WTO rules against U.S. COOL’s livestock rules

The WTO said the amended rules increase origin labeling’s ‘detrimental impact’ on imported livestock into the U.S. market.

   The World Trade Organization on Monday sided with Canada and Mexico over the U.S. government’s application of country of origin labeling rules, as amended in 2013, for beef and pork.
   The WTO compliance panel found “the amended COOL measure increases the original COOL measure’s detrimental impact on the competitive opportunities of imported livestock in the U.S. market, because it necessitates increased segregation of meat and livestock according to origin; entails a higher record-keeping burden; and increases the original COOL measure’s incentive to choose domestic over imported livestock.”
   The WTO ruled June 29, 2012, that the United States’ COOL unfairly discriminated against Canada and Mexico because it gave less favorable treatment to beef and pork imported from those countries than to U.S. meat and said the United States had until May 23, 2013, to bring its COOL measure on livestock imports from Canada and Mexico into compliance with its WTO obligations. Canada and Mexico then challenged the revised U.S. COOL rules for livestock in the WTO.
   Agricultural groups on both sides of the border welcomed the WTO panel’s latest report on the U.S. COOL regulations. 
   “The compliance panel report leaves no shadow of a doubt that the U.S. COOL legislation is causing discrimination against live imports of cattle and hogs into the U.S. marketplace,” said Canadian Cattlemen’s Association President Dave Solverson in a statement. “Until COOL comes into compliance with the WTO, the CCA will continue to insist that the government of Canada prepare to impose prohibitively high tariffs on key U.S. exports to Canada, including beef.”
   The next step in the WTO process will be adoption of the report at a meeting of the Dispute Settlement Body (DSB). Adoption of the report, which can be delayed only by a U.S. appeal, would trigger Canada’s rights to compensation or retaliation. If the United States files an appeal and Canada once again wins, Canada would be authorized to impose retaliatory tariffs on U.S. exports.
   The impact of COOL on the combined Canadian cattle and hog sectors was estimated in 2012 to be about $1.1 billion per year; however, the impact has increased since the U.S. Department of Agriculture amended the regulation in 2013.
   The American Soybean Association President Ray Gaesser said “mandatory country of origin labeling in its current state is an unworkable burden on soybean farmers’ largest customers — the animal agriculture industry.
   “What’s worse is that the fallout from this rule following the finding of noncompliance by WTO will include a system of retaliatory tariffs by Canada and Mexico that will, at the very least, harm our partners in the animal agriculture industry,” he warned.
   The COOL Reform Coalition continues to urge USDA to “suspend the COOL rule indefinitely to avert a potential economic disaster not only for the American livestock industry, but also for those sectors like ours that depend so greatly on animal agriculture,” Gaesser said.