TSN Tyson Foods

The World Trade Organization on Monday said Canada and Mexico can impose $1.01 billion in retaliatory tariffs on U.S. goods for meat-labeling rules that the WTO ruled discriminate against livestock from the U.S. trading partners.

The decision caps a yearslong battle over country-of-origin labeling rules, known as COOL, in which the U.S. required packages of beef, pork and other meat products to disclose where animals were born, raised and slaughtered. The rule became law in 2009.

Canada can slap $780.8 million in tariffs on U.S. goods and Mexico can apply $227.8 million, the WTO ruled on Monday. The organization in May upheld its earlier ruling that the U.S. rules discriminated against Canadian and Mexican livestock, imposing "a disproportionate burden on producers and processors of livestock that cannot be explained by the need to provide origin information to consumers."

Consumer groups have long argued that country-of-origin labels can help shoppers avoid food from countries with lax safety regulations, and the rules drew support from some U.S. ranching groups. But meatpackers said the regulations imposed unnecessary burdens and costs.

National Cattlemen's Beef Association, a group that represents both cattle producers and processors like JBS SA and Tyson Foods Inc., said the WTO's conclusion should encourage Congress to repeal the labeling law. The U.S. House has passed legislation to repeal the law.

"America's cattlemen and women produce the best beef in the world, but we do not support this mandate from the federal government to market our product," said Philip Ellis, president of NCBA.

The trade authority's decision "has undermined U.S. sovereignty and the right of American consumers to know the origin of their food," said Roger Johnson, president of National Farmers Union, a Washington-based organization that represents farmers and ranchers.

Write to Kelsey Gee at kelsey.gee@wsj.com

(END) Dow Jones Newswires

December 07, 2015 12:35 ET (17:35 GMT)

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