Industry News

U.S. Court Upholds US Country of Origin Labelling for Meat; WTO Showdown Looms
July 30, 2014

    On July 29, 2014 in the case of American Meat Institute v the United States Department of Agriculture, the Federal Court of Appeals for the D.C. Circuit Court ruled that meat sellers can be required by USDA to label their products’ with the country of origin, including the place of birth, raising, and slaughter.  This 9-2 decision raises concern for the meat industry because of the high cost of documenting and displaying all the required information, which will likely increase consumer prices for imported meat as opposed to that produced entirely from domestic animals.
    The Plaintiffs attempted to assert their First Amendment free speech rights, asserting that the Government could only require commercial information to be revealed in order to prevent deception.  However, Judge Williams wrote in his opinion that the underlying precedent “reach[es] beyond the problem of deception” and that other government interests can be invoked to sustain a disclosure mandate – in this case, promotion of domestic product over imports.

    Under the USDA regulations, the affected companies must reveal “where their livestock was born, raised and slaughtered,” which poses significant challenges for border trade in which cattle are routinely moved back and forth between the US, Canada, and Mexico.  In addition, the reseller must designate where all meat comes from and cannot combine meat that was “processed on a single day as coming from the same origin,” a significant burden to ground beef processors who routinely combine beef from different sources.

    The World Trade Organization previously ruled that a predecessor regulation imposed illegal burdens to trade upon Canada and Mexico.  Canada is awaiting approval from the WTO to impose compensatory tariffs against US products in retaliation for the regulation just approved by the DC Court.  The Court, however, addressed only the US Constitutional ramifications of the labelling rule.

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