Mexico and Canada can impose $1bn in tariffs on US for meat labels, WTO rules

The World Trade Organization ruled on Monday that Canada and Mexico can slap more than $1bn in tariffs on US goods in retaliation for meat labeling rules it says discriminated against Mexican and Canadian livestock.

At issue were US labels on packaged steaks and other cuts of meat that say where the animals were born, raised and slaughtered.

The WTO has previously found that the so-called “country of origin” labeling law put Canadian and Mexican livestock at a disadvantage. It ruled on Monday that Canada could impose $780m in retaliatory tariffs and Mexico could impose $228m.

“We are disappointed with this decision and its potential impact on trade among vital North American partners,” said Tim Reif, general counsel for the Office of the US Trade Representative.

The labels are supported by some US ranchers and by consumer groups. They are opposed by meatpackers who say they require costly paperwork.

The WTO’s decision shifts responsibility to Congress, which is considering working a repeal of the labeling law into a massive year-end spending bill.

Senate agriculture chairman Pat Roberts, said Monday that he will look for “all legislative opportunities” to repeal the labeling law. “We must prevent retaliation, and we must do it now before these sanctions take effect,” Roberts said.

The labeling law was included in the 2002 and 2008 farm bills at the behest of ranchers from those northern US states who compete with the Canadian cattle industry. It has also been backed by consumer advocates who say it helps shoppers know where their food comes from.