Food importers might want to brace themselves: They need to get ready to plow through thousands of pages of new regulations, help foreign suppliers prepare facilities and operations for new rules, make sure they aren’t legally responsible for mistakes made by foreign suppliers and perhaps open their wallets for steep user fees.
Food and Drug Administration officials in April said the agency would publish regulations by the end of the year to implement the import portion of the Food Safety Modernization Act.
In the 28 months since the bill was signed into law, the FDA has managed to implement two of the requirements set forth in the law. One measure made it easier for the FDA to halt shipments of domestically produced food that may be contaminated and force recalls; the other requires importers to notify the FDA if other countries have rejected food entering the U.S.
The agency’s slow pace and missed statutory deadlines infuriated consumer safety groups, several of which sued the FDA in federal court last August. A judge in April ruled the delays were illegal and ordered the FDA to meet with the Center for Food Safety and the Center for Environmental Health to agree on proposed new deadlines to be submitted to the court by May 20.
“It’s fine that the judge said that, but eventually the regs have to make sense,” international trade lawyer Susan Kohn Ross said. “If they just put some regs out, the FDA will be back in court facing challenges.”
But even before the court decision, the FDA had been signaling it was changing the way food imports would be handled, relying more on having foreign food facilities and operations evaluated and less on direct physical inspections at ports of entry.
“Congress has been quite clear that they wanted more inspections to take place, especially more foreign inspections,” said Edgar Asebey, executive director of FDA Solutions Group, a Florida-based regulatory compliance company. “In 2010, the FDA conducted 357 foreign inspections out of more than 200,000 facilities overseas registered with the FDA. The agency’s goal for 2011 was 600 foreign inspections, and it did over 900. Last year’s goal was 1,200, and they exceeded that goal.”
In fact, even with this year’s government-wide budget cuts, the FDA is continuing foreign inspections. In June, inspectors are scheduled to visit shrimp farms and processing plants in Bangladesh.
Officials said the team would inspect the procedures at three plants with the audits to include traceability, use of antibiotics and chemicals, as well as labor rights issues. The companies could be banned from exporting to the U.S. if they fail the audits and don’t meet deadlines to fix any problems found.
Because of the sheer volume of imported food, however, FDA officials say direct inspections won’t be the only, or even the main, component to securing a safe food supply.
Two of the proposed regulations to be released later this year are the foreign supplier verification program and the voluntary qualified importer program. Under the former, licensed third-party auditors would do annual inspections of foreign facilities. The voluntary qualified importer program is modeled after Customs’ C-TPAT program, and would require importers to jump through additional paperwork hoops and over regulatory hurdles to win preferential treatment at the port of entry.
Michael Taylor, the FDA’s deputy commissioner of foods and veterinary medicine, has said those two programs are part of the agency’s shift from reaction to prevention.
With physical inspections at ports of entry, problem shipments can be kept out of the country, but the FDA faces overwhelming odds in finding problem shipments when only about 1 percent of imports are screened.
Instead, Taylor said the new law shifts the responsibility to the importer — requiring that person or entity to verify that food is grown and processed properly. Under the new law, the importer — not the company that grew, processed or sold tainted food — is legally liable for food safety.
Asebey is telling his clients they should work with their overseas suppliers now to make sure they are ready for the new requirements. “If you have to have a HACCP (Hazard Analysis and Critical Control Point) plan, you have to know what that means,” he said. “If you are buying fresh produce from a market in Guatemala, you need to make sure your supplier is familiar with HACCP requirements. When you think of what is being asked, two to three years really isn’t much time to get ready.”
But Ross said there are still too many unknowns for companies to go to suppliers with regulatory instructions. “There are so many pieces to the puzzle that most importers don’t know what to suggest to the foreign suppliers,” she said. “We really need to see what the FDA comes up with first with the proposed rules.”
Before the law was passed, forwarders and brokers were often the U.S. agents of record for foreign suppliers, a designation that existed only on paper. But because the law shifts legal liability from suppliers to the importers, Asebey said, “Smart freight forwarders and brokers do not allow foreign companies to list them as the agents of record.”
The FDA Solutions Group is among a handful of companies created to be a U.S. agent of record. “We’re set up with insurance, procedures, requirements and contracts to safeguard us legally and help the suppliers do things correctly,” Asebey said.
The Obama administration’s 2014 FDA budget asks for an increase of $295.8 billion to implement the new food safety law, but Congress would have to come up with only $43.4 million of the total. The remaining $252.4 million would be in the form of user fees, mainly on imports.
A coalition of 54 farm, food and beverage groups wrote to the Senate Appropriations Committee asking that such user fees be dropped because they’re too burdensome to the industry. So far, industry lobbying has been able to block collection of such fees.
Ross, however, believes Congress might allow them this time. “I think the idea might sell if the FDA is careful how it defines actions and events that trigger the user fees,” she said. “The possibility is there in the law, so I have a feeling we will see some form of user fees put in place.”
Contact Stephanie Nall at email@example.com.