan had never been proven necessary.
60. Japan noted that the main thrust of the US argument appeared to be that there was no scientific basis for varietal testing. Japan maintained that its position was based on a sufficient amount of available literature and scientific data which indicated the possible presence of a statistically significant difference in the efficacy of known disinfestation measures across varieties of the same products, differences which could require application of a different treatment.
61. Japan claimed that the import prohibition fully met the criteria, developed by the Appellate Body in EC - Hormones, of being "based on" scientific evidence, or a risk assessment:

"... Article 5.1, when contextually read as it should be, in conjunction with and as informed by Article 2.2 of the SPS Agreement, requires that the results of the risk assessment must sufficiently warrant � that is to say, reasonably support � the SPS measure." ⁶²

62. Japan had relied on the following available evidence which had led to the conclusion that the import prohibition was warranted against codling moth:

1. Honma, K. (1976) Plant Protection 30: 237-244. (in Japanese)
2. Proverbs, M.D. et al., (1982) Can. Entomol. 114: 363-376.
3. Moffitt, H.R. et al., (1988) J. Econ. Entomol. 81: 1511-1515.
4. Beers, E.H. et al., (1988) In Orchard Pest Management, pp. 63-68.
5. MAFF (1995) In Handbook of Agricultural Statistics, pp. 225-238. (in Japanese)
6. IIE (1995) Distribution Maps of Pests, Series A. No. 9, CAB International.
7. Tokyo Astronomical Observatory (1995) In Chronological Scientific Tables, pp.198-199. (in Japanese)
8. Yamaguchi, A. & A. Otake eds. (1986) In Disease and Invertebrate Pests of Fruits Trees, pp. 226-230. (in Japanese)
9. Japan Tariff Association (1993, 1994, 1995) In Japan Exports & Imports No. 12, p. 94. (1993), p. 93. (1994), p. 93. (1995).

63. These pieces of literature contained or lead to the following findings:

1. Codling moth could survive in areas where the effective cumulative temperature (the yearly sum of the daily temperature figures which are 10 degrees or above) was 600 day-degrees and the lowest monthly temperature of the coldest month fell below 10 degrees centigrade. Most Japanese regions met this criteria.
2. The insect was able to establish itself in Japan in light of the amount of host plants.
3. When codling moth larvae diapaused through the winter in cocoons, and, after the pupal stage in early spring, the moth emerged during the blooming season of apples.
4. In contrast to a sedentary pest such as scale, codling moth was able to spread by flight. There was a report that the moth could move within a range of 300 to 500 feet, and records that they had flown 1,000 to 2,000 feet. Moreover, a Canadian study on control by sterile insect releases found that male moths released from a point were recaptured in traps 3.5 kilometres to 7.2 kilometres away.
5. The larvae entered into the apple fruits at every growing stage, and it severely damaged commercial value.
6. In an area not subject to pest control, the infestation rate in pears was 57.3 per cent to 100 per cent.
7. Newly hatched larvae entered into the fruits from the calyx end or from cracks, and were very difficult to detect.
8. Export markets could be lost.
9. Control costs could increase.

64. From the above findings, Japan drew the following conclusions and decided that import prohibition was the appropriate phytosanitary measure:

1. codling moth had a high potential (grade a) of entry and establishment, while its spread potential was medium (grade b);
2. the pest was highly likely to cause grave damage (grade a) to agricultural production once it was introduced into the country; and,
3. there was no practical, effective inspection method to detect the presence of the moth inside fruits, and the level of management difficulty was the highest (A1).

65. The United States claimed that Japan was mischaracterizing the dispute. The issue was not whether codling moth was of quarantine significance. That was not in dispute. What was in dispute was whether there was any scientific basis for Japan�s assumption that variety affected efficacy of treatment against codling moth. Japan had asserted that variety presented a risk in relation to quarantine treatments with methyl bromide, and yet it could not support this theoretical uncertainty with scientific evidence. In fact, Japan had instituted this requirement before any of the scientific studies on which it claimed to rely had been conducted. ⁶³ Japan had yet to explain why varieties needed to be tested separately. If each variety needed to be tested separately because varietal differences "could" matter, then why not separately test by a whole series of other arbitrary factors, such as by color, by ripeness, or by length of time in shipment? In essence, Japan had assumed variety mattered, and then challenged exporting countries to prove it did not. According to the United States, this was not the way the SPS Agreement was structured.
66. The United States noted that addressing the risk at issue came down to an exporting Member�s ability to kill the pest in question, codling moth, in each variety of a product. This was the fundamental question that had to be analyzed under Articles 2.2 and 5.1 of the SPS Agreement. Japan had established a particular level of mortality that it wanted any quarantine treatment to achieve. This was, however, not the same as an appropriate level of protection. There was no dispute over that mortality level. The United States wished to clarify the mortality level did not relate to: sorptive patterns, CxT findings, preliminary dose-mortality testing or the other information and procedures that scientists used to identify a treatment that would kill codling moth on a given product. The significance of those data and techniques was in the contributions that they made to scientists� conclusions about the fumigant dosage needed to achieve the required level of pest mortality.
67. Japan had suggested that the existence of risks could be inferred from the studies it had submitted. Yet none of the these studies were structured in such a way that they answered the basic questions of fact which might serve as scientific evidence for the risk at issue. Even if Japan had been accurate with respect to the significance of every piece of data it had cited, and the conclusions of each and every study, the question would remain whether Japan�s varietal testing requirement was supported by sufficient scientific evidence, and whether the risk at issue was more than hypothetical. The United States maintained that responses by the experts advising the Panel had been very helpful in clarifying that it was not possible to attribute the data variations cited in these studies to varietal differences, let alone to differences of a magnitude that could affect treatment efficacy. The United States stressed that all of the experts had confirmed that the existence of varietal differences affecting treatment efficacy could not be determined on the basis of the evidence before the Panel.
68. Japan claimed that the risk it faced was not the "theoretical uncertainty" the Appellate Body had referred to in EC - Hormones. The present case was substantially different from EC � Hormones; while the safety of the substances was internationally established in the EC � Hormones case, no one doubted the risk posed by codling moth to Japan. While the European Communities only asserted that safety of hormones was not proven beyond doubt, Japan's concern was based on available data. This data was the basis for Japan's scientific concern over the efficacy of the treatment across varieties.
69. Hence, Japan disagreed with the US argument that Japan referred only to theoretical uncertainty as the basis for "varietal testing" for MB fumigation, and, therefore, that Japanese policy was not based on a risk assessment. First, Japan recalled that there was no requirement of "complete testing and review of each variety" under the Japanese policy (paragraph 4.23). All that was required of each variety was the demonstration of efficacy in small-scale laboratory experiments to compare dose-response with other varieties (at the time of initial lifting), or with the approved treatment level (at the time of additional lifting). Large-scale demonstration was only required of a representative variety. Second, Japan noted that there was nothing inherently wrong about Japan's concern in respect of varietal differences. Japan claimed that the United States had itself established different treatment standards for different varieties of mangoes (paragraph 4.136 and following paragraphs).
70. Japan noted that in the case of MB fumigation to counter codling moth, data was available in the form of varietal dose-response results which suggested the possible presence of differences in efficacy of fumigation treatment between varieties. Japan's hypothesis was that characteristics of a particular variety could affect fumigation efficacy, possibly by their impact on the CxT value (explained in further detail in paragraph 4.109 and after). In light of available data and present knowledge of the fumigation process, this was a reasonable argument. Japan's policy was thus based on a scientific hypothesis which was in turn supported by empirical data, in full conformity with the obligations contained in Article 2.2 and Article 5.1.
71. Japan noted that the United States apparently found rationale for the product-by-product testing in the fact that the efficacy of the treatment applied for one variety of a product had never varied from that of the treatment applied to another variety of the same product. The United States repeatedly emphasized the fact that an MB fumigation standard had not been modified in the past. Japan acknowledged that it was true that existing treatment levels of host plants of codling moth had been found effective for additional varieties. However, as a matter of science, all this proved was the efficacy of the treatment on the tested varieties; it fell short of showing absence of varietal difference within a product altogether. Possibly, the US argument could be founded on an intuitive judgement, based on past experience. However, out of 100 varieties of nectarines in commercial production, only three varieties had been tested by a large-scale (10,000 to 30,000 insects) test. Similarly, out of 44 varieties of apples, only two had been tested by the large-scale test.
72. Japan further noted that, according to the US argument, if there were 100 varieties in one product category, a treatment based on a selective test of any variety would have to be presumed to be effective for the other 99 varieties. Far more scientific evidence than provided by the United States in the current proceedings was needed before Japan could reach such a conclusion. The implications of the US arguments were: (i) that the present quarantine treatment would be effective for unapproved varieties (including varieties yet to be developed) of apples, cherries, nectarines and walnuts; and, (ii) for other products which the United States claimed to be within the terms of reference, they would seek to apply a single treatment for all varieties (including varieties yet to be developed).
73. The United States had not provided any information on disinfestation of unapproved varieties or unapproved products. Obviously, there was no information on products yet to be developed, possibly through rapidly advancing biotechnology. Nor had the United States presented a theoretical argument regarding the absence of varietal difference in the disinfestation effects of these products. Japan had to conclude that the United States had not performed the required demonstration of efficacy of treatment across varieties.
74. The United States stated that it found unremarkable Japan's conclusion that the United States had not proven, with scientific certainty, the absence of varietal differences. This conclusion did not more than state, as the Appellate Body Report in EC � Hormones recognized, that science could never, with absolute certainty, prove the negative. This did not excuse Japan from its obligations to base its requirement on a risk assessment and sufficient evidence, obligations which Japan had failed to fulfill.

To continue with Probit 9, dose-mortality tests and confirmatory tests

⁵⁹ Japan's response to Question 4 of US Consultation Questions (US Exhibit 3).

⁶⁰ Op. cit., paragraph 186 (italics in original).

⁶¹ US Exhibit 2.

⁶² Op. cit., paragraph 193.

⁶³ The United States noted that the earliest reference wherein Japan identified any basis for its assumption that variety affects efficacy of quarantine treatment was in the Wearing et al.,1980 Study on New Zealand Cherries (contained in Japan, Exhibit 13).