In November, a WTO panel agreed that the United States has the right to require country of origin labeling (COOL), as long as it is to provide consumers with information, and not for protectionist reasons, but it found that current COOL requirements afford less favorable treatment to imported livestock than domestic livestock, and that the policy“does not fulfill the objective of providing consumer information on origin with respect to meat products”.
Among other issues, the United States said it disagrees that its COOL labeling creates a disadvantage for imported products because it“requires meat derived from both imported and domestic livestock to be labeled under the exact same set of circumstances.”
The Canadian government said that US COOL measures have forced Canadian exports to go through a lengthy labeling and tracking system, which it claims has led to the disintegration of the North American supply chain. Under the system, US meat processors have been required to handle and label Canadian products separately, leading many of them to simply exclude Canadian products. Moreover, Canadian producers have said that the rules have produced a glut on local markets, thereby depressing prices.
According to the appeal document:“The COOL requirements apply the same recordkeeping requirements to market participants who handle imported and domestic livestock, and meat derived from both types of livestock is required to be labeled with its origin in the same set of circumstances, regardless of what that origin may be.”
In addition, it claims that“the Panel errs in its analysis of crucial facts related to segregation, commingling, and the price differential in the US livestock market.”
The United States is Canada’s biggest export market for cattle and hogs, and Canada said its cattle exports were down 23% and hog exports were down 34% from 2007 to 2009.
Canada first requested WTO involvement in December 2008, alleging that the COOL system had damaged its export market.
Country of origin labeling is required on all beef, chicken, pork, lamb, goat, and fish sold at US grocery stores, as well as on perishable agricultural commodities, ginseng, macadamias, pecans and peanuts.
The United States’ appeal document is available as a PDF by clicking here.