U.S. country-of-origin labelling provisions violate global trade rules and unjustly harm agricultural commerce, World Trade Organization judges ruled, backing complaints by Canada and Mexico.
The U.S. requires food processors to identify the countries from which cattle, hogs and some fresh produce originate. Canada and Mexico argue that the provisions impose unfair costs on their exports, reducing their competitiveness. Judges agreed that the policies meant beef and pork from Canada and Mexico were treated less favorably than the same U.S. products.
Judges recommended in their 215-page report on the Geneva- based WTO’s website that the U.S. be told “to bring the inconsistent measures into conformity with its obligations.”
Today’s ruling may affect as many as 70 other WTO members, including the European Union, that also have mandatory labeling requirements. The U.S. has 60 days to appeal.
Canada and Mexico lodged their complaints in December 2008, challenging provisions of the U.S. Food, Conservation and Energy Act that impose mandatory country-of-origin labeling for beef, pork, chicken, lamb and goat as well as some perishables sold by U.S. retailers.
Canada’s trade department has said U.S. processors are forced to segregate Canadian animals and meat, leading some to shun those products due to the extra costs. Canada and the U.S. traded C$37 billion ($36 billion) of agricultural goods in 2008.
Country of Origin Labeling, known as COOL, has caused many U.S. pork-processing companies to stop buying animals born in Canada and has cost the country’s pork industry millions of dollars, according to the Canadian Pork Council, a federation of nine provincial pork industry associations. The law costs the Canadian cattle industry C$400 million annually, the Canadian Cattlemen’s Association says.
Mexico said when it filed its complaint that COOL was “significantly” affecting its bovine industry. Most of Mexico’s cattle exports go to its northern neighbor.
In the EU, compulsory country of origin labeling applies to beef, fruits and vegetables, honey and olive oil. New regulation extends that to fresh meat of swine, sheep, goats and poultry.
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