How Not to Settle Trade Disputes

K. William Watson Last year, the United States lost three cases at the WTO in which domestic regulations were challenged by our trading partners as disguised protectionism.  In each of the three cases—a ban on clove cigarettes, dolphin-safe labels for tuna, and country-of-origin labels for meat—the WTO found that the challenged regulation impacted the competitiveness of foreign goods significantly more than domestic like products and that this discrimination did not further the goals of the regulation.  The United States must amend each of these regulations in the next few months or the complaining governments will be able to pursue WTO-authorized trade sanctions against us.  The offending regulations don’t have to be repealed to be made WTO-compliant, but the United States must do at least one of three things for each of them: Diminish the negative impact on foreign products, Increase the negative impact on domestic products, or Better validate the different treatment. In  the first attempt at reform, the Administration chose Option 3.  Existing regulations require that meat sold in grocery stores carry country-of-origin labels that differ based on the national origin of the animal before it was slaughtered in the United States.  Last year, the WTO determined that tracking and recording requirements in the law made it more costly for U.S. slaughterhouses to purchase foreign-raised cattle, and that the burden was not proportional to the ...
Source: Cato-at-liberty - Category: Health Medicine and Bioethics Commentators Authors: Source Type: blogs