# Foreign Supplier Verification Programs for Importers of Food for Humans and Animals

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URL: https://www.frixlaw.com/law-library/documents/fr%3A2015-28158

## Record

- **Collection:** Federal Register
- **Document type:** Rule
- **Published:** November 27, 2015
- **Citation:** 80 FR 74226

## Text

DEPARTMENT OF HEALTH AND HUMAN SERVICES
Food and Drug Administration
21 CFR Parts 1, 11, and 111
[Docket No. FDA-2011-N-0143]
RIN 0910-AG64
Foreign Supplier Verification Programs for Importers of Food for Humans and Animals

AGENCY:

Food and Drug Administration, HHS.

ACTION:

Final rule.

SUMMARY:

The Food and Drug Administration (FDA) is adopting a regulation on foreign supplier verification programs (FSVPs) for importers of food for humans and animals. The regulation requires importers to verify that food they import into the United States is produced in compliance with the hazard analysis and risk-based preventive controls and standards for produce safety provisions of the Federal Food, Drug, and Cosmetic Act (the FD&C Act), is not adulterated, and is not misbranded with respect to food allergen labeling. We are issuing this regulation in accordance with the FDA Food Safety Modernization Act (FSMA). The regulation will help ensure the safety of imported food.

DATES:

This rule is effective January 26, 2016. For the applicable compliance dates, see “Effective and Compliance Dates” in the
Supplementary Information
section of this document.

ADDRESSES:

For access to the docket to read background documents or comments received, go to
http://www.regulations.gov
and insert the docket number found in brackets in the heading of this final rule into the “Search” box and follow the prompts, and/or go to the Division of Dockets Management, 5630 Fishers Lane, Rm. 1061, Rockville, MD 20852.

FOR FURTHER INFORMATION CONTACT:

Brian Pendleton, Office of Policy, Food and Drug Administration, 10903 New Hampshire Ave., Silver Spring, MD 20993-0002, 301-796-4614; or Domenic Veneziano, Office of Enforcement and Import Operations (ELEM-3108), Office of Regulatory Affairs, Food and Drug Administration, 12420 Parklawn Dr., Element Bldg., Rockville, MD 20857, 301-796-6673.

SUPPLEMENTARY INFORMATION:

Table of Contents

Executive Summary

Purpose and Coverage of the Rule

Summary of the Major Provisions of the Final Rule

Modified Provisions for Certain Types of Importers

Costs and Benefits

I. Background

A. FDA Food Safety Modernization Act

B. Stages in the FSVP Rulemaking

C. Summary of the Major Provisions of the Proposed Rule

D. Public Comments

II. Legal Authority

III. Comments on the Proposed Rule and Supplemental Notice of Proposed Rulemaking

A. Definitions (§ 1.500)

B. Applicability and Exemptions (§ 1.501)

C. Purpose and Scope of FSVPs (§ 1.502)

D. Personnel Developing and Performing FSVP Activities (§ 1.503)

E. Hazard Analysis (§ 1.504)

F. Evaluation for Foreign Supplier Approval and Verification (§ 1.505)

G. Foreign Supplier Verification Activities (§ 1.506)

H. Foods That Cannot Be Consumed Without Control of Hazards and Foods Whose Hazards Are Controlled After Importation (§ 1.507)

I. Corrective Actions and Investigations Into FSVP Adequacy (§ 1.508)

J. Identification of Importer at Entry (§ 1.509)

K. Records (§ 1.510)

L. Dietary Supplements and Dietary Supplement Components (§ 1.511)

M. Very Small Importers and Importers of Food From Certain Small Foreign Suppliers (§ 1.512)

N. Importing a Food From a Foreign Supplier in a Country With an Officially Recognized or Equivalent Food Safety System (§ 1.513)

O. Consequences of Failure To Comply With FSVP Requirements (§ 1.514)

P. Other Issues

IV. Effective and Compliance Dates

A. Effective Date

B. Compliance Dates

V. Executive Order 13175

VI. Economic Analysis of Impacts

VII. Analysis of Environmental Impact

VIII. Paperwork Reduction Act of 1995

IX. Federalism

X. References

Executive Summary

Purpose and Coverage of the Rule

This rule is part of FDA's implementation of the FDA Food Safety Modernization Act (FSMA), which intends to better protect public health by, among other things, adopting a modern, preventive, and risk-based approach to food safety regulation. This rule adopts provisions concerning FSVPs that importers must create and follow to help ensure the safety of imported food. The regulation is designed to be flexible based on risk, and the requirements vary based on the type of food product (such as processed foods, produce, and dietary supplements) and category of importer.

Congress required importers to perform risk-based foreign supplier verification activities and directed FDA to promulgate regulations on the content of FSVPs in section 301 of FSMA, codified in section 805 of the FD&C Act. The rule requires importers to implement FSVPs to provide adequate assurances that the importer's foreign suppliers produce food in compliance with processes and procedures, including risk-based preventive controls, that provide the same level of public health protection as those required under section 418 (concerning hazard analysis and preventive controls) or 419 (concerning produce safety) of the FD&C Act, as appropriate, and in compliance with sections 402 (concerning adulteration) and 403(w) (concerning misbranding regarding allergen labeling) of the FD&C Act.

This rule is the result of significant stakeholder engagement. We took this approach to help ensure that the rule achieves its public health goal, reflects industry practice, and strikes the right balance between flexibility and accountability.

Summary of the Major Provisions of the Final Rule

We are finalizing a flexible, risk-based approach to foreign supplier verification. The FSVP regulation focuses on known or reasonably foreseeable food safety hazards, identified and considered through a hazard analysis and evaluation process, rather than all adulteration covered by the adulteration provisions in section 402 of the FD&C Act. After considering the comments on the proposed rule and the subsequently revised proposal along with other stakeholder input, we continue to believe that hazard analysis, which is well accepted and understood throughout the international food safety community, provides the most effective way to implement a risk-based framework in which importers can evaluate potential products and suppliers and ensure that appropriate verification activities occur.

The FSVP regulation aligns with key components of the food safety plans that facilities that manufacture, process, pack, or hold must establish and follow under FDA's recently issued regulations on current good manufacturing practice (CGMP) and hazard analysis and risk-based preventive controls for human food and animal food (preventive controls regulations). In particular, the FSVP final rule is consistent with the supply-chain program provisions of those regulations to the extent feasible and appropriate. The general FSVP framework, together with the modified

requirements applicable to certain importers and foods, are intended to be sufficiently general and flexible to apply to a variety of circumstances without being unduly burdensome or restrictive of trade.

Although FSVP requirements apply to most imported food under FDA's regulatory jurisdiction, certain categories of imported food are not covered under the FSVP regulation. These exemptions include certain juice, fish, and fishery products (which are already subject to verification under FDA's hazard analysis and critical control point (HACCP) regulations for those products), food for research or evaluation, food for personal consumption, alcoholic beverages, food that is transshipped, food imported for processing and future export, food exported from and returned to the United States without manufacturing/processing in a foreign country, and certain meat, poultry, and egg products regulated by the U.S. Department of Agriculture (USDA).

In the final rule, we have added new provisions to allow greater flexibility with respect to certain requirements to better reflect modern food supply and distribution chains. Under the FSVP regulation, importers are responsible for:

1. Determining the hazards reasonably likely to cause illness or injury with each food. Importers can conduct their own analysis of the potential hazards with a food or review and assess a hazard analysis conducted by another entity.

2. Evaluating the risk posed by a food, using the results of the hazard analysis, and evaluating the foreign supplier's performance. This evaluation informs the approval of foreign suppliers and the determination of appropriate supplier verification activities. An importer may rely on another entity to conduct this evaluation and to determine the appropriate supplier verification activities as long as the importer reviews and assesses the evaluation, determination, or both, as applicable. An importer must approve its own foreign suppliers.

3. Conducting supplier verification activities. In general, importers must establish and follow written procedures to ensure they only import foods from foreign suppliers they have approved. However, importers may import food from unapproved foreign suppliers, on a temporary basis when necessary and appropriate, if they subject the food from these suppliers to adequate verification activities before importing it.

Importers are responsible for determining and documenting foreign supplier verification activities (as well as the frequency with which those activities must be conducted) that are appropriate to provide assurance that hazards requiring a control in food are significantly minimized or prevented. Importers must conduct supplier verification activities for each foreign supplier before importing a food into the United States and periodically thereafter. An importer may determine, document, and conduct these activities itself or may rely on other entities to perform those tasks, as long as the importer reviews and assesses the relevant documentation, including the results of supplier verification activities.

The appropriate verification activities and their frequency will vary depending on the food, the foreign supplier, and the nature of the control. Appropriate verification activities include: onsite auditing, sampling and testing of a food, review of the foreign supplier's relevant food safety records, and other activities that are appropriate based on the evaluation of the risk posed by the food and foreign supplier performance.

When a hazard in a food will be controlled by the foreign supplier and is one for which there is a reasonable probability that exposure to the hazard will result in serious adverse health consequences or death to humans or animals, the default appropriate verification activity under the regulation is an annual onsite audit of the foreign supplier. To provide flexibility even in these circumstances, the rule allows for the performance of a different supplier verification activity and/or less frequent onsite auditing provided an adequate written determination is made that the other approach will meet the public health purpose of supplier verification.

4. Performing appropriate activities in other circumstances. The final rule also adds flexibility and recognizes the reality of modern distribution chains by not requiring an importer to conduct supplier verification (or evaluate the risk posed by a food and the foreign supplier's performance) when the hazard requiring a control in a food will be controlled by a subsequent entity in the distribution chain in the United States. For example, if an importer's customer will control the hazard, the importer can rely on its customer to provide written assurance that the food will be processed for food safety and must disclose that the food has not been processed to control the identified hazard. If the hazard will be controlled by a subsequent entity in the distribution chain, the final rule requires disclosure that the food has not been processed to control the identified hazard as well as a series of written assurances starting with assurances from the customer to the importer and continuing the obligation to provide written assurance of processing for food safety throughout the distribution chain. We also have provided flexibility for an importer to establish, document, and implement an alternative system that ensures adequate control, at a later distribution step, of the hazards in a food product distributed by a manufacturing/processing facility.

5. Conducting corrective actions. An importer must take appropriate corrective actions promptly if it determines that a foreign supplier of a food it imports does not produce the food in compliance with the processes and procedures that provide the same level of public health protection as those required under section 418 or 419 of the FD&C Act, if either is applicable, or produces food that is adulterated under section 402 or misbranded under section 403(w) (if applicable) of the FD&C Act. This determination could be based on a review of consumer, customer, or other complaints related to food safety, verification activities, or other information. The appropriate corrective actions will depend on the circumstances but could include discontinuing use of the foreign supplier until the problem is resolved.

6. Identifying themselves as the importer of the food for each line of food product offered for importation into the United States.

7. Retaining records of FSVP activities.

Modified Provisions for Certain Types of Importers

The rule provides several exceptions to the standard FSVP requirements for certain types of importers. First, for dietary supplements and dietary supplement components, importers who establish and verify compliance with certain specifications (concerning dietary supplement components and packaging) under the dietary supplement CGMP regulations will not be required to comply with most of the standard FSVP requirements, including hazard analysis and standard supplier verification activities. The same exception would apply to importers whose customer is required to establish such specifications and verify that they are met, except that the importer would have to obtain written assurance that its customer is complying with those requirements. In contrast, importers of other dietary supplements would be required to comply with most of the standard FSVP requirements but would

not have to conduct hazard analyses, and their supplier verification activities would focus on verifying that the supplier is in compliance with the dietary supplement CGMP regulation, rather than verifying that hazards requiring a control are significantly minimized or prevented, as required under the standard supplier verification activity provisions.

Second, the rule establishes modified FSVP requirements for very small importers and importers of food from certain small foreign suppliers. We have aligned the definition of “very small importer” with the definitions of “very small business” under the regulations on preventive controls for human food and animal food. With respect to the importation of human food, the definition of very small importer has an annual sales ceiling of $1,000,000, which is consistent with the $1,000,000 annual sales ceiling for a very small business under the preventive controls for human food regulation. With respect to the importation of animal food, the definition of very small importer has an annual sales ceiling of $2,500,000, which is consistent with the $2,500,000 annual sales ceiling for a very small business under the preventive controls for animal food regulation.

In addition, food from three types of small foreign suppliers is not subject to standard supplier verification requirements. Those foreign suppliers are: (1) Qualified facilities under either of the preventive controls regulations, (2) farms that are not “covered farms” under the produce safety regulation in part 112 (21 CFR part 112) in accordance with § 112.4(a), or in accordance with §§ 112.4(b) and 112.5, and (3) shell egg producers not subject to part 118 (21 CFR part 118) because the shell egg producer has fewer than 3,000 laying hens. Each of these types of producers is either exempt from their underlying FDA food safety regulations or subject to modified requirements, mostly, and in some cases entirely, because of the size of these producers.

The relatively small volume of food imported by and from these entities should reduce consumers' exposure to, and potential risk from, this imported food. Therefore, we are proposing that in these situations the importer would not be required to conduct a hazard analysis and would be able to verify their foreign suppliers by obtaining written assurance of their supplier's compliance with the applicable food safety regulations (or, in some cases, the supplier's acknowledgement that it is subject to the adulteration provisions of the FD&C Act). This policy is similarly reflected in the supply-chain program provisions of the preventive controls regulations.

Third, the rule excludes from most of the standard FSVP requirements (including hazard analysis and verification that identified hazards are significantly minimized or prevented) certain types of food from a foreign supplier in a country whose food safety system FDA has officially recognized as comparable or determined to be equivalent to that of the United States, provided that:

• The food is within the scope of the relevant official recognition or equivalency determination;

• The importer determines that the foreign supplier of the food is in good compliance standing with the relevant food safety authority; and

• The food is not intended for further processing in the United States,
e.g.,
packaged food products and raw agricultural commodities (RACs) that will not be processed further before consumption.

These provisions are consistent with our risk-based approach to foreign supplier verification because they enable both importers and FDA to leverage the regulatory efforts of food safety authorities in countries the Agency has officially determined to have food safety systems that are comparable or equivalent to that of the United States.

Costs and Benefits

This final rule requires importers of human and animal food to establish foreign supplier verification programs. It includes requirements regarding use of qualified individuals, evaluation of hazards in food and foreign supplier performance, verification of suppliers (through activities such as onsite audits, testing, and records review), and importer identification at entry. The total annualized costs of the final rule are estimated to be approximately $435 million per year under 3 percent and 7 percent discount rates over 10 years. In the proposed rule's Preliminary Regulatory Impact Analysis (PRIA), we calculated costs under three different scenarios reflecting different percentages of importers who, under proposed Option 2 for supplier verification requirements, might choose to conduct onsite audits of their foreign suppliers rather than perform different permitted verification activities. We present the Scenario 1 estimate (under which 63 percent of the importers we estimated would need to conduct mandatory onsite audits of their foreign suppliers under proposed Option 1 would conduct onsite audits under the final rule) as the overall estimate to facilitate comparison with the summary tables in the PRIA and the Supplemental PRIA; however, the summary table provides totals costs under all three scenarios.

Total Annual Cost Summary for All Elements of Final Rule
[Rounded to nearest million]

Total

Year 1

Hiring Qualified Individuals:

Scenario 1
$34

Scenario 2
33

Scenario 3
32

Conducting Information Collection and Food and Supplier Evaluations
89

Writing and Maintaining Procedures Relating to Verification Requirements
51

Following Procedures Relating to Verification Requirements Including Establishing, Maintaining, and Following Procedures to Ensure Receipt of Food From Approved Suppliers:

Scenario 1
245

Scenario 2
241

Scenario 3
237

Obtaining Written Assurances From Foreign Suppliers, Customers, and Other Entities in U.S. Distribution
31

Documenting Very Small Importer or Small Supplier Status
6

Conducting Corrective Actions
1

Importer Identification
7

Grand Total Year 1:

Scenario 1
464

Scenario 2
459

Scenario 3
456

Every Year After Year 1

Hiring Qualified Individuals:

Scenario 1
34

Scenario 2
33

Scenario 3
32

Conducting Information Collection and Food and Supplier Evaluations
74

Writing and Maintaining Procedures Relating to Verification Requirements
42

Following Procedures Relating to Verification Requirements Including Establishing, Maintaining, and Following Procedures to Ensure Receipt of Food From Approved Suppliers:

Scenario 1
245

Scenario 2
241

Scenario 3
237

Obtaining Written Assurances From Foreign Suppliers, Customers, and Other Entities in U.S. Distribution
23

Documenting Very Small Importer or Small Supplier Status
6

Conducting Corrective Actions
1

Importer Identification
7

Grand Total Every Year After Year 1:

Scenario 1
431

Scenario 2
426

Scenario 3
422

Although the FSVP regulation does not establish safety requirements for food manufacturing and processing, it benefits the public health by helping to ensure that imported food is produced in a manner consistent with other applicable food safety regulations. The Regulatory Impact Analyses for the final rules on preventive controls for human food and standards for produce safety consider and analyze the number of illnesses and deaths that those regulations are aimed at reducing. The greater the compliance with those regulations, the greater the expected reduction in illnesses and deaths as well as the costs associated with them. The FSVP regulation will be an important mechanism for improving and helping to ensure compliance with the above-noted food safety regulations as they apply to imported food. For this reason, and because we do not have sufficient data to determine the extent to which particular regulations might be responsible for the expected reduction in foodborne illnesses resulting from the FSMA final rules, we account for the public health benefits of the FSVP regulation in the preventive controls, produce safety, and other applicable food safety regulations instead of in this final rule.

I. Background

A. FDA Food Safety Modernization Act

FSMA (Pub. L. 111-353), signed into law by President Obama on January 4, 2011, is intended to allow FDA to better protect public health by helping to ensure the safety and security of the food supply. FSMA enables us to focus more on preventing food safety problems rather than relying primarily on reacting to problems after they occur. The law also provides new enforcement authorities to help achieve higher rates of compliance with risk-based, prevention-oriented safety standards and to better respond to problems when they occur. In addition, the law contains important new tools to better ensure the safety of imported foods and encourages partnerships with State, local, tribal, and territorial authorities. A top priority for FDA are those FSMA-required regulations that provide the framework for industry's implementation of preventive controls and enhance our ability to oversee their implementation for both domestic and imported food. To that end, we proposed the seven foundational rules listed in Table 1 and requested comments on all aspects of these proposed rules.

Table 1—Published Foundational Rules for Implementation of FSMA

Title
Abbreviation
Publication

Current Good Manufacturing Practice and Hazard Analysis and Risk-Based Preventive Controls for Human Food
2013 preventive controls for human food proposed rule
78 FR 3646, January 16, 2013.

Standards for the Growing, Harvesting, Packing, and Holding of Produce for Human Consumption
2013 produce safety proposed rule
78 FR 3504, January 16, 2013.

Current Good Manufacturing Practice and Hazard Analysis and Risk-Based Preventive Controls for Food for Animals
2013 preventive controls for animal food proposed rule
78 FR 64736, October 29, 2013.

Foreign Supplier Verification Programs for Importers of Food for Humans and Animals
2013 FSVP proposed rule
78 FR 45730, July 29, 2013.

Accreditation of Third-Party Auditors/Certification Bodies to Conduct Food Safety Audits and to Issue Certifications
2013 third-party certification proposed rule
78 FR 45782, July 29, 2013.

Focused Mitigation Strategies to Protect Food Against Intentional Adulteration
2013 intentional adulteration proposed rule
78 FR 78014, December 24, 2013.

Sanitary Transportation of Human and Animal Food
2014 sanitary transportation proposed rule
79 FR 7006, February 5, 2014.

We also issued a supplemental notice of proposed rulemaking for the rules listed in Table 2 and requested comments on specific issues identified in each supplemental notice.

Table 2—Published Supplemental Notices of Proposed Rulemaking for the Foundational Rules for Implementation of FSMA

Title
Abbreviation
Publication

Current Good Manufacturing Practice and Hazard Analysis and Risk-Based Preventive Controls for Human Food
2014 preventive controls for human food supplemental notice
79 FR 58524, September 29, 2014.

Standards for the Growing, Harvesting, Packing, and Holding of Produce for Human Consumption
2014 produce safety supplemental notice
79 FR 58434, September 29, 2014.

Current Good Manufacturing Practice and Hazard Analysis and Risk-Based Preventive Controls for Food for Animals
2014 preventive controls for animal food supplemental notice
79 FR 58476, September 29, 2014.

Foreign Supplier Verification Programs for Importers of Food for Humans and Animals
2014 FSVP supplemental notice
79 FR 58574, September 29, 2014.

We finalized two of the foundational rulemakings listed in Table 3 in September 2015.

Table 3—Published Foundational Rules for Implementation of FSMA

Title
Abbreviation
Publication

Current Good Manufacturing Practice and Hazard Analysis and Risk-Based Preventive Controls for Human Food
Preventive controls for human food final rule
80 FR 55908, September 17, 2015.

Current Good Manufacturing Practice and Hazard Analysis and Risk-Based Preventive Controls for Food for Animals
Preventive controls for animal food final rule
80 FR 56170, September 17, 2015.

As we finalize these seven foundational rulemakings, we are putting in place a modern framework for food safety that brings to bear the most current science on the regulation of food safety, is risk-based and focuses efforts on known or reasonably foreseeable hazards, and is flexible and practical given existing food safety practices. To achieve this, we have engaged in extensive outreach to the stakeholder community to find the right balance of flexibility and accountability in this regulation.

Since FSMA was enacted in 2011, we have been involved in approximately 600 engagements on FSMA and the proposed rules, including public meetings, webinars, listening sessions, farm tours, and extensive presentations and meetings with various stakeholder groups (Refs. 1-3). As a result of this stakeholder dialogue, we decided to issue the four supplemental notices of proposed rulemaking to announce several changes to our proposals, share our current thinking on key issues, and get additional stakeholder input on those issues. As we move forward into the next phase of FSMA implementation, we intend to continue this dialogue and collaboration with our stakeholders, through guidance, education, training, and assistance, to ensure that everyone understands and engages in their role in food safety. We believe these seven foundational final rules will effectively implement the paradigm shift toward prevention envisioned in FSMA and be a major step forward for food safety that will help protect consumers into the future.

B. Stages in the FSVP Rulemaking

Section 301 of FSMA added section 805 to the FD&C Act (21 U.S.C. 384a) to require persons who import food into the United States to perform risk-based foreign supplier verification activities. Section 805(c) of the FD&C Act directs FDA to issue regulations on the content of FSVPs.

We published a proposed rule on FSVPs in 2013 (78 FR 45730, July 29, 2013). We published new and revised provisions in a 2014 supplemental notice of proposed rulemaking (Supplemental Notice) (79 FR 58574, September 29, 2014). In the Supplemental Notice, we reopened the comment period on the proposed rule only with respect to specific proposed provisions. In addition, we emphasized that the revised provisions we included in the regulatory text were based on a preliminary review of the comments.

In this document, we use the terms “FSVP proposed regulations” or “proposed rule” to refer to the complete proposed regulatory text, including both the proposed provisions we published in the 2013 proposed rule and the new and revised provisions we published in the 2014 Supplemental Notice. We use the terms “2013 FSVP proposed rule” and “Supplemental Notice” to refer to specific text published in those documents. We use the terms “FSVP regulation,” “final rule,” and “this rule” to refer to the regulation we are establishing as a result of this

rulemaking. We also use the term “preventive controls regulations” to refer to the regulations on preventive controls for human food and preventive controls for animal food collectively.

C. Summary of the Major Provisions of the Proposed Rule

The proposed FSVP regulation, set forth in proposed subpart L of part 1 (21 CFR part 1), would require importers of most imported food to take risk-based steps to verify that the food they import is produced in compliance with applicable FDA regulatory requirements. The proposed regulation was intended to work in tandem with provisions of FSMA and the FD&C Act to create a more seamless system of food safety, applicable to both domestic and imported food, that provides appropriate layers of protection for U.S. consumers. At its core, FSMA establishes a preventive and risk-based approach that assigns to the food industry the primary responsibility for food safety. For example, FSMA requires food facilities that manufacture, process, pack, or hold food to implement risk-based preventive controls (in section 103 of FSMA, codified in section 418 of the FD&C Act (21 U.S.C. 350g)), with certain exceptions. FSMA also requires FDA to establish science-based, minimum standards for farms that grow, harvest, pack, and hold certain produce, also with certain exceptions (in section 105 of FSMA, codified in section 419 of the FD&C Act (21 U.S.C. 350h)). The intent of these requirements is to ensure that all segments of the food industry meet their responsibilities under the FD&C Act to produce safe food.

While FSMA grants FDA additional enforcement tools and directs the Agency to increase its inspections of food facilities, Congress determined that more was needed to adequately control the safety risks posed by imported food. Thus, FSMA creates new obligations for food importers. The FSVP proposed regulation was intended to ensure that importers take responsibility for the safety of the food they import into the United States so no food safety gaps exist between foreign producers and U.S. consumers.

Through this and other FSMA regulations, we are establishing a modern, risk-based food safety system designed to hold those in the food safety supply chain accountable for meeting their responsibilities. In doing so, we recognize the variability within the food industry of the size of operations and the type and volume of foods produced. Therefore, we have written regulations that provide a flexible approach to food safety, taking into account the risk posed by the food and the size of the regulated businesses. While these regulations establish strong, risk-based food safety standards, they allow firms flexibility in determining how they will meet these standards, as appropriate.

In accordance with FSMA, the FSVP regulation we proposed would require food importers to adopt programs to ensure that the food they import: (1) Is produced in a manner that provides the same level of public health protection as required under section 418 or 419 of the FD&C Act, as appropriate; (2) is not adulterated under section 402 of the FD&C Act (21 U.S.C. 342); and (3) is not misbranded under section 403(w) of the FD&C Act (21 U.S.C. 343(w)) (concerning allergen labeling). The proposed rule would require importers to take the following actions as part of their FSVPs:

• Use a qualified individual to perform most FSVP activities;

• Analyze known or reasonably foreseeable hazards in foods they import to determine if the hazards are significant;

• Determine and perform verification activities for foods they import, based on the hazard analysis and an evaluation of supplier risks;

• Establish and follow procedures to ensure they import foods only from foreign suppliers they have approved (except, when necessary and appropriate, from unapproved suppliers on a temporary basis);

• Review complaints, conduct investigations of adulterated or misbranded food, take corrective actions when appropriate, and modify the FSVP when it is determined to be inadequate;

• Reassess the effectiveness of the FSVP;

• Ensure that information identifying the importer is submitted upon entry of a food into the United States; and

• Maintain records of FSVP procedures and activities.

In addition to these “standard” FSVP requirements that would apply to most food importers, the proposed rule included modified requirements for the following:

• Importers of dietary supplements and dietary supplement components;

• Very small importers and importers of food from very small suppliers; and

• Importers of food from foreign suppliers in countries whose food safety systems FDA has officially recognized as comparable or determined to be equivalent to the U.S. food safety system.

D. Public Comments

We received more than 300 public submissions on the 2013 FSVP proposed rule and more than 100 public submissions on the 2014 Supplemental Notice, each containing one or more comments on various aspects of the proposal. We received submissions from diverse members of the public, including the following: Importers; coalitions; trade organizations; consulting firms; law firms; academia; public health organizations; public advocacy groups; consumers; consumer groups; Congress; Federal, State, local, and tribal Government Agencies; foreign governments; and other organizations. The comments address virtually every provision of the FSVP proposed rule. In the remainder of this document, we describe these comments, respond to them, and explain any changes we made to the proposed regulation.

Some comments address issues that are outside the scope of this rulemaking. For example, we received comments asking that we increase the frequency and standardization of our inspection of foreign food facilities, improve our entry review procedures, and revise the Reportable Food Registry. We do not discuss such comments in this document.

II. Legal Authority

On January 4, 2011, FSMA was signed into law. Section 301 of FSMA added section 805 to the FD&C Act to require persons who import food into the United States to perform risk-based foreign supplier verification activities for the purpose of verifying the following: (1) The food is produced in compliance with section 418 (concerning hazard analysis and risk-based preventive controls) or 419 (concerning standards for the safe production and harvesting of certain fruits and vegetables that are RACs) of the FD&C Act, as appropriate; (2) the food is not adulterated under section 402 of the FD&C Act; and (3) the food is not misbranded under section 403(w) of the FD&C Act (concerning food allergen labeling). Section 805(c) of the FD&C Act directs FDA to issue regulations on the content of FSVPs. Section 805(c)(2)(A) states that these regulations must require that the FSVP of each importer is adequate to provide assurances that each of the importer's foreign suppliers produces food in compliance with processes and procedures, including risk-based preventive controls, that provide the same level of public health protection as those required under section 418 or 419 of the FD&C Act, as appropriate, and in

compliance with sections 402 and 403(w) of the FD&C Act. Section 805(c)(2)(B) states that these regulations must include such other requirements as FDA deems necessary and appropriate to verify that food imported into the United States is as safe as food produced and sold within the United States.

Section 805(c)(3) of the FD&C Act directs FDA to, as appropriate, take into account differences among importers and types of imported food, including based on the level of risk posed by the imported food. Section 805(c)(4) states that verification activities under FSVPs may include monitoring records for shipments, lot-by-lot certification of compliance, annual onsite inspections, checking the hazard analysis and risk-based preventive control plans of foreign suppliers, and periodically testing and sampling shipments of imported products. Section 805(d) states that records of an importer related to a foreign supplier verification program must be maintained for a period of not less than 2 years and must be made available promptly to a duly authorized representative of the Secretary of the Department of Health and Human Services (the Secretary) upon request. Section 805(g) directs FDA to publish and maintain a list of importers participating under section 805 on the Agency's Web site.

Section 301(b) of FSMA amends section 301 of the FD&C Act (21 U.S.C. 331) by adding section 301(zz), which designates as a prohibited act the importation or offering for importation of a food if the importer (as defined in section 805 of the FD&C Act) does not have in place an FSVP in compliance with section 805. In addition, section 301(c) of FSMA amends section 801(a) of the FD&C Act (21 U.S.C. 381(a)) by stating that an article of food being imported or offered for import into the United States must be refused admission if it appears from an examination of a sample of such an article or otherwise that the importer is in violation of section 805.

In addition to the authority specified in section 301 of FSMA to issue this regulation, section 701(a) of the FD&C Act (21 U.S.C. 371(a)) gives us the authority to issue regulations for the efficient enforcement of the FD&C Act. Also, some aspects of the FSVP regulation are supported by section 421(b) of the FD&C Act (21 U.S.C. 350j(b)).

In addition to the FD&C Act, FDA's legal authority for some aspects of the regulations derives from the Public Health Service Act (PHS Act) to the extent such measures are related to communicable disease. Authority under the PHS Act is derived from the provisions of sections 311, 361, and 368 (42 U.S.C. 243, 264, and 271) that relate to communicable disease. The PHS Act authorizes the Secretary to make and enforce such regulations as “are necessary to prevent the introduction, transmission, or spread of communicable diseases from foreign countries into the States * * * or from one State * * * into any other State” (section 361(a) of the PHS Act) (see section 1, Reorg. Plan No. 3 of 1966 at 42 U.S.C. 202 for transfer of authority from the Surgeon General to the Secretary).

III. Comments on the Proposed Rule and Supplemental Notice of Proposed Rulemaking

A. Definitions (§ 1.500)

We proposed to codify definitions of several terms that we use in the FSVP regulation. As discussed in the following paragraphs, we have revised several of the proposed definitions in response to comments we received. The definitions for terms used in the FSVP regulation are set forth in § 1.500.

1. Definitions Generally

(Comment 1) Some comments suggest that we use the same definition for terms used in different FSMA rulemakings.

(Response 1) We agree and have aligned the definitions used in the different regulations as much as possible. However, in some cases the definitions of terms differ because of differences in the applicable statutory provisions or in the scope or purpose of the regulations.

2. Audit

We proposed to define “audit” as the systematic, independent, and documented examination (through observation, investigation, records review, and, as appropriate, sampling and laboratory analysis) to assess a foreign supplier's food safety processes and procedures.

On our own initiative, we have changed the definition to refer to an “audited entity” rather than a “foreign supplier” because in some cases an importer might conduct (or rely on the results of) an onsite audit of an entity other than the foreign supplier (such as a foreign supplier's supplier) to meet FSVP requirements. In addition, consistent with auditing practice we have added discussions with employees of the audited entity to the list of activities that might be included in an audit.

(Comment 2) One comment recommends that we interpret an “independent” examination as including audits other than third-party audits, such as audits conducted by the importer or the importer's customer.

(Response 2) To the extent the comment is requesting that the definition of the term “audit” allow an importer to rely on an audit conducted by the importer itself, we agree. To the extent, however, the comment is requesting that there be no requirements for the independence of auditors, we disagree. Any qualified auditor conducting an audit relied upon by an importer would need to meet the requirements for independence set forth in § 1.506(e)(4), discussed in section III.G.7 of this document. Note, however, that under § 1.506(e)(2)(i) an importer cannot rely on a supplier's self-audit to fulfill the importer's requirement to conduct supplier verification under § 1.506 (because the supplier would have an inherent conflict of interest regarding the audit results).

(Comment 3) One comment requests that sampling and laboratory analysis not be specified as a potential component of an audit because they are separate verification activities.

(Response 3) While sampling and laboratory analysis might in some instances be conducted instead of an audit or other verification activities, we do not agree that sampling and laboratory analysis cannot also be included as a component of an audit. A qualified auditor might reasonably determine that it is appropriate to include some sampling and testing of a food or raw material or other ingredient as part of an onsite audit of a foreign supplier.

3. Environmental Pathogen

We proposed to define “environmental pathogen” as a pathogen that is capable of surviving and persisting within the manufacturing, processing, packing, or holding environment such that food may be contaminated and may result in foodborne illness if that food is consumed without treatment to significantly minimize or prevent the environmental pathogen. The proposed definition also specified that environmental pathogens do not include the spores of pathogenic sporeformers. To provide additional clarity, the final rule specifies in the definition that examples of environmental pathogens include
Listeria monocytogenes
and
Salmonella
spp.

(Comment 4) Some comments suggest that instead of a “pathogen,” the definition of environmental pathogen

should refer to “pathogenic bacteria” because the latter term is considered more relevant to protecting food safety.

(Response 4) We do not agree. Pathogens other than bacteria might be capable of surviving in a manufacturing environment, cause food to be contaminated, and result in foodborne illness.

4. Farm

We are adding a definition of “farm” to the final rule. A “farm” is a farm as defined in § 1.227 (21 CFR 1.227) in the regulation on registration of food facilities.

5. Farm Mixed-Type Facility

We are adding a definition of “farm mixed-type facility” to the final rule. A “farm mixed-type facility” is an establishment that is a farm but that also conducts activities outside the farm definition that require the establishment to be registered under section 415 of the FD&C Act (21 U.S.C. 350d).

6. Food

We proposed to define “food” as having the meaning given in section 201(f) of the FD&C Act (21 U.S.C. 321(f)), except that food would not include pesticides as defined in 7 U.S.C. 136(u).

(Comment 5) Several comments request that we exclude food contact substances from the definition of food because facilities that manufacture, process, pack, or hold food contact substances are not required to register with FDA and therefore are not subject to the proposed regulations on preventive controls. One comment suggests that we either exclude food packaging from the FSVP regulation or establish modified requirements for packaging.

(Response 5) We do not agree that it is appropriate to exclude food contact substances (including food packaging), as defined in section 409(h)(6) of the FD&C Act (21 U.S.C. 348(h)(6)), from the definition of “food” for FSVP purposes. The definition of “food” in § 1.227, for the purposes of food facility registration, excludes food contact substances as defined in section 409(h)(6) of the FD&C Act. Consequently, a facility that manufactures/processes, packs, or holds food contact substances is not required to be registered. Because section 418 of the FD&C Act only applies to establishments that are required to register, facilities involved in the manufacturing/processing, packing, and holding of food contact substances are not subject to the preventive control regulations implementing section 418. Section 805 of the FD&C Act, however, is not similarly limited to facilities that are required to register. Instead, section 805 applies to imports of “food.” The term “food” is defined in section 201(f)(3) of the FD&C Act to include articles used as components of food, and the case law interpreting the definition makes clear that many substances that meet the definition of food contact substances under section 409(h)(6) of the FD&C Act also meet the definition of food (see,
e.g., Natick Paperboard
v.
Weinberger,
525 F.2d 1103 (1st Cir. 1975) (paperboard containing PCBs intended for food use is adulterated food);
U.S.
v.
Articles of Food 688 Cases of Pottery (Cathy Rose),
370 F. Supp. 371 (E.D. Mi. 1974) (ceramic pottery that leaches lead is adulterated food)). Further, we do not believe there is any evidence that Congress intended to exclude food contact substances from being considered “food” for purposes of section 805 and the FSVP regulation.

(Comment 6) Several comments request that we add raw materials and other ingredients to the definition of food for clarity and for consistency with the definition of food in the preventive controls regulations.

(Response 6) We conclude that the suggested change is unnecessary because the definition of food in section 201(f) of the FD&C Act, which we are incorporating in the FSVP regulation, defines food as including articles used for components of any such food or drink for man or animals, which includes raw materials and other ingredients.

(Comment 7) One comment states that chemicals used in processing foods (
e.g.,
hydrochloric acid in the production of cheese) that are declared as food-grade most likely will be used in food production but sometimes will not be used for such purposes. The comment asks that we provide guidance on how to address such imported chemicals.

(Response 7) As explained in section III.B.9 of this document, substances such as chemicals that are capable of food and non-food use are subject to the FSVP regulation if they are reasonably likely to be directed to a food use. In the example provided by the comment, the application of the FSVP regulation would not be based solely on whether a substance is declared as food-grade. However, we would consider the fact that the chemical is declared as food-grade in determining whether the chemical is reasonably likely to be directed to a food use.

7. Foreign Supplier

We proposed to define “foreign supplier” as, for an article of food, the establishment that manufactures/processes the food, raises the animal, or harvests the food that is exported to the United States without further manufacturing/processing by another establishment, except for further manufacturing/processing that consists solely of the addition of labeling or any similar activity of a de minimis nature.

In the preamble to the proposed rule, we stated that the proposed definition of foreign supplier was generally consistent with the definition of a foreign facility under the preventive controls section (section 418) of the FD&C Act. However, we stated that the proposed definition of foreign supplier did not include firms that only pack or hold food, with no or de minimis manufacturing/processing (even if the firm is required to register with FDA under section 415 of the FD&C Act) because we tentatively concluded that Congress intended the importer to verify a single foreign supplier for a particular shipment of a food and, when several entities are required to register as foreign facilities with respect to this food, excluding a subsequent registered packer or holder who does not do any significant manufacturing/processing would be consistent with this intent. We also stated that the proposed exclusion from the definition of foreign supplier of any establishment engaging in further manufacturing/processing of a food that consists solely of the addition of labeling or any similar activity of a de minimis nature was consistent with FDA regulations on the registration of foreign food facilities in subpart H of part 1 (see 21 CFR 1.226(a)).

(Comment 8) Several comments oppose the proposed definition of foreign supplier because they believe it would require importers to go more than “one step back” in the supply chain to conduct supplier verification. The comments maintain this would be inconsistent with section 204(d)(1)(L)) of FSMA and the section 414 of the FD&C Act (21 U.S.C. 350c)). The comments assert that, when foods are obtained from entities such as brokers, distributors, and consolidators, rather than the entity that manufactured/processed, raised, or harvested the food, it would be difficult for the importer to know the identity of the producer because the consolidator might refuse to reveal this information due to concern that the importer might decide to buy directly from the producer in the future. The comments also maintain that in these circumstances, particularly with consolidated or commingled RACs, it would be impractical and burdensome to have to conduct supplier verification of the original producer of the food and could result in multiple audits of the

same farm or manufacturer. Therefore, some comments request that we define the foreign supplier as the immediate previous source of an imported food. The comments assert that under this definition, importers would conduct verification activities to assess the supplier's ability to verify that its suppliers (growers or manufacturers) were producing food consistent with U.S. requirements.

(Response 8) Although we understand the concerns related to obtaining food from an entity that did not manufacture/process, raise, or harvest the food, such as distributors, warehouses, and consolidators of RACs, we decline to revise the definition of foreign supplier as suggested. The other FSMA and FD&C Act provisions noted by the comments were enacted to serve different purposes than the FSVP provisions. Section 805(c)(2)(A) of the FD&C Act specifically directs FDA to adopt regulations requiring that each importer's FSVP is adequate to provide assurances that “the foreign supplier to the importer
produces
the imported food” (emphasis added) in compliance with the applicable U.S. standards. Therefore, we conclude that Congress did not intend supplier verification to be conducted for entities that only perform activities of a de minimis nature with respect to the imported food. Consequently, we conclude that it would not be appropriate to define “foreign supplier” so that the importer would be conducting supplier verification of an entity in the supply chain that did not perform any significant processing step, such as distributors and some consolidators of RACs.

However, we understand that the requirement to perform supplier verification on the establishment that manufactures/processes, raises, or grows the imported food could impose a greater burden on importers when the foreign supplier is not the immediate source of the imported food, such as the case with consolidated RACs. To address this concern, we have revised the provisions on hazard analysis, evaluation for foreign supplier approval and verification, and supplier verification activities to allow an importer of a food to obtain information needed to meet certain FSVP requirements from other entities, such as a distributor or consolidator of that food. As discussed in sections III.E.5, III.F.4, and III.G.4 of this document, an importer may review and assess hazard analyses, evaluations of the risk posed by a food and the foreign supplier's performance, determinations of appropriate foreign supplier verification activities, and results of such activities conducted by other entities for an imported food to meet its FSVP requirements in these areas. We anticipate that many importers will be able to rely on activities conducted by other entities, which will reduce the need for importers to directly verify the compliance of producers from which the importers did not directly purchase the imported food. We conclude that this approach to foreign supplier verification ensures that the FSVP requirements are consistent with FSMA while limiting the burden that otherwise might be imposed on importers when the foreign supplier of a food is not the importer's direct source for the food.

(Comment 9) One comment states that firms that pack or hold food products (other than of de minimis value) could introduce hazards during these operations. The comment maintains that the proposed definition of foreign supplier conflicts with the definition of facility in the FD&C Act and appears contrary to the intent of ensuring the safety of imported food. One comment asks that we revise the definition of foreign supplier to clarify that, in addition to an entity that harvests a food, a foreign supplier might be the establishment that owns (or owns and packs) a harvested food.

(Response 9) We decline to change the definition of foreign supplier to include entities that only own, pack, or hold food. We conclude that defining foreign supplier to include a firm that only owns or packs or holds a food would not be consistent with Congressional intent, because it would have the effect of requiring that importers verify the establishment that merely owns, packs, and/or holds a food—as opposed to the establishment that “produces” a food. As stated previously, in enacting section 805(c)(2)(A) of the FD&C Act, Congress specifically directed us to adopt regulations requiring that each importer's FSVP is adequate to provide assurances that “the foreign supplier to the importer
produces
the imported food” (emphasis added) in compliance with the applicable U.S. standards.

(Comment 10) Two comments request that we revise the definition of foreign supplier to include an exception for activities conducted on RACs that do not change the RAC into processed food. The comments maintain that farms that grow and harvest produce should not be regarded as foreign suppliers if the produce is sent to a packing operation that is not part of the farm before the produce is exported. The comments assert that because the packing operation is a separate entity from the farm, the activities performed at the packing operation (such as washing and grading) should be considered manufacturing/processing by another establishment. The comments ask that we revise the definition of foreign supplier as follows:

• Specify that activities with RACs that do not change the RAC into processed food would not constitute further manufacturing/processing that would make an establishment a foreign supplier.

• State that when an entity aggregates a RAC from multiple farms without changing the RAC into processed food, the aggregator and the farm that produced the RAC will both be considered foreign suppliers.

(Response 10) We decline to revise the definition of foreign supplier as requested. In general, though not always, an entity between the farm and the importer that performs an activity that does not change a RAC into processed food would not be the foreign supplier of the RAC because, in most but not all cases, that entity would most likely not be manufacturing/processing the RAC but would only be packing or holding the RAC. For example, a packing operation that is a separate entity from a farm that only washes and grades produce RACs incidental to packing and holding the RACs is not manufacturing/processing the RACs but only packing and holding them.

We also conclude it would not be consistent with FSMA to designate multiple foreign suppliers of the same food, which would result by specifying that both the aggregator in the example and the farm that grew the RAC would be foreign suppliers of that RAC. If an aggregator is merely packing and/or holding RACs, and not performing manufacturing/processing (and no other foreign entity is doing more than de minimis manufacturing/processing of the food before export), then the farm that grew the RAC would be the foreign supplier of the RAC.

(Comment 11) One comment asks that we clarify whether food facilities required to register, such as off-farm packing houses, are foreign suppliers. This comment also asks whether farms that are not required to register and that have on-farm packing operations are foreign suppliers. Noting that RACs often are harvested by a contract harvest company, the comment also asks us to clarify what is meant by “establishment that harvests a food” and whether, in such circumstances, the foreign supplier of the RAC would be the contract harvest company or the establishment that owns the crop and sells it to an importer.

(Response 11) The foreign supplier of a crop that is grown and harvested would either be the establishment that grew the food or, if another foreign entity later manufactured/processed the food (performing an activity of a more than de minimis nature), the foreign supplier would be the last entity in a foreign country that performed such a manufacturing/processing activity. Because, as previously stated, the definition of foreign supplier does not include firms that only pack or hold food, off-farm packing houses that solely pack or hold food would not be foreign suppliers. In such cases, assuming that no other foreign entity manufactures/processes the food (performing an activity of more than a de minimis nature) after it is grown, the farm that grows the food is the foreign supplier. Similarly, provided that no foreign entity manufactures/processes the food (performing an activity of more than a de minimis nature) after it is grown, farms that grow food and also have on-farm packing operations are foreign suppliers of the food they grow because they grew the food.

Our consideration of the comment on contract harvesting, and of comments we received on the definition of “farm” in the rulemaking on preventive controls for human food, has led us to change the definition of foreign supplier as it relates to farming operations and to make other changes to clarify the importer's responsibilities when multiple entities in its supply chain control different hazards in the same food. The definition of “farm” in the proposed rule on preventive controls for human food referred to an entity “devoted to the growing
and
harvesting of crops, the raising of animals (including seafood), or both” (78 FR 3646 at 3795, January 16, 2013) (emphasis added). However, as discussed in the preamble to the final rule on preventive controls for human food, farming operations can take diverse forms, including those in which multiple growers share ownership of a packinghouse and those in which separate operations grow and harvest a crop (80 FR 55908 at 55926 to 55927, September 17, 2015). Therefore, the definition of farm in § 1.227 (which is included in the definitions applicable to the FSVP regulation under § 1.500 of the final rule) refers to a “primary production farm” as an operation devoted to the “growing of crops, the harvesting of crops, the raising of animals (including seafood), or any combination of these activities.” This change to the definition of farm accommodates business models in which growing, harvesting, and packing operations—each of which requires the application of controls—are conducted by different business entities.

When we referred, in the FSVP proposed rule, to an establishment that “harvests the food” as being the foreign supplier, we assumed that the grower of a food was also the harvester, and because harvesting followed growing, it was appropriate to refer to the harvesting, rather than growing, of a food in the definition of foreign supplier. However, as noted by the comment and discussed in the previous paragraph, a food is not always grown and harvested by the same establishment. Given the possibility that the growing and harvesting of a food might be conducted by separate entities, we conclude that, for purposes of the definition of “foreign supplier,” it is appropriate to regard the grower of a food, rather than the harvester, as the foreign supplier of the food. Although there are some hazards that must be controlled during harvesting (
e.g.,
worker hygiene, water quality), we believe that most people would regard the farm that grows a crop as the producer of the food rather than the establishment that harvests the crop. Given the potential complexities associated with different harvesting contractual relationships, the grower of a crop may be more easily identifiable than the harvester. In addition, making the grower the foreign supplier facilitates onsite auditing of the supplier because there is a clearly defined physical location for the farm on which the crop is grown, while the entity conducting harvesting might not own or have control over the site at which harvesting occurs (
e.g.,
mobile harvesting operations).

This change in the definition of foreign supplier from the harvester of a food to the grower of the food means that, when food is harvested on a farm by a contract harvest company, even one that takes ownership of the food, the grower of the food would be the foreign supplier (provided that no other foreign entity manufactures/processes the food by performing an activity of more than a de minimis nature).

Although the final rule defines the grower of a food, rather than the harvester, as the foreign supplier, the importer still must obtain assurances that hazards associated with the harvesting and packing of food are being significantly minimized or prevented. Without such assurances, we conclude that an importer could not meet its obligation under section 805(a)(1) of the FD&C Act of verifying that imported food is produced in compliance with sections 418 and 419, as applicable, and that such food is not adulterated under section 402 or misbranded with respect to allergen labeling under section 403(w). We address this issue further in the discussion of the determination of appropriate supplier verification activities in section III.G.4 of this document.

(Comment 12) One comment asks that we clarify how the definition of foreign supplier compares to the definitions of “grower” and “manufacturer” in the prior notice regulation. The comment asks whether the terms grower and manufacturer, collectively, equate to the term foreign supplier. The comment notes that “grower” is defined in the prior notice regulation (21 CFR part 1, subpart I) in 21 CFR 1.276(b)(7) as a person who engages in growing and harvesting or collecting crops (including botanicals), raising animals (including fish, which includes seafood), or both; “manufacturer” is defined in § 1.276(b)(9) as the last facility (as defined in § 1.227) that manufactured/processed the food. Under § 1.227, a facility is considered the last facility even if the food undergoes further manufacturing/processing that consists of adding labeling or any similar activity of a de minimis nature.

(Response 12) As previously stated, the final rule defines the foreign supplier of a crop as the grower of the food rather than the harvester. Consequently, with respect to food that is grown, the definition of “foreign supplier” for FSVP purposes differs from the definition of “grower” under § 1.276(b)(7), which includes both growing and harvesting. Regardless, definitions used in the prior notice regulation do not apply to words or phrases in the FSVP regulation, and vice versa.

(Comment 13) One comment asks that the definition of foreign supplier exclude farms that grow non-produce botanical, algal, or fungal RACs. The comment asserts that these products have a complicated supply chain that makes it difficult to identify the farms that grow them, there are no public health reasons to identify these farms, and there are no regulations governing the production of these products.

(Response 13) We decline to adopt a different approach for these particular types of RACs compared to the previously stated approach to defining the foreign supplier of a RAC. Provided these products are being imported for use as food as defined in 201(f) of the FD&C Act, importers of these products are subject to FSVP. However, the FSVP regulation does not require that the importer be the entity to gather

information about the farms. Rather, the regulation allows importers of such RACs to obtain information from other entities in the supply chain for the RAC to meet the importers' FSVP requirements for these products, provided the importer reviews and assesses the information and documents the review and assessment.

(Comment 14) Several comments request that we clarify whether certain activities are “de minimis” activities and therefore would mean the entity performing these activities for a food would not be the foreign supplier of the food. Some comments ask whether waxing, cooling, washing, and repacking are de minimis activities. Some comments maintain that sorting, packing, cooling, and holding of produce by packing houses should be regarded as de minimis activities, as should farm activities such as waxing, sorting, culling, conveying, storing, labeling, packing, packaging, and shipping of RACs.

(Response 14) The foreign supplier is the establishment that manufactures/processes the food, raises the animal, or grows the food that is exported to the United States without further manufacturing/processing except for the addition of labeling or any similar activity of de minimis nature. This means that a foreign supplier is not an entity that merely performs de minimis manufacturing/processing activities, but, importantly, a foreign supplier also is not an entity that only packs or holds a food.

Whether an activity is harvesting, manufacturing/processing, packing, or holding can depend on the circumstances. For example, packing, cooling, and holding performed by an off-farm packing house (that only packs and holds produce and cools the produce incidental to packing and holding) would not make the packing house the foreign supplier, because these activities would not be considered manufacturing/processing but only packing and holding. Waxing, sorting, culling, conveying, storing, packing, and shipping of RACs when conducted on a farm would generally be considered harvesting, packing, or holding. Assuming the farm conducting these activities grows the RACs and no other entity manufactures/processes the food (except de minimis manufacturing/processing) before it enters the United States, the farm would be the foreign supplier.

With regard to the packaging of RACs, packaging is a manufacturing/processing activity but is specifically included within the farm definition. A farm that raises an animal or grows a crop and performs packaging operations would be the foreign supplier (assuming that no other entity manufacturers/processes the food except for de minimis manufacturing/processing).

Concerning the comment's reference to re-packing, re-packing is a packing activity (
i.e.,
the definition of packing includes re-packing), not a manufacturing/processing activity. We regard waxing and cooling RACs, when done by a packing operation for purposes of storage or transport, to be packing activities rather than manufacturing/processing activities.

To help explain FDA's current thinking on the classification of activities as “harvesting,” “packing,” “holding,” or “manufacturing/processing,” we will issue a draft guidance for industry on preventive controls for human food. We intend for this guidance, when finalized, to provide sufficient examples of activities within each of these definitions to inform both industry and regulators of those activities we consider to be within those definitions. The draft guidance will be available for public comment in accordance with our regulation on good guidance practices (see 21 CFR 10.115(g)(1)). We will consider comments we receive on the draft guidance in developing the final guidance.

(Comment 15) One comment, noting that coffee beans are extracted from the cherry surrounding the bean by fermentation, washing, and/or drying at a mill, asserts that because these activities are more than de minimis in nature, the mill should be regarded as the foreign supplier of the coffee beans.

(Response 15) We agree that fermentation, washing, and/or drying of raw coffee cherries (or “berries”) would constitute manufacturing/processing that is not of a de minimis nature and would make the mill the foreign supplier of the coffee beans (provided no subsequent entity conducted additional manufacturing/processing that is not of a de minimis nature before export to the United States). We note, however, that under § 1.507(a)(1) of the final rule, importers of foods that cannot be consumed without the application of an appropriate control, including RACs like coffee beans, are not subject to the full requirements of the FSVP regulation (see the discussion in section III.H.1 of this document).

(Comment 16) One comment asks that we distinguish “further manufacturing/processing by another establishment” under the proposed definition of foreign supplier from the concept of substantial transformation applied by U.S. Customs and Border Protection (CBP).

(Response 16) The concept of “further manufacturing/processing by another establishment” in the definition of “foreign supplier” under the FSVP regulation and the definition of “substantial transformation” as used by CBP (
i.e.,
the emergence of an article from manufacturing processes as a new and different article, with a distinctive name, character, or use) are used for different purposes and do not necessarily refer to the same processes. Further manufacturing/processing in the context of FSVP involves direct manipulation of a food, but it need not result in a new and different article, as it can include activities such as washing and freezing.

8. Good Compliance Standing With a Foreign Food Safety Authority

We proposed to define “good compliance standing with a foreign food safety authority” as meaning the foreign supplier (1) appears on the current version of a list, issued by the food safety authority of the country in which the foreign supplier is located and which has regulatory oversight of the supplier, of food manufacturers and processors that are in good compliance standing with the food safety authority, or (2) has otherwise been designated by such food safety authority as being in good compliance standing. Under § 1.513 of the final rule (discussed in section III.N of this document), modified FSVP requirements apply, subject to certain conditions and requirements, to importers of certain types of food from foreign suppliers in countries whose food safety systems FDA has officially recognized as comparable or determined to be equivalent to the U.S. system. One of the requirements for eligibility for the modified requirements is that the foreign supplier must be in good compliance standing with the food safety authority of a country with a comparable or equivalent food safety system.

On our own initiative, we revised the definition to reference to “food producers” instead of “food manufacturers and processors” because farms might be included among food producers designated as being in good compliance standing by a foreign food safety authority.

(Comment 17) One comment questions the need for this term in the FSVP regulation given that all U.S. importers of food must ensure the safety of the food they import. The comment maintains that it is unclear whether or to what extent a foreign supplier's inclusion on a list maintained by a foreign food safety authority will

facilitate an importer's access to a foreign-supplied food. The comment also asserts that it is unclear whether any country's food safety authority can be required to develop and maintain such a list and suggests that there will be disparity among countries regarding whether such a list can and will be developed.

(Response 17) The term good compliance standing with a foreign food safety authority is used to describe one of the conditions under which an importer is eligible to import certain types of food under the modified requirements in § 1.513 of the final rule. We conclude it is appropriate to condition the use of these modified requirements on the foreign supplier of the food being in good compliance standing with the food safety authority of a country whose food safety system FDA has officially recognized as comparable or determined to be equivalent to that of the United States. If the foreign supplier is not in good compliance standing, we conclude that the importer would lack adequate assurances that the foreign supplier is producing the food consistent with U.S. requirements. Although foreign authorities will not be required to designate food producers as being in good compliance standing, we believe that it is likely that some authorities will decide to do so.

(Comment 18) One comment suggests that the official registration or approval of an establishment by the relevant competent authority should be considered sufficient to meet the requirement of good compliance standing. The comment asserts that because all food establishments in the European Union (EU) are either registered with, or approved by, the national authorities, the existence of the records of these actions should be taken into account to avoid unnecessary or duplicative work.

(Response 18) We do not agree. We conclude that the fact that a foreign supplier is registered with, or approved to operate by, the food safety authority of the country in which it is located would generally not constitute a designation that the foreign supplier was in good compliance standing with that authority, absent a determination or designation by a food safety authority indicating that the supplier is in good compliance standing within the meaning in § 1.500. We believe it is possible a foreign supplier might maintain its registration or approval to operate even while it is the subject of an ongoing enforcement action due to significant non-compliance. Therefore, a foreign supplier cannot be regarded as in good compliance standing with a food safety authority unless that authority has affirmatively designated that supplier as being in good compliance standing, either through the supplier's inclusion on a list of such suppliers, a company-specific certification, or some other manner of designation.

9. Harvesting

For clarity and consistency, we are adding a definition of “harvesting” that is consistent with the definition in the preventive controls regulations. Our new definition states that harvesting applies to farms and farm mixed-type facilities and means activities that are traditionally performed on farms for the purpose of removing RACs from the place they were grown or raised and preparing them for use as food. Harvesting is limited to activities performed on RACs on a farm. Harvesting does not include activities that transform a RAC into a processed food as defined in section 201(gg) of the FD&C Act. Examples of harvesting include cutting (or otherwise separating) the edible portion of a RAC from the crop plant and removing or trimming part of the RAC (
e.g.,
foliage, husks, roots or stems). Examples of harvesting also include cooling, field coring, filtering, gathering, hulling, removing stems and husks from, shelling, sifting, threshing, trimming outer leaves of, and washing RACs grown on a farm.

10. Hazard

We proposed to define “hazard” as any biological, chemical (including radiological), or physical agent that is reasonably likely to cause illness or injury in the absence of its control.

On our own initiative, we have deleted “in the absence of its control” from the definition, consistent with a corresponding change to the definition of hazard in the preventive controls regulations, because the aspect of control of a hazard is addressed under the definition of “hazard requiring a control.”

(Comment 19) One comment suggests limiting the definition of hazard by referring to an agent that is reasonably likely to cause illness or injury “in the intended species” in the absence of its control.

(Response 19) We do not believe that the suggested change to the definition of hazard is necessary. We note that under § 1.504(c)(3) of the final rule, in determining whether a hazard is a “hazard requiring a control,” an importer must consider, among other factors, the intended or reasonably foreseeable use of the food, including the species for which the food was intended.

11. Hazard Requiring a Control

In the Supplemental Notice, we proposed to adopt the term “significant hazard” and to define it as a known or reasonably foreseeable hazard for which a person knowledgeable about the safe manufacturing, processing, packing, or holding of food would, based on the outcome of a hazard analysis, establish controls to significantly minimize or prevent the hazard in a food and components to manage those controls (such as monitoring, corrections and corrective actions, verification, and records) as appropriate to the food, the facility, and the control.

(Comment 20) Some comments request that we use a term other than “significant hazard” to refer to a known or reasonably foreseeable hazard for which a knowledgeable person would establish a control. One comment maintains that use of the term “significant hazard” could be confusing because the term is used to refer to hazards addressed in a HACCP plan through critical control points. One comment recommends using the definition of “significant hazard” instead of the term itself. Some comments recommend using the term “food safety hazard” because it has no association with HACCP principles. Some comments recommend using the term “hazard requiring control.”

(Response 20) To provide more clarity, we agree that the FSVP regulation should use a term other than “significant hazard.” We conclude it is appropriate to refer to such a hazard as a “hazard requiring a control.” The definition states, in pertinent part, that a “hazard requiring a control” is a known or reasonably foreseeable hazard for which a knowledgeable person would establish one or more “controls or measures” to significantly minimize or prevent the hazard. The definition refers to controls or measures because the FSVP requirements apply to food that is subject to the preventive controls regulations (which require the establishment of preventive “controls”), food that is subject to the produce safety regulation (which refers to safety “measures”), and food that is subject to other FDA regulations (
e.g.,
dietary supplement CGMPs).

(Comment 21) Some comments recommend replacing the reference to “a person knowledgeable about safe manufacturing, processing, packing, or holding food” with “a qualified individual” because a qualified individual will be responsible for conducting a hazard analysis.

(Response 21) Although a qualified individual must conduct a hazard analysis for a food, we decline to make this change to the definition of “hazard requiring a control” because we believe it is appropriate to specify that a person determining whether a known or reasonably foreseeable hazard is one for which one or more controls or measures are needed must be knowledgeable about the safe manufacturing, processing, packing, or holding of food. This is consistent with the revised definition of “hazard requiring a preventive control” in the preventive controls regulations.

(Comment 22) Some comments recommend stating in the definition of “significant hazard” (or its replacement term) that a determination of a significant hazard is based on a hazard analysis that assesses the severity of the illness or injury to humans or animals if the hazard were to occur and the probability that the hazard will occur in the absence of a control, because severity and probability are integral to determining whether a hazard is significant.

(Response 22) We agree with the comments that this additional language is helpful. Consistent with the revised definition of “hazard requiring a preventive control” in the preventive controls regulations, this change is incorporated in the definition of “hazard requiring a control,” which under the final rule means a known or reasonably foreseeable hazard for which a person knowledgeable about the safe manufacturing, processing, packing, or holding of food would, based on the outcome of a hazard analysis (which includes an assessment of the probability that the hazard will occur in the absence of controls or measures and the severity of the illness or injury if the hazard were to occur), establish one or more controls or measures to significantly minimize or prevent the hazard in a food and components to manage those controls or measures (such as monitoring, corrections or corrective actions, verification, and records) as appropriate to the food, the facility, and the nature of the control or measure and its role in the facility's food safety system.

(Comment 23) Some comments recommend that the definition of significant hazard reflect that components to manage controls should be appropriate not just to the food, the facility, and the control, but also to the intended use of the food.

(Response 23) We do not think this change to the definition of hazard requiring control is necessary because an importer already must consider the intended or reasonably foreseeable use of a food in evaluating the hazards in the food under § 1.504(c)(3) of the final rule.

12. Holding

On our own initiative, we are adding a definition of “holding” that is consistent with the preventive controls regulations. Our new definition states that holding means storage of food and also includes activities performed incidental to storage of a food (
e.g.,
activities performed for the safe or effective storage of that food, such as fumigating food during storage, and drying/dehydrating RACs when the drying/dehydrating does not create a distinct commodity (such as drying/dehydrating hay or alfalfa)). Holding also includes activities performed as a practical necessity for the distribution of that food (such as blending of the same RAC and breaking down pallets), but does not include activities that transform a RAC into a processed food as defined in section 201(gg) of the FD&C Act. Holding facilities could include warehouses, cold storage facilities, storage silos, grain elevators, and liquid storage tanks.

13. Importer

We proposed to define “importer” as the person in the United States who has purchased an article of food that is being offered for import into the United States. The proposed definition further stated that:

• If the article of food has not been sold to a person in the United States at the time of U.S. entry, the importer is the person in the United States to whom the article has been consigned at the time of entry; and

• If the article of food has not been sold or consigned to a person in the United States at the time of U.S. entry, the importer is the U.S. agent or representative of the foreign owner or consignee at the time of entry.

We proposed this definition of importer based on the statutory definition of importer in section 805(a)(2) of the FD&C Act, which states that the importer is the U.S. owner or consignee of an article of food at the time of entry of the article into the United States, or if at that time there is no U.S. owner or consignee, the importer is the U.S. agent or representative of the foreign owner or consignee.

On our own initiative, we are revising the definition of “importer” to mean the U.S. owner or consignee of an article of food that is being offered for import into the United States. If there is no U.S. owner or consignee at the time of U.S. entry, the importer is the U.S. agent or representative of the foreign owner or consignee at the time of entry, as confirmed in a signed statement of consent to serve as the importer under the FSVP regulations. We conclude that this revised definition is more consistent with the statutory definition in section 805(a)(2). For the reasons explained in the following paragraphs, we also conclude that this change, along with a new definition we are adding for “U.S. owner or consignee,” better ensures that the FSVP importer is a person who has a financial interest in the food and has knowledge and control over the food's supply chain. We are defining “U.S. owner or consignee” to mean the person in the United States who, at the time of entry of a food into the United States, either owns the food, has purchased the food, or has agreed in writing to purchase the food.

a. General

(Comment 24) Some comments ask that we either define or clarify the term “purchased.” One comment states that CBP defines the terms owner and purchaser to include any party with a financial interest in a transaction, including, but not limited to, the actual owner of the goods, the actual purchaser of the goods, a buying or selling agent, a person or firm who imports for exhibition at a trade fair, or a person or firm who imports foods for repair or alteration. One comment maintains that in contrast to the proposed rule, the statute does not create different rules for U.S. owners and their consignees regarding their FSVP responsibilities and does not define the importer as the person who purchased an article of food. The comment asserts that because neither the statute nor the proposed rule defines “purchased,” it is unclear who is responsible for ensuring FSVP compliance.

(Response 24) We do not agree that the proposed definition would create different FSVP regulations for U.S. owners and consignees, as the proposed rule contained no requirements that differed on that basis. However, to prevent possible confusion regarding the definition of importer and to align more closely with the statutory text, we have revised the definition of importer to mean the U.S. owner or consignee of an article of food that is being offered for import into the United States. We are further defining “U.S. owner or consignee” as the person in the United States who, at the time of entry of a food into the United States, either owns the food, has purchased the food, or has agreed in writing to purchase the food. Thus, the final rule explicitly refers to

a U.S. “owner” of a food. Because there is a wide range of commercial arrangements between foreign owners and U.S. persons, there may be situations in which ownership of imported food has not transferred from the foreign owner at the time of entry to the United States, but a person in the United States has nevertheless purchased or agreed in writing to purchase the goods. We do not agree it is necessary to define the terms “purchased” or “purchase,” but we understand the terms to mean obtain by paying money or its equivalent.

(Comment 25) Some comments request that we clarify that the FSVP importer of a food is not necessarily the importer of record for the food as defined by CBP. However, some comments suggest that instead of creating a new definition of importer, we should adopt a definition that parallels CBP's definition of importer of record. The comments note that under 19 U.S.C. 1484(2)(B), an “importer of record” is defined as the owner or purchaser of the merchandise or, when appropriately designated by the owner, purchaser, or consignee of the merchandise, a person holding a valid customs broker license. The comments maintain that this definition of importer of record is substantially similar to the statutory definition of importer under FSMA. (The comments also note that CBP regulations (19 CFR 101.1) define “importer” as the person primarily liable for the payment of any duties on the merchandise or an authorized agent.) The comments maintain that CBP's definition of importer has been effective in ensuring proper enforcement of collection of customs duties and provides certainty by defining a single party responsible for entry of a product.

(Response 25) We do not agree that it is appropriate to define “importer” for FSVP purposes to match CBP's definition of “importer” or “importer of record.” As we stated in the preamble to the proposed rule, the importer of a food for FSVP purposes might be, but would not necessarily be, the importer of record of the food under CBP provisions (
i.e.,
the individual or firm responsible for making entry and payment of import duties). We conclude that, in section 805(a)(2) of the FD&C Act, Congress adopted a definition of importer that suits the purposes of the FSVP regulation because:

• It clearly specifies the person who will be responsible for ensuring that supplier verification activities are conducted for each food imported into the United States; and

• By specifying the U.S. owner or consignee, the definition helps to ensure that the person responsible for meeting the FSVP requirements has a financial interest in the food and has knowledge and control over the food's supply chain.

The “U.S. owner or consignee” of a food, as we have defined the term, is more likely to have knowledge of food safety practices and control over the supply chain of an imported food than a customs broker, who often is the importer of record of a food for CBP purposes. Although the CBP definition of importer may be effective in ensuring collection of customs duties and otherwise meeting CBP requirements, that is not the purpose of the FSVP regulation. Consequently, the final rule adopts a definition of importer that best serves the purposes of the FSVP requirements, consistent with the statutory provisions the FSVP regulation must implement.

(Comment 26) Some comments maintain that the importer should be the person who has a direct financial interest in the imported food or, alternatively, the last known exporter. The comments assert that the only parties who can ensure the safety of the food supply chain are entities who are directly and financially involved in the manufacture, growth, sale, receipt, or purchase of the imported food.

(Response 26) As previously stated, the definition of importer is intended in part to ensure that someone with a financial interest in the imported food, as well as knowledge and control over the food's supply chain, is responsible for meeting the FSVP requirements. In most cases, this will be the U.S. owner or consignee of the food. However, under section 805(a)(2) of the FD&C Act and § 1.500 of the final rule, the importer for FSVP purposes could not be the exporter in the foreign country in which the food was produced. If there is no U.S. owner or consignee of a food at the time of the food's entry into the United States, the foreign owner or consignee of the food must have validly designated a U.S. agent or representative (in accordance with § 1.509(b) of the final rule) to serve as the U.S. importer of the food for purposes of FSVP compliance. We do not agree that the last known exporter is an appropriate person to serve as the FSVP “importer” because such a person exports—as opposed to imports—the food.

(Comment 27) One comment states that retailers may contract with foreign manufacturers to produce private label products bearing the retailer's name and purchase the products from a U.S. firm after the products have entered the United States. The comment asks us to clarify that in this situation, the retailer would not be the importer of the food for FSVP purposes.

(Response 27) We agree that provided a U.S. entity other than the retailer owns the food, has purchased the food, or has agreed in writing to purchase the food at the time of entry (
i.e.,
is the “U.S. owner or consignee”), the retailer would not be the FSVP importer of the food. In this situation, the importer is the U.S. firm that owns the product, has purchased the product, or has agreed in writing to purchase the product when it is offered for import into the United States and the entry documentation is submitted or presented. It would not be relevant that the retailer was the entity that entered into a contract with the foreign manufacturer (as long as the retailer is not the person in the United States that owns the food, has purchased the food, or has agreed in writing to purchase the food at the time of entry). If, on the other hand, the retailer owns the food, has purchased the food, or has agreed in writing to purchase the food at the time of entry (and thus is the U.S. owner or consignee), the retailer would be the FSVP “importer.”

(Comment 28) One comment asks that we clarify that a restaurant owner is not an “importer” for FSVP purposes unless it directly imports a food for its use and chooses to accept the responsibilities of the importer. The comment asserts that failing to do this would place an added burden on restaurant owners and operators who will have to make clear to their suppliers of foreign materials that the suppliers are responsible for compliance with FSVP requirements. The comment maintains that adoption of the FSVP regulation might result in a loss of U.S. importers of foreign products due to their unwillingness to assume responsibility for FSVP compliance.

(Response 28) A restaurant located in the United States must comply with the FSVP requirements only if it meets the definition of importer under § 1.500 (
e.g.,
because it is the “U.S. owner or consignee” of the food at the time of entry or, if there is no U.S. owner or consignee at the time of entry, the foreign owner or consignee designates the restaurant as a U.S. agent or representative for purposes of serving as the FSVP “importer”). If the restaurant purchases the food from another U.S. entity, the restaurant would not meet that definition and would not be responsible for meeting the FSVP requirements. However, we have added flexibility in the final rule to allow importers, including restaurants, to

meet their FSVP obligations by relying on analyses, evaluations, and activities performed by certain other entities, provided those importers review and assess the corresponding documentation (see sections III.E.5, III.F.4, and III.G.4 of this document).

(Comment 29) One comment asks that we define the phrase “time of U.S. entry” as used in the proposed definition of importer.

(Response 29) Section 805(a)(2)(A) of the FD&C Act provides that for purposes of the FSVP regulation, the term “importer” means the United States owner or consignee of the article of food “at the time of entry of such article into the United States.” The meaning of the phrase “at the time of entry of such article into the United States” is ambiguous. It could mean that the importer is the U.S. owner or consignee at the time of submission of an entry or at the time that the article of food physically enters U.S. territory. Given it might not always be clear when an imported item physically enters U.S. territory, we conclude that Congress intended that the importer be the U.S. owner or consignee at the time of submission of entry documents. Therefore, “time of U.S. entry,” as used in § 1.500, is the time when an import entry is submitted to CBP either electronically or in paper form. Because we believe that entities engaged in the import of food into the United States will understand this term, we do not think it is necessary to include a definition for “time of entry” in these regulations.

(Comment 30) One comment expresses concern that the proposed definition of importer will create a new layer of middlemen who would assume ownership of food at the time of entry into the United States and charge fees for ensuring compliance with the FSVP requirements. The comment contends this might result in duplicative foreign supplier verifications.

(Response 30) We do not agree. We believe it is unlikely that many entities currently not food importers will enter the food importing business because of the need to adopt and implement the procedures required under the FSVP regulation. Some importers may choose to hire employees or outside consultants to assist them in meeting the FSVP requirements, but this would not need to involve third parties assuming ownership of imported food or otherwise serving in an importer role solely for the purpose of providing supplier verification services. Even if new, FSVP-oriented businesses are created to conduct supplier verification activities on behalf of some importers, we do not see how this would result in duplicative supplier verification. Regardless, the definition of “importer” is consistent with the definition established by Congress in section 805(a)(2) of the FD&C Act.

(Comment 31) Some comments request that we define the term “consignee” because it might be confused with a similar term used by CBP. In addition, some comments suggest that the term “consignee” be restricted to persons with a direct ownership interest in the product.

(Response 31) We agree with the comments to the extent they are premised on a claim that the proposed rule did not clarify the meaning of “consignee.” Instead of defining the term “consignee,” however, we have revised the definition of “importer” so the FSVP importer is not, first, a U.S. owner, and, second, a U.S. consignee. There is no separate “consignee” category of persons who meet the definition of “importer.” Instead, under the revised definition, the “importer” is the “U.S. owner or consignee” of an article of food that is being offered for import into the United States. If there is no U.S. owner or consignee at the time of U.S. entry, the importer is the U.S. agent or representative of the foreign owner or consignee at the time of entry, as confirmed in a signed statement of consent to serve as the importer under the FSVP regulation.

At the same time, we are defining “U.S. owner or consignee” to mean the person in the United States who, at the time of entry of a food into the United States, either owns the food, has purchased the food, or has agreed in writing to purchase the food. Under the previously proposed definition of “importer,” the “consignee” category could have caused proprietors of the U.S. premises to which imported food is to be delivered to be designated as FSVP “importers,” even when such proprietors have no connection to the imported food other than the physical receipt—even temporary receipt—of the food. Under section 805(a)(2)(B) of the FD&C Act, Congress provided that when there is no U.S. owner or consignee, the FSVP importer should be the U.S. agent or representative of a foreign owner or consignee at the time of entry into the United States. If the consignee for purposes of FSVP included the proprietor of the U.S. premises to which the merchandise is to be delivered, we believe it would be unlikely an FSVP importer would ever be the U.S. agent or representative of a foreign owner or consignee, as contemplated by section 805(a)(2)(B), because the role of FSVP importer would fall to the proprietor of the premises before it would fall to the U.S. agent or representative. Moreover, we believe that a U.S. agent or representative of a foreign owner or consignee is more likely to have knowledge and control over the product's supply chain, and is therefore more likely to be able to perform supplier verification activities, than the proprietor of the U.S. premises to which the merchandise is delivered (in cases where the proprietor of the U.S. premises has no connection to the food other than physical receipt).

The effect of our change to the definition of “importer,” in conjunction with the new definition of “U.S. owner or consignee,” likely will result in different entities serving as the FSVP importer in some circumstances than those who might have served as the importer under the proposed definition. For instance, in the case of a Canadian company that ships a food product to a Montana warehouse and for which delivery is made to the Montana facility in anticipation of possible orders from customers in the United States, it is possible, under the proposed rule, that the warehouse would have been the FSVP “importer” because the food might be considered to be consigned to the warehouse at the time of entry and no one in the United States at the time of entry either owned or had purchased the food. Under the final rule, however, the warehouse would not necessarily be the FSVP importer. Because there is no person in the United States at the time of entry who owns the food, purchased the food, or promised to purchase the food, there is no “U.S. owner or consignee.” Therefore, the FSVP “importer” would have to be a properly designated U.S. agent or representative.

As for those comments suggesting that a consignee needs to be a person with a direct ownership in the product, we do not agree. Section 805(a)(2)(A) of the FD&C Act provides that “importer” for purposes of section 805 means the “United States owner
or
consignee” (emphasis added). Because Congress used the word “or” between “owner” and “consignee,” we believe Congress intended the “United States owner or consignee” to include persons other than owners. Requiring a U.S. owner or consignee to have direct ownership over the product would be inconsistent with that intent. We also understand it is possible for U.S. persons to purchase or agree in writing to purchase food at the time of entry to the United States, even if they do not yet own the products at that time. Requiring a U.S. owner or consignee to have direct ownership in the product at the time of entry would

not account for these types of commercial arrangements.

b. U.S. Agent or Representative

(Comment 32) Several comments maintain that the U.S. agent or representative for FSVP purposes should not necessarily be the same person as the U.S. agent for a foreign food facility under the FDA food facility registration regulation (§ 1.227) and section 415(a) of the FD&C Act. The comments note that while section 805(a)(2) of the FD&C Act describes an agent acting for the foreign owner or consignee of an article of imported food at the time of entry, section 415(a) describes an agent acting for a food facility. The comments assert that Congress did not require that the U.S. agent for a foreign food facility also act as the U.S. agent for FSVP purposes, and many persons who serve as U.S. agents for facility registration purposes might not have the knowledge or ability to meet the FSVP requirements. The comments request that the FSVP regulation clarify this distinction by referring to the “U.S. FSVP agent or representative.”

(Response 32) FDA agrees in part and disagrees in part. Section 805(a)(2)(B) provides that when there is no U.S. owner or consignee with respect to an article of food, the term “importer” for FSVP means “the
United States agent
or representative of a foreign owner or consignee of the article of food at the time of entry of such article into the United States” (emphasis added). Section 805 does not further define the term “United States agent.” In addition, section 415(a)(1)(B) of the FD&C Act provides that foreign food facilities must submit the name of the “United States agent” for the facility as part of the facility's registration under that section. FDA's regulation implementing the food facility registration requirements in section 415 of the FD&C Act specifies that the registration for foreign facilities must include the name of the U.S. agent for the facility (21 CFR 1.232(d)). The facility registration regulation also defines the term U.S. agent to mean a person (as defined in section 201(e) of the FD&C Act) residing or maintaining a place of business in the United States whom a foreign facility designates as its agent for purposes of food facility registration (§ 1.227). The regulation further specifies that the U.S. agent “acts as a communications link between FDA and the foreign facility for both emergency and routine communications”.

Although Congress used the term “United States agent” in both section 805(a)(2)(B) and section 415(a)(1)(B) of the FD&C Act, we do not interpret the use of the term “United States agent” in section 805(a)(2)(B) to mean the U.S. agent for a foreign facility under section 415(a)(1)(B). U.S. agents that foreign food facilities must designate for purposes of food facility registration perform a very different role than the “United States agent” that a foreign owner or consignee may designate under section 805(a)(2)(B) of the FD&C Act to serve as the “importer” for purposes of the FSVP regulations. For food facility registration, the “U.S. agent” acts as a communications link. For FSVP, however, an importer (whether a “United States agent” or otherwise) is responsible for the full breadth of supplier verification activities required under the FSVP regulation. These activities involve ensuring the safety of imported food, which is qualitatively different from serving as a communications link. Thus, we agree with the comments that urge us to not interpret the use of the term “United States agent” under section 805(a)(2)(B) to have the same meaning as the U.S. agent that food facilities are required to designate under section 415(a)(1)(B) and FDA's food facility registration regulation.

We note, however, that this interpretation does not prohibit a foreign owner or consignee from designating a person who serves as a U.S. agent under the food facility regulation as the “importer” for purposes of FSVP. To the contrary, under the definition of “importer” in § 1.500, in cases in which there is no U.S. owner or consignee, it is up to the foreign owner or consignee to determine which U.S. agent or other U.S. representative will serve as the FSVP “importer.” Whomever the foreign owner or consignee designates also may be listed as a foreign facility's U.S. agent for food facility registration purposes. We decline to adopt the term “U.S. FSVP agent or representative” because doing so is not necessary to prevent the kind of inadvertent or otherwise improper designation of FSVP importers contemplated by the comments.

(Comment 33) Some comments ask that we revise the definition of importer to specify that a person acting as a U.S. agent or representative of a foreign owner or consignee must knowingly and explicitly consent to serve as the U.S. agent or representative.

(Response 33) For cases in which a food has not been sold or consigned to a person in the United States at the time of entry, we proposed to required that, before an article of food is imported or offered for import into the United States, the foreign owner or consignee of the article must designate a U.S. agent or representative as the importer of the food for the purposes of the definition of “importer.” The final rule retains this requirement. Because we agree a U.S. agent or representative cannot truly function as the FSVP importer without having consented to do so, we are adding a clarification to the definition of “importer” explaining that in order for the foreign owner or consignee of the article to validly designate a U.S. agent or representative (when there is no U.S. owner or consignee) for purposes of the definition of “importer,” the U.S. agent or representative's role must be confirmed in a signed statement of consent. The signed statement of consent must confirm that the U.S. agent or representative agrees to serve as the importer under the FSVP regulation. Because a signed statement is an explicit acknowledgment of consent, we conclude that a signed statement is an effective way of ensuring the consent of U.S. agents and representatives. In addition, we will be able to inspect the signed statements, should the need arise, allowing us to verify the accuracy of “importer” designations under the FSVP regulation. Being able to verify the accuracy of such designations will allow us to more efficiently and effectively monitor compliance with, and enforce, section 805 of the FD&C Act.

(Comment 34) Several comments express concern about the manner in which a foreign owner or consignee would designate its U.S. agent or representative. The comments state that a foreign supplier might designate a party in the United States, such as the warehouse where the imported food will be stored, without seeking an affirmative acceptance from that party, or the foreign supplier of the food might assume the agent listed on its facility registration is also the U.S. agent for FSVP purposes. Some comments note concerns regarding the process for verification of U.S. agents of foreign facilities, including the absence of a requirement to obtain formal consent from a person to serve as the agent and FDA's failure to obtain confirmation of consent. Several comments suggest that, because the U.S. agent's responsibilities as the importer of a food under the FSVP regulation will be substantial, the regulation should require affirmative written acceptance by the designated firm for valid designation of a foreign owner or consignee's U.S. agent or representative.

(Response 34) We agree that a person should not be required to serve as the U.S. agent or representative of a foreign owner or consignee unless the person has agreed to serve in this capacity. As

explained in Response 33, we therefore are adding a clarification to the definition of “importer” stating that when the foreign owner or consignee of the article must designate a U.S. agent or representative (when there is no U.S. owner or consignee) for the purposes of the definition of “importer,” the U.S. agent or representative's role should be confirmed in a signed statement of consent. The signed statement of consent must confirm that the U.S. agent or representative agrees to serve as the importer under the FSVP regulation. In accordance with these changes, we also have revised the provisions regarding refusal of admission in proposed § 1.514(a) to specify that if there is no U.S. owner or consignee at the time an article of food is offered for entry into the United States, the article of food may not be imported into the United States unless the foreign owner or consignee has appropriately designated a U.S. agent or representative as the importer in accordance with § 1.500.

(Comment 35) One comment states that the requirement for foreign producers to obtain a U.S. agent in order for their product to be imported into the United States could be considered a technical barrier to trade according to the World Trade Organization (WTO).

(Response 35) We do not agree that the regulation requires that foreign producers obtain U.S. agents or otherwise imposes a barrier to trade. To the extent that the comment's reference to U.S. agents relates to who may be an FSVP “importer,” the definition of importer in § 1.500 is flexible and does not require that the importer be a U.S. agent. Instead, the FSVP importer is the U.S. owner or consignee of the imported food. A U.S. agent or representative functions as the FSVP importer of a food only if there is no U.S. owner or consignee of the food at the time of entry. Notably, the importer can be a foreign national residing in the United States and need not be a U.S. citizen. The definition of importer thus serves to identify persons with financial interests in the imported food who are likely to be able to ensure the safety of the food, while also providing flexibility that does not unduly burden trade.

(Comment 36) One comment states that FDA's explanation of the proposed definition of “importer” indicates the rule implies a regulatory pressure for foreign producers to sell or distribute products through U.S. persons in a manner inconsistent with U.S. obligations under the U.S.-Korea Free Trade Agreement (KORUS).

(Response 36) We do not agree that the definition of “importer” in § 1.500 is inconsistent with U.S. obligations under the KORUS. Under National Treatment and Market Access for Goods, Article 2.8.6 to 2.8.8, neither party may, as a condition for engaging in importation or for the importation of a good, require a person of the other party to establish or maintain a contractual or other relationship with a “distributor” in its territory. The term “distributor” under the KORUS is defined as a “person of a party” who is responsible for the commercial distribution, agency, concession, or representation in the territory of that party of goods of the other party. The term “person of a party” is defined as a national or an enterprise of a party to the agreement. The term “enterprise” means any entity constituted or organized under applicable law, whether or not for profit, and whether privately or governmentally owned or controlled, including any corporation, trust, partnership, sole proprietorship, joint venture, association, or similar organization.

The U.S. owner or consignee need not be a United States “distributor” within the meaning of the KORUS because it need not be a U.S. national or U.S. enterprise constituted or organized under U.S. law responsible for commercial distribution, agency, concession, or representation in the United States. For example, the U.S. owner or consignee could be a Korean national or enterprise residing or maintaining a place of business in the United States. Alternatively, if there is no U.S. owner or consignee of a food at the time of entry, the foreign owner or consignee could designate a U.S. agent or representative who is a Korean national (or a national of another country) but who resides or maintains a place of business in the United States. Under those circumstances, such a Korean national or enterprise would be the FSVP “importer.” Consequently, we are not requiring any person whose imports fall within the scope of the KORUS to establish or maintain a contractual or other relationship with a “distributor” or other entity in its territory. Therefore, the definition of “importer” is not inconsistent with U.S. obligations under the KORUS, and we do not believe the rule exerts any pressure on foreign producers to rely on U.S. persons to distribute food in a manner that is inconsistent with the KORUS.

14. Known or Reasonably Foreseeable Hazard

In the Supplemental Notice, we deleted the proposed term “hazard reasonably likely to occur” and replaced it with the term “known or reasonably foreseeable hazard.” We proposed to define “known or reasonably foreseeable hazard” as a potential biological, chemical (including radiological), or physical hazard that is known to be, or has the potential to be, associated with a food or the facility in which it is manufactured/processed.

(Comment 37) One comment suggests that we use the term “reasonably anticipated contaminants” as a phrase that clearly defines all hazards, whether deliberate or accidental, that can cause adulteration in the food supply.

(Response 37) We decline to make this change because “hazard” is a widely understood term in food safety and the word “contaminant” might suggest a substance that comes into contact with or is added to a food, but not all hazards arise from such contaminants. As discussed in section III.E.3.b of this document, importers are required to consider hazards that occur naturally, may be unintentionally introduced, or may be intentionally introduced for economic gain.

(Comment 38) One comment asks that we delete the reference to “potential” hazards as redundant because the proposed definition of “hazard” refers to agents “reasonably likely” to cause illness or injury.

(Response 38) We are deleting the word “potential” before the phrase “biological, chemical (including radiological), or physical hazard” because we agree the use of that word is redundant. The remaining portion of the definition of “known or reasonably foreseeable hazard” includes both a hazard that is known to be associated with a food or the facility in which it is manufactured/processed, as well as a hazard that “has the potential to be” associated with a food or facility.

(Comment 39) One comment requests that the definition of “known or reasonably foreseeable hazard” also refer to hazards that might be associated with the location or type of farm on which a food is grown or raised. The comment cites as an example the potential effect on a food of the agricultural methods used on the farm that produced the food.

(Response 39) We conclude this change is unnecessary because the potential effect of the location or type of farm on which a food is grown or raised on whether a hazard requires a control will be addressed as part of the hazard evaluation conducted under § 1.504(c) of the final rule, which considers factors such as those related to the harvesting and raising of the food.

15. Lot

We proposed to define “lot” as the food produced during a period of time indicated by a specific code.

(Comment 40) Several comments request that “lot” be defined by criteria other than time. Some comments assert that the proposed definition appears to ignore other factors such as common characteristics (
e.g.,
origin, variety, type of packing) and maintain that multiple lots can be produced during the same time but with different lot designations. These comments suggest that lot be defined as a body of food designated with common characteristics that is separable by such characteristics from other bodies of food. One comment asserts that growers and processors define lot differently based on their company practices and the specific characteristics of the process and product. As examples of such definitions, the comment lists the following:

• A specific planting block of specified size prepared and planted on a given day, raised with common agricultural inputs, and scheduled for harvest on a selected date.

• A quantity of finished product that passes over a processing line during a given period of time.

This comment requests that importers be permitted to independently define lot and make the definition available to FDA during an inspection.

One comment suggests that lot be defined as a batch, or a specified identified portion of a batch or, in the case of food produced by a continuous process, a specific identified amount of food produced during a specified period of time, or in a specified quantity, on a specified equipment line. This comment would define “batch” as a specific quantity of a food produced during a specified time period during a single cycle of manufacture, and it would define “code” as a unique and distin

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A2015-28158. Public record. Not legal advice.