Federal Register, Volume 77 Issue 89 (Tuesday, May 8, 2012)

[Federal Register Volume 77, Number 89 (Tuesday, May 8, 2012)]
[Rules and Regulations]
[Pages 26929-26937]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-10917]

-----------------------------------------------------------------------

DEPARTMENT OF AGRICULTURE

Food Safety and Inspection Service

9 CFR Parts 304, 381, 417 and 418

[FDMS Docket No. FSIS-2008-0025]
RIN 0583-AD34

Requirements for Official Establishments To Notify FSIS of
Adulterated or Misbranded Product, Prepare and Maintain Written Recall
Procedures, and Document Certain Hazard Analysis and Critical Control
Points System Plan Reassessments

AGENCY: Food Safety and Inspection Service, USDA.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Food Safety and Inspection Service (FSIS) is implementing
provisions of the Food, Conservation, and Energy Act of 2008 by
amending the Federal meat and poultry products inspection regulations
to require official establishments to promptly notify the appropriate
District Office that an adulterated or misbranded meat or poultry
product has entered commerce; require official establishments to
prepare and maintain written procedures for the recall of all meat and
poultry products produced and shipped by the establishment; and require
official establishments to document each reassessment of the
establishment's Hazard Analysis and Critical Control Point (HACCP)
plans.

DATES: Effective Date: May 8, 2012.
Applicability Dates: Amendments to Sec. Sec. 304.3, 381.22, 417.4,
418.2, and 418.4 are applicable beginning June 7, 2012. For more
information on applicability dates, see the section titled ``Section
418.3 Effective Dates'' in the SUPPLEMENTARY INFORMATION section.

FOR FURTHER INFORMATION CONTACT: Dr. Daniel Engeljohn, Assistant
Administrator, Office of Policy and Program Development, Food Safety
and Inspection Service, Room 349-E, Jamie L. Whitten Building, 1400
Independence Avenue SW., Washington, DC 20250; Telephone (202) 205-
0495, Fax (202) 720-2025.

SUPPLEMENTARY INFORMATION:

I. Section 418.3 Effective Dates

The regulations in Sec. 418.3 are applicable as follows:
In large establishments, defined as all establishments
with 500 or more employees, November 5, 2012.
In small establishments, defined as all establishments
with 10 or more employees but fewer than 500, May 8, 2013.
In very small establishments, defined as all
establishments with fewer than 10 employees or annual sales of less
than $2.5 million, May 8, 2013.

II. Background

The Food Safety and Inspection Service (FSIS) administers a
regulatory program under the Federal Meat Inspection Act (FMIA) (21
U.S.C. 601 et seq.) and the Poultry Products Inspection Act (PPIA) (21
U.S.C. 451 et seq.) to protect the health and welfare of consumers. The
Agency is responsible for ensuring that the nation's commercial supply
of meat and poultry is safe, wholesome, and correctly labeled and
packaged.
On June 18, 2008, section 11017 of the Food, Conservation, and
Energy Act of 2008, Public Law 110-246, 122 Stat 1651, 448-49,
otherwise known as the 2008 Farm Bill, amended the FMIA and the PPIA to
require establishments subject to inspection under these Acts that
believe or have reason to believe that an adulterated or misbranded
meat or poultry product received by or originating from the
establishment has entered into commerce to promptly notify the
Secretary with regard to the type, amount, origin, and destination of
the meat or poultry product. The 2008 Farm Bill also requires that
inspected establishments: (1) Prepare and maintain written procedures
for the recall of all products produced and shipped by the
establishment; (2) document each reassessment of the process control
plans of the establishment (i.e., HACCP plans); and (3) upon request,
make the procedures and reassessed control plans available for
inspectors appointed by the Secretary to review and copy.
In the Federal Register of March 25, 2010 (75 FR 14361), FSIS
proposed regulations to implement the new provisions of the 2008 Farm
Bill. FSIS proposed to amend 9 CFR 417.4(a)(3) to require official
establishments to make a written record of each reassessment of the
adequacy of their HACCP plan, or to document the reasons for not making
a change to their HACCP plan based on the reassessment. For annual
reassessments, if an establishment determines that no changes to its

[[Page 26930]]

HACCP plans are necessary, the establishment does not have to document
the reasons for this determination. Furthermore, FSIS proposed to
establish a new 9 CFR part 418, Recalls, under which official
establishments would be required to prepare and maintain procedures for
the recall of all meat and poultry products produced and shipped by the
establishment, and to promptly notify FSIS within 48 hours if the
establishment believes or has reason to believe that an adulterated or
misbranded product received by or originating from the establishment
has entered into commerce. Interested persons were invited to submit
written comments by May 24, 2010.
After review and consideration of all comments, FSIS is finalizing,
with three changes, the provisions in the March 2010 proposed rule.
Specifically, the Agency is amending the proposal to require official
establishments to promptly notify FSIS within 24 hours if the
establishment believes or has reason to believe that an adulterated or
misbranded product received by or originating from the establishment
has entered into commerce. In addition, the Agency is amending the
proposal to require new establishments to develop their written recall
procedures at the same time as their HACCP plans in order to receive a
Federal Grant of Inspection.
Also in response to comments, FSIS has decided to stagger the
applicability date for 9 CFR part 418 based on establishment size.
Existing large establishments, defined as all establishments with 500
or more employees, will have six months from the date of publication of
this final rule in the Federal Register to prepare their written recall
procedures. Existing small establishments (those with 10 or more
employees but fewer than 500) and very small establishments (those with
fewer than 10 employees or annual sales of less than $2.5 million) will
have one year from publication of this final rule in the Federal
Register to prepare their written recall procedures. These changes are
discussed in detail in the Agency's responses to comments.

III. Summary of and Response to Comments

FSIS received 31 comments from hospitality supply companies, supply
management companies, trade groups representing meat packing and
processing establishments, a trade group representing the turkey
industry, a trade group representing food and beverage companies, a
trade group representing organic agriculture products, a representative
from a state department of agriculture, a small processing plant, a
rancher, a farmer, and 14 consumers.
A summary of issues raised by commenters and the Agency's responses
follows.

A. Notification Requirement

Comment: A few comments addressed whether 48 hours is an
appropriate time in which to expect official establishments that have
shipped or received, or have reason to believe that they have shipped
or received, adulterated or misbranded product, to notify the
appropriate District Office of that situation. A consumer and a trade
group representing the turkey industry stated that 48 hours is a
reasonable timeframe to give establishments to notify District Offices.
A trade group representing meat packing and processing establishments
also stated that the proposed time period was reasonable, but was
concerned that 48 hours may be an arbitrary figure. Three consumer
groups and an individual consumer argued the proposed timeframe is too
lax, and that establishments should notify District Offices within 24
hours if they may have shipped or received adulterated or misbranded
product. One consumer group argued that allowing official
establishments to wait as long as 48 hours before reporting this
information to the appropriate District Office will unnecessarily delay
efforts to remove adulterated or misbranded product from commerce.
Another consumer group argued that 24 hours is sufficient time for
establishments to notify District Offices that they may have shipped or
received adulterated or misbranded product because establishments may
notify the District Office by phone.
Agency's Response: FSIS agreed with commenters that 48 hours may be
too long. The Agency has concluded that because notification can be
made with a phone call, 24 hours is an appropriate time in which to
expect official establishments that have shipped or received, or have
reason to believe that they have shipped or received, adulterated or
misbranded product, to notify the appropriate District Office of that
situation. Therefore, the final rule requires official establishments
to notify the appropriate District Office within 24 hours of learning
or determining that an adulterated or misbranded product received by or
originating from the establishment has entered commerce, if the
establishment believes or has reason to believe that this has happened.
Comment: A few comments requested that the Agency provide more
guidance on when the 48-hour period would officially begin. One comment
from a consumer group argued that the proposed requirement was vague
and confusing. The commenter asked that the Agency explain how much
investigation an establishment owner will be required to make before
the notification requirement is triggered. Another comment from a trade
group representing meat packing and processing establishments
recommended that the Agency work with industry on establishing the
timeline. They requested that the Agency develop specific guidance that
outlines a step-by-step reaction process. They also requested that FSIS
consider factors such as microbial test data recovery, weekends, and
Federal holidays when deciding when the 48-hour period should
officially begin.
Agency's Response: The 24-hour period begins when the establishment
has reason to believe that a product that is in commerce is adulterated
or misbranded under the FMIA or PPIA. For example, if the results of a
laboratory analysis show that raw ground beef contains E. coli O157:H7,
or that a ready-to-eat product contains Listeria monocytogenes or any
other pathogen, the product would be adulterated. However, there also
may be situations in which laboratory results are not available, but,
based on epidemiological evidence, there may be a probability of harm
from consuming the product. Under these circumstances, the
establishment is to consider the strength of the epidemiological
evidence to determine whether there is reason to believe that the
product is adulterated or misbranded.
Comment: Two comments argued that the notification requirement is
``overly broad,'' and that minor labeling errors do not misbrand
product and should be excluded from the notification requirement. They
suggested that the Agency follow the standard established for the U.S.
Food and Drug Administration's (FDA's) Reportable Food Registry or
incorporate a de minimis standard. The FDA standard requires
notification when there is a reasonable probability that the use of, or
exposure to, the article of food will cause serious adverse health
consequences or death (21 U.S.C. 350(d)).
Agency's Response: FSIS did not accept suggestions to follow the
standard established for the FDA's Reportable Food Registry (RFR) or to
incorporate a de minimis standard. FSIS assesses the public health
concern or hazard presented by a product being recalled, or considered
for recall, and classifies the concern as one of the

[[Page 26931]]

following: (1) Class I, a health-hazard situation where there is a
reasonable probability that the use of the product will cause serious,
adverse health consequences or death; (2) Class II, a health-hazard
situation where there is a remote probability of adverse health
consequences from the use of the product; or (3) Class III, a situation
where the use of the product will not cause adverse health
consequences. If the Agency adopted the RFR standard or a similar de
minimis standard, establishments may not be required to notify FSIS
about product that could trigger a Class II or Class III recall.
Furthermore, the 2008 Farm Bill provisions do not provide for a de
minimis standard concerning the notification requirements for
establishments that may have shipped or received adulterated or
misbranded product. Consistent with the statute, and because the
notification requirement is a preventive measure that will allow FSIS
to determine more quickly whether a recall action is necessary
(including detention and seizure of product by FSIS), thereby
protecting public health, the final rule requires official
establishments to notify the appropriate District Office of all product
that is believed to be adulterated or misbranded.
FSIS is aware, however, that there can be misbranding situations
because of minor labeling deficiencies, and that these deficiencies do
not create health or safety issues or impart an economic advantage. If
a District Office, when notified by an establishment that it has
shipped or received or may have shipped or received misbranded product,
identifies the violation as one that does not create a health or safety
issue or economic impact, it will contact FSIS's Labeling and Program
Delivery Division (LPDD) about the misbranding situation. LPDD will
then contact the establishment and work with it to resolve the
situation.
Comment: Two comments submitted by consumer groups requested that
the final rule require official establishments to notify both the
appropriate District Office and FSIS headquarters in Washington, DC
They argued that because the legislation refers to notifying the
Secretary of Agriculture, and given the potential health impacts of the
recall information, data should be sent to headquarters in addition to
the local District Office.
Agency's Response: The Agency does not believe it is necessary for
official establishments to contact both the appropriate District Office
and FSIS headquarters in Washington, DC The Secretary of Agriculture
has delegated to the Under Secretary for Food Safety the responsibility
for exercising the functions of the Secretary of Agriculture under
various statutes (Section 4(a) of Reorganization Plan No. 2 of 1953 (5
U.S.C. App.) and Section 212(a)(1) of the Department of Agriculture
Reorganization Act of 1994, Public Law 103-354, 7 U.S.C. 6912(a)(1)),
while the Under Secretary for Food Safety has delegated that authority
to the Administrator of the Food Safety and Inspection Service (7 CFR
2.7, 2.18, and 2.53). In turn, each District Office, under the
direction of a District Manager, has been given the authority to manage
a farm-to-table food safety program of regulatory oversight and
inspection in a district consisting of a State or several States and
territories. Thus, the District Offices have the authority, and are
fully competent, to receive and analyze information from official
establishments about adulterated or misbranded product.
Comment: A trade group representing meat packing and processing
establishments and a trade group that represents food and beverage
companies noted that the proposed rule provides that establishments
must notify FSIS of the destination of the adulterated or misbranded
product. The two trade groups suggested that the Agency clearly state
in the preamble to the final rule that while the statutory language
specified notification of the ``destination'' of the adulterated or
misbranded product, shipping establishments only have knowledge of, and
therefore, need only provide notification about their direct
consignees.
Agency's Response: Under this rule, establishments must provide all
available information about the ``destination'' of adulterated or
misbranded product. This rule does not create a duty to seek out new
information; however, if establishments have information about the
destination of adulterated or misbranded product beyond their direct
consignees, they must provide it to the Agency.

B. Recall plans

Comment: Several comments expressed concerns about the security of
plant recall information and whether recall plans would be subject to
the Freedom of Information Act (FOIA) (5 U.S.C. 552(b)).
Agency's Response: FSIS understands the nature of these comments
and that many meat and poultry establishments view the data in recall
procedures as confidential commercial information. Pursuant to USDA's
Freedom of Information Act (FOIA) regulations (7 CFR 1.1 et seq.), FSIS
is responsible for making the determination with regard to the
disclosure or nondisclosure of information in records obtained from
businesses. When, in the course of responding to an FOIA request, FSIS
cannot readily determine whether the information obtained from a person
is confidential business information, the Agency seeks to obtain and
carefully consider the views of the business and provide the business
an opportunity to object to any decision to disclose the information.
Under this final rule, establishments are not required to submit
their recall procedures to FSIS. They must, however, make the written
recall procedures available for copying. FSIS will verify that all
establishments maintain the required written recall procedures. FSIS
will also protect establishments' confidential business information
from public disclosure to the extent authorized under FOIA and in
conformity with USDA's FOIA regulations.
Comment: Two comments questioned whether the language of the
proposed rule exceeded the provisions of the Farm Bill because it
requires official establishments to specify in their written recall
procedures how they will decide whether to conduct a product recall,
and how the establishment will effect the recall, should it decide that
one is necessary.
Agency's Response: FSIS has the authority to require official
establishments to specify in their written recall procedures how they
will decide whether to conduct a product recall, and how the
establishment will effect the recall, should it decide that one is
necessary.\1\ These requirements are also consistent with the
legislation and with longstanding Agency guidance on recall plans.\2\
---------------------------------------------------------------------------

\1\ See 21 U.S.C. 621, ``* * * and said Secretary shall, from
time to time, make sure rules and regulations as are necessary for
the efficient execution of the provisions of this Act, * * *'' and
21 U.S.C. 463(b), ``The Secretary shall promulgate such other rules
and regulations as are necessary to carry out the provisions of this
chapter.''
\2\ See ``FSIS Directive 8080.1, Rev. 6, 10/26/10, Recall of
Meat and Poultry Products, Attachment 1''.
---------------------------------------------------------------------------

Comment: Several comments suggested that the Agency execute the
rule in incremental stages based on business size, similar to the plan
used when HACCP was implemented. Two stated that six months to one year
is a reasonable time to give establishments to develop recall
procedures. One comment suggested that current establishments should be
given six months to develop recall procedures,

[[Page 26932]]

but new establishments should be required to prepare their recall
procedures at the same time as their HACCP plans. Another comment
recommended that large establishments be required to prepare their
recall procedures as soon as possible, but that small and very small
establishments be given more time to comply. Yet another comment
suggested that the Agency implement the rule for large establishments
and review the results for one year before requiring small and very
small establishments develop recall procedures.
Agency's Response: FSIS has sought to make this rule as fair and
equitable as possible, regardless of an establishment's size.
Therefore, the Agency asked for comments on when, after the effective
date of this final rule, written recall procedures must be completed in
accordance with proposed 9 CFR 418.3. Based upon the comments received,
FSIS has determined that existing large establishments will have six
months from the date of publication of this final rule to implement it
and prepare recall plans. To minimize the burden on small businesses,
small and very small establishments will have one year from the date of
publication to comply.
FSIS believes that the suggestion to require new establishments to
have prepared their recall procedures at the same time as their HACCP
plans in order to receive a Federal Grant of Inspection has merit.
Therefore, the Agency is amending 9 CFR 304.3 and 9 CFR 381.22 to
require that before being granted Federal inspection, an establishment
must have developed written recall procedures as required by part 418
of Title 9, Chapter III. The Office of Outreach, Employee Education and
Training has model recall plans available to industry.
Reassessment of HACCP Plans
Comment: Several comments supported the documenting of HACCP
reassessments, as proposed. One consumer group argued that
documentation is vital because it provides a needed safeguard against
evasion of reassessment requirements. The commenter stated that by
making records of reassessment available for official review and
copying, FSIS has the ability to preempt an outbreak by identifying
overlooked hazards.
Agency's Response: The Agency agrees with comments that the
documenting of HACCP reassessments is beneficial. The Agency believes
that documenting HACCP reassessments will facilitate verification that
establishments have appropriately reassessed their HACCP plans. It will
also help FSIS personnel to identify whether there are emerging hazards
that the establishment has decided not to address.
Comment: One comment submitted by a trade group representing meat
packing and processing establishments requested that the Agency clarify
in the final rule that simple formatting or grammar changes of a HACCP
plan do not need to be documented as reassessments.
Agency's Response: While establishments are required to document
each reassessment of their HAACP plans, the Agency does not consider
formatting and grammar changes to be reassessments.
Costs
Comment: The Agency received several comments addressing the cost
of implementing the proposed rule. One consumer group argued that the
cost of implementing the proposed rule is reasonable. The commenter
argued that if the first-year industry costs will be $5 million
dollars, that cost is far less than the billions of dollars the United
States incurs as a result of foodborne illnesses per year.
A few comments from very small processors or supporters of very
small processors or local processors claimed that additional regulation
will be an undue financial burden on small and very small
establishments. One trade group representing meat packing and
processing establishments believed that FSIS's estimated initial cost
is already a significant cost to many small and very small
establishments, and that the actual cost could potentially be much
higher. The trade group suggested that the initial cost to small and
very small establishments might be $2,000; however, the trade group did
not offer any data to support its claim. Another comment submitted by a
consumer suggested creating waivers or exemptions for small and very
small establishments.
Agency's Response: While the Agency agrees with the commenter that
$2,000 in initial cost for small and very small establishments may be a
significant cost, FSIS estimates that the average initial (first-year)
cost of implementing this final rule for these establishments will not
be $2,000 but would be between $700 and $900, with a midpoint of
$800,\3\ for each small or very small establishment.
---------------------------------------------------------------------------

\3\ See, Table 2 (columns 7, 8, and 9), which is the updated
Table 3, Federal Register, Vol. 75, No. 57, March 25, 2010, page
14365.
---------------------------------------------------------------------------

IV. Executive Orders 12866 and 13563 and Regulatory Flexibility Act

Executive Orders 13563 and 12866 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, of reducing costs, of harmonizing rules, and of promoting
flexibility. This rule has been designated a ``significant regulatory
action'' under section 3(f) of Executive Order 12866. Accordingly, the
rule has been reviewed by the Office of Management and Budget.
FSIS has carefully evaluated the comments submitted in response to
the proposed rule and has concluded that it is appropriate to adopt the
Preliminary Regulatory Impact Analysis and the initial Regulatory
Flexibility Act (RFA) assessment as final. This Final Regulatory Impact
Analysis (FRIA) and final RFA assessment have changed from the
Preliminary Regulatory Impact Analysis and the initial RFA assessment
that were published in the proposed rule on March 25, 2010, though the
methodology remains the same.

A. Baseline

FSIS expects that this final rule will affect about 6,300 official
federally-inspected establishments that slaughter or process meat, meat
products, poultry, and poultry products, based on FSIS's Performance
Based Inspection System (PBIS) of 2011. Based on HACCP classification,
about 400 are large establishments, 3,044 are small, and 2,856 are very
small.\4\
---------------------------------------------------------------------------

\4\ Very small establishments have fewer than 10 employees or
generate less than $2.5 million in annual sales; and small
establishments have 10 or more but fewer than 500 employees and
generate more than $2.5 million in annual sales.
---------------------------------------------------------------------------

B. Expected Costs

Under the current regulations, the development and maintenance of
recall procedures and the written documentation of HACCP reassessments
are voluntary. This final rule will make them mandatory. Costs will be
incurred because about 6,300 official establishments will need to
develop recall procedures and maintain written documentation of HACCP
reassessments. Cost estimates are updated to reflect the most recent
available data.\5\
---------------------------------------------------------------------------

\5\ This includes USDA, FSIS Performance Based Inspection System
Volume Database 2011, and USDA, Economic Research Service, Food
Availability (Per Capita) Data System--Per capita food availability
data compiled reflect the amount of food available for human
consumption in the United States, March 2009, http://www.ers.usda.gov/Data/FoodConsumption.

---------------------------------------------------------------------------

[[Page 26933]]

The cost of notifying FSIS, with a few phone calls, facsimiles, or
emails about possibly adulterated or misbranded products in commerce is
negligible. FSIS has determined that there will be no impact on the
Agency's operational costs resulting from this final rule, because the
Agency will not need to add any staff or incur any additional non-labor
expenditure when the final rule is adopted.
In addition to the extra establishment labor cost, FSIS estimates
that the extra establishment material cost would be about 1 percent of
the labor cost of the development of the recall procedures and the
documentation of each reassessment of the HACCP plan. The first year
estimated average total costs to the industry are about $5.2 million
for labor (shown in Table 1) and $52 thousand (0.01 x $5.2M = $52,000)
for materials.
FSIS believes that the estimated cost of developing recall
procedures is an overestimate because: (1) Some unknown number of
establishments already have plans that could likely be adequate with
little or no change, (2) establishments in the meat and poultry
industries have differing levels of expertise in writing HACCP plans,
(3) the Agency makes model recall plans available to the industry, and
(4) establishments have a range of different processes for producing
meat and poultry products. Given the uncertainty of incurred labor cost
in different regions and with various experience levels, FSIS assumes a
20% range, plus and minus 10%, of the estimated average-compliance
cost. The estimated cost summary is shown in Table 1.
FSIS expects that in the first year of the final rule, one-time
costs for developing recall procedures would cost the industry of
approximately 6,300 establishments $4.6 million, in an estimated range
of $4.1 and $5.0 million, 10% lower and upper bound, respectively.
Furthermore, the final rule would have first year costs of
approximately $0.5 million for documenting periodic reassessments of
HACCP plans, and $0.1 million for records backup and storage, although
these costs may well be overstated. The recurring costs of developing
and updating recall procedures, documenting periodic reassessments of
HACCP plans, and records backup and storage for the second through the
tenth year are estimated at $610,000, $66,000, and $11,000,
respectively (see Table 3).
The total cost for the first year is $5.2 ($4.6 + $0.5 +$0.1)
million, in an estimated range of $4.7 and $5.7 million, 10% lower and
upper bound, respectively. Considering the subsequent years cost of
$687,000, the annualized cost over ten years using 3% and 7% discount
rates is $1.20 million ($1.08 million and $1.31 million, 10% lower and
upper bound), and $1.28 million ($1.15 million and $1.41 million, 10%
lower and upper bound), respectively (Table 3).
The present value of total costs with a 3% discount rate for 10
years would be $10.2 million, in an estimated range of $9.2 and $11.2
million. The present value of total costs with a 7% discount rate for
10 years would be $9.0 million, in an estimated range of $8.1 and $9.9
million.
Table 2 shows the first year total costs by establishment size, of
which $0.3 million is attributed to large, $2.5 million to small, and
$2.3 million to very small establishments. The first year cost per
official establishment is between $700 and $900, 10% lower and upper
bound, respectively.
Table 3 gives the estimated annualized cost and the present value
of total cost by establishment size classes for ten years. Table 3,
column 4, shows all cost categories of the first year (assumed to be
2013) and comes from Table 2, column 6, distributed by the counts of
establishment size classes. The costs for years 2--10 are based on
constant dollar assumption and are shown in Table 3, column 5.

Table 1--First Year Cost Breakdwon, in Dollars, for 6,300 Establishments (Labor and Materials)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Material
Factor for (paper, ink Low range (- High range
Cost component Response Required Wage rate paper, ink and and media) Total cost 10%) of (+10%) of
rate man-hours media cost cost (x (x $1,000) total cost total cost
$1,000)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Recall-Procedures Development (one-time).. 1 20 36 1.01 46 4,582 4,124 5,040
Document Reassessment (First Year)........ 5 0.25 63 1.01 5 501 451 551
Records Backup and Storage (First Year)... 1 0.25 36 1.50 28 85 77 94
-------------------------------------------------------------------------------------------------------------
Total................................. ........... ........... ........... .............. 79 5,168 4,651 5,685
--------------------------------------------------------------------------------------------------------------------------------------------------------

Table 2--Number of Establishments, Total and Average Costs in Size (x$1,000)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Recall
Number of procedures Documenting Records Cost per Low High
HACCP Class establishments development HACCP backup and Total cost establishment estimate (- estimate
(one-time) reassessment storage 10%) (+10%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Very Small................................ 2,856 2,077 227 39 2,343 0.8 0.7 0.9
Small..................................... 3,044 2,214 242 41 2,497 0.8 0.7 0.9
Subtotal.................................. 5,900 4,291 469 80 4,840 0.8 0.7 0.9
Large..................................... 400 291 32 5 328 0.8 0.7 0.9
-------------------------------------------------------------------------------------------------------------
Total................................. 6,300 4,582 501 85 5,168 0.8 0.7 0.9
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 26934]]

Table 3--Estimate Annualized and Present Value of the Total Cost by Establishment Size Class, Assuming Constant Dollars
--------------------------------------------------------------------------------------------------------------------------------------------------------
Present Present
2nd-10th value of value of
HACCP class Number of Activities 1st year years Annualized Annualized total total
establishment 2013 2014-22 cost at 3% cost at 7% cost at cost at
3% 7%
--------------------------------------------------------------------------------------------------------------------------------------------------------
Very Small............................ 2,856 Recall-Procedures development 2,077 278 483 517 4,118 3,634
& updating.
............. Documenting HACCP 227 30 52 56 447 395
Reassessment.
............. Records backup and storage... 39 5 9 10 76 67
-------------------------------------------------------------------
............. Subtotal................... 2,343 313 544 583 4,641 4,096
--------------------------------------------------------------------------------------------------------------------------------------------------------
Small................................. 3,044 Recall-Procedures development 2,214 296 514 551 4,387 3,872
& updating.
............. Documenting HACCP 242 32 56 60 477 421
Reassessment.
............. Records backup and storage... 41 5 9 10 78 69
-------------------------------------------------------------------
............. Subtotal................... 2,497 333 579 621 4,942 4,361
--------------------------------------------------------------------------------------------------------------------------------------------------------
Small and Very Small.................. 5,900 Subtotal of Small & Very 4,480 646 1,123 1,204 9,582 8,457
Small.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Large................................. 400 Recall-Procedures development 291 36 65 70 555 491
& updating.
............. Documenting HACCP 32 4 7 8 61 54
Reassessment.
............. Records backup and storage... 5 1 1 2 12 11
-------------------------------------------------------------------
............. Subtotal................... 328 40 74 79 628 556
--------------------------------------------------------------------------------------------------------------------------------------------------------
Total................................. 6,300 Recall-Procedures development 4,582 610 1,062 1,139 9,060 7,997
& updating.
............. Documenting HACCP 501 66 116 124 985 870
Reassessment.
............. Records backup and storage... 85 11 19 21 166 146
--------------------------------------------------------------------------------------------------------------------------------------------------------
Total 5,168 687 1,197 1,283 10,211 9,013
--------------------------------------------------------------------------------------------------------------------------------------------------------

C. Expected Benefits

The expected benefits likely to result from this final rule are
improvements in the effectiveness of the nation's food safety system
for meat and poultry products and improved protection of public health.
These benefits are not monetized because quantified data on benefits
attributable to this final rule are not available to FSIS. The expected
benefits include:
HACCP Reassessment and Documentation of Reassessments
Under this final rule, establishments must document each
reassessment, the reasons for any changes to the HACCP plan, or the
reasons for not changing the HACCP plan. For annual reassessments, if
the establishment determines that no changes are necessary,
documentation of this determination is not necessary. These provisions
will allow FSIS personnel to better verify and track that
establishments are, in fact, reassessing those plans at least annually,
as required by 9 CFR 417.4(a)(3), and that they are appropriately
responding to their findings.
Notification Requirement
This final rule is a preventive measure that will result in FSIS
being alerted to potential meat and poultry recall situations earlier
than would otherwise be the case. Under this rule, establishments will
be required to notify the local FSIS District Office within 24 hours of
learning or determining that an adulterated or misbranded product
received by or originating from the establishment has entered commerce.
This notification, in turn, will allow FSIS to initiate its preliminary
inquiries more quickly and to determine more quickly whether a recall
is necessary.
Improve Recall Effectiveness With Documented Procedures
FSIS expects that this final rule will assist meat and poultry
establishments during recalls. By requiring these establishments to
prepare and maintain recall procedures for all products they produce,
FSIS expects that establishments that do not currently have such plans
will be able to act more effectively to remove adulterated or
misbranded products from commerce. This added efficiency and
effectiveness will help establishments to move quickly to disseminate
information about the need to return the product to it and thus
maximize the amount of recalled product they will actually recover.
Table 4 gives a summary of the benefits discussed above.

Table 4--Summary of Benefits
------------------------------------------------------------------------
Benefit related to: Required actions: Expected benefits:
------------------------------------------------------------------------
Document Reassessment....... Improved
Establishments are HACCP systems for
to document all establishments.
reassessments of
HACCP plans.

Establishments are
to make
documentation of
the HACCP plans
available to
inspection program
personnel.
Notification Requirement.... FSIS will
Establishments are be alerted to
to notify local potential meat or
FSIS District poultry recall
Office within 24 situations earlier
hours of having than otherwise is
reason to believe the case today.
that an adulterated FSIS will
or misbranded be able to begin
product received or more rapidly
originating from preliminary
the official inquiries to
establishment has determine whether a
entered commerce. recall is
necessary.

[[Page 26935]]

Improve Recall Effectiveness
Establishments are Establishments will
to prepare and be able to act more
maintain recall effectively to
procedures for all remove adulterated
products they or misbranded
produce. products from
consumers.

Establishments will
be able to move
quickly to
disseminate
information about
the need to return
product to it.

Establishments will
be able to maximize
the amount of
product they will
be able to receive.
------------------------------------------------------------------------

D. Regulatory Flexibility Act Analysis

The FSIS Administrator has certified that this final rule will not
have a significant impact on a substantial number of small entities, as
defined by the Regulatory Flexibility Act (5 U.S.C. 601).
These small entities number about 5,900 federally-inspected
establishments. The average cost to small and very small businesses
will be in the range of $700 to $900 (Table 2).
Based on data recorded in the PBIS (2011) \6\ volume database, and
slaughter volume recorded in the FSIS Animal Disposition Reporting
System (ADRS, 2008) \7\ database, and volume estimates of the USDA
Economic Research Service (ERS, 2009) \8\, these 5,900 small entities
process about 12 percent or about 8 billion pounds of the U.S. meat and
poultry food supply per annum. Further, FSIS estimated that the average
processing volume per establishment of 5,900 small entities was about
1.4 million pounds (8,000,000,000/5,900) per annum. Thus, the average
cost for the first year of this final rule to small entities will be
less than one tenth of one cent (e.g., $0.0006 = $800/1,400,000) of
meat and poultry food products per pound. This is a relatively
insignificant cost to the small entities because most of their meat and
poultry food products are valued at more than $1.50 per pound. The
average cost for the following years, based on annual recurring costs,
decreases to less than one hundredth of one cent per pound.
---------------------------------------------------------------------------

\6\ USDA, FSIS Performance Based Inspection System Volume
Database 2011. The number of establishments is the number of
Federally-inspected processing and slaughter establishments.
\7\ USDA, FSIS Animal Disposition Reporting System Database
2008.
\8\ USDA, Economic Research Service, Food Availability (Per
Capita) Data System--Per capita food availability data compiled
reflect the amount of food available for human consumption in the
United States. March 2009, http://www.ers.usda.gov/Data/FoodConsumption.
---------------------------------------------------------------------------

E. Alternatives

The option of no rulemaking is unavailable. FSIS was directed to
conduct this rulemaking by Congress. As discussed above, FSIS
considered a longer time period (48 hours) for establishments to notify
FSIS when they have reason to believe that adulterated or misbranded
products of theirs may have entered commerce. This option was rejected
in response to comments received. Also in response to comments, FSIS is
providing a phased-in implementation period, with more time allowed for
small and very small establishments than for larger establishments,
rather than a uniform implementation period. This latter amendment
should lessen the burden on smaller entities.
Executive Order 12988
This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. When this final rule is adopted: (1) All State and
local laws and regulations that are inconsistent with this rule will be
preempted; (2) no retroactive effect will be given to this rule; and
(3) administrative proceedings will not be required before parties may
file suit in court challenging this rule.
Paperwork Requirements
In accordance with section 3507(j) of the Paperwork Reduction Act
of 1995 (44 U.S.C. 3501 et seq.), the information collection and
recordkeeping requirements included in this rule have been submitted
for approval to OMB.
Title: Requirements for Official Establishments to Notify FSIS of
Adulterated or Misbranded Product, Prepare and Maintain Written Recall
Procedures, and Document Certain HACCP Plan Reassessments.
Type of Collection: New.
Abstract: Under this final rule, FSIS is requiring three
information collection activities. First, FSIS requires that official
establishments notify the appropriate District Office that an
adulterated or misbranded product received by or originating from the
establishment has entered commerce, if the establishment believes or
has reason to believe that this has happened. FSIS is requiring that
this notification occur as quickly as possible, but within 24 hours of
the establishment learning or determining that an adulterated or
misbranded product received by or originating from it has entered
commerce. Second, FSIS is requiring that establishments prepare and
maintain written procedures for the recall of meat and poultry products
produced and shipped by the establishment for use should it become
necessary for the establishment to remove product from commerce. These
written recall procedures have to specify how the establishment will
decide whether to conduct a product recall and how the establishment
will effect the recall, should it decide that one is necessary.
Finally, FSIS is requiring that establishments document each
reassessment of the establishment's HACCP plans. FSIS requires
establishments to reassess their HACCP plans annually and whenever any
changes occur that could affect the hazard analysis or alter the HACCP
plan. Under this rule, establishments must document each reassessment,
the reasons for any changes to the HACCP plan, or the reasons for not
changing the HACCP plan. For annual reassessments, if the establishment
determines that no changes are necessary, documentation of this
determination is not necessary. The recall procedures and reassessment
documentation will have to be made available for official review and
copying.
Estimate of Burden of Average Hours per Response: 1.159.
Respondents: Official meat and poultry products establishments.
Estimated Number of Respondents: 6,300.
Estimated Number of Responses: 40,960.
Estimated Number of Responses per Respondent: 6.5.
Estimated Total Annual Burden on Respondents: 47,475.
Copies of this information collection assessment can be obtained
from John O'Connell, Paperwork Reduction Act Coordinator, Food Safety
and Inspection

[[Page 26936]]

Service, USDA, Room 6081, South Agriculture Building, 1400 Independence
Avenue SW., Washington, DC 20250.
E-Government Act Compliance
FSIS and USDA are committed to achieving the purposes of the E-
Government Act (44 U.S.C. 3601, et seq.) by, among other things,
promoting the use of the Internet and other information technologies
and providing increased opportunities for citizen access to government
information and services, and for other purposes.
Executive Order 13175
This final rule has been carefully evaluated for potential tribal
implications in accordance with Executive Order 13175, Consultation and
Coordination with Indian Tribal Governments. FSIS has concluded based
on its evaluation that this final rule will not have any direct or
substantial effects on Indian Tribes, on the relationship between the
Federal Government and Indian Tribes, or on the distribution of power
or responsibilities between the Federal Government and Indian Tribes
because there are currently no federally-inspected meat or poultry
establishments owned or operated by Indian Tribes in tribal areas or on
tribal reservations.
USDA Nondiscrimination Statement
The U.S. Department of Agriculture (USDA) prohibits discrimination
in all its programs and activities on the basis of race, color,
national origin, gender, religion, age, disability, political beliefs,
sexual orientation, and marital or family status. (Not all prohibited
bases apply to all programs.)
Persons with disabilities who require alternative means for
communication of program information (Braille, large print, audiotape,
etc.) should contact USDA's Target Center at 202-720-2600 (voice and
TTY).
To file a written complaint of discrimination, write USDA, Office
of the Assistant Secretary for Civil Rights, 1400 Independence Avenue
SW., Washington, DC 20250-9410 or call 202-720-5964 (voice and TTY).
USDA is an equal opportunity provider and employer.
Additional Public Notification
FSIS will announce this rule online through the FSIS Web page
located at http://www.fsis.usda.gov/regulations_&_policies/Interim_&_Final_Rules/index.asp.
FSIS will also make copies of this Federal Register publication
available through the FSIS Constituent Update, which is used to provide
information regarding FSIS policies, procedures, regulations, Federal
Register notices, FSIS public meetings, and other types of information
that could affect or would be of interest to constituents and
stakeholders. The Update is communicated via Listserv, a free
electronic mail subscription service for industry, trade groups,
consumer interest groups, health professionals, and other individuals
who have asked to be included. The Update is also available on the FSIS
Web page. In addition, FSIS offers an electronic mail subscription
service which provides automatic and customized access to selected food
safety news and information. This service is available at http://www.fsis.usda.gov/News_&_Events/Email_Subscription/. Options range
from recalls to export information to regulations, directives and
notices. Customers can add or delete subscriptions themselves, and have
the option to password protect their accounts.

List of Subjects in 9 CFR Parts 304, 381, 417 and 418

Hazard Analysis and Critical Control Point (HACCP) Systems, Meat
inspection, Poultry and poultry products inspection, Reporting and
recordkeeping requirements, Recalls.
For the reasons discussed in the preamble, FSIS is amending 9 CFR
Chapter III, as follows:

PART 304--APPLICATION FOR INSPECTION; GRANT OF INSPECTION

0
1. The authority citation for part 304 continues to read as follows:

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

0
2. In Sec. 304.3, paragraph (a) is revised to read as follows:

Sec. 304.3 Conditions for receiving inspection.

(a) Before being granted Federal inspection, an establishment must
have developed written sanitation Standard Operating Procedures, as
required by part 416 of this chapter, and written recall procedures as
required by part 418 of this chapter.
* * * * *

PART 381--POULTRY PRODUCTS INSPECTION REGULATIONS

0
3. The authority citation for part 381 continues to read as follows:

Authority: 7 U.S.C. 138f, 450; 21 U.S.C. 451-470; 7 CFR 2.7,
2.18, 2.53

0
4. In Sec. 381.22, paragraph (a) is revised to read as follows:

Sec. 381.22 Conditions for receiving inspection.

PART 417--HAZARD ANALYSIS AND CRITICAL CONTROL POINT (HACCP)
SYSTEMS

0
5. The authority citation for part 417 continues to read as follows:

Authority: 7 U.S.C. 450; 21 U.S.C. 451-470, 601-695; 7 U.S.C.
1901-1906; 7 CFR 2.18, 2.53.

0
6. In Sec. 417.4, paragraph (a)(3) is redesignated as paragraph
(a)(3)(i) and a new paragraph (a)(3)(ii) is added to read as follows:

Sec. 417.4 Validation, Verification, Reassessment.

* * * * *
(a) * * *
(3) Reassessment of the HACCP plan.
(i) * * *
(ii) Each establishment must make a record of each reassessment
required by paragraph (a)(3)(i) of this section and must document the
reasons for any changes to the HACCP plan based on the reassessment, or
the reasons for not changing the HACCP plan based on the reassessment.
For annual reassessments, if the establishment determines that no
changes are needed to its HACCP plan, it is not required to document
the basis for this determination.
* * * * *

0
7. A new part 418 is added to read as follows:

PART 418--RECALLS

Sec.
418.1 [Reserved]
418.2 Notification.
418.3 Preparation and maintenance of written recall procedures.
418.4 Records.

Authority: 7 U.S.C. 450; 21 U.S.C. 451-470, 601-695; 7 CFR 2.18,
2.53.

Sec. 418.1 [Reserved]

Sec. 418.2 Notification.

Each official establishment must promptly notify the local FSIS
District Office within 24 hours of learning or determining that an
adulterated or misbranded meat, meat food, poultry, or poultry product
received by or

[[Page 26937]]

originating from the official establishment has entered commerce, if
the official establishment believes or has reason to believe that this
has happened. The official establishment must inform the District
Office of the type, amount, origin, and destination of the adulterated
or misbranded product.

Sec. 418.3 Preparation and maintenance of written recall procedures.

Each official establishment must prepare and maintain written
procedures for the recall of any meat, meat food, poultry, or poultry
product produced and shipped by the official establishment. These
written procedures must specify how the official establishment will
decide whether to conduct a product recall, and how the establishment
will effect the recall, should it decide that one is necessary.

Sec. 418.4 Records.

All records, including records documenting procedures required by
this part, must be available for official review and copying.

Done in Washington, DC, on May 1, 2012.
Alfred V. Almanza,
Administrator.
[FR Doc. 2012-10917 Filed 5-7-12; 8:45 am]
BILLING CODE 3410-DM-P