Some in the perishables industry already are talking about lawsuits as the Food and Drug Administration rolls out new fees for inspections of some imported foods.
“In January, it’s going to hit the fan when companies start getting these invoices from the FDA,” said Benjamin England, who was an attorney at the FDA for 17 years. “The FDA is starting to impose these fees now, but it’s going to take a few months for the invoices to roll in and get moved up the chain to executives. Then the fun will really start.”
The FDA said in a Federal Register notice late last month it will start tracking, assessing and collecting reinspection fees related to domestic and foreign facilities and fees charged companies that refuse to issue recall orders. But the FDA doesn’t intend to send out any of the invoices before Jan. 1. That means there could be surprised, confused and angry companies, England said.
The Food Safety and Modernization Act enacted this year requires the FDA to conduct two examinations of imported food before the agency is authorized to charge a fee for services related to the second and subsequent examinations.
England, president of import consulting company FDAimports.com, said the agency is including too many actions in what it considers a reinspection.
“Unfortunately for importers, FDA has so broadly defined what constitutes the ‘first examination’ that virtually every imported food shipment detained for an apparent food safety reason will become subject to the new FDA re-examination fee,” England said.
FDA lists four examples of when the importer can expect to pay a fee.
-- When a food is reconditioned or relabeled to address a food safety concern.
-- When an importer is seeking release of an imported food that the FDA has detained — even for FDA automatic detentions.
-- When an importer or foreign food manufacturer petitions to request removal from FDA import alert status.
-- When the FDA supervises destruction of FDA refused cargo.
If the FDA undertakes any of those actions, the agency will bill the shipper $224 per hour.
England is organizing a coalition of companies to challenge the fees at a legislative and administrative level. But he said other shippers and lawyers are considering filing a lawsuit.
Congressional leaders have been vocal in saying they will not give the FDA the sizable budget boost it would take to implement many provisions of the new law. That budget situation is pushing frustrated FDA officials to increase inspection activities that trigger user fees, England said.
“With the new law, we have two import programs being administered by the FDA, one funded by fees and one by tax dollars,” England said. “By necessity, they will shrink the latter and in time end up with a lot more imports inspected under the new fee system. Using that system, they can stop as many shipments as they want because it won’t be a resource drain and will be self-funded.”
He said shippers, receivers, carriers and terminal operators should prepare for dramatic increases in the number of shipments held — something that would increase delays, clog terminals, spark a dramatic jump in inspection fees and also result in an increasing amount of perishable food that spoils as it is held.
“What the FDA is doing is going back to using the border as a revenue source,” he said. “The import community speaks with too many voices, but six or eight months from now, we’ll see a lot more held shipments. If they are perishable shipments, a lot of them will be mush when they’re released. That’s when we’ll start seeing more pushback.” Del Monte Fresh in August successfully pushed back against FDA actions when it filed a rare lawsuit challenging the FDA’s refusal to allow cantaloupes from a farm in Guatemala into the U.S. The import alert followed a salmonella outbreak that the FDA said was connected to Del Monte imports from that farm, which produces 27 percent of the company’s melons. That situation is not connected to the more recent rash of cantaloupes tainted with the listeria virus.
After the FDA approached Del Monte in March, the company agreed to issue a voluntary recall. That allowed the FDA to stop any further imports from that farm. But Del Monte said the FDA provided no more evidence to link the produce to the outbreak. In fact, Del Monte said some of the people were sickened before its melons reached U.S. markets, and another person told health investigators he purchased the melon at a retail outlet that does not stock Del Monte produce.
After the FDA refused to reverse its action and Del Monte filed suit, some consumer groups said Del Monte was using its size to bully the FDA. About a month after the lawsuit was filed, the agency agreed to lift the import alert and Del Monte agreed to withdraw the lawsuit.
Although the new law changes the way the FDA oversees produce imports, it didn’t expand its authority to blacklist suspect produce, according to Gary Kushner, a lawyer with Hogan Lovells in Washington, D.C.
“They’ve always had the power to block imports,” Kushner said. “To the extent the agency has new authority, it should certainly exercise due diligence going forward. The FDA and any government agency always bears the responsibility to ensure that its actions are supported by the facts, the law and public policy.”
The Del Monte melon recall was based entirely on epidemiology, a branch of medical science that deals with the incidence, distribution, and control of disease in a population using statistics and probabilities, a factor Del Monte noted in its lawsuit.
Kushner said it is not always possible to scientifically trace all outbreaks. The new food safety law, however, mandates the agency undertake two studies to further the ability of investigators to trace an outbreak back to its source.
“Traceability is important, but complicated,” Kushner said. “It’s not always possible to trace every commodity back to its origin.” He said he has confidence that the FDA will use its existing and new authority with discretion.
“The advice I’ve given my clients and anyone else over the years is to first and foremost know your supplier and be confident that they are producing a safe product,” Kushner said. “The food industry invented HACCP (Hazard Analysis Critical Control Point) in the 1960s largely to protect the food used in the space program.”
The government later made HACCP a requirement for some food industry sectors. The system requires that companies address the safety of products by analyzing different steps of production and implementing checks and controls to avoid contamination, rather than relying on post-production inspections. The new law expands the number of products covered by the regulations.
“Most companies already have an HACCP plan,” Kushner said. “They are ready for this.”
England said the FDA is approaching implementation in a backward fashion.
“When you’re talking about risk prevention, the industry is already doing it,” England said. “The FDA should establish its qualified importer program first and then find out how the best companies are mitigating risk and benchmark those standards for everyone else to meet.”
Contact Stephanie Nall at email@example.com.