TIA Signs onto Letter of Concern over COOL Rule

The Transportation Intermediaries Association (TIA) joined other industry stakeholders by signing on to a letter of concern to Congress, in regard to the U.S. Mandatory Country of Origin Labeling (COOL) rule for muscle cuts of meat. On October 20, 2014, a World Trade Organization (WTO) Compliance Panel released a report determining that the rule violates obligations the United States has undertaken as a member of the WTO with regard to our two largest export markets, Canada and Mexico. While there is an opportunity for the United States to appeal this decision, final adjudication should occur early 2015. At that time, if the Compliance Panel’s original findings are found to be valid, both Canada and Mexico could subject an array of U.S. exports to retaliatory tariffs. A finding of non-compliance would surely result in serious economic harm to U.S. firms that export to our neighbors.

Canada has already issued a preliminary retaliation list targeting a broad spectrum of commodities and manufactured products that will affect every state in the country. Mexico has not yet announced a preliminary retaliation list, but has implemented retaliatory tariffs in the past which may be indicative of future tariff opportunities. It is expected that U.S. industries would suffer billions in lost sales if retaliation is allowed.

The draft letter contained the following statement: 

Given the negative impact on the U.S. manufacturing and agriculture economy, we respectfully submit that it would be intolerable for the United States to maintain, even briefly, a rule that has been deemed non-compliant by the WTO. With little potential for quick Congressional action after a WTO final adjudication, we request that Congress immediately authorize and direct the Secretary of Agriculture to rescind elements of COOL that have been determined to be non-compliant with international trade obligations by a final WTO adjudication. Such action by Congress would not undermine COOL to the extent COOL is consistent with international trade obligations nor would it weaken the U.S. defense of COOL in WTO litigation.