COOL retaliation threat against U.S. real, but Ritz hopeful it won’t be needed

CALGARY – Federal Agriculture Minister Gerry Ritz says it’s time for the United States to come to terms with country-of-origin labelling rules.

The World Trade Organization ruled Monday that the U.S. labelling requirement, known as COOL, violates that country’s trade obligations. It said the labels put Canadian and Mexican livestock at a disadvantage and rejected a U.S. appeal following a similar ruling last year.

“The rules have been adjudicated, the U.S. was found offside and now it’s up to them to find the fix that makes us happy,” Ritz said Thursday. “We’re now driving the bus. We’re not under it anymore, so we’ll see at the end of the day.”

A committee of the U.S. House of Representatives has already voted to repeal the law, which requires labels that say where animals were born, raised and slaughtered.

Canada will probably be able to impose retaliatory tariffs against the United States by late summer or early fall if Washington doesn’t repeal COOL rules.

“If they don’t come up with the fix to COOL, like repealing it, then that’s our Plan B,” said Ritz.

The extent of retaliatory tariffs would depend on what the WTO would allow, Ritz said. There are 38 commodities already listed that Canada could put tariffs on and the list could grow even higher.

“We would bring our economic model to them as to the hurt that we faced from a livestock perspective — somewhere between $2.5 billion and $3 billion a year — and make the arguments,” Ritz said.

“Hopefully we won’t need it. Hopefully the Americans will decide we’re serious and we’ll get this repealed in short order.”

Canada will not consider going after the United States for damages on behalf of beef and pork producers if the labelling rules are repealed, he said.

“No. It doesn’t serve anybody’s best interest. They’re our first major trading partner, over $700 billion a year back and forth across the border. We want to get back to normalcy as soon as we possibly can.”

Canada and Mexico opposed the law because it causes their animals to be segregated from animals born in the U.S. It’s a costly process that has forced some U.S. companies to stop buying exports.

Congress made the labels mandatory in 2002 and 2008 farm legislation, mostly at the behest of northern U.S. ranchers.

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