America’s County of Origin Labeling (COOL) requirements for retail sales of meat and certain perishable commodities are in danger of being declared unfair trade practices.

The World Trade Organization (WTO) agreed this week to set up a dispute settlement panel to resolve Canada’s challenge of the mandatory COOL requirements imposed under the 2008 Farm Bill by the U.S. Congress.

made-in-canada.jpgThe U.S. blocked Canada’s October request for a dispute settlement panel, but the use of the block can only be used once.  When Canada again made the request, it was granted Thursday by WTO’s Dispute Settlement Body.

The government of Canada maintains the COOL requirements have resulted in greater costs for processors who must segregate Canadian animals and meat in order to comply with the new law.  As a result some processors no longer buy Canadian animals or only buy them on certain days at a discounted price.

Canada argues COOL is making both its beef and pork less competitive because of the additional requirements and costs.

On the other side, the United States says county of origin labeling pre-dates WTO and has long been a legitimate policy.

The Food, Conservation and Energy Act of 2008, also known as the Farm Bill, includes the COOL requirements as a mandate at the retail level for beef, lamb, pork, chicken, goat, perishable agricultural commodities and certain nuts.

The statute has four categories for origin of meat: 1.) Exclusive U.S. origin; 2. ) Multiple countries of origin; 3.) Animals for immediate slaughter; and 4.) Exclusively foreign origin.

The U.S. Department of Agriculture published a final interim rule to implement COOL on Aug. 1, 2008.  Canada first asked for WTO dispute settlement on Dec. 17, 2008.  USDA’s final rule became effective on March 16, 2009.

Canada and Mexico have sought changes ever since. “We continue to stand up for the rights of Canadian producers during the dispute settlement process and make the case that the U.S. should lift these onerous requirements, ” says Canada’s International Trade Minister Stockwell Day.

WTO dispute panels typically take about nine months to go through their process and issue a report.

US imports of Canadian livestock are 34 percent lower for the first six months of 2009 compared to the same period of 2008, USDA reports.

  • Zithulele Balindlela

    One may argue that as tarrifs come down, the countries are finding other alternatives to protect their industries or sectors. These measures include SPS, TBT as well as regulations and procedures i.e. this COOL rule. We talk of globalisation where we see world as one, so why do we need to have policies such as COOL? Although the documented intentions of COOL are good but in reality it is likely to negatively affect trade. Economics dicates that decision making process of consumers is large influenced by price of the product and disposable income ( all those determine affordability), however, there are other factors that may affect the decission making process of the consumers such as religion, tastes, information available on the label like country of origin, ingredients etc. Therefore, what is likely to happen with COOL is, the people/consumers will use a wrong perception that they have about the country exporting and associate it with products originating in that country. For example if certain country is known of risk the consumers wont buy products from that country or else where products are mixed and all countries are labelled as countries of origins then any negative perception will affect all the countries listed on the label. Again, products produced in developed world are regarded as of best quality. Thus, products produced in developed countries are perceived as high quality and having a greater prestige than those from developing countries. Therefore, products produced in developing countries are likely to be sidelined by consumers.
    It has been stipulated that country of origin does affect the consumer decision making process in the following forms:
    • stimulates the consumer’s interest in the product
    • patriotism i.e. where consumer opts for locally produced over imported product
    • attitude i.e. consumers’ attitude or knowledge about the country of origin
    Therefore, we can expect the same results from COOL but let’s put everything on the “shoulders” of the WTO DSU panel.

  • cf

    I have the right to know where my food comes from. A RIGHT.
    Most people I talk with feel exactly the same.
    A lot of excuses given.
    The truth- protecting those who use less than acceptable foods, ingredients from countries that do not follow safe standards.
    Country of origin labels need to be mandatory for safety more than merely for choice