Country of Origin Labeling
Country Of Origin Labeling (COOL) (or mCOOL [m for mandatory]) is a requirement signed into American law under Title X of the Farm Security and Rural Investment Act of 2002 (known as the 2002 Farm Bill). This law requires retailers to provide country-of-origin labeling for fresh beef, pork, and lamb. The program exempts processed meats. The United States Congress passed an expansion of the COOL requirements on 29 September 2008, to include more food items such as fresh fruits, nuts and vegetables.
"Under §304 of the Tariff Act of 1930 as amended (19 U.S.C. § 1304), every imported item must be conspicuously and indelibly marked in English to indicate to the “ultimate purchaser” its country of origin." According to the U.S. Customs, generally defined the “ultimate purchaser” is the last U.S. person who will receive the goods in the form in which it was imported.
However, if the goods are destined for a U.S. based processor where they will undergo “substantial transformation”, then that processor or manufacturer is considered the ultimate purchaser. The law authorizes exceptions to labeling requirements, such as for articles incapable of being marked or where the cost would be “economically prohibitive.”
Exceptions to this are codified into law and known as the “J List”, so named for §1304(a)(3)(J) of the statute, which empowered the Secretary of the Treasury to exempt classes of items that were “imported in substantial quantities during the five-year period immediately preceding January 1, 1937, and were not required during such period to be marked to indicate their origin.”
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The contrasting intents of these bills reflected the continuing divergence of opinion among lawmakers over whether a federally mandated labeling program is needed. Some contend that mandatory COOL will provide U.S. products with a competitive advantage over foreign products because U.S. consumers, if offered a clear choice, prefer fresh foods of domestic origin, thereby strengthening demand and prices for them. Moreover, proponents argue that U.S. consumers have a right to know the origin of their food, particularly at a time when U.S. food imports are increasing, and whenever particular health and safety problems arise. They cite as one prominent example concerns about the safety of some foreign beef arising from the discoveries of bovine spongiform encephalopathy (BSE, or mad cow disease) in a number of Canadian-born cows (and two U.S. cows) since 2003. Supporters of the COOL law argue that it is unfair to exempt meats and produce from the longstanding country labeling already required of almost all other imported consumer products, from automobiles to most other foods. They also note that many foreign countries already impose their own country-of-origin labeling.
Opponents of mandatory COOL counter that studies do not provide evidence that consumers want such labeling. They believe COOL is a thinly disguised trade barrier intended to increase importers’ costs and to foster the unfounded perception that imports may be inherently less safe (or of lower quality) than U.S. products. Food safety problems can as likely originate in domestic supplies as in imports, as evidenced by the more than 30 recalls of U.S. meat and poultry products announced by USDA in 2006 alone, these opponents point out. Opponents argue that all food imports already must meet equivalent U.S. safety standards, which are enforced by U.S. officials at the border and overseas; scientific principles, not geography, must be the arbiter of safety. Industry implementation and record-keeping costs, estimated by USDA to be as high as $3.9 billion in the first year and $458 million per year after that, would far outweigh any economic benefits, critics add. (COOL proponents assert that these cost estimates were grossly exaggerated while some in industry claim they were too low).
Canadian challenge at the World Trade Organization
In 2009, the Canadian government launched a challenge to mCOOL at the World Trade Organization (WTO). The Canadian federal government argued before the WTO that American "country of origin" labelling rules (COOL) actually worked to the detriment of the meat industry on both sides of the border by increasing costs, lowering processing efficiency and otherwise distorting trade across the Canada-U.S. border. The WTO ruled in Canada's favor in 2011.
Companies are seeking to communicate the COO and to increase their customer's COO awareness with a number of different strategies:
Legally regulated COO strategies:
- Use of the phrase "Made in..."
- Use of quality and origin labels
Unregulated COO strategies:
- COO embedded in the company name
- Typical COO words embedded in the company name
- Use of the COO language
- Use of famous or stereotypical people from the COO
- Use of COO flags and symbols
- Use of typical landscapes or famous buildings from the COO
- "Associated Press". CNN News. Retrieved 2008-09-30.[dead link]
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- "WTO to Hear Canada’s Challenge to U.S. Mandatory Country-of-Origin Labelling". Foreign Affairs and International Trade Canada. November 19, 2009. Retrieved 2013-05-26.
- "Canada Wins World Trade Organization Case on U.S. Country-of-Origin Labelling". Foreign Affairs and International Trade Canada. November 18, 2011. Retrieved 2013-05-26.
- Aichner, T. 2014. Country-of-origin marketing: A list of typical strategies with examples. Journal of Brand Management, 21(1): 81-93.
- "Country-of-Origin Labeling for Foods" by Geoffrey S. Becker, Specialist in Agricultural Policy Resources, Science, and Industry Division. CRS Document 97-508 - April 26, 2007
- "Country-of-Origin Labeling for Foods and the WTO Trade Dispute on Meat Labeling" by Remy Jurenas, Specialist in Agricultural Policy, and Joel L. Greene, Analyst in Agricultural Policy. CRS Document RS22955 - September 16, 2013
- "Country-of-Origin Labeling: Theory and Observation" By Barry Krissoff, Fred Kuchler, Kenneth Nelson, Janet Perry, and Agapi Somwaru. Outlook Report No. (WRS04-02) 18 pp, January 2004 USDA
- "COUNTRY-OF-ORIGIN-LABELING: Opportunities for USDA and Industry to Implement Challenging Aspects of the New Law" GAO Report GAO-03-780. United States General Accounting Office. August 2003