WASHINGTON – The US Department of Agriculture’s Agricultural Marketing Service’s (AMS) call to finalize a March 12 proposed rule on country-of-origin labeling (COOL) for meat and poultry products is “incomprehensible and recklessly disregards the potential adverse retaliatory trade responses from Canada and Mexico”— particularly since it contains no changes despite a massive outpouring of concern from affected companies and major trading partners, charged the American Meat Institute (AMI). (See “Industry reacts to USDA’s final rule for COOL” for more industry responses.)

Responding to complaints by Mexico and Canada, a World Trade Organization (WTO) panel previously determined the 2009 version of Mandatory COOL violated the United States’ WTO obligations. In March 2013, USDA proposed a new rule the agency claimed would bring the US into compliance, but this proposal was more burdensome than the original 2009 rule, which is now in effect, AMI stated.

During an AMI media teleconference held in Washington early in the afternoon on May 23, Mark Dopp, AMI senior vice president of regulatory affairs and counsel, began by stating, “Today’s posting of the final rule is an extremely disappointing result for several reasons. It is very disappointing that the department decided to move forward with this final rule, not taking into account the lengthy and extensive comments that were filed pointing out the very significant problems to the proposal published back in March.”

Dopp added he believed industry presented a compelling case, particularly with respect to how this will adversely affect certain operations —- in particular, in parts of the US, such as the Pacific Northwest, Texas and other areas.

AMI is very concerned once the rule goes into effect on May 24, presuming the final rule gets published in the Federal Register on that date, the result will be some companies, plants and producers will ultimately be put out of business, Dopp said.

“It’s interesting to note the agency said in the preamble that the incremental economic benefits from labeling of production steps, which is one of the key elements of the final rule, will be comparatively small relative to those discussed in the mid-2009 final rule,” Dopp said. “So, we’re wondering where the benefits are.”

Another aspect of the rule that’s extremely disappointing is it immediately goes into effect upon publication in the Federal Register. “And we presume that will probably take place [May 24], which means the rule is effective [May 24],” Dopp said. “That effective date presents a whole host of problems. It ignores the realities of the marketplace and supply chain. It also ignores the ‘elephant in the room’…there is virtually no way the compliance process before the WTO can be completed by [May 24, 2013] and even recognizing the six- month window or period the agency has identified as the educational effort —that compliance process won’t be completed by then either, especially not if whichever side loses in the compliance process appeals.

“What we have is a rule that goes into effect that everybody, in theory, is supposed to comply with — but this can’t be done as a practical matter,” Dopp iterated. “It also means everybody in the industry who will be affected is going to have to begin making changes [in order to comply].”

According to some trade lawyers, Dopp said, the Mexican and Canadian governments will prevail in the compliance process —- but along the way, changes will have been made in the US. “And three or six months later or whatever the timeframe is, the WTO could come back and say, ’Guess what…this rule doesn’t get it done either.’ We will have done all of this for nothing.”

During the teleconference, Dopp said he recently reviewed the docket again and read every comment filed, both pro and con. Several comments jumped out at him, he added.

“The first comment is: “Let’s see, a calf is born in Canada. Eight months later it leaves its mother and makes it way to Colorado in the US. There in the US, it is fed and cared for by US citizens; it is fed US grain in a facility constructed by US citizens. When the time comes, is it trucked in a US truck [driven by a] US driver to a USDA-certified plant, is processed by US citizens and it even carries the grade of the USDA. Now, however, the [US] government thinks it’s important we understand or know that animal was born in Canada. How does this make any sense?”

The last comment simply read: “Please do not change the labeling requirements. I need my job.”

When MEATPOULTRY.com asked Dopp what plans AMI has to address the new final rule, he answered the association has a significant task ahead of it on several fronts. “One, we need to educate our members to what the rule says and what the impact is in terms of what it takes to comply,” he said. “I don’t think there’s any doubt that we will be investigating, along with other organizations that are opposed to the concept of COOL, in general, whether there are opportunities to fix this in the legislature — and whether we will explore other options.”

To his last point, he added, “I’m not in the position to comment on that at this time because the rule in its current format is about 98 pages long. It takes a little while to digest and understand it. So, I can’t tell you whether we would, for example, pursue legal action right now.”