The World Trade Organization says the United States has filed an appeal of a ruling that found the country's meat-labelling laws discriminate against Canadian beef and pork exports.
The ruling last month found that changes the U.S. made to its country-of-origin policy known as COOL violate trade rules because it treats Canadian and Mexican livestock less favourably than U.S. livestock.
Federal Trade Minister Ed Fast said Friday that Canada is deeply disappointed with the U.S. decision to appeal.
"Canada fully expected the United States to live up to its international trade obligations and comply with the WTO ruling, which reaffirms Canada’s long-standing view that the revised U.S. COOL measure is blatantly protectionist and fails to comply with the WTO’s original ruling against it," Fast said in a release.
Agriculture Minister Gerry Ritz has said Ottawa would consider imposing retaliatory tariffs on some U.S. goods as early as next year if Washington doesn't comply with the rulings.
Along with U.S. beef , those tariffs could be placed on cheese, apples, corn, maple syrup, chocolate, pasta, frozen orange juice, wine and spirits, jewelry and mattresses.
COOL rules require all packaged meat to identify where the animal was born, raised and slaughtered.
Supporters of the law say it better informs U.S. consumers, while opponents argue that segregating animals and tracking them adds costs and violates free-trade agreements.
The federal government estimates the policy costs the Canadian pork and beef industries about $1 billion a year.
Ritz said Canada is confident the U.S. will lose its latest appeal.
"With this delay, the United States is yet again preventing both of our countries from enjoying the benefits of freer and more open trade and is hurting farmers, ranchers and workers in the United States and Canada," Ritz said.
"We are confident that the WTO appellate body in the compliance process will uphold the principal finding of the report: that the amended U.S. COOL measure discriminates against Canadian livestock."
The Canadian Cattlemen’s Association called the U.S. appeal a stall tactic and noted it is Washington's last option before Canada can request permission from the trade organization to retaliate.
Association president Dave Solverson said the October ruling was the third time that the trade group has ruled that the U.S. was not meeting its international trade obligations because of COOL.
"This is a stall tactic by the U.S. for sure, but one that can only end with the U.S. making an appropriate resolution to COOL that is acceptable to Canada and Mexico in order to avoid retaliation,” he said.
Once a decision on the appeal is made, possibly by spring, Canada will be in a position to ask the WTO for authority to retaliate with trade sanctions, Solverson said.