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US environmental, consumer choice legislation hammered by WTO

The COOL Double-Down: Conservative ministers Gerry Ritz and Ed Fast sandwiched by Canada’s pork and beef industry presidents

What the Conservative government hailed last week as a major WTO victory, U.S. consumer and public advocacy groups mourned as yet another attack on democracy by corporate trade deals.

On November 18, DFAIT “welcomed the clear victory for Canada’s livestock industry represented by the WTO ruling that the U.S. Country-of-Origin Labelling (COOL) measure is inconsistent with its WTO trade obligations.” The COOL legislation, introduced in September 2008, required meat that was processed in the U.S. but from Canadian-raised livestock to be labelled as Canadian rather than North American as had been the case.

Large transnational industry groups in Canada and Mexico, including the highly integrated (Canada-U.S.) pork and cattle sector in Canada, claimed the policy cost too much and was against the laws of international trade. But public interest groups in the U.S., including Council of Canadians allies Food and Water Watch and Public Citizen, said COOL was a “highly popular” and helpful measure designed to increase consumer choice at the grocery store.

“Today’s ruling makes very clear that these so-called ‘trade’ pacts have little to do with trade between countries and a lot to do with our major agribusiness corporations being free to sell mystery meat in the United States, with neither consumers nor our elected representatives in Congress able to ensure its safety, much less even know where it is from,” said Lori Wallach, director of Public Citizen’s Global Trade Watch, in a press statement following the announcement of the WTO rulling.

Wenonah Hauter, executive director of Food and Water Watch, said, “”The WTO should not get to decide what U.S. consumers get to know about their food and should not be able to undermine rules put in place by U.S. elected officials. We urge the Obama Administration to stand up for U.S. consumers and farmers and appeal the WTO ruling on country of origin labeling (COOL) for food.”

Public Citizen points out the (not so) COOL decision follows two other WTO rullings this year against U.S. environmental protection and public health policy. On September 15, the WTO’s dispute settlement body found with Mexico that a voluntary U.S. labelling scheme designed to reduce dolphin deaths by corporate tuna fishers–the so-called dolphin-safe label–discriminated against Mexican fishing fleets which do not meet the standards required to earn the dolphin-safe status.

“Initial reports indicate that the Obama administration will appeal the ruling,” wrote Public Citizen at the time, “although the track record of successful appeals is very limited and the WTO rules against challenged policies 90 percent of the time.

“The broader worry,” said the organization, “is that this ruling leaves the door wide open to attacks on similar environmental and consumer policies – not only in the U.S., but all WTO member countries.”

Only a week before the official dolphin-tuna rulling, the WTO declared that U.S. measures designed to reduce teen smoking by banning flavoured cigarettes were illegal under global trade rules. Indonesia argued that by leaving menthol off the list of banned flavours, the policy discriminated against exports of Indonesian cigarettes — even if the intention was not to discriminate.

Here’s Public Citizen again:

The justification for these exclusions was that, unlike candy flavored or clove cigarettes, large numbers of adults are also hooked on regular and menthol cigarettes. To abruptly pull these products out of the market could cause a strain on the U.S. healthcare system (as lifetime addicts would instantly seek medical treatment for wrenching withdrawal symptoms) and might lead to a rise in illicit black market sales and associated crime. Nonetheless, various studies were ordered on the feasibility of banning menthol cigarettes in the future.

The trio of cases against the U.S. using the WTO’s Agreement on Technical Barriers to Trade (TBT) should be a warning to Canada and the EU, which may negotiate an even more corporate-friendly TBT chapter in their Comprehensive Economic and Trade Agreement (CETA). These rullings show that even popular and legitimate public health and environmental measures will regularly fail before trade panels which have much greater power to overturn government policy than do multilateral environmental agreements, for example.

“The Obama administration is in the process of negotiating its first-ever trade deal – the Trans-Pacific Free Trade Agreement – and so far it looks like it will replicate many of the anti-consumer rules present in the WTO terms and the North American Free Trade Agreement,” said Wallach last week. “These WTO rulings show the need for President Obama to start fulfilling his campaign pledges to create a trade policy Americans can believe in and stop expanding the old trade pact model.”

Canada, which is now considering entering the TPP talks with Japan, should do the same. A COOL victory for two industry groups in Canada is a net loss for the public interest overall.