[Federal Register Volume 83, Number 30 (Tuesday, February 13, 2018)]
[Proposed Rules]
[Pages 6314-6361]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-00425]



[[Page 6313]]

Vol. 83

Tuesday,

No. 30

February 13, 2018

Part II





Department of Agriculture





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Food Safety and Inspection Service





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9 CFR Parts 416, 417, et al.





Egg Products Inspection Regulations; Proposed Rule

Federal Register / Vol. 83 , No. 30 / Tuesday, February 13, 2018 / 
Proposed Rules

[[Page 6314]]


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DEPARTMENT OF AGRICULTURE

Food Safety and Inspection Service

9 CFR Parts 416, 417, 500, 590 and 591

[Docket No. FSIS-2005-0015]
RIN 0583-AC58


Egg Products Inspection Regulations

AGENCY: Food Safety and Inspection Service, USDA.

ACTION: Proposed rule.

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SUMMARY: The Food Safety and Inspection Service (FSIS) is proposing to 
amend the egg products inspection regulations by requiring official 
plants that process egg products (herein also referred to as ``egg 
products plants'' or ``plants'') to develop and implement Hazard 
Analysis and Critical Control Point (HACCP) Systems and Sanitation 
Standard Operating Procedures (Sanitation SOPs) and to meet other 
sanitation requirements consistent with the meat and poultry 
regulations. FSIS is proposing to eliminate those current regulatory 
provisions that are inconsistent with HACCP, Sanitation SOPs, and the 
proposed sanitation requirements. FSIS is also proposing to specify in 
the regulations that official plants are required to process egg 
products to be edible without additional preparation to achieve food 
safety.
    In addition, FSIS is proposing to: Provide for generic approval as 
part of the prior label approval system for egg products; make changes 
to labeling requirements for shell eggs consistent with those in the 
Food and Drug Administration's (FDA's) regulations; require special 
handling instructions on egg products; eliminate the requirements for 
prior approval by FSIS of egg products plant drawings, specifications, 
and equipment; incorporate egg products plants into the coverage of the 
``Rules of Practice'' that the Agency follows when initiating 
administrative enforcement actions; and change the Agency's 
interpretation of the requirement for continuous inspection in agency 
law.
    FSIS is also announcing that it is seeking public comment on draft 
guidance designed to help small and very small plants producing egg 
products to meet the new regulatory requirements being proposed in this 
rulemaking. Should the rule become final, FSIS intends to finalize this 
guidance.

DATES: Comments must be received on or before June 13, 2018. FSIS is 
providing a longer comment period than typical for this proposed rule 
because of the magnitude of the proposed action and the need to provide 
for possible public meetings on the proposed action.

ADDRESSES: FSIS invites interested persons to submit comments on this 
proposed rule and the draft guidance. Comments may be submitted by any 
of the following methods:
     Federal eRulemaking Portal: This website provides the 
ability to type short comments directly into the comment field on this 
web page or attach a file for lengthier comments. Go to http://www.regulations.gov. Follow the on-line instructions at that site for 
submitting comments.
     Mail, including CD-ROMs, etc.: Send to Docket Clerk, U.S. 
Department of Agriculture, Food Safety and Inspection Service, Patriots 
Plaza 3, 1400 Independence Avenue SW, Mailstop 3782, Room 8-163B, 
Washington, DC 20250-3700.
     Hand- or Courier-Delivered Submittals: Deliver to Patriots 
Plaza 3, 355 E Street SW, Room 8-163B, Washington, DC 20250-3700.
    Instructions: All items submitted by mail or electronic mail must 
include the Agency name and docket number FSIS-2005-0015. Comments 
received in response to this docket will be made available for public 
inspection and posted without change, including any personal 
information, to http://www.regulations.gov.
    Docket: For access to background documents or comments received, go 
to the FSIS Docket Room at Patriots Plaza 3, 355 E Street SW, Room 8-
164, Washington, DC 20250-3700 between 8:00 a.m. and 4:30 p.m., Monday 
through Friday.

FOR FURTHER INFORMATION CONTACT: Victoria A. Levine, Program Analyst, 
Issuances Staff, Office of Policy and Program Development, Food Safety 
and Inspection Service, U.S. Department of Agriculture, 1400 
Independence Avenue SW, Room 6079, South Agriculture Building, 
Washington, DC 20250-3700; telephone (202) 720-5627; fax (202) 690-
0486.

SUPPLEMENTARY INFORMATION: 

Executive Summary

    FSIS is proposing to amend the egg products inspection regulations 
(9 CFR part 590) to require that official plants \1\ that process egg 
products develop and implement Hazard Analysis and Critical Control 
Points (HACCP) systems and Sanitation Standard Operating Procedures 
(Sanitation SOPs), in accordance with the regulations in 9 CFR parts 
416 and 417, and to meet proposed sanitation requirements (proposed 9 
CFR part 591). The Agency is proposing to eliminate those regulations 
that are incompatible with the regulations for HACCP and Sanitation 
SOPs and to convert prescriptive, command-and-control requirements to 
general sanitation standards.
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    \1\ As defined in the Egg Products Inspection Act (21 U.S.C. 
1031 et seq.). Exempted plants, as defined in 9 CFR 590.5, are also 
official plants, per the statute.
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    Existing regulations that FSIS is proposing to revise or eliminate 
include those relating to egg products plant grounds and pest 
management; plant sanitation; plant construction, including rooms, 
doors, and windows; lighting; ventilation and odors; plumbing; sewage 
disposal; water supply and solution re-use; and dressing rooms, 
lavatories, and toilets. The Agency is proposing to replace all of 
these with general sanitation requirements, as it has previously done 
with the requirements on the same subjects in the meat and poultry 
products regulations.
    The Agency is also proposing to specify in the regulations that 
official plants are required to process egg products to be edible 
without additional preparation to achieve food safety (proposed 9 CFR 
590.570). This will ensure that the products are free of detectable 
pathogens. The proposed regulations will require egg product plants to 
maintain control of egg products that have been sampled and tested for 
public health hazards, e.g., Salmonella, until the test results become 
available (proposed amendments to 9 CFR 590.504). The proposed amended 
regulations will provide for the use of irradiated shell eggs in the 
processing of egg products and food products containing them (proposed 
9 CFR 590.590).
    The Agency is proposing to make the egg products labeling and 
``other consumer protection'' requirements, including requirements for 
generically approved labeling, more like the labeling requirements for 
meat and poultry products (proposed 9 CFR 590.412).
    FSIS is proposing to align the import requirements for eggs and egg 
products more closely with the import requirements for meat and poultry 
products (proposed 9 CFR 590, Subpart B).
    FSIS is proposing to change organizational terms and job titles 
that appear in the regulations but that are no longer used in FSIS 
(proposed amendment of 9 CFR 590.5).
    FSIS is also proposing to change the Agency's interpretation of the 
requirement for continuous inspection in 21 U.S.C. 1034(a). Inspection 
will no

[[Page 6315]]

longer be conducted during all processing operations, but may instead 
be provided at least once per shift.
    Finally, FSIS is proposing to replace the rules of practice 
governing enforcement procedures for egg product plants with those that 
apply to meat and poultry product establishments (proposed amendments 
to 9 CFR part 500).
    Costs attributable to the proposed rule are those associated with 
the development and implementation of HACCP plans and Sanitation SOPs 
and the need for new product labels with safe-handling instructions. 
The impact of the costs is somewhat mitigated by the fact that 93 
percent of egg products plants already use a written HACCP plan to 
address at least one production step in their process.
    FSIS will continue to test for Salmonella and Listeria 
monocytogenes (Lm) in egg products. If FSIS detects the pathogens in 
the product, under HACCP, plants will be required to take corrective 
actions to prevent recurrence of the problem, if the plant has 
determined the pathogen is reasonably likely to occur in its production 
process (9 CFR 417.3(a)). If FSIS detects the pathogen and the plant 
has not determined that the hazard is reasonably likely to occur, the 
plant will be required to take corrective actions and also will be 
required to reassess its HACCP plan (9 CFR 417.3(b)). FSIS also will 
continue to require that egg product plants test pasteurized egg 
products for pathogens. Plants must ensure that egg products that test 
positive for pathogens are condemned or reprocessed (9 CFR 590.422).
    The proposed rule will provide greater flexibility and incentives 
for innovation through reductions in paperwork and unnecessary 
approvals. In addition, plants voluntarily meeting HACCP requirements 
and also complying with current prescriptive regulations would reduce 
costs because they would be operating entirely under HACCP 
requirements.

                                Table 1--Summary of Estimated Costs and Benefits
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                                        Discussion of benefits and costs
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                                                 Low                      Mid                      High
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Benefits ($1,000) \a\................                    5,585                    5,585                    5,585
Costs ($1,000).......................                  2,195.0                  4,235.2                  6,287.8
Net Benefits ($1,000)................                  3,389.7                  1,349.5                   -703.1
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Industry Benefits....................   Long-term efficiency gains, as shown in academic literature
                                       derived from producing egg products in a HACCP system.
                                        Less burdensome or elimination of waiver, blueprints, no
                                       objection letter, changes to production equipment, and label approval
                                       submissions to FSIS.
                                        Cost savings from the elimination of overtime and holiday pay
                                       paid to FSIS inspectors for inspection.
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Agency Benefits......................   Long-term benefits from improved inspection personnel coverage.
                                       Egg products inspection personnel will now be trained under a HACCP
                                       system and can be positioned for inspection in traditional meat and
                                       poultry establishments.
                                        Salary savings for the reduction in inspection at egg products
                                       plants.
                                        Savings from the reduction or elimination of waiver, blueprints,
                                       no objection letter, changes to production equipment, and label approval
                                       submissions to FSIS from industry.
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Industry Costs.......................   Cost to the plant to create HACCP plans and Sanitation SOPs.
                                        Costs to the plant for additional recordkeeping and monitoring.
                                        Cost to the plant for training personnel in the HACCP system.
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Agency Costs.........................   Costs for training inspection program personnel in HACCP and egg
                                       products inspection.
                                        Costs to the Agency to provide relief inspectors while egg
                                       products plants inspectors are being trained.
                                        Additional travel costs for inspection personnel on patrol
                                       assignments in egg products plants.
                                        Loss of overhead paid to the Agency by industry.
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\a\ Costs were annualized over 10 years at the 7 percent discount rate.

    A copy of each document referenced in this notice of proposed 
rulemaking is available for viewing in the FSIS Docket Room, on the 
FSIS website as a related document associated with this docket, and on 
www.regulations.gov, unless otherwise noted.

Table of Contents

I. Background
    FSIS's Regulatory Jurisdiction Over Egg Products
    1. What Products Are Covered Under the EPIA
    2. Product Amenability Determinations Under the EPIA
II. Proposed Changes to Specific Regulations
    A. Part 591
    B. HACCP
    C. Sanitation SOPs
    D. Sanitation Requirements
    E. Egg Products Are ``Ready-To-Eat''
    F. Not Applying the Mark of Inspection Pending Test Results
    G. Irradiated Shell Eggs
    H. Preparing for Implementation of Regulatory Requirements
    I. Labeling and Other Consumer Protection Regulatory 
Requirements
    J. Rules of Practice
    K. Other Regulatory Changes
    1. Elimination of Egg Products Plant Equipment and Facility 
Prior Approval Requirements
    2. Import Requirements
    3. Changes to Defined Terms
    4. Conditions for Receiving Inspection
    5. Miscellaneous Changes
    6. Reinterpreting the Requirement for Continuous Inspection in 
21 U.S.C. 1034(a)
III. Executive Orders 12866 and 13563 and the Regulatory Flexibility 
Act
IV. Paperwork Reduction Act
V. Executive Order 12988
VI. E-Government Compliance

[[Page 6316]]

VII. Executive Order 13175
VIII. USDA Nondiscrimination Statement
IX. Additional Public Notification

I. Background

FSIS's Regulatory Jurisdiction Over Egg Products

    FSIS carries out its food safety responsibilities with respect to 
eggs and egg products under the provisions of the Egg Products 
Inspection Act (EPIA) (21 U.S.C. 1031-1056).
    To prevent the entry into commerce of any egg product that is 
capable of use as human food and is misbranded or adulterated, the 
Secretary of Agriculture regulates the processing of egg products under 
21 U.S.C. 1034. Section 1034(a) states that the Secretary ``shall, 
whenever processing operations are being conducted, cause continuous 
inspection to be made, in accordance with the regulations promulgated 
under this Act, of the processing of egg products, in each plant 
processing for commerce, . . . .'' Therefore, under FSIS's current 
interpretation of the EPIA, an inspector needs to be on the premises 
during all such operations. The Secretary has also been authorized to 
make inspections, as appropriate, of the facilities of egg handlers 
(including transport vehicles) to determine whether shell eggs destined 
for the ultimate consumer are being held under refrigeration at an 
ambient temperature of no greater than 45 degrees Fahrenheit after 
packing and contain labeling that indicates that refrigeration is 
required (21 U.S.C. 1034(e)).
    Under 21 U.S.C. 1043, the Secretary of Agriculture has the 
authority to promulgate such rules and regulations as he deems 
necessary to carry out the purposes or provisions of the Act. The 
Secretary is also responsible for the administration and enforcement of 
the EPIA, except as otherwise provided in 21 U.S.C. 1034(d).
1. What Products Are Covered Under the EPIA
    Under the EPIA, FSIS regulates egg products. FSIS also has been 
delegated the authority to establish temperature and labeling 
requirements applicable to shell eggs destined for the ultimate 
consumer (see 21 U.S.C. 1034(e)(1)).
    Under 21 U.S.C. 1033(f), the term ``egg product'' means any 
``dried, frozen, or liquid eggs, with or without added ingredients, 
excepting products which contain eggs only in a relatively small 
proportion or historically have not been, in the judgment of the 
Secretary, considered by consumers as products of the egg food 
industry, and which may be exempted by the Secretary under such 
conditions as he may prescribe to assure that the egg ingredients are 
not adulterated and such products are not represented as egg 
products.'' The EPIA does not define ``relatively small proportion,'' 
nor does it provide additional guidance as to what criteria the 
Secretary should take into consideration when determining what egg 
products consumers consider to be products of the egg food industry.
    Under 21 U.S.C. 1034(a), the Secretary requires continuous 
inspection to be made of the processing of egg products in each plant 
processing for commerce. There are currently 77 such official plants 
that are under FSIS jurisdiction. Under the EPIA, ``processing'' means 
``manufacturing egg products, including breaking eggs or filtering, 
mixing, blending, pasteurizing, stabilizing, cooling, freezing, drying, 
or packaging egg products'' (21 U.S.C. 1033(w)). Thus, egg products 
processing operations, such as mixing, pasteurizing, freezing, 
packaging, or relabeling, must be conducted under continuous Agency 
inspection.
    The definition of ``egg product'' in the egg products inspection 
regulations (9 CFR 590.5) includes a list of specific products that 
have been exempted as not being ``egg products.'' These exempted 
products include freeze-dried products; imitation egg products; egg 
substitutes; dietary foods; dried no-bake custard mixes; egg nog mixes; 
acidic dressings; noodles; milk and egg dip; cake mixes; French toast; 
and sandwiches containing eggs or egg products. Such products must, 
however, be prepared from inspected egg products or from eggs 
containing no more restricted eggs than are allowed in the official 
standards for U.S. Consumer Grade B shell eggs.\2\ Exempted products 
are subject to the jurisdiction of the Food and Drug Administration 
(FDA).
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    \2\ See the United States Standards, Grades, and Weight Classes 
for Shell Eggs, AMS 56.216(c). http://www.ams.usda.gov/sites/default/files/media/Shell_Egg_Standard%5B1%5D.pdf.
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    As stated above, products that contain eggs only in a relatively 
small proportion are exempted from the definition of ``egg product'' 
and thus not amenable under the EPIA. Several of the products listed in 
the preceding paragraph have been exempted from the coverage of ``egg 
products'' for this reason, including dried no-bake custard mixes; egg 
nog mixes; acidic dressings; noodles; milk and egg dip; cake mixes; and 
French toast. The egg product ingredients in these foods are not easily 
distinguished in the food and are used simply to add flavor. Other 
products that include eggs but are not subject to FSIS jurisdiction are 
closed-face sandwiches containing eggs or egg products and balut, a 
Philippine delicacy. These products are subject to the jurisdiction of 
FDA.
    Cooked egg products, such as cooked egg patties, cooked omelets, 
and freeze-dried cooked eggs, also fall under FDA's jurisdiction 
because they are produced from USDA-inspected and passed egg products. 
To eliminate confusion as to who has statutory authority over these 
types of products, FSIS is proposing to amend the definition of ``egg 
product'' in 9 CFR 590.5 to include cooked egg products as not being 
egg products under FSIS jurisdiction.
2. Product Amenability Determinations Under the EPIA
    FSIS considers a product to be amenable under the EPIA if it 
consists of dried, frozen, or liquid eggs, with or without added 
ingredients. Examples include Pasteurized Frozen Whole Egg with citric 
acid; plain Pasteurized Frozen Whole Egg without added ingredients; 
Pasteurized Liquid Yolk with 10% salt; Pasteurized Frozen Scrambled Egg 
Mix with Whole Egg and pepper, starch, and dried milk; Frozen Yolks 
with 10% sugar added; Frozen Egg Whites with whipping aids (such as 
sodium sulfate or triethyl citrate); Pasteurized Enzyme Modified Dried 
Egg Product with Egg Yolks and xanthan gum and citric acid to preserve 
color, and less than 1% silicon dioxide as an anticaking agent and 
phospholipase; Spray Dried Albumin; and Spray Dried Egg Whites with 
calcium citrate and salt (or other added ingredients).
    FSIS has determined that some of the products on the list of 
specific products that have been exempted as not being ``egg products'' 
are incorrectly categorized as such. FSIS believes that these products, 
egg substitutes and freeze-dried egg products, are, in fact, egg 
products, and should therefore no longer be exempt from inspection by 
FSIS under the EPIA. FSIS is seeking comment on the number of 
facilities that might become dual jurisdiction facilities, that is, 
regulated by FSIS and FDA, if egg substitutes and freeze-dried egg 
products are no longer exempt from FSIS inspection.
Egg Substitutes
    Egg substitutes are low-cholesterol products that are characterized 
by yolk replacement by other non-egg ingredients such as vegetable oil, 
nonfat dry milk, soy protein, gums, food coloring, artificial flavors, 
and vitamins and minerals (for nutritional fortification). The 
fundamental ingredient in these products is egg white, but they may 
also include added

[[Page 6317]]

egg-white solids or a small amount of yolk. When the EPIA and the egg 
products inspection regulations were written, the production of egg 
substitutes was exempted from United States Department of Agriculture 
(USDA) inspection in the egg products inspection regulations.
    As a result, egg substitutes are under the jurisdiction of FDA. FDA 
has overseen the formulation, packaging, labeling, storage, and 
transportation of egg substitutes under the Federal Food, Drug, and 
Cosmetic Act (FFDCA) (21 U.S.C. 301-399). Egg substitutes do not 
undergo continuous inspection during processing (unless the starting 
ingredient is unpasteurized egg white), and most egg substitutes do not 
bear a USDA inspection legend.
    However, FSIS tentatively finds that egg substitutes should no 
longer be exempt from inspection by FSIS under the EPIA. Egg 
substitutes are similar, if not identical, in some cases, in 
formulation to egg products. Indeed, the egg product ingredient is 
distinctive and significantly contributes to the basic nature of egg 
substitutes by characterizing the food. The only substantive difference 
among these categories of products is color and nutrients. When a color 
additive is mixed with pasteurized egg whites, the resulting product is 
called an ``egg substitute.'' The application of color to pasteurized 
egg whites has generally not been conducted under FSIS inspection.
    The processing of egg substitutes is also similar to that of other 
egg products, and the contamination risks associated with these types 
of products are the same. Egg products and egg substitutes are 
manufactured using the same process, though egg substitutes processed 
in an FDA facility do not have to re-pasteurized; where CCPs exist in 
the manufacture of egg products, they exist in the production of egg 
substitutes, e.g., during mixing, blending, pasteurization, if 
applicable, cooling, and packaging. The fact that egg substitutes are 
formulated with pasteurized egg whites does not mean that all food 
safety risks associated with the products are eliminated. Some egg 
substitutes are not re-pasteurized after production, even though they 
have been further processed in the FDA facility. To produce egg 
substitutes, manufacturers need to reprocess pasteurized egg whites 
because of the risk of product contamination post-pasteurization.
    Because the risks associated with egg substitutes are the same as 
those associated with egg products, and because the reprocessing step 
presents a point in the process where contamination of egg substitutes 
might occur, under the EPIA, the processing of egg substitutes needs to 
take place within the framework of HACCP and Sanitation SOP preventive 
control measures. Furthermore, the addition of color and other 
ingredients does not materially change the products such that the 
jurisdiction over the inspection of the products should be different 
than for other egg products. In an effort to be more transparent about 
the roles and responsibilities of FSIS and FDA regarding eggs, and 
after consulting with FDA, FSIS is proposing to assert jurisdiction 
over egg substitutes.
    In addition, FSIS is proposing to assert jurisdiction over freeze-
dried egg products. Under 9 CFR 590.5, these are exempted from being 
egg products. However, FSIS tentatively finds this categorization to be 
incorrect. Freeze-dried egg products are amenable under the EPIA 
because they consist of a pasteurized egg product that is flash frozen 
and placed in a vacuum chamber where ice particles are removed. The 
food safety risks associated with freezing the product and contemplated 
by the EPIA are the same whether the process takes place in an FSIS-
inspected egg products plant or an FDA-inspected facility. As a result, 
if this proposal is adopted, freeze-dried egg products will no longer 
be exempt and will be subject to FSIS's jurisdiction. Therefore, FSIS 
is proposing to amend the list of products exempted as not being egg 
products in 9 CFR 590.5 to eliminate freeze-dried products and egg 
substitutes.

II. Proposed Changes to Specific Regulations

A. 9 CFR Part 591

    Under proposed 9 CFR 591.1(a), all official plants will have to 
comply with the requirements contained in 9 CFR parts 416, Sanitation, 
and 417, HACCP Systems. For the purposes of these parts, as well as 9 
CFR part 500, Rules of Practice, an ``official establishment'' or 
``establishment'' will include a plant that processes egg products 
(proposed 9 CFR 591.1(b)).

B. HACCP

    FSIS is proposing to adopt HACCP as the organizing structure for 
its egg products food safety program because HACCP has been proven to 
be an optimal framework for building science-based process control into 
food production systems to prevent food safety hazards. Under proposed 
9 CFR 590.149(b) and 591.1(a), official plants will be required to 
comply with 9 CFR part 417, the Agency's regulation on HACCP, as a 
condition of receiving inspection.
    HACCP is a flexible system that will enable official plants to 
tailor their control systems to the needs of their particular plants 
and processes. Under proposed 9 CFR 590.149(b)and 591.1 and 9 CFR part 
417, each egg products plant will be required to develop and implement 
a HACCP system for food safety that is designed to prevent, eliminate, 
or reduce to an acceptable level the occurrence of biological, 
chemical, and physical hazards that are reasonably likely to occur in 
the plant's process. Plants will be responsible for developing and 
implementing HACCP plans that incorporate the controls that are 
necessary to produce safe egg products. Given the requirements in 9 CFR 
part 417, FSIS is proposing to amend or eliminate many of the 
processing and facility requirements contained in 9 CFR 590.500-575.
    Under 9 CFR part 417, when developing a HACCP plan (9 CFR 
417.2(b)), a plant conducts a hazard analysis to identify and list the 
biological, chemical, or physical food safety hazards that are 
reasonably likely to occur in its production process for a particular 
product and the measures necessary to prevent, eliminate, or reduce the 
occurrence of those hazards to an acceptable level. The plant then 
identifies the points in each of its processes at which control is 
necessary to achieve this goal (9 CFR 417.2(c)(2)). These points are 
called ``critical control points'' (CCPs). The plant would have to 
establish critical limits for the preventive measures associated with 
each identified CCP. A critical limit is the maximum or minimum value 
to which a hazard must be controlled at a CCP to prevent, eliminate, or 
reduce to an acceptable level the occurrence of the identified food 
safety hazard. Critical limits are most often based on process 
parameters such as temperature, time, water activity, pH, or humidity.
    FSIS is proposing to treat egg products similarly to the way it 
treats ready-to-eat (RTE) meat and poultry products. FSIS will require 
that official plants produce egg products to be edible without 
additional preparation to achieve food safety. Pathogens detected in or 
on RTE egg products would adulterate those egg products under 21 U.S.C. 
1033(a)(1)) because they would contain a poisonous or deleterious 
substance which may render them injurious to health.
    For example, FSIS regards any amount of Lm in an RTE product as a 
product adulterant (9 CFR 430.4). Because the product is RTE, it is 
likely to be consumed without any effort to kill the pathogen, and the 
presence of the pathogen may render the product

[[Page 6318]]

injurious to health (21 U.S.C. 601(m)(1), 453(g)(1)) and would cause 
the product to be unhealthful.\3\ The same would be true of an RTE egg 
product containing Salmonella or Lm. While egg products may receive 
additional preparation for palatability or aesthetic, epicurean, 
gastronomic, or culinary purposes, they are produced to be edible 
without additional preparation to achieve food safety. The presence of 
Salmonella or Lm, therefore, would render the product injurious to 
health (21 U.S.C. 1033(a)(1)) and would cause it to be unhealthful.
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    \3\ Control of Listeria monocytogenes in Ready-to-Eat Meat and 
Poultry Products; Final Rule (68 FR 34208, Jun. 6, 2003).
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    FSIS has also addressed shiga-toxin producing E. coli (STEC) in 
certain raw beef products (non-intact or intended for non-intact use) 
in this manner. FSIS considers an acceptable reduction for STEC to be a 
reduction to an undetectable level (i.e., a level that would not be 
detectable using the FSIS testing method or a method with a sensitivity 
at least equivalent to FSIS's method).\4\ This means that an 
establishment producing RTE meat or poultry products or certain raw 
beef products needs to address the pathogens so that they will not be 
detected by FSIS or other equivalent testing. FSIS has recommended that 
establishments do their own testing to verify that their HACCP systems 
address the pathogens of concerns.\5\ While establishments can use 
their own testing methods, those methods should be at least as 
sensitive as FSIS's.\6\ FSIS has also said that establishments can 
address the pathogen in their HACCP plan or Sanitation SOPs or other 
prerequisite program.\7\ This same guidance would apply to egg products 
plants.
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    \4\ E. coli O157:H7 Contamination of Beef Products (67 FR 62325, 
October 7, 2002) (available at: http://www.fsis.usda.gov/wps/wcm/connect/ad259bcd-5b85-4696-9888-89872bee39ee/00-022N.pdf?MOD=AJPERES).
    \5\ Control of Listeria monocytogenes in Ready-to-Eat Meat and 
Poultry Products; Final Rule (68 FR 34214, Jun. 6, 2003).
    \6\ FSIS. 2013. Establishment Guidance for the Selection of a 
Commercial or Private Microbiological Testing Laboratory (available 
at: http://www.fsis.usda.gov/wps/wcm/connect/464a4827-0c9a-4268-8651-b417bb6bba51/Guidance-Selection-Commercial-Private-Microbiological-Testing-lab-062013.pdf?MOD=AJPERES).
    \7\ HACCP Systems Validation (80 FR 27557, May 14, 2015).
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    Under the Agency's verification testing program, egg products are 
broken into seven product categories--four liquid and three dried. Each 
month, inspectors collect one egg product sample per process from each 
plant that produces egg products. Thus, inspectors could sample an egg 
products plant as many as seven times per month depending on the number 
of plant production processes occurring during the month. After 
inspectors collect the samples, FSIS Field Service Laboratories analyze 
the samples for the presence of Salmonella and Lm using the protocols 
listed in the Microbiology Laboratory Handbook.8 9
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    \8\ Isolation and Identification of Salmonella from Meat, 
Poultry, Pasteurized Egg, and Siluriformes (Fish) Products and 
Carcass and Environmental Sponges. January 2, 2017 (available at: 
https://www.fsis.usda.gov/wps/wcm/connect/700c05fe-06a2-492a-a6e1-3357f7701f52/MLG-4.pdf?MOD=AJPERES).
    \9\ Isolation and Identification of Listeria Monocytogenes from 
Red Meat, Poultry, Ready-To-Eat Siluriformes Fish and Egg Products, 
and Environmental Samples January 2, 2017 (available at: https://www.fsis.usda.gov/wps/wcm/connect/1710bee8-76b9-4e6c-92fc-fdc290dbfa92/MLG-8.pdf?MOD=AJPERES).
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    Once a plant has established critical limits for the measures 
associated with each identified CCP, it will need to monitor the 
identified CCPs to assess whether the CCP is within the established 
critical limit (9 CFR 417.2(c)(4)). Monitoring is an integral part of 
HACCP, and monitoring frequencies must be sufficient to ensure that 
each CCP is under control. The plant's HACCP plan would also have to 
include corrective action to be taken when monitoring indicates that 
there is a deviation from a critical limit at a CCP, because the 
existence of a HACCP plan does not guarantee that problems will not 
arise (9 CFR 417.2(c)(5)). For example, corrective action plans must be 
in place to identify and correct the cause of a deviation and to 
determine the disposition of potentially adulterated product.
    Plants will also have to develop and maintain effective 
recordkeeping procedures that document the entire HACCP system (9 CFR 
417.2(c)(6)). Finally, plants will need to list the verification 
procedures, and the frequency with which those procedures will be 
performed, that the plant will use to ensure that the HACCP system is 
in compliance with the HACCP plan (9 CFR 417.2(c)(7)). Periodic 
verification will help the plant to ensure that it is operating in 
accordance with its HACCP plan. The occurrence of unforeseen hazards 
evidences that the HACCP plan needs to be reassessed. If this proposal 
is adopted, individuals developing, reassessing, and modifying HACCP 
plans in accordance with 9 CFR 417.2(b) and 417.3 will have to have 
successfully completed a course of instruction in the application of 
the seven HACCP principles to meat, poultry, or egg products 
processing, including a segment on the development of a HACCP plan for 
a specific product and on record review (9 CFR 417.7(b)).
    Under this proposal, if an egg products plant fails to develop and 
implement a HACCP plan that complies with proposed 9 CFR 590.149(b) and 
591.1 and 9 CFR 417.2, or to operate in accordance with other 9 CFR 
part 417 requirements, FSIS is likely to file a complaint to withdraw 
or refuse inspection services, pursuant to 9 CFR 500.6 or 500.7. As 
with official meat and poultry products establishments, FSIS will 
verify that the plant's HACCP plans comply with the requirements of 
proposed 9 CFR 590.149(b) and 591.1 and 9 CFR part 417; that these 
plans have been validated by the facility; and that plants are 
producing egg products to be edible without additional preparation to 
achieve food safety. In other words, these products must be free of 
detectable pathogens.
Hazard Analysis
    If this proposal is adopted, each egg products plant will be 
required to conduct a hazard analysis to determine the food safety 
hazards reasonably likely to occur in its production processes and to 
identify the preventive measures that it needs to take to control those 
hazards (proposed 9 CFR 590.149(b) and 591.2 and 9 CFR 417.2(a)(1)). 
The analysis must include a flow chart that describes the steps of the 
process and that identifies the intended use or consumers of the 
finished product (9 CFR 417.2(a)(2)).
    Contamination with Salmonella spp. can be a food safety hazard that 
is reasonably likely to occur in the production of egg products. 
Therefore, as part of its hazard analysis, each egg products plant 
should consider addressing this food safety hazard in its HACCP system. 
Consistent with the application of HACCP in meat and poultry 
operations, plants may determine that the Sanitation SOP or a 
prerequisite program is an appropriate and suitable means to 
effectively prevent the occurrence of certain food safety hazards and 
thus make them not reasonably likely to occur.
HACCP Plan
    Under this proposed rule, each egg products plant will be required 
to develop and implement a HACCP plan covering each product produced 
whenever the hazard analysis reveals one or more food safety hazards 
that are reasonably likely to occur. Note that a single HACCP plan may 
encompass multiple products within a single processing category (see 
proposed 9 CFR 590.149(b) and 591.2 and 9 CFR 417.2(b)(1)) if the food 
safety hazards,

[[Page 6319]]

CCPs, critical limits, and procedures identified within are essentially 
the same.
    Once completed, the HACCP plan must be signed and dated by a 
responsible official, that is, the individual with overall authority 
on-site or a higher level official of the plant. This signature 
signifies that the plant accepts and will implement the HACCP plan. The 
HACCP plan must be signed and dated not only upon initial acceptance by 
the processor but also upon any modification to the plan and at least 
annually, as required by 9 CFR 417.4(a)(3) (9 CFR 417.2(d)).
Corrective Actions
    Under this proposed rule, the HACCP plan must identify the 
corrective actions that the plant will take when responding to a 
deviation from a critical limit and assign responsibility for taking 
corrective action. Corrective actions must ensure that no product that 
is injurious to health or that is otherwise adulterated as a result of 
the deviation enters commerce; that the cause of the deviation is 
identified and eliminated; that the CCP will be under control after the 
corrective action is taken; and that measures to prevent recurrence are 
established (proposed 9 CFR 590.149(b) and 591.2 and 9 CFR 417.3).
    Because pre-established corrective actions may not cover every 
contingency, and unforeseen hazards or deviations may occur, 9 CFR 
417.3(b) provides a series of steps that must be taken in such 
situations. These steps include segregating and holding affected 
product and conducting a review to determine the acceptability of the 
product for distribution, ensuring that any adulterated product or 
product otherwise injurious to health does not enter commerce, and 
reassessing HACCP plans to determine whether any modification is 
needed.
Validation, Verification, and Reassessment
    Under this proposed rule, every egg products plant will be required 
to validate its HACCP plan's adequacy in controlling the food safety 
hazards identified during the hazard analysis. Once the plant has 
determined that the HACCP plan is functioning as intended, it will have 
to validate that the plan is being effectively implemented (proposed 9 
CFR 590.149(b) and 591.1 and 9 CFR 417.4(a)).\10\ FSIS will provide 
additional guidance to plants on how to validate their HACCP systems.
---------------------------------------------------------------------------

    \10\ On May 14, 2015, FSIS announced the availability of the 
final revision of its Compliance Guideline for Hazard Analysis 
Critical Control Point (HACCP) systems validation (80 FR 27557).
---------------------------------------------------------------------------

    Upon completion of the hazard analysis and the development of the 
HACCP plan, the plant will conduct its initial validation, which 
consists of the activities the plant must perform to determine whether 
the plan is functioning as intended. During this initial validation, 
the facility repeatedly tests the adequacy of the CCPs, critical 
limits, monitoring and recordkeeping procedures, and corrective actions 
set forth in the HACCP plan. Validation also encompasses reviews of the 
records, routinely generated by the HACCP system, in the context of 
other validation activities. Plants may use independent consultants, 
process authorities, or employees trained in accordance with 9 CFR 
417.7 for plan development and validation.
    The data used to validate a HACCP plan may be derived from various 
sources, including the scientific literature, product testing results, 
experimental research results, scientifically-based regulatory 
requirements, FSIS compliance guidelines, computer-modeling programs, 
and data developed by process authorities (a process authority is a 
person or organization with expert knowledge in the relevant products, 
process controls, and regulations). However, validation data must 
include at least 90 days of in-plant data or information reflecting the 
plant's experience in implementing the HACCP plan during plant 
operations. These data are needed because validation must demonstrate 
not only that the HACCP plan is scientifically sound, but also that 
this particular egg products plant can implement the HACCP plan and 
make it work.
    To ensure that the HACCP plan is functioning as intended on a 
continual basis, the plant would conduct ongoing verification 
activities (proposed 9 CFR 590.149 and 591.1 and 9 CFR 417.4(a)(2)). 
Verification is intended to show that the HACCP system is working 
effectively on a day-to-day basis, resulting in the production of safe 
food. Verification is distinct from ongoing plant monitoring, which is 
designed to provide a record showing that the written HACCP plan is 
being followed.
    Verification includes repeatedly reviewing and evaluating the 
various components of the HACCP system. Verification activities should 
provide practical results specific to the operation of the given HACCP 
plan and could include, but would not be limited to, checking the 
adequacy of critical limits; reviewing CCP-monitoring records; 
reviewing monitoring and recordkeeping procedures; calibrating process-
monitoring instruments; collecting in-line or finished product samples 
for biological (e.g. Salmonella spp.), chemical, or physical analysis; 
and directly observing and evaluating the adequacy of corrective 
actions.
    Under this proposed rule, plants will also be required to reassess 
the adequacy of their HACCP plans at least annually and whenever any 
changes occur that could affect the hazard analysis or alter the HACCP 
plan. Examples of such changes include changes in raw materials or the 
source of raw materials; product formulation; production volume; 
packaging; or the intended use or consumers of the finished product 
(proposed 9 CFR 590.149, 591.1, and 591.2, and 9 CFR 417.4(a)(3)). This 
reassessment must be conducted by an individual who has successfully 
completed a course of instruction in the application of the seven HACCP 
principles, including a segment on the development of a HACCP plan for 
a specific product, for example, liquid egg product, and on record 
review (9 CFR 417.7(b)).
    By periodically monitoring its HACCP plan, a plant can ensure that 
the plan is continuously effective in controlling and preventing food 
safety hazards. It also provides a plant the opportunity to apply 
relevant experiences to improving process controls.
Records
    Under this proposed rule, plants will have to maintain records 
regarding their operations under HACCP. These records include the 
written hazard analysis and all supporting documentation, the written 
HACCP plan and all decision-making documents associated with the 
development of CCPs and critical limits, and documents supporting the 
monitoring and verification procedures selected and the frequency of 
those procedures. Records documenting the monitoring of CCPs and 
critical limits, corrective actions, verification procedures and 
results, product codes, and product name or identity will also have to 
be maintained. Each entry on a record maintained under the HACCP plan 
will have to be made at the time the specific event occurred and 
include the date and time recorded, and be signed or initialed by the 
employee making the entry.
    Prior to shipping product, the plant will have to review the 
processing and production records associated with the HACCP plan to 
ensure that they are complete, all critical limits were met, and, if 
applicable, that corrective actions were taken (proposed 9 CFR 590.149 
and 591.1 and 9 CFR 417.5(c)).

[[Page 6320]]

This pre-shipment review will have to be conducted by someone other 
than the person who produced the records, where practicable, and 
preferably by an individual trained in accordance with 9 CFR 417.7 or 
the responsible plant official.

C. Sanitation Standard Operating Procedures (Sanitation SOPs)

General
    Proper sanitation is an important and integral part of every food 
process and a fundamental requirement under the law. Insanitary 
facilities and equipment, and poor food handling and personal hygiene 
practices among employees, create an environment in which pathogens can 
flourish. Furthermore, the law is quite clear: Eggs or egg products 
that have been prepared, packed, or held under insanitary conditions 
whereby they may have been contaminated with filth, or whereby they may 
have been rendered injurious to health are deemed adulterated (21 
U.S.C. 1033(a)(4)). FSIS inspection program personnel are expressly 
charged with ensuring that product is produced and held under sanitary 
conditions.\11\ For these reasons, FSIS is proposing to require that 
all plants that process egg products develop, implement, and maintain 
written Sanitation SOPs to prevent direct contamination or adulteration 
of product before and during operations (9 CFR 416.11). Under this 
proposed rule, plants will be required to maintain daily records to 
document adherence to the SOPs (Sec.  416.16). FSIS is proposing to 
cross-reference 9 CFR part 416 in 9 CFR 591.1 rather than duplicate the 
regulatory text.
---------------------------------------------------------------------------

    \11\ Under 21 U.S.C. 1035, official plants must be operated in 
accordance with such sanitary practices and have such premises, 
facilities, and equipment as are required by regulations promulgated 
by the Secretary to effectuate the purposes of the EPIA.
---------------------------------------------------------------------------

    Sanitation SOPs are necessary because they clearly define each 
plant's responsibility to consistently follow effective sanitation 
procedures to minimize the risk of direct product contamination and 
adulteration. This proposal is based on FSIS's determination for meat 
and poultry plants that effective sanitation is essential for food 
safety and for the successful implementation of HACCP. FSIS is not 
aware of any reason why the same determination should not be made for 
egg products plants.
    Well-run plants have effective quality control and sanitation 
programs, including written Sanitation SOPs. Such programs are based, 
in large part, on the plants' recognition of the link between the 
existence of insanitary conditions during the processing and production 
of egg products and the likelihood that bacteria, including pathogenic 
bacteria, will contaminate the finished product. Some plants, however, 
do not have adequate programs and do not consistently maintain good 
sanitation. In fact, poor sanitation is the most frequently cited 
problem identified by FSIS inspection program personnel in egg products 
plants.
    If FSIS finalizes this proposal, all official plants will be 
required to develop, implement, and maintain written Sanitation SOPs, 
as well as comply with the Sanitation requirements (9 CFR 416.1-6), in 
accordance with 9 CFR part 416. As a result, FSIS is proposing to amend 
or replace many of the current sanitary requirements contained in 9 CFR 
590.500-575. The plant's Sanitation SOPs will need to describe all 
procedures the plant conducts daily to prevent direct contamination or 
adulteration of products (proposed 9 CFR 591.1(a) and 9 CFR 416.12(a)). 
The Sanitation SOPs will also need to specify the frequency with which 
each procedure in the Sanitation SOPs is to be performed and identify 
the plant employees responsible for implementing and maintaining the 
procedures (9 CFR 416.12(d)). The Sanitation SOPs will have to be 
signed and dated, upon initiation and any modification, by ``the 
individual with overall authority on-site or a higher level official of 
the plant.'' The signature will signify that the plant will implement 
and maintain the Sanitation SOPs in accordance with 9 CFR part 416 
(proposed 9 CFR 591.1 and 9 CFR 416.12(b)). Official plants will also 
have to identify their pre-operational sanitation procedures in their 
written Sanitation SOPs, distinguishing them from sanitation activities 
to be carried out during operations (proposed 9 CFR 591.1 and 9 CFR 
416.12(c)).
    Under this proposal, each plant will be required to conduct the 
pre-operational and operational procedures as specified in the 
Sanitation SOPs, monitor the conduct of the procedures, and routinely 
evaluate the effectiveness of the SOPs and modify the Sanitation SOPs 
as necessary, in light of changes to the facility, personnel, or 
operations, to ensure that they remain effective in preventing direct 
product contamination and adulteration (proposed 9 CFR 591.1 and 9 CFR 
416.13 and 416.14).
    Plants will have to take corrective action when either the plant or 
FSIS determines that the Sanitation SOPs, or their implementation, may 
have failed to prevent direct product contamination or adulteration (9 
CFR 416.15(a)). Corrective actions include ``procedures to ensure 
appropriate disposition of product(s) that may be contaminated, restore 
sanitary conditions, and prevent the recurrence of direct contamination 
or adulteration of product(s), including appropriate reevaluation and 
modification of the Sanitation SOPs and the procedures specified 
therein . . .'' (proposed 9 CFR 591.1 and 9 CFR 416.15(b)).
    If this proposed rule is adopted, plants will have to keep daily 
records documenting that the sanitation and monitoring procedures 
listed in the Sanitation SOPs are performed and maintain records 
documenting any corrective actions taken to prevent direct 
contamination or adulteration of products, or when the plant determines 
or FSIS notifies it that its Sanitation SOPs are inadequate (proposed 9 
CFR 591.1 and 9 CFR 416.16(a)). Under this proposal, records may be 
maintained on a computer, provided that plants implement controls to 
ensure the integrity of the electronic data (9 CFR 416.16(b)). Records 
could be retained off-site, provided that they are not removed from the 
plant for at least 48 hours following their completion, and that they 
can be provided to FSIS personnel within 24 hours of being requested (9 
CFR 416.16(c)).
    Under the proposed Sanitation SOPs, FSIS inspection program 
personnel will verify that plant management is conducting its 
operations in a sanitary environment and manner. Failure to comply with 
the Sanitation SOPs provides presumptive evidence of insanitation. As 
is now the case, inspection program personnel will act to prevent a 
facility from operating under insanitary conditions.

D. Sanitation Requirements

    In addition to Sanitation SOP requirements, FSIS is proposing to 
remove the current sanitation requirements discussed below for egg 
products plants from its regulations. Some of the existing plant 
sanitation requirements will no longer be needed in light of the 
proposed HACCP and Sanitation SOP requirements. Further, some of the 
existing plant sanitation requirements impede innovation and blur the 
distinction between plant and inspector responsibilities for 
maintaining sanitary conditions. Should these regulations become final, 
they will provide official plants with more flexibility to innovate 
with regard to facility design, construction, and operations.

[[Page 6321]]

    The sanitation requirements proposed in this rule will not only 
provide plants with the flexibility to innovate in facility design, 
construction, and operations but will also articulate the standards for 
good sanitation and for food product safety that must be met by egg 
products processors. All sanitation requirements have the same intent: 
A plant that processes egg products must operate under sanitary 
conditions, in a manner that ensures that the product is not 
adulterated and that does not interfere with FSIS inspection and its 
enforcement of such standards. However, because the proposed sanitation 
requirements define the results to be achieved by sanitation, but not 
the specific means to achieve those results, plants can meet the 
sanitation requirements in different ways. Regardless of the means by 
which plants comply with the standards under this proposed rule, the 
required results will be the same for all egg products plants.
    FSIS is proposing to replace most of the current sanitation 
regulations in 9 CFR 590.500 through 590.560 with the general 
sanitation requirements set out in 9 CFR 416.1 through 416.6, which the 
Agency is proposing to incorporate by reference (proposed 9 CFR 
591.1(a)). This proposed change will significantly reduce the number of 
egg and egg products sanitation regulations and consolidate most 
sanitation requirements for eggs and egg products with those for meat 
and poultry products.
General Sanitation--9 CFR 416.1 and Proposed 9 CFR 591.1
    The current sanitation regulations for eggs and egg products 
require that plants, including rooms, windows, and floors, be kept 
clean and reasonably dry, and free from objectionable odors, flies, 
insects, and rodents. Section 416.1 of 9 CFR, which applies to meat and 
poultry establishments, provides greater flexibility: ``Each official 
establishment must be operated and maintained in a sanitary manner 
sufficient to ensure that product is not contaminated, adulterated, or 
misbranded.'' Unlike command-and-control regulations, examples of which 
are cited below, 9 CFR 416.1 will provide facilities with the maximum 
possible flexibility to innovate in facility design, construction, and 
operation.
    Examples of current requirements to be replaced by the general 
standards are: Sec.  590.500(d), which states that materials and 
equipment not currently needed shall be handled or stored in a manner 
so as not to constitute a sanitary hazard; Sec.  590.500(e), concerning 
doors and windows leading to rooms where exposed edible product is 
handled; Sec.  590.522(a) concerning breaking room operations; and 
Sec.  590.539(a), concerning the defrosting of frozen egg product in a 
sanitary manner.
    The proposed rule would also provide flexibility to industry in 
facility design, construction, and operation by the replacement of the 
following regulations with the general standards in 9 CFR 416.1: Sec.  
590.506(c), which requires the installation of an approved exhaust 
system for the continuous removal directly to the outside of any steam, 
vapors, odors, or dust in the candling and transfer room; Sec.  
590.508(a), which states that candling and transfer rooms and equipment 
shall be kept clean, free from cobwebs, dust, objectionable odors, and 
excess packing materials; and Sec.  590.546(b), which requires that the 
air intake source in albumen flake process drying facilities be free 
from foul odors, dust, and dirt.
Establishment Grounds and Pest Management--9 CFR 416.2(a)
    The current egg products plant requirements for facility grounds 
are unnecessarily prescriptive. For example, 9 CFR 590.500(b) requires 
that the premises be free from refuse, waste, and other materials and 
conditions that constitute a source of odors or a harbor for insects, 
rodents, and other vermin, while Sec.  590.500(g) states that drains 
and gutters shall be properly installed with approved traps and vents. 
Several other sections (Sec. Sec.  590.542(a), 547(a), and 548(a)) 
require that rooms be kept free of flies, insects, and rodents.
    The other prescriptive establishment grounds regulations are 9 CFR 
590.500(a) and (c), which require that the plant be free from 
objectionable odors, dust, and smoke-laden air and state that the 
buildings shall be of sound construction and kept in good repair to 
prevent the entrance or harboring of vermin, and Sec.  590.522(a), 
which states that the breaking room shall be kept in dust-free clean 
condition and free from flies, insects, and rodents. In addition, 9 CFR 
590.522(a) requires that the plant keep the floor clean and reasonably 
dry during breaking operations and free of egg meat and shells.
    The general sanitation requirements in 9 CFR 416.2(a) preserve the 
intent of these requirements that grounds be maintained to prevent 
conditions that could lead to the contamination or adulteration of 
product, and that establishments implement and maintain an integrated 
pest control program to eliminate the harborage of pests on the grounds 
and within the plant facilities. This regulation, however, provides the 
flexibility and leave to innovate that the Agency is proposing to 
incorporate into the egg product regulations.
Establishment Construction--9 CFR 416.2(b)
    The egg products inspection regulations concerning construction of 
egg products plants are very prescriptive and inflexible. For example, 
9 CFR 590.500 prescribes numerous, specific requirements for different 
areas within an official plant, e.g., dressing rooms, toilet 
facilities, and refuse rooms. Other regulations containing prescriptive 
construction requirements include Sec.  590.506, candling and transfer-
room facilities and equipment; Sec.  590.520, breaking room facilities; 
Sec.  590.546, albumen flake process drying operations, Sec.  590.560, 
concerning personnel facilities; and Sec.  590.570(a), concerning 
pasteurization facilities.
    Section 416.2(b) of 9 CFR sets out construction sanitation 
requirements that will allow for increased flexibility in regard to 
facility operation construction and maintenance if adopted by reference 
through proposed 9 CFR 591.1. Plants will be able to design facilities 
and equipment in the manner that they deem best to maintain the 
required sanitary environment for food production.
    In addition to the six prescriptive egg products construction 
regulations listed above, there are seven more construction 
requirements that will be replaced by 9 CFR 416.2(b) if this proposal 
is finalized. They are 9 CFR 590.146(b)(5) and (d), concerning the 
requirements for floor plans and revised blueprints submitted prior to 
receiving inspection service or making changes or revisions to an 
official plant; Sec.  590.500(i), (j), (l), and (o), concerning 
structure construction materials, maintenance requirements for rooms in 
which shell eggs or egg products are handled, and toilet and refuse 
room requirements; Sec.  590.532(a), concerning liquid egg holding tank 
requirements; Sec.  590.534(a), concerning freezing room requirements; 
Sec.  590.548(c), which addresses heat treatment room construction 
requirements; Sec.  590.550, dealing with washing and sanitizing room 
or area facility requirements; and Sec.  590.560(a) and (b), concerning 
the health and hygiene of plant personnel and the construction of 
personnel facilities.
Light--9 CFR 416.2(c)
    The lighting requirements for breaking rooms in official plants in 
Sec.  590.520(a) prescribe specific light intensities for all working 
surfaces in the room and at breaking and inspection stations. For 
example, all working

[[Page 6322]]

surfaces must have at least 30 foot-candles of light intensity, while 
breaking and inspection stations must have at least 50 foot-candles of 
light intensity. Other egg products regulations do not contain specific 
lighting requirements, stating only that rooms shall be adequately or 
well-lighted (see Sec. Sec.  590.500(l)(i), 548(a), and 550(a)).
    The intent of the lighting requirements is to ensure that there is 
enough light of adequate quality to monitor sanitary conditions and 
processing operations and to examine product for evidence of 
adulteration or misbranding. Section 416.2(c) of 9 CFR has codified 
this intent as a general sanitation requirement, and it will be 
applicable to plants that process egg products if this proposed rule is 
finalized. Under 9 CFR 416.2, which requires that lighting be of good 
quality and of sufficient intensity to ensure that sanitary conditions 
are maintained, and that product is not adulterated, plants will have 
the flexibility to determine what light intensities are appropriate to 
ensure sanitation in different operational contexts. Therefore, FSIS is 
proposing to remove Sec. Sec.  590.500(l)(1), 520(a), 548(a), and 
550(a) from the egg products inspection regulations.
Ventilation--9 CFR 416.2(d)
    The egg products inspection regulations addressing ventilation 
generally require that ventilation provide for a positive flow of 
outside filtered air through rooms and air of suitable working 
temperature during operations, and that rooms be kept free from 
objectionable odors and condensation (see Sec. Sec.  590.500, 
590.504(p), 590.506(c), 590.520(d), 590.550(a)). Objectionable odors or 
condensation are to be reduced to the extent possible or eliminated 
because they can adulterate product. FSIS has codified a single 
sanitation requirement, 9 CFR 416.2(d), which preserves the intent of 
the current egg products regulations. This codification will simplify 
FSIS's egg products ventilation regulations by consolidating them into 
9 CFR 416.2(d).
    In addition to the regulations discussed above, FSIS is proposing 
to remove the following regulations from 9 CFR part 590 because they 
will be replaced by proposed 9 CFR 416.2(d) if this rule is finalized: 
9 CFR 590.435(d), which states that containers and packing or packaging 
materials in which shell eggs are received into the official plant 
shall be free from odors and materials which could contaminate or 
adulterate the eggs or egg products; Sec.  590.508(b), requiring the 
removal of containers for trash and inedible eggs at least once daily 
and their cleaning and treatment in such a manner as to prevent odors 
or objectionable conditions in the plant; Sec.  590.530(a), which 
states that liquid egg storage rooms, including surface coolers and 
holding tank rooms, shall be kept clean and free from odors and 
objectionable odors and condensation; and Sec.  590.536(a), concerning 
the conditions in which freezing rooms are to be kept.
    Other regulations to be replaced by 9 CFR 416.2(d) will be: 9 CFR 
590.540(d), which states that air drawn into the drier in spray process 
drying facilities be free from foul odors, dust, and dirt; Sec.  
590.546(b), requiring that intake air sources in albumen flake process 
drying facilities be free from foul odors, dust, and dirt; Sec.  
590.549, requiring that dried egg storage be sufficient to adequately 
handle the production of the plant and be kept clean, dry, and free 
from objectionable odors; and Sec.  590.560(b), requiring that toilets 
and dressings be kept clean and that toilet rooms be ventilated to the 
outside of the building.
Plumbing--9 CFR 416.2(e)
    The design, installation, and maintenance of an adequate plumbing 
system are key responsibilities of an egg products plant. Because 
plumbing systems carry water into plants and convey water, sewage, and 
other waste from plants, problems with plumbing systems can easily 
cause product contamination or adulteration. The plumbing sanitation 
requirements in 9 CFR 416.2(e) set out the essential condition plants 
must achieve with their plumbing systems: plumbing systems cannot cause 
adulteration of product and must ensure sanitary operating conditions. 
Plants otherwise will be allowed to build plumbing systems suitable to 
the nature and volume of their production. Therefore, FSIS is proposing 
to eliminate the requirement in Sec.  590.500(g) that drains and 
gutters with approved traps and vents be installed. The Agency is also 
proposing to eliminate the prescriptive requirements regarding lavatory 
accommodations in Sec.  590.500(l) and (m).
Sewage Disposal--9 CFR 416.2(f)
    The current regulations require any person desiring to process egg 
products under continuous inspection to submit drawings and 
specifications before receiving approval of a plant and facilities as 
an official plant. Information that must be submitted includes how the 
plant intends to dispose of sewage (Sec.  590.146(b)(7)). Section 
590.504(q) states that all liquid and solid material in the official 
plant shall be disposed of in a manner approved by the Administrator to 
prevent product contamination and in accordance with acceptable 
environmental protection practices.
    Section 416.2(f) of 9 CFR, sewage disposal, will replace both of 
these regulations by requiring that sewage be disposed into a sewage 
system separate from all other drainage lines or disposed of through 
other means sufficient to prevent backup of sewage into areas where 
product is processed, handled, or stored.
Water Supply and Reuse--9 CFR 416.2(g)
    The current regulations regarding water supply and reuse in plants 
require that the water supply be ample, clean, and potable, with 
adequate pressure and facilities for its distribution throughout the 
plant or portion thereof utilized for egg processing and handling 
operations and protected against contamination and pollution (Sec.  
590.500(h)). Section 590.500(h) also requires that the applicant for 
inspection obtain and furnish to the Administrator, at the 
Administrator's request, a water report, issued under the authority of 
a State or municipal health authority, certifying to the potability of 
the water supply. When ice is used as an emergency refrigerant by being 
placed directly into the egg meat, Sec.  590.530(f) requires that the 
source of the ice be certified by the local or State board of health 
and that the ice be handled in a sanitary manner.
    Section 416.2(g)(1) of 9 CFR sets out a transparent water supply 
performance standard concerning potable water. The water must comply 
with Environmental Protection Agency (EPA) National Primary Drinking 
Water regulations. These EPA regulations are applicable to public water 
systems. Because these regulations already apply to potable water used 
by egg products plants, the reference in the sanitation requirements 
would not constitute a new requirement for these plants. The sanitation 
requirement also restates the current requirement that plants must make 
available to FSIS, upon request, State or local certificates attesting 
to water quality.
    The egg products industry uses large quantities of water for 
processing products and for cleaning. Water and water based (aqueous) 
solutions are widely used for prewetting, washing, and rinsing eggs, 
product formulation, and cleaning and sanitizing equipment. Reuse of 
water solutions, therefore, can offer significant economic advantages.
    Section 590.515(a), for example, sets forth the requirements for 
washing shell

[[Page 6323]]

eggs to be presented for breaking. They include changing the wash water 
every four hours or more often if needed to maintain sanitary 
conditions and at the end of each shift (paragraph (a)(4)); adding 
replacement water to the wash water of washers continuously to maintain 
a continuous overflow (paragraph (a)(5)); piping waste water from the 
egg washing operation directly to drains (paragraph (a)(6)); and 
completing continuous washing operation as rapidly as possible 
(paragraph (a)(7)). Section 590.516(a) requires that all shell eggs be 
spray rinsed with potable water containing an approved sanitizer of not 
less than 100 ppm but no more than 200 ppm of available chlorine or its 
equivalent immediately prior to breaking.
    Section 590.552 establishes cleaning and sanitizing requirements 
for equipment used in egg processing operations that comes in contact 
with liquid eggs or exposed edible products. While such equipment may 
be cleaned by any sanitary means, it is preferable to use water to do 
so. Paragraph (b)(2) requires that shell eggs that have been sanitized 
and equipment that comes in contact with edible products be rinsed with 
clean water after sanitizing if other than hypochlorites are used as 
sanitizing agents.
    Section 416.2(g)(2) through (6) of 9 CFR sets forth sanitation 
requirements for the reuse of water in meat and poultry establishments. 
If this proposal is adopted, plants will also be able to use reuse 
water in their operations, as appropriate.
    Prior to the implementation of 9 CFR 416.2(g), reuse water was 
permitted in meat and poultry establishments only under certain 
circumstances, and any other reuse situation had to be approved by the 
Agency in advance. However, once technologies were developed that can 
recondition water for safe and effective reuse in various applications, 
the Agency recognized that reuse water may be used safely and 
effectively in certain food processing situations.
    Under 9 CFR 416.2(g), reuse water can be treated to render it free 
of biological, chemical, and physical hazards. Some of the general 
treatment options used include filtration, chlorination, ozonation, 
ultraviolet (UV) radiation, and heating. Use of these procedures can 
usually return water to a level of quality appropriate to its intended 
use. After treatment, however, such water should be tested regularly to 
ensure continual freedom from biological, chemical, or physical 
hazards.
    Depending upon the original use, the intended use, and the duration 
of reuse, a wide range of acceptable biological, chemical, or physical 
contaminant levels are possible in reuse water. The previous degree of 
exposure or potential exposure to contaminants dictates the appropriate 
reconditioning treatment and the allowable reuse.
    FSIS requires official egg products plants to produce pasteurized, 
RTE products that are free of pathogens. Therefore, reuse water that is 
used to chill or cook pasteurized, RTE egg products must be free of 
fecal coliforms because their presence would indicate that the water 
was contaminated, possibly with pathogenic organisms (9 CFR 
416.2(g)(2)). Other types of contamination will also have to be reduced 
sufficiently to prevent adulteration of product.
    Section 416.2(g)(3) of 9 CFR deals with the use and reuse of water, 
ice, and solutions used to chill or wash raw product. In response to 
questions raised at public meetings in Columbus, OH, and Sacramento, 
CA, on March 30 and April 6, 2000, and Washington, DC, on July 31, 
2001, held to obtain comments on FSIS's and FDA's thinking at the time 
on approaches to ensure egg safety from farm to table, FSIS has 
tentatively concluded that unprocessed shell eggs, i.e., eggs that have 
not yet been washed, sized, or candled, are more like raw product than 
RTE product. As a result, FSIS has determined that the provisions of 9 
CFR 416.2(g)(3), which regulate the use of reuse water to wash raw 
product, will apply to official plants. Consequently, water used to 
wash unprocessed shell eggs may be reused for the same purpose, 
provided that measures are taken to reduce biological, chemical, and 
physical contamination so as to prevent contamination or adulteration 
of the eggs. Such reused water from use on raw eggs may not come into 
contact with processed shell eggs.
    Paragraph (g)(4) of 9 CFR 416.2 will allow plants that recondition 
their water through an advanced wastewater treatment facility to use 
such reconditioned water on raw product, except in product formulation 
and throughout the plant in edible and inedible production areas. This 
water is not, however, potable, and it may not have ever contained 
human waste. Product, facilities, and equipment coming in contact with 
this water must undergo a separate final rinse with non-reconditioned 
water that meets the criteria prescribed in 9 CFR 416.2(g)(1). The 
reuse water described above would most likely be used to wash solid 
waste from equipment and floors.
    Paragraph (g)(5) of 9 CFR 416.2 will permit plants to use any water 
for any purpose in edible or inedible product areas, provided that it 
has never contained human waste, has been conditioned to be free of 
pathogenic organisms, and does not contact edible product. Finally, 
paragraph (g)(6) states that any water not meeting the conditions of 9 
CFR 416.2(g)(1) through (5) may not be used, except in areas where no 
edible product is handled or prepared, and may not be used in any 
manner which would allow it to contaminate or adulterate edible 
product.
    Moving the egg products water supply and reuse regulations into 9 
CFR 416.2(g) will consolidate them with those for meat and poultry. The 
proposed sanitation requirements in 9 CFR 416.2(g) are intended to and 
should account for every allowable water reuse situation in official 
plants, including those covered by the following egg products 
inspection regulations, which will be replaced by 9 CFR 416.2(g) if 
this proposal is finalized: Sec.  590.520(e), which requires adequate 
and easily accessible hand washing facilities in an official plant; 
Sec.  590.539(d)(1), which permits frozen eggs packed in metal or 
plastic containers to be placed in running tap water (70 degrees F or 
lower) without submersion to speed defrosting; and Sec.  590.552(a) and 
(b)(2), concerning equipment cleaning and sanitizing requirements.
Dressing Rooms, Lavatories, and Toilets--9 CFR 416.2(h)
    The current regulations concerning dressing rooms, lavatories, and 
toilets in egg products plants are highly prescriptive. For example, 
Sec.  590.500(l)(2) provides a formula that serves as the basis for 
determining the toilet facilities required in an official plant, the 
intent being to ensure that plants provide an adequate number of toilet 
bowls, thus maintaining related sanitary conditions. The sanitation 
requirement in 9 CFR 416.2(h) gives plants the responsibility and 
flexibility to determine how many dressing rooms, lavatories, and 
toilets it needs. Of course, plants will have to meet any applicable 
State and local codes concerning the number of lavatories and toilets 
in the workplace.
    There are also other requirements for dressing rooms, lavatories, 
and toilets currently in the egg products regulations (see Sec.  
590.520(e), concerning hand washing facilities in breaking rooms, Sec.  
590.560(a) and (b), concerning health and hygiene of personnel, and 
Sec.  590.146(b)(5), requiring floor plans to show the locations of 
hand-washing facilities and toilets). The proposed sanitation 
requirement in 9 CFR 416.2(h) eliminates the need for these

[[Page 6324]]

requirements because it renders them redundant.
Equipment and Utensils--9 CFR 416.3
    The egg products inspection regulations concerning equipment and 
utensils are unduly prescriptive and can deprive official plants of the 
flexibility to innovate in regard to equipment and utensil sanitation. 
The equipment and utensil sanitation requirement that FSIS is proposing 
to adopt for plants not only provides flexibility but also clarifies 
plant responsibility for selecting and maintaining equipment and 
utensils in a manner that effectively prevents product contamination or 
adulteration.
    If this proposal is adopted, plants will no longer have to install 
and use equipment that complies with the applicable 3-A or E-3-A 
Sanitary Standards and accepted practices currently in effect for such 
equipment (Sec.  590.502(b)). Instead, equipment and utensils used for 
processing or otherwise handling edible product or ingredients will 
only have to be of such material and construction as to facilitate 
thorough cleaning and be durable and suitable for its intended use. 
Plants will need to ensure that product is not contaminated, 
adulterated, or misbranded during processing, handling, or storage. 
Equipment and utensils will still need to be maintained in sanitary 
condition so as not to contaminate or adulterate product. In addition 
to 9 CFR 590.502(b), FSIS is also proposing to remove the following 
sections from 9 CFR part 590 because 9 CFR 416.3 will make them 
redundant:

 Sec.  590.500(n), requiring suitable facilities for cleaning 
and sanitizing utensils and equipment at convenient locations 
throughout the plant
 Sec.  590.504(f) and (n), requiring personnel handling 
utensils or containers which may come into contact with egg products to 
wash their hands and maintain them in a clean condition and requiring 
most utensils and equipment to be clean and sanitized at the beginning 
of processing operations and kept clean and sanitary during all 
processing operations
 Sec.  590.506(a), which states that the equipment shall be 
arranged to facilitate cleaning and the removal of refuse and excess 
packing material from the candling and transfer room
 Sec.  590.508(c) and (d), requiring the handling of shell eggs 
in a manner to minimize sweating prior to breaking and placing shell 
eggs with extensively damaged shells, unless otherwise prohibited, into 
leaker trays
 Sec.  590.515(a)(1) and (b), requiring that shell egg cleaning 
equipment be kept in good repair and be cleaned after each day's use or 
more frequently, if necessary, and requiring that the temperature of 
wash water be maintained at 90 degrees F or higher, and shall be at 
least 20 degrees F warmer than the temperature of the eggs to be 
washed, throughout the cleaning cycle
 Sec.  590.520(g), states that a suitable container 
conspicuously identified shall be provided for the disposal of rejected 
liquid
 Sec.  590.522(d), (h), (s), (t), (u), (v), (y), (aa)(1)-(3), 
containing prescriptive requirements for the cleaning of breaking 
machines and equipment, including mechanical breaking machines, as well 
as other equipment used in the processing of egg products, such as 
cups, knives, racks, etc., dump tanks, drawoff tanks, and churns, 
strainers, filtering devices, etc., and containers used for 
transporting liquid eggs products
 Sec.  590.538, concerning the construction and cleaning of 
defrosting facilities
 Sec.  590.539(f), concerning the cleaning of crushers and 
other equipment used in defrosting operations
 Sec.  590.540(h), requiring the construction of powder 
conveying equipment as will facilitate thorough cleaning
 Sec.  590.542(b)(2) and (c)(1), requiring the sanitizing of 
spray process drying equipment within 2 hours prior to resuming spray 
drying operations and the clearing of sifters and conveyers used for 
other than dried albumen powder when such equipment is not to be used 
for 24 hours or longer
 Sec.  590.548(b)(3)-(5), which requires that equipment and 
utensils used in dried eggs be kept off the floor and be kept clean at 
all times and whenever contaminated be cleaned and sanitized. It also 
requires that all equipment used to mechanically package dried egg 
products be vacuum cleaned daily
 Sec.  590.560(c) and (d), prohibiting personnel affected with 
any communicable disease in a transmissible stage or a carrier of such 
disease, or affected by a list of other health conditions, from coming 
into contact with equipment used to process eggs. Paragraph (d) 
requires workers coming in contact with equipment to wear clean outer 
uniforms
Food-Contact Surface Cleaning and Sanitation--9 CFR 416.4(a)
    The egg products inspection regulations require that egg products 
plants clean food contact surfaces at the start of processing 
operations, and that they keep equipment and utensils clean and 
sanitary during all processing operations (9 CFR 590.504(n)). Section 
590.522(aa)(3) of 9 CFR states that mechanical egg breaking equipment 
shall be clean and sanitized prior to use, and during operations the 
machines shall be cleaned and sanitized approximately every 4 hours or 
more often if needed to maintain them in a sanitary condition. It also 
requires that the equipment be cleaned at the end of each shift. See 
also 9 CFR 590.552(a).
    The objective of the food-contact surface cleaning requirements has 
always been to mitigate biological, chemical, and physical 
contamination that could adulterate product. The proposed food-contact 
surface cleaning sanitary operations requirement in 9 CFR 416.4(a) 
embodies this objective and clarifies plant responsibility for 
determining how best to achieve it. The advantage of this proposed 
standard is that it would provide plants with the flexibility to 
innovate when determining how to mitigate biological, chemical, and 
physical contamination that could adulterate product. For this reason, 
therefore, FSIS is proposing to remove the egg products inspection 
regulations discussed above, as well as following sections, and replace 
them with the sanitary operations requirement in 9 CFR 416.4(a):

 Sec.  590.504(i) and (k), requiring the removal, cleaning, and 
sanitizing of utensils and equipment that are contaminated during the 
course of processing egg products and containing the admonition that 
all reasonable precautions be taken to avoid soiling or contaminating 
the surface of any package or container liner which is or will be in 
direct contact with egg products
 Sec.  590.515(a)(4), which states that wash water will be 
changed every four hours or more often, if needed, to maintain sanitary 
conditions and at the end of each shift
 Sec.  590.522(x), (z), and (aa)(2), requiring that containers 
for holding egg products variously be washed, rinsed, sanitized, and 
drained immediately prior to use and cleaned after each use. The 
pipelines of systems for pumping egg liquid directly from egg breaking 
machines must be cleaner or flushed as often as necessary to maintain 
them in a sanitary condition, and they must be cleaned and sanitized at 
the end of each shift. Other pumping system equipment must be cleaned 
and sanitized at least every four hours or sooner to maintain it in 
sanitary condition

[[Page 6325]]

 Sec.  590.539(e), which states that sanitary methods will be 
used in handling containers and removing egg product
 Sec.  590.542, which includes prescriptive requirements for 
maintaining sanitary conditions in spray process drying operations
 Sec.  590.544(c) and (d), which states that dry blending must 
be done in accordance with Sec.  590.548 or in a closed blending system 
and in accordance with clean, sanitary practices. Edible dried egg 
powder may be reconstituted, repasteurized, and redried when 
accomplished in a clean, sanitary manner
 Sec.  590.548(b)(4), which includes prescriptive requirements 
for maintaining sanitary conditions in drying, blending, packaging, and 
heat treatment rooms and facilities.
Non-Food-Contact Surface Cleaning and Sanitation--9 CFR 416.4(b)
    If this proposed rule (proposed 9 CFR 591.1) is adopted, official 
plants that process egg products will have to keep, in accordance with 
9 CFR 416.4(b), non-food-contact surfaces, such as floors and walls, 
free of any biological contaminants, chemical contaminants, or physical 
contaminants that could adulterate egg products. FSIS is proposing to 
remove the following sections and replace them with the sanitary 
operations requirement in 9 CFR 416.4(b) because this requirement will 
give plants greater flexibility and responsibility for developing 
sanitary procedures specific to the nature of their operations:

 Sec.  590.500(j) and (l)(1), requiring rooms and compartments 
in which shell eggs or egg products are handled or processed to be 
maintained in a clean and sanitary condition
 Sec.  590.504(g) and (h), prohibiting the storage of products 
or materials that create objectionable conditions in any room, 
compartment, or place where shell eggs or egg products are processed, 
stored, or handled and permitting only compounds approved by the 
Administrator that will not deleteriously affect shell eggs or egg 
products when used in an approved manner to be used in an official 
plant
 Sec.  590.515(b), prohibiting shell eggs from being washed in 
the breaking room or any room where edible products are processes
 Sec.  590.522(m), stating that ingredients used in, or for, 
processing egg products, must be handled in a clean and sanitary manner
 Sec.  590.546(b), requiring that intake air sources be free 
from foul odors, dust, and dirt
 Sec.  590.548(b)(3), requiring that dry blending equipment and 
supplies be kept off of the floor
Cleaning Compounds and Sanitizers--9 CFR 416.4(c)
    Section 590.504(h) of 9 CFR requires that FSIS approve detergents, 
wetting agents, or other similar compounds, among other things, before 
they can be used within an official plant. Section 590.552(b) of 9 CFR 
states that sanitizing shall be accomplished by such methods as 
approved by the Administrator and requires the approval of chemicals 
and compounds used for sanitizing by the Administrator before use. 
These requirements are intended to ensure that egg products are not 
adulterated with chemicals or any injurious substance.
    FSIS is proposing to replace 9 CFR 590.504(h) and 552(b) with 
proposed 9 CFR 591.1 and the single sanitary operations requirement in 
9 CFR 416.4(c), which states that cleaning compounds and sanitizing 
agents must be safe and effective under the conditions of use, and that 
plants would not be required to obtain prior approval from FSIS. If 
this proposed rule becomes final, plants that process egg products 
would be able to use cleaning compounds and sanitizing agents that are 
safe and effective under the conditions of use. They would have to use, 
handle, and store them in a manner that would not adulterate product or 
create insanitary conditions and maintain documentation to support that 
these compounds and agents are safe and effective. Plants would, 
however, have to meet the use requirements for the substances 
promulgated by other regulatory agencies, such as FDA and EPA, who are 
responsible for ensuring that these substances are safe for their 
intended uses.
Operational Sanitation--9 CFR 416.4(d)
    The egg products requirements for operational sanitation 
(sanitation measures carried out during operations) are spread through 
a number of regulations. (See 9 CFR 590.515 concerning egg cleaning 
operations; Sec.  590.516 concerning sanitizing and drying of egg 
shells prior to breaking; and Sec.  590.522 concerning breaking room 
operations.)
    These requirements are unnecessarily prescriptive. For example, 
Sec.  590.515(a)(4) requires an official plant to change wash water 
approximately every 4 hours or more often if needed to maintain 
sanitary conditions and at the end of each shift. Section 590.522(s) 
requires the cleaning and sanitizing of cups, knives, racks, 
separators, trays, spoons, liquid egg pails, and other breaking 
equipment every 2\1/2\ hours.
    If adopted, the sanitary operations requirement in 9 CFR 416.4(d) 
will consolidate the concepts in all of these operational sanitation 
requirements (which are discussed in this preamble and are currently 
spread throughout Sec. Sec.  590.500-575) in a single place and remove 
them from the egg products inspection regulations. Plants will be 
required to protect egg products from adulteration during processing, 
handling, storage, loading, and unloading at and during transportation 
from their premises.
Employee Hygiene--9 CFR 416.5(a)
    The current egg products inspection regulations mandate specific 
employee hygiene practices which egg products plants must adopt. For 
example, plant personnel handling exposed edible product must wash 
their hands before beginning work and upon returning to work after 
leaving the work room (Sec.  590.560(e)). Section 590.560(f) states 
that expectorating or other unsanitary practices are not permitted in 
official plants.
    The proposed sanitation requirement in 9 CFR 416.5(a) requires that 
all persons working in contact with product, food-contact surfaces, and 
product-packaging materials adhere to hygienic practices while on duty 
to prevent adulteration of product and the creation of insanitary 
conditions. It would, if adopted, allow plants to develop alternative 
or innovative means to ensure that employee hygiene practices do not 
result in product adulteration, without being as prescriptive and 
restrictive as the current egg products inspection regulations. 
Therefore, FSIS is proposing to remove Sec.  590.560 and replace it 
with the proposed sanitation requirement in Sec.  416.5(a).
Employee Clothing--9 CFR 416.5(b)
    The requirements regarding employee clothing are prescriptive. For 
example, Sec.  590.560(d) states that workers coming into contact with 
liquid or dried eggs, containers, or equipment shall wear clean outer 
uniforms, while paragraph (h) of that section requires all persons in 
breaking and packaging rooms to properly wear hair nets or caps. 
Section 590.560(g) prohibits the use of tobacco in any form or the 
wearing of jewelry, nail polish, or perfumes in any area where edible 
products are exposed.
    As stated in the previous section, FSIS is proposing to remove 
Sec.  590.560 and replace it with the sanitation requirement in 9 CFR 
416.5(b) and proposed 9 CFR 591.1(a). If the

[[Page 6326]]

proposed rule is finalized, cleanliness in employee hygiene would be 
required without the prescriptiveness of Sec.  590.560. Under 9 CFR 
416.5(b), aprons, frocks, and other outer clothing worn by persons in 
plants processing egg products who handle product must be made of 
material that is disposable or readily cleaned. Clean garments will 
also have to be worn at the start of each working day, and garments 
will have to be changed during the day as often as necessary to prevent 
adulteration of product and creation of insanitary conditions.
Employee Disease--9 CFR 416.5(c)
    The sanitation requirement in 9 CFR 416.5(c) is similar to the 
requirements for employee health in Sec.  590.560(c) to prevent 
transmission of communicable diseases. FSIS is proposing to remove 
Sec.  590.560(c) and adopt proposed 9 CFR 591.1 and 416.5(c) for egg 
products plants.
Tagging Insanitary Equipment, Rooms, or Compartments--9 CFR 416.6
    Retention tags or other devices and methods as may be approved by 
the Administrator are used for the control and identification of 
equipment, utensils, rooms, or compartments in official plants that are 
found to be unclean or otherwise in violation of the egg products 
inspection regulations (Sec.  590.426). This requirement is similar to 
the sanitation requirement articulated in 9 CFR 416.6, which requires 
the attachment of a ``U.S. Rejected'' tag to any equipment, utensil, 
room, or compartment at an official establishment that is insanitary, 
or the use of which could cause the adulteration of product. Both 
regulations prohibit the use of tagged equipment, utensils, rooms, or 
compartments until they have been made acceptable and require the 
removal of tags by program employees. Therefore, FSIS is proposing to 
replace Sec.  590.426 with 9 CFR 416.5(c) and proposed 9 CFR 591.1. 
This proposed sanitation requirement for plants that process egg 
products would serve to provide consistency between the egg products 
requirements and the meat and poultry requirements.
Sanitation Performance Standards Compliance Guide
    To meet the sanitation requirements proposed in this document, egg 
products plants may develop and employ sanitation or processing 
procedures customized to the nature and volume of their production. 
However, FSIS has developed a Sanitation Performance Standards 
Compliance Guide (Compliance Guide) that presents or references methods 
already proven to be effective in maintaining sanitary conditions in 
meat and poultry products establishments, which is posted on the 
Agency's web page: http://www.fsis.usda.gov/wps/portal/fsis/topics/regulatory-compliance/compliance-guides-index/sanitation-performance-standards. If this proposed rule is adopted, and before it takes 
effect, FSIS will update the Compliance Guide to include methods that 
are effective in maintaining sanitary conditions in egg products 
plants. Past FSIS regulations and guidance, as well as recommendations 
from the current Model Food Code issued by FDA and other technical 
sources, will be included or cited.
    Plants that follow the recommendations in the Compliance Guide 
could be reasonably certain that they will be meeting the sanitation 
requirements. They would need to be mindful, however, that each 
processing environment is unique, and that in some cases, the methods 
presented in the Compliance Guide might require validating the adequacy 
to ensure sanitary conditions or to prevent the adulteration of egg 
products.

E. Egg Products Are ``Ready-To-Eat''

    21 U.S.C. 1036(a) requires that egg products inspected at an 
official plant and found to be not adulterated be pasteurized before 
they leave the official plant, except as otherwise permitted by the 
regulations of the Secretary. Any detectable pathogen would adulterate 
egg products under 21 U.S.C. 1033(a)(1) because it would contain a 
poisonous or deleterious substance which may render them injurious to 
health. Pasteurized egg products are ready-to-eat; that is, they have 
been prepared so that they can be consumed as is, without any 
additional cooking.
    In 2005, FSIS undertook a quantitative microbial risk assessment to 
assist Agency risk managers in evaluating possible pasteurization 
performance standards for reducing the likelihood of Salmonella spp. 
contamination in liquid and dried egg products, and, subsequently, for 
reducing the risk of human illness, hospitalization, and death 
associated with egg products.\12\ However, while the risk assessment 
showed that pasteurization resulting in a 6-log10 reduction 
of Salmonella was predicted to be effective for reducing illnesses from 
Salmonella spp. in egg products, FSIS has chosen to propose a standard 
for egg products that requires them to be produced to be edible without 
additional preparation to achieve food safety. FSIS has chosen this 
approach because in-plant inspectors cannot effectively verify whether 
a plant has met a specific lethality standard. The Agency can, however, 
effectively verify whether Salmonella is present in an egg product 
through testing. Overall, this approach is simpler than that of 
log10 pasteurization performance standards and is consistent 
with the approach used by FSIS in establishing requirements for most 
RTE meat and poultry products.
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    \12\ FSIS. 2005. Risk Assessments of Salmonella Enteritidis in 
Shell Eggs and Salmonella spp. in Egg Products. (http://www.fsis.usda.gov/wps/portal/fsis/topics/science/risk-assessments).
---------------------------------------------------------------------------

    Meat and poultry establishments produce the vast majority of their 
RTE products without needing to meet FSIS-specified time and 
temperature combinations or lethality performance standards codified in 
the regulations. The only FSIS regulations that include specific times 
and temperatures for ready-to-eat products are for cooked uncured meat 
patties, which must meet or exceed the times and temperatures listed in 
9 CFR 318.23, and for pork, and products containing pork, which must 
meet or exceed the times and temperatures listed in 9 CFR 318.10. 
Cooked beef and poultry products must meet the lethality performance 
standards listed in 9 CFR 318.17 and 381.150. FSIS previously removed 
prescriptive time and temperature requirements for other ready-to-eat 
meat and poultry products from the meat and poultry regulations. Such 
prescriptive time and temperature requirements are not necessary 
because under the statutes, establishments need to produce ready-to-eat 
products (including egg products) so that no detectable pathogens exist 
in the final products.
    Therefore, FSIS is proposing to amend the egg products inspection 
regulations by removing the prescriptive regulations on the 
pasteurization of egg products (9 CFR 590.570 and .575). If this 
proposed rule is finalized, 9 CFR 590.570 would be replaced by a new 
regulation specifying that egg products are ready-to-eat and do not 
require additional steps to ensure food safety, consistent with the 
definition of ``ready-to-eat'' product in 9 CFR 430. Egg products must 
be produced such that the finished product is free of detectable 
pathogens. In addition, egg products would not be required to bear a 
safe-handling instruction or other labeling that directs that the 
product must be cooked or otherwise treated for safety.
    The current requirements for egg products mandate step-by-step

[[Page 6327]]

processing measures and specifically prescribe minimal time and 
temperature combinations for the pasteurization treatment of various 
egg products. Under HACCP, these prescriptive requirements are not 
necessary. Under HACCP, egg products plants are required to produce 
product by controlling, eliminating, or reducing microbial hazards so 
that the finished product has no detectable pathogens.
    Plants that choose not to develop new or modified procedures will 
be able to continue to follow a set of pasteurization time and 
temperature combinations for products that have been validated as 
achieving the intended pathogen reduction, such as those in the current 
regulations. FSIS has developed a draft compliance guideline document 
that includes these procedures. The draft guideline document can be 
found at: http://www.fsis.usda.gov/wps/portal/fsis/topics/regulatory-compliance/compliance-guides-index. An official plant would then need 
to validate that it is properly applying the FSIS time and temperature 
combinations provided in the guidance material and conduct monitoring 
and verification activities to demonstrate proper execution of the 
selected combinations.
    The pasteurization time and temperature compliance guidelines 
specifically will assist small and very small businesses in identifying 
validated procedures. The materials will be posted on the Agency's 
website.

F. Not Applying the Mark of Inspection Pending Test Results

    As discussed previously, egg products inspected at an official 
plant and found to be not adulterated must be pasteurized before they 
leave the official plant, except as otherwise permitted by the 
regulations of the Secretary. They must also bear the official 
inspection legend and official plant number of the plant where the 
products were processed.\13\
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    \13\ 9 CFR 411(c)(5) requires that containers of product bearing 
official identification display that identification and the plant 
number. Official identification means the official inspection mark 
or any other symbol prescribed by the regulations in part 590 to 
identify the status of any article. See 9 CFR 590.5.
---------------------------------------------------------------------------

    9 CFR 590.504(o) requires that egg products be pasteurized in 
accordance with the egg products inspection regulations before being 
released into consuming channels, while paragraph (o)(1) requires that 
they be sampled and tested for the presence of Salmonella to ensure 
that they were adequately pasteurized. 9 CFR 590.580 sets forth the 
specific testing requirements, and in this proposal, FSIS has rewritten 
this section for clarity.
    While FSIS does not require final product testing for Salmonella in 
RTE meat and poultry products, the Agency is continuing to require 
testing for Salmonella for RTE egg products by official plants. An egg 
products plant's Salmonella testing data continues to be important in 
monitoring process control.14 15 As part of its control 
verification effort, FSIS also will continue to collect and analyze 
samples from egg product processes for Salmonella and Lm.
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    \14\ The current Salmonella sampling levels that egg products 
plants must meet are provided in FSIS Directive 10,230.4, Salmonella 
Surveillance Program for Liquid and Frozen Egg Products.
    \15\ The USDA, FSIS Pasteurized Egg Products Lab (PEPRLab) 
Program is a program for laboratories performing Salmonella analysis 
on official surveillance samples of pasteurized egg products.
---------------------------------------------------------------------------

    While 9 CFR 590.504(o) states that egg products must be pasteurized 
before being released into consuming channels, 9 CFR 590.504(d) does 
permit inspection program personnel to allow egg products to be moved 
from an official plant before the plant receives laboratory results for 
Salmonella, or any other test results, if the plant retains control of 
the product. The plant must ensure that the product will be returned to 
the plant for reprocessing if the test results show that the product is 
positive for Salmonella.
    FSIS allows meat and poultry establishments to move product to 
locations other than the production facility prior to the receipt of 
FSIS test results so long as the establishment maintains control of the 
product. It also permits them to package and label products sampled and 
tested for adulterants with the mark of inspection pending negative 
test results, provided those products do not enter commerce, i.e., the 
products remain under the establishment's control until negative test 
results become available. The product does not, however, actually 
receive the mark of inspection until negative test results have been 
returned.
    The egg products regulations are the same. Egg products plants may 
move product pending test results only under circumstances that will 
ensure the return of the product to the plant for reprocessing, or 
under such other conditions as the Administrator may determine to 
ensure compliance with part 590. FSIS's practice of allowing egg 
products to be moved pending receipt of results of tests done by FSIS 
or the plant is codified in 9 CFR 590.504(d).
    Failure of an egg products plant to hold or maintain control of 
product pending Agency or plant test results endangers public health. 
Therefore, FSIS is proposing to revise paragraph (e) to 9 CFR 590.504 
to make clear that egg products plants that move product that has been 
sampled by the Agency or the plant before receiving test results must 
maintain control of the products represented by the sample pending the 
test results.
    The Agency is not requiring the use of any particular control 
measures to ensure that product is not used or distributed for sale 
before test results are known. Instead, egg products plants may 
continue to use, or develop, their own new, effective methods of 
control.

G. Irradiated Shell Eggs

    Shell eggs that are subjected to ionizing radiation may be used in 
the production of egg products because when applied at sufficient 
doses, irradiation can be a means of destroying disease-producing 
bacteria in food and result in a pasteurized product. Specifically, 
food irradiation is the process of exposing food to high levels of 
radiant energy. Forms of radiant energy include: Microwave and infrared 
radiation that heat food during cooking; visible light or ultraviolet 
light used to dry food or kill surface microorganisms; and ionizing 
radiation, resulting from cobalt-60, cesium-137, x-ray machines, or 
electron accelerators, that penetrates deeply into food, killing insect 
pests and microorganisms without significantly raising the temperature 
of the food. Food is most often irradiated commercially to extend shelf 
life, eliminate insect pests, or reduce pathogenic microorganisms. Food 
irradiation for these purposes is practiced in many countries, 
including the United States.
    Irradiation is subject to the food additive provisions of the 
FFDCA. FDA has the primary responsibility for determining whether food 
additives are safe for particular uses. FDA lists uses of food 
additives it has concluded are safe in 21 CFR parts 172 through 179. 
Under section 201(s) of the FFDCA (21 U.S.C. 321(s)), a source of 
radiation used to treat food is defined as a food additive. A source of 
radiation is used to process or treat food such that, analogous to 
other food processes, its use can affect the characteristics of the 
food.
    In a notice published in the Federal Register on March 20, 1998 (63 
FR 13675), FDA announced that a food additive petition (FAP 8M4584) had 
been filed by Edward S. Josephson, University of Rhode Island, Food 
Science and Nutrition Research Center, 530 Liberty Lane, West Kingston, 
RI 02892-1802, to amend the food additive

[[Page 6328]]

regulations to provide for the safe use of ionizing radiation for the 
reduction of Salmonella in fresh shell eggs.
    The petitioner submitted published articles and other study reports 
containing data and information related to eggs and other kinds of food 
in the areas of radiation chemistry, nutrition, toxicology, and 
microbiology. FDA considered the data and studies submitted in the 
petition, as well as other information in its files relevant to the 
safety and nutritional adequacy of eggs treated with ionizing 
radiation.
    Based on the totality of evidence from all evaluated data and 
studies, FDA determined that: (1) The proposed use of irradiation on 
fresh shell eggs at levels not to exceed 3.0 kGy is safe, (2) the 
irradiation can achieve its intended technical effect of reducing the 
numbers of Salmonella in fresh shell eggs, and, therefore, (3) it 
should amend 21 CFR 179.26 to provide for the use of irradiation on 
fresh shell eggs. Consequently, on July 21, 2000 (65 FR 45280), FDA 
approved the use of ionizing radiation on eggs in the shell to reduce 
the internal level of Salmonella. It also amended its regulations by 
expanding the list of products (21 CFR 179.26(b)) for which ionizing 
irradiation may be safely used to include fresh shell eggs. (While FDA 
does not define the word ``egg,'' FSIS has included the definition 
contained in the EPIA in 9 CFR 590.5.)
    While the irradiation of fresh shell eggs at the doses approved by 
FDA will reduce the level of microorganisms in shell eggs (65 FR 45281, 
July 21, 2000), the irradiation treatment of shell eggs to be processed 
as liquid egg product will not sufficiently eliminate pathogens of 
public health concern from this form of egg. As a result, treating 
shell eggs used to process egg products only with ionizing radiation 
will not result in a final egg product that is completely pasteurized, 
i.e., RTE. Because the irradiation treatment approved by FDA is 
insufficient to produce a ready-to-eat product based on the maximum 
approved irradiation dose specified in 21 CFR 179.26, it must be used 
in combination with other lethality treatments to complete the total 
lethality required to result in a pasteurized, RTE egg product.
    Under proposed 9 CFR 590.590, the irradiation treatment must 
precede the heat or other lethality treatment because FDA has not 
approved the use of irradiation on egg products. Irradiated shell eggs 
or the use of the irradiated contents of fresh shell eggs for inclusion 
in pasteurized egg products must be reflected in the ingredient 
statement on the finished product labeling (proposed 9 CFR 
590.410(a)(3)).

H. Implementation of Regulatory Requirements Domestic Plants

    All official plants will be subject to the requirements put forth 
in this proposal if it is adopted. FSIS intends to phase in the HACCP 
requirements in this proposal over a 2-year period after publication of 
a final rule, both as a means to reduce the impact for small and very 
small businesses and to ensure that FSIS inspection program personnel 
are properly trained and equipped with the tools to carry out the new 
requirements for inspection. FSIS intends to enforce the Sanitation SOP 
measures and the sanitation requirements one year after publication of 
a final rule because these regulations should involve less significant 
changes for the plants, and these regulations provide the plant 
increased flexibility.
    FSIS intends to enforce the requirement that egg products be 
processed to be edible without additional preparation to achieve food 
safety on the effective date of the rule. This requirement is 
consistent with current regulatory and statutory requirements; FSIS 
tests samples from all egg products for Salmonella and Lm. FSIS will 
continue to do so should this rule become final.
    Under this proposal, FSIS would no longer control design 
specifications for buildings and equipment. Instead, FSIS would focus 
its regulatory attention on determining whether an official plant is 
successfully meeting sanitation requirements. Should this rule become 
final, plants would be required to ensure that the design of buildings 
and equipment is appropriate for sanitary food production and for 
maintaining good sanitary conditions in accordance with broad 
sanitation principles. In addition, official plants adopting Sanitation 
SOPs of their own design would identify the elements of good sanitation 
required to prevent direct product contamination, carry out their 
Sanitation SOPs on a daily basis, and achieve acceptable sanitation 
results.
Foreign Plants
    Under 9 CFR 590.910, to export egg products to the United States, 
foreign countries will have to have a system of inspection that is 
equivalent to the system in the United States. Should this rule become 
final, as HACCP and other regulatory provisions are implemented in the 
American domestic market, foreign countries that export egg products to 
the United States would be evaluated to ascertain whether their 
inspection systems provide equivalent food safety protection, including 
adequate levels of enforcement.

I. Labeling and Other Consumer Protection Regulatory Requirements

    Official plants are responsible for ensuring that labeling used on 
egg products is truthful and not false or misleading (21 U.S.C. 1036). 
They are also responsible for ensuring that all labeling complies with 
the EPIA and the egg products inspection regulations. To ensure that 
official plants comply with applicable statutory and regulatory 
labeling requirements, FSIS conducts a prior approval program for 
labels used on federally-inspected egg products (9 CFR 590.411). 
Examples of label features that FSIS evaluates include the 
standardized, common or usual, or descriptive name of the product; an 
ingredients statement containing the common or usual name of each 
ingredient listed in descending order of predominance; and handling 
statements if the product is perishable.
    To obtain label approval, egg products plants must submit sketch 
labels to FSIS before they print the labels, containers, or packaging 
materials that bear official identification (9 CFR 590.411(a)). The 
information submitted is evaluated by the FSIS Labeling and Program 
Delivery Staff (LPDS) for conformance with the EPIA and the regulations 
adopted under it.
    Before July 1996, FSIS conducted a prior approval program for meat 
and poultry labels used on federally-inspected meat and poultry 
products. As with egg products, the meat and poultry prior approval 
program was intended to ensure that the labels applied to those 
products complied with the labeling and standards requirements of the 
Federal Meat Inspection Act, the Poultry Products Inspection Act, and 
their implementing regulations.
    Effective July 1, 1996, FSIS modified its prior label approval 
program for meat and poultry products by eliminating the need for 
submitting final labels to the Agency. The Agency changed the previous 
program by requiring the submission of only sketch labels (i.e., 
printer's proofs) and by expanding the types of labels that are 
generically approved and that could be applied to products in final 
form without first submitting such labels to the Agency for evaluation 
and approval (60 FR 67443, Dec. 29, 1995). FSIS took this action to 
improve the label approval system by eliminating the need for industry 
to re-submit sketches in final label form, thereby reducing the number 
of labels being submitted to the Agency for approval.

[[Page 6329]]

    On November 7, 2013, FSIS published a final rule that amended the 
meat and poultry products inspection regulations to expand the 
circumstances under which the labels of meat and poultry products would 
be deemed to be generically approved by the Agency. Effective January 
6, 2014, FSIS regulations only require four categories of meat and 
poultry product labels to be submitted to LPDS for approval, as 
described in 9 CFR 412.1. FSIS requires the submission of labels: (1) 
Intended for temporary approval; (2) for products produced under 
religious exemption; (3) for products for export with labeling 
deviations; and (4) with special statements and claims as described in 
Sec.  412.1(c). All labels that do not fit into one of the four 
categories are eligible for generic approval.
    As part of its effort to make the egg products inspection 
regulations as consistent as possible with the Agency's meat and 
poultry products regulations, FSIS is proposing to modify the prior 
label approval program for egg products labeling. If finalized, the 
program will be consistent with the prior label approval system that is 
in place for meat and poultry products, including the regulations that 
permit generically approved labeling. Under this system, only labeling 
that meets the criteria described in 9 CFR 412.1 will have to be 
submitted to FSIS for evaluation and approval.
    Therefore, FSIS is proposing to revise 9 CFR 590.411 to require all 
official plants, including those certified under a foreign inspection 
system in accordance with 9 CFR 590.910, to comply with the 
requirements contained in 9 CFR 412.1. As a result, egg products plants 
will have to submit only four categories of product labels to FSIS for 
approval, including labels: (1) Intended for temporary approval; (2) 
for products produced under religious exemption; (3) for products for 
export with labeling deviations; and (4) with special statements and 
claims as described in 9 CFR 412.1(c).
    In addition, FSIS is proposing to revise 9 CFR 590.412 to require 
that all official plants, including those certified under a foreign 
inspection system in accordance with Sec.  590.910, comply with the 
requirements in 9 CFR 412.2. Under this section, egg products plants 
would be authorized to use generically approved labels and thus would 
be free to use such labels without submitting them to the Agency for 
approval, provided the label displays all of the required mandatory 
features in a prominent manner and is not otherwise false or misleading 
in any particular.
    As with meat and poultry products, FSIS would select samples of 
generically approved labels from the records maintained by official 
plants and plants certified under foreign inspection systems to 
determine compliance with label requirements (9 CFR 412.2(a)(2)). If 
the Agency finds that an official plant is using a false or misleading 
label, it would institute the proceedings prescribed in 9 CFR 500.8 to 
revoke the approval for the label.
    Current 9 CFR 590.50 requires shell eggs that are packed into 
containers destined for the ultimate consumer to be labeled to state 
that refrigeration is required. However, on December 5, 2000, FDA 
amended 21 CFR part 101 to require that all shell eggs bear a safe 
handling statement. This statement, which is intended to inform 
consumers that there may be a risk associated with the consumption of 
eggs, and of the ways that they can properly handle and prepare eggs in 
order to reduce such risks, specifically instructs consumers to keep 
eggs refrigerated (21 CFR 101.17). As a result, FSIS's labeling 
requirement essentially duplicates FDA's, which became effective on 
September 4, 2001. Since it is FSIS's intention not to unnecessarily 
burden any parties with its regulatory requirements, FSIS is proposing 
to state in its regulations that shell eggs packed into containers 
destined for the ultimate consumer must be labeled in accordance with 
21 CFR 101.17(h).
    Meat and poultry products that require special handling to maintain 
their wholesome condition are required to bear handling statements. To 
ensure that the egg products inspection regulations will be as 
consistent as possible with the Agency's meat and poultry products 
regulations, FSIS is proposing a similar requirement for certain egg 
products, 9 CFR 590.410(a). Under this proposal, packaged egg products 
that require special handling to maintain their wholesome condition 
would have to bear the statement ``Keep Refrigerated,'' ``Keep 
Frozen,'' ``Perishable Keep Under Refrigeration,'' or a similar 
statement. This statement would have to be prominently displayed on the 
principal display panel. Similarly, egg products that are distributed 
frozen and thawed before or during display for sale at retail would 
have to bear the statement ``Keep Frozen'' on the shipping container. 
Consumer-sized containers for such egg products would have to bear the 
statement ``Previously Handled Frozen for Your Protection, Refreeze or 
Keep Refrigerated.''

J. Rules of Practice

    Under the EPIA, FSIS ensures that egg products are wholesome, not 
adulterated, and properly marked, labeled, and packaged. FSIS has broad 
authority to issue regulations to carry out the provisions of the EPIA, 
including the authority to prescribe terms and conditions under which 
inspection will be provided and maintained (21 U.S.C. 1035(b) and 
1043).
    Currently, when FSIS refuses to inaugurate inspection in a plant, 
seeks to withdraw inspection, or refuses to approve egg products 
markings, labels, or containers, the Agency initiates an administrative 
action under 9 CFR 590.160. FSIS is proposing to replace 9 CFR 
590.160(a)-(c) and (f)(1) with the supplemental rules of practice 
contained in 9 CFR part 500. These supplemental rules already apply to 
meat and poultry products establishments. Should this proposed rule 
become final, 9 CFR part 500, Rules of Practice, would apply to egg 
products plants, as an official establishment or establishment would 
include an official plant under proposed 9 CFR 591.1(b).
    FSIS is proposing to amend 9 CFR 500.2(c) to add 9 CFR 590.310 to 
the list of regulatory citations under which an establishment \16\ may 
appeal a regulatory control action. FSIS is also proposing to amend 9 
CFR 500.3(a)(7) to allow FSIS to take a withholding action or to impose 
a suspension without providing an establishment prior notification 
because the establishment did not destroy a condemned egg product that 
has been found to be adulterated and has not been reprocessed, in 
accordance with 9 CFR part 590, within three days of notification.
---------------------------------------------------------------------------

    \16\ For the purposes of Part 500, Rules of Practice, an 
official establishment or establishment includes an official plant. 
See proposed Sec.  591.1(b).
---------------------------------------------------------------------------

    FSIS is proposing to amend 9 CFR 500.5(a)(5) and (c) to add 9 CFR 
590.310 to the list of regulatory citations under which it must advise 
an establishment that it may appeal a withholding action or suspension, 
and under which an establishment may appeal a withholding action or 
suspension. FSIS is also proposing to amend 9 CFR 500.6 by adding 
section 18 of the EPIA (21 U.S.C. 1047) to the statutory citations 
under which the FSIS Administrator may file a complaint to withdraw a 
grant of Federal inspection because a recipient of inspection, or 
anyone responsibly connected to the recipient, is unfit to engage in 
any business requiring inspection.

[[Page 6330]]

    FSIS is proposing to amend paragraphs (a)(3) and (5) of 9 CFR 500.7 
to permit the FSIS Administrator to refuse to grant Federal inspection 
because an applicant has not demonstrated that adequate sanitary 
conditions exist in the establishment as required by the egg products 
inspection regulations, or because the applicant is unfit to engage in 
any business requiring inspection as specified in 21 U.S.C. 1047. FSIS 
is also proposing to amend 9 CFR 500.8(a) to allow FSIS to rescind or 
refuse approval of false or misleading marks, labels, or sizes or forms 
of any container for use with any egg product under sections 7 or 14 of 
the EPIA (21 U.S.C. 1036 and 1043). If this proposal is adopted, 9 CFR 
500.8(c) will provide for an opportunity for a hearing, in accordance 
with the Uniform Rules of Practice, 7 CFR subtitle A, part 1, subpart 
H, if FSIS rescinds or refuses approval of false or misleading marks, 
labels, or sizes or forms of any container for use with any egg 
product.
    Should this rule become final, FSIS would take a withholding action 
or impose a suspension without providing the plant prior notification 
because: (1) The official plant does not have a HACCP plan as specified 
in 9 CFR 417.2; (2) the official plant does not have Sanitation 
Standard Operating Procedures as specified in accordance with 9 CFR 
416.11 and 416.12; or (3) the official plant does not maintain sanitary 
conditions (9 CFR 500.3(a)). FSIS would also take these actions when 
facilities apply for a grant of inspection and the applicant or 
recipient, or anyone responsibly connected with the applicant or 
recipient, is unfit to engage in business because of prior criminal 
convictions, or when plant personnel assault, intimidate, or interfere 
with Federal inspection service (21 U.S.C. 1047).
    The proposed rules of practice will ensure that enforcement 
procedures are fair; identify situations that may lead FSIS to take 
enforcement action that may include refusing to apply or withholding 
the marks of inspection from product or suspending or withdrawing 
inspection from facilities; provide an opportunity for official plants 
to address and correct problems before the Agency files a formal 
administrative complaint to suspend or withdraw inspection; establish 
the procedures FSIS will follow in taking such actions; and consolidate 
the rules of practice applicable to official plants with those 
applicable to meat and poultry products establishments.

K. Other Regulatory Changes

1. Elimination of Official Egg Products Plant Equipment and Facility
Prior Approval Requirements
    The egg products inspection regulations require that official egg 
products plants applying for inspection submit to FSIS multiple sets of 
drawings of and specifications for the facilities for approval before 
inspection can be granted (Sec.  590.146). The regulations require 
plans to be submitted to the Agency for approval before any remodeling 
of facilities, and they require that prior approval by FSIS be obtained 
for equipment and utensils proposed for use in preparing edible product 
or product ingredients in official plants (Sec. Sec.  590.146(d), 
590.502, 590.504).
    The prior-approval process is a feature of the traditional 
``command-and-control'' regulatory approach. While prior approval 
provides assurance that equipment, facilities, and processes, as 
designed, meet certain requirements that are intended to ensure food 
safety or quality, it also reflects the emphasis of the current egg 
products inspection system on dictating the way in which official 
plants maintain sanitation and produce safe food. This feature of the 
current system is inconsistent with FSIS's view of the appropriate 
allocation of responsibility between the Agency and official plants. It 
is an obstacle and too often a deterrent to innovation by official 
plants seeking to improve operations, and it contributes to 
unproductive use of FSIS resources both in managing the approval system 
and policing official plants' compliance with approved facility and 
equipment specifications.
    Experience has shown that FSIS prior approvals are of limited value 
in ensuring good sanitation. They are limited in both scope, in that 
they deal only with official plant facilities as presented in drawings, 
and time, in that they are given once, on the condition that official 
plants will maintain a sanitary operating environment after their 
facilities are approved. Ultimately, an official plant's implementation 
of good Sanitation SOPs on a continuing basis is more critical than the 
actual design of a facility. Plant-operated sanitation procedures will 
achieve, without prior approval, the same objectives as the FSIS prior 
approvals, thereby rendering the prior approval procedures unnecessary. 
Thus, under HACCP-based inspection, the FSIS prior approvals could no 
longer be considered an efficient and cost-effective means to achieve 
sanitation objectives.
    Under this proposal, although there will no longer be a requirement 
for an official plant to submit facility drawings and specifications 
when applying for a grant of inspection, FSIS will continue to use a 
specific process to determine whether to grant inspection. This process 
will still include an on-site review, or ``walk-through,'' of the 
plant's facilities by FSIS inspection program personnel as part of the 
pre-decisional review of the facility's capability to produce complying 
product. However, the decision-making process will no longer include 
the review and prior approval of facility blueprints and specifications 
by the Agency. The on-site review will not involve matching items on 
the blueprints with the actual facilities represented. Instead, the 
focus of the review will be on the extent to which the facility is able 
to maintain a sanitary environment for food production and not impede 
government inspection.
    Prior approval by FSIS of equipment and utensils proposed for use 
in preparing edible egg products or product ingredients will also be 
eliminated under this proposal. FSIS's one-time approval does not 
address daily operational issues such as proper maintenance and 
adjustment of equipment to prevent product contamination. Such issues 
are covered by the requirement in 9 CFR 416.3 that equipment and 
utensils be of such material and construction that they can be 
thoroughly cleaned and sanitized, as well as by other general 
sanitation requirements.
    While facilities will be required to meet the general sanitation 
requirements prescribed in the regulations, they will have the 
flexibility to determine the specific steps to be taken to comply with 
those requirements. Facilities will be able to use equipment based on 
their own evaluation of their ability to utilize the equipment in a 
sanitary way.
    In its inspection activities, FSIS will verify that plant equipment 
meets those general standards. FSIS inspection program personnel will 
act if they find that the equipment that a facility is using creates an 
insanitary condition that may render product injurious to health.
2. Eggs and Egg Products Import Requirements
    FSIS is proposing to amend the regulations governing the 
importation and inspection of foreign eggs and egg products to align 
them more closely with the regulations governing the importation of 
foreign meat and poultry products. Historically, significant

[[Page 6331]]

differences have existed in how FSIS makes determinations of 
eligibility for the import of meat and poultry products to the United 
States as opposed to determinations for imported egg products. 
Similarly, requirements and procedures for the reinspection of imported 
products presented for entry into domestic commerce have been applied 
differently to meat and poultry products than to egg products. In this 
proposal, therefore, to improve import program efficiency and food 
safety controls, FSIS is seeking to harmonize the requirements and 
procedures applicable to imported eggs and egg products with those 
applicable to imported meat and poultry products.
    FSIS is proposing to amend 9 CFR part 590 by adding a new subpart 
B, Imports (9 CFR 590.900 et seq.), that will contain the imported egg 
products regulations. FSIS is proposing to amend these regulations by 
adding 9 CFR 590.900, which includes paragraphs that define certain 
basic terms, Import (Imported) and Offered for entry, and for product 
from eligible countries: Entry (Entered). FSIS is also proposing to add 
the term Official Import Inspection Establishment consistent with the 
definition in the meat inspection regulations.
    FSIS is proposing to add a new 9 CFR 590.901 to 9 CFR part 590 to 
establish the identity of inspected and passed imported egg products as 
domestic products. In so doing, the Agency seeks to ensure that 
imported egg products that bear the mark of inspection may be combined 
with inspected and passed domestic products for purposes of further 
processing or sale in domestic commerce.
    FSIS is proposing to amend 9 CFR 590.910 to establish the process 
and criteria that the Agency will follow to evaluate the equivalence of 
the inspection programs of foreign countries interested in gaining 
eligibility to export egg products to the United States. This section 
also delineates the manner in which foreign governments will be 
required to maintain the equivalence of their egg products inspection 
programs, including their certification of eligible establishments, 
separation of certified from uncertified establishments, and audits to 
verify the on-going equivalence of food safety and HACCP controls in 
certified establishments. FSIS is also proposing to prescribe the 
manner in which foreign governments are to certify eligible 
establishments to FSIS. Finally, proposed 9 CFR 590.910 includes 
provisions for the public notification of determinations of equivalence 
made by FSIS of foreign egg products inspection programs.
    FSIS is addressing those circumstances in which a shipment of 
imported egg products may be rejected for container defects, but are 
otherwise found to be acceptable, by proposing to add a new paragraph 
(d) to 9 CFR 590.945 to identify the conditions under which imported 
egg products consignments with damaged containers may be reoffered for 
inspection.
    For the handling of imported egg products, FSIS is proposing to 
amend 9 CFR 590.930 to require official import inspection 
establishments that re-inspect egg products to meet the sanitation 
requirements in 9 CFR part 416. The sanitation requirements in 9 CFR 
part 416 address conditions within establishments, such as facility and 
equipment sanitation, employee hygiene, and the development and 
implementation of sanitation standard operating procedures and 
associated recordkeeping requirements.
    FSIS is proposing to amend 9 CFR 590.940 to establish official 
inspection marks for imported egg products. Current regulations require 
only that egg products found to be acceptable for importation be 
properly labeled and bear the inspection mark of the country of origin. 
FSIS is proposing that imported egg products bear the same mark of 
inspection that is applied to imported meat and poultry products. 
Additionally, this section outlines a procedure for the pre-stamping of 
official marks of inspection on product containers prior to the 
completion of an inspection assignment. These changes are intended to 
help to facilitate the clearance of inspected product during the 
examination process when the product is not being held pending the 
receipt of laboratory test results.
    FSIS is proposing to amend 9 CFR 590.945 to clarify the procedures 
for the treatment and handling of imported egg products identified as 
``U.S. Refused Entry.'' Paragraph (a)(5) of that section states that if 
the owner or importer fails to take the required action within the time 
specified under paragraph (a)(4) of this section, the Department will 
take such actions as may be necessary to effectuate its order to have 
the product destroyed for human food purposes. The Department shall 
seek court costs and fees, storage, and proper expenses in the 
appropriate forum.
    FSIS is proposing to amend 9 CFR 590.955 to include shipping or 
identification marks among the list of required items for the labeling 
of imported egg products shipping containers. Shipping and 
identification marks are identifiers included on product container 
labels to distinguish product contained in a particular shipment from 
other product shipped elsewhere from the same production lot. Including 
shipping and identification marks on the shipping container labels 
facilitates identification of the product in the event of a recall or 
compliance investigation.
    9 CFR 590.956 permits the relabeling of all egg products eligible 
for importation with an approved label under the supervision of an FSIS 
inspector at an official egg products plant or other location. Under 
proposed 9 CFR 590.411(f)(1), if the Administrator has reason to 
believe that any labeling, including the size or form of any container 
in use or proposed for use, with respect to egg products is false or 
misleading in any way, the Administrator may direct that such use be 
withheld unless the labeling or container is modified so that it will 
not be false or misleading, or the formulation of the product is 
altered so that it is not adulterated or would not cause misbranding.
    While 9 CFR 590.956 permits the relabeling of all egg products 
eligible for importation with an approved label, proposed 9 CFR 
590.411(f)(1) would permit only those products whose containers, 
labels, or packaging materials are false or misleading to be modified 
so that the containers or labels are not adulterated or would not be 
misbranded. Therefore, FSIS is proposing to amend 9 CFR 590.956 to 
permit only those egg products that have been refused entry into the 
United States solely because of misbranding to be brought in compliance 
with the labeling requirements of 9 CFR chapter III. An authorized 
representative of the Secretary will have authority to supervise any 
such compliance activities.
    Under 9 CFR 590.965, egg products that have been inspected and 
marked by USDA may be returned from foreign countries. They are not 
considered importations within the meaning of 9 CFR part 590. Because 
such products are inspected and passed U.S. product, they are handled 
in the same manner as domestic products. FSIS is proposing to amend 9 
CFR 590.965 to permit the re-entry of inspected and passed egg products 
from foreign countries if they are not adulterated or misbranded at the 
time of such return. The product may be subject to reinspection in an 
official plant before it can be released into commerce. Such products 
would be exempted from further requirements under 9 CFR part 590, and 
returned shipments must be reported to the Administrator by letter 
prior to their arrival at the United States port of entry. The proposed 
language will be

[[Page 6332]]

consistent with that for returned United States inspected and marked 
poultry products (9 CFR 381.209).
    9 CFR 590.960 provides an exemption from foreign export 
certification and import inspection requirements for imported egg 
products that are intended for an importer's personal use, display, or 
laboratory analysis or that are not intended for sale or distribution 
in domestic commerce. FSIS is proposing to extend the 50 pound 
exemption for dried egg products to liquid or frozen egg products, 
which may currently not exceed 30 pounds in weight. This proposed 
change is consistent with the personal exemption provisions for 
imported meat and poultry products, which permit any product in a 
quantity of 50 pounds or less which was purchased by the importer 
outside of the United States for his/her own consumption to be imported 
into the United States from any country without compliance with the 
provisions of chapter III of title 9.
    On September 19, 2014, FSIS published a final rule amending 9 CFR 
590.915 and 590.920 to provide an electronic alternative to the paper-
based import inspection application and the foreign inspection and 
foreign plant certificate processes (79 FR 56220). It also removed from 
the regulations the discontinued ``streamlined'' import inspection 
procedures for Canadian product. The Agency is reproducing the amended 
regulatory text in the codified text of this rule for context and 
clarity. It is not, however, amending that text.
3. Changes to Defined Terms
    FSIS is proposing to amend the egg and egg products inspection 
regulations by updating the terminology used to refer to Agency 
personnel and the definitions of various terms. FSIS is proposing to 
remove the undesignated paragraphs of 9 CFR 590.5 that define Chief of 
the Grading Branch, Inspector/Grader, National Supervisor, Regional 
Director, and Service because such positions/entities do not exist 
within FSIS. As mentioned previously, FSIS assumed responsibility for 
conducting the egg products inspection program from AMS on May 28, 
1995. Therefore, 9 CFR part 590 references should refer to FSIS and its 
officials. FSIS is also proposing to remove the term Sanitize from 9 
CFR 590.5. As discussed earlier in this document, the Agency is 
proposing to consolidate the current sanitation regulations applicable 
to official plants into 9 CFR 590.1 and part 416. While not explicitly 
defined, the concept underlying the term ``sanitize'' is explained in 9 
CFR part 416. Therefore, to eliminate this difference between the meat 
and poultry inspection regulations and the egg and egg products 
inspection regulations, FSIS is proposing to remove the term Sanitize 
from 9 CFR 590.5.
    FSIS is also proposing to remove the definition for the term Eggs 
of current production. ``Eggs of current production'' are those eggs 
that have moved through the usual marketing channels since the time 
they were laid and are not in excess of 60 days old.\17\ AMS uses the 
concept of ``eggs of current production'' to maintain the integrity of 
its quality standards and the AMS grade shield. It is a quality, not a 
food safety, indicator. Therefore, FSIS is proposing to remove the term 
because continued application of the regulatory requirement may unduly 
restrict the availability of edible eggs. However, FSIS is requesting 
comments on whether it should keep the term ``eggs of current 
production,'' and any support that the term is still necessary.
---------------------------------------------------------------------------

    \17\ On April 19, 2006, AMS amended its definition of ``eggs of 
current production'' to mean shell eggs that are no more than 21 
days old (71 FR 20288).
---------------------------------------------------------------------------

    Finally, FSIS is proposing to remove the definition for the term 
``plant.'' Under this definition, the term ``plant'' can refer to an 
exempted plant, i.e., a plant where the Administrator has determined 
that the facilities and operating procedures meet the standards 
prescribed in part 590, and where the eggs received or used in the 
manufacture of egg products contain no more than restricted eggs than 
are allowed by the official standards of U.S. Consumer Grade B for 
shell eggs, and where an exemption has been granted, or an official 
plant, which means any plant in which the plant facilities, methods of 
operations, and sanitary procedures have been found suitable and 
adequate for the continuous inspection of egg products in accordance 
with part 590 and in which inspection service is carried on. FSIS is 
proposing to remove this definition because it is proposing to 
eliminate the exempted plant regulations, which is discussed later in 
this document. FSIS is proposing to add, in alphabetical order, an 
undesignated paragraph to 9 CFR 590.5 defining ``official plant.'' An 
``official plant'' will be any plant in which the plant facilities, 
methods of operation, and sanitary procedures have been found suitable 
and adequate by the Administrator for the inspection of egg products 
pursuant to the regulations in this part and in which inspection 
service is carried on.
    FSIS is proposing to revise the undesignated paragraphs of 9 CFR 
590.5 that define the terms Administrator, Egg, Egg product, 
Pasteurize, Processing, and Shell egg packer. FSIS is proposing to 
revise the definition for the term Administrator to make reference to 
the FSIS Administrator instead of the AMS Administrator. This change 
reflects the fact that the authority for inspecting egg products under 
the EPIA's food safety provisions was delegated by the Secretary of 
Agriculture to FSIS from AMS in November 1994.
    Because the term Dirty egg or Dirties is defined twice in 9 CFR 
590.5, once as an undesignated stand alone term and once as a 
definition under the term Egg (paragraph c)), FSIS is proposing to 
eliminate this redundancy by removing the undesignated stand-alone term 
and its definition of Dirty egg or Dirties. While the definition of 
Dirty egg or Dirties in paragraph (c) of the term Egg is properly 
located, FSIS is proposing to revise it. The definition includes 
prominent stains as a criterion for classifying an egg as ``dirty,'' 
but the EPIA's definition of the term does not include this criterion 
(21 U.S.C. 1033(g)(3)). In addition, rather than being called 
``dirties,'' dirty eggs are referred to as ``dirts'' in 7 CFR 59.720, 
which the Agency is proposing to add to the egg products inspection 
regulations. Consequently, FSIS is proposing to delete the words 
``prominent stains'' from the definition of Dirty egg or Dirties in the 
regulations.
    Also in 9 CFR 590.5, FSIS is proposing to replace the term Official 
standard with the term Official standards, correcting a typographical 
error made when the term was transferred from 7 CFR chapter 1, part 59 
to 9 CFR chapter III, part 590 on December 31, 1998 (63 FR 72352).
    FSIS is also proposing to amend the definition of Processing, to 
make clear that official plants may not repackage pasteurized dried egg 
products unless inspection program personnel are available to provide 
inspection oversight during the process. FSIS is proposing to amend the 
definition of Pasteurize to eliminate the requirement that only 
lethality treatments prescribed in the egg products inspection 
regulations may be used to destroy harmful viable microorganisms.
    FSIS is also proposing to amend the term Shell egg packer (grading 
station) by removing the phrase (grading station). Grading station is a 
term used by AMS to differentiate between the two primary types of egg 
handlers: (1) Producer-packers, who pack only their own production, and 
(2) grading stations, which are all other facilities that segregate and 
pack eggs. While FSIS also distinguishes between producer-packers and 
all other packing facilities

[[Page 6333]]

in its regulations, the phrase (grading station), when included as part 
of the defined term itself, causes confusion because FSIS does not 
perform any grading functions.
    FSIS is proposing to add to 9 CFR 590.5 an undesignated paragraph 
that defines Program employee because it is specific to FSIS and refers 
to Agency personnel. FSIS is also proposing to define the phrase 
Shipped for retail sale. Shipped for retail sale means eggs that are 
forwarded from the processing facility for distribution to the ultimate 
consumer.
4. Conditions for Receiving Inspection
    FSIS is proposing a 9 CFR 591.1(a) which, by cross-reference, will 
require that official plants, before receiving Federal inspection, 
develop written sanitation Standard Operating Procedures, in accordance 
with 9 CFR part 416, conduct a hazard analysis, and develop and 
implement a HACCP plan, in accord with 9 CFR part 417. Conditional 
inspection may be provided for a period not to exceed 90 days, during 
which period the plant will have to validate its HACCP plan.
5. Miscellaneous Changes
    FSIS is proposing to amend the following egg products inspection 
regulations to match the text in the meat and poultry products 
inspection regulations:

    9 CFR 590.118 Identification.
    9 CFR 590.120 Financial interest of inspectors.
    9 CFR 590.136 Accommodations and equipment to be furnished by 
facilities for use of program employees in performing service.
    9 CFR 590.146 Survey and grant of inspection.
    9 CFR 590.310 Appeal inspections.

    FSIS is also proposing to eliminate the issuance of appeal 
certificates (9 CFR 590.360) and the cost of an appeal to a plant (9 
CFR 590.370). Under current 9 CFR 590.300 and proposed 9 CFR 590.310, 
official plants have the right to appeal inspection decisions.
6. Reinterpreting the Requirement for Continuous Inspection in 21 
U.S.C. 1034(a)
    The EPIA requires the continuous inspection of the processing of 
egg products whenever processing operations are being conducted in each 
plant processing egg products for commerce (21 U.S.C. 1034(a)). FSIS 
has interpreted this to require the presence of inspection program 
personnel at each egg products plant whenever the manufacturing of egg 
products is being conducted, including breaking eggs or filtering, 
mixing, blending, pasteurizing, stabilizing, cooling, freezing, drying, 
or packaging egg products. This level of inspection coverage is similar 
to that required at meat and poultry slaughter establishments, where 
FSIS conducts inspection during all slaughter operations. In contrast, 
at meat and poultry processing establishments, FSIS conducts inspection 
at least once per shift.
    Based on the Agency's experience inspecting egg products plants 
since 1995, the Agency believes that egg products operations are more 
similar to meat and poultry processing operations, and especially those 
that produce ready-to eat products, than they are to meat and poultry 
slaughter operations, where inspection is required for each meat or 
poultry carcass. Like ready-to-eat meat and poultry processing 
operations, the typical egg products processing operation is a 
streamlined, automated process, with one or more lethality steps to 
destroy pathogens of concern in the finished product. As a result, FSIS 
is proposing to change the Agency's interpretation of ``continuous 
inspection'' in 21 U.S.C. 1034(a). Therefore, FSIS now intends to 
require inspection in egg products plants at least once per shift, 
instead of during all processing operations. FSIS welcomes comment on 
possible criteria the Agency might use in determining how inspection 
will be specifically adjusted in egg products plants.
    Section 590.100 provides exemptions from continuous inspection 
under certain circumstances, provided that the conditions for exemption 
and the provisions of the regulations are met. Paragraph (b) of 9 CFR 
590.100 provides an exemption from continuous inspection at any plant 
where the facilities, sanitation, and operating procedures are the same 
as required in part 590 for official plants and where the eggs received 
or used in the manufacture of egg products contain no more restricted 
eggs than are allowed by the official standards for U.S. Consumer Grade 
B shell eggs, and the egg products processed at such plant. Plants 
granted an exemption under 9 CFR 590.100(b) are called ``exempted 
plants.''
    Instead of continuous inspection, exempted plants are subject to 
periodic inspections, provided they have met the facility, operating 
procedures and practices, and sanitation standards required for 
official egg products plants as contained in 9 CFR 590.500-590.580. 
They are also subject to other provisions applicable to official 
plants, which includes maintaining records which must be made available 
to duly authorized representatives of the Administrator for review. 
Product from exempted plants may not bear official identification (9 
CFR 590.680(a)). Exempted product labels must bear the statement, 
``Exempted-E.P.I.A. Registration No. __.'' The registration number is 
that assigned to the exempted plant as provided in 9 CFR 590.650.
    The Agency's proposal to no longer require inspection coverage 
during all processing operations removes the need for this exemption. 
The circumstances provided by this exemption can be accommodated under 
FSIS's changed interpretation of ``continuous inspection'' in 21 U.S.C. 
1034(a) and would allow such exempted plants to bear official 
identification. Therefore, FSIS is proposing to remove the specific 
exemption from continuous inspection found in 9 CFR 590.100(b), as well 
as the regulations in 9 CFR 590.600-590.680 authorizing these types of 
exempted egg products plants. The other exemptions from inspection for 
certain types of egg products processing, provided at 9 CFR 590.100(e) 
and (g), would remain, but would be redesignated as paragraphs (b)(1) 
and (2). Paragraph (f), now reserved, would be removed.

III. Executive Orders 12866, 13563, and 13771 and the Regulatory 
Flexibility Act

    Executive Orders 12866 and 13563 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, or reducing costs, of harmonizing rules, and of promoting 
flexibility. This proposed 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 under Executive Order (E.O.) 12866.

A. Need for Regulatory Action

    The proposed rule will enable official plants to increase 
efficiency from complying with less burdensome regulations. FSIS is 
proposing that the current ``command and control'' egg products 
inspection regulations be changed to more flexible regulatory 
requirements. Under this proposed rule, egg products plants would be 
required to develop and maintain HACCP systems. A HACCP system allows 
greater flexibility for producers to

[[Page 6334]]

realize increased production efficiency. In addition, the proposed rule 
will allow plants to use different pasteurization methods. With 93 
percent of egg products plants already under a HACCP system,\18\ many 
have incurred additional unnecessary costs from complying with FSIS 
requirements in terms of ``command and control'' regulations and by 
processing under their own HACCP systems. By operating under the HACCP 
system alone, egg products plants can use plant resources in a more 
efficient manner while controlling for hazards in innovative ways in 
their HACCP plans.
---------------------------------------------------------------------------

    \18\ RTI International. 2014. ``Survey of Egg Packing and Egg 
Products Processing Plants.'' Revised Final Report. RTI Project no. 
0211740.015.001. 3040 Cornwallis Rd., P.O. Box 12194 Research 
Triangle Park, NC 27709-2194. OMB No. 0583-0162.
---------------------------------------------------------------------------

    Furthermore, regulatory action is warranted by the non-negligible 
public health risks associated with pasteurized egg products. The FSIS 
2005 risk assessment estimated 5,500 cases of Salmonella per year due 
to pasteurized liquid egg products. This represents 0.5% of the 
approximately 1.03 million annual domestically acquired foodborne 
illnesses caused by Salmonella estimated by Scallan et al. (2011, 
Emerging Infectious Diseases 17(1):7-15). Gurtler et al. (2013, 
Foodborne Pathogens and Disease, 10(6):492-499) identifies four 
Salmonella outbreaks during 2007-2012 that were possibly caused by 
contaminated pasteurized egg products. Also, process control failures 
in the production of pasteurized egg products have the potential for 
especially serious health outcomes because the Food Code recommends 
pasteurized egg products for highly susceptible populations (FDA 2013 
Food Code, Sec. 3-8).
Baseline of the Egg Products Industry
    Currently, egg products are produced under FSIS jurisdiction by 77 
egg products plants. Egg products include liquid, frozen, and dried 
whole eggs, whites, yolks, and various blends with or without non-egg 
ingredients. According to the FSIS Public Health Information System 
(PHIS) Database, we estimate that the egg products industry produced 
1.8 billion pounds of dried, frozen, and liquid egg products for 
distribution in commerce and produced 4 billion pounds of liquid 
unpasteurized product for further processing in 2014.\19\ Liquid egg 
products are produced in 73 percent of plants and accounted for 19 
percent of all egg products marketed as finished product in 2014.\20\ 
Liquid egg products represent the largest product type produced by egg 
products plants.
---------------------------------------------------------------------------

    \19\ In the Fiscal Year 2014, the monthly average production 
volume was used to calculate the annual estimate for 77 egg products 
plants in the PHIS database.
    \20\ In the Fiscal Year 2014, the monthly average production 
volume was used to calculate the percentage for 77 egg products 
plants in the PHIS database.
---------------------------------------------------------------------------

    A survey by RTI International in 2014, Egg Products Industry 
Survey,\21\ showed that 93 percent of egg products plants use a written 
HACCP plan to address at least one production step in their 
process.\22\ The remaining 7 percent would need to create HACCP plans 
under this proposed rule, as well as any of the 93 percent of egg 
products plants that have HACCP plans for some egg products, but not 
for others.
---------------------------------------------------------------------------

    \21\ RTI International. 2014. ``Survey of Egg Packing and Egg 
Products Processing Plants.'' Revised Final Report. RTI Project no. 
0211740.015.001. 3040 Cornwallis Rd., P.O. Box 12194 Research 
Triangle Park, NC 27709-2194.
    \22\ RTI International. 2014. ``Survey of Egg Packing and Egg 
Products Processing Plants.'' Revised Final Report. RTI Project no. 
0211740.015.001. 3040 Cornwallis Rd., P.O. Box 12194 Research 
Triangle Park, NC 27709-2194.
---------------------------------------------------------------------------

    This proposed rule would require that egg products plants maintain 
sanitation SOPs equivalent to the specifications of FSIS. Ninety-one 
percent of egg products plants already conduct sanitation procedures 
for food contact surfaces either daily or more frequently and document 
those procedures for sanitation standard operating procedures 
(Sanitation SOPs).\23\
---------------------------------------------------------------------------

    \23\ Ibid.
---------------------------------------------------------------------------

    Egg products production is easily the least labor-intensive process 
of the industries and products that FSIS regulates. Egg products plants 
tend to be highly mechanized and staffed with relatively low numbers of 
employees. Based on the results of a 2014 industry survey,\24\ no egg 
products plants employ enough employees to be categorized as HACCP size 
Large. Because of the high product volume output to low employee count 
that egg products plants enjoy, nearly all plants that have less than 
10 employees have over $2.5 million in annual sales, making them 
ineligible for the HACCP size Very Small category. Therefore, the large 
majority (98 percent) of egg products plants fall into the HACCP size 
Small category. In this section, FSIS discusses the size of individual 
plants. For a discussion of the size of egg products businesses under 
the Small Business Administration's (SBA) definition, see the initial 
Regulatory Flexibility Analysis section of this document.
---------------------------------------------------------------------------

    \24\ Under the HACCP size definitions, large establishments have 
500 or more employees and small establishments have fewer than 500 
but more than 10 employees. Very small establishments have fewer 
than 10 employees or annual sales of less than $2.5 million. These 
definitions are outlined in Pathogen Reduction: Hazard Analysis and 
Critical Control Point (HACCP) Systems (61 FR 38806 (July 25, 1996) 
available at: http://www.fsis.usda.gov/OPPDE/rdad/FRPubs/93-016F.pdf.
---------------------------------------------------------------------------

    Table 2 displays plants and processes.

                                                    Table 2--Egg Products Plants and Total Processes
--------------------------------------------------------------------------------------------------------------------------------------------------------
                             Plants                                     Breaking               Liquid                 Dried            Total processes
--------------------------------------------------------------------------------------------------------------------------------------------------------
77..............................................................                   56                    52                    17                   125
--------------------------------------------------------------------------------------------------------------------------------------------------------

    FSIS inspection of egg products plants includes 95 inspection 
program personnel (IPP), who conduct daily pre-operational sanitation 
inspections and monitor sanitary conditions of the plant premises, 
facilities, and equipment continually during operations at every egg 
products plant in multiple shifts. FSIS IPP are responsible for 
observing the cleanliness, type, and wholesomeness of raw materials and 
finished products, the handling of ingredients, pasteurization, 
packaging, labeling, freezing, storing, and all other operations 
related to the processing and production of egg products. In the past, 
FSIS has determined through regulation that, under the EPIA, IPP are 
required to conduct continuous inspection at egg products plants. This 
requirement means IPP must be on duty whenever eggs are broken; liquid 
eggs arrive at the receiving plant; egg products are blended, 
reconstituted, or reformulated; egg products are pasteurized or 
packaged; and non-denatured inedible egg products arrive at, or are 
shipped from, the plant.\25\
---------------------------------------------------------------------------

    \25\ U.S. Department of Agriculture, Egg Products Inspectors 
Handbook. AMS PY-Instruction No. 910. January, 1975.
---------------------------------------------------------------------------

Expected Cost of the Proposed Rule
    Presented here are economic analyses for the breaking of shell 
eggs, the production of pasteurized liquid egg

[[Page 6335]]

products (including frozen egg products), and the production of 
pasteurized dried egg products. Also provided are estimated government 
costs associated with this proposed regulation. All recurring and one-
time cost estimates are in 2016 dollars, and discount rates of 3 
percent and 7 percent are used to calculate annualized costs over a 10-
year period. For the purposes of the cost estimate, FSIS did not 
consider plant HACCP size because of the regularity in size explained 
previously (98 percent small). FSIS does not anticipate costs 
experienced by Very Small plants to differ greatly from those 
experienced by Small plants, because this proposed rule does not 
require any major capital, structural, or machinery investment or the 
hiring of additional employees, which can impose a large burden on Very 
Small plants.
    Egg products plant personnel compensation (wages and benefits) that 
plants would need to provide to their employees because of the proposed 
regulation is derived using Bureau of Labor Statistics Occupational 
Employment Statistics wage rates and National Compensation Survey 
benefits percentages. The wage rate for a Quality Control (QC) manager 
is estimated to be $51.47 per hour; for Supervisors or QC technicians, 
$34.26 per hour; and for Production workers, $13.00 per hour.\26\ 
Plants may pay employees for benefits such as paid leave, health 
insurance, and retirement and savings, and FSIS applied a benefits 
factor \27\ of two to the hourly wage rate to estimate a total 
compensation rate for a Quality Control (QC) manager at $102.94 per 
hour; and for Supervisors or QC technicians at $68.52 per hour; and for 
Production workers at $26.00 per hour.
---------------------------------------------------------------------------

    \26\ Estimates obtained from the Bureau of Labor Statistics May 
2016 National Industry-Specific Occupational Employment and Wage 
Estimates, for Management Occupations (Occupational Code 11-0000), 
https://www.bls.gov/oes/current/oes113051.htm#ind, Food Scientists 
and Technologists (19-1012), https://www.bls.gov/oes/current/oes191012.htm, and Production Occupations (51-0000) https://www.bls.gov/oes/current/oes513023.htm.
    \27\ This analysis accounts for fringe benefits and overhead by 
multiplying wages by a factor of two.
---------------------------------------------------------------------------

    Hazard Analysis & Critical Control Points (HACCP) Systems: The cost 
estimates for HACCP implementation include costs associated with plan 
development and reassessment, training, and monitoring and 
recordkeeping costs. If egg products plants follow current time/
temperature regulations, FSIS would accept their approach, and FSIS 
would not require that plants do a significant amount of analysis in 
their HACCP plan. Upon completion of the hazard analysis and 
development of the HACCP plans, plants are required to determine 
whether their HACCP plans are functioning as intended. During the 
initial validation period, plants are to test, repeatedly, the adequacy 
of the CCPs, critical limits, monitoring and recordkeeping procedures, 
and corrective actions identified in the HACCP plan.\28\ Plants are 
also required to perform an annual reassessment of their HACCP plans.
---------------------------------------------------------------------------

    \28\ 9 CFR 417.4.
---------------------------------------------------------------------------

    HACCP Plan Development and Reassessment: Egg products plants 
operate to produce a variety of products using a number of different 
processing techniques. Under this proposed rule, each plant would be 
required to evaluate its processes to determine the adequacy of 
existing written HACCP plans and the number of plans that would need to 
be created or modified to meet the requirements of the proposed rule. A 
large number of egg products plants already have HACCP plans for their 
processes. These plants will be required to validate and reassess their 
HACCP plans annually, to ensure that their HACCP plans are consistent 
with the regulations that FSIS is proposing in this document. For 
plants that currently lack HACCP plans, FSIS estimated the cost of 
initial plan development and validation and annual reassessment and 
validation. Under this proposed rule, every egg products plant would be 
required to reassess the adequacy of the HACCP plan at least annually 
and whenever any changes occur that could affect the hazard analysis or 
alter the HACCP plan. Such changes may include, but are not limited to, 
changes in raw materials, source of raw materials, or product 
formulation. For the purposes of estimating costs, FSIS simplified the 
production of egg products into three processes: the breaking of shell 
eggs, the production of pasteurized liquid egg products (including 
frozen egg products), and the production of pasteurized dried egg 
products.
    Using these three process definitions and data from PHIS, FSIS 
categorized plants by process. For reference, Table 2 above displays 
plants and processes. Using results from the 2014 Egg Products Industry 
Survey, FSIS applied a distribution, by process, of plants responding 
affirmatively to having a written HACCP plan to the population of egg 
products plants.\29\ Using this data, FSIS estimated the number of 
processes in those plants that require a HACCP plan to be developed. 
This information is displayed in Table 3.\30\
---------------------------------------------------------------------------

    \29\ See Appendix A, Section 4.
    \30\ For the purposes of the table, the number of processes was 
rounded to the nearest whole number. For the purposes of cost 
calculations and to be more exact, the Agency kept the actual 
figures, including digits past the decimal point, for instance, the 
number of total processes is actually 24.2507 rather than 24. These 
figures are not exact whole numbers because the Agency used the 
survey participant responses for which processes they use, as 
percentages of the total survey responses. These percentages were 
used to derive the total number of establishments that use each 
process applying that to the total population of egg products plants 
in Agency data (please see appendix A).

             Table 3--Processes Without Written HACCP Plans
------------------------------------------------------------------------
                                                                 Total
              Breaking                  Liquid       Dried     processes
------------------------------------------------------------------------
9...................................         12           3          24
------------------------------------------------------------------------

    For plan development and reassessment, FSIS used the Cost of Food 
Safety Investments \31\ final report, updated for inflation from 2014 
to 2016 dollars using the Consumer Price Index (CPI) for Urban 
Consumers, and, with the assumed benefits factor of two. FSIS estimates 
the costs for plan development and reassessment using the low estimate, 
(plan developed internally--low estimate--$17, 130), the high estimate 
(plan developed with consultant--high estimate--$42,423), and the 
average of the mid-estimates of the plan developed with a consultant 
and internally ($31,271).\32\ FSIS also incorporated an initial 
validation cost of $27,408 ($13,704-$41,112) and an ongoing (yearly) 
reassessment cost of $28,188 ($14,094-$42,282) for all HACCP plans. 
FSIS applied these estimates to the number of processes needing HACCP 
plans to determine the cost of HACCP plan development, validation, and 
reassessment, displayed in Table 4.
---------------------------------------------------------------------------

    \31\ RTI International. Cost of Food Safety Investments Final 
Report. Available at: https://www.fsis.usda.gov/wps/wcm/connect/0cdc568e-f6b1-45dc-88f1-45f343ed0bcd/Food-Safety-Costs.pdf?MOD=AJPERES. These cost figures were adjusted for 
inflation using the average CPI-U from 2014 to 2016.
    \32\ For plan development costs, in order to mitigate outliers, 
the Agency selected the greater of the two lowest costs between 
developing the plan internally and the cost for developing with a 
consultant for the low estimate, and the lesser of the two highest 
costs between developing the plan internally or with a consultant 
for the high estimate.

[[Page 6336]]



                                      Table 4--Estimated HACCP Plan Development, Validation, and Reassessment Costs
                                                                        [$1,000s]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                Annualized cost--3% (low      Annualized cost--7% (low
         Cost component            Initial cost (low estimate-  Recurring cost (low estimate- estimate-high estimate) over  estimate-high estimate) over
                                         high estimate)                high estimate)                      10                         10 years
--------------------------------------------------------------------------------------------------------------------------------------------------------
Development.....................          758.3 (415.4-1028.8)                             0             86.3 (47.3-117.1)            100.9 (55.3-136.9)
Initial Validation * for 25 New            667.4 (332.3-997.0)                             0             75.6 (37.8-113.5)             88.4 (44.2-132.7)
 Plans..........................
Annual Reassessment **..........      2,839.9 (1420.2-4,259.9)     3,523.5 (1,761.8-5,285.3)     3,445.7 (1,722.8-5,168.5)     3,432.5 (1,716.3-5,148.8)
--------------------------------------------------------------------------------------------------------------------------------------------------------
* These estimates are calculated using the actual number of unrounded processes or 24.2507 processes.
** ``Initially, plants with existing HACCP plans will begin reassessing in year 1. Plants without existing plans, after developing their plans in year
  1, will begin reassessing their plans in the following years.

    The above analysis does not include costs associated with taking a 
corrective action when routine monitoring of a CCP detects a deviation 
from an established critical limit. It is not possible to determine the 
costs of these corrective actions, but we expect that, for well-
designed processes with HACCP, these costs would occur infrequently.
    HACCP Training and Personnel: We assume that each egg products 
plant will employ a QC manager and a QC technician to ensure compliance 
with the proposed measures. Based on the 2014 Egg Products Industry 
Survey final report, approximately 7 percent of plants do not employ 
any HACCP plans.\33\ Thus, we assume 7 percent of plants (approximately 
five) will need to obtain training for a QC manager, assuming one per 
plant, and a QC technician and three production workers for each 
processing operation shift (an average of 1.7 shifts per plant based on 
the results of the Industry Survey).
---------------------------------------------------------------------------

    \33\ See Appendix A, Section 5.
---------------------------------------------------------------------------

    Although the HACCP system is different than the current system, 
FSIS believes that in egg products plants, only a portion of production 
employees, or a minimum number per shift, would actually receive 
training, given that the duties for most of the production employees 
will remain very similar or even the same when the plant operates under 
HACCP. FSIS is seeking comment on its assumed staffing and training 
cost estimates.
    FSIS used initial and recurring annual refresher training cost 
estimates (updated using the CPI for Urban Consumers from 2014 to 2016 
dollars and the assumed benefit factor of two) and the number of hours 
of training from the Cost of Food Safety Interventions \34\ final 
report updated with the assumed benefit factor of two. QC Managers 
would be trained initially at a cost of $3,991.29 (ranging from 
$1,995.65 to $5,986.94), with an annual refresher at a cost of $205.88 
($102.94 to $308.82). QC Technicians would be trained initially at a 
cost of $3,165 ($1,583 to $4,748), with an annual refresher at a cost 
of $137 ($69 to $206). An additional opportunity cost for training was 
added to account for the time lost when employees were in training at 
the per hour compensation rate (including wage and benefit factor) of 
the employees being trained for the length of the training and for 
replacement personnel to work covering the time of the training. 
Production employees would also need to be trained; however, FSIS 
assumed that this training would take place on the job, and therefore 
would only impose opportunity costs. We use an annual turnover rate of 
27.9 percent \35\ to estimate recurring costs due to employee 
separation and the need to train new employees. These estimates are 
displayed in Table 5.
---------------------------------------------------------------------------

    \34\ RTI International. Cost of Food Safety Investments Final 
Report. Available at: https://www.fsis.usda.gov/wps/wcm/connect/0cdc568e-f6b1-45dc-88f1-45f343ed0bcd/Food-Safety-Costs.pdf?MOD=AJPERES. These cost figures were adjusted for 
inflation using the average CPI-U from 2014 to 2016.
    \35\ Ibid.

                                                                              Table 5--HACCP-Related Training Costs
                                                                                            [$1000s]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                       Annualized cost--3% (low       Annualized cost--7% (low
                        Plants                             Shifts      Initial training costs (low   Recurring training costs (low   estimate-high estimate) over   estimate-high estimate) over
                                                                         estimate-high estimate)        estimate-high estimate)                10 years                       10 years
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
5.....................................................            9              78.9 (39.5-118.4)               27.9 (13.9-41.8)               33.7 (16.8-50.5)                 34.7 (17.3-52)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    HACCP Recordkeeping: The proposal requires facilities to record 
observations when monitoring CCPs and to document any deviations and 
corrective actions. The rule requires that an employee not involved in 
recording observations certify such records. Recordkeeping costs 
include the time it takes to make observations and to record the 
results of those observations, plus the cost of certifying and 
maintaining records. The level and extent of recordkeeping for the 
proposed rule should not change greatly for egg products plants already 
using HACCP plans. Plants with existing HACCP plans are already 
documenting CCPs, as well as documenting information for the current 
regulations. For these plants, there will be a cost savings and 
reduction in recordkeeping costs, because they are keeping records for 
both a HACCP system and the current regulations.
    FSIS used data from the 2014 Egg Products Industry Survey to 
estimate how many plants do not have HACCP plans, and the number of 
plans needed at these plants. FSIS also estimated the number of shifts 
at those plants.\36\ The cost of recordkeeping is dependent on several 
factors, each of which has to be documented in some manner, such as the 
number of HACCP plans developed by each plant, the number of shifts 
operated by each plant, the number of CCPs per HACCP plan, the number 
of pre-shipment reviews conducted, and any decision-making for hazard 
analysis that may require documentation.
---------------------------------------------------------------------------

    \36\ See Appendix A, Section 6.

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

[[Page 6337]]

    The numbers of CCPs in egg products plants likely vary considerably 
across the industry. An FSIS technical expert \37\ suggested four to 
six CCPs per HACCP plan, as an average. Therefore, we assumed that the 
average number of CCPs is five per egg products plant, per plan. We 
assumed 3 minutes (+/- 1 minute) for monitoring recordkeeping and 1 
minute (+/- 30 seconds) for certifying per CCP.\38\ FSIS is seeking 
comment on these time assumptions. From the above assumptions, we 
estimate (Table 6) the annual cost of HACCP recordkeeping and 
monitoring. The Agency seeks comment on the number of CCPs anticipated, 
taking into account the variables listed above.
---------------------------------------------------------------------------

    \37\ Curtis, P., North Carolina State University, Raleigh, NC. 
October 5, 2001. Personal communication with Catherine Viator, RTI. 
Reported in RTI International. 2002. ``Pathogen Reduction and Other 
Technological Changes in the Meat, Poultry, and Egg Industries.'' 
RTI Project no. 07182.017. 3040 Cornwallis Rd., P.O. Box 12194 
Research Triangle Park, NC 27709-2194
    \38\ FSIS estimated these approximate time estimates by first 
hand observation at egg products plants.

                                                                    Table 6--Annual HACCP Recordkeeping and Monitoring Costs
                                                                                            [$1000s]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Effective   Annualized--3% recordkeeping   Annualized--7% recordkeeping    Annualized--3% monitoring      Annualized--7% monitoring
                          Plans                             annual       costs (low estimate-high       costs (low estimate-high       costs (low estimate-high       costs (low estimate-high
                                                            shifts       estimate) over 10 years        estimate) over 10 years        estimate) over 10 years        estimate) over 10 years
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
24......................................................     10,509               68.3 (45.5-91.9)               68.3 (45.5-91.1)               60.0 (30.0-90.0)               60.0 (30.0-90.0)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    Table 7 presents a summary of the total HACCP-related costs as a 
result of the rule. These figures are annualized over 10 years at 3 
percent and 7 percent discount rates.

                                   Table 7--Total HACCP-Related Industry Costs
                                                   [$1000s] *
----------------------------------------------------------------------------------------------------------------
                                                        Annualized costs--3% (low     Annualized costs--7% (low
                   Cost component                     estimate-high estimate) over  estimate-high estimate) over
                                                                10 years                      10 years
----------------------------------------------------------------------------------------------------------------
Plan Development and Reassessment...................       3,607.7 (1808.0-5399.1)     3,621.9 (1,815.8-5,418.4)
Training............................................              33.7 (16.8-50.5)              34.7 (17.3-52.0)
Recordkeeping & Monitoring..........................            128.3 (75.5-181.1)            128.3 (75.5-181.1)
                                                     -----------------------------------------------------------
    Total...........................................     3,769.7 (1,900.3-5,630.7)     3,784.9 (1,908.6-5,651.5)
----------------------------------------------------------------------------------------------------------------
* Numbers in table may not sum to totals due to rounding.

Sanitation Standard Operating Procedures (Sanitation SOPs)
    Plan Development: For the most part, plants already have plans for 
sanitation insofar as FSIS already requires certain sanitation 
procedures. FSIS used responses from the 2014 Egg Products Industry 
Survey \39\, which describes the number of plants where they train 
their employees on sanitation SOPs, to estimate the percentage of 
plants that have sanitation SOPs. This accounts for approximately 91 
percent of all egg products plants. FSIS assumed that if a plant is 
training production employees, then it has a written plan in place that 
the training is based on and would likely meet the requirements of the 
proposed rule. FSIS then applied this percentage to determine the 
number of plants that would need to develop written sanitation SOPs 
(approximately 7). The current Sanitation SOP requirements for egg 
products plants will not change greatly, because the basis and 
standards for the sanitation of the plants will remain consistent with 
the current guidelines. For the proposed rule, the Sanitation SOPs will 
be created by the plant to meet FSIS standards under the HACCP system.
---------------------------------------------------------------------------

    \39\ See Appendix A, Section 1.
---------------------------------------------------------------------------

    FSIS used cost estimates from the Cost of Food Safety Interventions 
\40\ final report, with labor costs updated for inflation from 2014 to 
2016 dollars and for the benefit factor described previously. For plan 
development, FSIS estimated costs using the low estimate (plan 
developed internally--low estimate--$17,130), the high estimate (plan 
developed with a consultant--high estimate, $31,018), and the average 
of the mid-estimates of the plan developed internally and with a 
consultant ($27,469).\41\ The costs of Sanitation SOP plan development 
are displayed in Table 8.
---------------------------------------------------------------------------

    \40\ RTI International. Cost of Food Safety Investments Final 
Report. Available at: http://www.fsis.usda.gov/wps/wcm/connect/0cdc568e-f6b1-45dc-88f1-45f343ed0bcd/Food-Safety-Costs.pdf?MOD=AJPERES.
    \41\ For plan development costs, in order to mitigate outliers, 
the Agency selected the greater of the two lowest costs between 
developing the plan internally and the cost for developing with a 
consultant, and the lesser of the two highest costs between 
developing the plan internally or with a consultant.

                                            Table 8--Costs Associated With the Development of Sanitation SOPs
                                                                        [$1,000s]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                               Annualized cost--3% (low       Annualized cost--7% (low
       Cost component          Initial cost (low estimate-   Recurring cost (low estimate-   estimate-high estimate) over   estimate-high estimate) over
                                      high estimate)                 high estimate)                    10 years                       10 years
--------------------------------------------------------------------------------------------------------------------------------------------------------
Development.................           185.5 (115.7-209.5)                              0               21.1 (13.2-23.8)               24.7 (15.4-27.9)
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 6338]]

    Recordkeeping: Under the proposed rule, plants would be required to 
maintain daily records sufficient to document the implementation and 
monitoring of sanitation SOPs. FSIS used data from the 2014 Egg 
Products Industry Survey to estimate the proportion of plants keeping 
sanitation records that would meet the requirements of the proposed 
rule consisting of employee task performance and a log for deviations 
and corrective actions.\42\ FSIS then determined how many of those 
plants are completing recordkeeping tasks daily.\43\ Those plants that 
are not conducting recordkeeping or are conducting inadequate 
recordkeeping based on the proposed sanitation SOPs requirements will 
incur costs to do so.
---------------------------------------------------------------------------

    \42\ See Appendix A, Section 2.
    \43\ At least 1 pre-operational sanitation inspection of product 
contact zones per 9 CFR 416.13 and 416.12(c).
---------------------------------------------------------------------------

    For plants that are not keeping adequate sanitation records, FSIS 
estimated costs of recordkeeping based on the frequency of reported 
recordkeeping tasks. FSIS assumed that each sanitation recordkeeping 
task would be performed by a production employee and would take 
approximately 15 minutes (+/-5 minutes) to complete. A sanitation 
recordkeeping task would be performed daily, unless the plant reported 
performing a task more than daily, in which case FSIS assumed there 
would be one task per shift (an average of 1.7 shifts per plant based 
on the results of the Industry Survey). The average number of shifts 
was calculated using question 5.2 of the survey, which asks respondents 
their total number of production shifts per day.\44\ The responses by 
small and large plants to question 5.2 were combined along with the 
total responses to get percentages for average number of shifts. The 
calculation is 25% x 3 shifts + 18% x 2 shifts + 57% x 1 shift = 1.7 
shifts.
---------------------------------------------------------------------------

    \44\ Please see Appendix A.
---------------------------------------------------------------------------

    FSIS further assumed that a QC technician would review records for 
approximately 10 minutes (+/-5 minutes) once per day. FSIS used the 
recordkeeping estimates and time assumptions to estimate the cost to 
industry for Sanitation SOP recordkeeping, displayed in Table 9.

                                                       Table 9--Sanitation SOP Recordkeeping Costs
                                                                        [$1,000s]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                              Annualized--3% recordkeeping  Annualized--7% recordkeeping
              Current recordkeeping practices                Recordkeeping  Number of plants     cost (low estimate-high       cost (low estimate-high
                                                               frequency                         estimate) over 10 years       estimate) over 10 years
--------------------------------------------------------------------------------------------------------------------------------------------------------
In compliance with proposed rule..........................          Daily              * 17                             0                             0
Not in compliance with proposed rule......................          Daily                12              34.2 (22.8-45.7)              34.2 (22.8-45.7)
--------------------------------------------------------------------------------------------------------------------------------------------------------
* For number of plants, FSIS multiplies the percentages from the survey for each category by total number of plants (77). For the category >Daily, in
  compliance, the calculation of 77 x 22.8% yields 17.56. This count was rounded down to 17 plants to be consistent with the total number of plants in
  the analysis of 77.


                                                        Table 10--Sanitation SOP Monitoring Costs
                                                                        [$1,000s]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                Annualized--3% monitoring     Annualized--7% monitoring
              Current recordkeeping practices                Recordkeeping  Number of plants     cost (low estimate-high       cost (low estimate-high
                                                               frequency                         estimate) over 10 years       estimate) over 10 years
--------------------------------------------------------------------------------------------------------------------------------------------------------
In compliance with proposed rule..........................          Daily              * 17  ............................  ............................
Not in compliance with proposed rule......................          Daily                12              36.1 (18.0-54.1)              36.1 (18.0-54.1)
--------------------------------------------------------------------------------------------------------------------------------------------------------
* For number of plants, FSIS multiplies the percentages from the survey for each category by total number of plants (77). For the category >Daily, in
  compliance, the calculation of 77 x 22.8% yields 17.56. This count was rounded down to 17 plants to be consistent with the total number of plants in
  the analysis of 77.

    Training Costs: Egg products plants that are implementing new 
sanitation SOPs and those not in compliance will also need to conduct 
initial training for employees. Using data from the 2014 Egg Products 
Industry Survey, FSIS estimated the number of plants that will need to 
develop new sanitation SOPs (see Table 11) and the average number of 
shifts at those plants.\45\ FSIS assumed that one QC Manager per plant, 
and one QC Technician and three production employees per shift would be 
trained.\46\ FSIS is seeking comment on these assumptions. FSIS assumed 
the recurring training would occur for all 77 plants. FSIS used initial 
and recurring annual refresher training cost estimates from the Cost of 
Food Safety Interventions \47\ final report updated for inflation from 
2014 to 2016 dollars and with the assumed benefit factor of two. QC 
Managers would be trained initially at a cost of $2,756 ($1,378 to 
$4,134) with an annual refresher at a cost of $205.98 ($102.94 to 
$308.82). QC Technicians would be trained initially

[[Page 6339]]

at a cost of $2,342.97 (1,171.50 to 3,514.46) with an annual refresher 
at a cost of $137 ($68.52 to $205.56). FSIS added an additional 
opportunity cost to account for the lost hours when employees are in 
training. Production employees would also need to be trained, however, 
FSIS assumed that this training would take place on the job and 
therefore would impose only opportunity costs.
---------------------------------------------------------------------------

    \45\ See Appendix A, Section 3.
    \46\ An FSIS expert has also agreed with the Industry Survey and 
provided the likely staff needing training at a typical egg products 
plant.
    \47\ See Footnote 33.
---------------------------------------------------------------------------

    FSIS included recurring training costs to account for labor 
separation and the need to train new employees. To estimate these 
ongoing costs, FSIS used an annual labor turnover rate of 27.9 percent 
\48\ and applied that percentage to the initial training costs. The 
Sanitation SOP-related training costs due to the rule are displayed in 
Table 11.
---------------------------------------------------------------------------

    \48\ Annual total separations rate for nondurable goods, Bureau 
of Labor Statistics Job Openings and Labor Turnover Survey, 
available at: http://www.bls.gov/news.release/jolts.t16.htm.

                                                                 Table 11--One-Time and Recurring Sanitation SOP Training Costs
                                                                                            [$1000s]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                       Annualized cost--3% (low       Annualized cost--7% (low
                        Plants                             Shifts      Initial training costs (low   Recurring training costs (low   estimate-high estimate) over   estimate-high estimate) over
                                                                         estimate-high estimate)        estimate-high estimate)                10 years                       10 years
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
34....................................................           59            363.7 (214.7-545.6)             140.3 (79.3-225.2)            181.7 (103.8-287.3)            188.7 (107.9-297.8)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    Table 12 presents a summary of the total sanitation SOPs-related 
costs due to the rule annualized over 10 years at 3 percent and 7 
percent discount rates.

                             Table 12--Total Sanitation SOPs-Related Industry Costs
                                                   [$1000s] *
----------------------------------------------------------------------------------------------------------------
                                                        Annualized costs--3% (low     Annualized costs--7% (low
                   Cost component                     estimate-high estimate) over  estimate-high estimate) over
                                                                10 years                      10 years
----------------------------------------------------------------------------------------------------------------
Plan Development....................................              21.1 (13.2-23.8)              24.7 (15.4-27.9)
Recordkeeping & Monitoring..........................            171.0 (97.3-244.8)            171.0 (97.3-244.8)
Training............................................           181.7 (103.8-287.3)           188.7 (107.9-297.8)
                                                     -----------------------------------------------------------
    Total...........................................           373.9 (214.2-555.9)           384.5 (220.6-570.5)
----------------------------------------------------------------------------------------------------------------
* Numbers in table may not sum to totals due to rounding.

    Special Handling Statements on Labels: The proposed egg products 
rule requires ``Keep Refrigerated'' or ``Keep Frozen'' statements for 
all egg products that require special handling to maintain their 
wholesome condition. Plants currently include this information on egg 
products labels; therefore, this new requirement for the industry 
should not create additional costs.
    Costs from Requiring Egg Products Plants to Produce Egg Products 
That are Edible without Additional Preparation to Achieve Food Safety: 
The proposed rule requires that egg products plants process egg 
products that are edible without additional preparation to achieve food 
safety. FSIS does not anticipate that these plants will need to change 
their pasteurization practices to meet this requirement and therefore 
will not incur additional costs, except as a part of their normal 
operations in regards to complying with HACCP plan verification and 
monitoring activities. These verification and monitoring activities are 
discussed above as part of the HACCP costs of this proposed rule for 
recordkeeping and monitoring. FSIS has developed a Compliance Guideline 
for Small and Very Small Plants that produce ready-to-eat egg products. 
This guidance document is designed to help small and very small plants 
meet the proposed regulatory requirements by providing the best 
practice recommendations by FSIS, based on the best scientific and 
practical considerations. FSIS is seeking comment on this guidance 
document, which is posted on the Agency's web page: http://www.fsis.usda.gov/wps/portal/fsis/topics/regulatory-compliance/compliance-guides-index.
    Below, the total industry costs are presented:

                                         Table 13--Total Industry Costs
                                                   [$1,000] *
----------------------------------------------------------------------------------------------------------------
                                                        Annualized costs--3% (low     Annualized costs--7% (low
                   Cost component                        estimate-high estimate)       estimate-high estimate)
----------------------------------------------------------------------------------------------------------------
HACCP...............................................     3,769.7 (1,900.3-5,630.7)       3,784.9 (1908.6-5651.5)
Sanitation SOPs.....................................           373.9 (214.2-555.9)           384.5 (220.6-570.5)
                                                     -----------------------------------------------------------
    Total...........................................     4,143.6 (2,114.5-6,186.6)     4,169.4 (2,129.2-6,220.0)
----------------------------------------------------------------------------------------------------------------
* Numbers in table may not sum to totals due to rounding.

Agency Costs
    Training and Personnel: FSIS employs 95 egg products inspectors 
that exclusively inspect egg products plants. Some egg products plant 
inspectors already have HACCP training from past inspection experience 
in meat and poultry plants. For inspectors without prior experience, 
FSIS will need to train them in the HACCP system. The long-term 
objective of the Agency is to establish an inspection system where 
inspection program personnel would be equally qualified to conduct 
inspection

[[Page 6340]]

activities at meat or poultry establishments, and egg product plants.
    The Agency anticipates that it will need to train 51 egg products 
inspection personnel \49\ and 24 meat or poultry inspectors (non-egg 
products inspectors). Fifty-one of these inspectors will require a 4-
week training course on HACCP methods called Inspection Methods 
training, and 24 inspectors already trained in HACCP inspection will be 
trained in egg product inspection. The inspection methods training for 
egg products inspection personnel would be longer than for other plant 
personnel because it includes additional topics (e.g., processing and 
slaughter inspection in a HACCP environment, rules of practice, and 
fundamental food microbiology) that not all egg products plant 
personnel need to perform their job. The total costs (including travel, 
lodging, per diem, and training program) for the 4-week training 
program is approximately $6,000 \50\ per inspector, and the one-week 
egg product inspection training is approximately $1,200 per inspector. 
Therefore, the one-time Agency training costs total $334,800 (51 x 
$6,000) + (24 x $1,200).
---------------------------------------------------------------------------

    \49\ FSIS Policy Development Staff (PDS) provided the number of 
personnel that will need training. PDS estimated this number by 
contacting each district manager in the field where egg products 
plants are located.
    \50\ This figure is a mean estimate of training costs from FSIS/
OOEET Center for Learning.
---------------------------------------------------------------------------

    Replacement inspectors will be required during periods when egg 
products plant inspectors are being trained. The Agency's district 
offices estimate the cost of replacement inspectors to be $2,800 per 
person \51\ for inspection methods training and $700 per person for egg 
products inspection training. Consequently, the one-time cost of 
replacement inspectors is $159,600 derived from (51 x $2,800) and (24 x 
$700). Thus, the total one-time cost of training inspectors at egg 
products plants is $494,400. Table 14 provides the summary of the costs 
associated with inspector training.
---------------------------------------------------------------------------

    \51\ This is the average GSA per diem for meals and hotel 
multiplied by the number of days replacement inspectors would be 
needed to fill positions. http://www.gsa.gov/portal/content/104877.

        Table 14--Inspection Program Training Costs at 3% and 7% Discount Rates Annualized Over 10 Years*
                                                    [$1,000]
----------------------------------------------------------------------------------------------------------------
                                                                                    Annualized      Annualized
         Cost component            Number of IPP   Cost per IPP    One-time cost   cost--3% over   cost--7% over
                                                                                     10 years        10 years
----------------------------------------------------------------------------------------------------------------
Inspection Methods Training.....              51               6             306            34.8            40.7
Egg Products Inspection Training              24             1.2            28.8             3.3             3.8
Replacement IPP.................              75  ..............           159.6            18.2            21.2
                                 -------------------------------------------------------------------------------
    Total.......................  ..............  ..............           494.4            56.3            65.8
----------------------------------------------------------------------------------------------------------------
* Numbers in table may not sum to totals due to rounding.

    Total Costs: Table 15 provides a summary of the estimated total 
costs for the industry and Agency. The table includes annualized costs 
over 10 years at discount rates of 3 percent and 7 percent.

                                              Table 15--Total Costs
                                                   [$1,000] *
----------------------------------------------------------------------------------------------------------------
                                                        Annualized costs--3% (low     Annualized costs--7% (low
                     Total costs                      estimate-high estimate) over  estimate-high estimate) over
                                                                10 years                      10 years
----------------------------------------------------------------------------------------------------------------
Industry:
    HACCP...........................................     3,769.7 (1,900.3-5,630.7)     3,784.9 (1,908.6-5,651.5)
    Sanitation SOPs.................................           373.9 (214.2-555.9)           384.5 (220.6-570.5)
    Agency..........................................  ............................  ............................
IPP Training:                                                                 38.1                          44.5
    Replacement IPP.................................                          18.2                          21.2
                                                     -----------------------------------------------------------
        Total.......................................     4,199.9 (2,170.8-6,242.9)     4,235.2 (2,195.0-6,287.8)
----------------------------------------------------------------------------------------------------------------
* Numbers in table may not sum to totals due to rounding.

    The total annualized cost to the egg products industry of the 
proposal is $0.002 per pound of aggregate egg products ($4,143,600/1.8 
billion pounds) at the 3 percent discount rate. The cost of the 
proposed rule to the egg products industry is minimal, and we do not 
expect the costs from this rule to have impact on consumer prices.
Expected Benefits of the Proposed Rule
    The proposed rule will provide firms in the egg products industry 
greater flexibility and incentives for innovation. Firms derive 
benefits from opportunities to innovate and employ more flexible 
production methods over time.\52\ Many egg products plants have already 
adopted the HACCP system for egg product processing. One reason for 
this adoption is buyers of egg products (further egg processors or 
retailers) require the production of egg products to be done under the 
HACCP system. In addition, under a HACCP system, egg products plants 
can attain quality accreditations such as one by the Safe Quality Food 
Institute, which allows egg products plants to access different markets 
inaccessible to non-HACCP

[[Page 6341]]

processors. Academic literature (please see next section) has also 
shown that an egg products plant's choice to process under a HACCP 
system as a management tool can also be internally driven by efficiency 
gains.\53\
---------------------------------------------------------------------------

    \52\ Coglianese, Cary & David Lazer. 2003. ``Management-Based 
Regulation: Prescribing Private Management to Achieve Public 
Goals''. Law & Society Review 37.
    \53\ Kay Cao, Oswin Maurer, Frank Scrimgeour and Chris Drake. 
2004. ``The Economics of HACCP (Hazard Analysis & Critical Control 
Point): A Literature Review, Agribusiness Perspectives Papers'', 
Paper 64, ISSN 1442-6951.
---------------------------------------------------------------------------

    A number of studies in the last few decades have shown important 
efficiency gains for food production industries after moving into a 
HACCP system. In a study by Nganje and Mazzocco in 2003,\54\ individual 
plants in the red meat industry benefited from implementing HACCP by 
gaining efficiency in production. In a study by Henson et al. (2000) 
\55\ on HACCP adoption in the UK dairy industry, the authors also 
report similar benefits such as ``the reduction in wastage, increases 
in product shelf life, and decreases in production costs.'' \56\
---------------------------------------------------------------------------

    \54\ Nganje W.E. and Mazzocco M.A. 2003. ``The Impact of HACCP 
on Factor Demand and Output Supply Elasticities of Red Meat''. 
Journal of Agricultural and Resource Economics.
    \55\ Henson, S., Holt, G., and Northen, J. (2000). ``Costs and 
benefits of implementing HACCP in the UK dairy processing sector''. 
In L.J. Unnevehr (Ed.), The economics of HACCP: Costs and benefits 
(pp.347-363).
    \56\ Kay Cao, Oswin Maurer, Frank Scrimgeour, and Chris Drake, 
The Economics of HACCP (Hazard Analysis & Critical Control Point): A 
Literature Review, Agribusiness Perspectives Papers 2004, Paper 64, 
ISSN 1442-6951
---------------------------------------------------------------------------

    HACCP systems also enable firms that purchase egg products plant 
products to reduce costs of raw materials inspection, specification, 
and inventory.\57\ Given the efficiency gains in different food 
production facilities under FSIS jurisdiction by implementing HACCP, 
FSIS reasonably expects that the egg products industry will gain some 
efficiency from HACCP implementation.
---------------------------------------------------------------------------

    \57\ Kay Cao, Oswin Maurer, Frank Scrimgeour and Chris Drake, 
The Economics of HACCP (Hazard Analysis & Critical Control Point): A 
Literature Review, Agribusiness Perspectives Papers 2004, Paper 64, 
ISSN 1442-6951
---------------------------------------------------------------------------

    Benefits from removing current regulations: A large benefit from 
moving away from the current regulatory framework is the lessening of 
administrative burdens on plants and plant personnel. With the movement 
to a HACCP-based system, IPP will change how they inspect egg products 
plants by ensuring that plants' HACCP systems are functioning as 
intended rather than inspecting for compliance with current 
specifications. This change in how inspection is done will allow for 
improved allocation of resources to more food- safety tasks and 
sanitary verifications both for the Agency and for egg products plants. 
It also allows egg product plants to employ resources in a manner that 
more efficiently produces safe product instead of allocating resources 
just to comply with FSIS regulations. For instance, instead of sampling 
product for time and temperature, a plant can design a system in which 
its HACCP plan specifies sampling products at a more convenient time in 
the process, allowing for better personnel resource management to 
improve production efficiency.
    Another aspect of the reduced administrative burden is a reduced 
need for FSIS approval for changes to plant operations that deviate 
from current regulations. For example, official plants will no longer 
need to submit facility blueprints and specifications (plant changes) 
to the Agency when applying for a grant of inspection, nor will they 
need to obtain prior approval from FSIS for equipment and utensils 
proposed for use in preparing edible product or product ingredients. 
The approval process for a waiver to a regulation or for no objection 
to production changes will also be eliminated if this proposed rule is 
adopted. These changes provide cost savings to industry and the Agency 
and are quantified below. It takes industry on average 100 hours to 
make an industry submission as described above (waiver, plant 
blueprint, no objection, or equipment use), including additional 
correspondence with FSIS. The Agency spends an average of 69 hours to 
review and approve each submission. FSIS is seeking comment on its 
estimates of the time it takes industry to develop a submission and to 
respond to FSIS requests in connection with the submission.
    FSIS receives on average nine submissions per year from egg 
products plants. The submission process involves an egg products 
plant's QC technician providing the initial submission data and follow-
up correspondence with Agency personnel. This follow-up correspondence 
includes responding to FSIS questions with supporting data. The QC 
technician is paid an hourly wage of $68.52 per hour, which includes a 
benefit rate of two.\58\ An Agency reviewer would have a General 
Schedule 13 salary, step 3, at $94.20 per hour, which includes a 
benefit factor of two.\59\ Eliminating these two submission processes 
will save industry approximately $61,600 annually discounted over 10 
years at the 7 percent rate. The Agency would save approximately 
$58,498 annually discounted over 10 years at the 7 percent rate.
---------------------------------------------------------------------------

    \58\ Estimates obtained from the Bureau of Labor Statistics May 
2016 National Industry-Specific Occupational Employment and Wage 
Estimates, for Management Occupations (Occupational Code 11-0000), 
https://www.bls.gov/oes/current/oes113051.htm#ind, Food Scientists 
and Technologists (19-1012), https://www.bls.gov/oes/current/oes191012.htm, and Production Occupations (51-0000) https://www.bls.gov/oes/current/oes513023.htm.
    \59\ Hourly rate, Washington, DC, Office of Personel Management 
https://www.opm.gov/policy-data-oversight/pay-leave/salaries-wages/salary-tables/pdf/2016/DCB_h.pdf.

  Table 16--Industry and Agency Savings From the Elimination of Agency
            Approval for Plant And Product Processing Changes
                               [$1,000s] *
------------------------------------------------------------------------
                                            Annualized      Annualized
              Total savings                 savings--3%     savings--7%
                                           over 10 years   over 10 years
------------------------------------------------------------------------
Industry................................            61.6            61.6
Agency..................................            58.5            58.5
  Total.................................           120.1           120.1
------------------------------------------------------------------------
* Numbers in table may not sum to totals due to rounding.

    The HACCP plan provision of the proposed rule will also give plants 
flexibility to design their pasteurization and sampling procedures. 
Ninety three percent of egg products plants have indicated that their 
plants conduct microbiological testing in addition to those required by 
regulation.\60\ By giving plants the option to sample as determined in 
their HACCP plan, there may be a cost savings from sampling less. The 
proposed rule specifies that the final product must be produced to be 
edible without additional preparation to achieve food safety. This 
standard provides flexibility to an egg products plant by giving it the 
necessary end result of pathogen-free products without specifying 
direct instructions on the processing method. This allows plants to 
find the most efficient processing or sampling methods to best fit 
their own production process and resources to produce a pathogen-free 
product.
---------------------------------------------------------------------------

    \60\ RTI International. 2014. ``Survey of Egg Packing and Egg 
Products Processing Plants.'' Revised Final Report. RTI Project no. 
0211740.015.001. 3040 Cornwallis Rd., P.O. Box 12194 Research 
Triangle Park, NC 27709-2194.
---------------------------------------------------------------------------

    Additional Benefits from Generic Labeling: Additional benefits 
include cost reductions for the Agency and for the egg products plants 
that submit labels for changes to an existing label or for new label 
approvals. Currently, an egg products plant must submit a formal 
application along with a sketch of a product label to FSIS personnel 
for approval, regardless of the change (including a color or size 
change to a label). If the proposed rule is finalized,

[[Page 6342]]

the approval process for certain labels will be streamlined, allowing 
egg products plants to use certain labels without submitting an 
application to FSIS because the labels will be generically 
approvable.\61\ Labels that will not qualify for generic approval 
include temporary approvals, labels for export only that bear labeling 
deviations, or labels bearing special statements and claims. All other 
label types can be generically approved. Presently, many egg products 
plants use special claims on their labels (e.g., organic or free range) 
and so those labels would not qualify for generic approval. The Agency 
estimates that approximately 80 percent of labels have prior approval 
for these claims.\62\ If these prior approved producers make other 
changes to the labels not involving their pre-approved claims, they 
could qualify for generic labeling.
---------------------------------------------------------------------------

    \61\ As required by 9 CFR 412, the Labeling and Program Delivery 
Staff (LPDS) evaluates certain sketch applications and all temporary 
applications for meat and poultry products. All other meat and 
poultry product label applications may be generically approved 
without evaluation by LPDS.
    \62\ This was an approximation made by a label reviewer in the 
FSIS labeling group.
---------------------------------------------------------------------------

    The number of egg products labels submitted in 2015 was 
approximately 520, and in 2016, the number rose to 708 labels. FSIS 
estimates that approximately 50 percent of these new labels would 
qualify for generic label approval each year. Generic approval would 
reduce the recordkeeping burden at the plant and Agency by about half 
the current levels. In order to estimate cost savings through the 
generic labeling process, the number of future label submissions was 
estimated based on the annual historic increase in submissions. Using 
the industry cost savings of $25.00 per label from the prior label 
approval system: Generic Label Approval final rule,\63\ the proposed 
generic label approval process for egg products could save industry 
approximately $16,000 annually, discounted over 10 years at the 7 
percent rate, from not submitting labels. The Agency would save 
approximately $61,000 annually, given that on average the review 
process takes approximately one hour, and a reviewer would have a 
General Schedule 13 salary, step 3 with a benefit factor of two,\64\ 
having a total compensation of $94.20.
---------------------------------------------------------------------------

    \63\ 78 FR 66826.
    \64\ Estimates obtained from the Bureau of Labor Statistics May 
2016 National Industry-Specific Occupational Employment and Wage 
Estimates, for Management Occupations (Occupational Code 11-0000), 
https://www.bls.gov/oes/current/oes113051.htm#ind, Food Scientists 
and Technologists (19-1012), https://www.bls.gov/oes/current/oes191012.htm, and Production Occupations (51-0000) https://www.bls.gov/oes/current/oes513023.htm.

                 Table 17--Savings From Generic Labeling
                               [$1,000s] *
------------------------------------------------------------------------
                                            Annualized      Annualized
              Total savings                 savings--3%     savings--7%
                                           over 10 years   over 10 years
------------------------------------------------------------------------
Industry................................              16              16
Agency..................................            60.6            60.4
  Total.................................            76.7            76.4
------------------------------------------------------------------------
* Numbers in table may not sum to totals due to rounding.

    Better Agency Resource Coverage: Because all egg products plant 
inspectors will now be trained in HACCP and can staff FSIS-regulated 
establishments other than egg products plants, the Agency will 
experience an improvement in inspection coverage. In the egg products 
plants themselves, the Agency can also utilize HACCP trained inspectors 
as relief inspectors. Currently, egg products inspectors can only work 
in egg products plants.
    Change in Inspector Coverage: Under the proposed rule, FSIS 
inspectors would no longer provide inspection during all processing 
operations at each egg products plant, but instead may be provided once 
per shift. Therefore, under the proposal, inspectors may inspect 
several plants within a reasonable commuting distance (i.e., patrol 
assignments similar to meat and poultry processing inspection). The 
Agency expects there to be salary savings associated with patrol 
assignments through a 3-year change in staffing. The Agency expects to 
reduce the number of egg products inspectors by 10 inspectors in year 
1, 10 inspectors in year 2, and 10 inspectors in year 3, for a total 
reduction of 30 egg products inspectors through attrition and movement 
of inspectors to other positions in the Agency.
    In addition to Agency savings, there would be cost savings to 
industry because there would be a reduction in egg products inspector 
overtime and holiday hours, which industry pays for, due to patrol 
assignments.
    The Agency will incur costs for the additional travel inspectors 
will incur on patrol assignments, and the loss of overhead industry 
paid to the Agency for overtime and holiday hours worked. Agency travel 
costs include mileage increases for existing patrol assignments and GSA 
cars for new patrol assignments. Please see table 18 for a summary of 
total savings from the proposed changes in inspection coverage.

                       Table 18--Total Net Savings From Changes in Egg Products Inspection
                                                   [$1,000] *
----------------------------------------------------------------------------------------------------------------
                                                   Annualized estimate--3% over    Annualized estimate--7% over
                     Agency                                  10 years                        10 years
----------------------------------------------------------------------------------------------------------------
Costs:
    Changes in inspection coverage..............                           1,421                           1,421
Savings:
    Reduction in salaries due to changes in                              (2,046)                         (2,005)
     inspection coverage........................
                                                 ---------------------------------------------------------------
        Agency Net Budget Impact................                           (625)                           (548)
----------------------------------------------------------------------------------------------------------------
                                                    Industry
----------------------------------------------------------------------------------------------------------------
Savings:
    Elimination of inspection payments for                               (4,803)                         (4,803)
     overtime and holidays......................
                                                 ---------------------------------------------------------------
        Grand Total Net Savings.................                         (5,428)                         (5,388)
----------------------------------------------------------------------------------------------------------------
* Numbers in table may not sum to total due to rounding.


[[Page 6343]]

    In summary, the benefits from this proposed rule include 
improvements in product quality, lower transaction costs, plant 
innovation, and generally lower operational costs. Additionally, the 
egg products plants will not have to comply with the current ``command 
and control'' regulations. By eliminating regulations, administrative 
burdens will be lessened, including those associated with submitting 
documentation to FSIS for changes to the plant and plant processes, 
waivers, and most egg products labels, resulting in cost savings. 
Industry will also benefit from the reduction in overtime and holiday 
pay paid for the inspection of egg products plants. Table 19 summarizes 
the quantified costs and cost savings to industry and the Agency if the 
proposed rule is implemented. The rule provides a net cost savings of 
between $1.3 million and $1.4 million annualized over 10 years at the 7 
percent and 3 percent rates.

                                     Table 19--Total Costs and Net Benefits
                                                   [$1,000s] *
----------------------------------------------------------------------------------------------------------------
                                                    Annualized 3% mid estimate      Annualized 7% mid estimate
                      Costs                        (low estimate-high estimate)    (low estimate-high estimate)
                                                           over 10 years                   over 10 years
----------------------------------------------------------------------------------------------------------------
Industry:
    HACCP.......................................       3,769.7 (1,900.3-5,630.7)       3,784.9 (1,908.6-5,651.5)
    Sanitation SOPs.............................             373.9 (214.2-555.9)             384.5 (220.6-570.5)
Agency:
    IPP Training................................                            38.1                            44.5
    Replacement IPP.............................                            18.2                            21.2
                                                 ---------------------------------------------------------------
        Total Costs.............................    4,199.9 (2,170.8 to 6,242.9)    4,235.2 (2,195.0 to 6,287.8)
----------------------------------------------------------------------------------------------------------------
                                                     Savings
----------------------------------------------------------------------------------------------------------------
Industry:
    Reduced Plant Approval Processes............                           -61.6                           -61.6
    Generic Labeling............................                             -16                             -16
    Changes in inspection coverage..............                          -4,803                          -4,803
Agency:
    Reduced Plant Approval Processes............                           -58.5                           -58.5
    Generic Labeling............................                           -60.6                           -60.4
Changes in inspection coverage..................                            -625                            -585
                                                 ---------------------------------------------------------------
    Total Savings...............................                          -5,625                          -5,585
                                                 ---------------------------------------------------------------
        Grand Total Net Benefits Mid (low to         1,424.8 (-618.2 to 3,453.9)     1,349.5 (-703.1 to 3,389.7)
         high) savings minus costs..............
----------------------------------------------------------------------------------------------------------------
* Numbers in table may not sum to totals due to rounding.

    Uncertainty Surrounding Public Health Impacts: Currently, the 
regulations require specific times and temperatures for egg products 
pasteurization. If a plant wishes to employ an alternative time and 
temperature combination, the Agency reviews scientific research or data 
validating other methods of pasteurization (9 CFR 590.570(b)) and 
issues a ``No Objection'' letters (NOL) approving its use. The proposed 
rule will eliminate the codified time and temperature regulations and 
will require egg products plants to process egg products in a way that 
will ensure that the products are free of detectable pathogens. Due to 
a lack of data, FSIS is currently unable to compare food safety 
performance in egg products plants operating under the current 
regulations to those plants operating in a HACCP system under NOLs with 
differing pasteurization times and temperatures from those prescribed 
in the current regulations.
    Under HACCP, an egg products plant would be required to conduct a 
hazard analysis to identify and list the biological, chemical, or 
physical food safety hazards that are reasonably likely to occur in its 
production process for a particular product and the measures to 
prevent, eliminate, or reduce the occurrence of those hazards to an 
acceptable level. The plant would also be required to identify the 
points in each of its processes at which control is necessary to 
achieve this goal (9 CFR 417.2(c)(2)). These points are called 
``critical control points'' (CCPs). The plant would have to establish 
critical limits for the preventive measures associated with each 
identified CCP. Plants would also be required to validate that their 
process works as intended (9 CFR 417.4). The HACCP and Sanitation SOP 
framework will make FSIS inspection more efficient and effective, 
because the egg products plant would be required to prevent food safety 
problems rather than react to problems without preventing recurrence.
    FSIS has developed a Compliance Guideline for Small and Very Small 
Plants that produce ready-to-eat egg products. This document updates 
the current time and temperature regulations based on the best 
available scientific information.\65\ It provides ``safe harbors'' for 
egg products plants that FSIS considers as recognized procedures that 
can be employed without any further validation studies. However, the 
plant would need to validate that it is properly applying the FSIS time 
and temperature combinations provided in the guidance material and 
conduct monitoring and

[[Page 6344]]

verification activities in the plant's operating environment.
---------------------------------------------------------------------------

    \65\ Gurtler, J.B., Marks, H.M., Bailey, R.B, Juneja, V. and 
Jones, D.R. 2013. Kinetics Model Comparison for the inactivation of 
Salmonella Enteritidis and Oranienburg in 10% salted liquid whole 
egg. Foodborne Pathogens and Disease. 10:492-499.
    Gurtler, J.B., Marks, H.M., Jones, D.R, Bailey, R.B, and Bauer, 
N.E. 2011. Modeling the thermal inactivation kinetics of heat-
resistant Salmonella Enteritidis and Oranienburg in 10 percent 
salted liquid egg yolk. J. Food Prot. 74:882-892.
    Jordan, S.S., Gurtler, J.B., Marks, H.M., Jones, D.R. and Shaw, 
W.K. 2011. A mathematical model of inactivation kinetics for a four-
strain composite of Salmonella Enteritidis and Oranienburg in 
commercial liquid egg yolk. Food Micro. 28:67-75.
---------------------------------------------------------------------------

    FSIS will continue to test egg products for Salmonella and Lm. If 
FSIS detects pathogens in the product, plants that have identified the 
pathogen as reasonably likely to occur in the HACCP hazard analysis 
will be required to take corrective actions to ensure that they 
identify problems that led to production of contaminated product, 
ensure no adulterated product is in commerce, and take measures to 
prevent recurrence. Plants that have not identified the pathogen as 
reasonably likely to occur would need to take corrective actions and 
reassess their HACCP plans in accordance with 9 CFR 417.3(b). 
Currently, when FSIS detects positives in egg products plants, the 
Agency response is limited to preventing the product from which the 
sample was collected from entering commerce or requesting that the 
producer recall its products. FSIS inspectors currently repeatedly 
issue noncompliance reports at egg products plants with limited 
improvements in operations. Therefore, it is possible that the HACCP 
regulations will improve the operations of egg products plants.
Alternative Regulatory Approaches
    The Agency considered two alternatives designed to achieve the 
regulatory objective outlined in the Need for the Rule section. 
However, this proposed rule was chosen as the least burdensome, 
technically acceptable regulatory approach.
    Voluntary HACCP regulatory program: A voluntary HACCP system would 
be very close to the current system. In the current system, 93 percent 
of egg products plants already have implemented HACCP systems 
integrated into their processing. Because many plants have already 
changed to a HACCP system, the Agency does not foresee any non-HACCP 
operations voluntarily implementing HACCP that have not already done 
so. These plants would stay at status quo. Therefore, this regulatory 
option would not lead to a significant change in current egg products 
plants processing practices. However, there would be additional costs, 
such as inspector HACCP training and the costs of inspecting a dual 
system. Also, under the current regulations, continuous inspection 
prevents inspectors from working patrol assignments, which would save 
industry overtime costs and Agency resources. These savings would not 
be fully realized in a dual system. For the plants not operating under 
HACCP, there are possible consumer benefit losses as some plants may 
fail to innovate and might continue to comply with current regulation, 
passing production costs on to consumers. Therefore, FSIS rejected this 
alternative.
    HACCP for large volume egg products plants: In this alternative, 
only plants with a large production volume would be required to 
implement HACCP. This alternative would save Agency HACCP training 
costs for inspection personnel, who inspect small production plants. 
Small volume plants would be allowed to stay in a non-HACCP system, 
lowering industry costs. This alternative would need to have certain 
volume definitions to distinguish the type of plant considered in the 
alternative. A difficulty associated with the size definition process 
is that an egg products plant's volume may change depending on the 
season or from changes in its source eggs. These changes could affect 
the classification system, which is based on volume, and could create 
difficulties in identifying the plants most likely to be designated as 
large volume. Another drawback to this alternative is the possible 
costs to the small producer in the long run. Although the low-
production egg products plants may save initially on costs by not 
implementing HACCP, this alternative may hurt the plants' long-run 
efficiencies and competiveness because they would not be gaining the 
flexibility to innovate that they would by producing under the HACCP 
system.

              Table 20--Regulatory Alternatives Considered
------------------------------------------------------------------------
          Alternative                 Costs               Benefits
------------------------------------------------------------------------
(1) Existing Voluntary          Additional costs   No additional
 Recordkeeping.                  for the Agency.    benefits.
(2) HACCP only for large        In the long run,   Small volume
 volume egg products plants.     small plants       producers would save
                                 would incur more   on costs from not
                                 costs from the     having to change
                                 lack of            their production
                                 efficiency gains   process and develop
                                 associated with    the requisite
                                 HACCP.             Sanitation SOP and
                                                    HACCP plans. Large
                                                    volume producers
                                                    would acquire
                                                    benefits from
                                                    implementing HACCP.
(3) The Proposed Rule.........  ($1.34 million     Achievement of
                                 \66\) annual       regulatory objective
                                 cost savings to    of regulations
                                 industry and to    consistent with
                                 the Agency.        other FSIS
                                                    regulations, clear
                                                    responsibility of
                                                    Agency vs. industry,
                                                    and additional
                                                    flexibility for
                                                    industry.
------------------------------------------------------------------------

    Initial Regulatory Flexibility Analysis: The FSIS Administrator has 
made a preliminary determination that this proposed rule would not have 
a significant economic impact on a substantial number of small entities 
in the United States, as defined by the Regulatory Flexibility Act (5 
U.S.C. 601 et seq.).
---------------------------------------------------------------------------

    \66\ This cost is annualized at the 7 percent discount rate over 
10 years.
---------------------------------------------------------------------------

    There are 77 federally-inspected plants. We estimate that at least 
12 are large businesses or companies with multiple egg products 
plants.\67\ We estimate that approximately 46 plants are part of these 
larger companies, leaving 31 plants that could be considered small 
businesses. In the cost analysis above, FSIS estimated that the cost 
savings for the industry is approximately 733 thousand (7 percent, 10 
years).
---------------------------------------------------------------------------

    \67\ These figures differ from the number of plants in HACCP 
size categories for small and large as mentioned earlier in the 
document, because the sizes are derived from the HACCP size rather 
than a business size. In this section, FSIS does not need HACCP 
sizes for egg products plants for the Regulatory Flexibility 
Analysis. Instead, FSIS must analyze egg products company or firm 
sizes instead of an egg products establishment sizes. The HACCP size 
of an establishment alone is not enough to verify whether it's part 
of a larger business. To determine whether a business is small, FSIS 
analyzed whether egg products establishments were part of larger 
companies.
---------------------------------------------------------------------------

    This results in an average cost savings to a plant of ($9,200/
plant) annualized (7 percent, 10 years). The average revenue for egg 
products plants is approximately $104.4 million.\68\ Therefore, FSIS 
believes that the total cost savings to revenue ratio per plant is .01 
percent. FSIS is seeking public comment on its conclusion of no 
significant impact on small entities.

[[Page 6345]]

FSIS has developed a Compliance Guideline for Small and Very Small 
Plants that produce ready-to-eat egg products. This guidance document 
is designed to help small and very small plants meet the proposed 
regulatory requirements by providing the best practice recommendations 
by FSIS, based on the best scientific and practical considerations. 
FSIS is seeking comment on this guidance document, which is posted on 
the Agency's web page: http://www.fsis.usda.gov/wps/portal/fsis/topics/regulatory-compliance/compliance-guides-index.
---------------------------------------------------------------------------

    \68\ Derived from the RTI Industry Survey, Q.5.11, the weighted 
average of the midpoints of the respondents' answers to the level of 
annual revenue earned in the year prior to the survey. Q.5.11 What 
was the approximate value of egg product sales during the past year?
---------------------------------------------------------------------------

Appendix A to Executive Orders 12866 and 13563 and the Regulatory 
Flexibility Act Analysis \69\
---------------------------------------------------------------------------

    \69\ This Appendix describes how the Agency used the 2014 Egg 
Products Industry Survey conducted and published by RTI 
International to gather information on egg products plants relating 
to the cost section of this proposed rule. Specifically, this 
Appendix outlines how the survey questions were used to estimate the 
number of egg products plants that have Sanitation SOPs, HACCP 
plans, training, number of shifts, and record keeping.
    Section (1) describes egg products plants' use of Sanitation 
SOPs. Section (2) outlines the estimates for egg product plants' 
recordkeeping for Sanitation SOPs. Section (3) describes egg 
products plants' training for Sanitation SOPs. Section (4) describes 
the type of product produced by egg products plants and their use of 
HACCP plans. Section (5) describes the number of egg products plants 
with HACCP plans. Section (6) estimates the average number of shifts 
for egg products plants without HACCP plans.
---------------------------------------------------------------------------

    The 2014 Egg Products Industry Survey, conducted and published by 
RTI International, surveyed approximately 57 egg products plants with 
questions in regard to plants' use of HACCP plans, Sanitation SOPs, the 
number of plant personnel, hours of operation and the number of shifts, 
and current sampling practices. The survey design involved 
collaboration between FSIS personnel and RTI International. The full-
scale data collection took place over a 16-week period from February 
17, 2014, to June 9, 2014. The survey included 18 questions. The survey 
also provided information on production volume, types of product, and 
production processes. The survey was considered to be a census of the 
industry because all 77 egg products plants currently regulated by FSIS 
were contacted and asked to respond. The response rate to the survey 
was 72 percent. Fifty seven egg products plants completed the survey. 
Of these, 26 (46 percent) completed the survey via mail and 31 (54 
percent) completed the Web survey. FSIS used the survey results to 
supplement the information that FSIS maintains in the Public Health 
Information System. The responses to the survey were masked so that 
individual plants could not be identified, so FSIS applied response 
distributions to the larger population of egg products plants to 
approximate baseline industry characteristics. In order to describe the 
egg products plants, which are under FSIS's jurisdiction, brief 
discussions of the major findings of the survey have been placed 
throughout this Executive Order 12866 and 13563 discussion and the 
regulatory flexibility analysis and footnoted accordingly. Please find 
the link to the survey here: http://www.fsis.usda.gov/wps/wcm/connect/df3e0400-aaa7-423f-bb11-ff080fc8ce2b/Survey-Egg-Products-09302014.pdf?MOD=AJPERES.
Section 1 Sanitation SOPs
    FSIS estimated the percentage of plants that train production 
employees for Sanitation SOPs using question 4.5: During the past year, 
what types of food safety training did permanent employees of this 
plant receive? A plant was considered to train production employees if 
it responded affirmatively to choice b. Sanitation SOPs. 91.2 percent 
of respondents answered that employees receive Sanitation SOPs 
training.
Section 2 Recordkeeping for Sanitation SOPs
    FSIS estimated the percentage of plants that currently meet the 
proposed recordkeeping requirements using survey question 2.2: ``Which 
of the following records that are not required by FSIS does this plant 
maintain?'' A plant was considered to meet both if it answered 
affirmatively to choices 1--``Employee task performance log 
verification'' and 2--``Deviation and corrective action log.''
    FSIS then determined the frequency at which sanitation tasks are 
performed using question 2.6: ``How frequently does this plant conduct 
sanitation inspections of product contact zones?'' If a plant responded 
affirmatively to choice 1--``More than once per shift,'' it was 
considered to be conducting sanitation tasks at a frequency greater 
than daily. If it responded affirmatively to choice 2--``Once per shift 
before shift operations begin,'' and operates more than one shift daily 
(determined with question 5.2), then it was also considered to be 
conducting sanitation tasks at a frequency greater than daily. If it 
responded affirmatively to choice 2 and operates a single shift per 
day, or if it responded affirmatively to choice 3--``Once per day 
before daily operations begin,'' it was considered to be conducting 
sanitation tasks at a daily frequency. If it answered affirmatively to 
any other option, it was considered to conduct sanitation tasks less 
than daily.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                        Records in compliance                                                      Records not in compliance
--------------------------------------------------------------------------------------------------------------------------------------------------------
                               Daily           Daily
--------------------------------------------------------------------------------------------------------------------------------------------------------
8.8%...............................................................           33.3%            22.8%             3.5%            15.8%            15.8%
--------------------------------------------------------------------------------------------------------------------------------------------------------

Section 3 Training for Sanitation SOPs
    FSIS used the training estimates from Section 1 and assumed that 
any plant which did not provide training for Sanitation SOPs did not 
have a written plan. Then, FSIS estimated the number of shifts of 
employees needing training for Sanitation SOPs by averaging the 
reported number of shifts from question 5.2--``How many production 
shifts are operated each day at this plant?'' Only those plants that do 
not provide HACCP training were included in the average.

----------------------------------------------------------------------------------------------------------------
                                               No sanitation        Needed
                   Plants                      SOPs training   sanitation SOPs   Average sifts     Total shifts
----------------------------------------------------------------------------------------------------------------
77..........................................            8.8%                7              1.7                8
----------------------------------------------------------------------------------------------------------------


[[Page 6346]]

Section 4 Use of HACCP Plans
    To determine the percentage of plants which have written HACCP 
plans in place for their respective processes, FSIS used the survey to 
first determine which respondents produced products corresponding to 
the three main processes.
    For breaking, FSIS considered all plants that responded to question 
1.1: ``Which statement below describes how this plant receives egg 
inputs?'' and answered affirmatively to choice 1--This plant receives 
shell eggs only''--or to choice 2--This plant receives both shell eggs 
and liquid or dried eggs.''
    For dried eggs, FSIS considered all plants that responded to 
question 1.11: ``Does this plant produce this egg product form?'' and 
answered affirmatively to choice e--``Dried''--or to choice f--
``Blended and dried.''
    For liquid eggs, FSIS considered all plants that which responded to 
question 1.11: ``Does this plant produce this egg product form?'' and 
answered affirmatively to choice a--``Liquid''; to choice b--``Blended 
and liquid''; to choice c--``frozen''; to choice d--``Blended and 
frozen''; or g--``Extended shelf life liquid''.
    Next, for each process, FSIS determined if the respondent had a 
written HACCP plan using question 2.1: ``What production steps are used 
by this plant, and if used, is the step addressed in a written plan?'' 
Specifically, FSIS considered the plan acceptable if the plant 
responded affirmatively to option 3--``Used and Addressed in a Written 
HACCP Plan'' for option j--``Breaking shell eggs''; option m--``Drying 
egg products''; or option n--``Pasteurizing dried egg whites''; and 
option l--``Pasteurizing liquid eggs for breaking, dried, and liquid 
processes, respectively.''

------------------------------------------------------------------------
           Breaking w/ HACCP             Dried w/ HACCP  Liquid w/ HACCP
------------------------------------------------------------------------
84.6%.................................           80.0%            76.5%
------------------------------------------------------------------------

    Finally, FSIS applied these percentages to PHIS egg products plants 
production data (see Table below) to estimate the number of processes 
currently operating without HACCP plans.

----------------------------------------------------------------------------------------------------------------
                   Plants                         Breaking          Dried            Liquid      Total processes
----------------------------------------------------------------------------------------------------------------
77..........................................              56               17               52              125
----------------------------------------------------------------------------------------------------------------


----------------------------------------------------------------------------------------------------------------
                                                                                                 Total processes
                      Breaking w/o HACCP                       Dried w/o HACCP     Liquid w/o     operating w/o
                                                                                     HACCP            HACCP
----------------------------------------------------------------------------------------------------------------
9............................................................               3               12               24
----------------------------------------------------------------------------------------------------------------

Section 5 Plants With HACCP Plans
    FSIS used the results to question 2.1: ``What production steps are 
used by this plant, and if used, is the step addressed in a written 
plan?'' to determine the percentage of plants with no HACCP plans. 
Specifically, a plant was considered to have no HACCP plans if it did 
not respond with option 3--``Used and Addressed in a Written HACCP Plan 
for any of the following: j. Breaking shell eggs, l. Pasteurizing 
liquid eggs, m. Drying egg products, or n. Pasteurizing dried egg 
whites.''

------------------------------------------------------------------------
                                                        Number of plants
                 Percent with no HACCP                    (approximate)
                                                          with no HACCP
------------------------------------------------------------------------
7.%...................................................              5 *
------------------------------------------------------------------------
* The number of plants was rounded down.

Section 6 Shifts for Plants Without HACCP Plans
    To estimate the number of shifts at plants without any HACCP 
systems in place, FSIS averaged the responses to question 5.2: ``How 
many production shifts are operated each day at this plant?'' for those 
respondents determined to not have HACCP plans as described in Section 
5. This average (1.7 shifts) was then applied to the total number of 
plants estimated to be without HACCP systems.
Executive Order 13771
    This proposed rule, if finalized as proposed, is expected to be an 
E.O. 13771 deregulatory action. We have estimated that this proposed 
rule would yield cost savings. Assuming a 7 percent discount rate and a 
perpetual time horizon and a starting year of 2018, the proposed rule 
would yield approximately $1.29 million (2016$) in annualized cost 
savings. Assessment of the specific costs and cost savings may be found 
in the preceding economic analysis.

IV. Paperwork Reduction Act

    FSIS has reviewed the paperwork and recordkeeping requirements in 
this proposed rule in accordance with the Paperwork Reduction Act (44 
U.S.C. 3501, et seq.) and has determined that the paperwork 
requirements constitute new information collections.
    Title: Egg Products Hazard Analysis and Critical Control Point 
(HACCP) Systems and Sanitation Standard Operating Procedures (SOPs).
    Type of Collection: New.
    Abstract: Under this proposed rule, FSIS is requiring official 
plants to develop and maintain HACCP and Sanitation SOP records and 
plans, as well as various transaction records. The egg products 
industry's documentation of its processes, first in a plan and 
thereafter in a continuous record of process performance, will be a 
more effective food safety approach than the sporadic generating of 
information by inspection program personnel. This documentation gives 
inspection program personnel a much broader picture of production than 
they can generate and provides them additional time to perform higher 
priority tasks. At the same time, it gives plant managers a better view 
of their own process and more opportunity to adjust it to prevent 
safety defects.

Sanitation SOPs

    To meet the proposed regulation's sanitation requirements, each 
processor will develop and maintain a Sanitation SOP. The Sanitation 
SOP would specify the cleaning and sanitizing procedures for all 
equipment and facilities involved in the production of every product. 
As part of the Sanitation SOP, a plant employee will record results of 
daily sanitation checks at the frequencies stated in the Sanitation 
SOP.
    The burden of documenting the adherence to Sanitation SOPs is based 
on three factors: Recording, reviewing, and storage. Recording 
encompasses conducting and inscribing the finding

[[Page 6347]]

from an observation and filing of the document produced.

HACCP

    Under this proposal, the requirements for the implementation of 
HACCP in official plants will be the same as those being met by meat 
and poultry products establishments operating under HACCP. The plant 
will maintain on file the name and a brief resume of the HACCP-trained 
individuals who participate in the hazard analysis and subsequent 
development of the HACCP plans. Plants will develop written HACCP plans 
that include: Identification of hazards reasonably likely to occur in 
the production process; identification and description of the CCP for 
each identified hazard; specification of the critical limit which may 
not be exceeded at the CCP, and, if appropriate, a target limit; 
description of the monitoring procedure or device to be used; 
description of the corrective action to be taken if the limit is 
exceeded; description of the records which would be generated and 
maintained regarding this CCP; and description of the facility 
verification activities and the frequency at which they are to be 
conducted. Critical limits that are currently a part of FSIS 
regulations must be included. The adequacy of a plant's HACCP plan must 
be reassessed at least annually and whenever changes occur that could 
affect the hazard analysis or alter the HACCP plan.
    The HACCP records should be reviewed by a plant employee other than 
the one whom produced the record, before the product is distributed in 
commerce. If a HACCP-trained individual is on-site, that person should 
be the reviewer. The reviewer would sign the records. Lastly, HACCP 
records generated by the processor would be retained on site for at 
least 1 year.

Labeling

    Under this proposal, official plants will be authorized to use 
generically approved labels without specific evaluation by LPDS. In 
addition, frozen and refrigerated egg products will be required to bear 
labels that say, ``Keep Frozen'' or ``Keep Refrigerated.'' Plants 
already use special handling statements, when appropriate, under 
general Agency policy governing special handling statements. Therefore, 
the Agency has already accounted for the labeling paperwork burden.
    Estimate of Burden: FSIS estimates that each respondent will spend 
927.58 hours per year on this information collection.
    Respondents: Official egg products plants.
    Estimated Number of Respondents: 77.
    Estimated Number of Responses per Respondent: 927.58.
    Estimated Total Annual Burden on Respondents: 71,424 hours.
    Copies of this information collection assessment can be obtained 
from Gina Kouba, Paperwork Reduction Act Coordinator, Food Safety and 
Inspection Service, USDA, Room 6065-S, South Agriculture Building, 1400 
Independence Avenue SW, Washington, DC 20250; (202) 720-5627.
    Comments are invited on: (a) Whether the proposed collection of 
information is necessary for the proper performance of FSIS's 
functions, including whether the information will have practical 
utility; (b) the accuracy of FSIS's estimate of the burden of the 
proposed collection of information, including the validity of the 
methodology and assumptions used; (c) ways to enhance the quality, 
utility, and clarity of the information to be collected; ways to 
minimize the burden of the collection of information on those who are 
to respond, including through the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques, 
or other forms of information technology. Comments may be sent to both 
Gina Kouba, Paperwork Reduction Act Coordinator, at the address 
provided above, and the Desk Officer for Agriculture, Office of 
Information and Regulatory Affairs, Office of Management and Budget, 
Washington, DC 20253.
    All responses to this notice will be summarized and included in the 
request for OMB approval. All comments will also become a matter of 
public record.

V. Executive Order 12988

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. Under this rule: (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) no 
administrative proceedings will be required before parties may file 
suit in court challenging this rule.

VI. 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.

VII. Executive Order 13175

    This rule has been reviewed in accordance with the requirements of 
Executive Order 13175, ``Consultation and Coordination with Indian 
Tribal Governments.'' E.O. 13175 requires Federal agencies to consult 
and coordinate with tribes on a government-to-government basis on 
policies that have tribal implications, including regulations, 
legislative comments or proposed legislation, and other policy 
statements or actions that have substantial direct effects on one or 
more Indian tribes, on the relationship between the Federal Government 
and Indian tribes or on the distribution of power and responsibilities 
between the Federal Government and Indian tribes.
    FSIS has assessed the impact of this rule on Indian tribes and 
determined that this rule does not, to our knowledge, have tribal 
implications that require tribal consultation under E.O. 13175. If a 
Tribe requests consultation, the Food Safety and Inspection Service 
will work with the Office of Tribal Relations to ensure meaningful 
consultation is provided where changes, additions and modifications 
identified herein are not expressly mandated by Congress.

VIII. USDA Nondiscrimination Statement

    No agency, officer, or employee of the USDA shall, on the grounds 
of race, color, national origin, religion, sex, gender identity, sexual 
orientation, disability, age, marital status, family/parental status, 
income derived from a public assistance program, or political beliefs, 
exclude from participation in, deny the benefits of, or subject to 
discrimination any person in the United States under any program or 
activity conducted by the USDA.

How To File a Complaint of Discrimination

    To file a complaint of discrimination, complete the USDA Program 
Discrimination Complaint Form, which may be accessed online at http://www.ocio.usda.gov/sites/default/files/docs/2012/Complain_combined_6_8_12.pdf, or write a letter signed by you or your 
authorized representative.
    Send your completed complaint form or letter to USDA by mail, fax, 
or email:
    Mail: U.S. Department of Agriculture, Director, Office of 
Adjudication, 1400 Independence Avenue SW, Washington, DC 20250-9410. 
Fax: (202) 690-7442.

IX. Additional Public Notification

    Public awareness of all segments of rulemaking and policy 
development is important. Consequently, FSIS will

[[Page 6348]]

announce this Federal Register publication on-line through the FSIS web 
page located at: http://www.fsis.usda.gov/federal-register.
    FSIS also will make copies of this 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 our constituents and 
stakeholders. The Update is available on the FSIS web page. Through the 
web page, FSIS is able to provide information to a much broader, more 
diverse audience. In addition, FSIS offers an email 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/subscribe. Options range from recalls to export 
information, regulations, directives, and notices. Customers can add or 
delete subscriptions themselves, and have the option to password 
protect their accounts.

List of Subjects

9 CFR Part 416

    Meat inspection, Poultry and poultry products, Sanitation.

9 CFR Part 417

    Meat inspection, Poultry and poultry products, Record and 
recordkeeping requirements, Hazard Analysis and Critical Control Point 
(HACCP) Systems.

9 CFR Part 500

    Administrative practice and procedure, Meat inspection, Poultry and 
poultry products, Rules of practice.

9 CFR Part 590

    Eggs and egg products, Exports, Food grades and standards, Food 
labeling, Imports, Reporting and recordkeeping requirements.

    For the reasons set forth in the preamble, FSIS proposes to amend 9 
CFR chapter III as follows:

0
1. Revise the heading of subchapter E to read as follows:

SUBCHAPTER E--REGULATORY REQUIREMENTS UNDER THE FEDERAL MEAT INSPECTION 
ACT, THE POULTRY PRODUCTS INSPECTION ACT, AND THE EGG PRODUCTS 
INSPECTION ACT

PART 416--SANITATION

0
2. Revise the authority citation for part 416 to read as follows:

    Authority:  21 U.S.C. 451-470, 601-695, 1031-1056; 7 U.S.C. 450, 
1901-1906; 7 CFR 2.18, 2.53.

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

0
3. Revise the authority citation for part 417 to read as follows:

    Authority:  21 U.S.C. 451-470, 601-695, 1031-1056; 7 U.S.C. 450, 
1901-1906; 7 CFR 2.18, 2.53.

0
4. In Sec.  417.7, revise paragraph (b) to read as follows:


Sec.  417.7  Training.

* * * * *
    (b) The individual performing the functions listed in paragraph (a) 
of this section shall have successfully completed a course of 
instruction in the application of the seven HACCP principles to meat, 
poultry, or egg products, including a segment on the development of a 
HACCP plan for a specific product and on record review.

PART 500--RULES OF PRACTICE

0
5. Revise the authority citation for part 500 to read as follows:

    Authority:  21 U.S.C. 451-470, 601-695, 1031-1056; 7 U.S.C. 450, 
1901-1906; (33 U.S.C. 1251 et seq.); 7 CFR 2.18, 2.53.

0
6. Amend Sec.  500.2 by revising paragraph (c) to read as follows:


Sec.  500.2  Regulatory control action.

* * * * *
    (c) An establishment may appeal a regulatory control action, as 
provided in Sec. Sec.  306.5, 381.35, and 590.310 of this chapter.
0
7. Amend Sec.  500.3 by revising paragraphs (a)(1) and (a)(7) to read 
as follows:


Sec.  500.3  Withholding action or suspension without prior 
notification.

    (a) * * *
    (1) The establishment produced and shipped adulterated or 
misbranded product as defined in 21 U.S.C. 453, 21 U.S.C. 602, or 21 
U.S.C. 1033;
* * * * *
    (7) The establishment did not destroy a condemned meat or poultry 
carcass, or part or product thereof, or egg product, that has been 
found to be adulterated and that has not been reprocessed, in 
accordance with part 314 or part 381, subpart L, or part 590 of this 
chapter within three days of notification.
* * * * *
0
8. Amend Sec.  500.5 by revising paragraphs (a)(5) and (c) to read as 
follows:


Sec.  500.5  Notification, appeals, and actions held in abeyance.

    (a) * * *
    (5) Advise the establishment that it may appeal the action as 
provided in Sec. Sec.  306.5, 381.35, and 590.310 of this chapter.
* * * * *
    (c) An establishment may appeal the withholding action or 
suspension, as provided in Sec. Sec.  306.5, 381.35, and 590.310 of 
this chapter.
* * * * *
0
9. In Sec.  500.6:
0
a. Redesignate paragraphs (a) through (i) as paragraphs (a)(1) through 
(9).
0
b. Designate the introductory text as paragraph (a).
0
c. Revise newly redesignated paragraph (a)(9).
0
d. Add reserved paragraph (b).
    The revision and addition read as follows:


Sec.  500.6  Withdrawal of inspection.

    (a) * * *
    (9) A recipient of inspection or anyone responsibly connected to 
the recipient is unfit to engage in any business requiring inspection 
as specified in section 401 of the FMIA, section 18(a) of the PPIA, or 
section 18 of the EPIA.
    (b) [Reserved]
0
10. In Sec.  500.7, revise paragraphs (a)(3) and (5) to read as 
follows:


Sec.  500.7  Refusal to grant inspection.

    (a) * * *
    (3) Has not demonstrated that adequate sanitary conditions exist in 
the establishment as required by part 308, subpart H of part 381, part 
416, or part 590 of this chapter;
* * * * *
    (5) Is unfit to engage in any business requiring inspection as 
specified in section 401 of the FMIA, section 18(a) of the PPIA, or 
section 18 of the EPIA.
* * * * *
0
11. In Sec.  500.8, revise paragraphs (a) and (c) to read as follows:


Sec.  500.8  Procedures for rescinding or refusing approval of marks, 
labels, and containers.

    (a) FSIS may rescind or refuse approval of false or misleading 
marks, labels, or sizes or forms of any container for use with any 
meat, poultry, or egg product, under section 7 of the FMIA, under 
section 8 of the PPIA, or under sections 7 or 14 of the EPIA.
* * * * *
    (c) If FSIS rescinds or refuses approval of false or misleading 
marks, labels, or sizes or forms of any container for use with any 
meat, poultry, or egg product, an opportunity for a hearing will be 
provided in accordance with the Uniform Rules of Practice, 7 CFR 
subtitle A, part 1, subpart H.

[[Page 6349]]

PART 590--INSPECTION OF EGGS AND EGG PRODUCTS (EGG PRODUCTS 
INSPECTION ACT)

0
12. The authority citation for part 590 is revised to read as follows:

    Authority:  21 U.S.C. 1031-1056; 7 CFR 2.18, 2.53.


Sec.  Sec.  590.1 through 590.860   [Designated as Subpart A]

0
13. Designate Sec. Sec.  590.1 through 590.860 as subpart A and add a 
heading for subpart A to read as follows:

Subpart A--GENERAL

0
14. Amend Sec.  590.5 by:
0
a. Revising the definition of Administrator.
0
b. Removing the definition of Chief of the Grading Branch and Dirty egg 
or Dirties.
0
c. Revising paragraph (c) of the definition of Egg and the definition 
of Egg product.
0
d. Removing the definition of Eggs of current production, Inspector/
Grader, and National Supervisor.
0
e. Adding, in alphabetical order, the definition of Official plant.
0
f. Removing the definition of Official Standard.
0
g. Adding, in alphabetical order, the definition of Official standards.
0
h. Revising the definition of Pasteurize.
0
i. Removing the definition of Plant.
0
j. Revising the definition of Processing.
0
k. Adding, in alphabetical order, the definition of Program employee.
0
l. Removing the definitions of Regional Director, Sanitize, and 
Service.
0
m. Revising the definition of Shell egg packer.
0
n. Adding, in alphabetical order, the definition of Shipped for retail 
sale.
    The revisions and additions read as follows:


Sec.  590.5  Terms defined.

* * * * *
    Administrator means the Administrator of the Food Safety and 
Inspection Service or any officer or employee of the Department of 
Agriculture to whom authority has been delegated or may be delegated to 
act in his or her stead.
* * * * *
    Egg * * *
    (c) Dirty egg or Dirt means an egg that has a shell that is 
unbroken and has adhering dirt or foreign material.
* * * * *
    Egg product means any dried, frozen, or liquid eggs, with or 
without added ingredients, excepting products which contain eggs only 
in a relatively small proportion or historically have not been, in the 
judgment of the Secretary, considered by consumers as products of the 
egg food industry, and which may be exempted by the Secretary under 
such conditions as the Secretary may prescribe to assure that the egg 
ingredients are not adulterated and such products are not represented 
as egg products. For the purposes of this part, the following products, 
among others, are exempted as not being egg products: Cooked egg 
products, imitation egg products, dietary foods, dried no-bake custard 
mixes, egg nog mixes, acidic dressings, noodles, milk and egg dip, cake 
mixes, French toast, and sandwiches containing no more restricted eggs 
than are allowed in the official standards for U.S. Consumer Grade B 
shell eggs. Balut and other similar ethnic delicacies are also exempted 
from inspection under this part.
* * * * *
    Official plant means any plant in which the plant facilities, 
methods of operation, and sanitary procedures have been found suitable 
and adequate by the Administrator for the inspection of egg products 
pursuant to the regulations in this part and in which inspection 
service is carried on.
    Official standards means the standards of quality, grades, and 
weight classes for eggs.
* * * * *
    Pasteurize means the subjecting of each particle of egg products to 
heat or other treatments to destroy harmful viable microorganisms.
* * * * *
    Processing means manufacturing of egg products, including breaking 
eggs or filtering, mixing, blending, pasteurizing, stabilizing, 
cooling, freezing or drying, or packaging or repackaging egg products 
at official plants.
* * * * *
    Program employee means any inspector or other individual employed 
by the Department or any cooperating agency who is authorized by the 
Secretary to do any work or perform any duty in connection with the 
Program.
* * * * *
    Shell egg packer means any person engaged in the sorting of shell 
eggs from sources other than or in addition to the person's own 
production into their various qualities, either mechanically or by 
other means.
    Shipped for retail sale means eggs that are forwarded from the 
processing facility for distribution to the ultimate consumer.
* * * * *
0
15. Amend Sec.  590.10 by revising the third sentence to read as 
follows:


Sec.  590.10  Authority.

    * * * The Food Safety and Inspection Service and its officers and 
employees will not be liable in damages through acts of commission or 
omission in the administration of this part.


Sec.  Sec.  590.17 and 590.22   [Removed]

0
16. Remove Sec. Sec.  590.17 and 590.22.
0
17. Revise Sec.  590.28 to read as follows:


Sec.  590.28  Other inspections.

    Inspection program personnel will make periodic inspections of 
business premises, facilities, inventories, operations, transport 
vehicles, and records of egg handlers, and the records of all persons 
engaged in the business of transporting, shipping, or receiving any 
eggs or egg products.
* * * * *
0
18. Revise Sec.  590.40 to read as follows:


Sec.  590.40  Egg products not intended for human food.

    Periodic inspections will be made at any plant processing egg 
products which are not intended for use as human food of its operations 
and records to ensure compliance with the Act and the regulations in 
this part. Egg products not intended for use as human food shall be 
denatured or decharacterized prior to being offered for sale or 
transportation unless shipped under seal as authorized in Sec.  
590.504(c) and identified as prescribed by the regulations in this part 
to prevent their use as human food.
0
19. Revise Sec.  590.50 to read as follows:


Sec.  590.50  Egg temperature and labeling requirements.

    (a) All shell eggs packed into containers destined for the ultimate 
consumer must be stored and transported under refrigeration at an 
ambient temperature of no greater than 45[deg] F (7.2[deg] C) and must 
bear a safe handling label in accordance with 21 CFR 101.17(h).
    (b) Any producer-packer with an annual egg production from a flock 
of 3,000 or fewer hens is exempt from the temperature and labeling 
requirements of this section.
0
20. Revise Sec.  590.100 to read as follows:


Sec.  590.100  Specific exemptions.

    (a) [Reserved]
    (b) The following are exempt, to the extent prescribed, from the 
continuous inspection of egg products processing operations in section 
5(a) of the Act (21 U.S.C. 1034(a)), provided the conditions

[[Page 6350]]

for exemption and the provisions of these regulations are met:
    (1) The processing and sale of egg products by any poultry producer 
from eggs of his own flock's production when sold directly to a 
household consumer exclusively for use by the consumer and members of 
the household and its nonpaying guests and employees.
    (2) The processing in non-official plants, including but not 
limited to bakeries, restaurants, and other food processors, of certain 
categories of food products which contain eggs or egg products as an 
ingredient, as well as the sale and possession of such products. Such 
products must be manufactured from inspected egg products processed in 
accordance with the regulations in this part and 9 CFR part 591 or from 
eggs containing no more restricted eggs than are allowed in the 
official standards for U.S. Consumer Grade B shell eggs.


Sec.  590.105  [Removed]

0
21. Remove Sec.  590.105 and undesignated center heading ``Performance 
of Service''.


Sec.  Sec.  590.112, 590.114 and 590.116   [Removed]

0
22. Remove Sec. Sec.  590.112, 590.114 and 590.116.
0
23. Add an undesignated center heading above Sec.  590.118 and revise 
Sec.  590.118 to read as follows:

Performance of Service


Sec.  590.118  Identification.

    Each program employee will be furnished with a numbered official 
badge that will be carried in a proper manner at all times while on 
duty. This badge will be sufficient identification to entitle the 
program employee entry at all regular entrances and to all parts of the 
official plant and premises to which the program employee is assigned.


Sec.  590.119  [Removed]

0
24. Remove Sec.  590.119.
0
25. Revise Sec.  590.120 to read as follows:


Sec.  590.120  Financial interest of inspectors.

    (a) No program employee will inspect any product in which the 
employee, the employee's spouse, minor child, partner, organization in 
which the employee is serving as officer, director, trustee, partner, 
or employee, or any other person with whom the program employee is 
negotiating or has any arrangements concerning prospective employment, 
has a financial interest in the product.
    (b) All program employees are subject to statutory restrictions 
with respect to political activities; e.g., 5 U.S.C. 7324 and 1502.
    (c) Violation of the provisions of paragraph (a) of this section or 
the provisions of applicable statutes referenced in paragraph (b) of 
this section will constitute grounds for dismissal.
    (d) Program employees are subject to all applicable provisions of 
law and regulations and instructions of the Department and the Food 
Safety and Inspection Service concerning employee responsibilities and 
conduct. The setting forth of certain prohibitions in this part in no 
way limits the applicability of such general or other regulations or 
instructions.
0
26. Revise Sec.  590.134(b) to read as follows:


Sec.  590.134  Accessibility of product and cooler rooms.

* * * * *
    (b) The perimeter of each cooler room used to store eggs must be 
made accessible in order for the Secretary's representatives to 
determine the ambient temperature under which shell eggs packed into 
containers destined for the ultimate consumer are stored.

0
27. Revise Sec.  590.136 to read as follows:


Sec.  590.136  Accommodations and equipment to be furnished by 
facilities for use of program employees in performing service.

    (a) Program employee's office. Office space, including, but not 
limited to, furnishings, light, heat, and janitor service, will be 
provided without cost in the official plant for the use of program 
employees for official purposes. The room or space set apart for this 
purpose must meet the approval of the Food Safety and Inspection 
Service and be conveniently located, properly ventilated, and provided 
with lockers or file cabinets suitable for the protection and storage 
of supplies and with accommodations suitable for program employees to 
change clothing. At the discretion of the Administrator, small official 
plants requiring the services of less than one full-time program 
employee need not furnish accommodations for program employees as 
prescribed in this section where adequate accommodations exist in a 
nearby convenient location.
    (b) Accommodations and equipment. Such accommodations and equipment 
must include, but not be limited to, a room or area suitable for 
sampling product and a stationary or adequately secured storage box or 
cage (capable of being locked only by the program employee) for holding 
official samples.
0
28. Revise Sec.  590.140 to read as follows:


Sec.  590.140  Application for grant of inspection.

    The proprietor or operator of each official plant and official 
import inspection establishment must make application to the 
Administrator for inspection service unless exempted by Sec.  590.100. 
The application must be made in writing on forms furnished by the 
inspection service. In cases of change of name or ownership or change 
of location, a new application must be made.
0
29. Revise Sec.  590.142 to read as follows:


Sec.  590.142  Filing of application.

    An application for inspection service will be regarded as filed 
only when it has been:
    (a) Filled in completely;
    (b) Signed by the applicant; and
    (c) Received in the appropriate District Office.
0
30. Revise Sec.  590.146 to read as follows:


Sec.  590.146  Survey and grant of inspection.

    (a) Before inspection is granted, FSIS will survey the official 
plant to determine if the construction and facilities of the plant are 
in accordance with the regulations in this part. FSIS will grant 
inspection, subject to 9 CFR 500.7, when these requirements are met and 
the requirements contained in Sec.  590.149 are met.
    (b) FSIS will give notice in writing to each applicant granted 
inspection and will specify in the notice the official plant, including 
the limits of the plant's premises, to which the grant pertains.


Sec.  590.148  [Removed]

0
31. Remove Sec.  590.148.
0
32. Add Sec.  590.149 to read as follows:


Sec.  590.149  Conditions for receiving inspection.

    (a) Before receiving Federal inspection, a plant must have 
developed written sanitation Standard Operating Procedures, in 
accordance with part 416 and Sec.  591.1(a)(1) of this chapter.
    (b) Before receiving Federal inspection, a plant must conduct a 
hazard analysis, and develop and implement a HACCP plan, in accord with 
part 417 and Sec.  591.1(a)(1) of this chapter. Conditional inspection 
may be provided for a period not to exceed 90 days, during which period 
the facility must validate its HACCP plan.
    (c) Before producing new product for distribution in commerce, a 
plant must conduct a hazard analysis and develop a HACCP plan 
applicable to that

[[Page 6351]]

product, in accordance with Sec.  417.2 of this chapter. During a 
period not to exceed 90 days after the date the new product is produced 
for distribution in commerce, the plant must validate its HACCP plan, 
in accordance with Sec.  417.4 of this chapter.
0
33. Revise Sec.  590.160 to read as follows:


Sec.  590.160  Clean Water Act; refusal, suspension, or withdrawal of 
service.

    (a) Any applicant for inspection at a plant where the operations 
thereof may result in any discharge into the navigable waters in the 
United States is required by subsection 401(a)(1) (33 U.S.C. 1341) of 
the Clean Water Act as amended (86 Stat. 816, 91 Stat. 1566, 33 U.S.C. 
1251 et seq.), to provide the Administrator with a certification, as 
prescribed in said subsection, that any such discharge will comply with 
the applicable provisions of sections 301, 302, 303, 306, and 307 of 
the Act (33 U.S.C. 1311, 1312, 1313, 1316, and 1317). No grant of 
inspection can be issued unless such certification has been obtained, 
or is waived, because failure of refusal of the State, interstate 
agency, or the Administrator of the Environmental Protection Agency to 
act on a request for certification within a reasonable period (which 
should not exceed 1 year after receipt of such a request). Further, 
upon receipt of an application for inspection and a certification as 
required by subsection 401(a)(1) of the Clean Water Act, the 
Administrator (as defined in Sec.  590.5) is required by subparagraph 
(2) of said subsection to notify the Administrator of the Environmental 
Protection Agency for proceedings in accordance with that subsection. 
No grant of inspection can be made until the requirements of 401(a)(1) 
and (2) have been met.
    (b) Inspection may be suspended or revoked and plant approval 
terminated as provided in subsection 401(a)(4) and (5) of the Clean 
Water Act, as amended (33 U.S.C. 1341(a)(4) and (5)).
0
34. Revise Sec.  590.200 to read as follows:


Sec.  590.200  Records and related requirements.

    (a) Persons engaged in the transporting, shipping, or receiving of 
any eggs or egg products in commerce, or holding such articles so 
received, and all egg handlers, except producer-packers with an annual 
egg production from a flock of 3,000 hens or fewer, must maintain 
records documenting, for a period of 2 years, the following, to the 
extent applicable:
    (1) The date of lay, date and time of refrigeration, date of 
receipt, quantity and quality of eggs purchased or received, and from 
whom (including a complete address, unless a master list is 
maintained). Process records documenting that the temperature and 
labeling requirements in Sec.  590.50(a) have been met must also be 
kept;
    (2) The date of packaging, ambient air temperature surrounding 
product stored after processing, quantity and quality of eggs delivered 
or sold, and to whom (including a complete address, unless a master 
list is maintained);
    (3) If a consecutive lot numbering system is not employed to 
identify individual eggs, containers of eggs, or egg products, record 
the alternative code system used, in accordance with Sec.  
590.411(c)(3);
    (4) The date of disposal and quantity of restricted eggs, including 
inedible egg product or incubator reject product, sold or given away 
for animal food or other uses or otherwise disposed of, and to whom 
(including a complete address, unless a master list is maintained);
    (5) The individual or composite (running tally) record of 
restricted egg sales to household consumers. Records should show number 
of dozens sold on a daily basis. The name and address of the consumer 
is not required;
    (6) The date of production and quantity of egg products delivered 
or sold, and to whom (including a complete address, unless a master 
list is maintained);
    (7) The date of receipt and quantity of egg products purchased or 
received, and from whom (including a complete address, unless a master 
list is maintained);
    (8) The production records by categories of eggs such as graded 
eggs, nest-run eggs, dirties, checks, etc.; bills of sale, inventories, 
receipts, shipments, shippers, receivers, dates of shipment and 
receipt, carrier names, etc.
    (b) All records required to be maintained by this section must be 
made available to an authorized representative of the Secretary for 
official review and copying.
    (c) Records of all labeling, along with the product formulation and 
processing procedures as prescribed in Sec. Sec.  590.410 through 
590.412 of this chapter, must be kept by every person processing, 
except processors exempted under Sec.  590.100 of this chapter.

0
35. Revise Sec.  590.300 to read as follows:


Sec.  590.300  Appeal inspections.

    Any person receiving inspection service may, if dissatisfied with 
any decision of an inspector related to any inspection, file an appeal 
from such decision.
0
36. Revise Sec.  590.310 to read as follows:


Sec.  590.310  Appeal inspections; how made.

    Any appeal from the inspection decision of any program employee 
must be made to his or her immediate supervisor having jurisdiction 
over the subject matter of the appeal.
0
37. Revise Sec.  590.320 to read as follows:


Sec.  590.320  How to file an appeal inspection or decision review.

    The request for an appeal inspection or review of a program 
employee's decision may be made orally or in writing. If made orally, 
written confirmation may be required. The applicant must clearly 
identify the product involved, the decision being appealed, and the 
reasons for requesting the appeal.
0
38. Revise Sec.  590.340 to read as follows:


Sec.  590.340  Who must perform the appeal inspection or decision 
review.

    An appeal inspection or review of a program employee's decision, as 
requested in Sec.  590.310, must be performed by a program employee of 
FSIS other than the one who made the initial decision.
0
39. Revise Sec.  590.350 to read as follows:


Sec.  590.350  Appeal samples.

    An appeal sample will consist of product taken from the original 
sample containers plus an equal number of containers selected at 
random. A condition appeal cannot be made unless all originally sampled 
containers are available.


Sec.  Sec.  590.360 and 590.370  [Removed]

0
40. Remove Sec. Sec.  590.360 and 590.370.
0
41. Revise Sec.  590.410 to read as follows:


Sec.  590.410  Egg products required to be labeled.

    (a)(1) Packaged egg products that require special handling to 
maintain their wholesome condition must have the statement ``Keep 
Refrigerated,'' ``Keep Frozen,'' ``Perishable Keep Under 
Refrigeration,'' or such similar statement prominently displayed on the 
principal display panel.
    (2) Egg products that are distributed frozen and thawed prior to or 
during display for sale at retail must bear the statement ``Keep 
Frozen'' on the shipping container. Consumer-sized containers for such 
egg products must bear the statement ``Previously Handled Frozen for 
Your Protection, Refreeze or Keep Refrigerated.''

[[Page 6352]]

    (3) The labels of packages of egg products produced from shell eggs 
that have been treated with ionizing radiation must reflect that 
treatment in the ingredient statement on the finished product labeling.
    (b) Containers, portable tanks, and bulk shipments of edible egg 
products produced in official plants must be labeled in accordance with 
Sec. Sec.  590.411 through 590.415 and must bear the official 
identification shown in Figure 1 of Sec.  590.413.
    (c) Bulk shipments of unpasteurized egg products produced in 
official plants must bear a label containing the words ``date of 
loading,'' followed by a suitable space in which the date the 
container, tanker truck, or portable tank is loaded must be inserted. 
The label must be conspicuously located, and printed and affixed on 
material that cannot be detached or effaced due to exposure to weather. 
Before the truck or tank is removed from the place where it is 
unloaded, the carrier must remove or obliterate the label. Such 
shipments must also bear the official identification shown in Figure 2 
of Sec.  590.415.
0
42. Revise Sec.  590.411 to read as follows:


Sec.  590.411  Label approval.

    (a) All official plants, including official plants certified under 
a foreign inspection system in accordance with Sec.  590.910, must 
comply with the requirements contained in 9 CFR 412.1, except as 
otherwise provided in this part.
    (b) For the purposes of 9 CFR 412.2, an official establishment or 
establishment certified under a foreign inspection system includes an 
official plant.
    (c) Labels, containers, or packaging materials of egg products must 
show the following information, as applicable, on the principal display 
panel (except as otherwise permitted in this part), in accordance with 
the requirements of this part, or if applicable, 21 CFR 101.17(h):
    (1) A statement showing by the common or usual names, if any, of 
the kinds of ingredients comprising the product. Formulas are to be 
expressed in terms of a liquid product except for product that is dry-
blended. Also, for product to be dried, the label may show the 
ingredients in order of descending proportions by weight in the dried 
form. However, the formula submitted must include the percentage of 
ingredients in both liquid and dried form. If the product is comprised 
of two or more ingredients, such ingredients must be listed in the 
order of descending proportions by weight in the form in which the 
product is to be marketed (sold), except that ingredients in dried 
product (other than dry blended) may be listed in either liquid or 
dried form. When water (excluding that used to reconstitute dehydrated 
ingredients back to their normal composition) is added to a liquid or 
frozen egg product or to an ingredient of such products (in excess of 
the normal water content of that ingredient), the total amount of water 
added, including the water content of any cellulose or vegetable gums 
used, must be expressed as a percentage of the total product weight in 
the ingredient statement on the label;
    (2) The name, address and zip code of the distributor; qualified by 
such terms as ``distributed by,'' or ``distributors'';
    (3) The lot number or an alternative code indicating the date of 
production, in accordance with Sec.  590.200(a);
    (4) The net content;
    (5) An official inspection symbol and the number of the official 
plant in which the product was processed under inspection as set forth 
in Sec.  590.413;
    (6) Egg products processed from edible eggs of the turkey, duck, 
goose, or guinea must be clearly and distinctly labeled as to the 
common or usual name of the product indicating the type of eggs or egg 
products used in the product, e.g., ``Frozen whole turkey eggs,'' 
``Frozen whole chicken and turkey eggs.'' Egg products labeled without 
qualifying words as to the type of egg used in the product must be 
produced only from the edible egg of the domesticated chicken or the 
egg products produced from such eggs.
    (d) Liquid or frozen egg products identified as whole eggs and 
processed in other than natural proportions as broken from the shell 
must have a total egg solids content of 24.20 percent or greater.
    (e) Nutrition information may be included on labels used to 
identify egg products, providing such labeling complies with the 
provisions of 21 CFR part 101, promulgated under the Federal Food, 
Drug, and Cosmetic Act and the Fair Packaging and Labeling Act. Since 
these regulations have different requirements for consumer packaged 
products than for bulk packaged egg products not for sale or 
distribution to household consumers, label submission must be 
accompanied with information indicating whether the label covers 
consumer packaged or bulk packaged products. Nutrition labeling is 
required when nutrients, such as proteins, vitamins, and minerals are 
added to the product, or when a nutritional claim or information is 
presented on the labeling, except for the following, which are exempt 
from nutrition labeling requirements:
    (1) Egg products shipped in bulk form for use solely in the 
manufacture of other food and not for distribution to household 
consumers in such bulk form or containers.
    (2) Products containing an added vitamin, mineral, or protein, or 
for which a nutritional claim is made on the label, or in advertising, 
which is supplied for institutional food use only, provided that the 
manufacturer or distributor provides the required nutrition information 
directly to those institutions.
    (3) Any nutrients included in the product solely for technological 
purposes may be declared solely in the ingredients statement, without 
complying with nutrition labeling, if the nutrient(s) is otherwise not 
referred to in labeling or in advertising. All labels showing nutrition 
information or claims are subject to review by the Food and Drug 
Administration prior to approval by the Department.
    (f)(1) No label, container, or packaging material may contain any 
statement that is false or misleading. If the Administrator has reason 
to believe that a statement or formulation shows that an egg product is 
adulterated or misbranded, or that any labeling, including the size or 
form of any container in use or proposed for use, with respect to eggs 
or egg products, is false or misleading in any way, the Administrator 
may direct that such use be withdrawn unless the labeling or container 
is modified in such a manner as the Administrator may prescribe so that 
it will not be false or misleading, or the formulation of the product 
is altered in such a manner as the Administrator may prescribe so that 
it is not adulterated or would not cause misbranding.
    (2) If the Administrator directs that the use of any label, 
container, or packaging material be withdrawn because it contains any 
statement that is false or misleading, an opportunity for a hearing 
will be provided in accordance with Sec.  500.8(c) of this chapter.


Sec.  590.412  [Redesignated as Sec.  590.413]

0
43. Redesignate Sec.  590.412 as Sec.  590.413.
0
44. Add a new Sec.  590.412 to read as follows:


Sec.  590.412  Approval of generic labels.

    (a) All official plants, including official plants certified under 
a foreign inspection system in accordance with Sec.  590.910, must 
comply with the

[[Page 6353]]

requirements in 9 CFR 412.2, except as otherwise provided in this part.
    (b) For the purposes of 9 CFR 412.2, an official establishment or 
establishment certified under a foreign inspection system includes an 
official plant.
0
45. Revise newly redesignated Sec.  590.413 to read as follows:


Sec.  590.413  Form of official identification symbol and inspection 
mark.

    (a) The shield set forth in Figure 1 of this section containing the 
letters ``USDA'' must be the official identification symbol used in 
connection with egg products to denote that the official plant receives 
official inspection service. The inspection mark used on containers of 
edible egg products is set forth in Figure 1 of this section, except 
that the plant number may be preceded by the letter ``G'' in lieu of 
the word plant. The plant number may also be omitted from the official 
mark if applied on the container's principal display panel or other 
prominent location and preceded by the letter ``G.''
[GRAPHIC] [TIFF OMITTED] TP13FE18.000

    (b) [Reserved]
0
46. Revise Sec.  590.415 to read as follows:


Sec.  590.415  Use of other official identification.

    All unpasteurized egg products shipped from an official plant must 
be marked with the identification set forth in Figure 2 of this 
section. Such product must meet all requirements for egg products that 
are permitted to bear the official inspection mark shown in Sec.  
590.413, except for pasteurization, heat treatment, or other method of 
treatment sufficient to reduce Salmonella. Such product must not be 
released into consumer channels until it has been subjected to 
pasteurization, heat treatment, or other method of treatment sufficient 
to reduce Salmonella. After pasteurization or treatment, the product 
may bear the official inspection mark as shown in Sec.  590.413.
[GRAPHIC] [TIFF OMITTED] TP13FE18.001


[[Page 6354]]




Sec.  590.418  [Amended]

0
47. Amend Sec.  590.418 by removing paragraphs (a) and (c) and 
redesignate paragraph (b) as an undesignated paragraph.
0
48. Revise Sec.  590.420(a) and (b) to read as follows:


Sec.  590.420  Inspection.

    (a) Inspection shall be made, pursuant to the regulations in this 
part, of the processing of egg products in each official plant 
processing egg products for commerce, unless exempted under Sec.  
590.100. Inspections, certifications, or specification-type gradings, 
and other inspections which may be requested by the official plant and 
are in addition to the normal inspection requirements and functions for 
the processing, production, or certification for a wholesome egg 
product under this part, shall be made pursuant to the voluntary egg 
products inspection regulations (part 592 of this chapter).
    (b) Any food manufacturing establishment or institution which uses 
any eggs that do not meet the requirements of 21 U.S.C. 1044(a)(1) in 
the preparation of any articles for human food shall be deemed to be a 
plant processing egg products requiring inspection under the 
regulations in this part.
* * * * *


Sec.  590.422  [Amended]

0
49. Amend Sec.  590.422 by removing the last sentence of the section.
0
50. Amend Sec.  590.430 by revising paragraph (b) to read as follows:


Sec.  590.430  Limitation on entry of material.

* * * * *
    (b) Inedible egg products may be brought into an official plant for 
storage, processing, and reshipment provided it is handled in such a 
manner that adequate segregation and inventory controls are maintained 
at all times. The processing of inedible egg products must be done 
under conditions that will not affect the processing of edible 
products, such as processing in separate areas or at times when no 
edible products are being processed. If the same equipment or areas are 
used to process both inedible and edible eggs, then the equipment and 
processing areas used to process inedible eggs must be thoroughly 
cleaned and sanitized prior to processing any edible egg products.
0
51. Revise Sec.  590.435 to read as follows:


Sec.  590.435  Use of food ingredients and approval of materials.

    (a)(1) No substance may be used in the processing of egg products, 
for any purpose, unless its use is authorized under 21 CFR as a direct 
food additive (part 172), a secondary direct food additive (part 173), 
an indirect food additive (parts 174-178), a source of radiation (part 
179), an interim-listed direct food additive (part 180), a prior-
sanctioned substance (part 181), a Generally Recognized As Safe (GRAS) 
substance (parts 182 or 184), or by 21 CFR 160.185, or by regulation in 
this chapter. Substances and ingredients used in the processing of egg 
products capable of use as human food must be clean, wholesome, and 
unadulterated.
    (2) No substance which is intended to impart color in any egg 
product may be used unless such use is authorized under 21 CFR as a 
color additive (parts 73, 74, or 81) or by regulation in this chapter.
    (b) Substances permitted for use in egg products under 21 CFR will 
be permitted for such use under this chapter, subject to declaration 
requirements in 9 CFR 424.22(c) and 9 CFR 590.411, unless precluded 
from such use or further restricted in this chapter. Such substances 
must be safe and effective under conditions of use and not result in 
the adulteration of product. The Administrator may require, in addition 
to listing the ingredients, a declaration of the additive and the 
purpose of its use.
    (c) Chemical additives to be used in the processing of egg products 
must be safe under the conditions of their intended use and in amounts 
sufficient to accomplish their intended purpose. Chemical additives may 
not promote deception or cause the product to be otherwise adulterated 
or unwholesome. Scientific data showing the additive meets the above 
specified criteria must be maintained and made available to FSIS 
program employees.
0
52. Revise Sec.  590.440(c) to read as follows:


Sec.  590.440  Processing ova.

* * * * *
    (c) All products containing ova must be labeled in accordance with 
Sec.  590.411.


Sec.  Sec.  590.500 and 590.502   [Removed]

0
53. Remove Sec. Sec.  590.500 and 590.502.
0
54. Revise Sec.  590.504 to read as follows:


Sec.  590.504  General operating procedures.

    (a) Operations involving the processing, storing, and handling of 
eggs, ingredients, and egg products must be strictly in accordance with 
clean and sanitary methods and must be conducted as rapidly as 
practicable.
    (b)(1) Egg products are subject to inspection in each official 
plant processing egg products for commerce.
    (2) Any egg products not processed in accordance with the 
regulations in this part or part 591 or that are not otherwise fit for 
human food will be removed and segregated.
    (c)(1) All loss and inedible eggs or inedible egg products must be 
placed in a container clearly labeled ``inedible'' and containing a 
sufficient amount of denaturant or decharacterant, such as an 
acceptable FD&C color additive, suspended in the product. Eggs must be 
crushed and the substance dispersed through the product in amounts 
sufficient to give the product a distinctive appearance or odor. 
Inedible product may be held in containers clearly labeled ``inedible'' 
which do not contain a denaturant as long as such inedible product is 
properly packaged, labeled and segregated, and inventory controls are 
maintained. Such inedible product must be denatured or decharacterized 
before being shipped from a facility.
    (2) Denatured or decharacterized inedible egg products may be 
shipped from an official plant for industrial use or animal food, 
provided that it is properly packaged, labeled, and segregated, and 
inventory controls are maintained.
    (d)(1) Egg products must be processed to meet the standard set out 
in Sec.  590.570.
    (2) Unpasteurized egg products may be shipped from an official 
plant to another official plant only when they are to be pasteurized, 
heat treated, or treated using other methods of treatment sufficient to 
reduce Salmonella in the second official plant. Shipments of 
unpasteurized egg products shipped from one official plant to another 
for pasteurization or treatment must be sealed in cars or trucks and 
labeled in accordance with Sec.  590.410(c). Containers of 
unpasteurized egg product must be marked with the identification mark 
shown in Figure 2 of Sec.  590.415.
    (e) When inspection program personnel do not suspect noncompliance 
by an official plant with any provisions of this part, they may permit 
that plant to move egg products that have been sampled and analyzed for 
Salmonella, or any other reason, before receiving the test results so 
long as the plant maintains control of the products represented by the 
sample pending test results.


Sec.  590.506  [Removed]

0
55. Remove Sec.  590.506.
0
56. Revise Sec.  590.508 to read as follows:

[[Page 6355]]

Sec.  590.508  Candling and transfer-room operations.

    Eggs must be handled in a manner that minimizes sweating prior to 
breaking or processing.
0
57. Amend Sec.  590.510 by revising paragraphs (a) introductory text, 
(c)(1) and (3), and (d) introductory text to read as follows:


Sec.  590.510  Classifications of eggs used in the processing of egg 
products.

    (a) The eggs must be sorted and classified into the following 
categories:
* * * * *
    (c)(1) When presented for breaking, eggs must have an edible 
interior quality and the shell must be sound and free of adhering dirt 
and foreign material. However, checks and eggs with a portion of the 
shell missing may be used when the shell is free of adhering dirt and 
foreign material and the shell membranes are not ruptured.
* * * * *
    (3) Eggs with meat or blood spots may be used if the spots are 
removed.
    (d) All loss or inedible eggs must be placed in a designated 
container and handled as required in Sec.  590.504(c). Eggs extensively 
damaged during breaking, whether not completely cracked open 
mechanically or in the movement of trays of eligible eggs for hand 
breaking, must be broken promptly. For the purpose of this section and 
Sec.  590.522, inedible and loss eggs include crusted yolks, filthy and 
decomposed eggs, and the following:
* * * * *
0
58. Amend Sec.  590.516 by revising the section heading and paragraph 
(a) to read as follows:


Sec.  590.516  Cleaning of eggs prior to packaging, breaking, or 
pasteurizing.

    (a) All eggs, except as provided in Sec.  590.801, must be clean 
prior to packaging, breaking, or pasteurizing. If a sanitizer is used, 
it must be used in accordance with FDA requirements for the intended 
use.
* * * * *


Sec.  590.520  [Removed]

0
59. Remove Sec.  590.520.
0
60. Revise Sec.  590.522 to read as follows:


Sec.  590.522  Egg products processing room operations.

    Eggs used in processed egg products must be broken in a sanitary 
manner and examined to ensure that the contents are acceptable for 
human consumption.


Sec.  Sec.  590.530 and 590.532  [Removed]

0
61. Remove Sec. Sec.  590.530 and 590.532.
0
62. Revise Sec.  590.534 to read as follows:


Sec.  590.534  Freezing facilities.

    Freezing rooms, either on or off the premises, must be capable of 
solidly freezing, or reducing to a temperature of 10[emsp14][deg]F or 
lower, all liquid egg products.


Sec.  Sec.  590.536, 590.538 through 590.540, 590.542, 590.544, 590.546 
through 590.550, 590.552 and 590.560   [Removed]

0
63. Remove Sec. Sec.  590.536, 590.538 through 590.540, 590.542, 
590.544, 590.546 through 590.550, 590.552 and 590.560.
0
64. Revise Sec.  590.570 to read as follows:


Sec.  590.570  Control of pathogens in egg products.

    Egg products must be produced to be edible without additional 
preparation to achieve food safety and may receive additional 
preparation for palatability or aesthetic, epicurean, gastronomic, or 
culinary purposes. Egg products are not required to bear a safe-
handling instruction or other labeling that directs that the product 
must be cooked or otherwise treated for safety.


Sec.  590.575  [Removed]

0
65. Remove Sec.  590.575.
0
66. Revise Sec.  590.580 to read as follows:


Sec.  590.580  Pathogen reduction standards testing.

    (a) Official plants must test to determine that the production of 
egg products is in compliance with the Act and the egg products 
inspection regulations.
    (b) To ensure adequate pasteurization:
    (1) Pasteurized liquid, frozen, and dried egg products, and heat 
treated dried egg whites must be sampled and analyzed for the presence 
of Salmonella spp. Such testing must be performed in a manner 
sufficient such that it is possible for the official plant to verify 
that the system is capable of eliminating Salmonella spp. at the time 
that the annual reassessment occurs, and as regularly as necessary 
between annual reassessments, to show that the system, when tested, is 
working.
    (2) Samples must be analyzed for the presence of Salmonella spp. 
with such sequence, with such frequency, and using such laboratory 
methods as is sufficient to ensure that product is not adulterated.
    (3) Samples must be drawn from the final packaged form.
    (c) Results of all partial and completed analyses performed under 
paragraph (b) of this section must be provided to inspection program 
personnel promptly upon receipt by the official plant. Positive test 
results must be provided to inspection program personnel immediately 
upon receipt by the official plant.
0
67. Add Sec.  590.590 to read as follows:


Sec.  590.590  Use of irradiated shell eggs to produce egg products.

    Irradiated shell eggs used to produce pasteurized egg products must 
be used in conjunction with heat or another lethality treatment to 
produce a ready-to-eat product. Unless otherwise approved by FDA, the 
irradiation treatment of the shell eggs must precede the heat or other 
lethality treatment applied to the egg products.


Sec.  Sec.  590.600 through 590.680  [Removed]

0
68. Remove the undesignated center heading ``Exempted Egg Products 
Plants'' and Sec. Sec.  590.600 through 590.680.
0
69. Add an undesignated center heading and Sec.  590.700 to read as 
follows:

Inspection and Disposition of Restricted Eggs


Sec.  590.700  Prohibition on disposition of restricted eggs.

    (a) No person may buy, sell, or transport, or offer to buy or sell, 
or offer or receive for transportation in any business in commerce any 
restricted eggs capable of use as human food, except as authorized in 
Sec. Sec.  590.100 and 590.720.
    (b) No egg handler may possess with the intent to use, or use, any 
restricted eggs in the preparation of human food, except as provided in 
Sec. Sec.  590.100 and 590.720.
0
70. Add Sec.  590.720 to read as follows:


Sec.  590.720  Disposition of restricted eggs.

    (a) Except as exempted in Sec.  590.100, eggs classified as checks, 
dirts, incubator rejects, inedibles, leakers, or loss must be disposed 
of by one of the following methods at the point and time of 
segregation:
    (1) Checks and dirts must be labeled in accordance with Sec.  
590.800 and shipped to an official plant for segregation and 
processing. Inedible and loss eggs must not be intermingled in the same 
container with checks and dirts.
    (2) By destruction in a manner that clearly identifies the products 
as being inedible and not for human consumption, such as crushing and 
denaturing or decharacterizing in accordance with Sec.  590.504(c). The 
products must also be identified as ``Inedible Egg Product--Not To Be 
Used As Human Food.''
    (3) Processing for industrial use or for animal food. Such products 
must be

[[Page 6356]]

denatured or decharacterized in accordance with Sec.  590.504(c) and 
identified as provided in Sec. Sec.  590.840 and 590.860, or properly 
handled in a manner that clearly identifies the products as being 
inedible and not for human consumption and does not adulterate egg 
product intended for human consumption. Notwithstanding the foregoing, 
product which was produced under official supervision and transported 
for industrial use or animal food need not be denatured or 
decharacterized if it is shipped under Government seal and received by 
a program employee as defined in this part.
    (4) By coloring the shells of loss and inedible eggs with a 
sufficient amount of FD&C color to give a distinct appearance, or 
applying a substance that will penetrate the shell and decharacterize 
the contents of the egg. However, lots of eggs containing significant 
percentages of eggs having small to medium blood spots or meat spots, 
but no other types of loss or inedible eggs, may be shipped directly to 
official plants, provided they are conspicuously labeled with the name 
and address of the shipper and the wording ``Spots--For Processing Only 
In Official Egg Products Plants.''
    (5) Incubator rejects must be broken or crushed and denatured or 
decharacterized in accordance with Sec.  590.504(c) and labeled as 
required in Sec. Sec.  590.840 and 590.860.
    (b) Eggs that are packed for the ultimate consumer and have been 
found to exceed the tolerance for restricted eggs permitted in the 
official standards for U.S. Consumer Grade B but have not been shipped 
for retail sale must be identified as required in Sec. Sec.  590.800 
and 590.860 and must be shipped directly or indirectly:
    (1) To an official plant for proper segregation and processing; or
    (2) Be re-graded so that they comply with the official standards; 
or
    (3) Used as other than human food.
    (c) Records must be maintained as provided in Sec.  590.200 to 
ensure proper disposition.
0
71. Add Sec.  590.801 to read as follows:


Sec.  590.801  Nest-run or washed ungraded eggs.

    Nest-run or washed ungraded eggs are exempt from the labeling 
provisions in Sec.  590.800. However, when such eggs are sold to 
consumers, they may not exceed the tolerance for restricted eggs for 
U.S. Consumer Grade B shell eggs.


Sec.  Sec.  590.900 through 590.970   [Removed]

0
72. Remove undesignated center heading ``Imports'' and Sec. Sec.  
590.900 through 590.970.
0
73. Add subpart B, consisting of Sec. Sec.  590.900 through 590.965, to 
read as follows:
Subpart B--Imports
Sec.
590.900 Definitions; requirements for importation into the United 
States.
590.901 Egg products offered for entry and entered to be handled and 
transported as domestic; entry into official plants; transportation.
590.905 Importation of restricted eggs.
590.910 Eligibility of foreign countries for importation of eggs and 
egg products into the United States.
590.915 Imported products; foreign inspection certificates required.
590.920 Import inspection application.
590.925 Inspection of eggs and egg products offered for entry.
590.930 Eggs and egg products offered for entry, retention in 
customs custody; delivery under bond; movement prior to inspection; 
handling; equipment and assistance.
590.935 Means of conveyance and equipment used in handling egg 
products offered for entry to be maintained in sanitary condition.
590.940 Identification of egg products offered for entry; official 
import inspection marks and devices.
590.945 Eggs and egg products offered for entry; reporting of 
findings to customs; handling of articles refused entry; appeals, 
how made; denaturing procedures.
590.950 Labeling of immediate containers of egg products offered for 
entry.
590.955 Labeling of shipping containers of egg products offered for 
entry.
590.956 Relabeling of imported egg products.
590.960 Small importations for importer's personal use, display, or 
laboratory analysis.
590.965 Returned to the United States inspected and identified 
covered products; exemption.

Subpart B--Imports


Sec.  590.900  Definitions; requirements for importation into the 
United States.

    (a) When used in this subpart, the following terms will be 
construed to mean:
    (1) Import (Imported). To bring within the territorial limits of 
the United States, whether that arrival is accomplished by land, air, 
or water.
    (2) Offer(ed) for entry. The point at which the importer presents 
the imported product for reinspection.
    (3) Entry (entered) means the point at which imported product 
offered for entry receives reinspection and is marked with the official 
mark of inspection, as required by Sec.  590.940.
    (4) Official Import Inspection Establishment. This term means any 
establishment, other than an official establishment as defined in 9 CFR 
301.2, where inspections are authorized to be conducted as prescribed 
in Sec.  590.925 of this subchapter.
    (b) No egg products may be imported into the United States unless 
they are healthful, wholesome, fit for human food, not adulterated, and 
contain no dye, chemical, preservative, or ingredient which renders 
them unhealthful, unwholesome, unadulterated, or unfit for human food. 
Such products must also comply with the regulations prescribed in this 
subpart to ensure that they adhere to the standards provided for in the 
Act. The provisions of this subpart will apply to these products only 
if they are capable for use as human food.
    (c) Approval for Federal import inspection must be in accordance 
with Sec. Sec.  590.140 through 590.149.
    (d) Egg products may be imported only if they are processed solely 
in the countries listed in Sec.  590.910(b).


Sec.  590.901  Egg products offered for entry and entered to be handled 
and transported as domestic; entry into official plants; 
transportation.

    (a) All egg products, after entry into the United States in 
compliance with this subpart, will be deemed and treated and, except as 
provided in Sec. Sec.  590.935 and 590.960, will be handled and 
transported as domestic product, and will be subject to the applicable 
provisions of this part and to the provisions of the Egg Products 
Inspection Act and the Federal Food, Drug, and Cosmetic Act.
    (b) Imported egg products entered in accordance with this subpart 
may, subject to the provisions of the regulations, be taken into 
official plants and be mixed with or added to egg products that are 
inspected and passed or exempted from inspection in such plants.
    (c) Imported egg products that have been inspected and passed under 
this subpart may be transported in commerce only upon compliance with 
the applicable regulations.


Sec.  590.905  Importation of restricted eggs.

    (a) No containers of restricted eggs other than checks or dirties 
will be imported into the United States. The shipping containers of 
such eggs shall be identified with the name, address, and country of 
origin of the exporter, and the date of pack and the quality of the 
eggs (e.g., checks of dirties) preceded by the word ``Imported'' or the 
statement ``Imported Restricted Eggs-For Processing Only In An Official 
USDA Plant,'' or ``Restricted Eggs--Not To Be Used As Human Food.'' 
Such identification shall be legible and conspicuous.

[[Page 6357]]

    (b) For properly sealed and certified shipments of shell eggs for 
breaking at an official egg products plant, the containers need not be 
labeled, provided that the shipment is segregated and controlled upon 
arrival at the destination breaking plant.


Sec.  590.910  Eligibility of foreign countries for importation of eggs 
and egg products into the United States.

    (a)(1) Whenever it is determined by the Administrator that the 
system of egg products inspection maintained by any foreign country, 
with respect to plants preparing products in such country for export to 
the United States, insures compliance of such plants and their products 
with requirements equivalent to all the inspection, building 
construction standards, and all other provisions of the Act and the 
regulations in this part which are applied to official plants in the 
United States, and their products, and that reliance can be placed upon 
certificates required under this part from authorities of such foreign 
country, notice of that fact will be given by including the name of 
such foreign country in paragraph (b) of this section. Thereafter, 
products prepared in such plants which are certified and approved in 
accordance with paragraph (a)(3) of this section, will be eligible so 
far as this part is concerned for importation into the United States 
from such foreign country after applicable requirements of this part 
have been met.
    (2) The determination of acceptability of a foreign egg products 
inspection system for purposes of this section must be based on an 
evaluation of the foreign program in accordance with the following 
requirements and procedures:
    (i) The system must have a program organized and administered by 
the national government of the foreign country. The system as 
implemented must provide standards equivalent to those of the Federal 
system of egg products inspection in the United States with respect to:
    (A) Organizational structure and staffing, so as to insure uniform 
enforcement of the requisite laws and regulations in all plants 
throughout the system at which products are prepared for export to the 
United States;
    (B) Ultimate control and supervision by the national government 
over the official activities of all employees or licensees of the 
system;
    (C) The assignment of competent, qualified inspectors;
    (D) Authority and responsibility of national inspection officials 
to enforce the requisite laws and regulations governing egg products 
inspection and to certify or refuse to certify products intended for 
export;
    (E) Adequate administrative and technical support;
    (F) The inspection and residue standards applied to egg products 
produced in the United States.
    (G) Other requirements of adequate inspection service as required 
by the regulations in this part.
    (ii) The legal authority for the system and the regulations 
thereunder must impose requirements equivalent to those governing the 
system of egg products inspection organized and maintained in the 
United States with respect to:
    (A) Official controls by the national government over plant 
construction, building and facilities, and equipment;
    (B) Official supervision of the processing of egg products in 
plants by the assignment of inspectors to plants certified under 
paragraph (a)(2)(iv) of this section to ensure that adulterated or 
misbranded product is not prepared for export to the United States;
    (C) Any product that is prepared under inspection in a plant must 
be inspected in such a plant as often as the inspector deems necessary 
in order to ascertain if the product is unadulterated, wholesome, 
properly labeled, and fit for human food at the time it leaves the 
plant. Upon any such inspection, if any product or portion thereof is 
found to be adulterated, unwholesome, or otherwise unfit for human 
food, such product or portion thereof must be condemned and must 
receive such treatment as provided in Sec.  590.504(c);
    (D) Complete separation of plants certified under paragraph 
(a)(2)(iv) of this section from plants not certified, and the 
maintenance of a single standard of inspection and sanitation 
throughout all certified plants;
    (E) Requirements for sanitation at certified plants and for 
sanitary handling of egg products;
    (F) Official controls over condemned material until destroyed or 
removed and thereafter excluded from the plant;
    (G) A Hazard Analysis and Critical Control Point (HACCP) system, as 
set forth in part 417 of this chapter; and
    (H) Other matters for which requirements are contained in the Act 
or regulations in this part.
    (iii) Countries desiring to establish eligibility for the 
importation of egg products into the United States may request a 
determination of eligibility by presenting copies of the laws and 
regulations on which the foreign egg products inspection system is 
based and such other information as the Administrator may require with 
respect to matters enumerated in paragraphs (a)(2)(i) and (ii) of this 
section. Determination of eligibility is based on a study of the 
documents and other information presented and an initial review of the 
system in operation by a representative of the Department using the 
criteria listed in paragraphs (a)(2)(i) and (ii) of this section. 
Maintenance of eligibility of a country for importation of egg products 
into the United States depends on the results of periodic reviews of 
the foreign egg products inspection system in operation by a 
representative of the Department, and the timely submission of such 
documents and other information related to the conduct of the foreign 
inspection system, including information required by paragraph (e) of 
section 20 of the Act, as the Administrator may find pertinent to and 
necessary for the determinations required by this section of the 
regulations.
    (iv) The foreign inspection system must maintain a program to 
assure that the requirements referred to in this section, equivalent to 
those of the Federal system of egg products inspection in the United 
States, are being met. The program as implemented must provide for the 
following:
    (A) Periodic supervisory visits by a representative of the foreign 
inspection system to each plant certified in accordance with paragraph 
(a)(3) of this section to ensure that requirements referred to in 
paragraphs (a)(2)(ii)(A) through (H) of this section are being met: 
Provided, that such visits are not required with respect to any plant 
during a period when the plant is not operating or is not engaged in 
producing products for exportation to the United States;
    (B) Written reports prepared by the representative of the foreign 
inspection system who has conducted a supervisory visit, documenting 
his or her findings with respect to the requirements referred to in 
paragraphs (a)(2)(ii)(A) through (H) of this section, copies of which 
must be made available to the representative of the Department at the 
time of that representative's review upon request by that 
representative to a responsible foreign meat inspection official: 
Provided, that such reports are not required with respect to any plant 
during a period when the plant is not operating or is not engaged in 
producing products for exportation to the United States; and
    (C) Random sampling and testing at the point of production, for 
residues identified by the exporting country's inspection authorities 
or by this Agency as potential contaminants, in accordance with 
sampling and

[[Page 6358]]

analytical techniques approved by the Administrator, provided that such 
testing is required only on samples taken of egg products intended for 
importation into the United States.
    (3) Only those plants that are determined and certified to the 
Agency by a responsible official of the foreign egg products inspection 
system as fully meeting the requirements of paragraphs (a)(2)(i) and 
(ii) of this section are eligible to have their products imported into 
the United States. Plant eligibility is subject to review by the Agency 
(including observations of the plants by official program personnel 
representatives at times prearranged with the foreign egg products 
inspection system officials). Foreign plants certifications must be 
renewed annually. Notwithstanding certification by a foreign official, 
the Administrator may terminate the eligibility of any foreign plant 
for the importation of its products into the United States if it does 
not comply with the requirements listed in paragraphs (a)(2)(i) and 
(ii) of this section, or if current plant information cannot be 
obtained. The Administrator will provide reasonable notice to the 
foreign government of the proposed termination of any foreign plant, 
unless a delay in terminating its eligibility could result in the 
importation of adulterated or misbranded product.
    (i) For a new plant, or any plant for which information from last 
year's electronic certification or paper certificate has changed, the 
certification or certificate must contain: The date; the foreign 
country; the foreign plant's name, address, and foreign plant number; 
the foreign official's title and signature (for paper certificates 
only); the type of operations conducted at the plant (e.g., processing, 
storage, exporting warehouse); and the plant's eligibility status 
(e.g., new or relisted (if previously delisted)). Processing plant 
certifications must address the type of products produced at the plant 
(e.g., the process category).
    (ii) If the plant information provided on the preceding year's 
electronic foreign plant certification or paper certificate, as 
required in paragraph (a)(3)(i) of this section, has not changed, the 
certification or certificate must contain: The date, the foreign 
country, the foreign plant's name, and the foreign official's title and 
signature (for paper certificates only).
    (4) Egg products from foreign countries not listed in paragraph (b) 
of this section are not eligible for importation into the United 
States, except as provided by Sec. Sec.  590.960 and 590.965. The 
listing of any foreign country under this section may be withdrawn 
whenever it is determined by the Administrator that the system of egg 
products inspection maintained by such foreign country does not assure 
compliance with requirements equivalent to all the inspection, building 
construction standards, and other requirements of the Act and the 
regulations in this part as applied to official plants in the United 
States; or that reliance cannot be placed upon certificates required 
under this part from authorities of such foreign country; or that, for 
lack of current information concerning the system of egg products 
inspection being maintained by such foreign country, such foreign 
country should be required to reestablish its eligibility for listing.
    (b) It has been determined that egg products from the following 
countries covered by foreign egg products inspection certificates of 
the country of origin as required by Sec.  590.915 are eligible under 
the regulations in this part for entry into the United States after 
inspection and marking as required by the applicable provisions of this 
part: Canada, The Netherlands.


Sec.  590.915  Imported products; foreign inspection certificates 
required.

    (a) Except as provided in Sec.  590.960, each consignment imported 
into the United States must have an electronic foreign inspection 
certification or a paper foreign inspection certificate issued by an 
official of the foreign government agency responsible for the 
inspection and certification of the product.
    (b) An official of the foreign government agency must certify that 
any product described on any official certificate was produced in 
accordance with the regulatory requirements of Sec.  590.910.
    (c) The electronic foreign inspection certification must be in 
English, be transmitted directly to FSIS before the product's arrival 
at the official import inspection establishment, and be available to 
import inspection personnel.
    (d) The paper foreign inspection certificate must accompany each 
consignment; be submitted to import inspection personnel at the 
official import inspection establishment; be in English; and bear the 
official seal of the foreign government responsible for the inspection 
of the product, and the name, title, and signature of the official 
authorized to issue the inspection certificates for products imported 
into the United States.
    (e) The electronic foreign inspection certification and paper 
foreign inspection certificate must contain:
    (1) The date;
    (2) The foreign country of export and the producing foreign 
establishment number;
    (3) The species used to produce the product and the source country 
and foreign establishment number, if the source materials originate 
from a country other than the exporting country;
    (4) The product's description including the process category, the 
product category, and the product group;
    (5) The name and address of the importer or consignee;
    (6) The name and address of the exporter or consignor;
    (7) The number of units (pieces or containers) and the shipping or 
identification mark on the units;
    (8) The net weight of each lot; and
    (9) Any additional information the Administrator requests to 
determine whether the product is eligible to be imported into the 
United States.


Sec.  590.920  Import inspection application.

    (a) Applicants must submit an import inspection application to 
apply for the inspection of any product offered for entry. Applicants 
may apply for inspection using a paper or electronic application form.
    (b) Import inspection applications for each consignment must be 
submitted (electronically or on paper) to FSIS in advance of the 
shipment's arrival at the official import establishment where the 
product will be reinspected, but no later than when the entry is filed 
with U.S. Customs and Border Protection.
    (c) The provisions of this section do not apply to products that 
are exempted from inspection by Sec. Sec.  590.960 and 590.965.


Sec.  590.925  Inspection of eggs and egg products offered for entry.

    (a)(1) Except as provided in Sec. Sec.  590.960 and 590.965 and 
paragraph (b) of this section, egg products offered for entry from any 
foreign country must be reinspected at an official import inspection 
establishment or official plant by a program inspector before they may 
be allowed entry into the United States.
    (2) Every lot of product must routinely be given visual 
reinspection by a program inspector for appearance and condition and be 
checked for certification and label compliance as provided in 
Sec. Sec.  590.915, 590.950, and 590.955.
    (3) Program inspectors must consult the electronic inspection 
system for reinspection instructions. The electronic inspection system 
will assign

[[Page 6359]]

reinspection levels and procedures based on established sampling plans 
and established product and plant history.
    (b) Official program personnel may take, without cost to the United 
States, from each consignment of egg product offered for entry, such 
samples of the products as are deemed necessary to determine the 
eligibility of the products for entry into the commerce of the United 
States.


Sec.  590.930  Eggs and egg products offered for entry, retention in 
customs custody; delivery under bond; movement prior to inspection; 
handling; equipment and assistance.

    (a) No egg products required by this subpart to be inspected will 
be released from customs custody prior to required inspections, but 
such product may be delivered to the importer, or his agent, prior to 
inspection, if the importer furnishes a bond, in a form prescribed by 
the Secretary of the Treasury, on the condition that the product must 
be returned, if demanded, to the collector of the port where the 
product was offered for clearance through customs.
    (b) Notwithstanding paragraph (a) of this section, no product 
required by this subpart to be inspected will be moved prior to 
inspection from the port of arrival where first unloaded, and if 
arriving by water from the wharf where first unloaded at such port, to 
any place other than the place designated in accordance with this part 
as the place where the product must be inspected; and no product will 
be conveyed in any manner other than in compliance with this subpart.
    (c) The importer, or his agent, must furnish such equipment and 
must provide such assistance for handling and inspecting, where 
applicable, egg products offered for entry as the program inspector may 
require.
    (d) Official import inspection establishments must provide 
buildings and equipment that meet the sanitation requirements contained 
in 9 CFR part 416.


Sec.  590.935  Means of conveyance and equipment used in handling egg 
products offered for entry to be maintained in sanitary condition.

    (a) Compartments of steamships, railroad cars, and other means of 
conveyance transporting any egg products to the United States, and all 
chutes, platforms, racks, tables, tools, utensils, and all other 
devices used in moving and handling any egg products offered for entry 
into the United States, must be maintained in accordance with 9 CFR 
416.4.
    (b) All conveyances containing imported liquid egg products must be 
sealed by inspection authorities in the exporting country. Seals may be 
broken at U.S. port-of-entry for purposes of inspection by official 
program personnel or customs officers.


Sec.  590.940  Identification of egg products offered for entry; 
official import inspection marks and devices.

    (a) Except for products offered for entry from Canada, egg products 
that upon reinspection are found to be acceptable for entry into the 
United States must be identified as ``U.S. Inspected and Passed'' 
product. The official inspection legend shown in paragraph (b) of this 
section will identify product only after completion of official import 
inspection and product acceptance.
    (b) The official mark for identifying egg products offered for 
entry as ``U.S. Inspected and Passed'' must be in the following form, 
and any device approved by the Administrator for applying such mark 
must be an official device.\1\
---------------------------------------------------------------------------

    \1\ The number ``I-38'' is given as an example only. The plant 
number of the official plant, facility, or official import 
inspection establishment where the product was inspected must be 
shown on each stamp impression.
[GRAPHIC] [TIFF OMITTED] TP13FE18.002

    (c) Owners or operators of plants, other than official plants, who 
want to have import inspections made at their plants, must apply to the 
Administrator for approval of their establishments for such purpose. 
Application must be made on a form furnished by the Program, Food 
Safety and Inspection Service, U.S. Department of Agriculture, 
Washington, DC, and must include all information called for by that 
form.
    (d) No brand manufacturer or other person will cast or otherwise 
make, without an official certificate issued by official program 
personnel, a brand or other marking device containing an official 
inspection legend, or simulation thereof, as shown in Sec.  590.940(b).
    (e) The inspection legend may be placed on containers of product 
before completion of the official import inspection if the containers 
are being inspected by an import inspector who reports directly to a 
program supervisor, the product is not required to be held at the 
official import inspection establishment pending receipt of laboratory 
test results, and a written procedure for the controlled stamping, 
submitted by the official import inspection establishment and approved 
by the Food Safety and Inspection Service, is on file at the import 
inspection location where the inspection is to be performed.
    (f)(1) The written procedure for the controlled release and 
identification of product should be in the form of a letter and must 
include the following:
    (i) That stamping under this subpart is limited to those lots of 
product that can be inspected on the day that certificates for the 
product are examined;
    (ii) That all products that have been pre-stamped will be stored in 
the facility where the import inspection will occur;
    (iii) That inspection marks applied under this part will be removed 
from any lot of product subsequently refused entry on the day the 
product is rejected; and
    (iv) That the establishment will maintain a daily stamping log 
containing the following information for each lot of product: The date 
of inspection, the country of origin, the foreign establishment number, 
the product name, the number of units, the shipping container marks and 
foreign inspection certificate number covering the product to be 
inspected. The daily log must be retained by the establishment in 
accordance with Sec.  590.200.
    (2) An establishment's controlled program privilege may be 
cancelled orally or in writing by the inspector who is supervising its 
enforcement whenever the inspector finds that the establishment has 
failed to comply with the provisions of this subpart or any conditions 
imposed pursuant thereto. If the cancellation is oral, the decision and 
the reasons for it must be confirmed in writing, as promptly as 
circumstances allow. Any person whose controlled pre-stamping program 
privilege has been cancelled may appeal the decision to the 
Administrator, in writing, within ten (10) days after receiving written 
notification of the cancellation. The appeal must state all of the 
facts and reasons upon which the person relies to show that the 
controlled program was wrongfully cancelled. The Administrator will 
grant or deny the appeal, in writing, stating the reasons

[[Page 6360]]

for such decision, as promptly as circumstances allow. If there is a 
conflict as to any material fact, a hearing must be held to resolve 
such conflict. Rules of practice concerning such a hearing will be 
adopted by the Administrator. The cancellation of the controlled pre-
stamping privilege will be in effect until there is a final 
determination of the preceding.


Sec.  590.945  Eggs and egg products offered for entry; reporting of 
findings to customs; handling of articles refused entry; appeals, how 
made; denaturing procedures.

    (a)(1) Official program personnel must report their findings as to 
any product that has been inspected in accordance with this subpart to 
the Director of Customs at the original port of entry where the same is 
offered for clearance through Customs inspection.
    (2) When product is refused entry into the United States, the 
official mark to be applied to the product refused entry must be in the 
following form:
[GRAPHIC] [TIFF OMITTED] TP13FE18.003

    (3) When product has been identified as ``U.S. Refused Entry,'' 
official program personnel must request the Director of Customs to 
refuse admission of such product and to direct that it be exported by 
the owner or importer within the time specified in this section, unless 
the owner or importer, within the specified time, causes it to be 
destroyed by disposing of it under the supervision of official program 
personnel so that the product can no longer be used as human food, or 
by converting it to animal food uses, if permitted by the Food and Drug 
Administration. The owner or importer of the refused entry product must 
not transfer legal title to such product, except to a foreign importer 
for direct and immediate exportation, or to an end user, e.g., an 
animal food manufacturer or a renderer, for destruction for human food 
purposes. ``Refused entry'' product must be delivered to and used by 
the manufacturer or renderer within the 45-day time limit provided in 
paragraph (a)(4) of this section. Even if such title is illegally 
transferred, the subsequent purchaser will still be required to export 
the product or have it destroyed under paragraph (a)(4) of this 
section.
    (4) The owner or importer will have 45 days after notice is given 
by FSIS to the Director of Customs at the original port of entry to 
take the action required in paragraph (a)(3) of this section for 
``refused entry'' product. An extension beyond the 45-day period may be 
granted by the Administrator when extreme circumstances warrant it, 
e.g., a dock workers' strike or an unforeseeable vessel delay.
    (5) If the owner or importer fails to take the required action 
within the time specified under paragraph (a)(4) of this section, the 
Department will take such actions as may be necessary to effectuate its 
order to have the product destroyed for human food purposes. The 
Department will seek court costs and fees, storage, and proper expenses 
in the appropriate forum.
    (6) No egg product that has been refused entry and exported to 
another country pursuant to paragraph (a)(3) of this section may be 
returned to the United States under any circumstances. Any such product 
so returned to the United States will be subject to administrative 
detention in accordance with section 1048 of the Act and seizure and 
condemnation in accordance with section 1049 of the Act.
    (7) Egg products that have been refused entry solely because of 
misbranding may be brought into compliance with the requirements of 
this chapter under the supervision of an authorized representative of 
the Administrator.
    (b) Upon the request of the Director of Customs at the port where 
an egg product is offered for clearance through the customs, the 
importer of the product must, at the importer's own expense, 
immediately return to the Director any product that has been delivered 
to the importer under this subpart and subsequently designated ``U.S. 
Refused Entry'' or found in any request not to comply with the 
requirements in this part.
    (c) Except as provided in Sec.  590.930(a) or (b), no person will 
remove or cause to be removed from any place designated as the place of 
inspection of egg products that the regulations in this part require to 
be identified in any way, unless the same has been clearly and legibly 
identified in compliance with this part.
    (d) Any person receiving inspection services may, if dissatisfied 
with any decision of an inspector relating to any inspection, file an 
appeal from such decision. Any such appeal from a decision of an 
inspector must be made to the inspector's immediate supervisor having 
jurisdiction over the subject matter of the appeal, and such supervisor 
must determine whether the inspector's decision was correct. Review of 
such an appeal determination, when requested, must be made by the 
immediate supervisor of the Department employee making the appeal 
determination. The egg products involved in any appeal must be 
identified by U.S. retained tags and segregated in a manner approved by 
the inspector pending completion of an appeal inspection.
    (e) All loss or inedible eggs, or inedible egg products must be 
disposed of in accordance with Sec.  590.504(c)(1).


Sec.  590.950  Labeling of immediate containers of egg products offered 
for entry.

    (a) Immediate containers of product offered for entry into the 
United States must bear a label, printed in English, showing:
    (1) The name of the product;
    (2) The name of the country of origin of the product, and for 
consumer packaged products, preceded by the words ``Product of,'' which 
statement must appear immediately under the name of the product;
    (3) [Reserved];

[[Page 6361]]

    (4) The word ``Ingredients'' followed by a list of the ingredients 
in order of descending proportions by weight;
    (5) The name and place of business of the manufacturer, packer, or 
distributor, qualified by a phrase which reveals the connection that 
such person has with the product;
    (6) An accurate statement of the quantity;
    (7) The inspection mark of the country of origin;
    (8) Plant number of the plant at which the egg products were 
processed; and
    (9) The date of production and plant number of the plant at which 
the egg products were processed or packed.
    (b) For properly sealed and certified shipments of shell eggs for 
breaking at an official plant, the immediate containers need not be 
labeled, provided that the shipment is segregated and controlled upon 
arrival at the destination breaking plant.
    (c) The labels must not be false or misleading in any respect.


Sec.  590.955  Labeling of shipping containers of egg products offered 
for entry.

    Shipping containers of imported egg products are required to bear 
in a prominent and legible manner the name of the product, the name of 
the country of origin, the foreign inspection system plant number of 
the plant in which the product was processed, shipping or 
identification marks, production codes, and the inspection mark of the 
country or origin. Labeling on shipping containers must be examined at 
the time of inspection in the United States and if found to be false or 
misleading, the product must be refused entry.


Sec.  590.956  Relabeling of imported egg products.

    (a) Egg products eligible for importation may be relabeled with an 
approved label under the supervision of an inspector at an official 
plant or official import inspection establishment. The new label for 
such product must indicate the country of origin, except for egg 
products that are processed (repasteurized or, in the case of dried 
product, dry blended with product produced in the United States) in an 
official plant.
    (b) Egg products that have been refused entry into the United 
States solely because of misbranding may be brought into compliance 
with the labeling requirements of this chapter.
    (c) The label for relabeled products must state the name, address, 
and zip code of the distributor, qualified by an appropriate term such 
as ``packed for'', ``distributed by'', or ``distributors''.


Sec.  590.960  Small importations for importer's personal use, display, 
or laboratory analysis.

    Egg products (other than those that are forbidden entry by other 
Federal law or regulation) from any country, that are exclusively for 
the importer's personal use, display, or laboratory analysis, and not 
for sale or distribution; that are sound, healthful, wholesome, and fit 
for human food; and that are not adulterated and do not contain any 
substance not permitted by the Act or regulations, may be admitted into 
the United States without a foreign inspection certificate. Such 
products are not required to be inspected upon arrival in the United 
States and may be shipped to the importer without further restriction 
under this part, except as provided in 9 CFR 590.925(b), provided that 
the Department may, with respect to any specific importation, require 
that the importer certify that such product is exclusively for said 
importer's personal use, display, or laboratory analysis and not for 
sale or distribution. The amount of liquid, frozen, or dried egg 
products imported must not exceed 50 pounds.


Sec.  590.965  Returned to the United States inspected and identified 
covered products; exemption.

    U.S. inspected and passed and so marked egg products exported to 
and returned from foreign countries will be admitted into the United 
States without compliance with this part upon notification to and 
approval of the Food Safety and Inspection Service, in specific cases.

SUBCHAPTER I--EGG PRODUCTS INSPECTION ACT

0
74. Add part 591 to read as follows:

PART 591--SANITATION REQUIREMENTS AND HAZARD ANALYSIS AND CRITICIAL 
CONTROL POINT SYSTEMS

Sec.
591.1 Basic requirements.
591.2 Hazard analysis and HACCP plan.

    Authority:  21 U.S.C. 1031-1056; 7 CFR 2.18, 2.53.


Sec.  591.1  Basic requirements.

    (a) All official plants must comply with the requirements contained 
in 9 CFR parts 416, Sanitation, and 417, Hazard Analysis and Critical 
Control Point (HACCP) Systems, except as otherwise provided in this 
chapter.
    (b) For the purposes of 9 CFR parts 416, Sanitation, 417, Hazard 
Analysis and Critical Control Point (HACCP) Systems, and 500, Rules of 
Practice, an official establishment or establishment includes an 
official plant.


Sec.  591.2  Hazard analysis and HACCP plan.

    Pursuant to 21 U.S.C. 1035 and 1043, the failure of an official 
plant to develop and implement a HACCP plan that complies with 9 CFR 
part 417, or to operate in accordance with the requirements in this 
part, may render the products produced under those conditions 
adulterated.

    Done at Washington, DC, on: January 9, 2018.
Paul Kiecker,
Acting Administrator.
[FR Doc. 2018-00425 Filed 2-12-18; 8:45 am]
 BILLING CODE 3410-DM-P