Rules of Practice

DEPARTMENT OF AGRICULTURE

Food Safety and Inspection Service

9 CFR Parts 304, 305, 327, 335, 381, and 500

[Docket No. 95-025P]

RIN 0583-AC34

Rules of Practice

AGENCY: Food Safety and Inspection Service, USDA.

ACTION: Proposed rule.

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SUMMARY: The Food Safety and Inspection Service (FSIS) is proposing to

consolidate and amend its regulations concerning the rules of practice

that apply to refusal, suspension, or withdrawal of inspection

services. FSIS also is proposing to add specific language regarding the

refusal, suspension, or withdrawal of inspection services when the

Agency determines that an establishment's Hazard Analysis and Critical

Control Point (HACCP) system is inadequate, an establishment is not

meeting the Salmonella pathogen reduction performance standards, an

establishment's Sanitation Standard Operating Procedures (Sanitation

SOP's) are inadequate or ineffective, or an establishment is not

complying with generic E. coli testing requirements. This proposal is

part of FSIS's ongoing efforts to consolidate, streamline, and clarify

the meat and poultry product inspection regulations.

DATES: Comments on the proposed regulations must be received on or

before March 13, 1998.

ADDRESSES: Please send an original and two copies of comments to: FSIS

Docket Clerk, Docket No. 95-025P, Room 102, Cotton Annex, 300 12th

Street, SW, Washington, DC 20250-3700.

FOR FURTHER INFORMATION CONTACT: Ms. Patricia Stolfa, Assistant Deputy

Administrator, Office of Policy, Program Development and Evaluation,

FSIS, Room 402, Cotton Annex Building, 300 12th Street, SW, Washington,

DC 20250-3700; (202) 205-0699.

SUPPLEMENTARY INFORMATION:

Background

Under the authority of the Federal Meat Inspection Act (FMIA) and

the Poultry Products Inspection Act (PPIA), FSIS can refuse to grant

inspection, suspend inspection, or withdraw inspection services from

establishments based on unsanitary conditions (9 CFR 335.13 and

381.234), inhumane livestock slaughtering (9 CFR 335.30-.32), or

unfitness to engage in business because of prior criminal convictions

(9 CFR 335.10 and 381.231). Inspection services also can be suspended

or withdrawn if establishments fail to destroy condemned product (9 CFR

335.11 and 9 CFR 381.232), or if establishment personnel assault,

intimidate, or interfere with inspection service employees (9 CFR

335.20-.21 and 381.235-.236). Additionally, FSIS can rescind approval

of any marking, labeling, or container that is false or misleading (9

CFR 335.12 and 381.233).

As discussed in the ``Pathogen Reduction; Hazard Analysis and

Critical Control Point (HACCP) System'' final rule (61 FR 38806), FSIS

also can refuse to grant, suspend, or withdraw the grant of inspection

if an establishment has failed to: (1) Develop and implement a HACCP

plan or operate in accordance with 9 CFR Part 417; (2) develop,

implement, and maintain Sanitation SOP's in accordance with 9 CFR part

416; (3) conduct generic E. coli testing in accordance with 9 CFR

310.25(a) or 381.45(a); or (4) meet the pathogen reduction performance

standard for Salmonella or, after failing two sample sets, reassess its

HACCP plan in accordance with 9 CFR 310.25(b) or 381.94(b).

When FSIS determines to refuse to grant an application for

inspection, to withdraw a grant of inspection, or to rescind or refuse

to approve markings, labels or containers, the Agency initiates an

administrative action under USDA's Rules of Practice Governing Formal

Adjudicatory Proceedings Instituted by the Secretary Under Various

Statutes (7 CFR subtitle A, part 1, subpart H), as supplemented by its

own ``Rules of Practice,'' which are set out in 9 CFR part 335 or part

381, subpart W. The Department's uniform Rules of Practice contain the

procedures applicable to formal adjudicatory proceedings under various

USDA implemented statutes, including specified sections of the FMIA and

PPIA. The Department's Rules of Practice contain procedures that FSIS

follows when filing a complaint with the Department's Hearing Clerk and

requesting a hearing before an Administrative Law Judge. FSIS's current

supplemental Rules of Practice regulations provide establishments an

opportunity to correct problems before the Agency files a complaint to

withdraw the establishment's grant of inspection. However, FSIS may

suspend inspection services until the problem is corrected.

Generally, FSIS initially uses ``withholding actions'' to withhold

the mark of inspection from an establishment's products that are

deficient. A U.S. Retain Tag is placed on deficient product or a U.S.

Rejected Tag is attached to deficient equipment. The withholding action

is discontinued when the deficiencies are corrected.

In most cases, FSIS suspends inspection services only after

repeated violations. A suspension may affect an entire establishment or

may be limited to a specific process or production line within the

establishment. A suspension will last until the establishment achieves

compliance with the applicable laws and regulations. If the suspension

involves an entire establishment, FSIS removes inspection personnel

unless there is reason to believe that corrective action can be

completed in a timeframe that is

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consistent with the efficient assignment of program personnel. FSIS may

allow the establishment to operate while under a suspension if the

establishment presents adequate written assurances that corrective

actions are being implemented. If establishments fail to take

appropriate corrective actions, FSIS may proceed to file a complaint to

withdraw inspection services, as discussed above.

FSIS is committed to providing establishments with appropriate

notice and an opportunity to appeal withholding actions and suspensions

of inspection. It recognizes the need for timely resolution of all such

appeals. Withholding actions taken by FSIS inspectors can be appealed

to the next level of supervision. The decision to suspend inspection

services is made by the District Manager. Traditionally, appeal from

this decision has been to the Assistant Deputy Administrator for Field

Enforcement Operations. FSIS intends to continue handling appeals

through the ``chain-of-command'' process, which is incorporated into

FSIS's existing regulations (9 CFR 306.5 and 381.35). However, the

Agency has received comments raising concerns about the timeliness of

this process, especially when operations have been shut down.

FSIS welcomes comments on the adequacy of its approach. One

possible alternative to the Agency's traditional approach would be for

it to include specific appeal procedures in the supplemental Rules of

Practice regulations concerning the procedures that the Agency will

follow in providing notice and an opportunity to contest a suspension.

For example, the appeal procedures could be modeled after the Food and

Drug Administration's procedures for supervisory review (21 CFR 10.75)

. FSIS also requests comments on how it should provide notice of a

suspension action and on whether additional procedures are necessary

and appropriate if an establishment wishes to appeal a suspension. FSIS

will consider the comments it receives on these issues and intends to

provide the most appropriate review mechanisms in any final rule that

it issues.

Proposed Rule

For the most part, FSIS's supplemental Rules of Practice duplicate

each other and the Department's uniform Rules of Practice regulations.

FSIS's regulations do, however, establish procedures for the suspension

of inspection services. However, these regulations are difficult to

read and do not clearly outline the process. Therefore, as part of

FSIS's ongoing efforts to consolidate, streamline, and clarify the meat

and poultry products inspection regulations, FSIS is proposing to

reorganize and revise these regulations to eliminate redundancy and to

clearly identify the processes and situations involved when FSIS

suspends inspection services.

FSIS is proposing to revise and consolidate the existing

regulations into a new part, CFR Part 500, ``Rules of Practice.''

Section 500.11 in this proposed new part is titled, ``Refusal to Grant

Inspection'' and sets out the following different bases on which FSIS

may refuse to grant inspection services to an applicant: (1) Failure to

develop a HACCP plan as required by Secs. 417.2 and 417.4; (2) failure

to develop Sanitation SOP's as required by part 416; (3) failure to

demonstrate that adequate sanitary conditions exist in accordance with

part 416, and part 308 or part 381, subpart H; or (4) failure to

demonstrate that livestock will be handled and slaughtered humanely

(proposed Sec. 500.11(a)). Proposed Sec. 500.11(b) states that, if FSIS

refuses to grant inspection, the applicant will be notified and have an

opportunity for a hearing in accordance with the uniform Rules of

Practice, 7 CFR Subtitle A, part 1, subpart H.

Section 500.12 in the proposed new part is titled ``Conditions for

the Suspension or Withdrawal of Inspection.'' This section lists the

following as the different bases on which FSIS may suspend or withdraw

inspection: (a) Failure to implement HACCP or operate in accordance

with part 417; (b) failure to implement or maintain Sanitation SOP's in

accordance with part 416; (c) failure to collect and analyze samples

for E. coli Biotype I and record results in accordance with

Secs. 310.25(a) or 381.94(a); (d) failure to meet the Salmonella

performance standard requirements or reassess a HACCP plan in

accordance with Secs. 310.25(b) or 381.45(b); (e) failure to maintain

sanitary conditions in accordance with part 308 or part 381, subpart H;

(f) failure to destroy a condemned meat or poultry carcass, or part or

product thereof, in accordance with part 314 or part 381, subpart L,

within three days of notification; (g) assault, threat of assault,

intimidation or other interference with an inspection service

employee's performance of official duties; or (h) inhumane slaughtering

or handling of livestock.

Section 500.13 of the proposed new part is titled ``Suspension of

Inspection.'' It states that inspection services may be suspended at an

establishment that has a condition described in Sec. 500.12, and that

if inspection is suspended, an establishment will receive a written

``Notice of Suspension of Inspection.'' Under proposed Sec. 500.13(b),

the notice will include the following: (1) The effective date of the

suspension; (2) the reasons for the suspension; and (3) the name and

address where an appeal may be sent. Proposed Sec. 500.13(c) states

that a suspension of inspection will remain in effect until an

establishment brings itself into compliance with the regulations.

Section 500.14 of the proposed new part is ``Withdrawal of

Inspection.'' It states that inspection services may be withdrawn at an

establishment that fails to correct conditions in Sec. 500.12 (proposed

Sec. 500.14(a)) and that FSIS will initiate a complaint to withdraw

inspection in accordance with the Uniform Rules of Practice, 7 CFR

Subtitle A, part 1, subpart H (proposed Sec. 500.14(b)).

Section 500.15 of the proposed new part is titled ``Rescinding the

Approval of Marks, Labels, or Containers'' and states that FSIS will

rescind or refuse approval of false or misleading marks or labels or

container sizes or forms for use with any meat or poultry product under

section 7 of the FMIA, or under section 8 of the PPIA, in accordance

with the Uniform Rules of Practice, 7 CFR Subtitle A, part 1, subpart

H. Proposed Sec. 500.15(b) states that the Agency will provide

notification that explains the basis for any such action, grants an

opportunity to modify the marking, labeling, or container so that it is

no longer false or misleading, and advises the firm of its opportunity

for a hearing with respect to the merits or validity of the Agency's

determination about the product's labeling.

Section 500.16 of the proposed new part is titled ``Refusing or

Withdrawing Inspection Service for Unfitness to Engage in Business

Requiring Federal Inspection'' and states that applicants for

inspection services or recipients of inspection services unfit to

engage in business requiring inspection as specified in section 401 of

the FMIA or section 18(a) of the PPIA will be refused or have their

inspection services withdrawn in accordance with the Uniform Rules of

Practice, 7 CFR Subtitle A, part 1, subpart H.

There is one provision in the current regulations that FSIS has not

incorporated into the proposed regulations. Under the current

regulations in section 335.13, establishments operating under

insanitary conditions are notified by FSIS as to what action is

necessary to

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correct the violations and of the time period within which corrections

must be made. FSIS has decided not to incorporate this provision in

these proposed regulations because, as discussed in the Pathogen

Reduction/HACCP final rule, it is the establishment's responsibility to

identify problems that exist and to determine how best to correct them.

FSIS also is proposing to delete some of its other regulations that

are duplicative. First, this proposal would eliminate Sec. 305.5, (9

CFR 305.5) ``Withdrawal of Inspection; Statement of Policy.'' The

subject that this statement of policy addresses is dealt with fully in

proposed Part 500. Similarly, the Agency is proposing to eliminate

Sec. 381.29, which is duplicative for the same reason.

The Agency is also proposing to eliminate all portions of

Secs. 304.2, 327.6 and 381.21 that refer to denying or refusing an

application for inspection or import reinspection services and to

replace those portions with a statement indicating that any application

for inspection services can be denied in accordance with the rules of

practice in Part 500.

Lastly, FSIS is proposing to remove part 335, subpart E. This

subpart, also referred to as the ``present your views'' (PYV)

provision, was added in 1988 under the Processed Products Inspection

Improvement Act of 1986 (Pub. L. 99-641, Title VI), which was not

reauthorized by Congress in 1992.

The PYV provision allows suspected violators of the FMIA an

opportunity to present their views regarding the alleged criminal

violation to the Secretary of Agriculture before FSIS refers the

violation to the Department of Justice for prosecution. Because the PYV

provision can be a useful administrative procedure, FSIS will continue

to use the PYV process, as a matter of administrative discretion, in

appropriate situations. However, FSIS has determined that it is

unnecessary to continue to include the provision in its regulations.

Executive Order 12866 and Regulatory Flexibility Act

This proposed rule has been determined to be not significant, and

therefore, has not been reviewed by the Office of Management and

Budget.

The Administrator has made an initial determination that this

proposed rule would not have a significant economic impact on a

substantial number of small entities, as defined by the Regulatory

Flexibility Act (5 U.S.C. 601).

There are no direct costs or benefits associated with this

proposal. Costs and benefits are related to the regulatory actions, not

the proceedings. At the present time, there is no way to predict

whether ``down time'' will increase or decrease under these proposed

rules of practice. To the extent that disputes can be resolved in a

timely and more efficient manner, there are potential benefits to both

industry and the government. To the extent that clear rules of practice

promote timely and effective regulatory action, there would also be

consumer protection benefits.

When disputes are related to public health issues, there is a risk

reduction component to having operations suspended during the period of

resolution. There are also costs associated with actions that suspend

production operations.

Executive Order 12988

This proposed rule has been reviewed under Executive Order 12988,

Civil Justice Reform. If the proposed rule becomes final: (1) All state

and local laws and regulations that are inconsistent with this rule

would be preempted; (2) no retroactive effect would be given to this

rule; and (3) administrative proceedings would not be required before

parties may file suit in court challenging this rule.

Paperwork Requirements

This proposed rule does not include any new paperwork requirements.

List of Subjects

9 CFR Part 304

Meat inspection.

9 CFR Part 305

Meat inspection.

9 CFR Part 327

Imports, Meat inspection.

9 CFR Part 381

Poultry and poultry products.

9 CFR Part 500

Administrative practice and procedure, Crime, Government employees,

Meat inspection.

For the reasons set forth in this preamble, 9 CFR chapter III would

be amended as follows:

PART 304--APPLICATION FOR INSPECTION; GRANT OF INSPECTION

1. The authority citation for part 304 would continue to read as

follows:

Authority: 21 U.S.C. 601-695; 7 CFR 2.18, 2.53.

2. Part 304 would be amended by revising the title to read as set

forth above, amending Sec. 304.2 to remove paragraphs (c) and (e),

redesignating paragraph (d) as paragraph (c), and removing the last

sentence of paragraph (b) and replacing it with a sentence to read as

follows:

Sec. 304.2 Information to be furnished; grant or refusal of

inspection.

* * * * *

(b) * * * Any application for inspection services may be refused in

accordance with the rules of practice in part 500 of this chapter.

* * * * *

PART 305--OFFICIAL NUMBERS; INAUGURATION OF INSPECTION; WITHDRAWAL

OF INSPECTION; REPORTS OF VIOLATION

3. The authority citation for part 305 would continue to read as

follows:

Authority: 21 U.S.C. 601-695; 7 CFR 2.18, 2.53.

4. Part 305 would be amended by removing section 305.5.

PART 327--IMPORTED PRODUCTS

5. The authority citation for part 327 would continue to read as

follows:

Authority: 21 U.S.C. 601-695; 7 CFR 2.18, 2.53.

6. Section 327.6 would be amended by removing the last four

sentences in paragraph (f) and replacing them with one sentence to read

as follows:

Sec. 327.6 Products for importation; program inspection, time and

place; application for approval of facilities as official import

inspection establishment; refusal or withdrawal of approval; official

numbers

* * * * *

(f) * * * Any application for inspection services under this

section may be denied or refused in accordance with the rules of

practice in part 500 of this chapter.

* * * * *

PART 335--RULES OF PRACTICE GOVERNING PROCEEDINGS UNDER THE FEDERAL

MEAT INSPECTION ACT

7. Part 335 would be removed.

PART 381--POULTRY PRODUCTS INSPECTION REGULATIONS

8. The authority citation for part 381 would continue to read as

follows:

Authority: 7 U.S.C. 138f; 7 U.S.C. 450, 21 U.S.C. 451-470; 7 CFR

2.18, 2.53.

9. Section 381.21 would be revised to read as follows:

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Sec. 381.21 Refusal of inspection.

Any application for inspection services in accordance with this

part may be denied or refused in accordance with the rules of practice

in part 500 of this chapter.

10. Part 381 would be amended by removing section 381.29.

11. Part 381 would be amended by removing Subpart W.

SUBCHAPTER E--REGULATORY REQUIREMENTS UNDER THE FEDERAL MEAT

INSPECTION ACT AND THE POULTRY PRODUCTS INSPECTION ACT

12. Subchapter E would be amended by adding a new Part 500 to read

as follows:

PART 500--RULES OF PRACTICE

Sec.

500.11 Refusal to grant inspection.

500.12 Conditions for the suspension or withdrawal of inspection.

500.13 Suspension of inspection.

500.14 Withdrawal of inspection.

500.15 Rescinding or refusing approval of marks, labels, and

containers.

500.16 Refusing or withdrawing inspection for applicants or

recipients unfit to engage in business.

Authority: 7 U.S.C. 450, 1901-1906; 21 U.S.C. 451-470, 601-695;

7 CFR 2.18, 2.53.

Sec. 500.11 Refusal to grant inspection.

(a) Inspection services may be refused to be granted at an

establishment for any of the following reasons:

(1) Failing to develop a HACCP plan as required by Secs. 417.2 and

417.4 of this chapter; or

(2) Failing to develop Sanitation SOP's as required by part 416 of

this chapter; or

(3) Failing to demonstrate that adequate sanitary conditions exist

as required by part 308 or part 381, subpart H, and part 416 of this

chapter; or

(4) Failing to demonstrate that livestock will be handled and

slaughtered humanely.

(b) If FSIS refuses to grant inspection services, the applicant

will be notified and given an opportunity for a hearing in accordance

with the Uniform Rules of Practice, 7 CFR, subtitle A, part 1, subpart

H.

Sec. 500.12 Conditions for the suspension or withdrawal of inspection.

Inspection services may be suspended or withdrawn at an

establishment for any of the following reasons:

(a) Failing to implement HACCP or operate in accordance with part

417 of this chapter; or

(b) Failing to implement or maintain Sanitation SOP's in accordance

with part 416 of this chapter; or

(c) Failing to maintain sanitary conditions in accordance with part

308 or part 381, subpart H, and part 416 of this chapter; or

(d) Failing to collect and analyze samples for Escherichia coli

Biotype I and record results in accordance with Secs. 310.25(a) or

381.94(a) of this chapter; or

(e) Failing to meet the Salmonella performance standard

requirements in accordance with Secs. 310.25(b)(3)(iii) and

381.94(b)(3)(ii) of this chapter; or

(f) Failing to destroy a condemned meat or poultry carcass, or part

or product thereof, in accordance with part 314 or part 381, subpart L,

of this chapter within three days of notification; or

(g) Impairing inspection because of assaults, threats of assault,

intimidation or other interference that prevents a program official

from conducting official duties; or

(h) Slaughtering or handling livestock inhumanely.

Sec. 500.13 Suspension of inspection.

(a) Inspection services may be suspended at an establishment for

any of the conditions described in Sec. 500.12 of this part.

(b) If inspection services are suspended, an establishment will

receive a written ``Notice of Suspension of Inspection.'' The notice

will provide the following:

(1) The effective date of the suspension.

(2) The reasons for the suspension.

(3) The name and address where an appeal may be sent.

(c) A suspension of inspection services will remain in effect until

an establishment is found to be in compliance with the regulations in

this chapter.

Sec. 500.14 Withdrawal of inspection.

(a) A grant of inspection services may be withdrawn at an

establishment that fails to correct any of the conditions described in

Sec. 500.12 of this part.

(b) FSIS will initiate a complaint to withdraw inspection services

in accordance with the Uniform Rules of Practice, 7 CFR, subtitle A,

part 1, subpart H.

Sec. 500.15 Rescinding or refusing approval of marks, labels, and

containers

(a) FSIS will rescind or refuse approval of false or misleading

marks, labels, or sizes or forms of any container for use with any meat

or poultry product under section 7 of the FMIA, or under section 8 of

the PPIA, in accordance with the Uniform Rules of Practice, 7 CFR,

subtitle A, part 1, subpart H.

(b) FSIS will provide written notification that:

(1) Explains the reason for rescinding or refusing the approval,

(2) Provides an opportunity to modify the marking, labeling, or

container so that it will no longer be false or misleading, and

(3) Advises the firm of its opportunity to submit a written

statement to answer the notification and to request a hearing with

respect to the merits or validity of FSIS's determination.

(c) Effective upon service of the notification in accordance with

Sec. 1.147 of the Uniform Rules of Practice (7 CFR 1.147), the use of

the marking, labeling, or container shall cease.

(d) If a hearing is requested, FSIS will initiate a complaint in

accordance with the Uniform Rules of Practice, 7 CFR, subtitle A, part

1, subpart H.

Sec. 500.16 Refusing or withdrawing inspection for applicants or

recipients unfit to engage in business.

If the Administrator has reason to believe that an applicant for

inspection services or recipient of inspection services is unfit to

engage in any business requiring inspection because of any of the

reasons specified in section 401 of the FMIA or section 18(a) of the

PPIA, inspection services will be refused or withdrawn in accordance

with the Uniform Rules of Practice, 7 CFR, subtitle A, part 1, subpart

H.

Done at Washington, DC on: January 5, 1998.

Thomas J. Billy,

Administrator.

[FR Doc. 98-573 Filed 1-9-98; 8:45 am]

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