WTO conclusion tests U.S. commitment to international trade deals

The U.S. commitment to fair trade will be put to the test by the World Trade Organization ruling that the American country-of-origin labelling (COOL) measure discriminates against Canadian livestock and is inconsistent with international trade rules.

The late-June decision shouldn’t have come as a surprise based on last fall’s WTO panel ruling against the U.S. measure. Stalling for time, the U.S. waited until the last minute before appealing the ruling in March. The final WTO verdict was as solid as the 2011 decision.

Agriculture Minister Gerry Ritz told a meeting of farm leaders in Dundurn, Sask., that Canada would push the U.S. to end the discrimination COOL restrictions against its livestock.

Since the start of COOL’s labelling and tracking system in 2008, Canadian livestock and meat sales to the U.S. have dropped by about 50 per cent. Canada tried consultations with the U.S. in 2009 and when that failed to resolve the impasse, took the issue to the WTO.

President Jean Guy Vincent of the Canadian Pork Council said the WTO ruled that COOL “amounted to arbitrary and unjustifiable discrimination against imported livestock, such that they cannot be said to be applied in an even-handed manner. After all this time and after so much damage to our interests, this is such sweet music to our ears.”

The CPC didn’t oppose labelling for consumer information purposes as long as it doesn’t restrict trade, he said. “This decision will require the U.S. to change its legislation in order to comply. The condemnation of discrimination against Canadian feeder pigs and slaughter hogs, as well as beef cattle is confirmed.”

COOL has cost hog producers at least $1.4 billion during the last five years in terms of lower sales and prices, he added.

CPC and the Canadian Cattlemen’s Association have worked with the government to oppose COOL.

CCA president Martin Unrau said the WTO ruling was “an important victory for Canadian cattle producers and we are hopeful that the U.S. will amend the COOL legislation to eliminate the discrimination.

“This is the result that we have been seeking,” Unrau added. “Going forward, the CCA will be working with its U.S. counterparts to develop a solution that eliminates the discrimination of Canadian cattle in the U.S. market.”

COOL has affected billions of dollars of commerce in cattle and beef products since it was implemented in 2008. At a cost of $25 to $40 per head, the current impact of COOL to Canadian producers is approximately $150 million per year.

Canadian Meat Council president Ray Price described COOL as bureaucratic, costly and unnecessary without any contribution to food safety and of little or no benefit to consumers. At the same time, it jeopardized North American competitiveness in the global marketplace and weakened economic growth, investment and job opportunities on farms and in meat-processing facilities across Canada and the United States.

The United States should “act quickly to bring its meat labelling regulations and practices into full conformity with international obligations.”

He noted that COOL ran counter to the spirit of an agreement signed by Prime Minister Harper and President Obama last year on “removing unnecessary regulatory requirements that add costs for manufacturers and for consumers.”

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