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on May 18, 2015

WTO again rules against US in COOL dispute

If US country of origin labeling laws aren’t swiftly changed, retaliation from Mexico and Canada will happen, many say

The World Trade Organization (WTO) on May 18 ruled against the United States in a dispute concerning country of origin labeling (COOL) requirements for meat products. The most recent decision is the WTO’s fourth and final ruling concerning U.S. COOL laws, which had been repeatedly appealed by the U.S.

U.S. COOL laws have been the center of a long-standing North American dispute, as Canadian and Mexican officials have called the laws unfair and in violation of international trade obligations.

Canada reiterates threat of retaliatory measures

Canada has particularly been critical of U.S. COOL rules, and has repeatedly threatened retaliatory measures against the U.S. if the rules are not repealed.  In a joint statement issued on the day of the most recent and final ruling, Canadian Minister of International Trade Ed Fast and Canadian Minister of Agriculture and Agri-Food Gerry Ritz, reaffirmed their seriousness about retaliatory measures.

“For the fourth time, the WTO has ruled against the United States’ COOL policy, reaffirming Canada’s long-standing position that these measures are blatantly protectionist and discriminate against Canada,” the ministers said. “The United States has used and exhausted all possible means to avoid its international obligations, damaging our highly integrated North American supply chain and hurting producers and processors on both sides of the border. Once again we call on the United States to cease this harmful policy and repeal COOL’s provisions against beef and pork, removing this unnecessary trade barrier. In light of the final ruling, and due to the fact that the United States has continued to discriminate against Canadian livestock products, Canada will be seeking authority from the WTO to use retaliatory measures on U.S. agricultural and non-agricultural products.”

US industry groups, government leaders urge swift corrective measures on COOL

While the governments and trade organizations in both Canada and Mexico have been against U.S. COOL rules, it also has had its share of opponents in the U.S., including House Agriculture Committee Chairman K. Michael Conaway, the National Pork Producers Council (NPPC) and the North American Meat Institute (NAMI).

In a statement issued shortly after the ruling, Conaway said WTO’s ruling was expected, and he will push for quick action to resolve the issue.

"As retaliation by Canada and Mexico becomes a reality, it is more important now than ever to act quickly to avoid a protracted trade war with our two largest trade partners," said Conaway. "I have asked my colleagues on the agriculture committee to weigh in on resolving this issue once and for all during a business meeting this Wednesday in a targeted effort to remove ongoing uncertainty and to provide stability.”

NAMI also responded to the ruling, calling for a change.

“Any action other than repeal invites retaliation from Canada and Mexico that could cost the U.S. economy billions of dollars. We look forward to working with Congress to repeal COOL once and for all, so that the United States can comply with its trade obligations, avoid unnecessary retaliation against our products and restore our strong relationships with important trading partners,” stated Barry Carpenter, NAMI president and CEO.

The U.S. National Farmers Union (NFU), which has been more supportive of COOL rules, stated it still sees value in COOL, but a new agreement should be worked out between the three countries.

“As we have seen in other disputes, once decisions are handed down, WTO members often work together to find a solution that will work for them,” said NFU President Roger Johnson. “In this case, such a solution must involve continuation of a meaningful country-of-origin labeling requirement.”

Conaway will host a press conference regarding COOL on May 19 that includes a bipartisan group of congressional members, and various industry groups including NPPC.

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