USTR indicates that COOL damages are much lower than Canada and Mexico estimated.

  • As previously covered on this blog, the U.S. government continues to develop strategies to cope with the aftermath of a World Trade Organization (WTO) ruling that mandatory country of origin labeling (COOL) requirements unfairly discriminate against meat imports.  Because COOL requirements are statutory in origin, Congress is tasked with repealing or amending the COOL regime to mitigate exposure to trade sanctions.  Canada and Mexico have sought $3 billion in retaliatory tariffs.
  • The United States Trade Representative (USTR) has filed briefs in the WTO dispute, indicating that $3 billion is an overestimate of the damages in this case.  The briefs provide cost models and arguments to support requests by the U.S. that the WTO reject the original values and instead set damages at $43.22 million for Canada and $47.55 million for Mexico.
  • Congress has yet to take final action to repeal or amend the COOL requirements.  The House of Representatives passed a bill to repeal the requirements in June and the Senate is considering a separate bill that would institute a voluntary COOL regime in place of the mandatory requirements.  In light of the significant disparity between Canada’s and Mexico’s estimated damages and the USTR figures, it remains to be seen whether Congress will wait for the WTO’s ruling on the retaliatory tariffs before taking further action.  The WTO has scheduled a hearing on this matter for September 15-16 in Geneva.