Country-of-origin labels will remain the same while the U.S. government continues to review the WTO ruling. (Tim Carman/The Washington Post)

The ruling, says Lori Wallach, director of Public Citizen’s Global Trade Watch, will essentially make it impossible for the United States to continue an effective, mandatory COOL label that “complies with all the constraints the WTO has set.”

“What agribusiness, Mexico and Canada could not get in Congress or through U.S. courts, the WTO delivered: Either we’re supposed to gut our consumer protection or pay millions for the right not to be fed mystery meat,” Wallach e-mailed All We Can Eat this afternoon.

Canada initiated the dispute before the WTO in December 2008, arguing that the COOL program discriminates against imported cattle and hogs and violates some WTO obligations; Mexico later joined the complaint. Last year, a WTO panel ruled broadly against the COOL; the Office of the U.S. Trade Representative, which handles dispute cases before the WTO, appealed the ruling, which led to today’s appellate tribunal decision:

[T]he Appellate Body agreed with the Panel that the COOL measure has a detrimental impact on imported livestock because its recordkeeping and verification requirements create an incentive for processors to use exclusively domestic livestock, and a disincentive against using like imported livestock. The Appellate Body found, however, that the Panel’s analysis was incomplete because the Panel did not go on to consider whether this de facto detrimental impact stems exclusively from a legitimate regulatory distinction, in which case it would not violate Article 2.1. In its own analysis, the Appellate Body found that the COOL measure lacks even-handedness because its recordkeeping and verification requirements impose a disproportionate burden on upstream producers and processors of livestock as compared to the information conveyed to consumers through the mandatory labelling requirements for meat sold at the retail level. That is, although a large amount of information must be tracked and transmitted by upstream producers for purposes of providing consumers with information on origin, only a small amount of this information is actually communicated to consumers in an understandable or accurate manner, including because a considerable proportion of meat sold in the United States is not subject to the COOL measure’s labelling requirements at all.

In a prepared statement, the United States Trade Representative Ron Kirk put a happy face on the WTO ruling, “which affirmed the United States’ right to adopt labeling requirements that provide information to American consumers about the meat they buy.”

“The Obama Administration remains committed to ensuring that information on the origin of all food products covered by COOL is available to American families so they can make informed purchasing decisions,” Kirk continued in his statement.

But the statement also acknowledged that the appellate body found problems with COOL that “provides less favorable treatment to Canadian and Mexican cattle and hogs than American livestock.”

The current COOL statute and regulations will remain in effect while the Office of the U.S. Trade Representative continues to review the appellate body’s ruling. The office notes that it’s too early to know what actions will be necessary to bring COOL into WTO compliance.

At least one group was angry with the WTO ruling today — but not because it might lead to a watered-down labeling program that leaves consumers in the dark about their meat. The National Cattlemen’s Beef Association was upset because the government had wasted taxpayer dollars to defend a program that is a “clear WTO violation.”

The NCBA has been against the COOL program since it was approved as part of the 2008 Farm Bill. The group’s frustration could be clearly felt in its statement today:

“Instead of working diligently to bring the United States into WTO compliance, we wasted three months and taxpayer dollars on an appeal process. This did nothing more than jeopardize our strong trade relationship with Canada and Mexico, the two largest importers of U.S. beef. The Obama Administration prolonged an issue that could have been resolved quickly.”