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OTTAWA (Reuters) - Canada will request World Trade Organization consultations on South Korea's ban on Canadian beef imports, a formal step which could lead to stronger action, Trade Minister Stockwell Day said Thursday.
South Korea banned Canadian beef in May 2003 after bovine spongiform encephalopathy (BSE) was found in a Canadian cow, but Day said it was unjustified to continue this since Canada was categorized in 2007 as a "controlled BSE risk."
If consultations fail to resolve the matter, Canada may request that the matter be referred to a dispute settlement panel.
"We are disappointed to have to launch this action, as we had hoped to resolve our differences through negotiation," Day said in a statement.
"Canada has a robust trade relationship with South Korea, so it is unfortunate that we have not been able to settle this issue and reopen South Korean markets to Canadian beef."
The categorization as a controlled BSE risk was made by the World Organization for Animal Health, which goes by the acronym OIE.
"The United States, which has the same OIE controlled-risk status as Canada, obtained access to the South Korean beef market in June 2008," a statement from Day's office said.
Last September, Canada intensified bilateral relations to try to avoid taking action at the WTO, and on March 20 Agriculture Minister Gerry Ritz visited South Korea, but to no avail.
Consultations must generally be held within 30 days of a request being filed, and if they do not resolve the dispute, Canada would be in a position to request the establishment of a dispute panel 60 days from now.
In 2002, South Korea was Canada's fourth-largest beef export market at C$50 million ($41 million).
Reporting by Randall Palmer; Editing by Jeffrey Hodgson