WTO Considering Canada’s $3.1 Billion COOL Retaliation Plan

Update: A decision from the WTO on Canada’s COOL retaliation plan is expected on December 7.

The Canadian government is making its case to the World Trade Organization this week on why should be allowed to impose C$3.1 billion per year in retaliatory tariffs on U.S. exports in the dispute over country of origin labeling (COOL).

Mexico is also seeking authorization to implement over US$713 million in sanctions.

The WTO has ruled against the U.S. meat labeling laws on four separate occasions, leaving Canada and Mexico with retaliation as the only card left to play in the extended trade dispute.

An arbitration panel in Geneva is hearing arguments this week on the amount of retaliatory tariffs Canada and Mexico should be allowed to impose. The Americans have estimated the costs related to COOL arbitration at only US$91 million between both countries, which the Canadian Cattlemen’s Association says “disregards any valuation related to segregation of cattle, transportation issues or price suppression in the Canadian market ” — the main problems noted in previous WTO decisions.

In an update on the COOL dispute this week, the CCA noted “as the WTO has already found these issues to be at the core of the COOL violation, the CCA is confident that Canada’s calculations will be strongly considered by the arbitrators.”

Related: WTO Rules Against U.S. COOL for Fourth and Final Time — Canada Seeking Permission to Retaliate

A decision on the authorized amount for retaliation is expected later this fall. It will not be subject to appeal.

At the same time, the CCA is asking all federal parties in the Canadian election to commit to imposing the tariffs the moment Canada is authorized to do so by the WTO, unless the U.S. has repealed COOL and ended the incentive to segregate imported livestock.

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