GENEVA—The World Trade Organization (WTO) Appellate Body on June 29 issued its final ruling on Country of Origin Labeling (COOL) that originally was released in November 2011 and appealed by the U.S. Trade Representative in March 2012. While the ruling confirmed the right to require labeling on fresh beef and pork, it said U.S. COOL is not compliant with the U.S.-WTO agreement on technical barriers to trade (TBT) and provides "less favorable treatment to imported Canadian cattle and hogs."
The COOL measure, launched in the 2008 Farm Bill, requires country of origin labeling for covers muscle cuts and ground beef, lamb, chicken, goat and pork; wild and farm-raised fish and shellfish; perishable agricultural commodities (specifically fresh and frozen fruits and vegetables); macadamia nuts; pecans; ginseng and peanuts. Canada and Mexico challenged the measure in 2008, on the grounds it was discriminatory.
On Nov. 18, 2011, WTO ruled in support of complaints by Canada and Mexico that U.S. country-of-origin labeling (COOL) labeling on fresh beef and pork violates global trade rules and unjustly harms agricultural commerce. The U.S. Trade Representative appealed the ruling in March 2012.
In its ruling last week, the Appellate Body agreed with the Panel that the COOL measure has a detrimental impact on imported livestock because its recordkeeping and verification requirements create an incentive for processors to use exclusively domestic livestock, and a disincentive against using like imported livestock. The Appellate Body also found that the COOL measure “lacks even-handedness because its recordkeeping and verification requirements impose a disproportionate burden on upstream producers and processors of livestock as compared to the information conveyed to consumers through the mandatory labeling requirements for meat sold at the retail level."
The ruling also stated “only a small amount of this information is actually communicated to consumers in an understandable or accurate manner, including because a considerable proportion of meat sold in the United States is not subject to the COOL measure's labeling requirements at all."