Canada, Mexico Seek COOL Retaliation

WASHINGTON (DTN) -- The Canadian and Mexican governments are expected to take their requests to retaliate against the United States over country-of-origin labeling for beef and pork to the World Trade Organization in Geneva on Wednesday.

WTO panels have ruled four times against the U.S. program on the grounds that it discriminates against Canadian and Mexican producers because it requires segregation of animals during the slaughter process in order to comply with labeling requirements.

At a news conference Tuesday sponsored by the Global Business Dialogue and the National Pork Producers Council, U.S., Mexican and Canadian opponents of labeling called on the Senate to follow the House and repeal the labeling program.

Canada is asking for the right to put increased tariffs on $2.4 billion in goods, and Mexico is asking for the right to put the tariffs on more than $700 million in goods, officials said at the event.

The United States will have the right to object to the request, and the Office of the U.S. Trade Representative has said the U.S. government will exercise that right.

But Canada and Mexico could gain the right to impose the retaliatory tariffs as soon as August, said David Bond, a trade lawyer with White & Case, at the news conference.

Randy Russell, a lobbyist who represented an anti-labeling U.S. meat coalition, said the tariffs would amount to a "COOL tax on U.S. products."

Ken Smith Ramos, head of the Mexican Economy Ministry's office in charge of trade and the North American Free Trade Agreement, said COOL violated "one of the most important accomplishments of NAFTA," the increasing efficiency of the supply chain."

"People talk a lot about autos, but supply chain efficiency and integration also apply to livestock," Smith Ramos said.

John Masswohl of the Canadian Cattlemen's Association said his country's producers are not interested in compromise.

"We are ready for this to be fixed, but we are not desperate," Masswohl said. "We want the right fix. We are not looking for just any compromise, a middle path."

Masswohl said Canadian producers have spent $3.25 million on legal fees and lobbying, and COOL has cost Canadian cattle and hog producers $3 billion per year.

"We have not come through this to settle for half a loaf," Masswohl said.

Ken Monahan of the National Association of Manufacturers said it is important for the United States to comply with the ruling in order to be a leader in world trade.

Although the House has passed a repeal measure, Senate Agriculture Committee ranking member Debbie Stabenow, D-Mich., has said she does not favor repeal, and Senate Agriculture Committee Chairman Pat Roberts, R-Kan., has said he favors a bill that will pass the Senate.

(AG/CZ)

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