Trade Compliance

GHY discusses changes to international trade regulations and explores cutting-edge compliance strategies.

COOL Supporters Push to Appeal WTO Decision

Posted October 22, 2014

Despite suffering another defeat at the World Trade Organization (WTO), supporters of the U.S. country-of-origin labeling (COOL) regulations have reiterated their continued strong backing for the law and vowed to press the Obama administration to appeal the latest decision.
Tribunal
“While we will continue to review the WTO’s decision, we urge the U.S. Trade Representative to consider appealing the ruling if there are meritorious grounds to do so,” said a statement issued by United States Cattlemen’s Association (USCA). “In addition, we ask USDA to review the ruling to determine whether additional regulatory changes may permit the U.S. to come into compliance without weakening COOL.”

USCA president Danni Beer urged Congress to resist calls to withdraw the controversial rule that both Canada and Mexico claim has cost their pork and beef industries billions in lost business since it was implemented in 2009. “Today’s ruling provides no basis for false alarms about repealing the COOL statute itself,” said Beer. Congress should continue to resist such premature and unfounded calls to weaken a law that enjoys such strong support from America’s consumers, ranchers, and producers.”

Groups opposed to COOL, including the American Meat Institute, National Cattlemen’s Beef Association, National Chicken Council, National Pork Producers Council and other agri-food trade associations have described the USDA’s meat labelling regime as “a broken program that has only added costs to our industries without any measurable benefit for America’s livestock producers.” The groups banded together to petition Congress last June with a request that the COOL rule be suspended in the event of another WTO decision finding it to be an unfair trade practice.

Since the WTO’s latest decision, COOL opponents have been urging the U.S. Trade Representative and U.S. Department of Agriculture to work together with the industry and Congress to amend the COOL statute so that it complies with international obligations and brings stability to the market. “Such a change would help restore strong relationships with some of our largest and most important trading partners,” they said.

Those supporting the meat labelling scheme, including the National Farmers Union, National Farmers Organization, the National Sustainable Agriculture Coalition and other groups, strongly decry what they call the WTO’s “continued assault against commonsense food labels” pointing to it as “just another example of how corporate-controlled trade policy undermines the basic protections that U.S. consumers deserve,” according to Food & Water Watch Executive Director Wenonah Hauter. “The United States should appeal the ruling and continue to fight for sensible consumer safeguards at the supermarket.”

Meanwhile, as the U.S. decides whether to launch a final appeal – something most trade experts agree is a virtual certainty – in the absence of a WTO-compliant solution, both Canada and Mexico have signaled their willingness to impose more than $2 billion a year retaliatory tariffs aimed at a wide range of U.S. exports.

“We will target everything from California wine to Minnesota mattresses, not to mention the over $2 billion in U.S. beef and pork sales to Canada,” Agriculture Minister Gerry Ritz told reporters yesterday.

Canada could be in a position to obtain WTO permission to retaliate as soon as two months from now, but Dennis Laycraft, executive vice-president of the Canadian Cattlemen’s Association, feels a possible trade war isn’t nearly that imminent. “The WTO process takes time and it could be midsummer or fall 2015 before any sanctions are imposed,” he told the Calgary Herald.

The U.S. has 60 days from the date of the decision to appeal if they decide to challenge the panel’s ruling. Afterwards an appellate body would issue a final WTO ruling on compliance which could take an additional 6 months.