Labor, Consumer Groups Reject COOL Repeal as House Readies for Vote
Nearly 300 labor unions and consumer groups railed against efforts to repeal U.S. country-of-origin labeling for meat muscle products in a June 8 letter, only days after a top Canadian official threatened to retaliate as quickly as possible over the dispute. COOL has caused “negligible at most” harm to Canada and Mexico, said the letter (here), which was endorsed by the AFL-CIO, Public Citizen and other high-profile groups.
Sign up for a free preview to unlock the rest of this article
If your job depends on informed compliance, you need International Trade Today. Delivered every business day and available any time online, only International Trade Today helps you stay current on the increasingly complex international trade regulatory environment.
House Republican leadership is aiming to vote on COOL repeal on June 12 (see 1506080013). House Agriculture Chairman Mike Conaway, R-Texas, introduced the repeal bill, HR-2393 (here), and led the legislation to approval at the committee vote (see 1505210017). COOL experts say the Senate will be a bigger obstacle in the repeal effort (see 1505270016).
In late May, a World Trade Organization body rejected the final U.S. appeal in the dispute (see 1506010047), but the letter dismissed the need to act quickly to avert retaliation. “The United States has a sovereign right to allow the dispute process to proceed to its completion and then decide how and whether to implement the adverse ruling,” said the letter. “It is premature for the Congress to unilaterally surrender to saber-rattling from our trading partners in the midst of a long-standing dispute.”
The World Trade Organization Dispute Settlement Body will hold a meeting on June 17 to consider Canadian and Mexican efforts to move forward with retaliation over U.S. country of origin labeling, the WTO confirmed (here). This stage in the process may launch negotiations on "mutually acceptable compensation." If the U.S. doesn't reach an agreement on that compensation with Canada and Mexico within 20 days of the expiration of a "reasonable period of time," which is determined through negotiations between the parties involved, then Canada and Mexico will move a step closer to retaliation. The WTO process is still expected to take roughly three months at minimum (see 1505270016).
Canadian Agriculture Minister Gerry Ritz said recently that COOL caused more than $3 billion in damages to the Canadian economy and roughly $650 million to the Mexican economy (see 1506050016). “These unapproved, unrealistically high retaliation claims are merely aggressive litigation tactics,” said groups in the letter. "Congress should not fall for it. The WTO can only authorize penalties based on the extent to which COOL caused a reduction in the volume and price of livestock imports. But the economic recession was the driving factor behind declining livestock imports, not the application of a simple label.” The WTO awards authorization for an amount of retaliatory tariffs based on the precise economic harm involved.
The Canadian retaliation list targets not only agricultural products, but also processed foods, jewelry, articles of iron or steel, furniture and other products (see 13061022). The Mexican government hasn’t yet published its retaliation list, the goods will likely resemble those targeted in the NAFTA cross-border trucking dispute, which the two sides resolved in 2011. That list includes a range of agriculture products, beauty and hygiene products, gas masks and plastic tableware, among many other goods.