Burdensome Country-of-Origin Labeling Rule Will Not Satisfy WTO or Trading Partners, But Will Harm U.S. Agriculture
Thursday, May 23, 2013
USDA’s ‘Rubber Stamp’ of Proposed Rule Despite Extensive Concerns From Impacted Companies and Key Trading Partners Is Incomprehensible, Reckless
Washington, DC – A USDA Agricultural Marketing Service (AMS) decision to finalize a March 12 proposed rule on country-of-origin labeling (COOL) for meat and poultry products with no changes despite a massive outpouring of concern from affected companies and major trading partners is incomprehensible and recklessly disregards the potential adverse retaliatory trade responses from Canada and Mexico, said the American Meat Institute (AMI).
Mandatory COOL has been mired in controversy since a World Trade Organization (WTO) panel, in response to complaints by Mexico and Canada, determined that the 2009 version of the rule violated United States’ WTO obligations. USDA proposed a new rule in March 2013 that it claimed would bring the U.S. into compliance, but the proposal was far more burdensome than the original 2009 rule, now in effect.
“It is incomprehensible that USDA would finalize a controversial rule that stands to harm American agriculture, when comments on the proposal made clear how deeply and negatively it will impact U.S. meat companies and livestock producers. This rubber stamping of the proposal begs the question of the integrity of the process: many people spoke, but no one at USDA listened,” said AMI Senior Vice President of Regulatory Affairs and General Counsel Mark Dopp. “The decision to proceed with a rule that is more costly, complex and burdensome than the earlier version, when WTO and our trading partners have sent strong signals that this is no ‘fix,’ shows a reckless disregard for trade relations and for companies whose very survival is at risk because they rely upon imported livestock.”
“If it wasn’t obvious previously that politics were driving USDA’s COOL rule, it is painfully clear now,” Dopp added.
In its comments, AMI detailed how many member companies will be significantly and adversely affected by the proposal. In 2009, meat and poultry processors and retailers were required to apply country-of-origin labels to packages at an estimated cost of as much as $500 million to the meat sector in the first year alone due to costly segregation of livestock, record-keeping and new packaging.
AMI also told USDA/AMS
that if the
existing mandatory COOL rules are amended
according to the proposal, there is a
virtual certainty that several meat packing
establishments will ultimately
close because of the costs they will be forced
to incur in order to implement
the proposal’s requirements.
“In effect, the agency
is picking
winners and losers in the marketplace in order
to provide information to
consumers that recent research shows they care
little about and do not wish to
pay for,” AMI said. Operations on the
northern and southern borders would be
impacted most severely because their businesses
are premised on free trade in
meat and livestock across international
borders, and the new rule will have a
particularly burdensome impact on them in terms
of segregation and labeling,
which suggests that the U.S. government is
essentially picking winners and
losers in the international
marketplace.
###
AMI
represents the interests of packers and
processors of beef, pork, lamb, veal
and turkey products and their suppliers
throughout North America. Together,
AMI’s members produce 95 percent of the beef,
pork, lamb and veal products and
70 percent of the turkey products in the United
States. The Institute provides
legislative, regulatory, public relations,
technical, scientific and
educational services to the meat and poultry
packing and processing
industry.
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