U.S. defense of COOL goes to WTO in February

The U.S. government will have its day at the World Trade Organization next month, as its defense of its mandatory country-of-origin labelling (COOL) laws for retail meat is now booked for an oral hearing.

The WTO’s Appellate Body division has scheduled its hearing of the U.S. government’s appeal for Feb. 16 and 17 at WTO headquarters in Geneva, in the wake of a third WTO ruling against COOL in favour of Canada and Mexico.

The Appellate Body, following requests from both Canada and the U.S., has agreed to allow public observation of the hearings, albeit via closed-circuit broadcast in a separate viewing room. Members of the public have until Feb. 4 to apply for seats at the viewing.

The U.S. in November filed its notice of appeal against a ruling by a WTO compliance panel, which in October asked that COOL — as revised by Washington in 2013, following a previous loss at the Appellate Body — be “brought into conformity with (WTO) obligations.”

Appealing the compliance panel ruling brings the COOL case back to the WTO Appellate Body, which in 2012 shot down much of Washington’s appeal of the WTO Dispute Settlement Body’s (DSB) ruling against COOL in 2011.

The U.S., in its notice of appeal, has asked the Appellate Body to review the previous panels’ findings that Washington’s revised COOL rules are inconsistent with the WTO’s Agreement on Technical Barriers to Trade (TBT).

The previous panels found the revised COOL rule to be inconsistent with the TBT Agreement in that it “accords less favourable treatment to (Canadian and Mexican) livestock exports” in a manner that “does not stem exclusively from legitimate regulatory distinctions.”

The U.S., in its notice of appeal, claims the panels erred in ruling that the revised COOL measure “entails an increased record-keeping burden and increased segregation,” that the “current labels provided by the amended COOL measure have a potential for label inaccuracy,” and that “the amended COOL measure continues to exempt a large proportion of muscle cuts.”

Passed by the U.S. government in 2008 and implemented in 2009, mandatory COOL requires country-of-origin labelling for beef, pork, lamb, chicken and goat meat, and certain perishable commodities sold at retail outlets in the U.S.

The U.S. Department of Agriculture’s revisions to COOL in 2013, in the wake of the Appellate Body ruling, tightened COOL’s labeling provisions for muscle cuts of meat. COOL now requires covered products’ labels to include even more specific information about where each production step (birth, raising, slaughter) took place.

The compliance panel in October ruled the revised COOL rule “increases the original COOL measure’s detrimental impact on the competitive opportunities of imported Canadian livestock.”

The impact of COOL on the Canadian cattle and hog sectors was estimated in 2012 to be about $1.1 billion per year, but Canadian livestock groups note that impact has increased since the U.S. amended COOL last year.

Barring any changes to COOL on the horizon, Canada will be able to request WTO authority for retaliatory tariffs against the U.S., if the WTO Appellate Body confirms the compliance panel ruling.

Canada has already made out a shortlist of proposed retaliatory tariffs, targeting U.S. live cattle and hogs and fresh and frozen beef and pork products.

The shortlist also calls for tariffs on U.S. cereal, bread, pasta, frozen potatoes, frozen orange juice, wine, cheese, cocoa, apples, cherries, fowl, maple syrup, ketchup, sugars, glucose and fructose and some other food- and non-food-related wares. — AGCanada.com Network