Race heats up to find COOL solution

Thursday, July 23, 2015

by SUSAN MANN

With its latest attempt to revise Country of Origin Labelling legislation nixed by the Canadian government, the United States is running out of time to find another way to fend off $3 billion in retaliatory tariffs on the goods it ships to Canada, a measure slated to come into effect in the fall.

Earlier this week, U.S. Senator Debbie Stabenow of Michigan proposed a bill to replace the current mandatory Country of Origin Labelling (COOL) law with a voluntary rule. Both the Canadian government and livestock industry groups condemned it.

The voluntary COOL program as proposed by Senator Stabenow is unacceptable as it maintains segregation, the Canadian Cattlemen’s Association says in a July 23 news release.

The association also applauds the Canadian government’s “unwavering focus on implementing retaliatory tariffs” if the Americans don’t comply with World Trade Organization (WTO) rulings to ensure their law complies with their international trade obligations. The United States is a member of that international trade body.

Jeff English, communications director for federal Agriculture Minister Gerry Ritz, says to avoid retaliation the Americans need to repeal the red meat requirements of the COOL legislation “before the fall.”

The arbitration process before the WTO where Canada and Mexico are seeking authorization to retaliate “is still going forward,” English says, noting Canada is hopeful the Americans will act and repeal COOL before the process is completed but “the foot’s not off the gas with respect to the WTO.”

English says they’re hopeful the Senate will pass legislation similar to what the House of Representatives did in June when it approved a law immediately repealing the mandatory COOL by a 300 to 131 vote.

An amendment introduced by Kansas Senator Pat Roberts, chair of the Senate agriculture committee, on July 23 is similar to the House of Representatives legislation that passed there. English says that amendment was added to “another bill” and if it passes it would be an acceptable fix to the mandatory COOL legislation.

Dave Solverson, Canadian Cattlemen’s president, agreed. He didn’t know when the Senate would vote on the amendment and he’s concerned because it might not have enough votes to pass. Repealing COOL has become “quite a divisive issue,” he adds.

The Senate is scheduled to recess for summer vacation soon so the vote could occur fairly quickly, he notes.

Canadian Cattlemen’s says in its release that passing the Roberts amendment, which follows the House of Representatives action to repeal mandatory COOL, would mean the United States reaches compliance with its international trade obligations.

Solverson says he can see a light at the end of the tunnel. American senators now understand the mandatory COOL legislation needs to be fixed whereas earlier in the year when he was last in Washington D.C. “there were still some senators that figured they were compliant with the WTO rulings.”

In May, the WTO Appellate Body issued a final ruling confirming the unfair, discriminatory nature of COOL and reaffirming three previous WTO decisions stating the legislation violates U.S. international trade obligations.

Meanwhile at the WTO, Canada is seeking permission to slap more than $3 billion a year in retaliatory tariffs on American exports to Canada, the release says. Mexico is requesting authorization for more than US $173 million in retaliatory tariffs.

English says Canada’s dollar figure is the estimated annual loss to Canadian cattle and hog producers due to COOL. Despite an American challenge of the number, “we’re pretty confident, obviously” the WTO will accept Canada’s estimate of damages.

English says the Canadian government published its list of proposed American products facing tariffs in 2013. “That’s still the list.” Agriculture Minister Gerry Ritz has said the government can add to or subtract from the list “depending on what makes sense,” English notes. BF