US-Import Restriction on Gasoline By Wei Jian Jin Jing Yang Yang

Facts When: 1996 Complainants: Venezuela , later Brazil Respondent: U.S. Subject: Gasoline Why did Venezuela and Brazil complainant U.S? United States ‘s "Gasoline Rule" applied stricter rules on the chemical characteristics of imported gasoline than it did for domestically refined gasoline

Facts ( U.S required imported gasoline to obey the new standard right away, whereas domestic gasoline can implant it 2 years later) Venezuela and Brazil claimed that Gasoline Rule was inconsistent with GATT Article III : National treatment, it was typically discrimination On 10th April 1995 Venezuela sued U.S. to the WTO One year later, Brazil also sued the case to WTO.

Issues Venezuela said this was unfair because US gasoline did not have to meet the same standards — it violated the “national treatment” principle and could not be justified under “exceptions to normal WTO rules for health and environmental conservation measures”. (discrimination)

Issues Venezuela and Brazil requested WTO consultation, claiming that the Gasoline Rule was inconsistent with GATT Article I and III (“national treatment”, i.e. treating domestic and imported products equally), and was not covered by GATT Article XX (which deals with general exceptions to the rules, including for certain environmental reasons).

Issues The US argued that the Gasoline Rule was consistent with Article III, and, in any event, was justified under the exceptions contained in GATT Article XX, paragraphs (b), (g) and (d).

Decisions & Reasons The Panel found: — the gasoline rule was not inconsistent with Art. III:4, as imported gasoline effectively experienced less favorable sales conditions than those afforded to domestic gasoline. —the measure could not be justified under para. (g) because the discriminatory aspect of the measure constituted "unjustifiable discrimination“ and a "disguised restriction on international trade" under the chapeau of Art. XX.

Evaluation Implementing different standards to domestic and imported gasoline in the U.S. is the typical example to carry out trade protectionism in the name of protecting environment.