# National Bioengineered Food Disclosure Standard > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/fr%3A2018-27283 ## Record - **Collection:** Federal Register - **Document type:** Rule - **Published:** December 21, 2018 - **Citation:** 83 FR 65814 ## Text DEPARTMENT OF AGRICULTURE Agricultural Marketing Service 7 CFR Part 66 [Doc. No. AMS-TM-17-0050] RIN 0581-AD54 National Bioengineered Food Disclosure Standard AGENCY: Agricultural Marketing Service, USDA. ACTION: Final rule. SUMMARY: This rule establishes the new national mandatory bioengineered (BE) food disclosure standard (NBFDS or Standard). The new Standard requires food manufacturers, importers, and other entities that label foods for retail sale to disclose information about BE food and BE food ingredients. This rule is intended to provide a mandatory uniform national standard for disclosure of information to consumers about the BE status of foods. Establishment and implementation of the new Standard is required by an amendment to the Agricultural Marketing Act of 1946. DATES: Effective Date: This rule becomes effective February 19, 2019. Implementation Date: January 1, 2020. Extended Implementation Date (for small food manufacturers): January 1, 2021. Voluntary Compliance Date: Ends on December 31, 2021. Mandatory Compliance Date: January 1, 2022. FOR FURTHER INFORMATION CONTACT: Arthur L. Neal, Jr, Deputy Administrator, Transportation and Marketing Program, AMS, USDA, 1400 Independence Ave. SW, Room 4543-S, Washington, DC 20250; email: Arthur.Neal@usda.gov; telephone: 202-690-1300; or fax: 202-690-0338. SUPPLEMENTARY INFORMATION: On July 29, 2016, Public Law 114-216 amended the Agricultural Marketing Act of 1946 (7 U.S.C. 1621 et seq. ), as amended (amended Act), by adding Subtitles E and F. Subtitle E of the amended Act directs the Secretary of Agriculture (Secretary) to establish the NBFDS for disclosing any food that is or may be bioengineered. 7 U.S.C. 1639b(a)(1). Subtitle E also directs the Secretary to establish requirements and procedures necessary to carry out the new Standard. 7 U.S.C. 1639b(a)(2). Outline of the Final Rule I. Introduction II. Applicability A. Definitions B. Food Subject to Disclosure C. Bioengineered Food 1. Definition of “Bioengineering” and “Bioengineered Food” 2. Conventional Breeding 3. Found in Nature D. List of Bioengineered Foods 1. List Maintenance and Revision 2. Treatment of Technologies E. Factors and Conditions 1. Incidental Additives 2. Undetectable Modified Genetic Material F. Exemptions 1. Food Served in a Restaurant or Similar Retail Food Establishment 2. Very Small Food Manufacturers 3. Threshold 4. Animals Fed With Bioengineered Feed and Their Products 5. Food Certified Under the National Organic Program G. Severability III. Disclosure A. General 1. Responsibility for Disclosure 2. International Impact 3. Appearance of Disclosure 4. Placement of Disclosure 5. How the List of Bioengineered Foods Relates to Disclosure a. Disclosure Options b. Use of the “May Be” Option B. Text Disclosure C. Symbol Disclosure D. Electronic or Digital Link Disclosure E. Study on Electronic Disclosure and a Text Message Disclosure Option F. Small Food Manufacturers 1. Definition 2. Telephone Number 3. Internet website G. Small and Very Small Packages H. Food Sold in Bulk Containers I. Voluntary Disclosure IV. Administrative Provisions A. Recordkeeping Requirements B. Enforcement C. Effective, Implementation, and Compliance Dates D. Use of Existing Label Inventories V. Comments on the NPRM VI. Rulemaking Analyses and Notices A. Paperwork Reduction Act 1. Comments on Information Collection and Recordkeeping B. E-Gov C. Civil Rights Review D. Executive Orders 12866, 13563, and 13771 E. Final Regulatory Flexibility Analysis 1. Introduction 2. Economic Effects on Small Entities 3. Definition of Small Business 4. Coordination of Definition of Small Food Manufacturers With FDA Definition 5. Exemptions for Very Small Food Manufacturers 6. Costs to Small Entities 7. Summary F. Executive Order 13175 G. Executive Order 12988 H. Executive Order 13132 I. Introduction The Secretary delegated authority for establishing and administering the NBFDS to the Agricultural Marketing Service (AMS). To assist with development of the new Standard, AMS posted 30 questions for public consideration and comment on its website ( https://www.ams.usda.gov/rules-regulations/public-input-bioengineered-food-disclosure-questions ) on June 28, 2017. Contributors from diverse backgrounds, including consumers, food manufacturers and retailers, farmers and processors, State and foreign governments, and various associations and other interested groups representing consumers and industry submitted over 112,000 responses. AMS posted the responses on its website. AMS considered responses to the 30 questions in the development of a proposed rule, which was included in a notice of proposed rulemaking (NPRM) published in the Federal Register on May 4, 2018 (83 FR 19860). The NPRM outlined AMS's proposed requirements and procedures for the new Standard to be codified at 7 CFR part 66 and requested public comment on several regulatory alternatives offered for consideration. The public comment period closed on July 3, 2018. AMS received approximately 14,000 comments by the end of the comment period. Subsequent to publication of the NPRM, AMS published two documents in the Federal Register related to this proceeding. The first, published on May 23, 2018 (83 FR 23827), announced the availability of a recorded webinar about the proposed NBFDS on AMS's website. The second, published on June 20, 2018 (83 FR 28547), made a correction to the Initial Regulatory Flexibility Analysis contained in the NPRM to clarify that the proposed rule was not expected to have a significant economic impact on a substantial number of small business entities. AMS also published two supplemental documents related to the NBFDS. One, a Regulatory Impact Analysis and its supporting documents, was posted on Regulations.gov at https://www.regulations.gov/document?D=AMS-TM-17-0050-2833 . The other, a graphic document showing alternative proposals for BE food disclosure labels, was posted on Regulations.gov at https://www.regulations.gov/document?D=AMS-TM-17-0050-0003, and on AMS's website at https://www.ams.usda.gov/sites/default/files/media/ProposedBioengineeredLabels.pdf. The amended Act directs the Secretary to conduct a study to identify potential technological challenges related to electronic or digital disclosure methods. See 7 U.S.C. 1639b(c)(1). AMS sponsored such a study, and the results were published on AMS's website ( https://www.ams.usda.gov/reports/study-electronic-or-digital-disclosure ) in September 2017. Public comments on the results of the study were solicited in conjunction with the NPRM. The Secretary's determination regarding this matter is discussed in Section III of this final rule. Finally, Subtitle F of the amended Act addresses Federal preemption of State and local genetic engineering labeling requirements. 7 U.S.C. 1639i. Subtitle F also specifies that certification of food under the U.S. Department of Agriculture's (USDA) National Organic Program (NOP) (7 CFR part 205) shall be considered sufficient to make claims about the absence of bioengineering in the food. 7 U.S.C. 6524. The purpose of the NBFDS as contained in this final rule is to provide a mandatory disclosure standard for BE food, by which uniform information is provided to consumers. Nothing in the disclosure requirements set out in this final rule conveys information about the health, safety, or environmental attributes of BE food as compared to non-BE counterparts. In fact, the regulatory oversight by USDA and other Federal Government agencies ensures that food produced through bioengineering meets all relevant Federal health, safety, and environmental standards. The agencies responsible for oversight of the products of biotechnology include: USDA's Animal and Plant Health Inspection Service (APHIS), the U.S. Environmental Protection Agency (EPA), and the Department of Health and Human Services' Food and Drug Administration (FDA). The Coordinated Framework for Regulation of Biotechnology (Coordinated Framework) is a policy framework that summarizes the roles and responsibilities of these three principal regulatory agencies with respect to regulating biotechnology products. The final rule is intended to provide for disclosure of foods that are or may be bioengineered to consumers, but also seeks to minimize implementation and compliance costs for the food industry—costs that could be passed on to all consumers. To that end, AMS has tried to craft requirements that are clear and straightforward, incorporating flexibility where appropriate. Public input has been invaluable to this effort; public comments submitted in response to the proposed rule were critical to the development of the final rule. The following discussion of the NBFDS is divided into three parts: (1) Applicability; (2) disclosure; and (3) administrative provisions. II. Applicability The amended Act directs USDA to promulgate regulations regarding foods required to bear a disclosure indicating that the food is or may be bioengineered. 7 U.S.C. 1639b(b). At the outset, the amended Act establishes the scope of the NBFDS by defining “bioengineering” and “food,” and by limiting mandatory disclosure to those foods subject to the labeling requirements of the Federal Food, Drug, and Cosmetic Act (FDCA) (21 U.S.C. 301 et seq. ) and to certain foods subject to labeling under the Federal Meat Inspection Act (FMIA)(21 U.S.C. 601 et seq. ), the Poultry Products Inspection Act (PPIA)(21 U.S.C. 451 et seq. ), or the Egg Products Inspection Act (EPIA)(21 U.S.C. 1031 et seq. ) administered by the Food Safety and Inspection Service (FSIS). 7 U.S.C. 1639 and 1639a. Definitions pertinent to the new part 66, descriptions of foods that are subject to disclosure, and explanations of applicable exemptions are included in subpart A of the new regulatory section. Section 66.3 sets forth the general requirements for disclosure. Section 66.3(a) requires that labels for bioengineered food must bear a BE disclosure consistent with the requirements of part 66. Section 66.3(a)(2) prohibits labels for food that is not bioengineered from bearing a BE disclosure unless the food may bear a voluntary disclosure under § 66.116, based on records maintained under § 66.302. A. Definitions Section 66.1 lists the definitions that apply to new part 66. For subpart A, the key terms are “bioengineered food,” “bioengineered substance,” “food,” “label,” “predominance,” “similar retail food establishment,” “very small food manufacturer,” and “List of Bioengineered Foods.” These terms are critical in determining what foods require a BE disclosure. B. Food Subject to Disclosure Whether a food is subject to the labeling requirements of the amended Act, depends as a preliminary matter on whether the product at issue is a food. The amended Act codified the definition of “food” as “a food (as defined in section 321 of title 21) that is intended for human consumption.” 1 7 U.S.C. 1639(2). The final rule adopts the same definition of “food” as used in the amended Act. 1 The original text of the amended Act referred to section 201 of the FDCA, but the reference was changed to section 321 of title 21 in the codification of the statute. The FDCA defines “food” as “. . . (1) articles used for food or drink for man or other animals, (2) chewing gum, and (3) articles used for components of any such article.” 21 U.S.C. 321(f). Ultimately, FDA has jurisdiction over the FDCA and has the authority to determine what is considered “food” under the FDCA. AMS has deferred to FDA in interpreting the definition of “food.” However, the amended Act limits the definition of food for purposes of the NBFDS to articles used for human consumption and does not include articles used for animals. Therefore, although pet food and animal feed are “food” under the FDCA, such foods for animals are not covered by this regulation, pursuant to the amended Act. Chewing gum is considered to be “intended for human consumption,” and is therefore considered a “food” for the purpose of the NBFDS. Under the FDCA, the definition of “food” includes both articles used for food or drink and articles used for components of any such article. For instance, a raw agricultural commodity such as an apple constitutes food under FDCA. A processed item like a soup with the following ingredients—water, broccoli, vegetable oil, modified food starch, and wheat flour—is also a food, as are each of those ingredients. Other examples of “food” under the FDCA include dietary supplements, processing aids, and enzymes. Not all food within the FDCA's definition falls within the scope of the NBFDS. The amended Act limits the disclosure to (1) food that is subject to the labeling requirements of the FDCA; or (2) food that is subject to the requirements of the three FSIS statutes previously mentioned, with certain exceptions. See 7 U.S.C. 1639a. As for the FDCA, which is under FDA jurisdiction, the NBFDS applies to all foods subject to its labeling requirements, including but not limited to raw produce, seafood, dietary supplements, and most prepared foods, such as breads, cereals, non-meat canned and frozen foods, snacks, desserts, and drinks. Distilled spirits, wines, or malt beverages as defined by the Federal Alcohol Administration Act (FAA Act) are foods under the FDCA but are not subject to the NBFDS because they are subject to the labeling provisions of the FAA Act rather than the labeling requirements of the FDCA. Alcoholic beverages not subject to the labeling provisions of the FAA Act, such as wines with less than seven percent alcohol by volume and beers brewed without malted barley and hops, would be subject to the NBFDS. The amended Act also specifies that the NBFDS only applies to foods subject to the labeling requirements of the three FSIS statutes if the most predominant ingredient of the food would independently be subject to the labeling requirements under the FDCA; or if the most predominant ingredient of the food is broth, stock, water, or a similar solution and the second-most predominant ingredient of the food would independently be subject to the labeling requirements under the FDCA. See 7 U.S.C. 1639a(c)(2). FDA's method of determining predominance relies on weight of the ingredients, as does FSIS's. The NBFDS uses the same methods FDA uses to determine predominance at 21 CFR 101.4(a)(1), which provides that ingredients required to be declared on the label or labeling of a food, including foods that comply with standards of identity, except those ingredients exempted by § 101.100, shall be listed by common or usual name in descending order of predominance by weight on either the principal display panel or the information panel in accordance with the provisions of § 101.2. Thus, a multi-ingredient food product that contains meat, poultry, or egg product (including beef broth, if identified as a composite ingredient), subject to the FMIA, the PPIA, or the EPIA, respectively, as the first ingredient of the ingredient list on the food label would not be subject to the NBFDS, per the amended Act. A multi-ingredient food product that contains broth, stock, water, or similar solution as the first ingredient, and a meat, poultry, or egg product as the second ingredient on the food label would also not be subject to the NBFDS. For example, a canned stew where pork is the primary ingredient followed by other ingredients such as sweet corn, would not be subject to the NBFDS. The corn may be bioengineered, but pork, which is subject to the labeling requirements of the FMIA, is the predominant ingredient, so the canned stew product is not subject to the NBFDS, per the amended Act. If, however, a meat, poultry, or egg product is the third most predominant ingredient or lower, the food would be subject to the NBFDS. For example, a soup with the following ingredient list—broth, carrots, chicken, etc., would be subject to disclosure under the NBFDS, and the analysis as to whether it would be considered a “bioengineered food” subject to the NBFDS's disclosure requirements would continue. Seafood, except Siluriformes (catfishes), and meats such as venison and rabbit are subject to the FDCA (but not the Federal Meat Inspection Act). Thus, a multi-ingredient food product that contains one of these as the first ingredient would be subject to the NBFDS. A multi-ingredient product that contained one of these as the second most predominant ingredient or lower, could also require disclosure, unless the product is otherwise exempt (for example, due to the predominance of another ingredient such as chicken or beef, as described above). C. Bioengineered Food The amended Act delegates authority to the Secretary to establish the NBFDS regarding “bioengineered food.” 7 U.S.C. 1639b(a). This authority includes the ability to define “bioengineered food,” consistent with the statutory provisions that address this term. The amended Act also authorizes the Secretary to determine other terms that are similar to “bioengineering.” 7 U.S.C. 1639(1). 1. Definition of “Bioengineering” and “Bioengineered Food” The amended Act defines “bioengineering” with respect to a food as referring to a food “(A) that contains genetic material that has been modified through in vitro recombinant deoxyribonucleic acid (DNA) techniques; and (B) for which the modification could not otherwise be obtained through conventional breeding or found in nature.” 7 U.S.C. 1639(1). In accordance with its statutory mandate and for purposes of consistency, AMS is directly incorporating this statutory definition into the definition of “bioengineered food”. The NPRM invited public comment on two different interpretations of the statutory definition of “bioengineering” and on the scope of the regulatory definition of “bioengineered food.” Specifically, comments were solicited on whether refined foods and ingredients should be subject to disclosure under the NBFDS. The first interpretation, identified as Position 1 in the NPRM, stated that refined products do not “contain genetic material that has been modified through in vitro recombinant deoxyribonucleic acid (DNA) techniques” because the refining process rendered genetic material undetectable using common testing methods. The second interpretation, identified as Position 2 in the NPRM, stated that the scope of the definition of “bioengineering” applies to all foods produced from bioengineering, such as refined products. AMS adopts Position 1 with some modifications. The statutory definition of “bioengineering” makes clear that food must “contain[ ] genetic material that has been modified through in vitro recombinant deoxyribonucleic acid (DNA) techniques . . .” to be labeled as a “bioengineered food.” AMS believes that the definition of “bioengineering” sets forth the scope of the mandatory disclosure and, therefore, is incorporated into the definition of “bioengineered food.” A commenter suggested that AMS adopt a definition of “highly refined” if it adopts Position 1. We did not do so because the final rule does not use that term. AMS has chosen to adopt the definition of “bioengineered food” that hews closely to the plain language of the amended Act. This definition references § 66.9 to explain how a regulated entity may demonstrate that a food, including a refined food ingredient, does not contain detectable modified genetic material. AMS has revised the proposed definition of “bioengineered food” to reflect its interpretation of the amended Act that foods with undetectable modified genetic material are not bioengineered foods. Whether a food or food ingredient contains modified genetic material may vary depending on the refining process used to produce the food. For refined foods that are derived from bioengineered crops, no disclosure is required if the food does not contain detectable modified genetic material. Commenters discussed how testing might be used to detect the presence of modified genetic material in a food. Some commenters stated that testing for modified genetic material would be difficult to enforce, expensive, and present barriers to international trade. These commenters stated that regulated entities may choose to make a BE disclosure rather than conduct testing, thereby resulting in different labels for similar food products. Other commenters supported the use of testing to determine detectability and offered ideas regarding testing methods and standards to determine the presence or absence of detectable modified genetic material. A few commenters asked AMS to establish minimal standards regarding the analytical tools used for detecting, identifying, and quantifying modified genetic material. Some commenters also urged AMS to update the NBFDS as scientific detection methods evolve, and a few further recommended that AMS maintain publicly available guidance documents or lists of scientifically validated genetic testing methods to ensure testing consistency in the marketplace. AMS acknowledges there are multiple ways to determine whether a food or ingredient contains detectable modified genetic material. Because the amended Act authorizes examinations, audits, and similar activities with respect to records for enforcement of the NBFDS (7 U.S.C. 1639b(g)(2)-(3)), AMS added provisions in § 66.9 that describe how regulated entities can use records to demonstrate that modified genetic material is not detectable. Regulated entities are in the best position to know about the products they are sourcing and the refinement processes they have undergone. An entity's records, therefore, can be used to demonstrate that modified genetic material is not detectable. First, as provided in § 66.9(a)(1), regulated entities can demonstrate that modified genetic material is not detectable with records verifying that the food is sourced from a non-bioengineered crop or other food source, such as non-bioengineered salmon. Second, as provided in § 66.9(a)(2), regulated entities can demonstrate that modified genetic material is not detectable in the food with records verifying that the food has been subjected to a refinement process “validated” to render modified genetic material undetectable. Process validation for the purposes of the NBFDS can be achieved through laboratory testing, as provided in § 66.9(b). Commenters stated that modified genetic material is undetectable when bioengineered crops are refined or processed under certain conditions. Commenters described the food refining and manufacturing process and explained the rigorous quality controls necessary to meet modern customer demands. Based on this information, AMS believes that once a refiner's process has been validated by testing to render modified genetic material undetectable, foods subjected to the same process in a defined, controlled, documented, and repeated way will also have no detectable modified genetic material. Regulated entities that produce or use refined foods may rely on processing records alone to prove the absence of detectable modified genetic material. In other words, foods subjected to the validated refining process would not require additional laboratory testing to prove the lack of modified genetic material. To comply with NBFDS requirements, regulated entities can maintain records to verify the foods they use have been subjected to refining processes that have been validated to render modified genetic material undetectable. Such records may include customary processing records maintained in the normal course of business, as well as copies of the most recent analytical testing results used to validate the refining process. Section 66.9(c) provides standards of performance for analytical testing to validate that foods subjected to specific refining processes contain no detectable modified genetic material. Third, as provided in § 66.9(a)(3), regulated entities can demonstrate that modified genetic material is not detectable by maintaining certificates of analysis or other testing records appropriate to the specific food tested which confirm the absence of modified genetic material. As mentioned above and provided in § 66.9(c), AMS established performance standards related to detectability analyses for the purposes of the NBFDS. AMS recognizes that some regulated entities may wish to disclose that their processed food is derived from a bioengineered source even when modified genetic material is not detectable in the food. In addition to the authority to establish the mandatory disclosure Standard, the amended Act at 7 U.S.C. 1639b(a)(2) grants the Secretary the authority to establish other requirements that are necessary to carry out the Standard. AMS has determined, based on numerous comments, that it is necessary for the Standard to include the ability for regulated entities to disclose voluntarily that their processed food was made with ingredients derived from a bioengineered source to provide a mechanism for regulated entities to provide information to consumers. This provision is discussed in more detail Section III.I.—Voluntary Disclosure, below. 2. Conventional Breeding AMS did not include a proposed definition of “conventional breeding,” a component term of the definition of “bioengineering.” The NPRM solicited comments on whether such a definition should be included in the NBFDS, and if so, what it should be. Many commenters recommended that AMS define “conventional breeding” within the NBFDS final rule, to better define the scope of NBFDS for regulated entities and consumers. Several commenters suggested various definitions, including adopting the definition used by FDA or from the Codex Alimentarius. Several commenters stated that the term “conventional breeding” is commonly understood in the industry and, therefore, does not need to be defined. Some of those commenters who did not support defining the term argued that any such attempts would be inherently confusing or misleading to consumers. AMS finds no compelling reason to adopt a definition of “conventional breeding” at this time and agrees with commenters who advised not defining the term. AMS finds that “conventional breeding” is a commonly understood term within industry and does not need to be defined. As techniques and technology evolve, any definition today could become unworkable or obsolete because it does not and could not anticipate those advancements. Foregoing defining the term allows AMS to respond to those challenges in real time. 3. Found in Nature AMS did not include a proposed definition of “found in nature,” another component term of the definition of “bioengineering.” The NPRM solicited comments on whether such a definition should be included in the NBFDS, and if so, what it should be. The NPRM specifically requested comments on whether protections under intellectual property law might be considered when determining whether a genetic modification could be found in nature. Comments were also sought on other possible methods for determining whether a genetic modification could be “found in nature.” Commenters generally did not support defining or including the term “found in nature” within the NBFDS. Many of those in opposition believed the term “found in nature” itself was nebulous, misleading, and not adequately defined by science. Others argued that agriculture is inherently separate from nature. Of those that did request the term be defined, two common suggestions were “spontaneously occurs in nature, such as natural biological evolution, and does not overcome natural physiological reproductive or combination barriers,” or “the kinds of genetic modifications which can occur in nature within the genome of an organism, without human intervention.” One commenter was concerned that if definitions are deemed necessary, the definitions avoid setting precedents in other regulatory areas, and be kept as simple and as clear as possible. Another group of commenters stated that “this should be done through a supplemental proposed rule that provides the public with an additional opportunity to provide public comments.” Commenters mostly rejected the idea of using intellectual property law as a method of determination. Some of the objections were that it would add more complexity to the NBFDS without any additional clarity; could create unintended disincentives towards development of non-BE foods; or is outside the scope of the NBFDS. One commenter supported the consideration of intellectual property law “when appropriate, as one non-dispositive factor among others in making a determination.” Another stated that the absence of a patent should not be a factor in determining if a modification can be found in nature, since it is not required to seek patents on BE food. AMS finds it unnecessary to define the term “found in nature.” AMS received no compelling arguments to define the term and believes that attempting to do so may cause confusion in light of the rapid pace of innovation. In addition, there was little support for relying on intellectual property law to inform decisions about whether specific modifications “could not otherwise be found in nature.” In order to incorporate technological changes in industry into this mandatory labeling standard, AMS believes it needs to retain maximum flexibility. That will not be accomplished by narrowly defining “found in nature.” D. List of Bioengineered Foods AMS has developed the List of Bioengineered Foods (List) to identify the crops or foods that are available in a bioengineered form, and to aid regulated entities considering whether they may need to make a BE disclosure. The List is provided in § 66.6 of the Standard. As will be discussed later in Section III—Disclosure, a regulated entity's records will determine whether disclosure for that food is required under the NBFDS. The List includes bioengineered foods for human consumption that may be produced anywhere in the world. But the List should not be considered exhaustive, as new BE products continue to be developed. Even if a food is not on the List, regulated entities that have actual knowledge that a food they are selling is bioengineered, as defined in § 66.1, must make appropriate disclosure of that food. The List will be maintained and updated as described later in this section. The List of Bioengineered Foods replaces the two lists of commercially available bioengineered foods in the United States that AMS proposed in the NPRM. AMS proposed in the NPRM maintaining lists of “highly adopted” and “non-highly adopted” BE foods based on U.S. planted crop acreage. While some commenters agreed that the lists might simplify compliance with the NBFDS, many recommended consolidating the two lists into one and expanding the consolidated list to include bioengineered foods produced in other countries to provide a more complete picture of the variety of foods produced through bioengineering. Commenters argued against equating U.S. planted acreage with human food production and commercial availability in the United States, explaining that a large percentage of highly adopted bioengineered crops are used for animal feed, and that U.S. planted acreage does not necessarily reflect the prevalence of bioengineered foods available on the market. Commenters further argued that commercial availability should not be a basis for regulation, because that attribute is not specified in the definition of BE food, and because commercial availability can vary from country to country, depending on how foods are approved for use. For simplicity, AMS consolidated the two lists into one and expanded the consolidated List to include bioengineered crops and foods that may be produced in other countries. The List makes no presumptions about market share represented by bioengineered versions of those crops and foods in the United States. It merely provides information about what bioengineered crops and foods (including ingredients made from such foods), that meet the definition of “bioengineered food”, could be offered for retail sale in the United States, based on information available to AMS. A crop or food may be included on the List, but not require disclosure under the NBFDS. For instance, not all apple varieties are bioengineered. Non-bioengineered apples would not require disclosure. As noted elsewhere, the amended Act requires each person subject to mandatory BE food disclosure under the NBFDS to maintain records such as the Secretary determines to be customary or reasonable in the food industry to establish compliance with the Standard. See 7 U.S.C. 1639b(g)(2). The List establishes the need for recordkeeping by regulated entities who are using or selling the crops and foods on the List. Further, the List will aid regulated entities in deciding whether they may need to make a BE disclosure. Options for disclosure related to a regulated entity's records about foods on the List are described in Section III.A.5 and IV.A of this document. To compile the lists that were proposed in the NPRM, AMS considered data published by the International Service for the Acquisition of Agri-biotech Applications (ISAAA), 2 FDA's list of Biotechnology Consultations on Food from GE Plant Varieties (Consultations), and information published by USDA's Economic Research Service (ERS). 3 AMS also considered input from industry stakeholders and consumers about which foods should be considered bioengineered and require disclosure labeling. Some commenters in response to the NPRM recommended that ISAAA be the sole source for information on international BE foods and the modifications that have been made to them. Some commenters said that foods should be added to the list as soon as any one of FDA's consultation processes are completed for that food. Other commenters suggested that additional sources of data on BE foods, such as Statistics Canada, 4 should be considered, given the frequent exchange of foods between Canada and the U.S. 2 ISAAA (2016), Global Status of Commercialized Biotech/GM Crops: 2016. ISAAA Brief No. 52. ISAAA: Ithaca, NY. http://www.isaaa.org/resources/publications/briefs/52/default.asp, accessed February 5, 2018. 3 Economic Research Service (2017), Genetically engineered varieties of corn, upland cotton, and soybeans, by state and for the United States, 2000-17, Adoption of Genetically Engineered Crops in the U.S., https://www.ers.usda.gov/data-products/adoption-of-genetically-engineered-crops-in-the-us.aspx, accessed February 5, 2018. 4 Statistics Canada, https://www.statcan.gc.ca/eng/start, accessed July 26, 2018. Each of the recommended sources assists in the development and maintenance of the List; the List should represent a composite of information gathered from many sources. However, to be consistent in determining what crops or foods should be on the List, AMS has determined that the foods included on the initial List of Bioengineered Foods must meet the following criteria: (1) They are authorized for commercial production somewhere in the world, and (2) they are reported to be in legal commercial production for human food somewhere in the world. AMS relied on resources such as USDA reports and databases, and ISAAA reports and databases, 5 to determine what crops and foods currently meet those criteria. The List attempts to capture any BE crops or foods that meet the statutory definition of “bioengineering,” based on existing technology, and that could potentially be offered for sale in the United States. AMS recognizes that there are other bioengineered foods that meet one of the criteria for list inclusion, but not both. For example, bioengineered rice has been authorized for production and use as food in several countries, but AMS finds no evidence that it is currently in legal commercial production anywhere. Foods such as BE rice could be added to the List through the update process described below when available information suggests that it would be appropriate to do so. 5 ISAAA GM Approval Database: http://www.isaaa.org/gmapprovaldatabase/. Accessed August 10, 2018. The considerations described above and the NBFDS definition for “bioengineered food” will be used to determine what foods would be added to or removed from the List moving forward. (See the Treatment of Technologies section, below.) Section 66.1 of the NBFDS defines the List of Bioengineered Foods as a list maintained and updated by AMS of foods for which bioengineered versions have been developed. In the NPRM, AMS proposed to describe the initial List in the preamble to the final rule and to update the List by notice in the Federal Register with the opportunity for public comment. Given the impact of including foods on the List, we have determined that it is appropriate to incorporate the foods on the List in the final rule text to provide greater transparency. Further, AMS will update the List through rulemaking. Information and data to support inclusion of each crop or food on the List come from a variety of reliable sources, including industry reports and academic and government sources. In some cases, the listed crop or food itself may not typically be considered human food, but it may be the source from which human food is made. For example, products made from field corn, such as grits, corn chips, corn tortillas, and corn cereal are human foods and may be subject to disclosure if they meet the definition of bioengineered food. The following foods comprise the List of Bioengineered Foods: alfalfa, apple (Arctic TM varieties), canola, corn, cotton, eggplant (BARI Bt Begun varieties), papaya (ringspot virus-resistant varieties), pineapple (pink flesh), potato, salmon (AquAdvantage®), soybean, squash (summer), and sugarbeet. Where practical, the List includes specific information about individual crops and foods, such as descriptions or trade names, to help distinguish bioengineered versions of those foods from their non-bioengineered counterparts, as requested by commenters. This specificity is intended to identify foods for which disclosure may be necessary, based on the regulated entities' records. For instance, although apples are on the List, most apple varieties are not known to be bioengineered. The List is narrowed by identifying the specific apples that are known to be bioengineered. As other BE versions of the listed foods are authorized and become legally available, AMS will revise such listings to be more generic during the annual update process. Regulated entities may refer to the AMS website to obtain additional information regarding the associated bioengineered events for crops or foods they are sourcing and determine whether they need to make a disclosure. In some cases, trade names or other information may be provided to further simplify the identification and determination process for regulated entities. As well, information on the website may provide consumers additional details about traits ( e.g., non-browning, pesticide resistance, virus resistance, enhanced growth, etc.) for which the foods have been bioengineered. Providing this detailed information is intended to help reduce burdens for regulated entities by narrowing the list of varieties of each food that may be bioengineered. 1. List Maintenance and Revision AMS proposed in the NPRM that the List be subject to review and update on an annual basis, allowing for public input into the process. AMS also proposed an 18-month compliance period following List updates to allow for food label revisions in response. Such a schedule was proposed to minimize the frequency with which regulated entities would be required to update food labels, if, for instance, new BE foods were added to the List. Some commenters urged AMS to revise the List more frequently to avoid delay providing current information to consumers. Others suggested updates should occur less frequently than proposed to minimize the impact on small businesses that might have to change labels accordingly. Some commenters asked that the compliance period for revising labels be shortened, and others asked that it be extended. The NPRM described a process to update the List on an annual basis. The final rule adopts that process, except that AMS will also initiate rulemaking to amend the List as appropriate. As described in § 66.7(a), AMS will announce the annual review through the Federal Register and on the AMS website. Interested parties may submit recommendations about foods that could be added to or deleted from the List at any time, including in response to the request for recommendations that accompanies the review notice. Recommendations should include data or other information to support those recommendations. AMS will publish any recommendations, along with supporting information, on its website and request comments on the recommendations. Following a review of available information, including consultation with Federal Government agencies that comprise the Coordinated Framework or any successor body, AMS will make a determination on whether to initiate rulemaking to amend the List. Section 66.7(b) provides an 18-month compliance period from the effective date of any revision to the List to allow regulated entities time to revise existing food labels if needed. While the List of Bioengineered Foods identifies the foods for which regulated entities must maintain records and that may be required to bear a BE disclosure, the List and the records kept do not alleviate a regulated entity's responsibility for disclosure when the entity has actual knowledge that its food is a BE food. Under § 66.109, a regulated entity with actual knowledge that it is using BE food is responsible for disclosing BE foods, even if the food is not listed on the List of Bioengineered Foods. This section does not require regulated entities to seek out that information, but they also cannot ignore or be willfully blind to information that the food they are sourcing is in fact bioengineered. 2. Treatment of Technologies Technologies continue to evolve, and food produced through a specific technology may or may not meet the definition of BE food. Respondents to the 30 questions urged AMS to determine whether foods developed through certain emerging technologies would be within the scope of the definition of BE food. However, AMS proposed in the NPRM that the products of technology, rather than solely the technology itself, should be evaluated to determine whether a food meets the BE food definition and might require disclosure. AMS proposed to provide for the consideration of new technologies used to develop foods during the process of reviewing and revising the List pursuant to § 66.7(a). AMS proposed to do so through consultation with the U.S. Government agencies responsible for oversight of the products of biotechnology—USDA-APHIS, EPA, FDA, and appropriate members of the Coordinated Framework for the Regulation of Biotechnology. In that way, AMS could understand whether foods resulting from new technologies would meet the definition of “bioengineered food” and should be added to the List. Conversely, foods may be removed from the List if they are no longer produced from a technology that meets the definition of “bioengineered food.” In other cases, some varieties may meet the definition, while others do not. Comments in response to the NPRM ranged from those commenters who urged that the scope of the NBFDS should reflect the use of all current and emerging technologies to those who argued that some new genetic engineering techniques would fall outside the scope of the statutory definition. AMS continues to believe that determinations about what constitutes BE food for the purposes of the NBFDS should focus primarily on the characteristics of foods that have been produced using bioengineering as defined in the amended Act, and whether such foods meet the definition of “bioengineered food.” Thus, as proposed, the products of new technologies will be considered during reviews and updates of the List of Bioengineered Foods. E. Factors and Conditions As described in the proposed rule, in promulgating a regulation to carry out the Standard, the amended Act directs the Secretary to establish a process for requesting and granting a determination by the Secretary regarding other factors and conditions under which a food is considered a BE food. 7 U.S.C. 1639b(b)(2)(C). The amended Act does not specify the process by which the Secretary will determine other factors and conditions under which a food is considered a BE food; rather, it provides the Secretary with discretion in setting up such a process. Commenters were generally supportive of the proposed process for adopting factors or conditions under which a food is considered a BE food, and AMS is adopting the proposed process described in the NPRM. Subpart C describes the process by which people can submit a request or petition for a determination regarding other factors or conditions. The acceptance of a request or petition for determination regarding a factor or condition would then culminate in rulemaking to incorporate the factor or condition into the “bioengineered food” definition. Rulemaking allows for transparency and public participation in determining whether or not the definition of “bioengineered food” should be amended. Ultimately, the impact of adopting the proposed factors or conditions (as follows) would be to limit the scope of the definition of “bioengineered food,” thus potentially excluding certain products from disclosure. Under § 66.200, the determination process begins with the submission of a request or petition for determination regarding other factors and conditions under which a food is considered a BE food in accordance with § 66.204. Section 66.204 describes the process for submitting a request or petition, including where to send the submission. The submission needs to include a description and analysis of the requested new factor or condition and any supporting documents or data. Section 66.204 describes how to properly mark confidential business information that may be included to support the request, to ensure its confidentiality. Finally, § 66.204 instructs that the submission must explain how the standards for consideration apply to the requested factor or condition. Section 66.202 describes the standards for consideration by which the Secretary's designee, the AMS Administrator, would evaluate the request or petition. Given the existing statutory definition of “bioengineering,” the first standard, in paragraph (a), requires the requested factor or condition to be within the scope of the definition of “bioengineering” in 7 U.S.C. 1639(1). The second standard, in paragraph (b), requires the Administrator to evaluate the cost of implementation and compliance. In applying this second standard, the Administrator will evaluate the cost related to the factor or condition, the difficulty for affected regulated entities to implement the factor or condition, especially small businesses, and the difficulty AMS would have in monitoring compliance with the factor or condition. Paragraph (c) allows the Administrator to consider other relevant information as part of the evaluation. Relevant information for a particular proposed factor or condition will include its compatibility with the food labeling requirements of other Federal agencies or foreign governments. In determining compatibility with other requirements, AMS will consult with the U.S. Government agencies responsible for oversight of the products of biotechnology: USDA-APHIS, EPA, and FDA. Such information may allow AMS to align the NBFDS with the standards of other Federal agencies or foreign governments, which may facilitate interstate commerce and trade by allowing for recognition of compatible standards. The Administrator will also consult with the United States Trade Representative (USTR) and the Department of State to ensure the request or petition regarding other factors and conditions related to BE disclosure requirements results in implementation in a manner consistent with international trade obligations as mandated by 7 U.S.C. 1639c(a). If the Administrator determines that the request or petition satisfies the standards for consideration, AMS will initiate rulemaking that seeks to amend the definition of “bioengineered food” in § 66.1 to include the factor or condition. Some commenters asked AMS to clarify in the final rule the parameters for submitting petitions to adopt factors or conditions. A few commenters asked AMS to establish a specific time period within which the agency would respond to requests for adoption of factors or conditions, as well as a time period for regulated entities to attain compliance with adopted factors or conditions. AMS has made no changes to the submission parameters in connection with requests or petition for factors and conditions, as we believe they are clear and transparent. AMS has not established a time period within which the agency will respond to requests for adoption of factors or conditions because such responses will vary depending on agency resources, the complexity of the submitted request for adoption of factors or conditions, and the nature of implementing regulation. Similarly, AMS has not provided a time period for regulated entities to attain compliance with adopted factors and conditions in subpart C, as adopted factors and conditions act as carve outs from the statutory definition of bioengineering such that compliance with the adopted factor or condition should not be burdensome. To the extent that the adopted factors or conditions would be burdensome or require additional time for compliance, AMS would address any compliance period in future rulemakings considering the specific adopted factors and conditions. In the NPRM, AMS proposed two submitted requests for factors and conditions under which a food is considered a BE food. Those requests involved (1) whether incidental additives present in food should be considered “bioengineered food” and labeled accordingly; and (2) whether the modified genetic material in a refined food may be detected. The impact of adopting these factors or conditions will be to limit the scope of the definition of “bioengineered food,” thus potentially excluding certain products from disclosure. 1. Incidental Additives The first factor or condition concerns a BE food that is an incidental additive. As described in 21 CFR 101.100(a)(3), incidental additives that are present in food at an insignificant level and do not have any technical or functional effect in the food are exempt from certain labeling requirements under the FDCA. Commenters in response to AMS's 30 questions requested that incidental additives not be subject to disclosure under the proposed NBFDS because they are exempt from inclusion in the ingredient statement on a food label, according to 21 CFR 101.100(a)(3). AMS is aware that an ingredient that is required to be listed in the ingredient list in one product may be used in another product as an incidental additive that is not required to be included in the ingredient list. Under this factor or condition, such an item will only trigger disclosure when it is used as an ingredient that is included on the ingredient list, not when used as an incidental additive. Application of this factor or condition falls within the scope of the definition of “bioengineering” in 7 U.S.C. 1639(1), and thus meets the first standard for consideration. This factor or condition will also satisfy the second standard for consideration—cost of implementation and compliance. Aligning the disclosure requirements of the NBFDS with the ingredient declaration requirements under applicable FDA regulations will simplify compliance and reduce labeling costs for regulated entities. Finally, AMS finds it relevant that adoption of this factor or condition would be compatible with the food labeling requirements of other Federal agencies and some foreign governments. The impact of adopting this proposed factor or condition as not being within the definition of “bioengineered food” is to exclude certain incidental additives from disclosure. Based on public comments on the 30 questions and the NPRM, AMS believes adopting this factor or condition may exempt a number of enzymes that are currently used in food production but not currently listed in the ingredient statement on a food label. However, based on those same comments, AMS is aware that some enzymes may be used in a manner that requires them to be labeled on the ingredient statement. In the NPRM, AMS sought comment on whether, more generally, enzymes present in food should be considered “bioengineered food.” AMS has made no changes to this factor and condition regarding incidental additives under which products can be excluded from disclosure. The amended Act provides the Secretary with authority to limit disclosure in certain circumstances. The factors and conditions process offers a fair and rational method by which to consider various proposals. For the reasons mentioned, AMS believes that exempting incidental additives from BE disclosure that are not required to be labeled per FDCA regulations is sensible, in alignment with the labeling requirements of other trading partners and will limit the burden on regulated entities without unduly limiting disclosure for consumers. Some commenters sought modifications to the text of this provision clarifying what “insignificant” means or clarifying the types of incidental additives that are not subject to disclosure. AMS does not believe such clarification is necessary. The provision references the FDA regulations that AMS relied upon in drafting the provision. That FDA regulation describes the circumstances in which incidental additives are not labeled as an ingredient. Title 21 CFR 101.100(a)(3) provides an exemption for incidental additives that are present in a food at insignificant levels and do not have any technical or functional effect in that food. For the purposes of § 101.100(a)(3), incidental additives are: • Substances that have no technical or functional effect but are present in a food by reason of having been incorporated into the food as an ingredient of another food, in which the substance did have a functional or technical effect. • Processing aids, which are as follows: ○ Substances that are added to a food during the processing of such food but are removed in some manner from the food before it is packaged in its finished form. ○ Substances that are added to a food during processing, are converted into constituents normally present in the food, and do not significantly increase the amount of the constituents naturally found in the food. ○ Substances that are added to a food for their technical or functional effect in the processing but are present in the finished food at insignificant levels and do not have any technical or functional effect in that food. • Substances migrating to food from equipment or packaging or otherwise affecting food that are not food additives as defined in section 201(s) of the act; or if they are food additives as so defined, they are used in conformity with regulations established pursuant to section 409 of the act. Section 101.100(a)(3)(i), (ii), and (iii) provide a list of incidental additives that are not required to be labeled under FDA regulations and by extension are not required to be disclosed as BE foods. AMS believes that the cross-reference to the FDA regulations is clear. With respect to treatment of yeasts, enzymes, or any other microorganisms, AMS agrees that if they qualify as incidental additives that are not required to be labeled as ingredients on a food label, then they do not require disclosure as BE foods. However, bioengineered yeasts, enzymes, and other organisms that do not qualify as incidental additives that are not required to be labeled as ingredients may require disclosure as BE foods unless they meet the requirements of another provision (for instance, by establishing that their modified genetic material is not detectable). AMS cannot make a categorical exemption for microorganisms in this final rule; however, such an exemption is possible through the factors and conditions process in future rulemakings. 2. Undetectable Modified Genetic Material The NPRM also sought comment on another proposed factor and condition—excluding food from the disclosure standard where the modified genetic material in the food cannot be detected. As the NPRM noted, if AMS ultimately proceeded with Position 2 and presumed that refined ingredients are bioengineered foods, this factor or condition, if adopted, would be a means to potentially exclude products where modified genetic material cannot be detected. As discussed above, AMS did not adopt Position 2, so this factor or condition is not incorporated into the final rule. The definition of “bioengineered food” in the final rule already excludes foods where modified genetic material is not detectable. F. Exemptions The amended Act includes two express exemptions to the disclosure requirement: For food served in a restaurant or similar retail food establishment and for very small food manufacturers. 7 U.S.C. 1639b(b)(2)(G). The amended Act also authorizes the Secretary to “determine the amounts of a bioengineered substance that may be present in food, as appropriate, in order for the food to be a bioengineered food.” 7 U.S.C. 1639b(b)(2)(B). As well, the amended Act prohibits food derived from an animal to be considered a BE food solely because the animal consumed feed produced from, containing, or consisting of a bioengineered substance. 7 U.S.C. 1639b(b)(2)(A). Finally, Subtitle F specifies that the certification of food under USDA's National Organic Program (7 CFR part 205) shall be considered sufficient to make claims about the absence of bioengineering in the food. 7 U.S.C. 6524. Section 66.5 incorporates each of these as regulatory exemptions in the NBFDS. 1. Food Served in a Restaurant or Similar Retail Food Establishment Section 66.5(a) exempts food served in a restaurant or similar retail food establishment from disclosure under the NBFDS. In the NPRM, § 66.1 defined “similar retail food establishment” as a cafeteria, lunch room, food stand, saloon, tavern, bar, lounge, other similar establishment operated as an enterprise engaged in the business of selling prepared food to the public, or salad bars, delicatessens, and other food enterprises located within retail establishments that provide ready-to-eat foods that are consumed either on or outside the retailer's premises. This definition is consistent with the definition of “food service establishment” included in other labeling programs authorized by the amended Act. See 7 U.S.C. 1638(3) and the regulations at 7 CFR 60.107 and 7 CFR 65.140, with minor modifications. The NPRM solicited comments on the scope of this definition. Some commenters stated that restaurants should not be exempt from the NBFDS because it would undermine the transparency and consistency important to consumers who want to know the origins of their food. Other commenters supported the exemption generally and AMS's proposed definition. Other commenters stated that AMS's proposed definition was too narrow and should include a list of places as examples, rather than an exclusive list, such as cafeteria, lunch room, food stand, food truck, saloon, tavern, bar, lounge, salad bar, delicatessen, entertainment venue, or other retail business establishment where meals or refreshments constituting food may be purchased. One commenter requested that transportation carriers be added to the list of places exempted from the NBFDS. Another commenter stated that all foods prepared, processed, or packaged in the retail food establishment, including those utilizing “central kitchen” locations for certain prepared foods, should be exempt from the disclosure requirement and that the term “packaged” should conform to 21 CFR 1.20, FDA's general food labeling requirements. Based on the comments received, AMS has modified the definition of “similar retail food establishment” to add additional examples, including food truck and transportation carrier. AMS considered including a list of places as examples, rather than an exhaustive list, but believes that the reference to “other similar establishment operated as an enterprise engaged in the business of selling prepared food to the public” should capture any additional places that are not specifically listed. To clearly address a point of confusion observed in the comments received, AMS is clarifying that salads, soups, and other ready-to-eat items prepared by grocery stores are exempt from the disclosure requirements. AMS has not modified the definition to state “where meals or refreshments constituting food may be purchased,” as we believe that with this insertion the exemption would be much broader than the plain meaning of the amended Act. AMS believes that the exemption is intended to cover ready-to-eat or prepared foods. To extend the exemption to all foods prepared, processed, or packaged in a retail food establishment, which would include bulk foods such as granola or apples in a bin, would conflict with the requirement that foods subject to FDCA's labeling requirements are subject to disclosure. The modified definition provides clarity and flexibility to regulated entities and is in accordance with the plain language of the amended Act. 2. Very Small Food Manufacturers Section 66.5(b) exempts very small food manufacturers from the disclosure requirement of the NBFDS. Section 66.1 defines “very small food manufacturer” as a food manufacturer with annual receipts of less than $2.5 million. To develop this definition, AMS considered FDA's exemptions or special labeling requirements for certain food if the food is offered for sale by certain persons who have annual gross sales made or business done in sales to consumers that are not more than $500,000 under certain conditions (see 21 CFR 101.9(j)(1)(i) and 101.36(h)(1)) and U.S. Census Bureau (USCB) regulations. AMS evaluated the impact of applying various definitions of “very small food manufacturer” by estimating the number of firms that would be exempted, the number of products that would likely be exempt, and the proportion of annual industry sales that would be exempt under each exemption level. The NPRM included the following tables showing the cumulative percentage of firms, products (UPCs), and sales that would be exempt if the definition of “very small food manufacturer” were set at the top of each of the annual revenue ranges (based on USCB's 2012 Statistics of U.S. Businesses ). Food Manufacturers Establishment receipts threshold (in $) Cumulative percent of firms exempt (%) Cumulative percent of products exempt (%) Cumulative percent of sales exempt (%) <100,000 20 0 0 100,000-499,999 45 1 0 500,000-999,999 58 2 1 1,000,000-2,499,999 74 4 1 2,500,000-4,999,999 81 6 2 5,000,000-7,499,999 84 7 3 7,500,000-9,999,999 86 8 3 Dietary Supplement Manufacturers Establishment receipts threshold (in $) Cumulative percent of firms exempt (%) Cumulative percent of products exempt (%) Cumulative percent of sales exempt (%) <100,000 7.36 0.02 0.00 100,000-499,999 16.75 0.12 0.10 500,000-999,999 26.14 0.33 0.32 1,000,000-2,499,999 45.18 1.54 1.26 2,500,000-4,999,999 59.14 3.26 2.63 5,000,000-7,499,999 62.18 3.83 3.15 7,500,000-9,999,999 63.96 4.41 3.63 Applying the FDA exemptions (annual sales of no more than $500,000) at 21 CFR 101.9(j)(1)(i) and 101.36(h)(1) as described above would exempt 45 percent of firms, only one percent of products, and less than 0.5 percent of sales for food manufacturers, and only 17 percent of firms and about 0.1 percent of products and sales for dietary supplement manufacturers. In conducting the Initial Regulatory Impact Analysis, we estimated the impact of applying the USCB definition of very small enterprise (fewer than 20 employees), which falls somewhere between the $2.5 million and $5 million annual sales cutoffs. We found that both of these revenue cutoff levels for the definition of “very small food manufacturer” would offer significantly greater relief for those manufacturers, while still having a relatively minor impact on the amount of information available to consumers. Exempting manufacturers with annual receipts of less than $2.5 million would provide regulatory relief to 74 percent of food manufacturers and 45 percent of dietary supplement manufacturers, while reducing the number of products covered by four percent (two percent for dietary supplements), and the number of purchases covered by only one percent for both food and dietary supplement manufacturers. The NPRM solicited comments on alternative revenue cutoffs for the definition of “very small food manufacturer” of $500,000 and $5 million. Many commenters generally supported AMS's proposal. Some stated that there should be no exemption for very small food manufacturers or to use a $500,000 or $1,000,000 revenue cutoff. Some commenters stated that number of employees was a more suitable criterion in determining the threshold for a very small food manufacturer. One commenter recommended the agency should revise the definition of “very small food manufacturer ” in proposed 7 CFR 66.1 to read: “ any food manufacturer with either (1) annual receipts of less than $2,500,000 or (2) 50 or fewer employees, measured as an annual daily average.” Some commenters suggested that we should use food sales, rather than total receipts, to define small food manufacturers to avoid inclusion of firms that have multiple sources of income that could cause them to exceed the threshold. Some commenters stated that the exemption for very small food manufacturers be extended to small retailers. AMS has made no changes to its proposal. In considering this definition, AMS must balance providing regulatory flexibility for regulated entities and providing information to consumers regarding the bioengineered status of their foods. AMS considered other revenue cutoffs, including those above and below $2,500,000, and considered other definitions from various sources. Because food and dietary supplement manufacturers are in the manufacturing sector, they are both defined by number of employees for purposes of SBA size categorization. However, the firms defined as small or very small for purposes of the NBFDS all fall well below the SBA size categorizations, so we do not feel we need to be bound by that methodology. In addition, the small food manufacturer definition was defined to be consistent with the FDA definition of small manufacturer under its nutrition labeling standards, which use annual receipts. AMS believes that the very small food manufacturer definition should be consistent with these other definitions. AMS believes that annual receipts are a reasonable measure in determining the threshold for small businesses and specifically here, very small food manufacturers. Using total receipts is administratively simpler than tracking and demonstrating revenue by category for purposes of this rule. We do not expect that there are a significant number of firms for which this distinction would make a difference, but it would increase recordkeeping burden for all firms that fall under this exemption if it was based on food sales rather than annual receipts. The $2.5 million threshold will provide relief to small businesses, but will not markedly decrease the number of products subject to disclosure. By defining “very small food manufacturers” as those with annual receipts below $2,500,000, about 74 percent of food manufacturers are exempt from mandatory disclosure, but 96 percent of products will still be subject to disclosure. An increase in revenue cutoff would increase the number of exempt businesses, but would also increase the number of products exempt from disclosure. The definition of very small food manufacturer provides flexibility for small entities while providing information to consumers regarding the bioengineered status of their foods. With respect to comments seeking that this exemption extend to small retailers, AMS states that this exemption is statutorily mandated and cannot be extended to small retailers. To the extent that a small retailer is also a very small food manufacturer, they may be able to take advantage of the exemption in that instance. 3. Threshold Section 66.5(c) establishes a threshold for the inadvertent or technically unavoidable presence of bioengineered substances of up to five percent (5%) for each ingredient, with no such allowance for any BE presence that is intentional. Section 66.1 defines “bioengineered substance” as substance that contains genetic material that has been modified through in vitro recombinant deoxyribonucleic acid (rDNA) techniques and for which the modification could not otherwise be obtained through conventional breeding or found in nature. This definition differs slightly from the definition in the NPRM. We replaced the word “matter” with “substance” to simplify discussions about threshold. Thus, food in which any single ingredient contains more than 5% of a bioengineered substance, regardless of whether its presence is inadvertent or unintentional, is subject to disclosure. Food containing any amount of a bioengineered substance that is not inadvertent or unintentional is also subject to disclosure. In proposing an appropriate threshold level, AMS considered responses to the 30 questions posted on its website. Respondents offered a number of concepts to consider, including different threshold levels for determining exemptions (0.9, 5, and 10 percent) and different ways of calculating the threshold (by ingredient or by total weight). The NPRM solicited comments on multiple proposed issues pertaining to threshold exemptions. These exemptions consisted of three alternative thresholds for bioengineered substances that would trigger disclosure. The first proposed option (Alternative 1-A) would establish that food in which an ingredient contains a BE substance that is inadvertent or technically unavoidable, and accounts for no more than five percent (5%) of the specific ingredient, would not be subject to disclosure as a result of that one ingredient. The second proposed option (Alternative 1-B) would establish that food, in which an ingredient contains a BE substance that is inadvertent or technically unavoidable, and accounts for no more than nine-tenths percent (0.9%) of the specific ingredient by weight, would not be subject to disclosure as a result of that one ingredient. The third proposed option (Alternative 1-C) would allow regulated entities to use intentionally a small amount of BE ingredients up to a certain threshold, such as 5% of the total weight of the product, before being required to label a product with a BE disclosure. Some commenters supported threshold alternative 1-B, which would have exempted products where the bioengineered substance in an ingredient was inadvertent or technically unavoidable and less than 0.9 percent of each specific ingredient by weight. They suggested that this alternative is the most transparent, aligns with consumer expectations, is more widely used in other countries, and is the most closely aligned with existing industry standards. A small number of comments supported alternative 1-C, an exemption allowing for the intentional use of a bioengineered substance up to 5 percent of the total weight of the food, because it would allow for the de minimis use of BE ingredients. Many commenters generally opposed alternative 1-C. AMS has adopted Alternative 1-A because we believe this approach appropriately balances providing disclosure to consumers with the realities of the food supply chain. A threshold amount of 5 percent allows BE and non-BE production systems to coexist, whereas a lower threshold, such as 0.9 percent, may increase the regulatory burden for producers and food processors. Any disruption or increased burden on the food supply chain may unnecessarily increase the cost of producing food, and that cost may ultimately be passed on to consumers. To the degree that some production systems and supply chains have already adopted a threshold lower than 5 percent for purposes of voluntary labeling, continued compliance with a lower threshold for the inadvertent or technically unavoidable presence of a BE substance would meet the requirements of the NBFDS. AMS considered the threshold amounts used by other countries and acknowledges that there is no uniform or universal threshold amount. While some other countries have chosen lower amounts for their threshold, such as 0.9 percent, compliance with a lower threshold for a foreign country would still comply with the NBFDS. For example, a food produced and labeled for sale in a country with a threshold amount of 0.9 percent, would still comply with the 5 percent threshold AMS has chosen because 0.9 percent is lower than 5 percent. AMS believes this approach minimizes the potential burden on trade. AMS did not choose alternative 1-C or allow for the intentional use of a BE substance without requiring disclosure because the agency believes that allowing entities to avoid disclosing despite the intentional presence of BE substances in food does not provide consumers with the information they desire. In addition, AMS believes that, to the degree regulated entities are currently tracking the use of BE and non-BE foods for voluntary disclosure, most customary records only indicate the presence or absence of a BE substance and not necessarily the amount. Requiring regulated entities to track the amount of a BE substance for purposes of disclosure would create an unnecessary burden on regulated entities and likely increase their compliance costs. AMS reiterates that the threshold is intended to allow for coexistence among BE and non-BE crops, and nothing about the threshold amount is meant to convey anything related to health, safety, or environmental attributes of BE food as compared to non-BE alternatives. This rule is intended only to provide a mandatory uniform national standard to equip consumers with information for their personal use. 4. Animals Fed With Bioengineered Feed and Their Products The amended Act prohibits a food derived from an animal from being considered a BE food solely because the animal consumed feed produced from, containing, or consisting of a BE substance. 7 U.S.C. 1639b(b)(2)(A). Section 66.5(d) incorporates this statutory exemption. For example, eggs used in a baked good, where the eggs come from a chicken fed feed produced from BE corn and soy, would not be considered bioengineered solely on the basis of the chicken's feed. As most commenters noted, this exemption is mandated by the amended Act, and AMS does not have the authority to change this statutory mandate. Some commenters argued that the rationale for excluding the products of animals fed bioengineered feed should also apply to yeasts, rennet, and enzymes produced by fermentation using a bioengineered substrate. The plain reading of the statutory language exempting the products of animals fed bioengineered feed does not provide authority for AMS to extend the exemption to yeast, rennet, or enzymes or to extend the definition of “animal” to include those substances. As discussed above, those substances may be exempted if they qualify as an incidental additive or if they do not contain detectable modified genetic material. Thus, the final rule adopts the proposed rule text without revisions. 5. Food Certified Under the National Organic Program Subtitle F states that “[i]n the case of food certified under the national organic program established under the Organic Foods Production Act of 1990 (7 U.S.C. 6501 et seq. ), the certification shall be considered sufficient to make a claim regarding the absence of bioengineering in the food, such as `not bioengineered', `non-GMO', or another similar claim.” 7 U.S.C. 6524. The NPRM stated that implicit in the statutory provision is that certified organic foods are not subject to BE disclosure. This implication, in conjunction with the Secretary's authority to consider establishing consistency between the NBFDS and the Organic Foods Production Act, permits a regulatory exemption for products certified under the NOP. See 7 U.S.C. 1639b(f). The NPRM proposed that § 66.5(e) would exempt certified organic foods from BE disclosure. Commenters generally supported this exemption and some commenters stated the need for a technical correction to accurately exempt all food certified under the NOP and to create consistency with both the language and the meaning in the amended Act. The prohibition on the use of excluded methods extends to all NOP certified label categories (“100% Organic,” “Organic,” and “Made with Organic”) and all ingredients (organic and nonorganic) contained within each label category. Commenters stated that the inclusion of the phrase “. . . certified organic . . .” is problematic because it could imply that the exemption does not extend to products certified in the “made with organic (specified ingredients or food group(s))” labeling category and recommended that the exemption should be applied to foods certified under the NOP. AMS agrees with commenters that a technical correction to this provision is required. This exemption is intended to cover all NOP certified label categories (“100% Organic,” “Organic,” and “Made with Organic”) because NOP regulations at 7 CFR 205.301(a) through (c) clearly require that no ingredient may be bioengineered. See 7 CFR 205.301(f)(1) and 205.105(e) and the definition of “excluded methods” in 7 CFR 205.2. Accordingly, § 66.5(e) is revised to read “Food certified under the National Organic Program.” This exemption, however, does not apply to “products with less than 70 percent organically produced ingredients” as described in 7 CFR 205.301(d) and 205.305 because those products may include bioengineered ingredients along with organic ingredients. G. Severability AMS has added a new § 66.11 on severability in subpart A. This is a standard provision in regulations. This section provides that if any provision of part 66 is found to be invalid, the remainder of the part shall not be affected. III. Disclosure As statutorily required, the NBFDS, “for the purposes of regulations promulgated and food disclosures made pursuant to[], a bioengineered food that has successfully completed the pre-market Federal regulatory review process shall not be treated as safer than, or not as safe as, a non-bioengineered counterpart of the food solely because the food is bioengineered or produced or developed with the use of bioengineering.” 7 U.S.C. 1639b(b)(3) The amended Act provides three disclosure options for all food subject to the mandatory BE food disclosure standard, as well as additional options for small food manufacturers, and requires that the Secretary provide reasonable alternative disclosure options for food contained in small and very small packages. 7 U.S.C. 1639b(b)(2)(D), 1639b(b)(F), and 1639b(b)(E). In addition, the amended Act required the Secretary to conduct a study to identify potential technological challenges that may impact whether consumers have access to the bioengineering disclosure through electronic or digital disclosure methods and provides specific factors to be considered in the study. 7 U.S.C. 1639b(c)(1) and 1639(b)(c)(3). Based on the study, if the Secretary determines that consumers would not have sufficient access to the bioengineering disclosure through electronic or digital disclosure methods, the Secretary, after consultation with food retailers and manufacturers, shall provide additional and comparable disclosure options. 7 U.S.C. 1639b(c)(4). Subpart B specifies: (1) Who is responsible for the BE food disclosure in § 66.100; (2) the text disclosure in § 66.102; (3) the symbol disclosure in § 66.104; (4) the electronic or digital link disclosure in § 66.106; (5) the text message disclosure in § 66.108; (6) the disclosure options for small food manufacturers in § 66.110; (7) the disclosure options for small or very small packages in § 66.112; (8) the disclosure for food sold in bulk containers in § 66.114; (9) the voluntary disclosure in § 66.116; and (10) other claims in § 66.118. As used in subpart B, the key terms include “information panel” and “label.” As defined in § 66.1, these definitions are consistent with those used in the NOP regulations, 7 CFR 205.2. In addition, the terms “regulated entity,” “marketing and promotional information,” “principal display panel,” “small package,” “very small package,” and “small food manufacturer,” are also discussed. A. General 1. Responsibility for Disclosure The amended Act requires bioengineered food and bioengineered food ingredients to be labeled or “disclosed” in accordance with regulations promulgated by the Secretary. 7 U.S.C. 1639b(b)(1). Section 66.100(a) identifies three categories of entities responsible for disclosure: Food manufacturers, importers, and certain retailers. This final rule adopts these three categories of responsible entities as proposed. For purposes of clarity, a definition of “regulated entity” is incorporated in § 66.1 as “the food manufacturer, importer, or retailer that is responsible for making bioengineered food disclosures under § 66.100(a).” Accordingly, if a food is packaged prior to receipt by a retailer, either the food manufacturer or the importer is responsible for ensuring that the food label bears a BE food disclosure in accordance with this part. If a retailer packages a food or sells food in a bulk container and/or display, then the retailer is responsible for ensuring that the food bears a BE food disclosure in accordance with this part. Based on the input received from commenters, this approach will align responsibility for labeling with the requirements of other mandatory food labeling laws and regulations, including those administered by FDA and USDA FSIS. 2. International Impact Based on extensive input from commenters, we continue to find that importers should be subject to the same disclosure and compliance requirements as domestic entities. Importers of BE foods are subject to the requirements of the NBFDS and are required to make appropriate disclosures on the labels of BE foods imported and sold in the United States. Based on comments, this rule finds that establishing mutual recognition arrangements with appropriate foreign government entities that have established labeling standards for BE food may be appropriate in the future. No such recognition arrangements are currently in place or are established under this regulation. As no mutual recognition arrangements are currently in place, imports of products are subject to the disclosure and recordkeeping requirements of the NBFDS as described in this final rule. U.S. exports to non-partner countries will need to continue to meet that country's import requirements. 3. Appearance of Disclosure Requirements on how the disclosure must appear on food labels and packaging remain the same as proposed in the NPRM. As provided in § 66.100(c), the disclosure is required to be of sufficient size and clarity to appear prominently and conspicuously on the label, making it likely to be read and understood by the consumer under ordinary shopping conditions. AMS believes these requirements will align with other mandatory food labeling requirements, including those administered by FDA (21 CFR 101.15) and FSIS (9 CFR 317.2(b)). While FDA uses the term “customary conditions of purchase” (21 CFR 101.15), we have decided to utilize the term “ordinary shopping conditions,” as the statutory language references “shopping” in 7 U.S.C. 1639b(c)(4). AMS considered prescribing specific type sizes for different disclosure options, but after considering comments, determined that the number and type of disclosure options, combined with the variety of food package sizes, shapes, and colors, would make prescriptive requirements too difficult to implement. AMS believes that the requirements in § 66.100(c) will likely provide the BE food disclosure information to consumers in an accessible and transparent manner, while allowing regulated entities to have flexibility in implementing the requirements. 4. Placement of Disclosure As proposed, § 66.100(d) offered that the BE food disclosure be placed in one of the following places: The information panel adjacent to the statement identifying the name and location of the manufacturer/distributor or similar information; anywhere on the principal display panel; or an alternate panel if there is insufficient space to place the disclosure on the information panel or the principal display panel. Section 66.100(d) would not apply to bulk foods (see § 66.114). “Information panel” as defined in § 66.1 is consistent with the definitions found in the USDA NOP regulations at 7 CFR 205.2, which largely reflect those found in FDA's food labeling regulations at 21 CFR 101.2. “Principal display panel,” as defined in § 66.1, reflects the definition found in FDA's food labeling regulations at 21 CFR 101.1. Based on input from commenters, if there is insufficient space on either the information panel or the principal display panel, the disclosure may be placed on an alternate panel likely to be seen by a consumer under ordinary shopping conditions. Based on commenter feedback, this rule requires locating the disclosure on the information panel or the principal display panel because that is where consumers who are interested in additional food information typically look for information about their food. The information panel typically includes the nutrition fact panel, the ingredient list, the manufacturer/distributor name and address, and, if applicable, the country of origin. The principal display panel typically includes the statement of identity and the net quantity statement, in addition to other marketing claims. AMS believes that placing the BE food disclosure near this existing information will be effective because consumers will be able to see all the disclosures, statements, and marketing claims in one common place on the label. The NBFDS will require placement of the disclosure adjacent to the manufacturer/distributor name and location statement. Such placement will avoid interference with other required statements on the information panel. We think that the information panel will be an appropriate location for a mandatory BE food disclosure because food manufacturers are accustomed to making statements and disclosures required by FDA and FSIS on the information panel. By also permitting that the disclosure may appear on the principal display panel, AMS acknowledges that some regulated entities may want to increase transparency or highlight specific traits from the BE food in tandem with the BE food disclosure. Also, as a result of input from commenters, we are including additional flexibilities for food manufacturers; if there is insufficient space on the information panel or the principal display panel, the disclosure may be displayed in an alternate panel, provided the disclosure is available to the consumer under ordinary shopping conditions. In response to a received comment, AMS is clarifying the BE disclosure for multi-unit packages. For multi-unit packages where individual units are not labeled for retail sale and are enclosed within and not intended to be separated from the multi-unit package, AMS has determined that disclosure on the outer packaging in a manner consistent with the options provided in § 66.100(c) is sufficient to meet the requirements of the NBFDS. Any additional requirements regarding multi-unit packaging would be addressed in future rulemakings. This subpart does not prevent, pursuant to § 66.118, regulated entities from making other claims regarding bioengineered foods, provided that such claims are consistent with applicable Federal law. 5. How the List of Bioengineered Foods Relates to Disclosure The purpose of the List of Bioengineered Foods is to provide regulated entities with a tool to determine whether a food must bear a BE disclosure. If a food or food ingredient is on the List of Bioengineered Foods, and the regulated entity's records show that the food is a bioengineered food or does not indicate whether or not the food is bioengineered, the food must bear a BE disclosure. While we acknowledge that this framework may result in regulated entities placing a BE disclosure on a food that they do not know with certainty is bioengineered, we believe that it is appropriate to err on the side of disclosure to provide consumers with the fullest information about food that could be bioengineered. The List of Bioengineered Foods is alfalfa, apple (Arctic TM varieties), canola, corn, cotton, eggplant (BARI Bt Begun varieties), papaya (ringspot virus-resistant varieties), pineapple (pink flesh), potato, salmon (AquAdvantage®), soybean, squash (summer), and sugarbeet. These foods comprise most of the bioengineered crops or foods grown in the world and, therefore, most of the bioengineered food and food ingredients. As described in § 66.7, AMS will conduct annual reviews of the List. Through this process, AMS will request public input, including data and other information, to support any changes made. Any amendments (additions or deletions) to this List will be made through rulemaking. We recognize that for some items on this List, most varietals are not bioengineered. Because of this, AMS will maintain more detailed information on its website about each bioengineered crop or food to help regulated entities understand the associated bioengineered events for crops or foods they are sourcing and assist in determining whether disclosure is required. AMS will update information on its website as necessary. If a regulated entity is using a food, including an ingredient produced from such food, not on the List of Bioengineered Foods, and the regulated entity has actual knowledge that the crop or ingredient is, in fact, bioengineered, the entity is still responsible for labeling the food in compliance with the NBFDS. If a regulated entity uses a food, including an ingredient produced from such food, on the List of Bioengineered Foods and its records demonstrate that the food is not bioengineered ( e.g., modified genetic material is not detectable in accordance with § 66.9) or is exempt from disclosure under § 66.5, the food is not required to bear a BE disclosure. a. Disclosure Options Regulated entities have several disclosure options (text, symbol, electronic or digital link, and/or text message, with additional options available to small food manufacturers or for small or very small packages), with differing requirements, as described below. Regardless of the type of disclosure used, regulated entities can generally look to the List of Bioengineered Foods to determine if the food is required to have a BE disclosure. b. Use of the “May Be” Option The NPRM specifically requested comments on whether the phrase “may be” could be used when making a disclosure under the NBFDS. As proposed, the phrase “may be” would have been able to be inserted prior to the word “bioengineered” in the various disclosure methods, including a “may be bioengineered” symbol. This proposal was primarily included in the NPRM to provide regulated entities with flexibility when using food ingredients on the “low adoption” list of bioengineered foods. Because the List of Bioengineered Foods adopted in this rule does not distinguish between low and high adoption bioengineered foods, the “may be” option is no longer appropriate. Additionally, commenters explained how the use of “may be” in the disclosure will lead to unnecessary confusion for regulated entities and for consumers. Commenters explained that when consumers see the words “may be bioengineered” on a food package, consumers may be unsure whether the food is bioengineered or whether certain ingredients are bioengineered. Many commenters suggested that the disclosure be an affirmative statement. They noted that many of the countries with mandatory disclosure requirements do not allow the use of a “may” statement. Comments from food companies also described confusion around when the “may be” wording is appropriate. Commenters noted that because records must be maintained to substantiate claims of disclosure and non-disclosure, any such use of “may” claims would only serve to confuse consumers. For these reasons, disclosure under the NBFDS must be made with the term “bioengineered,” unless making a voluntary disclosure as described in § 66.116. The “may be bioengineered” disclosure cannot be used. B. Text Disclosure The amended Act allows for BE food to be labeled with a text disclosure. 7 U.S.C. 1639b(b)(2)(D). Regulated entities may utilize text to disclose the presence of bioengineered food or bioengineered food ingredients for foods in the List of Bioengineered Foods. For a food, including a food ingredient produced from that food, that is a raw agricultural commodity and for which records demonstrate that the food or food ingredient is bioengineered or does not indicate whether the food or food ingredient is bioengineered, the text disclosure is “bioengineered food.” This same disclosure is applicable to multi-ingredient food products in which all ingredients are on the List of Bioengineered Foods and are bioengineered or records do not indicate whether the ingredients are bioengineered. For a multi-ingredient food that contains ingredients that are and are not on the List of Bioengineered Foods and records demonstrate that at least one of the ingredients is bioengineered, or do not indicate whether any of the ingredients produced from one of the foods on the List of Bioengineered Foods are bioengineered, the text disclosure is “contains a bioengineered food ingredient.” We believe this approach provides flexibility to regulated entities, transparency to consumers, and recognizes that some foods are entirely a product of bioengineering and that some foods are a mix of BE and non-BE food ingredients. For BE food that is distributed solely in a U.S. territory, § 66.102(b) requires that disclosure statements equivalent to those above be allowed in the predominant language of that territory. AMS believes this approach will make the BE food disclosure more accessible in territories where the predominant language is something other than English. AMS also believes this allows regulated entities who only distribute food in a given territory to respond to consumer demand. C. Symbol Disclosure A symbol is another form of BE food disclosure regulated entities may use as set forth in the amended Act. 7 U.S.C. 1639b(c)(4). Regulated entities can use this symbol to designate BE food or food that contains a BE food ingredient. AMS proposed three alternative symbols with variations of those symbols and invited comment on each alternative and its variation. The three symbols were designed to communicate the bioengineered status of a food in a way that would not disparage biotechnology or suggest BE food is more or less safe than non-BE food. Based on comments, we have decided to use a variation of option 2-A below. AMS requested comments on whether the word “bioengineered” should be incorporated into the design of the chosen disclosure symbol. Based on comments, we have decided to include the word “bioengineered” in the symbol. This will improve the understanding of the symbol, as many comments explained that they did not understand what the acronym “BE” stood for. Comments in response to the NPRM reported results of independent surveys conducted during the public comment period that suggested the greatest number of respondents believe the symbol with the word “bioengineered” provides the right amount of information when compared to the symbol with the letters “BE.” 6 7 6 Public comment submitted by the International Food Information Council Foundation (IFIC) reports their May 2018 study regarding consumer attitudes and perceptions related to the NPRM. Comment may be accessed at https://www.regulations.gov/document?D=AMS-TM-17-0050-8861. 7 Public comment submitted by the Rutgers School of Environmental and Biological Sciences reports their June-July 2018 survey regarding consumer perceptions related to the proposed disclosure options in the NPRM. Comment may be accessed at https://www.regulations.gov/document?D=AMS-TM-17-0050-14011. The adopted symbol is a circle with a green circumference, with the word “bioengineered” displayed at the top and the bottom of the outer ring. The bottom portion of the circle contains an arch, filled in green to the bottom of the circle. The arch contains two light green terrace lines, sloping downward from left to right. On the left side of the arch, near the left side of the circle, is a stem arching towards the center of the circle, ending in a four-pointed starburst. The stem has two leaves coming from the upper side of the stem and pointing towards the top of the circle. At the top of the circle, to the left of center, in the background of the leaves, is a portion of a yellow circle that resembles a sun. The remainder of the circle is filled in light blue, resembling the sky. Commenters recognized that a multi-colored product label can increase printing costs and disrupt product design in other ways. Therefore, like the USDA Organic seal under the NOP, AMS will allow regulated entities to use a black and white version of the symbol. Regardless of colors, the symbol is required to meet the appearance and placement requirements in § 66.100. A supplemental document to this final rule contains the symbol in full color, as well as another variation of the symbol incorporating the words “derived from bioengineering” (for voluntary disclosure discussed below). The document may be viewed in the docket for this rulemaking at regulations.gov and on the AMS website. D. Electronic or Digital Link Disclosure The third disclosure option available for regulated entities to use is an electronic or digital link disclosure. 7 U.S.C. 1639b(b)(2)(D) and 1639b(d). The amended Act requires that the use of an electronic or digital link to disclose BE food must be accompanied by the statement “Scan here for more food information” or equivalent language that reflects technological changes. 7 U.S.C. 1639b(d)(1). This statutory requirement is incorporated in § 66.106(a)(1). AMS recognizes that electronic and digital links currently used on food products in the marketplace take different forms, and the amended Act allows for equivalent statements that reflect technological changes. Current technology includes, among others, quick response (QR) codes that are detectable by consumers and digital watermark technology that is imperceptible to consumers but can be scanned anywhere on a food package using a smart phone or other device. These technologies may or may not include an embedded Uniform Resource Locator (URL). Consequently, AMS will allow for other alternative statements that can appear above or below an electronic or digital link to direct consumers to the link to the BE food disclosure. Examples of other statements include: “Scan anywhere on package for more food information,” or “Scan icon for more food information.” The statement will provide the shopper with clear instructions on how to utilize an electronic device to scan a food package to obtain information about the bioengineered content of the food. Section 66.106(a)(2) incorporates the amended Act's requirement that the electronic or digital disclosure be accompanied by a telephone number that a consumer can call to access the disclosure information. 7 U.S.C. 1639b(d)(4). If a regulated entity decides to utilize electronic or scannable technology to convey bioengineered food information, they must also provide options for the consumer to access the disclosure by calling a phone number. There must be clear instructions for the shopper to “Call [1-000-000-0000] for more food information.” Many commenters explained how certain consumers do not understand how to utilize certain scannable technology to access food disclosure information. AMS believes that requiring regulated entities who are disclosing bioengineered food information through scannable means to offer the option to call a telephone number will best provide for accessible and understandable food information. The telephone number must be available at all times of the day and must clearly provide bioengineered food information to the caller. Pre-recorded information is permitted. The telephone number and instruction must be located in close proximity to the electronic or digital link. The amended Act requires the electronic or digital link to provide the bioengineering disclosure on the first product information page accessed through the link, without any marketing and promotional information. 7 U.S.C. 1639b(d)(2). Section 66.106(b) incorporates this requirement. “Marketing and promotional information” means “any written, printed, audiovisual, or graphic information, including advertising, pamphlets, flyers, catalogues, posters, and signs that are distributed, broadcast, or made available to assist in the sale or promotion of a product.” This definition aligns with that in the NOP regulations at 7 CFR 205.2. If a regulated entity wants to provide additional information about BE food to consumers, the information should be provided outside of the landing page that includes the BE food disclosure. Based on commenter suggestions to ensure reliable, consistent disclosure information to consumers, AMS is requiring that the disclosure on the product information page conform to the requirements of the text disclosure in § 66.102 or the symbol disclosure in § 66.104. AMS believes that using a uniform, consistent approach to the disclosure language and symbol will make it easier for consumers to understand the disclosure, whether that language or symbol appears on a food label or an electronic or digital device. AMS also believes that this approach will make compliance easier for entities responsible for disclosure, and ensure consistency in the communication of required disclosure information. If the regulated entity chooses to use an electronic or digital link, the amended Act requires that the entity not collect, analyze, or sell any personally identifiable information about consumers or their devices. 7 U.S.C. 1639b(d)(3)(A). Under § 66.106(b)(4), if such information must be collected to fulfill the disclosure requirements, that information must be deleted immediately and not used for any other purpose. 7 U.S.C. 1639b(d)(3)(B). E. Study on Electronic or Digital Disclosure and a Text Message Disclosure Option The amended Act requires the Secretary to conduct a study to identify potential technological challenges that may impact whether consumers would have access to the bioengineering disclosure through electronic or digital disclosure methods. 7 U.S.C. 1639b(c)(1). The Department contracted with Deloitte Consulting LLP to perform the study, received the study results from Deloitte Consulting LLP on July 27, 2017, and made the study available to the public on September 6, 2017, at https://www.ams.usda.gov/reports/study-electronic-or-digital-disclosure. As required by the amended Act, the study considered five factors: The availability of wireless internet or cellular networks; the availability of landline telephones in stores; challenges facing small retailers and rural retailers; the efforts that retailers and other entities have taken to address potential technology and infrastructure challenges; and the costs and benefits of installing in retail stores electronic or digital link scanners or other evolving technologies that provide bioengineering disclosure information. 7 U.S.C. 1639b(c)(3). The amended Act also requires the Secretary, after consultation with food retailers and manufacturers, to provide additional and comparable options to access the bioengineering disclosure, should the Secretary determine that consumers, while shopping, would not have sufficient access to the bioengineering disclosure through electronic or digital disclosure methods. 7 U.S.C. 1639b(c)(4). Several commenters agreed that the challenges described in the study prevented consumers from accessing electronic or digital disclosures. Other commenters noted that smartphone usage and broadband access were increasing in the United States. After reviewing the study and comments submitted to the NPRM related to the study, the Secretary has determined that consumers would not have sufficient access to the bioengineering disclosure through electronic or digital means under ordinary shopping conditions at this time. While a large number of Americans have a smartphone and a large number of national and regional supermarkets provide Wi-Fi, most consumers in the study experienced technical challenges in accessing the bioengineered food disclosure on their phones. The NPRM proposed text message as an additional disclosure option if the Secretary were to determine that shoppers would not have sufficient access to digital or electronic disclosure. Food manufacturers and retailers that commented on this option were generally supportive of this option. Thus, AMS is adopting the text message option in § 66.108. Regulated entities that choose this option are required to include a statement on the package that instructs consumers on how to receive a text message. Those instructions can be shared or centralized among regulated entities, if so desired. Industry is not prohibited from developing a standardized instruction or response if it is in compliance with the NBFDS regulations. A one-time automated response would immediately provide the disclosure using text in conformance with § 66.102. Similar to the electronic or digital disclosure, the text message is not allowed to contain marketing and promotional information. The regulated entity must not collect, analyze, or sell any personally identifiable information, unless necessary to complete the disclosure, or use any information related to the text message for marketing purposes. If the regulated entity must collect any personally identifiable information to complete the disclosure process, it must immediately delete the information and not use it for any other purpose. Additionally, consumers must not be charged a fee by the regulated entity to access the disclosure information. However, consumers may be subject to a text messaging fee charged through their wireless telephone carrier. F. Small Food Manufacturers The amended Act provides two additional disclosure options for small food manufacturers: (1) A telephone number accompanied by appropriate language to indicate that the phone number provides access to additional information; and (2) an internet website address. 7 U.S.C. 1639b(b)(2)(F)(ii). In addition, in the case of small food manufacturers, the amended Act provides that the implementation date not be earlier than one year after the implementation date for regulations promulgated in accordance with the NBFDS. See 7 U.S.C. 1639b(b)(2)(F)(i). 1. Definition AMS has made very minor changes to the definition of small food manufacturer. AMS defines “small food manufacturer” as “any food manufacturer with annual receipts of at least $2,500,000 but less than $10,000,000.” This definition is similar to FDA's final rule to extend the compliance dates for manufacturers with less than $10 million in annual food sales ( see 83 FR 19619). Section 66.110 provides two additional options that are available to small food manufacturers in addition to the text, symbol, electronic or digital link, or text message disclosure options. The two options are disclosure by telephone number and by internet website. 2. Telephone Number Under § 66.110(a), if a small food manufacturer chooses to use a telephone number to disclose the presence of a BE food or BE food ingredients, a compliant text accompanying the telephone number is “Call [1-000-000-0000] for more food information.” The telephone number should provide the BE food disclosure regardless of the time of day. Disclosure via telephone number must include a BE food disclosure information that is consistent with § 66.102 in audio form and can be pre-recorded. While some commenters suggested that a telephone disclosure at any time of day would be burdensome and unreasonable, AMS believes that the requirement to provide the BE food disclosure at any time of day is reasonable, given the different hours that consumers shop for groceries and the varying time zones in the United States. Because the disclosure by telephone can be accomplished through a recorded message, AMS does not believe that requiring the disclosure to be available at any time of day will increase the burden on small food manufacturers. 3. Internet Website Under § 66.110(b), if the small food manufacturer chooses to use an internet website to disclose the presence of BE food or BE food ingredients, text would need to accompany the website address on the label stating, “Visit [Uniform Resource Locator of the website] for more food information.” The website must meet the requirements for a product information page in § 66.106(b). Disclosure via website must include a bioengineered food disclosure that is consistent with § 66.102 or § 66.104 in written form. AMS believes that implementing the internet website option for small food manufacturers in conformance with the requirements for the electronic or digital disclosure product information page will give small food manufacturers the flexibility to disclose in a way that is cost effective for a small business, while providing disclosure to consumers and the same level of protection for personally identifiable information. G. Small and Very Small Packages The amended Act requires the Secretary to provide alternative reasonable disclosure options for food contained in small or very small packages. 7 U.S.C. 1639b(b)(2)(E). In order to ensure consistency with existing labeling requirements, the definition of “small packages” was taken from FDA labeling requirements at 21 CFR 101.9(j)(17). The definition of “very small package” was also taken from FDA labeling requirements at 21 CFR 101.9(j)(13)(i). Section 66.112 continues to provide certain flexibilities for food in small and very small packages: A modified version of the electronic or digital link disclosure in § 66.106; a modified version of the text message in § 66.108; and a modified version of the phone number disclosure in § 66.110. In addition, for very small packages, regulated entities may use a label's preexisting Uniform Resource Locator or telephone number for disclosure. For the modified version of the electronic or digital link, § 66.112(a) allows regulated entities to utilize the electronic or digital link in § 66.106, but replace the statement “Scan here for more food information” and the accompanying phone number and instructions required in paragraph (a) of that section with the statement “Scan for info.” AMS believes that shortening the statement may make the electronic or digital link disclosure small enough to fit on small and very small packages. For the modified version of the text message, § 66.112(b) allows regulated entities to utilize the text message in § 66.108, but replace the statement “Text [number] for more bioengineered food information” with “Text [number] for info.” AMS believes that shortening the statement may make the text message disclosure small enough to fit on small and very small packages. Similarly, AMS believes that a phone number with a short statement is small enough to fit on small and very small packages. Section 66.112(c) requires the disclosure to meet the requirements of § 66.110, but allows the statement “Call [1-000-000-0000] for more food information” to be replaced with “Call [1-000-000-0000] for info.” AMS recognizes that very small packages have limited surface area on which to bear disclosures. Under § 66.112(d), for very small packages, if the label includes a preexisting Uniform Resource Locator for a website or a telephone number that a person can use to obtain other food information, that website or telephone number may also be used for the BE food disclosure, provided that the disclosure is consistent with § 66.102 or § 66.104 in written or audio form, as applicable. Stakeholders representing food manufacturers who use small and very small packages indicated that using the symbol under § 66.104 is a viable disclosure option. Accordingly, the symbol and other disclosure options available to all entities responsible for disclosure are also available to those who package foods in small and very small packages. AMS believes providing the additional options described above will provide needed flexibility for disclosure on small and very small food packages. H. Food Sold in Bulk Containers Because bulk products, such as cornmeal in a bin or unpackaged produce, are frequently displayed without packaging and placed on display by retailers, rather than food manufacturers or importers, AMS requires that retailers be held responsible for complying with the BE food disclosure of bulk food. AMS already requires bulk foods sold in grocery stores to comply with Country of Origin Labeling requirements and believes that retailers are already accustomed to ensuring that bulk food appears with appropriate signage. As requested by several commenters, § 66.114(a) requires that the BE food disclosure on bulk foods appears using any of the options for on-package disclosure including: Text, symbol, electronic or digital link, or text message (if applicable). The disclosure is required to appear on signage or other materials (stickers, bindings, etc.) on or near the bulk item. AMS believes the requirement that the signage or materials include the disclosure will allow consumers to identify and understand the bioengineered status of the food and allow retailers to adapt to new technologies and consumer preference. Retailers who use an electronic or digital link will be required to place any sign or image to be scanned in a place readily accessible by consumers. For all other disclosure options, signs currently used on or near bulk items, when supplemented with the BE food disclosure, are sufficient to comply with the requirements of the amended Act. I. Voluntary Disclosure AMS received significant input on the proposed NBFDS regarding the ability for regulated entities to voluntarily label foods not subject to mandatory BE disclosure requirements. Comments from food companies explained that consumers expect transparency and as much information as possible on the origin of food ingredients. Comments from consumers agreed. AMS acknowledges that voluntary disclosure provisions enable food manufacturers, retailers, and other entities to share more information with consumers, provided the information is truthful and not misleading and otherwise in compliance with all applicable Federal laws. In designing the NBFDS, which is focused on positive disclosure claims, AMS has attempted to provide as much flexibility to the food and grocery industry as possible, along with the transparency to consumers that they expect and deserve. As such, the final rule provides for voluntary labeling (1) by entities that are otherwise exempt from the requirements of the NBFDS or (2) for certain foods that do not meet the definition of “bioengineered food” but are derived from bioengineered crops or food. Voluntary labeling is only permitted in these circumstances. Entities that are exempt from the NBFDS are very small food manufacturers, and restaurants and similar retail food establishments. Under § 66.116(a) those entities may voluntarily include a bioengineered disclosure on their products in the same manner as those that are required to provide a BE disclosure. Under § 66.116(b), regulated entities may voluntarily include a disclosure for foods or food ingredients derived from items on the List of Bioengineered Foods. A food that meets a factor or condition under paragraph (2) of the definition of “bioengineered food” in § 66.1 or is exempt from disclosure under §§ 66.5(c)-(e), is prohibited from voluntary disclosure under the NBFDS. For example, a soup that lists beef broth as the first ingredient on the ingredient list may not bear a voluntary disclosure regardless of the other ingredients in the soup. Voluntary labeling provisions are found in § 66.116. As described earlier in this final rule, only products that contain ingredients with detectable modified genetic material, as demonstrated through records maintained by the regulated entity, must be disclosed. This means that many refined products originating from bioengineered crops do not constitute bioengineered foods. However, if a food manufacturer, retailer, or importer that would otherwise not be required to provide a disclosure wants to voluntarily disclose that a refined food originates from an item on the List of Bioengineered Foods, it is free to do so. For example, if a beverage company makes a carbonated soda containing corn syrup originating from BE corn, and the corn syrup does not have detectable modified genetic material, the corn syrup alone does not trigger mandatory disclosure. Under voluntary labeling provisions, because the corn syrup originates from BE corn, the beverage company may provide a disclosure explaining to the consumer that the ingredients in the soda are “derived from bioengineering,” even though the ingredient is not for the purposes of this regulation considered to be “bioengineered.” AMS believes that exempt entities should also be permitted to voluntarily disclose bioengineered foods. For instance, AMS believes that very small food manufacturers, who are entities with less than $2.5 million in annual receipts and who are exempt from mandatory disclosure requirements, should also be able to voluntarily disclose the presence of bioengineered ingredients, or ingredients originating from bioengineered crops. If a very small food manufacturer is using items on the List of Bioengineered Foods that contain modified genetic material and the food would be subject to mandatory disclosure requirements but for the company size exemption, they may provide a disclosure as provided in § 66.116(a). If a very small food manufacturer is using ingredients that do not contain modified genetic material but are derived from items on the List of Bioengineered Foods, they also may utilize the voluntary disclosure rules explained in § 66.116(b). It is important to note that when entities utilize the voluntary disclosure provisions in § 66.116, they are required to comply with the disclosure requirements (size, location on package, etc.) for text, symbol, digital or electronic link, or text message disclosure, as applicable. IV. Administrative Provisions A. Recordkeeping Requirements The amended Act requires each person subject to mandatory BE food disclosure under the NBFDS to maintain records such as the Secretary determines to be customary or reasonable in the food industry to establish compliance with the Standard. See 7 U.S.C. 1639b(g) [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A2018-27283. Public record. Not legal advice.