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Explore This IssueOctober/November 2013
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Major U.S. food industry associations and consumer groups are guardedly optimistic that the FDA’s recently proposed regulations on import safety and third-party auditors will improve the safety of food products obtained from foreign countries. But experts also warn that the additional costs of complying with the new rules including obtaining audits and certifications, recordkeeping, and reporting will be passed onto consumers through higher prices.
The draft regulations, published in the Federal Register on July 29, 2013 to implement portions of the Food Safety and Modernization Act (FSMA), are intended to hold imported food to the same safety standards as domestically produced products. But there are also concerns that foreign companies will be held to more stringent requirements, such as undergoing audits by independent third parties. This, some experts say, might spark complaints from major trading partners because U.S. companies are not subject to the same requirements.
“If the U.S. is to stay commensurate with the World Trade Organization, whatever the U.S. government will require of foreign facilities also needs to be required of domestic companies,” says Craig Henry, a director at Deloitte & Touche LLP. “However, the third-party accreditation rule focuses only on foreign facilities. Therefore, it may be possible for U.S. trading partners to raise concerns unless U.S. exporters are held to the same standards,” Henry tells Food Quality & Safety magazine.
David Acheson, MD, director of the food and import safety practice at Leavitt Partners and a former FDA associate commissioner of foods, agrees. “We may see some pushback on trade issues. The biggest red flag is that we’re going to require importers to do different things and, on the face of it, it isn’t equal,” Acheson tells Food Quality & Safety. “We will see more noise and traction around that than anything else.”
Under the new proposed rules, U.S. importers, for the first time, must verify that their suppliers are meeting U.S. food safety requirements no matter where food is produced. In general, importers would be required to have a plan in place for each imported food, including identification of likely hazards associated with each food, and conduct activities to reasonably assure that those hazards are adequately controlled. “These proposed rules, as envisioned by the statute, rely on strong partnerships with industry and foreign governments to ensure the safety of their food products,” says Michael R. Taylor, deputy FDA commissioner for foods and veterinary medicine.
The need for such controls is growing. About 15 percent of all U.S. food is imported, including 80 percent of seafood, about 50 percent of fresh fruits, and 20 percent of fresh vegetables. Despite this volume, FDA physically inspects less than 2 percent of all food imports. The two new rules “will help prevent food safety problems before foods arrive in the U.S. instead of relying primarily on catching problems at the port,” Taylor tells Food Quality & Safety. “They are central to the FDA’s vision of a system that provides significantly elevated assurances about the safety of food consumed in the United States moving in international trade and creates a level playing field for producers and processers in the United States and abroad.”
This might spark complaints from major trading partners because U.S. companies are not subject to the same requirements.
FSMA requires FDA to create the Foreign Supplier Verification Programs for Importers of Food for Humans and Animals (FSVP) and Accreditation of Third-Party Auditors. The FSVP defines U.S. importers as either the U.S. owner or consignee at the time of entry, the U.S. agent, or the U.S. representative of the foreign owner or consignee. The importer is required to develop, maintain, and follow a verification program for each food it imports (unless the food is exempted). Some of the required activities include the following.
Compliance status review. Before importing the food and periodically thereafter, importers must review the compliance status of the food and the supplier. This includes the existence of any FDA warning letters, import alerts, and certain certification requirements.
Hazard analysis. Importers must identify and analyze any hazards that are reasonably likely to occur in each food and evaluate the severity of illness or injury that might develop.
Verification activities. To provide assurances that risks are controlled, importers must conduct verification activities such as onsite auditing of foreign suppliers; periodic or lot-by-lot sampling and testing; periodic review of foreign supplier food safety records; or other “appropriate” risk-based procedures. Instead of performing an audit, an importer may use an FDA inspection or inspection by a recognized food safety authority in the foreign country if it has been conducted within the previous 12 months.
Corrective actions. Importers must review any complaints they receive, investigate the cause or causes of adulteration or misbranding, take corrective actions, and revise their FSVPs if deemed inadequate.
Periodic reassessments. Importers must reassess their FSVPs at least every three years or sooner if they become aware of new information about potential hazards, such as changes to the source of raw materials or product formulation.
Recordkeeping. Importers must keep records documenting all of the above.
The food safety law exempts from FSVP imported juice and seafood from facilities that comply with HACCP regulations because importers are already subject to supplier verification requirements. “Requiring supplier verification for these foods under the FSVP regulations would be duplicative,” Taylor explains. Modified FSVP requirements apply to imported dietary supplements and components; food imported by “very small” importers or from “very small” foreign suppliers (having no more than $500,000 in annual sales); or food from a foreign supplier in good standing in a country whose food safety system is recognized by FDA as equivalent to that of the U.S. (such as New Zealand).
FSMA also requires FDA to establish a program for the Accreditation of Third-Party Auditors for foreign food facilities. In this, FDA will recognize accreditation bodies which, in turn, will accredit third-party auditors to conduct food safety audits and issue certifications for foreign facilities and food. The FDA is also developing draft model standards by which organizations would qualify for accreditation, such as minimum education and experience levels for their auditors and audit agents. By law, FDA is to look to already existing standards, such as international voluntary consensus standards and current practices of accreditation bodies.
The third-party auditor could be a foreign government, a foreign cooperative, or other third party as long as it has legal standing and meets other standards, such as for competency. Third-party auditors are to conduct “vigorous audits,” submit reports of audits used for certification purposes to the FDA, and notify the agency if they find any serious public health risks. This program will become the basis for the upcoming Voluntary Qualified Importer Program, which will allow expedited review and entry into the U.S. of food produced by certified foreign facilities. While the FSVP does not require importers to use accredited third-party auditors, the FDA anticipates that importers may increasingly rely on them once the program is in place.
The FDA estimates compliance with the new rules will cost the U.S. food industry about $500 million annually.
Pros and Cons
Reaction to the two rules from industry and trade groups has been generally, if cautiously, favorable. David Gombas, senior vice president for food safety and technology at United Fresh Produce Association, says, “Initially we don’t see any surprises in FDA’s draft rules on imported foods and third-party auditor accreditation. However, it’s important that we thoughtfully review them in a line-by-line fashion, including analysis of their interaction with other FSMA draft rules, to ensure they advance food safety and are workable for the industry.”
“With the release of the draft import rules, we are one step closer to the safer food supply,” says Sandra Eskin, director of food safety at Pew Charitable Trusts. “By holding overseas producers to U.S. food safety standards, the new rules would establish a level playing field that would also benefit U.S. businesses, farmers, and food processors,” she said in a statement.
“Supplier verification means that companies should know who they are buying from—not just their name and address, but their food safety practices,” says Caroline Smith DeWaal, food safety director at the Center for Science in the Public Interest. “When these rules are eventually implemented they will, at long last, give the FDA strong tools to improve the safety of imported foods.”
“Globalization has added additional layers, fragments, and complexities to the food supply chain, which have increased the number of points where the supply chain is vulnerable to food contamination, counterfeits, and mislabeling,” says Michael Lucas, CEO of track and trace provider Frequentz. The new rules “show a major shift in thinking in the way the government works to keep food safe—stressing prevention and making businesses more responsible for the food they are selling or importing by proving that they are using good food safety practices,” he tells Food Quality & Safety.
But others see a downside because of added complexity and costs. “There is a presumption in this foreign supplier verification proposal about the extent of influence and control an American importer will have over his suppliers,” says Susan Kohn Ross, an international trade specialist at the law firm of Mitchell Silberberg & Knupp in Los Angeles. “While the large companies will be able to comply with some adjustments to existing procedures, this proposal is a real headache, recordkeeping nightmare, and cost burden for small and medium-sized companies,” she wrote in a recent analysis.
The FDA estimates compliance with the new rules will cost the U.S. food industry about $500 million annually. “For sure, increased costs will be passed onto the consumer for these compliance mechanisms to take place,” Acheson says. And while some food importing companies have been anticipating the rules, others have not. ”For many importers, the rules will come as a bit of a surprise. We’re going to see confusion, surprise, and concern,” Acheson predicts.
The two rules are open for public comment until November 26, 2013. The FDA has extended the deadline for commenting on two earlier draft regulations—for produce safety and preventive controls for human food—until November 15, 2013. This was done to give people time to consider how the four rules interrelate. (A fifth FSMA rule on preventive controls for animal food is expected to be issued by November 2013.)
Agres is based in Laurel, Md. Reach him at firstname.lastname@example.org.