WTO authorizes $1 billion in retaliatory tariffs for COOL law
The World Trade Organization (WTO) ruled Monday that Mexico and Canada can slap more than $1 billion in tariffs on US products in retaliation to the mandatory country-of-origin labeling (COOL) law on meat that the international trade regulator says discriminates against the bordering countries’ livestock.
Monday’s ruling allows Canada to impose $777 million a year in tariffs and Mexico $228 million a year.
The country-of-origin labeling law, or COOL law, would require a label to be placed on meat packages detailing where an animal was born, raised and slaughtered. Consumer groups lobbied for the rule, but Canada and Mexico complained about it to the WTO, which sided with them. Labels were first implemented in 2009 to provide shoppers more information about the origin of their meat. The labels were then updated in 2013. The recent decision puts pressure on Congress which is considering a repeal of the controversial law. Some legislators hope to sneak in a repeal into a year-end bill.
Representatives in the food industry were upset by the recent news and called for a repeal. The North American Meat Association referred to the decision as a “lump of coal” to kick off the holiday season.
“Mandatory COOL is one of the most costly and cumbersome rules ever imposed on the agricultural sector and today’s announcement sets in motion Canada’s and Mexico’s ability to impose tariffs, a move they will likely complete before Christmas,” says Barry Carpenter, NAMI president and CEO. “Soon, a host of industries, ranging from cherry producers to maple syrup processors to wooden furniture and mattress makers, could pay the penalties for this debacle created by some anti-trade organizations who fought for the law.”