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AMI: Timing of New COOL Rule Is 'Nonsense'

WASHINGTON — The American Meat Institute opposes the U.S. Department of Agriculture’s new country-of-origin labeling rule and the speedy finalization of the rule is “nonsense,” AMI’s general counsel said in a media call today.

USDA’s Agricultural Marketing Service posted the final rule to the Federal Register today, and AMI expects the law to be published tomorrow or Monday at the latest.

“Technically people will be out of compliance if they’re not providing the born, raised and slaughtered information starting tomorrow,” said Mark Dopp, AMI senior vice president of regulatory affairs and general counsel.

“Like I said, the idea that the effective date is tomorrow is, as a practical matter, nonsense,” he added.

The Food Marketing Institute and National Grocers Association issued separate statements opposing the new COOL rule.

"It is unreasonable to have a 98-page rule of this magnitude effective immediately. Furthermore, it is profoundly unfair for the regulatory authorities to impose a rule that will have a significant, financial impact on our members when they know that the rule is unlikely to address the concerns raised by the World Trade Organization dispute settlement panel, making yet another round of costly changes inevitable," said Leslie Sarasin, FMI president and CEO.

"It has long been clear that COOL labeling has been a costly regulation that is not required as a public health and safety measure," said Peter Larkin, NGA president and CEO. "The costs of this new change will far exceed the benefits intended and will result in no meaningful consumer benefits. Congress must take action now and create a legislative fix."

USDA’s AMS released the proposed rule in March 2013. AMI and others commented on the rule to express their opposition.

“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 that was published back in March,” said Dopp.

He added that AMI believes some companies and processers will go out of business if forced to comply with the new labeling requirements.

The new rule was issued as a result of a June 2012 World Trade Organization ruling that the original COOL program discriminated against Canada and Mexico.

While May 23 was the deadline for the U.S. to comply with the WTO ruling, WTO still needs to decide if the new COOL requirements are actually in compliance with its ruling.

Dopp said that process is likely to take much longer than even the six months the USDA has allowed for educating retailers, processers and packers after the rule is published.

“Again, it’s disappointing that they’re [USDA] expecting companies to jump through all of these hoops, make all these changes, invest all of these funds, only to look at the very real possibility that the WTO will come back and say, ‘This is not acceptable,’” said Dopp.

He said AMI will work to educate its members on the new rule and will likely pursue other options for striking down the rule, but he couldn’t say right now what those options might entail.

AMI does expect retailers to start complying with the rule at some point within the next six months. As a result of the new labeling requirements, many retailers may stop carrying Category B meat and only carry Category A, Dopp said. As defined by COOL, Category A meat comes from animals that were born, raised and slaughtered in the U.S. while Category B comes from animals that were born and raised in more than one country but slaughtered in the U.S.

He pointed out that even USDA’s AMS said the benefits to the original COOL rule and the updated regulation would be small.

“In other words, in 2009 AMS concluded that the economic benefits of COOL would be small. And today, they’re telling us that the benefits of this rule will be relatively small compared to the very small benefits from 2009. So we’re wondering where the benefits are,” said Dopp.

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