07/24/2015 08:24 EDT | Updated 07/24/2016 05:59 EDT

U.S. Senate Bill On Country-Of-Origin Labels Not Good Enough, Canada Says

Chip Somodevilla via Getty Images
WASHINGTON, DC - JULY 21: Senate Majority Leader Mitch McConnell (R-KY) (C) talks with reporters after the weekly Senate Republican policy luncheon with Sen. John Barrasso (R-WY) (L) and Sen. John Cornyn (R-TX) at the U.S. Capitol July 21, 2015 in Washington, DC. McConnell announced that he had reached a deal with Senate Environment and Public Works Committee ranking member Sen. Barabara Boxer (D-CA) on a long-term highway funding bill, but Senate Democrats said they will not support the bill without more time to read it or propose amendments. (Photo by Chip Somodevilla/Getty Images)

WASHINGTON — The Canadian government isn't satisfied by the latest step taken by U.S. lawmakers to avoid a continental trade war.

The government said a bill introduced today in the U.S. Senate falls short of what would be required to avoid tariffs on American products.

Canada and Mexico are poised to impose such tariffs following a string of victories at the World Trade Organization, with Canada specifically seeking WTO permission to impose duties of $3 billion on a range of American products including wine and frozen orange juice.

The dispute revolves around rules that require meat sold in the U.S. to be labelled by country of origin, which the WTO has declared invalid.

The subsequent threat of retaliation prompted one chamber of U.S. Congress, the House, to pass a bill repealing the labelling rule.

A bill introduced today in the Senate doesn't go quite that far; it proposes a voluntary system where producers could label meat by where it was born, raised and slaughtered.

The Canadian government says that's still discriminatory, and wouldn't deter it from seeking to impose tariffs.

The bill will now be debated in the Senate, where it could undergo some amendments.

Meanwhile, the tariff request is still before the WTO and Canada says the penalties could be imposed within months.

The meat-labelling dispute pitted proponents of labelling, who said consumers deserve to know where their meat comes from, against opponents including big players in the livestock industry who railed against it as a protectionist measure did nothing to enhance food inspection while simply making it more difficult to import and sort imported meats.

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