Customs, Import, FDA and International Trade Law
Samples of numerous articles published by Mr. Cooper follow. A law review article by Mr. Cooper is found at 14 USF Law Review 607, 1980.
August 23, 2019
ACTIVE ENFORCEMENT OF FSVP HAS BEGUN (Published in the August, 2009, Info Expeditor, Customs Brokers and Freight Forwarders Association of Northern California)
By Gary C. Cooper
The U.S. Food and Drug Administration (FDA), in partnership with CBFANC, recently held a Round Table Session at FDA facilities in South San Francisco. A number of subjects were discussed, but one in particular stood out: FDA is now actively enforcing the Foreign Supplier Verification Program (FSVP) requirement for importers of food products.
As most Customs brokers should now be aware, FSVP puts the onus squarely on importers to provide adequate assurance that foreign suppliers of imported food adhere to risk-based preventative controls. There are various processes and procedures that may be acceptable to accomplish this depending upon the risk of the hazard and other factors.
While it should not be considered the duty of the Customs broker to assume responsibility for their importers’ compliance with FSVP, brokers should be aware of the law generally and, at a minimum, should consider advising all food import clients of its existence. Food importers generally must have an FSVP for each food product imported and be ready for FDA enforcement activities. The Customs broker can and probably should advise them to be ready.
MANY IMPORTERS ARE STILL IN THE DARK ON FSVP REQUIREMENTS
One prominent thread running through the Round Table discussion was that many importers still have no knowledge of FSVP – FDA has visited many facilities to evaluate FSVP compliance only to be told by importers (1) that they have none and (2) that they have no knowledge of the requirement. Inasmuch as active enforcement has begun after a years-long educational and rulemaking period, such a compliance response would seem inadequate. In fact, it may lead to the importer and its products being added to an import alert. This would effectively curtail entry privileges for the product and company at issue until an acceptable FSVP is in place.
A SHORT HISTORY OF THE FSVP REQUIREMENTS
A short history of FSVP (a part of the Food Safety Modernization Act):
1. The Food Safety Modernization Act (FSMA) was signed into law by President Barack Obama on January 4, 2011.
2. On July 29, 2013, the FDA published a proposed rule requiring importers to create, maintain and adhere to an FSVP for each food it imports from each respective supplier.
3. Rulemaking and attendant changes to the proposed regulations proceeded during the next two years.
4. On November 13, 2015, the FDA issued its final food safety rule establishing FSVP requirements for importers.
5. Numerous outreach programs by FDA and industry groups have been held from the time of FSMA enactment to the present.
6. The deadline for having a functioning FSVP for many importers of FDA-regulated food products was May 30, 2017.
7. For other importers, the deadline was later; for example, for an importer from a foreign supplier that is a small business the compliance deadline was March 19, 2018; if the foreign supplier is considered a “qualified facility” (including very small businesses) the deadline was March 18, 2019.
8. With very few exceptions, however, most importers are now subject to FSVP requirements; the requirements may be different, however, depending on the size of the foreign supplier or the importer; modified programs are allowed for certain small and very small businesses.
FIRST WARNING LETTER ISSUED UNDER FSVP ON JULY 30, 2019
Again, the FDA has made numerous recent visits to “FSVP”- importers to assess their degree of compliance with the new rules; importers large and small have been subject to this scrutiny and most have cooperated.
From informal reports and discussions, FDA officials have been flexible, instructive and generally have not taken any adverse action against importers. This approach recently may have changed, however.
July 30, 2019, a warning letter from FDA was issued to a Jupiter, Florida, firm for failure to develop an FSVP for certain imported sesame paste tahini (CMS # 583679). Upon inspection of the company facilities, it was found in violation. The company had failed to verify that its imported food had been produced in a manner that met applicable U.S. food safety standards.
While the warning letter indicates FDA is now entering an active enforcement phase for FSVP and this should be of serious concern to importers, it also should be viewed in context:
1. The imported product the subject of the warning letter was alleged to have been the source of a salmonella outbreak; therefore, the inspection was not random.
2. Rather, the inspection occurred as part of a serious food safety investigation with possible life-threatening consequences.
3. Even with the seriousness of the violation, only a warning letter was issued; the importer was not immediately added to an import alert requiring its food imports be detained without physical examination.
4. To the firm’s credit, it did immediately and voluntarily recall the allegedly tainted tahini.
5. On the other hand, at the time the warning letter was issued, FDA indicated the firm had not yet addressed its FSVP violations and had indicated earlier it was completely unfamiliar with FSVP requirements.
In sum, this warning letter, while a serious and consequential development, may not be of immediate pertinence to most importers. General inspections will likely continue to occur and an importer will likely be given a chance to fully comply before immediate adverse enforcement action. Conversely, if there is an outbreak of tainted food and it is traced back to an importer without a proper FSVP, expect active enforcement – in fact, these outbreaks are the very consequence FDA and the food safety apparatus were targeting by enactment of FSMA and FSVP.
More information on the warning letter can be found at: https://www.fda.gov/news-events/fda-brief/fda-brief-fda-issues-first-warning-letter-importer-tahini-implicated-recent-salmonella-outbreak.
WHAT ARE THE RESPONSIBLITIES OF CUSTOMS BROKERS AND IMPORTERS PARTICULARLY NOW THAT THERE IS ACTIVE FSVP ENFORCMENT?
It was clear from the recent FDA - CBFANC Round Table session that many importers remain completely unaware of the FSVP requirements and, to the extent they are familiar with the law, there is a great deal of confusion – Customs brokers should immediately evaluate informing their food importers of FSVP and advising them on compliance alternatives. Customs brokers themselves are not subject to FSVP, of course, only importers. A broker will likely want to discuss the law with all food clients, however, if only to disclaim any duty to provide FSVP services.
Furthermore, a Customs broker may wish to avoid trying to educate an importer on the specific requirements of FSVP unless they have an expertise in the area. Rather, all food importers probably should be advised to act immediately on their own to qualify at least a single individual at their firm for FSVP development. The FSVP regulations require an importer to have a “qualified individual” for FSVP purposes and many classes from the private sector are provided for this purpose.
The regulations for Foreign Supplier Verification Programs for Food Importers. At 21 CFR 1.500 provides:
"Qualified individual means a person who has the education, training, or experience (or a combination thereof) necessary to perform an activity required under this subpart, and can read and understand the language of any records that the person must review in performing this activity. A qualified individual may be, but is not required to be, an employee of the importer. A government employee, including a foreign government employee, may be a qualified individual."
The FDA recommends all firms designate such individual and, unless already fully trained, have them participate in a class specifically designed to teach FSVP requirements. This individual can then return to the firm with the specialized knowledge to develop valid, acceptable FSVP plans. Additionally, this advice to an importer should dispatch any broker responsibility going forward. FSVP should be administered by the importer with the detailed and specific knowledge taught by the available classes.
CAUTION: The inevitable question will still come up. “We’re a very small importer, we’re exempt from the law, right?”
Not right. There are modified requirements for certain small and very small companies, but there are still requirements. I recommend the FSVP classes even for small or very small companies so they can be made aware of their responsibilities under the law, which remain significant, and then fully comply.
Gary C. Cooper
Law Offices of Gary C. Cooper
247 Yale Avenue
Kensington, CA 94708
(510) 665-5555
(510) 697-5140
fax: (510) 665-4109
April, 2009
USDA COMPLIANCE AND ENFORCEMENT INITIATIVE ON POULTRY AND EGG PRODUCTS (Published in the April, 2009, Info Expeditor, Customs Brokers and Freight Forwarders Association of Northern California)
By Gary C. Cooper
For years, products containing small amounts of poultry have been imported into the United States without strict governmental scrutiny of the origin of the ingredients. These products were generally considered “exempt” from United States Department of Agriculture (“USDA”) origin and inspection regulations for poultry because of the small amount of that ingredient they contained. Thus, since they were “exempt,” they could be imported from any country, not just the limited number of countries approved for export of poultry to the United States.
Although some low-volume, sporadic enforcement has taken place in past years, it has come as a surprise and shock to many in the Asian Food importing community that the Food Safety Inspection Service (“FSIS”) of the USDA has now begun aggressively applying an obscure but longstanding regulation. This regulation requires that the poultry used to produce a final “exempted” imported product must separately meet certain mandated origin and inspection requirements. This standard is being enforced regardless of the fact that the imported poultry product by itself may be exempt from such a restriction.
What happened? The answer depends on whom you ask. Generally, however, most agree the current problems stem from the increased enforcement profile to imported poultry products from China due to Section 733 of the H.R. 2764 (Consolidated Appropriations Act for fiscal year 2008) which provides:
Sec. 733. None of the funds made available in the Act may be used to establish or implement a rule allowing poultry products to be imported into the United States from the People’s Republic of China. [This provision has since been extended twice and remains current.]
As a consequence, this seemingly obscure section to an appropriations bill has brought political and bureaucratic scrutiny to a longstanding practice, i.e., the allowance of products with small amounts of poultry to be imported into the United States from China and, attendantly, other “non-approved” countries. This has occurred despite regulations which, in retrospect, may have prohibited these importations all along. It was as if the authorities were suddenly surprised that chicken based products made from uninspected poultry ingredients were being imported from “unapproved” countries. (China at one time was approved for export of poultry the United States before the enactment of HR 2764, although no specific factories had been approved.)
It should not have been so much of a surprise. Prior to importation, these products have generally been approved for Veterinary Service permits (VS Form 16-6A) by a separate arm of the USDA, the Animal and Plant Inspection Health Service (“APHIS”). The origin of the poultry ingredients, most often from an unapproved (often Asian) country, was clearly stated on the face of the approved document.
These permits were regularly issued despite the longstanding regulation which would seem to restrict the importation of these goods unless the ingredients used therein met certain origin and inspection requirements. This regulation, found at Title 9, Code of Federal Regulations, section 381.15 (19 CFR § 381.15) provides, in pertinent part:
The following articles contain poultry ingredients only in a relatively small proportion or historically have not been considered by consumers as products of the poultry food industry. Therefore, said articles are exempted from the definition of poultry product and the requirements of the Act and the regulations applicable to poultry products, if they comply with the conditions specified in this section:
(a) Any human food product (in a consumer package) not provided for in paragraph (c) of this section, if: (1) It contains less than 2 percent cooked poultry meat (deboned white or dark poultry meat, or both) and/or Mechanically Separated (Kind of Poultry) as defined in 381.173; (2) It contains less than 10 percent of cooked poultry skins, giblets, or fat, separately, and less than 10 percent of cooked poultry skins, giblets, fat, and meat (as meat is limited in paragraph (a)(1) of this section) or Mechanically Separated (Kind of Poultry) as defined in 381.173, in any combination; (3) The poultry ingredients used in the product were prepared under inspection as defined in 381.1, or were inspected under a foreign inspection system approved under 381.196(b) and imported in compliance with the Act and the regulations;
* * * *
Therefore, this regulation, which also includes language applying the (a)(3) standard above to poultry broths and similar products, has specifically required “exempted” or non-poultry products to be made from properly inspected poultry from eligible countries (19 CFR § 381.15(a)(3). Although this condition would seem to contradict the very purpose of the exemption, it is “on the books” and is now being enforced.
In an apparent response to the confusion created over this enforcement initiative, the FSIS recently circulated a document entitled, “Notice of Increased Enforcement by the United States Department of Agriculture, Food Safety and Inspection Service Regarding Imported Food Products Containing Small Amounts of Meat, Poultry, or Processed Egg Product Ingredients.” It essentially gives notice of the increased enforcement for poultry (as well as meat and egg products). For meat and poultry, all new permits issued effective March 19, 2009, will have the following condition included:
Importer is also responsible for obtaining any required authorization from the USDA, Food Safety and Inspection Service (FSIS). Meat, poultry, or egg product ingredients used in FSIS-exempted products must be prepared under USDA, FSIS inspection or under a foreign inspection system approved by FSIS. Contact FSIS via e-mail at: permits@fsis.usda.gov or by telephone at: 888 287 7194 for information regarding approved foreign inspection systems and foreign establishments approved by FSIS to export to the United States. A list of countries eligible to import meat, poultry or egg products is published on the FSIS web site at the following address:
http://www.fsis.usda.gov/PDF.Countries_Products_Eligible_for_Export.pdf
Any new permit application submitted after June 19, 2009, will have to be approved by FSIS to ensure the ingredients originate from an eligible source. Supporting documentation for the importation will have to be provided to FSIS in order to allow entry into the United States. Products found ineligible for admission are subject to destruction. Additionally, any permit expiring before June 19, 2009, is eligible for a 90-day extension. At the end of the extension period, however, a new application will be required which meets the new permit conditions shown above.
The FSIS enforcement protocol will require the following types of documents “as a minimum,” that:
1. evidence the proportion of meat, poultry, or processed egg product ingredients in the product formulation;
2. identify the country of origin of these ingredients;
3. identify the establishment where these ingredients were processed;
4. provide assurance that no other meat, poultry, or processed egg product ingredient is incorporated into the finished product;
5. evidence that the product labeling does not represent the finished product as a meat food product, poultry food product, or egg product;
6. identify of the facility where the finished product, as represented by the labeling, was manufactured;
7. for products labeled as flavored, provide assurance that such products do not actually contain a meat, poultry, or processed egg ingredient.
In addition, a valid APHIS Permit Number (or Application Reference Number) must be referenced on the supporting documentation.
So, the above-discussed “notice of increased enforcement” would seem to allow a grace period for compliance with ingredient-origin requirement, correct? Not necessarily true. While the clear implication is that, until new Veterinary Service permits are issued with the newly drafted conditions, the specific documentation requirements will not be enforced, FSIS has recently presented themselves at a number of importer warehouses, credentials in hand, detaining product, threatening seizure and requesting voluntary recall of the “exempt” chicken-based products made from poultry of non-eligible countries. Fair? Maybe not. Legal? In view of the USDA, yes, although only the courts could decide definitively.
Regardless, it would seem importers should take great care in importing any poultry- based products in the immediate future, regardless of the existence of an APHIS-issued VS permit. This is particularly important for products originating in China or other Asian countries.
Egg products are also discussed in the notice of increased enforcement. FSIS is currently working on new enforcement parameters for egg products which promise to be equally restrictive to those applying to poultry-based products. The agency has said there will be a grace period for enforcement, but has also said the restriction on the use of uninspected egg products would run to items such as egg noodles, egg rolls and cakes made with eggs, all of which have egg product ingredients but do not typically require APHIS Veterinary Service permits. We will keep you informed as the FSIS publishes additional information. We expect the USDA to conduct an outreach program sometime in May, 2009.
Please feel free to contact the author with any questions or comments on this article or specific import matters.
June, 2009
UPDATE ON USDA COMPLIANCE AND ENFORCEMENT INITITATIVE ON MEAT, POULTRY AND EGG PRODUCTS (Published in the June, 2009, Info Expeditor, Customs Brokers and Freight Forwarders Association of Northern California)
By Gary C. Cooper
Attorney at Law
For questions or comments please contact the author at:
Law Offices of Gary C. Cooper
247 Yale Avenue
Kensington, California 94708
510-665-5555
510-697-5140
The Food Safety and Inspection Service (“FSIS”) and the Animal and Plant Health Inspection Service (“APHIS”) of the United States Department of Agriculture presented an outreach seminar in Berkeley, California, on June 9, 2009, in a valiant attempt to bring reason and understanding to what has become an exceedingly complex enforcement and compliance issue, i.e., how to comply with the admissibility standards of FSIS and APHIS for products with small amounts of meat, poultry and egg ingredients.
As I wrote in this newsletter two months ago, for many years products containing small amounts of poultry or processed egg have been imported into the United States without strict governmental scrutiny of the origin of the ingredients. This has changed. The longstanding requirement that these small amounts of meat or poultry be made from properly inspected poultry from eligible countries is now being vigorously enforced.
What this means to importers of food from Asian and other countries is that the meat, poultry or processed egg ingredient in imported products must originate from the United States or other eligible country and have been properly inspected before use in production. No Asian country is currently eligible to export poultry or processed egg products to the United States and therefore importers must now take steps to ensure compliance with new rules governing the eligibility and admission policies of FSIS and APHIS essentially requiring the meat, poultry and processed egg ingredients be sourced from outside the Asian country of production.
The June 9th outreach program was well attended by brokers and importers all of whom had many questions on implementation and interpretation of the law. Below are the most salient points I culled from the seminar and believe may be of interest to brokers and their clients:
1. Most importantly to the October Moon Festival celebration, the egg used in Moon Cakes is not considered “processed” and therefore is outside FSIS jurisdiction. Therefore, the source of those eggs is not restricted to “eligible” countries. Generally speaking, only processed eggs which have been pasteurized are restricted by FSIS. APHIS and the Food and Drug Administration will continue to evaluate moon cakes and similar products for compliance issues, however.
2. Starting on June 23, 2009, all APHIS permits will require FSIS review and evaluation before approval if the product contains small amounts of meat or poultry. Dr. Elliott, Director of the FSIS Import Inspection Division of the Office of International Affairs, said FSIS intends to make determinations of whether the small amount meat or poultry is from an eligible source within 48 hours of receipt from APHIS.
3. Even if an APHIS permit is not required (for example, certain baked goods), the source of meat or poultry ingredient may still be scrutinized before or after an admissibility decision is made for imported products and must meet the inspection standards of FSIS for admissibility into the United States.
4. The supporting documentation required for issuance of the APHIS permit for products with small amounts of meat or poultry may take various forms. These documents may include a bill of lading or invoice showing the source of the meat or poultry ingredient, or a statement from a government agency from which the ingredient or the finished product originated. Dr. Elliott stated FSIS does not consider a letter or written statement from the manufacturer alone to be sufficient.
5. APHIS permits for products with processed egg ingredients do not currently require supporting documentation to be submitted with permit applications. These products still must meet the standards for FSIS eligibility, however, and FSIS may audit, inspect and request evidence of source of ingredients at or after the time of importation.
6. Labeling concerns for products containing small amount of meat, poultry or egg products should be addressed to the FSIS labeling and Program Delivery Division on FSIS Form 7234-1. Generally, products containing small amounts of meat or poultry may be restricted in the label descriptions allowed. Therefore, prior approval of the label will help importers ensure that they are not improperly describing their product. Formulations and processing procedures are also reviewed during the labeling approval process and label approval may therefore help to qualify a product for exemption status during the APHIS permit approval process.
7. FSIS will continue its surveillance of all meat, poultry and egg products that have entered the United States, including products that (1) require an APHIS permit and (2) those that do not. Upon request, the importer should be prepared to provide supporting documentation to demonstrate the meat or poultry ingredient came from an approved source.
The general tenor of the meeting was relaxed and cooperative and both FSIS and APHIS representatives promised accessibility for import compliance guidance. Questions may be directed to FSIS at permits@fsis.usda.gov or at (888) 287-7194. Please keep in mind during the approval process, however, that if an importer or subsequent purchaser has shipment detained or seized, the cooperative aspect of the relationship typically changes and brokers should be ready to advise them both before and after the importation process for meat, poultry and egg products.
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