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| Final Rule Table of Contents
Final Rule; correction Federal Register; February 23, 2005 |
See also: |
[Federal Register: December 9, 2004 (Volume 69, Number 236)]
[Rules and Regulations]
[Page 71561-71655]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr09de04-25]
[[Page 71561]]
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Part IV
Department of Health and Human Services
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Food and Drug Administration
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21 CFR Parts 1 and 11
Establishment and Maintenance of Records Under the Public Health
Security and Bioterrorism Preparedness and Response Act of 2002;
Establishment and Maintenance of Records for Foods; Notice of Public
Meeting; Availability of Draft Guidance for Records Access Authority;
Final Rules and Notice
[[Page 71562]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Food and Drug Administration
21 CFR Parts 1 and 11
[Docket No. 2002N-0277]
RIN 0910-AC39
Establishment and Maintenance of Records Under the Public Health
Security and Bioterrorism Preparedness and Response Act of 2002
AGENCY: Food and Drug Administration, HHS.
ACTION: Final rule.
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SUMMARY: The Food and Drug Administration (FDA) is issuing a final
regulation that requires the establishment and maintenance of records
by persons who manufacture, process, pack, transport, distribute,
receive, hold, or import food in the United States. Such records are to
allow for the identification of the immediate previous sources and
immediate subsequent recipients of food. The final rule implements the
Public Health Security and Bioterrorism Preparedness and Response Act
of 2002 (the Bioterrorism Act), and is necessary to help address
credible threats of serious adverse health consequences or death to
humans or animals. The requirement to establish and maintain records is
one of several tools that will help improve FDA's ability to respond
to, and further contain, threats of serious adverse health consequences
or death to humans or animals from accidental or deliberate
contamination of food. In the event of an outbreak of foodborne
illness, such information will help FDA and other authorities determine
the source and cause of the event. In addition, the information will
improve FDA's ability to quickly notify the consumers and/or facilities
that might be affected by the outbreak.
DATES: Effective Date: This final rule is effective February 7, 2005.
Compliance Dates: The compliance date is December 9, 2005; except
that for small businesses employing fewer than 500, but more than 10
full-time equivalent employees, the compliance date is June 9, 2005;
and except that for very small businesses that employ 10 or fewer full-
time equivalent employees, the compliance date is December 11, 2006.
FOR FURTHER INFORMATION CONTACT: Nega Beru, Center for Food Safety and
Applied Nutrition (HFS-305), Food and Drug Administration, 5100 Paint
Branch Pkwy., College Park, MD 20740, 301-436-1400.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background and Legal Authority
II. Highlights of the Final Rule and Summary of the Significant Changes
Made to the Proposed Rule
A. Highlights of This Final Rule
B. Significant Changes FDA Made to the Proposed Rule
III. Comments on the Proposed Rule
A. General Comments
B. Foreign Trade Issues
C. Comments on Who is Subject to This Subpart? (Proposed Sec.
1.326)
D. Comments on Who is Excluded From All or Part of the Regulations
in this Subpart? (Proposed Sec. 1.327)
E. Comments on What Definitions Apply to this Subpart? (Proposed
Sec. 1.328)
F. Comments on Do Other Statutory Provisions and Regulations Apply?
(Proposed Sec. 1.329)
G. Comments on Can Existing Records Satisfy the Requirements of
this Subpart? (Proposed Sec. 1.330)
H. Comments on What Information is Required in the Records You Must
Establish and Maintain to Identify the Nontransporter and Transporter
Immediate Previous Source and Immediate Subsequent Recipients?
(Proposed Sec. Sec. 1.337 and 1.345)
I. Comments on Who is Required to Establish and Maintain Records
for Tracing the Transportation of All Food? (Proposed Sec. 1.351)
J. Comments on What Information is Required in the Transportation
Records? (Proposed Sec. 1.352)
K. Comments on What Are the Record Retention Requirements?
(Proposed Sec. 1.360)
L. Comments on What Are the Record Availability Requirements?
(Proposed Sec. 1.361)
M. Comments on What Records Are Excluded From this Subpart?
(Proposed Sec. 1.362)
N. Comments on What Are the Consequences of Failing to Establish
and Maintain Records or Make Them Available to FDA as Required By This
Subpart? (Proposed Sec. 1.363)
O. Comments on What Are the Compliance Dates for This Subpart?
(Proposed Sec. 1.368)
IV. Analysis of Economic Impacts--Final Regulatory Impact Analysis
A. Summary of the Costs and Benefits of the Final Rule
B. Description of Proposed Rule
C. General Comments
D. The Tradeoff Between Costs and Risk Reduction
E. Estimating the Benefits
F. Costs
G. Summary of the Costs and Benefits of the Final Rule and Policy
V. Final Regulatory Flexibility Analysis
VI. Unfunded Mandates
VII. SBREFA
VIII. Paperwork Reduction Act of 1995
IX. Analysis of Environmental Impact
X. Federalism
XI. References
I. Background and Legal Authority
The events of September 11, 2001, have highlighted the need to
enhance the security of the infrastructure of the United States,
including the food supply. Congress responded by enacting the
Bioterrorism Act (Public Law 107-188), which was signed into law on
June 12, 2002. The Bioterrorism Act includes a provision in title III
(Protecting Safety and Security of Food and Drug Supply), subtitle A--
Protection of Food Supply, section 306, which amends the Federal Food,
Drug, and Cosmetic Act (the FD&C Act) by adding section 414,
Maintenance and Inspection of Records (21 U.S.C. 350c). (In the
regulation itself, which is codified in title 21 of the Code of Federal
Regulations, the Federal Food, Drug, and Cosmetic Act is referred to as
``the act.'' Thus, when the regulation is quoted in this preamble, the
term ``the act'' will be used to refer to the Federal Food, Drug, and
Cosmetic Act. However, in this preamble, we refer to the Federal Food,
Drug, and Cosmetic Act as ``the FD&C Act'' to distinguish it from the
Bioterrorism Act.) Section 414(b) of the FD&C Act provides, in part,
that the Secretary of Health and Human Services (the Secretary), may by
regulation establish requirements regarding the establishment and
maintenance, for not longer than 2 years, of records by persons
(excluding farms and restaurants) who manufacture, process, pack,
transport, distribute, receive, hold, or import food. The records that
are required to be kept by these regulations are those needed by the
Secretary for inspection to allow the Secretary to identify the
immediate previous sources and immediate subsequent recipients of food,
including its packaging, to address credible threats of serious adverse
health consequences or death to humans or animals. Section 306(d) of
the Bioterrorism Act provides that the Secretary ``shall'' issue
regulations establishing recordkeeping requirements under section
414(b) of the FD&C Act no later than 18 months after enactment of the
Bioterrorism Act, that is, by December 12, 2003.
In addition, the Bioterrorism Act adds a new section 414(a) to the
FD&C Act
[[Page 71563]]
that provides records inspection authority to FDA. Section 414(a) of
the FD&C Act provides that, if the Secretary has a reasonable belief
that an article of food is adulterated and presents a threat of serious
adverse health consequences or death to humans or animals, persons who
manufacture, process, pack, distribute, receive, hold, or import food
must provide access to records related to the food that are needed to
assist the Secretary in determining whether the food is adulterated and
presents a threat of serious adverse health consequences or death to
humans or animals.
Section 306 of the Bioterrorism Act also amends section 704(a) of
the FD&C Act (21 U.S.C. 374(a)) to authorize FDA inspections of all
records and other information described in section 414 of the FD&C Act,
when the Secretary has a reasonable belief that an article of food is
adulterated and presents a threat of serious adverse health
consequences or death to humans or animals.
In addition, section 306(c) of the Bioterrorism Act amends section
301 of the FD&C Act (21 U.S.C. 331) to make it a prohibited act to
refuse to permit access to, or copying of, any record as required by
section 414 or 704(a) of the FD&C Act; or to fail to establish or
maintain any record as required by section 414(b) of the FD&C Act; or
to refuse to permit access to, or verification or copying of, any such
required record; or for any person to use to his own advantage, or to
reveal, other than to the Secretary or officers or employees of the
Department of Health and Human Services, or to the courts when relevant
in any judicial proceeding under the FD&C Act, any information acquired
under authority of section 414 of the FD&C Act.
To implement these provisions, on May 9, 2003 (68 FR 25188), FDA
issued a proposed rule to require the establishment and maintenance of
records to identify the immediate previous sources and immediate
subsequent recipients of food. In addition to section 306 of the
Bioterrorism Act, which amends the FD&C Act as described previously,
FDA is relying on section 701(a) of the FD&C Act (21 U.S.C. 371(a)) in
issuing this final rule. Section 701(a) authorizes the agency to issue
regulations for the efficient enforcement of the FD&C Act.
II. Highlights of the Final Rule and Summary of the Significant Changes
Made to the Proposed Rule
A. Highlights of this Final Rule
The highlights of this final rule are described briefly in the
following paragraphs, and are discussed in more detail later in the
preamble of this document:
• Persons who manufacture, process, pack, transport,
distribute, receive, hold, or import food in the United States are
subject to the regulations in part 1 (21 CFR part 1) subpart J of this
final rule (i.e., recordkeeping and access requirements);
• The following persons or facilities are excluded from all
of the regulations in subpart J of this final rule: Farms; restaurants;
those performing covered activities when the food is subject to the
exclusive jurisdiction of the U.S. Department of Agriculture (USDA)
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.); and
foreign persons, except foreign persons who transport food in the
United States.
• The following persons or facilities are excluded from the
requirement to establish and maintain records in Sec. Sec. 1.337 and
1.345 of subpart J of this final rule, but are subject to the record
availability requirements in Sec. Sec. 1.361 and 1.363 for existing
records: (1) Fishing vessels not engaged in processing as defined in
Sec. 123.3(k) (21 CFR part 123.3(k)); (2) retail food establishments
that employ 10 or fewer full-time equivalent employees; (3) nonprofit
food establishments that prepare or serve food directly to the consumer
or otherwise provide food or meals for consumption by humans or animals
in the United States; and (4) persons who manufacture, process, pack,
transport, distribute, receive, hold, or import food contact substances
other than the finished container that directly contacts the food.
• Persons who manufacture, process, pack, transport,
distribute, receive, hold, or import food are subject to Sec. Sec.
1.361 and 1.363 with respect to its packaging (the outer packaging of
food that bears the label and does not contact the food). All other
persons who manufacture, process, pack, transport, distribute, receive,
hold, or import packaging are excluded from all of the requirements of
this subpart J of this final rule.
• Persons who place food directly in contact with its
finished container are subject to all of the requirements of subpart J
of this final rule as to the finished container that directly contacts
that food. All other persons who manufacture, process, pack, transport,
distribute, receive, hold, or import the finished container that
directly contacts the food are excluded from the requirements of
subpart J of this final rule as to the finished container, except
Sec. Sec. 1.361 and 1.363.
• Persons who distribute food directly to consumers are
excluded from the requirement in Sec. 1.345 to establish and maintain
records to identify the immediate subsequent recipients as to those
transactions. The term ``consumers'' does not include businesses.
• Persons who operate retail food establishments that
distribute food to persons who are not consumers are subject to all of
the requirements in subpart J of this final rule. However, the
requirements in Sec. 1.345 to establish and maintain records to
identify the nontransporter and transporter immediate subsequent
recipients that are not consumers applies as to those transactions only
to the extent the information is reasonably available.
• Persons who manufacture, process, pack, transport,
distribute, receive, hold, or import food for personal consumption are
excluded from all of the requirements of subpart J of this final rule.
• Persons who receive or hold food on behalf of specific
individual consumers and who are not also parties to the transaction
and who are not in the business of distributing food are excluded from
all of the requirements of subpart J of this final rule.
• The regulations in subpart J of this final rule do not
require duplication of existing records if those records contain all of
the information required by the subpart. Furthermore, persons can
supplement existing records with any new information required by this
final rule instead of creating an entirely new record containing both
existing and new information.
• Persons who manufacture, process, pack, distribute,
receive, hold, or import food in the United States must establish and
maintain the following records to identify the immediate previous
sources and immediate subsequent recipients for all food they receive
and release, unless otherwise excluded from the requirements of subpart
J of this final rule:
• Name, address, telephone number and, if available, fax
number, and e-mail address of the immediate previous source and
subsequent recipient;
• Adequate description;
• Date received or released;
• For persons who manufacturer, process, or pack food, the
lot or code number or other identifier;
• Quantity and how the food is packaged; and
• Name, address, telephone number and, if available, fax
number, and e-mail
[[Page 71564]]
address of the transporter who transported the food to and from you.
• Persons who have possession, custody, or control of food
in the United States for the sole purpose of transporting the food, or
foreign persons who transport food in the United States, regardless of
whether they have possession, custody, or control of the food for the
sole purpose of transporting that food (transporters), can meet the
requirements of subpart J of this final rule by:
(1) Establishing and maintaining the records listed in Sec.
1.352(a); or
(2) Establishing and maintaining specified information that is in
the records required of roadway interstate transporters by the
Department of Transportation's (DOT's) Federal Motor Carrier Safety
Administration (FMCSA) contained in 49 CFR 373.101 and 373.103 as of
the date of publication of this final rule; or
(3) Establishing and maintaining specified information that is in
the records required of rail and water interstate transporters by the
DOT's Surface Transportation Board (STB) contained in 49 CFR 1035.1 and
1035.2 as of the date of publication of this rule; or
(4) Establishing and maintaining specified information that is in
the records required of international air transporters on air waybills
by the Warsaw Convention as Amended at the Hague, 1995 and by Protocol
No. 4 of Montreal, 1975 (Warsaw Convention); or
(5) Entering into an agreement with a nontransporter immediate
previous source (if located in the United States) or immediate
subsequent recipient (if located in the United States) to establish,
maintain, or establish and maintain, the required records in options 1
or 2 of the previous paragraphs. The agreement must contain certain
elements specified in Sec. 1.352(e).
• If you are a nontransporter, you must retain for 6 months
after the dates you receive and release the food all required records
for any food for which a significant risk of spoilage, loss of value,
or loss of palatability occurs within 60 days after the date you
receive or release the food.
• If you are a nontransporter, you must retain for 1 year
after the dates you receive and release the food all required records
for any food for which a significant risk of spoilage, loss of value,
or loss of palatability occurs only after a minimum of 60 days, but
within 6 months, after the date you receive or release the food.
• If you are a nontransporter, you must retain for 2 years
after the dates you receive and release the food all required records
for any food for which a significant risk of spoilage, loss of value,
or loss of palatability does not occur sooner than 6 months after the
date you receive or release the food, including foods preserved by
freezing, dehydrating, or being placed in a hermetically sealed
container.
• If you are a nontransporter, you must retain for 1 year
after the dates you receive and release the food all required records
for animal food, including pet food.
• Transporters of food (or specified persons who agree to
establish and maintain required records under agreements with
transporters) in the United States must retain records for 6 months for
any food having a significant risk of spoilage, loss of value, or loss
of palatability within 60 days after the date the transporter receives
or releases the food.
• Transporters of food (or specified persons who agree
to establish and maintain required records under agreements with
transporters) in the United States must retain records for 1 year for
any food having a significant risk of spoilage, loss of value, or loss
of palatability only after a minimum of 60 days after the date the
transporter receives or releases the food.
• Records must be made available as soon as possible, not to
exceed 24 hours from the time of receipt of the official request.
• Failure to establish or maintain records or refusal to
permit access to or verification or copying of any record is a
prohibited act under section 301 of the FD&C Act.
• The compliance date for the records establishment and
maintenance requirements is December 9, 2005, except that the
compliance date for small businesses employing fewer that 500, but more
than 10 full-time equivalent employees is June 9, 2005, and the
compliance date for very small businesses that employ 10 or fewer full-
time equivalent employees is December 11, 2006.
B. Significant Changes FDA Made to the Proposed Rule
FDA made the following significant changes to the proposed rule:
• All foreign persons, except foreign persons who transport
food in the United States, are excluded from all of the requirements in
subpart J of this final rule. A foreign person transporting food in the
United States is subject to the requirements for transporters in the
subpart.
• Persons who manufacture, process, pack, transport,
distribute, receive, hold, or import food are subject to Sec. Sec.
1.361 and 1.363 with respect to its packaging (the outer packaging of
food that bears the label and does not contact the food). All other
persons who manufacture, process, pack, transport, distribute, receive,
hold, or import packaging are excluded from all of the requirements of
subpart J of this final rule. Persons who manufacture, process, pack,
transport, distribute, receive, hold, or import food contact substances
other than the finished container that directly contacts the food are
excluded from all of the requirements of subpart J, except Sec. Sec.
1.361 and 1.363.
• Persons who place food directly in contact with its
finished container are subject to all of the requirements of subpart J
of this final rule as to the finished container that directly contacts
that food. All other persons who manufacture, process, pack, transport,
distribute, receive, hold, or import the finished container that
directly contacts the food are excluded from the requirements of
subpart J as to the finished container, except Sec. Sec. 1.361 and
1.363.
• Persons who receive or hold food on behalf of specific
individual consumers and who are not also parties to the transaction
and who are not in the business of distributing food are excluded from
all of the requirements of subpart J.
• Transporters can meet their obligation to establish and
maintain records in the following ways: (1) Keeping the records listed
in Sec. 1.352(a); (2) keeping the records listed in Sec. 1.352(b),
which contain information also currently required of roadway interstate
transporters under the FMCSA regulations as of the date of publication
of this final rule; (3) keeping the records listed in Sec. 1.352(c),
which contain information also currently required of rail and water
interstate transporters under the STB regulations as of the date of
publication of this final rule; (4) keeping the records listed in Sec.
1.352(d), which contain information also currently required of
international air transporters on air waybills under the Warsaw
Convention; or (5) entering into an agreement with a nontransporter
immediate previous source in the United States or a nontransporter
immediate subsequent recipient in the United States to keep records for
them. The agreement must contain certain elements specified in Sec.
1.352(c). Intrastate transporters must also establish and maintain
records under this final rule and can meet this obligation by complying
with either Sec. 1.352(a), (b), (c), (d), or (e).
• Foreign persons who transport food in the United States,
whether or not
[[Page 71565]]
they have possession, custody, or control of the food for the sole
purpose of transporting, must comply with Sec. 1.352 of subpart J of
this final rule.
• The exclusion for pet food not subject to the
recordkeeping provisions of the animal proteins prohibited in ruminant
feed regulation (BSE rule) (62 FR 30935, June 5, 1997) has been
deleted.
• The definition of ``farm'' now states that washing,
trimming of outer leaves, and cooling produce are part of harvesting.
• The definition of ``farm'' now includes facilities that
pack or hold food, provided that all food used in such activities is
grown, raised, or consumed on that farm or another farm under the same
ownership.
• ``Holding'' has been defined and means ``storage of
food.'' Holding facilities include warehouses, cold storage facilities,
storage silos, grain elevators, and liquid storage tanks.
• ``Packaging'' has been defined and means ``the outer
packaging of food that bears the label and does not contact the food.
Packaging does not include food contact substances as they are defined
in section 409(h)(6) of the FD&C Act (21 U.S.C. 348(h)(6)).''
• Recipe has been defined to mean the formula, including
ingredients, quantities, and instructions, necessary to manufacture a
food product. Because a recipe must have all three elements, a list of
the ingredients used to manufacture a product without quantity
information and manufacturing instructions is not a recipe.
• The partial exclusion for retail food establishments has
been replaced with a partial exclusion for persons who distribute food
directly to consumers. Persons who distribute food directly to
consumers are excluded from establishing and maintaining records
required by Sec. 1.345 to identify the nontransporter and transporter
immediate subsequent recipients as to those transactions. Persons who
distribute food to businesses must establish and maintain records to
identify the nontransporter and transporter immediate subsequent
recipients to the extent that information is reasonably available, for
example when the purchaser has an established commercial account.
• The exclusion for retail facilities that are located in
the same general physical location as a farm has been replaced with an
exclusion for all retail food establishments that employ 10 or fewer
full-time equivalent employees.
• An exclusion has been added for nonprofit food
establishments.
• ``Nonprofit food establishment'' has been defined and
means:
* * * a charitable entity that prepares or serves food directly
to the consumer or otherwise provides food or meals for consumption
by humans or animals in the United States. The term includes central
food banks, soup kitchens, and nonprofit food delivery services. To
be considered a nonprofit food establishment, the establishment must
meet the terms of section 501(c)(3) of the U.S. Internal Revenue
Code (26 U.S.C. 501(c)(3)).
• The requirement to record a ``responsible individual''
when identifying the immediate previous source, immediate subsequent
recipient, and transporters has been deleted.
• The requirement to record ``lot or code number or other
identifier'' has been deleted for all covered entities, except persons
who manufacture, process, or pack food.
• The definition of perishable food has been deleted.
• The record retention periods for nontransporters have been
changed to: (1) 6 months for food for which a significant risk or
spoilage, loss of value, or loss of palatability occurs within 60 days
after the date you receive or release the food; (2) 1 year for food for
which a significant risk of spoilage, loss of value, or loss of
palatability occurs only after a minimum of 60 days, but within 6
months, after the date you receive or release the food; and (3) 2 years
for food for which a significant risk of spoilage, loss of value, or
loss of palatability does not occur sooner than 6 months after the date
you receive or release the food, including foods preserved by freezing,
dehydrating, or being placed in a hermetically sealed container.
• The record retention periods for transporters (or
specified persons who agree to establish and maintain required records
under agreements with transporters) have been changed to 6 months for
any food having a significant risk or spoilage, loss of value, or loss
of palatability within 60 days after the date the food is received or
released and 1 year for any food having a significant risk or spoilage,
loss of value, or loss of palatability only after a minimum of 60 days
after the date the food is received or released.
• The record availability requirements have been changed
from 4 hours/8 hours to ``as soon as possible, not to exceed 24 hours
from the time of receipt of the official request.''
• The compliance date for these regulations has changed to
December 9, 2005. Small businesses have June 9, 2005, of this final
rule to come into compliance with these regulations, and very small
businesses have December 11, 2006, of this final rule to come into
compliance with these regulations.
• The qualifying language ``food intended for consumption in
the United States'' has been removed from this final rule to ensure
that all persons that manufacture, process, pack, transport,
distribute, receive, hold, or import food in the United States that is
intended for consumption are subject to this final rule unless
otherwise exempt.
III. Comments on the Proposed Rule
FDA received approximately 212 timely submissions in response to
the proposed rule, which raised approximately 220 major issues. To make
it easier to identify comments and FDA's responses to the comments, the
word ``Comment'' will appear in parentheses before the description of
the comment, and the word ``Response'' will appear in parentheses
before FDA's response. FDA has also numbered each comment to make it
easier to identify a particular comment. The number assigned to each
comment is purely for organizational purposes and does not signify the
comment's value or importance or the order in which it was submitted.
A. General Comments
(Comment 1) Some comments state that it would be beneficial for the
agency to provide the food industry with a model form that could be
used to record all the required information, with the option for the
industry to use this form or established recordkeeping systems. One
comment requests that the agency develop and provide respective
freeware that could be available as a compact disc (CD) or downloaded
from the FDA Web site well in advance of the compliance date of the
final rule. A few comments request that the regulations make clear that
the model form is guidance and is not mandatory. One comment suggests
that as a way to show that the model form is guidance, the agency
should place the model form in an appendix to the regulations.
Several comments object to the inclusion of a model form in the
regulations. The comments oppose using any ``one-size fits all''
generic form as an example or requirement. The comments suggest that
affected businesses should decide the format in which the required
records should be kept as dictated by specific business practices. The
comments express concern that example forms might become informal
requirements out in the field even though originally only meant as
guidance.
One comment recommends that the agency provide further examples of
[[Page 71566]]
scenarios, rather than model forms, where records would be in
compliance and noncompliance with the final regulations.
In addition, several comments state that most food companies
currently maintain the chain-of-distribution information that is
required by these regulations. However, the diversity and complexity of
the food industry means that the information is maintained in many
different ways and formats, ranging from computerized records systems
to file folders of paper records. The recordkeeping systems are
designed to provide the necessary information to remove food from the
market and prevent more food presenting the same risk from entering the
market. The comments state that the regulations should not prescribe
any specific manner or form of maintaining the information.
(Response) The provisions describe the specific information a
covered entity must keep, but do not specify the form or type of system
in which those records must be maintained. As stated in both the
proposed and final Sec. 1.330, these provisions do not require
duplication of existing records if those records contain all of the
information required by subpart J of this final rule. If a person
subject to these provisions keeps records of all of the information as
required by subpart J in compliance with other Federal, State, or local
regulations, or for any other reason, e.g., as a result of its own
business practices, then those records may be used to meet these
requirements. Such records may include, but are not limited to,
purchase orders, bills of lading, invoices, and shipping documents.
Moreover, entities do not have to keep all of the information required
by this final rule in one set of records. If they have records
containing some of the required information, they may keep those
existing records and keep, either separately or in a combined form, any
new data required by this final rule. There is no obligation to create
an entirely new record or compilation of records containing both
existing and new information, even if the records containing some of
the required information were not created at the time the food was
received or released.
Our intent is to have as little impact as possible on current
recordkeeping practices if those records can meet the requirements of
these regulations. FDA received numerous comments, as discussed further
in section III.G of this document on ``Can existing records satisfy the
requirements of this subpart?'' that agreed with this approach to not
specify the type and format of the records and to allow flexibility to
use existing recordkeeping systems. In addition, comments state that
individual companies are in a better position to decide in what format
records are needed based on knowledge of applicable business practices
and cost structures. For these reasons, FDA has not included a model
form in this final rule.
(Comment 2) Several comments state that the food industry has
repeatedly demonstrated the ability to identify and remove product from
grocery store shelves very quickly. The comments suggest that the
diversion of substantial resources that would be necessary to implement
the agency's proposed regulations would not further food security, but
instead would diminish the overall efficiency of the food distribution
system, which is necessary to serve food safety and security needs and
commercial purposes.
Further, some comments assert that the regulations are directed
toward enabling the Government to trace a product, rather than ensuring
that companies are able to trace the product through all the links in
the chain of custody of a food ingredient or product. The comments
state that the intent of the Bioterrorism Act was to ensure the
existence of a system that fully engages the institutional knowledge
and logical procedures that already enable the companies responsible
for the production and distribution of food to maintain an orderly and
efficient nationwide supply chain and that also currently make it
possible to effect rapid recalls when necessary. The comments state
that the proposed regulations fail to capitalize on the efficiencies of
time and resources available through effective public/private
coordination, exemplified by the efforts that currently support
effective recalls.
(Response) FDA recognizes that some of the food industry currently
has existing records that may satisfy all or part of these regulations;
however, not all of the food industry is currently able to conduct such
traceback investigations. Notwithstanding the ability of some of the
food industry to conduct such investigations, Congress authorized FDA
through the Bioterrorism Act to issue regulations requiring the
establishment and maintenance of records by persons who manufacture,
process, pack, transport, distribute, receive, hold or import food to
enable FDA to identify the immediate previous sources and immediate
subsequent recipients of food, including its packaging, to address
credible threats of serious adverse health consequences or death to
humans or animals. FDA believes the information required to be
established and maintained in records in these regulations is necessary
to enable FDA to conduct an efficient and effective tracing
investigation, independent of what the food industry may be able to do.
FDA reiterates that it is not dictating the form or type of system to
be used to satisfy these requirements in these regulations. If the food
industry already keeps all of the information required by this final
rule, then existing records can be used to comply with this final rule.
Further, FDA anticipates working closely with the food industry in any
tracing investigation.
In addition, recently FDA was significantly hampered in identifying
the source of contaminated food during a trace back investigation
following a Hepatitis A outbreak due to contaminated green onions. This
outbreak involved a distributor who purchased green onions from a
variety of firms in no predictable pattern and distributed them without
recording brand and lot information. The distributor did not keep
records of the previous sources of the green onions, which might have
indicated a particular supplier of green onions during the specified
exposure time period. It was impossible for investigators to determine,
from the distributor, the identity of the supplier of the green onions
that were sent to the implicated restaurant, and therefore FDA had to
spend time investigating all potential suppliers of the green onions to
identify the one supplier that supplied the restaurant. Speedy trace
back would have enabled FDA to prevent further distribution of
contaminated products sooner, thereby preventing more illnesses.
Further, 20 percent of all tracing investigations are prematurely
terminated due to deficiencies in recordkeeping. A reduction of just
one premature termination could prevent at least 53 people from
becoming ill. Requiring adequate records to complete a tracing
investigation reduces trace-back times by 8 days. This increased
efficiency facilitates preventive action in 15 to 18 percent of
outbreaks. The speed with which a tracing investigation can be
conducted is of vital importance in reducing the number of people who
could potentially become ill. Access to records that do not exist or
that do not contain sufficient information (with no requirement to
retain them or make them available in a timely fashion) is not an
efficient and effective way to conduct a tracing investigation during a
public health emergency involving
[[Page 71567]]
serious adverse health consequences or death to humans or animals.
(Comment 3) One comment states that established industry practice
with regard to investigating product defects and conducting product
recalls is consistent with the terms of the Bioterrorism Act allowing
for the rapid identification of the immediate previous source and
immediate subsequent recipient of foods. The comment asserts that the
industry's response to the events of September 11, 2001, has
strengthened these existing practices. The comment explains that as an
inevitable result of industry's commitment to Responsible Care Security
Code No. 7 and increased requests from customers, emphasis is now
shifting from security at fixed plant sites and major distribution
centers to security of products throughout the value chain. This shift
in emphasis enhances industry's existing traceback capabilities. The
comment asserts that the controls needed to effectively trace the
source and recipient of foods are already in place.
(Response) As explained in the response to comment 2, these
provisions are intended to help ensure that FDA has the information it
needs to identify the immediate previous sources and immediate
subsequent recipients of food to address credible threats of serious
adverse health consequences or death to humans or animals.
(Comment 4) One comment asserts that when food presents a risk of
serious adverse health consequences or death to humans or animals, a
class I recall is used and can quickly eliminate problems, whereas
recordkeeping, at best, will get a message to the retail locations
where products were placed on sale to consumers. The comment questions
the benefit of the copious amounts of information and possible
implementation of an intricate new product tracking system required by
the regulations. The comment asserts that class I recalls will continue
to be the appropriate means by which a potential hazard is handled and
that requiring the expenditure of significant resources to develop a
new system in the absence of a Congressional mandate or a genuine need
is questionable. The comment recommends that FDA continue to rely upon
the proven capabilities of class I recalls and cooperation with the
food industry. The comment suggests that FDA should develop a system to
contact the appropriate companies to engage their assistance in
addressing threats to the food supply, rather than requiring the
onerous recordkeeping specified in the regulations.
(Response) This comment assumes that the contaminated food and its
whereabouts are known completely, which may not always be the case. As
such, the need exists for records to be able to trace forward fully to
all locations where the food was shipped, as well as trace backwards to
locate any similarly contaminated food shipped to all other locations.
Moreover, class I recalls are voluntary measures only. In the
Bioterrorism Act, Congress has given FDA the means both to establish
requirements for establishment and maintenance of records, and to
administratively detain, on its own initiative, food for which FDA has
credible evidence or information that the food presents a threat of
serious adverse health consequences or death to humans or animals
(section 303 of the Bioterrorism Act). In addition, the records are
needed not only to help remove contaminated food from the market place,
but also to help identify the source of the contamination.
(Comment 5) A few comments state that, in the event of a serious
product issue or life-threatening situation, the only responsible
action to take is to warn the public through the media to prevent
further use or distribution of the product. The communication vehicle
used to disseminate the warning should be based on the severity of
potential harm or health consequences. Use of the media also is
necessary to influence facilities to check their store stock and for
consumers to check their refrigerators and pantries for the affected
product.
(Response) FDA agrees that the use of warnings to the public about
specific products is important. Indeed, FDA has used this approach many
times. Nonetheless, records will ensure that FDA can perform trace
forward to remove the problem food from the market and traceback to
identify the source of the problem. These recordkeeping requirements
will also enable FDA to identify the problem food more specifically
and, thus, FDA can target its public warnings on the specific
problematic food.
(Comment 6) A few comments request that the agency add a ``pipeline
provision'' that allows the use of NA (not available) in place of
information where ingredient records were not maintained. The comments
state that many ongoing processing operations will have some
ingredients on site that have been purchased and housed in facilities
for some time prior to the implementation of these regulations. In
these cases, it would be a significant manpower burden (or perhaps not
possible at all) to obtain or attempt to recreate all the required
information on the source of those ingredients. The comments note that
these ingredients have been used in food production without incident
and it would be unlikely they would be involved in an act of terrorism.
(Response) There is no requirement to establish and maintain
records for food ingredients you received before the compliance date of
these regulations. Under that scenario, however, you must establish and
maintain records of that food when you release it after the compliance
date of the regulations. For example, if a commercial bread bakery
receives flour, eggs, and salt before the compliance date of this final
rule, it does not need to keep records of the immediate previous source
of when it received that food. Once the bakery uses these ingredients
to bake the bread and releases the bread to nonconsumers after the
compliance date of the rule, the bakery must keep the records required
by Sec. 1.345 of this final rule regarding the immediate subsequent
recipients of the bread.
(Comment 7) One comment recommends the use of United Code Council
standards, a system of globally recognized and implemented standards
that enables traceability of products and identification of trading
parties/recipients, through all locations of the supply chain.
(Response) FDA does not agree. The agency has determined that the
least burdensome way of issuing the recordkeeping requirements is to
specify the information that must be contained in the records, but not
the format in which the records are kept. Indeed, the agency received
numerous comments that argued that covered entities should be allowed
to use existing records and systems.
(Comment 8) One comment requests that source labeling, including
country-of-origin labeling, be required as a component of an effective
traceback program in the event of a food emergency. The comment states
that some industries have already developed technologies such as
barcodes, stamps, stickers, or tags to identify the source of produce
as well as software to assist in more accurate traceback to the grower/
packer level.
(Response) FDA does not agree. At this time, FDA does not believe
this information is necessary to enable a traceback. FDA believes the
requirements of the final regulations for the establishment and
maintenance of records to identify the immediate previous sources and
immediate subsequent recipients of food in order to address credible
threats of serious
[[Page 71568]]
adverse health consequences or death to humans or animals are
sufficient.
(Comment 9) Some comments ask that the agency generate more
publicity on the regulations and provide the industry with educational
materials and training. One comment states that because food wholesale
distributors have no significant contact with FDA personnel and
procedures, they have a limited understanding of the requirements. One
comment asks that the agency help promote and educate the industry
abroad on the recordkeeping regulations. Another comment asks that FDA
provide materials in other languages. One comment asks that the agency
develop a strong communications program to disseminate the new
regulations once they become final because the fresh produce industry
and its transportation partners are highly diverse and fragmented. The
comment states that independent truckers in particular need to be made
aware of the regulations because the fresh produce industry in the
United States relies heavily on independent truckers to move fresh
fruits and vegetables to market quickly.
(Response) FDA conducted extensive outreach on the proposed
recordkeeping rule, including having relevant FDA staff attend 6
international meetings and more than 100 domestic meetings to ensure
that affected parties were aware of the Bioterrorism Act requirements.
On May 7, 2003, FDA held a public meeting (via satellite downlink) to
discuss the recordkeeping and administrative detention proposed rules.
See 68 FR 16998 (April 8, 2003) or http://www.cfsan.fda.gov/~dms/fsbttra2.html.
Nearly 1,000 participants in North and South America and
the Caribbean viewed that live broadcast. The meeting was later
rebroadcast to Europe, Asia, Africa, and the Pacific (areas in
different time zones). FDA has also provided transcripts of the
broadcast in English, French, and Spanish (the three official World
Trade Organization languages) on the agency's Web site. In addition to
this outreach to the affected industry, FDA has conducted outreach on
the proposed rule to States.
FDA plans similar outreach directed to stakeholders following
publication of the final rule implementing the recordkeeping provisions
of the Bioterrorism Act. Our outreach will include the following:
• Materials and events for the media;
• Domestic outreach meetings to States and industry;
• International outreach to U.S. trading partners;
• Presentations by FDA officials and exhibits at
professional and trade conferences and meetings to inform industry and
State and local government representatives of the new regulations and
their requirements; and
• Cooperative arrangements with other Federal agencies to
ensure that information on the final regulations and their requirements
is disseminated to affected companies and individuals.
More specifics regarding each of these will be included on FDA's
Web site at http://www.fda.gov/oc/bioterrorism/bioact.html.
(Comment 10) Several comments suggest that, to lessen the burden to
the food industry, FDA needs to coordinate with other local, Federal,
and State government security programs in establishing the final
recordkeeping regulations.
(Response) In issuing these recordkeeping regulations, FDA has
stated that records established and maintained as a result of local,
State, or other Federal regulations, or as a matter of routine business
practice, need not be duplicated if the records contain all the
information required by these regulations. Further, if existing records
contain some, but not all, of the required information, persons may
supplement existing records with the additional information required
under this final rule.
(Comment 11) One comment asks that the final rule require that
upstream entities provide all the required information to downstream
entities in the food distribution system. The comment states that
distribution centers that receive and store food and retail outlets
that hold and sell food do not know and should not be required to
determine many of the information items required under the proposed
regulation. The comment states that requiring that any information be
passed through the system from the first point of distribution,
preferably through electronic means, would alleviate some of the burden
of the recordkeeping requirements on downstream entities.
(Response) The agency does not agree completely that distribution
centers and retail outlets do not know many of the information items.
The agency agrees, however, that including information pertaining to
lot or code numbers of foods in the required records is not practical
for distribution centers and retail outlets, given current business
practices. FDA has, therefore, deleted this requirement. Instead, the
final regulation now only requires that persons who manufacture,
process, or pack food keep records on the lot or code number or other
identifier of the food, and only to the extent this information exists.
Moreover, to minimize the burden this regulation may have on affected
parties, FDA is not specifying the form or format of the records that
must be established and maintained and is not requiring electronic
records.
(Comment 12) Several comments applaud the agency's efforts in
proposing a rule that appears to be designed to work with the food
industry as efficiently and effectively as possible to address credible
threats without imposing undue burdens. One comment urges the agency to
issue the final regulations as expeditiously as possible to enhance
compliance with the provisions of the Bioterrorism Act. The comment
states that, by finalizing the regulations in conjunction with the
interim final rules entitled ``Registration of Food Facilities Under
the Public Health Security and Bioterrorism Preparedness and Response
Act of 2002'' (the registration interim final rule) (68 FR 58894,
October 10, 2003) and ``Prior Notice of Imported Food Under the Public
Health Security and Bioterrorism Preparedness and Response Act of
2002'' (the prior notice interim final rule) (68 FR 58974, October 10,
2003), the education and training that will be necessary for compliance
with the regulations can be done together and the internal policy and
procedures for companies can be designed to meet all of the obligations
under the final rule. The comment further states that this is the
reason that Congress intended regulations to be issued within 18 months
of the effective date of the Bioterrorism Act.
(Response) The agency has acted expeditiously in issuing all of the
regulations under the Bioterrorism Act and has developed and published
final regulations as quickly as possible. With respect to education and
training, as stated previously, the agency intends to conduct extensive
outreach to stakeholders for this final rule that is similar to
outreach the agency conducted for the registration and prior notice
interim final rules.
(Comment 13) One comment requests clarification regarding the level
of recordkeeping that will be expected at each facility maintained by a
vertically integrated company. The comment explains that a vertically
integrated company has various facilities involved in the growing and
processing of bulk ingredients as well as the manufacturing and
marketing of finished products. Some of the requirements for
recordkeeping could result in duplication of effort if each facility
within the company is required to
[[Page 71569]]
maintain separate records, even though the overall records are
available at company headquarters or some central location. One comment
requests that the final rule clarify what is meant by the term
``released'' and the relationship of this term to holding legal title,
or ownership of the food. Another comment suggests that FDA clarify
that only at such time as the food leaves the possession and control of
one firm and enters into the possession and control of another firm,
whether or not via a transporter, would the recordkeeping requirement
apply. The comment maintains that any other interpretation of the
statute would impose a crushing burden of internal tracking systems and
paperwork that would detract from most firms' abilities to do business
and is well beyond the intent of the Bioterrorism Act.
(Response) The records required by these regulations are those that
FDA needs for inspection to identify the immediate previous sources and
the immediate subsequent recipients of food. ``Immediate previous
source'' has been defined in Sec. 1.328 of the final rule to mean ``a
person who owns food or who holds, processes, packs, imports, receives,
or distributes food or food packaging, and that last had an article of
food before transferring it to another person.'' Unless otherwise
exempt (i.e., a farm), a ``vertically integrated company'' would be
required to identify the sources of all food received from its
immediate previous sources. Once the vertically integrated company
receives the food and keeps information on its immediate previous
sources, that vertically integrated company does not need to keep
additional records until it releases the food to another person. Unless
otherwise exempt, at the time the vertically integrated company
releases the food, it is required to identify the immediate subsequent
recipients of that food.
As an example, if a company buys food from its immediate previous
source (company A), then the company further processes the food, holds
the food, transports the food, and distributes the food to a grocery
store, then the vertically integrated company would only have to keep
records on its immediate previous source (company A) and its immediate
subsequent recipient (grocery store). The vertically integrated company
need not keep records of all the covered activities (manufacturing,
processing, packing, transporting, etc.) conducted by that company
while it has the food.
Of course, when the integrator has any records or other information
available to FDA under sections 414 and 704(a) of the FD&C Act, then
FDA would have access to those records if FDA has a reasonable belief
that the food is adulterated and presents a threat of serious adverse
health consequences or death to humans or animals.
B. Foreign Trade Issues
(Comment 14) Several comments representing foreign governments and
international associations agree in principle to the recordkeeping
requirements provided the requirements are based on a sound risk
assessment and do not restrict trade more than necessary to effectively
address potential risks. Some comments note that there is no risk
assessment provided to justify the proposed measures required by the
World Trade Organization Agreement on the Application of Sanitary and
Phytosanitary Measures (SPS agreement). Several comments representing
foreign governments and businesses request that FDA work with foreign
governments to develop common standards and requirements and to
facilitate trade flow. Some foreign comments argue that the result of
the onerous recordkeeping burden in the regulations will be the
elimination of many legitimate and safe food distribution businesses
and a serious reduction in global food trade. One comment suggests that
the regulations will adversely impact trade, as they are likely to
increase uncertainty and costs for foreign exporters. Small and medium
sized foreign companies in particular may be prevented from continuing
to export to the United States for these reasons. One comment is
concerned that the regulations may lead to the unintended consequence
of foreign countries imposing the same requirements of U.S. goods in
foreign trade.
(Response) FDA considers that these foreign trade comments are now
moot, given the scope of these final regulations. These final
regulations do not apply to foreign persons, except foreign persons
transporting food in the United States, who are treated no differently
than domestic food transporters under these final regulations. FDA does
not believe that foreign persons who transport food in the United
States will incur additional costs as a result of these regulations,
because FDA assumes that they will choose to comply with Sec. 1.352 of
this final rule by establishing and maintaining the records already
required by FMCSA. See the response to comment 82, later in this
document.
C. Comments on Who is Subject to This Subpart? (Proposed Sec. 1.326)
1. General
(Comment 15) Several comments seek clarification on who is covered
by the proposed regulation. Comments ask if the provisions of the
regulations apply to port facilities, such as warehouses, or storage
and inspection facilities in land, sea, or airports that belong to
private companies and government bodies for food control in the country
of shipping and/or origin.
(Response) Persons who manufacture, process, pack, transport,
distribute, receive, hold, or import food in the United States are
subject to these regulations. ``Person'' is defined in section 201(e)
of the FD&C Act (21 U.S.C. 321 (e)) and includes any ``individual,
partnership, corporation, and association.'' Therefore, any person
located in any State or Territory of the United States, the District of
Columbia, or the Commonwealth of Puerto Rico who manufactures,
processes, packs, transports, distributes, receives, holds, or imports
food is included within the term ``person''. ``Holding'' has been
defined in Sec. 1.328 of the final rule to mean ``storage of food.
Holding facilities include warehouses, cold storage facilities, storage
silos, grain elevators, and liquid storage tanks.'' Accordingly, port
facilities, such as warehouses, or storage facilities that are located
in any State or Territory of the United States, the District of
Columbia, or the Commonwealth of Puerto Rico are subject to these
regulations as they are ``persons'' who are holding food.
(Comment 16) One comment seeks clarification on whether the
proposed regulation applies to a carrier's freight brokers. The comment
states that, although these brokers never have actual physical
possession of freight, they act as the middleman for carriers and
shippers and have knowledge of where the freight came from and where it
went. A few comments ask that FDA clarify that customs brokers are
excluded from the regulations. The comment indicates that because Sec.
1.326 of the proposed regulations applies to, inter alia, persons that
``import'' food, it could be interpreted to include customs brokers,
who act only as agents for the importer. A comment notes that customs
brokers have only the information needed to file an entry on behalf of
the actual importer and to obtain release of the food from U.S. Customs
and Border Protection (CBP). However, according to the comment, customs
brokers do not own food or hold, process, pack, import, receive, or
distribute food for purposes other than
[[Page 71570]]
transportation. The comment notes that applying the recordkeeping
requirements to customs brokers would cause redundant and burdensome
recordkeeping requirements for them.
(Response) FDA clarifies that the recordkeeping requirements do not
apply to brokers who act only to facilitate distribution, sale, or
transportation of food by processing information or paperwork
associated with these functions. Brokers who do not directly
manufacture, process, pack, transport, distribute, receive, hold, or
import food are not subject to the requirements of the regulation.
(Comment 17) One comment asks that FDA specify whether the
regulation applies to the importer of record or to the initial U.S.
recipient when the merchandise enters the country. The comment notes
that this clarification could affect who is responsible for the
establishment and maintenance of records.
(Response) The final rule applies to persons who manufacture,
process, pack, transport, distribute, receive, hold, or import food in
the United States, unless the person qualifies for an exclusion in
Sec. 1.327 of the final rule. An importer of record or an initial U.S.
recipient that is involved in one or more of the identified activities
must establish and maintain the required records.
(Comment 18) Several comments express concern because the proposed
regulation applies only to domestic, for-hire transporters, and foreign
transporters that enter the United States, as well as domestic private
transporters, are not covered. Comments state that the regulation
should apply uniformly to all transporters, foreign and domestic, for-
hire and private, to ensure that no group has an unfair competitive
advantage.
(Response) All persons transporting food in the United States must
meet the requirements of subpart J of this final rule, regardless of
whether they are ``for hire'' or ``private.'' FDA notes, however, that
if a manufacturer located in the United States transports the food in
its own company trucks, then it must comply with the recordkeeping
requirements for nontransporters as opposed to those applicable to
transporters because FDA does not need the facility to keep duplicative
records of the food while it is in that facility's control. However, if
a foreign person, such as a person who manufactures food, transports
food in the United States, it must comply with the requirements for
transporters, even if it transports the food in the United States
itself. This ensures that FDA will have the ability to traceback the
food that is transported in the United States, even if the facility
from which the food originates is an exempt foreign facility under
subpart J.
(Comment 19) One comment notes that CBP's current requirements
apply to trucking companies that transport imported food into the
United States. The comment suggests that FDA coordinate with CBP to get
data from them in the event of a threat to the nation's food supply,
rather than develop its own distinct recordkeeping regulations.
(Response) The records required to be kept by these regulations are
those FDA needs to help identify the immediate previous sources and
immediate subsequent recipients of food. Section 1.361 of the final
rule allows FDA access to transporters' existing records when FDA has a
reasonable belief that an article of food is adulterated and presents a
threat of serious adverse health consequences or death to humans or
animals. When conducting a traceback, FDA needs access to the required
records at each point in the distribution chain for the implicated
food. Thus, FDA will expect to obtain applicable records from
transportation companies in the distribution chain. Although FDA may
contact, and coordinate tracebacks with, other Federal agencies,
including CBP, the agency expects transportation companies to comply
with the recordkeeping and access provisions of these regulations. FDA
notes that entities keeping records to satisfy CBP's regulations may
use those same records to satisfy some or all of the requirements of
this final rule if those records contain some or all of the information
required by subpart J of this final rule. Entities also can supplement
existing records with any new data required by this regulation, instead
of creating an entirely new record containing both existing and new
information.
(Comment 20) A few comments ask FDA to clarify what constitutes
``holding'' food, who FDA considers to be ``holders of food,'' and
under what circumstances food is being held in transport. The comment
notes that the lack of clarity leaves a carrier's terminal operating
facility, gas stations, truck stops, and even trucks themselves
vulnerable to being considered as ``holders of food'' and thereby
subject to burdensome reporting requirements. Comments also ask FDA to
exclude trucks, truck terminals, and facilities from the definition of
``holding,'' stating that this would be consistent with the intent of
the law and the realities of the trucking industry's business
practices. One comment asks whether food held for short periods of time
in a trucking terminal during cross-dock operations meets the
definition of ``holding.'' One comment states that there are certain
areas in the supply chain that provide temporary space for food during
transit and that these areas should not be considered to be ``holding''
or ``storing'' food and subject to the recordkeeping requirements. The
comment notes that some sites serve as transitory staging areas where
produce is momentarily held before transportation and that, because of
the perishable nature of the product and the desire to transport the
fresh commodity rapidly, produce moves from these staging areas as
quickly as possible.
(Response) ``Holding'' means storage of food. Holding facilities
include warehouses, cold storage facilities, storage silos, grain
elevators, and liquid storage tanks. The recordkeeping requirements in
Sec. Sec. 1.337 and 1.345 of this final rule apply to persons who
``hold'' food for purposes other than transportation. As defined in
Sec. 1.328 of this final rule, a ``transporter'' is:
* * * a person who has possession, custody, or control of an
article of food in the United States for the sole purpose of
transporting the food, whether by road, rail, water, or air.
Transporter also includes a foreign person that transports food in
the United States, regardless of whether that person has possession,
custody, or control of that food for the sole purpose of
transporting the food.* * *
Truck terminals or similar facilities that are part of the
transportation process and merely provide a location for trucks to
transfer possession, custody, or control to another entity are not
subject to the requirements in Sec. Sec. 1.337 and 1.345 of the final
rule, unless possession, custody, or control is transferred to that
terminal or facility.
(Comment 21) One comment seeks clarification on whether a
``customer,'' such as an office complex, would be required to maintain
records if it receives and stores a food, such as bottled water, in the
customer's own storage area for subsequent distribution to the various
offices within the complex. The comment also asks whether, for bottled
water, such a customer would also be the immediate previous source for
bottles that are returned to the bottler for reuse.
(Response) FDA has added an exclusion to the final rule for persons
who receive or hold food on behalf of specific individual consumers and
who are not also parties to the transaction and who are not in the
business of distributing food. This exclusion covers person such as a
hotel concierge, the reception desk in an apartment building, and an
office complex that
[[Page 71571]]
receives bottled water as described by the comment. FDA has added this
exclusion because such persons are not parties to the transaction and
records from such person are not necessary to identify the immediate
previous sources and immediate subsequent recipients of food to address
credible threats of serious adverse health consequences or death.
The comment also asks whether, for bottled water, such a customer
would also be the immediate previous source for bottles that are
returned to the bottler for reuse. A customer who returns bottles to
the bottler would be the nontransporter immediate previous source of
the bottles (Sec. 1.328 of the final rule). As with other sources of
its bottles (e.g., a bottle manufacturer), the bottler would be
required to keep records of bottles received from customers for reuse.
(Comment 22) One comment asks that FDA clarify in the regulation
that domestic grain-handling, feed manufacturing/ingredient or
processing facilities dedicated solely to exporting bulk or processed
agricultural commodities to other countries are exempt from the
recordkeeping requirement unless the commodities, products, or
byproducts they handle are introduced into U.S. commerce. The comment
states that this clarification would be consistent with the statutory
language and FDA's proposed regulations.
(Response) The proposed rule applied to persons who manufacture,
process, pack, transport, distribute, receive, hold, or import food
intended for consumption in the United States, unless the person
qualifies for an exclusion in Sec. 1.327. This provision has been
changed in the final rule. The Bioterrorism Act does not limit the
recordkeeping authority to food that is consumed in the United States.
FDA's intent in the proposed rule was to apply the recordkeeping
provisions to the full reach of section 306 of the Bioterrorism Act
with respect to domestic persons. In contrast, the registration interim
final rule that FDA issued under section 305 of the Bioterrorism Act
only requires those facilities that manufacture, process, pack, or hold
food for consumption in the United States to register. The proposed
recordkeeping rule inadvertently added the same qualifier as is in the
registration interim final rule: That is, it only applied to food that
was ``intended for consumption in the United States.'' FDA is removing
this qualifying language from the final rule to ensure that all persons
that manufacture, process, pack, transport, distribute, receive, hold,
or import food in the United States are subject to this final rule
unless otherwise exempt. FDA believes this coverage is necessary
because foods intended for export could easily be diverted into
domestic commerce. In addition, not everyone in the food supply chain
may know if the food is intended for consumption in the U.S. or
intended solely for export. Therefore, such a limitation in this
rulemaking could create holes in a tracing investigation. Further, FDA
is concerned that exempting foods intended for export from the
recordkeeping regulations could lead to such foods being targeted for
tampering and reintroduction into domestic commerce because they would
prove more intractable to tracing investigations.
(Comment 23) One comment asks whether small growers who provide a
raw agricultural commodity to a cooperative must keep records and
whether the cooperative must list all of the growers.
(Response) Growers of raw agricultural commodities that meet the
definition of ``farm'' in Sec. 1.328 are excluded from the
requirements of subpart J of this final rule. A cooperative that
accumulates raw agricultural commodities from growers, and does not
meet the exemption for retail food establishments that employ 10 or
fewer full-time equivalent employees in Sec. 1.327(f) of the final
rule, is subject to the requirements in Sec. 1.337 of the final rule
regarding the immediate previous sources of food. Distribution of food
from the cooperative directly to consumers is excluded from the
requirements of Sec. 1.345 of the final rule regarding the immediate
subsequent recipients of food.
2. Intrastate
(Comment 24) One comment agrees that the requirement for U.S.
domestic firms, whether shipping interstate or intrastate, to establish
and maintain records as provided in the proposed regulation will
maximize FDA's capability to implement traceback procedures within the
borders of the United States. Another comment states that a finding
that a certain food is intentionally contaminated--even if only
distributed or sold locally--could have widespread, nationwide, even
international, economic implications. The comment states that the
recent ``mad cow'' episode in Canada demonstrates that restrictions
might be imposed on the distribution and sale of implicated products,
or consumers across the country may decide not to buy the products thus
impacting the economy as a whole. As a result, the comment states that
FDA is correct in concluding that all persons who manufacture, process,
pack, transport, distribute, receive, hold, or import food should be
subject to the recordkeeping requirements whether or not they directly
engage in interstate activities involving food.
However, another comment states that FDA's intent to assert
jurisdiction over food, whether or not it enters interstate commerce,
may be unconstitutional. The comment notes that this assertion of power
to regulate food in intrastate commerce is inconsistent with
limitations imposed by the Commerce Clause of the U.S. Constitution,
which generally authorizes Congress to regulate purely interstate
commerce only. The comment further states that FDA should have assumed
that Congress did not intend to violate the Constitution, and should
revise the proposed rule accordingly. Another comment states that the
FDA is proposing that domestic persons must maintain appropriate
records as stipulated by the proposed regulations regardless of whether
their food enters interstate commerce. The comment adds that
appropriate State, local, and municipal regulatory bodies have
authority to regulate domestic persons who manufacture, process, pack,
transport, distribute, receive, or hold food intended for human or
animal consumption, when intended solely for intrastate commerce in the
United States. The comment argues that the proposed regulations
regarding recordkeeping should not be expanded beyond what has been set
forth in the Bioterrorism Act.
Another comment states that the FMCSA has guidelines for
determining whether carriers and drivers are engaged in interstate
commerce and provides the following definition in 49 CFR part 390.5:
Interstate commerce means trade, traffic, or transportation in
the United States--(1) Between a place in a State and a place
outside of such State (including a place outside of the United
States);
(2) Between two places in a State through another State or a
place outside of the United States; or
(3) Between two places in a State as part of trade, traffic, or
transportation originating or terminating outside the State or the
United States.
(Response) In the preamble to the proposed rule, FDA sought
comments on its tentative conclusion that it has authority to require
recordkeeping by persons engaged only in intrastate commerce. FDA also
sought comments on how many intrastate persons would not be covered by
one of the exclusions
[[Page 71572]]
from the recordkeeping requirements (e.g., the farm or restaurant
exemption). Based on consideration of the received comments and further
review of the provision of the Bioterrorism Act that provides FDA with
the authority to require the establishment and maintenance of records
by all ``persons'' who engage in specified activities involving food,
FDA has concluded that the Bioterrorism Act gives FDA authority to
require persons to establish and maintain records, whether or not they
engage in interstate commerce, as long as they fall within Congress's
power to legislate in this area.
FDA is mindful that its interpretation of the Bioterrorism Act
should not cast doubt on the constitutionality of the statute. (See
Solid Waste Agency of Northern Cook County v. U.S., 531 U.S. 159
(2001).) The agency has considered the relevant provisions of the
Bioterrorism Act, the comments submitted on this issue, FDA's
responsibilities in implementing the Bioterrorism Act, and the law
interpreting the Commerce Clause of the Constitution (Article I,
section 8). Based on these considerations, FDA is retaining Sec.
1.326(b) as proposed, with the result that all persons that
manufacture, process, pack, transport, distribute, receive, hold, or
import food in the United States (unless otherwise exempt) must
establish and maintain records, even if food from the facility does not
enter interstate commerce.
The plain language of new section 414 of the FD&C Act does not
exclude a facility from recordkeeping because food from such facility
does not enter interstate commerce. Notably, sections 301 and 304 (21
U.S.C. 331 and 334) of the FD&C Act demonstrate that Congress has
included a specific interstate commerce nexus (e.g., has explicitly
required interstate commerce) in the provisions of the FD&C Act when
that is its intent. Accordingly, it is reasonable to interpret the
Bioterrorism Act as not limiting recordkeeping only to those persons
with a direct connection to interstate commerce. Congress's power to
legislate under the Commerce Clause is very broad. We acknowledge that
such power is not without limits, see United States v. Lopez, 514 U.S.
549, 567 (1995); U.S. v. Morrison, 529 U.S. 598, 618 (2000), but these
limits have to be construed in light of relevant and enduring
precedents.
In particular, in Lopez, supra, the Supreme Court acknowledged the
continuing vitality of Wickard v. Filburn, 317 U.S. 111 (1942), noting
that:
* * * although Filburn's own contribution to the demand for
wheat may have been trivial by itself, that was not `enough to
remove him from the scope of federal regulation where, as here, his
contribution, taken together with that of many others similarly
situated, is far from trivial.'* * *
(Lopez, 514 U.S. at 556.) This principle applies squarely to the
recordkeeping provision of the Bioterrorism Act. Accordingly, given the
collective impact on commerce of intrastate manufacturing, processing,
packing, transporting, distributing, receiving, or holding of food in
the United States, FDA has concluded that the requirement to establish
and maintain records should apply regardless of whether the food enters
interstate commerce. Thus, FDA is retaining Sec. 1.326(b) as proposed.
See also response to comment 82 below for an expanded discussion of the
collective impact on commerce of intrastate transportation of food.
This is consistent with section 709 of the FD&C Act (21 U.S.C.
379a), which states that, in any action to enforce the FD&C Act's
requirements respecting foods, drugs, devices, and cosmetics, any
necessary connection with interstate commerce is presumed. Likewise,
this outcome is consistent with Congress's goal in enacting the
Bioterrorism Act, because the potential harm from bioterrorist attacks
or other food-related emergencies can be great, whether or not the food
moves from one State to another. The usefulness of recordkeeping also
can be significant in food emergencies where interstate shipment has
not occurred.
3. Foreign Facilities
(Comment 25) Several comments assert that FDA lacks the statutory
authority to apply the recordkeeping and records inspection provisions
of the Bioterrorism Act to foreign facilities. According to the
comments, section 306 of the Bioterrorism Act does not indicate,
expressly or by inference, that Congress intended the provisions of
that section to apply to overseas persons or facilities. They also
contend that nothing in the legislative history of the Bioterrorism Act
indicates Congress intended that section 306 of the Bioterrorism Act
should apply to foreign facilities. The comments point out that there
is a longstanding presumption in the law that legislation does not
apply outside the borders of the United States, unless Congress clearly
and expressly states such an intent. The comments state that, under
governing case law, FDA may not infer legislative intent to give a
statute extraterritorial reach.
A few comments indicated that FDA failed to provide legal
justification for applying the regulation to foreign facilities. The
comments pointed out that FDA's stated belief that this was the most
efficient and effective strategy for obtaining needed information on
food from foreign countries cannot overcome the clear indications that
Congress did not intend section 306 of the Bioterrorism Act to apply to
foreign entities.
One comment suggests that FDA clarify that the recordkeeping
requirements do not apply outside of the United States, but serve only
as a guideline to facilitate a rapid response through cooperation at
intergovernment and international industry levels. One comment states
that it has been acknowledged in the context of recent CBP initiatives
that CBP has no jurisdiction in foreign countries. The comment notes
that, consequently, mutual agreements on cooperation between CBP and
some foreign governments have been reached to address together their
shared security objectives. Comments suggested that FDA pursue a
similar approach for safety and security of foods.
One comment asks what action FDA can take against foreign companies
that do not establish and maintain the records required under section
306 of the Bioterrorism Act. A few comments state that the fact that
section 306 of the Bioterrorism Act does not provide any mechanisms for
enforcement of the recordkeeping and records access requirements
against foreign persons supports the position that Congress did not
intend that section to apply to foreign entities.
(Response) Because FDA has decided, for policy reasons, to exempt
foreign facilities that do not manufacture, process, pack, distribute,
hold, or import food in the United States from the requirements of the
rule, FDA does not need to decide this jurisdictional issue. FDA is
exempting all foreign persons (except for foreign persons who transport
food in the United States) from the final regulation because FDA does
not believe such records would be needed. Much of this information is
available to the Secretary from facilities required to provide prior
notice under part 1, subpart I. FDA intends to work with the competent
authorities in foreign countries to access records during public health
emergencies to obtain additional information, if necessary. However,
the final rule explicitly provides that persons who transport food in
the United States are subject to subpart J of this final rule.
(Comment 26) One comment questions FDA's determination that it can
perform its Bioterrorism Act
[[Page 71573]]
mission of tracking shipments by exempting Mexican and Canadian motor
carriers from the recordkeeping requirements while requiring U.S. motor
carriers to comply with the recordkeeping requirements. The comment
notes that, based on CBP figures for Mexico-domiciled carriers,
referenced in the ``Economic Impact Estimates'' section of the proposed
rule, 63,000 out of 80,000 carriers operating across the southern
border are Mexico-domiciled. The comment points out that, therefore,
the majority of cross-border FDA-regulated shipments at the southern
border may be exempt from the requirements of the regulation.
(Response) FDA agrees. The final rule provides that foreign persons
who transport food in the United States are subject to this final rule.
A ``transporter'' is now defined as:
* * * a person who has possession, custody, or control of an
article of food in the United States for the sole purpose of
transporting the food, whether by road, trail, water, or air.
Transporter also includes a foreign person that transports food in
the United States, regardless of whether the foreign person has
possession, custody, or control of that food for the sole purpose of
transporting that food.* * *
Thus, even if a foreign manufacturing facility transports its own
manufactured food into the United States, it is considered a
``transporter'' under subpart J of this final rule and must comply with
the requirements applicable to transporters.
(Comment 27) One comment seeks clarification regarding application
of the recordkeeping requirements to certain ownership-partnership
relationships involving a U.S. trucking company and a Canadian or
Mexican trucking company. The comment asks, for example, whether a
Canadian subsidiary of a U.S. trucking company is subject to the
recordkeeping requirements. The comment states that a Canadian trucking
company may be in partnership with a U.S. company, and the percentage
of U.S. ownership is established in each partnership. Another example
provided by the comment is that a Mexican motor carrier may have a
contractual or interline relationship with a U.S. company. The comment
asks whether the recordkeeping requirements apply to the foreign
transporters with these U.S. relationships.
(Response) The final rule applies to persons who manufacture,
process, pack, transport, distribute, receive, hold, or import food in
the United States. Thus, any person who transports food in the United
States is subject to these recordkeeping requirements with respect to
that food that enters the United States. The partnership or contractual
status with a U.S. company does not affect the application of these
requirements to a foreign person if they are transporting food in the
United States, because such persons are already covered by this final
rule by virtue of transporting food in the United States.
(Comment 28) One comment seeks clarification on whether residency
in a territory of the United States affects applicability of the
regulation. One comment questions FDA's authority to apply the proposed
regulation to the Caribbean jurisdictions of the U.S. Virgin Islands
and the Commonwealth of Puerto Rico. The comment contends that the
regulations would be burdensome to grocery operators or other retailers
in the Caribbean jurisdictions who do not export to the Continental
United States, but would not deter bioterrorism acts in the Continental
United States or in the Caribbean jurisdictions. The comment asserts
that the proposed regulation will jeopardize the island economies of
the Caribbean jurisdictions by increasing unnecessary expenses to the
food retailing activity, which is already more expensive than in the
Continental United States, by adding, among other expenses, the
maritime transportation cost to the goods.
(Response) The final rule applies to persons that manufacture,
process, pack, hold, transport, distribute, receive, or import food in
the United States. Section 201(a)(1) of the FD&C Act defines the term
``State'' as, ``any State or Territory of the United States, the
District of Columbia, and the Commonwealth of Puerto Rico'', and
section 201(a)(2) of the FD&C Act defines the term ``Territory'' as,
``any Territory or possession of the United States, including the
District of Columbia, and excluding the Commonwealth of Puerto Rico and
the Canal Zone).'' Accordingly, any person in the 50 States of the
United States, or in any Commonwealth or Territory of the United
States, that performs a covered activity is subject to the requirements
of this final rule. This includes both Puerto Rico (because, for
purposes of the FD&C Act, it is considered a State) and the U.S. Virgin
Islands (because, as a U.S. territory, it is considered a State for
purposes of the FD&C Act).
D. Comments on Who is Excluded From All or Part of the Regulations in
This Subpart? (Proposed Sec. 1.327)
1. General
(Comment 29) Several comments argue that because the Bioterrorism
Act specifically excludes those foods under the jurisdiction of USDA,
alcoholic beverages should also be excluded, as they are already
regulated by the Department of Treasury's Alcohol and Tobacco Tax and
Trade Bureau (TTB) as well as by CBP. One comment requests that FDA
secure a legislative amendment to the Bioterrorism Act that exempts
wines and spirits and other alcoholic beverages from its application,
in the same way meat, poultry, and egg products under the jurisdiction
of the USDA are excluded from its scope.
Another comment states that the importer's records enable a product
to be traced from the point of importation to its destination, as well
as back to the producer/supplier. The comment states that substantial
information about a product imported legally into the United States is
already held in the TTB database.
(Response) Unlike products regulated under the exclusive
jurisdiction of USDA under the FMIA, the PPIA, or the EPIA, Congress
did not exempt alcoholic beverages from the scope of the recordkeeping
requirements. FDA has not excluded alcoholic beverages from the scope
of this final rule because FDA believes that these records are needed
to help the Secretary to identify the immediate previous sources and
the immediate subsequent recipients of food to address credible threats
of serious adverse health consequences or death to humans or animals.
Further, FDA reiterates that, to the extent that you already keep the
information required by this final rule to comply with TTB
requirements, or for any other reason, you do not need to establish and
maintain duplicative records.
In addition, securing a ``legislative amendment'' to the
Bioterrorism Act, as the comment suggests, is beyond the scope of this
rulemaking.
(Comment 30) One comment suggests that FDA add an exclusion that
covers persons who transport food for the U.S. military and U.S.
Government agencies with respect to that food. Those entities are
sophisticated and able to establish their own requirements.
Transporters of food for those entities should not be subject to
potentially duplicative FDA standards.
(Response) Congress did not provide for an exemption for food that
is transported for the U.S. military or any other U.S. Government
agency from the scope of the recordkeeping requirements. FDA believes
that these records are needed to help the Secretary identify the
immediate previous sources and the immediate subsequent recipients of
food to address credible threats of serious adverse health consequences
or death to humans or
[[Page 71574]]
animals. Again, with respect to the comment's assertion that
transporters of food for those entities should not be subject to
potentially duplicative FDA standards, FDA agrees. There is no
requirement to keep duplicative records. FDA reiterates that to the
extent that you already keep the information required by this final
rule, you do not need to establish and maintain duplicative records.
(Comment 31) One comment questions whether there are provisions for
the exemption of beekeepers who bottle and sell small amounts of honey
and other beehive products, even if they keep their hives on the
property of others, as is frequently done for pollination purposes or
the production of honey from sites other than the beekeepers' own
property.
(Response) Congress did not provide for an exemption for beekeepers
who bottle and sell small amounts of honey and other beehive products.
FDA believes that these records are needed to help the Secretary
identify the immediate previous sources and the immediate subsequent
recipients of food to address credible threats of serious adverse
health consequences or death to humans or animals. Unless these
entities fall within a specified exemption, they are subject to the
requirements of this final rule. For example, some of the beekeepers
may fall within the exemption for farms or retail food establishments
that employ 10 or fewer full-time equivalent employees. In addition,
beekeepers are not required to keep records of sales directly to
consumers.
(Comment 32) One comment requests clarification on how imported
food samples that do not enter commerce will be handled based on the
regulations. These food samples have the intended end use of analysis,
experimentation, and/or subsequent destruction within approved company
premises. The samples may be carried into the United States as personal
baggage of company representatives or sent unaccompanied. The comment
points out that food carried in personal baggage is exempt from the
registration interim final rule only if the food is for personal
enjoyment/use. Another foreign comment states that the recordkeeping
requirement should not apply to commercial samples. The comment states
that new exporters cannot be expected to engage in recordkeeping
requirements concerning exports before testing marketing opportunities.
(Response) Persons who manufacture, process, pack, transport,
distribute, receive, hold, or import food in the United States that is
intended for consumption by humans or animals are subject to these
regulations. The recordkeeping requirements would not apply to food
samples that are used for quality assurance, research or analysis
purposes, as long as the food samples are not consumed by humans or
animals. Samples of food are considered to be for quality assurance,
research or analysis purposes, rather than human consumption, when they
are in small quantities (i.e., quantities consistent with the quality
assurance, research, or analysis purposes) and the entire sample is
used up by the analysis, destroyed after analysis, or destroyed
following a reasonable retention period after analysis. The analysis
may include sensory examination, such as organoleptic examination for
determining tea quality or detecting the presence of histamines.
Evidence that an article of food is for quality assurance, research, or
analysis purposes only might include, among other evidence, markings on
the food and shipping documents. Food samples intended for consumption
via test marketing, such as tasting at trade shows or product
promotional tasting events, are subject to this subpart.
The recordkeeping rule, however, exempts all foreign persons,
except foreign persons who transport food in the United States.
Therefore, the foreign exporter of the samples mentioned by the
comment's is not required to establish and maintain records under this
final rule. With respect to the comments assertion that the
registration interim final rule exempts food carried in personal
baggage for personal use, FDA notes that it is the prior notice interim
final rule (part 1, subpart I) that exempts these products, not the
registration interim final rule (part 1, subpart H). The registration
interim final rule applies to all domestic and foreign facilities that
manufacture, process, pack, or hold food that will be consumed in the
United States, unless otherwise exempted. This includes facilities
performing covered activities with respect to commercial samples if
those samples will be consumed in the United States. See response to
comment 67 at 68 FR 58911 through 58912 (October 10, 2003). As detailed
in the response to comment 22, this final rule does not distinguish
between food consumed in the United States and food that is exported.
(Comment 33) One comment indicates that the proposal is silent as
to whether firms producing finished food products or food additives and
ingredients intended solely for export must comply with the
recordkeeping requirements. The comment argues that because this
regulation applies to foods for consumption in the United States,
producers of such products should be exempt from the recordkeeping
requirements.
(Response) Persons who manufacture, process, pack, transport,
distribute, receive, hold, or import food in the United States are
subject to these regulations. If the food is intended solely for
export, the person producing that food in the United States would still
be subject to these regulations with respect to that food.
2. Farms
(Comment 34) Several comments ask if foreign farms, including fish
farms (aquaculture) fall under the regulation's farm exemption.
(Response) Section 306 of the Bioterrorism Act specifically exempts
farms from these regulations. The definition of a farm includes
aquaculture facilities. In addition, foreign persons (except for
foreign persons who transport food in the United States), including
foreign farms, are excluded from all of these regulations.
(Comment 35) One comment states that FDA has not clarified whether
producers who ship live food animals to the United States will be
required to keep records on their farm operations, as their products
will be ``finished'' in another country, may have been raised on more
than one farm, and may not be considered as going directly to the
consumer for consumption. The comment strongly urges the FDA not to
require farmers shipping live animals to the United States to incur the
additional cost, time, and work involved in maintaining records, beyond
those which are currently being maintained for their operations, solely
for the purpose of this regulation.
(Response) Farms are excluded from these regulations, as are
foreign persons, except for foreign persons who transport food in the
United States. Therefore, foreign farmers who ship live food animals to
the United States are exempt from this final rule (unless they
transport the animals into the United States themselves). FDA notes,
however, that although foreign exporters of food into the United States
are exempt from these recordkeeping requirements, they must comply with
the prior notice regulations issued under the Bioterrorism Act (part 1,
subpart I). FDA also notes that an importer of live food animals into
the United States would be required to establish and maintain records
under these regulations given
[[Page 71575]]
that importers are not exempt from this final rule.
(Comment 36) One comment states that, although the proposed rule
exempts farms, it may still result in a recordkeeping burden for them.
The comment states that, in practice, the farmer will be expected to
generate paperwork so that those delivering and dropping products off
at the farm will be able to comply with the final rule. Although farms
may be exempt on the face of the rule, the comment states that, in
reality, farmers will have to generate large amounts of paperwork for
their suppliers, truckers, and buyers. The comment states that the
final rule needs to make clear that farmers will not be responsible, or
expected to generate, paperwork for those complying with this rule.
(Response) Farms are specifically exempted from the requirements of
these regulations. Only those persons subject to these regulations must
establish and maintain records of the immediate previous sources and
immediate subsequent recipients of food that they manufacture, process,
pack, transport, distribute, receive, hold, or import. This final rule
does not require a farm to establish or maintain records for those who
are subject to this regulation.
3. Restaurants
(Comment 37) Several comments state that retail food stores offer a
variety of services and conveniences to consumers, including foods that
are prepared in-store and ready for immediate consumption, and that the
restaurant-type facilities in the retail store should be excluded from
the recordkeeping requirements.
One comment notes that the proposed rule includes an exemption for
restaurants, which are defined as facilities that sell food directly to
consumers for immediate consumption. The comment asserts that many
convenience stores make such sales of prepared foods, but convenience
stores are included in the proposed rule's definitions as an example of
retail facilities. In the comment's view, convenience stores that sell
food for immediate consumption should be exempt from the proposed rule.
There is no reason why convenience stores that sell prepared foods
should have greater regulatory burdens than any other type of entity
that sells prepared foods. The comment further states that the
restaurant exemption as currently proposed leads to results that are
difficult to justify. The comment asks why, for example, should a
convenience store that sells lunchmeat be required to comply with a
costly system of recordkeeping, while a delicatessen that sells
precisely the same product to the same consumer is exempt? The comment
states that the only sensible answer to these unjustifiable
inconsistencies is to exempt retailers that sell food to consumers for
immediate consumption from the requirements of the regulation.
(Response) FDA agrees with these comments. Section 306 of the
Bioterrorism Act exempts restaurants from recordkeeping requirements.
There is no similar exemption in section 306 for retail facilities. In
the proposed rule, FDA exercised the agency's discretion and proposed
excluding retail facilities from the requirement to establish and
maintain records of the immediate subsequent recipients of food when
the food is sold directly to consumers (68 FR 25188 at 25192). As
explained therein, the Bioterrorism Act expressly states that the
Secretary may require the establishment and maintenance of records by
persons who ``distribute'' food, and therefore retail facilities could
be subject to all of the provisions in subpart J of this final rule if
FDA thought it was necessary to address credible threats of serious
adverse health consequences or death to humans or animals.
FDA recognizes that some facilities that are predominantly retail
distribute some food to businesses (that then may further distribute
the food before it is consumed) and that some facilities that are
predominantly nonretail distribute some food to consumers. FDA
concludes that to require such facilities to keep records of each
individual recipient consumer would be too burdensome, and not
necessary to help address credible threats of serious adverse health
consequences or death to humans or animals. If a traceback or trace
forward is necessary, FDA can learn from sickened consumers the sources
of the food they purchased, or notify consumers generally about food
that presents a threat. Therefore, FDA is changing the final rule from
the proposal so that it does not require records of subsequent
recipients for sales directly to consumers, regardless of whether the
seller is a retailer or another type of entity. The final rule excludes
persons who distribute food directly to consumers from keeping records
of those transactions. Moreover, if a person prepares and sells food
directly to consumers for immediate consumption, then those sales
qualify for the restaurant exemption.
However, persons who operate retail food establishments that
distribute food to persons who are not consumers are subject to all of
the requirements in subpart J of this final rule. However, the
requirements in Sec. 1.345 of the final rule to establish and maintain
records to identify the nontransporter and transporter immediate
subsequent recipients that are not consumers applies as to those
transactions only to the extent the information is reasonably
available.
Furthermore, retail food establishments that employ 10 or fewer
full-time equivalent employees are excluded from all of the
requirements of subpart J of this final rule, except the record access
provisions for existing records under Sec. Sec. 1.361 and 1.363.
4. Fishing Vessels
FDA received no comments on this issue and has made no changes to
the definition for fishing vessels or to the exemption in the final
rule.
5. Retail Facilities
(Comment 38) One comment states that it operates a business that is
essentially the same as any other retailer (although they sell to
restaurants). Sales to its customers are recorded using a checkout
register, and thus, it should not be required to keep records of
individual items purchased by customers. Requiring such records from
it, but not requiring retailers to keep such records, would be unfair
and would be extremely burdensome.
(Response) The business described in the comment is not treated
differently than other retailers. Persons who distribute food to
businesses do not qualify for the exclusion for sales to consumers in
Sec. 1.327(d) of the final rule. Thus, sales of food to restaurants
require the establishment and maintenance of records of the immediate
subsequent recipient, as codified in Sec. 1.345 of the final rule, to
the extent that information is reasonably available to you. Information
is reasonably available to you if you have a system in place to capture
the information. FDA does not intend to require the reconfiguration of
business operations. Thus, for example, information is reasonably
available to you when the purchaser has an established commercial
account to which the food purchases are charged in an identifiable
manner. Accordingly, Sec. 1.327(e) of the final rule provides that
persons who operate retail food establishments that distribute food to
persons who are not consumers are subject to all of the requirements in
subpart J of this final rule. However, the requirements in Sec. 1.345
of the final rule to establish and maintain records to identify the
nontransporter and transporter immediate subsequent recipients that are
not consumers applies as to those transactions only to
[[Page 71576]]
the extent the information is reasonably available. For purposes of
this section, ``retail food establishment'' is defined to mean an
establishment that sells food products directly to consumers as its
primary function. The term ``consumers'' does not include businesses. A
retail food establishment may manufacture/process, pack, or hold food
if the establishment's primary function is to sell from that
establishment food, including food that it manufactures/processes,
packs, or holds, directly to consumers. A retail food establishment's
primary function is to sell food directly to consumers if the annual
monetary value of sales of food products directly to consumers exceeds
the annual monetary value of sales of food products to all other
buyers. A ``retail food establishment'' includes grocery stores,
convenience stores, and vending machine locations.
In addition, a retail food establishment that employs 10 or fewer
full-time equivalent employees is excluded from all of the requirements
of this subpart, except the records access provisions for existing
records under Sec. Sec. 1.361 and 1.363. Given the large number of
establishments that would be excluded and the significant cost
reduction, FDA has analyzed the impact on its ability to efficiently
and effectively conduct a tracing investigation to address credible
threats of serious adverse health consequences or death. FDA believes
the information as to the source of the food of concern sold at these
establishments may be obtainable from a larger retail food
establishment that is covered by the regulations and sold the same
food. Specifically, many of the foods sold at very small retail food
establishments are nationally distributed and are also sold at covered
retail establishments. If there is an outbreak and product could also
be traced to a covered retailer, then FDA could use that retailer's
records to identify the source of the food.
Moreover, given the relatively small size of the exempted
establishments, the exempted establishments are likely to have fewer
products and suppliers than other retail establishments and are
therefore more likely to be able to provide FDA with source information
even if they are exempted from records establishment requirements. With
larger retailers, the records of immediate previous sources are more
critical to isolating quickly potential sources of food that poses a
threat of serious adverse health consequences or death to humans or
animals. The exclusion is based on the number of employees at each
retail food establishment and not the entire company, which may own
numerous retail stores.
(Comment 39) One comment argues that distributors for direct
selling companies should be exempt from the requirement to maintain
records concerning immediate subsequent recipients. The proposed
regulation would have a significant impact on the direct selling
industry. Independent distributors sell product not only to consumers,
but also to other independent distributors in their network to support
each others' businesses and enable them to fulfill customer orders.
In addition, FDA should acknowledge the unique, closed distribution
model of the direct selling business and exempt independent
distributors in a direct selling organization from the requirement to
maintain records concerning the immediate previous source. In the
closed distribution model of direct selling, the direct selling company
is the source of all products sold by its distributors. Distributors
typically obtain the products they redistribute directly from the
direct selling company with which they are associated. Under the
proposed regulations, the direct selling company will maintain records
that identify the carriers and the distributors who are the immediate
subsequent recipients of the product. Any records maintained by the
distributor regarding the immediate previous source for such shipments
would be wholly duplicative of the records held by the direct selling
company.
(Response) Whether these ``independent distributors'' are subject
to the requirement to establish and maintain records to identify the
immediate subsequent recipients depends on the nature of their
customers. Section 1.327(d) of this final rule excludes persons who
distribute food directly to consumers from the requirement in Sec.
1.345 of this final rule to establish and maintain records of the
nontransporter and transporter immediate subsequent recipients. As
discussed in response to comment 37, FDA concluded that to require such
records would be too burdensome and not necessary to help address
credible threats of serious adverse health consequences or death to
humans or animals. Thus, independent distributors are not required to
maintain records of subsequent recipients who are consumers.
Independent distributors, however, are required to keep records of
subsequent recipients who are not consumers. However, an independent
distributor who qualifies as a retail food establishment under Sec.
1.327(e) of the final rule that also distributes food to persons who
are not consumers is required to identify the nontransporter and
transporter immediate subsequent recipients as to those transactions
only to the extent the information is reasonably available. FDA needs
such records to quickly and effectively traceback and trace forward in
the event of a food-related emergency. However, an independent
distributor who qualifies as a retail food establishment that employs
10 or fewer full-time equivalent employees is excluded from all of the
requirements in this subpart, except the record access provisions for
existing records under Sec. Sec. 1.361 and 1.363.
(Comment 40) One comment asserts that there is no added public
health protection from requiring retailers to establish and maintain
records of the immediate previous holder of a food product. The
proposed rule ensures that all information desired by FDA (e.g., the
product and lot number going to a particular retail store) is already
recorded by both the distributor of the product and by the transporter
of the product. Therefore, traceability of a product will exist without
requiring the retailer to also keep that information. The comment
believes that the added burden of requiring retailers to establish and
maintain records on immediate previous sources of the food it receives
is not necessary based on the limited public health and safety benefit
that would result.
(Response) As discussed in response to comment 37 of this document,
the Bioterrorism Act did not exempt retail food establishments from
recordkeeping requirements. FDA decided to exclude persons who
distribute food directly to consumers from the requirement to establish
and maintain records of subsequent recipients because sick consumers
can provide information as to where they obtained food in a traceback,
and FDA can notify consumers of a food threat in a trace forward. In
the case of a traceback from a retailer, the retailer's records of the
immediate previous sources are needed by FDA to address credible
threats of serious adverse health consequences or death to humans or
animals. In a traceback, it is unlikely that a retailer's source for
certain foods would be apparent. Accordingly, in order for FDA to be
able to identify the retailer's immediate previous nontransporter and
transporter sources, to gain access to those sources records and
identify its sources or other recipients of the food, the retailer has
to have records identifying those sources. Therefore, the final rule
requires retailers to establish
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and maintain records containing this information. However, retail food
establishments that employ 10 or fewer full-time equivalent employees
are excluded from all of the requirements in subpart J of the final
rule, except Sec. Sec. 1.361 and 1.363. (See response to comment 38 of
this document for a further discussion of FDA's rationale underlying
this exclusion.)
(Comment 41) One comment states that a ``retail facility'' is
defined as a facility that sells food directly to consumers only. Thus,
a warehouse store or ``cash and carry'' store that sells food both to
consumers and to commercial accounts would not qualify for this
exemption. As the name implies, a ``cash and carry'' store sells food
products to anyone who wishes to buy bulk quantities in cash
transactions (e.g., from an individual consumer planning a party or
providing for a large family to intermittent supply to restaurants).
Such stores typically do not retain detailed records of cash sales. For
cash and carry stores that do engage in regular commercial
transactions, or which provide credit to commercial customers, ordinary
business practices should normally generate records that could be
tailored to serve the requirements of the proposed rule. FDA should
clarify that, if an entity conducts both exempt and nonexempt
activities at the same location, it would be required to retain records
only with respect to its nonexempt activities. Under such a
clarification, a ``cash and carry'' store that sells food to individual
consumers would not be required to maintain records regarding its
retail sales to consumers. The comment requests that the agency adopt
and confirm this interpretation.
(Response) FDA agrees. Section 1.327(d) of the final rule excludes
persons who distribute food directly to consumers from the requirement
to establish and maintain records of the immediate subsequent
recipients of food. Therefore, a ``cash and carry'' store is not
required to maintain records regarding its sales to consumers. However,
under Sec. 1.327(e) of the final rule, persons who operate retail food
establishments that distribute food to persons who are not consumers
are subject to all of the requirements in subpart J of this final rule.
However, for retail food establishments, the requirements in Sec.
1.345 of the final rule to establish and maintain records to identify
the nontransporter and transporter immediate subsequent recipients that
are not consumers applies as to only those transactions involving
nonconsumers and only to the extent the information is reasonably
available. For purposes of this section of this document, retail food
establishment is defined to mean an establishment that sells food
products directly to consumers as its primary function. The term
``consumers'' does not include businesses. A retail food establishment
may manufacture/process, pack, or hold food if the establishment's
primary function is to sell from that establishment food, including
food that it manufactures/processes, packs, or holds, directly to
consumers. A retail food establishment's primary function is to sell
food directly to consumers if the annual monetary value of sales of
food products directly to consumers exceeds the annual monetary value
of sales of food products to all other buyers. A ``retail food
establishment'' includes grocery stores, convenience stores, and
vending machine locations. In addition, retail food establishments that
employ 10 or fewer full-time equivalent employees are excluded from all
of the requirements in subpart J of this final rule, except record
access provisions for existing records under Sec. Sec. 1.361 and
1.363.
(Comment 42) One comment states that, in the case of control state
retail operations, keeping detailed information on the immediate
subsequent recipients would impose an administrative burden. Although
retailers are generally exempt from keeping records pertaining to their
customers, the exemption is lost when, as is the case with control
states, retail stores sell to other retailers, in this case
restaurants, taverns, and bars who subsequently resell the alcoholic
beverages being purchased to end-use customers. The retail store
transactions are essentially the same type of ``over the counter''
transactions that take place between the stores and individual
consumers. Some information is usually and customarily maintained
(e.g., the information pertaining to the licensed purchaser and what is
being purchased), although in some cases such information is not
generally secured and retained. The comment further notes that some of
the information sought (e.g., lot and other product identifiers) is
neither generally secured, nor is it maintained.
(Response) Section 1.327(d) of the final rule excludes persons who
distribute food directly to consumers from the requirement to establish
and maintain records of the immediate subsequent recipients of food. As
discussed in response to comment 37 of this document, such sales are
excluded because FDA can learn from sickened consumers about the
sources of food they purchased or notify consumers generally about food
that presents a threat. However, this rationale is not applicable when,
as described in the comment, retail stores sell to other retail stores.
Under Sec. 1.327(e) of the final rule, persons who operate retail food
establishments that distribute food to persons who are not consumers
are subject to all of the requirements in subpart J of this final rule.
However, for retail food establishments, the requirements in Sec.
1.345 of this final rule to establish and maintain records to identify
the nontransporter and transporter immediate subsequent recipients that
are not consumers applies as to only those transactions and only to the
extent the information is reasonably available. In addition, a retail
food establishment that employs 10 or fewer full-time equivalent
employees is excluded from all of the requirements in subpart J of this
final rule, except Sec. Sec. 1.361 and 1.363. (See response to comment
38 of this document for a further discussion of FDA's rationale
underlying this exclusion.)
In regard to lot identification numbers, retailers are not required
to maintain this information. The final rule only requires that persons
who manufacture, process, or pack food record lot or code numbers or
other identifiers of that food (and only to the extent this information
exists) (Sec. Sec. 1.337(a)(4) and 1.345(a)(4) of the final rule).
(Comment 43) One comment argues that the proposed retail exemption
(Sec. 1.327(d)) must be a complete exemption, including an exemption
from recordkeeping regarding suppliers, identical to the exemption
given to restaurants. The comment states that today retailers and
restaurants compete in the burgeoning take home and carryout market.
FDA's proposal gives an unfair and unnecessary advantage to
restaurants, which are expanding out of in-restaurant dining into areas
formerly served by retailers and carryout establishments. A full
exemption for retailers presents no lessening of food safety
safeguards.
(Response) ``Restaurant'' is defined to mean ``a facility that
prepares and sells food directly to consumers for immediate
consumption.'' This means that an establishment that prepares and sells
food that is capable of being eaten immediately, with no further
preparation, is considered a restaurant. This definition and the
corresponding exemption for restaurants in Sec. 1.327(b) of the final
rule includes activities such as a restaurant preparing and selling
food to a consumer to be consumed at a later time, as long as the food
is
[[Page 71578]]
capable of being immediately consumed without further preparation or
processing. For example, a restaurant may prepare and sell pies from a
counter that consumers purchase and take home for later consumption.
This activity qualifies for the restaurant exemption as long as the
food is prepared and sold directly to a consumer for immediate
consumption.
In addition, a restaurant/retail facility is excluded from all of
the requirements in subpart J of this final rule if its sales of food
it prepares and sells to consumers for immediate consumption are more
than 90 percent of its total food sales. FDA notes that many facilities
that otherwise would be excluded as restaurants under the final rule
sell a small amount of food that they do not prepare for immediate
consumption. For example, some restaurant/retail facilities have small
packaged goods gift shop areas that sell food. The entire facility is
excluded from all of the requirements in subpart J if its sales of food
it prepares and sells to consumers for immediate consumption are more
than 90 percent of its total food sales. FDA exercised its discretion
and excluded restaurant/retail facilities whose nonrestaurant food
sales are less than 10 percent of their total food sales because many
facilities that would otherwise qualify as restaurants make such sales
as an incidental activity (Ref. 14). FDA believes that, were it not to
provide such an exclusion, the exemption for restaurants would be
undermined because many facilities that prepare and sell a high
percentage of their food for immediate consumption also sell a small
amount of packaged goods that they do not prepare themselves for sale
to consumers (e.g., beverages, chips, candy, condiments, and
sweeteners) and otherwise would be subject to the rule as to those
sales.
Conversely, if a restaurant/retail facility's sales of food it does
not prepare and sell for immediate consumption are 10 percent or more
of its total food sales, FDA believes that such sales are a significant
portion of the facility's activities. Such a facility's retail food
sales are exempt only from the requirement to establish and maintain
records of sales to consumers. The restaurant/retail facility's sales
of food it prepares and sells for immediate consumption remain exempt
from all of the requirements of subpart J of this final rule. As noted
earlier, retail facilities are required to keep records of sales to
nonconsumers only to the extent that information is reasonably
available.
Section 306 of the Bioterrorism Act specifically exempts
restaurants, but not retailers. FDA believes persons, including
retailers, must establish and maintain records of immediate previous
sources to ensure that FDA can quickly and effectively conduct a
traceback in a food-related emergency. However, a retail food
establishment that employs 10 or fewer full-time equivalent employees
is excluded from all of the requirements of this final rule, except
Sec. Sec. 1.361 and 1.363. (See response to comment 38 of this
document for a further discussion of FDA's rationale underlying this
exclusion.)
(Comment 44) Several comments state that, although they make every
effort to provide food to their customers in a timely and efficient
manner, a small percentage of the food that is in a grocery store is
sent to a reclamation center from which it is either returned to the
manufacturer or sent to food banks. Reclamation centers are currently
the largest single source of food donations for food banks. Food may be
sent to reclamation centers if its packaging is damaged or if it is
past the ``best if used by'' date. The system for sending food to
reclamation centers is simple: The unsaleable products are collected in
banana cartons and then shipped to the center where the food is sorted
and either donated to charitable organizations, such as food banks, or
returned to the manufacturers. No records are kept by the store of the
foods shipped to the reclamation center.
The comment states that FDA's regulations should consider
reclamation centers and food banks to be ``consumers'' for purposes of
the recordkeeping regulations. Specifically, food retailers do not
currently track the foods that are sent to reclamation centers, nor is
there a mechanism available to do so. The requirement to develop and
implement new recordkeeping systems would be a serious disincentive to
corporate food donations and, again, would serve no purpose with
respect to food security. If it is not necessary to track product to
individual consumers to enhance food security, no purpose is served by
monitoring those products that are sent through reclamation centers to
consumers. Any products that are returned to the manufacturer are
removed from the food distribution system so they will not reach
consumers and their whereabouts need not be accounted for. Accordingly,
FDA should broaden the exclusion for retailers to include food products
that are routed to consumers through reclamation centers.
(Response) FDA agrees. FDA is exempting nonprofit food
establishments that prepare or serve food directly to the consumer or
otherwise provide food or meals for consumption by humans or animals in
the United States. ``Nonprofit food establishment''