December 2, 2008
The Canadian government is asking the World Trade Organization for consultations with the US about recently implemented country-of-origin labelling legislation.
The US labelling law, known as COOL, was implemented on September 30 and requires meats to be labelled, identifying the birth country of the animal from which the meat was produced.
"While Canada is firmly committed to a cooperative trading relationship, we believe that the country-of-origin legislation is creating undue trade restrictions to the detriment of Canadian exporters," Stockwell Day, minister of international trade, said in a press release Monday. "Under these circumstances, Canada has no choice but to assert its WTO rights in the defence of our exporters."
Gerry Ritz, minister of agriculture and agri-food, said in the release that the consultation was a formal opportunity to work with the US to resolve the issue and to send a "strong signal that we will stand up for Canadian producers and exert our rights if necessary."
If the WTO consultations fail to resolve the issue, the matter can be referred to a WTO dispute settlement panel.
Ritz said a government-industry working group is monitoring the implementation of COOL to collect information on its economic impact on Canadian livestock and meat industries.
Canadian producers have already indicated that COOL is having a negative impact on livestock and meat exports.
The Canadian Cattlemen's Association said it supports the government's request for consultations, saying that the implementation of COOL has impeded Canada's ability to market livestock in the US.
The cattlemen's group, in a separate press release, said many US meatpacking plants are refusing to accept Canadian cattle in order to minimise labelling-related costs. The CCA said the few US companies continuing to process Canadian cattle are discounting those cattle and some are also limiting their acceptance of Canadian cattle to certain days.
The US COOL law results in approximately a C$400 million (US$319.144 million) annual loss to the Canadian cattle industry, the CCA said.