It’s a win federal agriculture minister Gerry Ritz could really use right now.
After months of speculation, the World Trade Organization ruled Oct. 20 that the United States had not done enough to bring its controversial meat labelling rules into compliance of international trade rules.
The WTO’s dispute resolution body said in its ruling that mandatory country-of-origin labelling clearly discriminates against Canadian and Mexican livestock exports and favours domestic animals , which is illegal under WTO rules.
COOL, which has been in place since 2008, requires producers and processors to identify where an animal is born, raised and slaughtered.
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The ruling confirms what Canadian and Mexican officials and industry representatives have been arguing for years: COOL is unfair and hurts livestock exports.
This week’s decision is not the first time Canada has won a COOL challenge at the WTO. In July 2012, the same WTO panel found that the initial rule violated international trade law and ordered the U.S. to amend the legislation to bring it into compliance.
Instead, the U.S. tightened the policy, making changes in the spring of 2013 that opponents insisted made COOL even worse.
The U.S. actions would ultimately send the entire argument back to the WTO, where the final strike was issued earlier this week.
The Americans, though, are expected to appeal the decision, which Ritz told reporters Oct. 20 only served to confirm COOL was a “political solution to a problem that doesn’t exist.”
“I think they’ll ride this all the way to the bottom,” Ritz said when asked about the chance of an appeal.
The WTO’s ruling now paves the way for Canada and Mexico to retaliate against the Americans if they don’t comply. Ritz and trade minister Ed Fast have threatened repeatedly that Canada is prepared to impose retaliatory tariffs against more than 30 American products if COOL is not repealed.
Products can be added to Canada’s list if necessary, Ritz said, particularly if one state or spokesperson is proving to be more ornery on the issue than others.
Mexico has yet to release a list, but Ritz told reporters Mexican officials would likely release more information once the appeal process is underway. Canada, meanwhile, will use the next few months to prepare retaliatory options.
Conversations with the Americans are not off the table, Ritz said, but only with a willing counterpart who understands the detrimental impact COOL has had on this country’s livestock sector.
Canada is not prepared to negotiate, he said, nor should it have to. The WTO’s ruling is clear, Ritz said.
A full repeal of the rule is the only option Canada is willing to consider.
The government will “not blink” on the issue, Ritz said, a commitment that triggered praise from both the Canadian Cattlemen’s Association and the Canadian Pork Council.
Still, there’s much work to be done.
While the WTO’s decision to rule in Canada’s favour was not unexpected, all eyes will be on the government’s next moves: words must be backed by action.
Ritz has committed to a full repeal of COOL, which is believed to be costing the Canadian beef and pork industry more than $1 billion a year. While the minister has talked tough on the file before, the Americans for the most part have continued to stall.
And, while there is a growing movement in the United States to address the COOL issue, Ritz must ensure that the solution meets the needs of Canadian producers first. Canada’s integrated beef and pork industries depend on it.
Ritz must use every avenue available to him to convince his American counterparts to take this situation seriously, if he hasn’t already. Lobby efforts must be maintained, capitalizing on the recent processing plant closures and American calls for COOL’s repeal.
And, as opposition members suggested repeatedly in conversation Oct. 20, if a meeting between the prime minister and the president on COOL will help, it should be considered.
There is no question winning again at the WTO is a step in the right direction. Still, one cannot forget that Canada has won in that arena before, only to have the Americans turn around and tighten COOL’s grip.
The COOL tides may be shifting, but the risk of political games has not waned. One might argue the risk of politics trumping reason is actually higher given the ongoing political climate.
With election campaigns well underway on both sides of the border, the likelihood of folks digging in their heels is rising by the day, regardless of what the WTO has to say.
Ritz has said COOL has to go. Now it’s time for him to keep his word.
