Mexican Hass Avocado Import Program

DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection Service

7 CFR Part 319

[Docket No. 99-020-1]

Mexican Hass Avocado Import Program

AGENCY: Animal and Plant Health Inspection Service, USDA.

ACTION: Proposed rule.

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SUMMARY: We are proposing to amend our regulations governing the

importation of Hass avocados from Mexico to require handlers and

distributors to enter into compliance agreements with the Animal and

Plant Health Inspection Service. We would also amend the stickering

requirement for the avocados and add requirements regarding the

repackaging of the avocados after their entry into the United States.

These proposed amendments are necessary to ensure that distributors and

handlers are familiar with the distribution restrictions and other

requirements of the regulations and to strengthen the effectiveness of

the marking requirements used to identify the avocados and allow them

to be tracked back to their grove of origin. These proposed amendments

would serve to reinforce the existing safeguards of the avocado import

program.

DATES: We invite you to comment on this docket. We will consider all

comments that we receive by August 24, 1999.

ADDRESSES: Please send your comment and three copies to: Docket No. 99-

020-1, Regulatory Analysis and Development, PPD, APHIS, Suite 3C03,

4700 River Road Unit 118, Riverdale, MD 20737-1238. Please state that

your comment refers to Docket No. 99-020-1.

You may read any comments that we receive on this docket in our

reading room. The reading room is located in room 1141 of the USDA

South Building, 14th Street and Independence Avenue, SW., Washington,

DC. Normal reading room hours are 8 a.m. to 4:30 p.m., Monday through

Friday, except holidays. to be sure someone is there to help you please

call (202) 690-2817 before coming.

APHIS documents published in the Federal Register, and related

information, including the names of organizations and individuals who

have commented on APHIS rules, are available on the Internet at http://

www.aphis.usda.gov/ppd/rad/webrepor.html.

FOR FURTHER INFORMATION CONTACT: Ms. Donna West, Import Specialist,

Phytosanitary Issues Management Team, PPQ, APHIS, 4700 River Road Unit

140, Riverdale, MD 20737-1236; (301) 734-6799; e-mail:

Donna.L.W[email protected].

SUPPLEMENTARY INFORMATION:

Background

The regulations in ``Subpart--Fruits and Vegetables'' (7 CFR 319.56

through 319.56-8, referred to below as the regulations) prohibit or

restrict the importation of fruits and vegetables into the United

States from certain parts of the world to prevent the introduction and

dissemination of plant pests, including fruit flies, that are new to or

not widely distributed within the United States.

The regulations in Sec. 319.56-2ff allow fresh Hass avocado fruit

grown in approved orchards in approved municipalities in Michoacan,

Mexico, to be imported into certain areas of the United States subject

to certain conditions. Those conditions, which include pest surveys and

pest risk-reducing cultural practices, packinghouse procedures,

inspection and shipping procedures, and restrictions on the time of

year (November through February) that shipments may enter the United

States, are designed to reduce the risk of pest introduction to a

negligible level. Further, the regulations in Sec. 319.56-2ff limit the

distribution of the avocados to 19 northeastern States and the District

of Columbia, where climatic conditions preclude the establishment in

the United States of any of the exotic plant pests that may attack

avocados in Michoacan. Mexico. In this document, we are proposing to

make several changes to the regulations.

Compliance Agreements

The regulations in Sec. 319.56-2ff became effective in March 1997.

During the first shipping season (November 1997 through February 1998),

we found that one distributor had shipped Mexican Hass avocados to

Georgia, Iowa, Missouri, North Carolina, South Carolina, and Tennessee,

none of which are among the 19 approved States. In the second shipping

season (November 1998 through February 1999), we found that five other

distributors had allowed Mexican Hass avocados to be shipped those same

six States as well as to the non-approved States of Florida, Minnesota,

Mississippi, Nebraska, and South Dakota.

In order to help prevent recurrences of such unauthorized shipments

in future shipping seasons, we are proposing to amend the regulations

to require all handlers and distributors of Mexican Hass avocados to

enter into a compliance agreement with the Animal and Plant Health

Inspection Service (APHIS). The compliance agreement would serve both

as an educational tool to ensure that all handlers and distributors

have been fully informed about the limitations that the regulations

place on the movement of the avocados and as an enforcement tool that

would provide a greater measure of accountability for handlers or

distributors who may violate the distribution restrictions of the

regulations. This proposed compliance agreement requirement would be

added to the regulations in Sec. 319.56-2ff as a new paragraph (k),

``Compliance agreements.''

Specifically, proposed paragraph (k)(1) would state that any person

other than the person who received a permit to import the avocados (the

permittee) who moves or distributes Mexican Hass avocados following

their importation into the United States must enter into a compliance

agreement with APHIS. In that compliance agreement, the person moving

or distributing the avocados would have to acknowledge, and agree to

observe, the restrictions found in Sec. 319.56-2ff regarding the

movement of the avocados in the United States. Those restrictions, a

copy of which would be provided to the person entering into the

compliance agreement, are found in Sec. 319.56-2ff in paragraph (a),

``Shipping restrictions;'' paragraph (f), ``Ports;'' paragraph (g),

``Shipping areas;''

[[Page 34142]]

paragraph (h), ``Shipping requirements;'' and paragraph (i),

``Inspection;'' as well as in proposed new paragraph (j),

``Repackaging'' (which is explained later in this document) and

proposed paragraph (k), ``Compliance agreements.''

By requiring handlers and distributors to sign a compliance

agreement, we would be able to document that they have received a copy

of the regulations and have had those regulations explained to them.

This would effectively eliminate any uncertainty or misunderstanding

that they may have regarding their responsibilities under the

regulations. Paragraph (k)(1) would conclude by stating that compliance

agreements forms are available free of charge, from local offices of

Plant Protection and Quarantine, which are listed in local telephone

directories.

Proposed paragraph (k)(2) would state that the permittee would have

to ensure that any person to whom he or she released the avocados for

movement or distribution (i.e., a second-party handler) has entered

into a compliance agreement with APHIS. While the importers themselves

must acknowledge the requirements of the regulations before they

receive a permit to import Mexican Hass avocados, it is possible that a

second-party handler might fail to fully familiarize himself or herself

with the distribution limitations and other restrictions associated

with the Avocados. We believe requiring permittees to confirm that the

person to whom they are releasing the avocados for distribution has

entered into a compliance agreement with APHIS would ensure that

second-party handlers are made aware of their responsibilities under

the regulations. This proposed requirement would also be made a

condition of the permit that the permittee must obtain prior to

importing Mexican Hass avocados, and failure to observe the conditions

of a permit is grounds for its revocation. Therefore, paragraph (k)(2)

would also state that APHIS may revoke an import permit for the

remainder of the current shipping season if the permittee failed to

confirm that the second-party handler had entered into a compliance

agreement.

For the same reasons that we would address the transfer of avocados

from the permittee to a second-party handler, as described in the

previous paragraph, we are also proposing to require that any second-

party or subsequent handler who releases the avocados to another person

for movement or distribution must ensure that the person receiving the

avocados has entered into a compliance agreement with APHIS. This

proposed requirement would be stated in paragraph (k)(3). Again, the

compliance agreement would ensure that persons receiving the avocados

from second-party or subsequent handlers are made aware of their

responsibilities under the regulations. Further, the compliance

agreement would serve to establish a chain of custody that would

indicate at what point this proposed compliance agreement requirement

was disregarded. Because a compliance agreement would be required for

persons moving or distributing the avocados, paragraph (k)(3) would

also state that APHIS may revoke a second-party or subsequent handler's

compliance agreement for the remainder of the current shipping season

if that second-party or subsequent handler failed to confirm that the

person to whom he or she released the avocados had entered into a

compliance agreement.

Finally, in order to help prevent repeated violations of the

proposed compliance agreement requirement, paragraph (k)(4) would

provide that APHIS may deny an import permit application from, or

refuse to enter into a compliance agreement with, a person who has had

his or her import permit or compliance agreement revoked twice within

any 5-year period. This would prevent permittees or handlers who

repeatedly disregard or violate the compliance agreement requirement

from receiving or moving shipments of Mexican Hass avocados.

Stickers

The regulations in Sec. 319.56-2ff(c)(3)(vi) require, among other

things, that prior to being packed in boxes at the packinghouse in

Mexico, each avocado fruit must be labeled with a sticker that bears

the Sanidad Vegetal registration number of the packinghouse. This

requirement is intended to make it easier to identify Mexican-origin

avocados at terminal markets and presents an additional obstacle to

transshipment of the fruit to non-approved States.

It has come to our attention that some packinghouses in Mexico may

be using the same sticker required by the regulations for ``program

fruit'' (i.e., avocados that meet the requirements of Sec. 319.56-2ff

for export to the northeastern United States) on ``non-program fruit''

shipped to Canada or used for domestic consumption in Mexico. While

using the sticker for non-program fruit is not currently prohibited by

the regulations, we believe that such uses of the sticker dilute the

effectiveness of the stickers as a tool for identifying Mexican

avocados in the United States and for differentiating program fruit

from non-program fruit that may have been smuggled into the United

States.

Therefore, we are proposing to amend Sec. 319.56-2ff(c)(3)(vi) to

require that the stickers used for program fruit not only bear the

Sanidad Vegetal registration number of the packinghouse, but that they

also bear the letters ``M/US'' after that number, and that those

stickers be used only for fruit produced in accordance with

Sec. 319.56-2ff for export to the United States. These proposed

amendments to the stickering requirement would ensure that the stickers

will serve their intended purpose of making it easier to identify

Mexican-origin avocados at terminal markets and would further allow us

to differentiate between program fruit and non-program fruit that may

have been smuggled into the United States.

Repackaging

The regulations in Sec. 319.56-2ff(c)(3)(vii) require that, at the

packinghouse in Mexico, the avocados must be packed in clean, new

boxes, and the boxes must be clearly marked with the identity of the

grower, packinghouse, and exporter, and the statement ``Distribution

limited to the following States: CT, DC, DE, IL, IN, KY, ME, MD, MA,

MI, NH, NJ, NY, OH, PA, RI, VA, VT, WV, and WI.'' This requirement

ensures that the avocados can be traced back to their grove of origin

in the event that pests are detected at any time after the avocados are

placed in boxes at the packinghouse.

We acknowledge that there may be instances where the avocados may

have to be packed in new boxes after their entry into the United States

due to damage to the original shipping box or some other legitimate

reason. It is also possible that a person may attempt to conceal the

origin of the avocados by repackaging them into unmarked boxes or

removing the stickers that are required by Sec. 319.56-2ff(c)(3)(vi).

The regulations, however, currently do not address the removal of

stickers or the repackaging of avocados after their arrival in the

United States.

Therefore, we are proposing to add a new paragraph (j) to

Sec. 319.56-2ff that would clearly state that if any avocados are

removed from their original shipping boxes and repackaged, the stickers

may not be removed or obscured and the new boxes must be clearly marked

with the same information that must be placed on the original boxes at

the packinghouse. Adding these provisions to the regulations would help

ensure these identifying measures would be

[[Page 34143]]

maintained in the event that repackaging became necessary, thus

preserving the important information regarding the identity and origin

of the avocados that those measures provide.

Executive Order 12866 and Regulatory Flexibility Act

This proposed rule has been reviewed under Executive Order 12866.

The rule has been determined to be not significant for the purposes of

Executive Order 12866 and, therefore, has not been reviewed by the

Office of Management and Budget.

This proposed rule would amend our regulations governing the

importation of Hass avocados from Mexico to require handlers and

distributors to enter into compliance agreements with APHIS. This

proposed rule would also amend the stickering requirement for the

avocados and add requirements regarding the repackaging of the avocados

after their entry into the United States. These proposed amendments

would ensure that distributors and handlers are familiar with the

distribution restrictions and other requirements of the regulations and

would strengthen the effectiveness of the marking requirements used to

identify the avocados and allow them to be traced back to their grove

of origin.

During the first shipping season for Mexican Hass avocados

(November 1997 through February 1998), Mexico exported 13.296 million

pounds of fresh avocados to the northeastern United States (U.S.

Department of Agriculture, Foreign Agricultural Service, GAIN Report

No. MX8140, November 24, 1998). During the second shipping season

(November 1998 through February 1999), Mexico exported approximately 22

million pounds of fresh avocados to the northeastern United States.

Although it was anticipated that the importation of fresh Hass

avocados from Mexico into the northeastern United States would result

in lower prices for consumers and losses for domestic avocado

producers, there has, to date, been little or no price change. The

average wholesale price for avocados in the approved 19 northeastern

States and the District of Columbia before the first shipping season

began in November 1997 was $1.47 per pound, while after the shipping

season began, the average wholesale price was $1.60 per pound. For the

non-approved States, the average wholesale prices were $1.46 before

November 1997 and $1.57 after the first shipping season began. (The

wholesale prices in the approved States are based on averages in

Baltimore, Boston, Chicago, Detroit, New York, and Philadelphia; the

wholesale prices for the non-approved States are based on averages in

Atlanta, Dallas, Los Angeles, Miami, San Francisco, and Seattle.) There

was no statistically significant difference between the wholesale

prices in the approved States and the non-approved States before or

after Mexican Hass avocados entered the domestic market. It should be

noted that the average wholesale prices for fresh avocados in Mexico

were only about $0.33 and $0.32 per pound in 1997 and 1998,

respectively.

As discussed in the background section of this proposed rule,

compliance agreements are available from APHIS free of charge and the

stickering of individual avocados in Mexico is already required under

the regulations. Therefore, the only aspect of this proposed rule that

could be expected to result in additional costs for any U.S. entities,

large or small, would be the proposed requirement for the marking of

new boxes in cases where the avocados are repackaged after their entry

into the United States.

According to industry sources, the cost of the current box marking

and fruit stickering requirements of the regulations is approximately

$0.06 per pound. This cost is borne at the Mexican production/export

end of the Hass avocado export program. If 20 percent of all shipments

had to be repackaged following their arrival in the United States due

to damage to original shipping boxes or for other reasons, the proposed

requirement for the marking of new boxes could result in additional

costs to U.S. importers or distributors of approximately $160,000 to

$264,000. This estimate was arrived at using 20 percent of the total

volume of Mexican Hass avocados shipped to the northeastern United

States during the two export seasons of 1997-1998 (13.296 million

pounds x $0.06 x 0.2=$159,552) and 1998-1999 (22 million pounds x

$0.06 x 0.2=$264,000). However, because the $0.06 figure used includes

the costs of stickering as well as box marking, it is likely that the

costs to U.S. importers or distributors of marking new boxes in the

United States would actually be less than that estimate. Since, as

noted above, the price spread between domestic and Mexican wholesale

prices is so large, U.S. importers and distributors may be able to

absorb any additional costs resulting from the proposed requirement for

marking new boxes without passing those costs on to consumers.

Under these circumstances, the Administrator of the Animal and

Plant Health Inspection Service has determined that this action would

not have a significant economic impact on a substantial number of small

entities.

Executive Order 12988

This proposed rule has been reviewed under Executive Order 12988,

Civil Justice Reform. If this proposed rule is adopted: (1) All State

and local laws and regulations that are inconsistent with this rule

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

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

parties may file suit in court challenging this rule.

Paperwork Reduction Act

In accordance with section 3507(d) of the Paperwork Reduction Act

of 1995 (44 U.S.C. 3501 et seq.), the information collection or

recordkeeping requirements included in this proposed rule have been

submitted for approval to the Office of Management and Budget (OMB).

Please send written comments to the Office of Information and

Regulatory Affairs, OMB, Attention: Desk Officer for APHIS, Washington,

DC 20503. Please state that your comments refer to Docket No. 99-020-1.

Please send a copy of your comments to: (1) Docket No. 99-020-1,

Regulatory Analysis and Development, PPD, APHIS, suite 3C03, 4700 River

Road Unit 118, Riverdale, MD 20737-1238, and (2) Clearance Officer,

OCIO, USDA, room 404-W, 14th Street and Independence Avenue, SW.,

Washington, DC 20250. A comment to OMB is best assured of having its

full effect if OMB receives it within 30 days of publication of this

proposed rule.

Our regulations currently allow fresh Hass avocado fruit grown in

approved orchards in Michoacan, Mexico, to be imported into the United

States under certain conditions. In this document, we are proposing to

amend our regulations governing the importation of Hass avocados from

Mexico to require handlers and distributors to enter into compliance

agreements with APHIS. We are also proposing to amend the existing

stickering requirement for the avocados and to add requirements

regarding the marking of new boxes when avocados are repackaged after

their entry into the United States.

These proposed amendments would require the use of several

information collection procedures, including a compliance agreement,

enhanced product identification, and additional container marking

requirements. We are asking OMB to approve our use of these information

collections in connection with our efforts to ensure that fresh Hass

avocados from Mexico pose a negligible risk of introducing exotic

insect pests into the United States.

[[Page 34144]]

We are soliciting comments from the public (as well as affected

agencies) concerning our proposed information collection and

recordkeeping requirements. These comments will help us:

(1) Evaluate whether the proposed information collection is

necessary for the proper performance of our agency's functions,

including whether the information will have practical utility;

(2) Evaluate the accuracy of our estimate of the burden of the

proposed information collection, including the validity of the

methodology and assumptions used;

(3) Enhance the quality, utility, and clarity of the information to

be collected; and

(4) Minimize the burden of the information collection on those who

are to respond (such as through the use of appropriate automated,

electronic, mechanical, or other technological collection techniques or

other forms of information technology, e.g., permitting electronic

submission of responses).

Estimate of burden: Public reporting burden for this collection of

information is estimated to average 1.195 hours per response.

Respondents: Packinghouse owner/operators in Mexico and importers,

shippers, distributors, and handlers of fresh Hass avocados imported

into the United States.

Estimated annual number of respondents: 210.

Estimated annual number of responses per respondent: 1.195.

Estimated annual number of responses: 210.

Estimated total annual burden on respondents: 251 hours. (Due to

rounding, the total annual burden hours may not equal the product of

the annual number of responses multiplied by the average reporting

burden per response.)

Copies of this information collection can be obtained from:

Clearance Officer, OCIO, USDA, room 404-W, 14th Street and Independence

Avenue, SW., Washington, DC 20250.

List of Subjects in 7 CFR Part 319

Bees, Coffee, Cotton, Fruits, Honey, Imports, Logs, Nursery Stock,

Plant diseases and pests, Quarantine, Reporting and recordkeeping

requirements, Rice, Vegetables.

Accordingly, we propose to amend 7 CFR part 319 as follows:

PART 319--FOREIGN QUARANTINE NOTICES

1. The authority citation for part 319 would continue to read as

follows:

Authority: 7 U.S.C. 150dd, 150ee, 150ff, 151-167, 450, 2803, and

2809; 21 U.S.C. 136 and 136a; 7 CFR 2.22, 2.80, and 371.2(c).

2. In Sec. 319.56-2ff, paragraph (c)(3)(vi) would be revised and

new paragraphs (j) and (k) would be added to read as follows:

Sec. 319.56-ff Administrative instructions governing movement of Hass

avocados from Mexico to the Northeastern United States.

* * * * *

(c) * * *

(3) * * *

(vi) Prior to being packed in boxes, each avocado fruit must be

cleaned of all stems, leaves, and other portions of plants and labeled

with a sticker that bears the Sanidad Vegetal registration number of

the packinghouse followed by the letters ``M/US.'' The stickers may be

used only for fruit produced in accordance with this section for export

to the United States.

* * * * *

(j) Repackaging. If any avocados are removed from their original

shipping boxes and repackaged, the stickers required by paragraph

(c)(3)(vi) of this section may not be removed or obscured and the new

boxes must be clearly marked with all the information required by

paragraph (c)(3)(vii) of this section.

(k) Compliance agreements. (1) Any person other than the permittee

(i.e., a second-party or subsequent handler) who moves or distributes

the avocados following their importation into the United States must

enter into a compliance agreement with APHIS. In the compliance

agreement, the person must acknowledge, and agree to observe, the

requirements of paragraph (a) and paragraphs (f) through (k) of this

section. Compliance agreement forms are available, free of charge, from

local offices of Plant Protection and Quarantine, which are listed in

local telephone directories.

(2) Before transferring the avocados to any person (i.e., a second-

party handler) for movement or distribution, the permittee must confirm

that the second-party handler has entered into a compliance agreement

with APHIS as required by paragraph (k)(1) of this section. If the

permittee transfers the avocados to a second-party handler who has not

entered into a compliance agreement, APHIS may revoke the permittee's

import permit for the remainder of the current shipping season.

(3) Any second-party or subsequent handler who transfers the

avocados to another person for movement or distribution must confirm

that the person receiving the avocados has entered into a compliance

agreement with APHIS as required by paragraph (k)(1) of this section.

If the second-party or subsequent handler transfers the avocados to a

person who has not entered into a compliance agreement, APHIS may

revoke the handler's compliance agreement for the remainder of the

current shipping season.

(4) Action on repeat violators. APHIS may deny an application for

an import permit from, or refuse to enter into a compliance agreement

with, any person who has had his or her import permit or compliance

agreement revoked under paragraph (k)(2) or (k)(3) of this section

twice within any 5-year period.

Done in Washington, DC, this 21st day of June 1999.

Joan M. Arnoldi,

Acting Administrator, Animal and Plant Health Inspection Service.

[FR Doc. 99-16173 Filed 6-24-99; 8:45 am]

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