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Key Topic – COOL Dispute with Canada, Mexico

COOL Dispute with Canada, Mexico – Effective Nov. 23, 2013, packers were required to implement revised country-of-origin labeling (COOL) requirements. But these COOL regulations were successfully challenged by Canada and Mexico through the WTO compliance review process. Once the compliance review panel decision was upheld by the WTO Appellate Body, it could have had severe consequences for the U.S. meat industry if it led Canada and Mexico to implement retaliatory tariffs on imports of U.S. beef and pork. U.S. red meat exports to Canada and Mexico make up about one-third of the worldwide total.

On Dec. 7, the WTO Dispute Settlement Body issued a ruling authorizing about $1 billion in retaliation (roughly $780 million for Canada and $228 million for Mexico). This is far less than requested, as Canadian officials sought authorization of C$3 billion (about $2.3 billion in U.S. dollars) in retaliatory measures, while Mexico requested $653 million. The WTO has scheduled a meeting for Dec. 18 to give final authorization for retaliatory measures.

UPDATE: With the deadline looming to avoid retaliation by Canada and Mexico, a provision repealing COOL requirements for beef and pork was included in the omnibus spending bill passed Congress on Dec. 18. USDA immediately suspended enforcement of COOL regulations for beef and pork, and this will likely allow the United States to avoid any retaliation by Canada or Mexico.