990272 EU favors compensation over US meat label proposal

Washington - A U.S. proposal to label hormone-treated meat as a product of the United States in order to gain access to the European Union market is still alive, but facing resistance, a top USDA official said.

“They have not rejected it,” Tim Galvin, administrator of the Foreign Agricultural Service, told reporters during a break in the department's annual outlook conference. “They said they would prefer to talk about compensation.”

The U.S. offered the labeling proposal last week in an effort to resolve a longstanding dispute with the EU over imports of hormone-treated beef. The EU has banned imports of such products since 1989 even though the use of artificial growth hormones to make cattle grow bigger and faster has been approved by U.S. regulators.

After losing two World Trade Organization panel decisions, the EU faces a May 13 deadline on the issue. The U.S. has insisted that means the EU must open its market by then. The EU has said it is only obliged to conduct a new risk assessment on the safety of hormone-treated beef.

Galvin told reporters that U.S. officials hope to meet with their EU counterparts “as soon as they're available” to discuss where things stand in the aftermath of U.S. labeling proposal. But as yet, no date for the meeting is set.

Meanwhile, if there is no sign of progress, the United States will begin the process of preparing a list of EU products that would be subject to U.S. retaliation in the dispute, Galvin said.

The National Cattlemen's Beef Association has demanded that such retaliation be set to go into effect on May 14 if the EU has not opened its market by then.

“That's the deadline we're all operating under,” Galvin said, when asked if the Clinton administration planned to have punitive duties take effect that day.

The U.S. government and cattle industry have repeatedly said they want market access, rather than compensation which is one option available to the EU under the WTO.

Compensation could take many forms, including increased access to the EU market for other U.S. goods, Galvin said.

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