A World Trade Organization panel heard evidence from Canadian producers last week about how U.S. country- of-origin labelling hurts them.
“We think it is between $30 and $40 a head in a price hit,” Canadian Cattlemen’s Association president Travis Toews said after returning from speaking to the WTO dispute resolution panel in Geneva. “It has had a real impact.”
Gary Stordy, communications manager for the Canadian Pork Council, said CPC representatives noted the decline in exports to the United States since the COOL rule took effect.
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“It is not just the price hit but also the ability to market,” he said.
The panel, established in May with representatives from Switzerland, Pakistan and Portugal, is scheduled to rule by next July on whether COOL is an illegal trade restriction.
An almost certain appeal by the losing side is expected to take the dispute well into 2012.
“It is a lengthy, onerous, resource-draining process,” Toews said.
“We already have spent well in excess of half a million dollars and while most of the expenses may be behind us, it depends what path this dispute takes.”
He said it is a costly legal fight that is possible only because of revenues raised from sometimes-controversial producer checkoffs on cattle sales.
Costs include legal fees and collecting the data that the Canadian government needs to convince the WTO that COOL distorts trade and damages Canada.
He said the panel members had probing questions for Canadian and U.S. presenters.
“I wouldn’t call them skeptical but probing, thoughtful questions.”
Toews said the Canadian government’s presentation of Canada’s case was solid and compelling.
He said the United States argued that COOL is simply consumer information policy. If the rule is having a negative impact on Canadian exporters, it is because of consumer choices and not government policy.
Toews said the American arguments were not a surprise but the hearing was a clear indication that the U.S. will vigorously defend its position.
The next step for Canada will be to provide written answers to panel questions, attend another hearing in December and provide final written submissions before the panel begins to work on its decision after February.
He said if Canada wins, Canadian opponents of COOL will work with American allies who are hurt by the import restriction to have the rules changed.
