On March 28, Canada and Mexico filed counter appeals in their World Trade Organization (WTO) dispute challenge to the United States mandatory country of origin labeling (mCOOL) regulations for meat. The two appeals, which were circulated to WTO members on April 2, came within a week after the United States filed its own appeal against a WTO dispute panel ruling condemning provisions of the mCOOL rules established under the U.S. Food Conservation and Energy Act of June 2008.

On November 18, 2011, the WTO announced that the WTO dispute settlement panel decided to agree with Canada and Mexico that the mCOOL requirements violate Article 2.1 of the WTO’s Agreement on Technical Barriers to Trade (TBT) by treating imported livestock less favorably than domestic livestock.  The panel also agreed with Canada and Mexico that the mCOOL requirements violated Article 2.2 of the TBT Agreement because it does not fulfill the stated U.S. objective of providing consumer information on origin with respect to meat products.  Canada and Mexico are both challenging the panel’s findings that the objective of the mCOOL measure is legitimate under Article 2.2.  They are challenging even though the panel added that the mandatory labeling requirement violated Article 2.2 fell short of the U.S. objective of providing consumers with information on the country of origin of meat in an accurate and clear amount.

Canada and Mexico also made a number of conditional appeals should the WTO’s Appellate Body overturn the panel’s early findings.  Both countries argued that even if the Appellate Body agrees with the United States that the mCOOL measure does fulfill the U.S. objective of providing clear and accurate consumer information, mCOOL should, nevertheless, be ruled illegal because the United States could have resorted to less trade-restrictive measures to achieve its consumer information objectives.

Article 2.2 of the TBT requires WTO members to ensure that technical regulations are not adopted or applied with a view creating unnecessary obstacles to trade, and that technical regulations not be more trade-restrictive than necessary to meet a legitimate objective.  In its appeal filed March 23, the United States argued the WTO panel erred in ruling that mCOOL requirements treat imported livestock differently than domestic livestock.  Further, the requirements should not accord less favorable treatment to imported livestock than that accorded to domestic livestock by modifying the conditions of competition to the detriment of imported products.

The United States also charged the panel erred in finding the mCOOL measure is trade restrictive and that the mCOOL requirements do not fulfill the legitimate objective at the level the United States considers appropriate.  The United States also charged the panel erred in failing to consider all relevant information regarding the U.S. chosen level of fulfillment to legitimate consumer information objective of mCOOL, and failing to require Canada and Mexico to meet their burden to prove that the measure is more trade-restrictive than necessary.   The WTO Appellate Body is likely to issue its ruling on the claims by the end of June 2012.

 

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