WTO rejects U.S. appeal of COOL ruling.

  • In 2013, the U.S. Department of Agriculture (USDA) implemented country of origin labeling (COOL) rules, requiring meat labels to indicate where animals were born, raised, and slaughtered.  Meatpacking and livestock commodity groups in the U.S., Canada, and Mexico challenged the COOL requirements via appeal to the World Trade Organization (WTO) and a lawsuit filed in the U.S. (alleging that the requirements infringe First Amendment rights).  In October 2014, the WTO ruled that the COOL requirements violate U.S. trade obligations to Canada and Mexico, but U.S. federal courts consistently have upheld the requirements.  The U.S. meat industry plaintiffs ultimately dropped their lawsuit, but the U.S. appealed the WTO ruling.
  • The WTO has now rejected the U.S. appeal of its decision that existing COOL requirements create an uneven playing field in the meat trade by discriminating against imports while providing an advantage to domestic producers.  Now that this final ruling has been issued, the U.S. must either repeal or amend the COOL requirements to avoid trade sanctions from Canada and Mexico.
  • Because USDA’s COOL requirements implement statutory provisions, it seems that only a legislative fix will address the trade implications here.  It now remains to be seen whether Congress will act swiftly enough to avoid retaliatory tariffs by Canada and Mexico.