WASHINGTON, June 7, 2013- The Canadian government announced it will continue into the next phase of its World Trade Organization dispute regarding the United States’ amended Country of Origin Labeling (COOL) rule.
“The U.S. government continues its unfair trade practices, which are severely damaging to Canadian industry and jobs,” Canada’s Minister of International Trade Ed Fast and Minister of Agriculture Gerry Ritz said in a statement today.
Under COOL, retailers must provide their customers with information about the origin of various food products, including fruits, vegetables, fish and shellfish and meats. On May 24, USDA published a final rule in the Federal Register to modify the labeling provisions for muscle cut commodities covered under the program.
Calling mandatory COOL “a protectionist policy,” Fast and Ritz added in their statement today, “When the United States failed to comply by the May 23 deadline, we said we would pursue all options available.”
They also issued a list of U.S. commodities that may be targeted for retaliation. The list includes: beef, pork and chicken in addition to a wide range of grains, fruits and dairy products.
“Our government will continue to consult with stakeholders as we pursue a fair resolution of this issue through the WTO over the next 18 to 24 months,” they said. “To respect Canada’s WTO obligations, our government will not act on these retaliatory measures until the WTO authorizes us to do so.”
In response, the National Cattlemen’s Beef Association (NCBA) said the list of products “brings home the real-world consequences of the USDA’s adherence to MCOOL.”
NCBA President Scott George said COOL should be treated as a marketing tool and that it does not fit into international trading obligations.
“Our members have warned both the USDA and members of Congress that should this program continue, there will be a true cost to not only cattle and pork producers but to many other segments of the U.S. economy as well,” George said. “This is too high a price to pay for a program that has proven it has no value.”
The final U.S. COOL rule published last month modifies the labeling provisions for muscle cut covered commodities to require the origin designations to include information about where each of the production steps, such as where an animal was born, raised and slaughtered, occurred and removes the allowance for commingling of muscle cuts.
In June 2012, the Appellate Body of the World Trade Organization (WTO) affirmed an earlier WTO Panel decision finding that the United States’ COOL requirements for certain meat commodities discriminated against Canadian and Mexican livestock imports and thus were inconsistent with the WTO Agreement on Technical Barriers to Trade.
Although meat and poultry industry groups including NCBA and the American Meat Institute (AMI) said the COOL rule damages their relationship with trading partners and causes problems for producers, National Farmers Union (NFU) President Roger Johnson supported the provision.
Describing COOL as providing “common-sense information to American consumers,” Johnson noted the WTO Appellate Body ruled in 2012 that the COOL law itself is WTO-compliant, but the way in which it was implemented is not.
“To solve this issue, USDA’s final COOL rule fully complies with the ruling and resolves the dispute,” Johnson said when the final rule published. “Imminent retaliation is nothing more than a scare tactic designed to persuade Congress to change the COOL law, which has already been ruled WTO-compliant.”
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