Lauren Perez

In the Federal Register of October 10, 2003, the Food and Drug Administration issued interim final food regulations implementing the Bioterrorism Act of 2002. These regulations, detailing requirements and procedures for food facility registration and submission of prior notice to FDA providing detailed information about every individual article of food or beverage arriving at a United States port, reflect FDA’s response to nearly 500 comments received after publication of proposed rules on February 3, 2003.

The interim regulations remain in fluid form—comments will be accepted through December 24, 2003, and for an additional 30-day period starting in March 2004 to provide for comments reflecting real-practice concerns and feedback. It is critical that the food industry respond to these interim regulations to ensure that, most important, small domestic businesses are not sacrificed in the wake of overwhelming security regulations.

The prior notice and facility registration requirements will require substantial changes in business operations for nearly all participants in the global food supply chain. Registration by December 12, 2003, is required for all food and beverage facilities located anywhere in the world that manufacture, process, pack, or hold food for consumption in the U.S., even if at the time of manufacture consumption in the U.S. is only a mere possibility.

The definition of food was narrowed in these interim regulations but is still broad enough to include food ingredients, additives, colors, alcoholic beverages, drinking water, dietary supplements, and even live animals and pet food.

All facilities located outside the U.S. must appoint a U.S. agent for their registration to be complete and their products to be allowed entry into the marketplace. For international traders, this reflects a new cost of doing business that may eliminate certain supplies of imported food articles, force the use of alternative, more-expensive sources of food products for domestic food distributors, and ultimately cause dramatic increases in the cost of imported food articles for U.S. consumers.

In addition, the requirements for prior notice submission have been substantially changed. For example, prior notice must be submitted no more than 2 hours before arrival for food shipped by road, 4 hours before arrival for food shipped by rail or air, and 8 hours before arrival for vessel cargo.

Prior notice—notice provided to FDA about each individual food or beverage article arriving at a U.S. port prior to such arrival—must include information about the grower, importer, manufacturer, shipper, and consignee, as well as entry, product, shipment, arrival, and quantity estimates. A separate prior notice is required for each separate food item within the shipment.

The submitter of the prior notice, who will assume liability for the information provided therein, may authorize anyone else to transmit the actual information to FDA. Prior notice may be submitted either through the existing Bureau of Customs and Border Protection (CBP) systems or through FDA’s own prior notice submission system, although existing users of CBP systems will have to implement certain changes to their systems to satisfactorily transmit the additional information now required prior to arrival.

In effect, every food article arriving at a U.S. port, whether imported or for future export, must first await FDA release for sufficiency of prior notice and, if being imported, must then await release from CBP and FDA after a subsequent determination of admissibility has been made. Fears that this system will lead to increased entry delays, port congestion, and unmarketable food product are certainly understandable.

The worst and most unacceptable reaction to the regulations is to do nothing at all. The anticipated business impact of these regulations must be made known to FDA, and the agency must be convinced that security will not be sacrificed by final regulations more respectful of its nation’s role as a leader, especially in hemispheric trade. Traders in the global food industry have until December 24, 2003, to provide FDA with suggestions on how the agency may better protect the industry while still meeting its obligations under the Bioterrorism Act. In this regard, FDA has specifically requested information about the impact of these regulations on small domestic businesses.

Affected businesses must work quickly to facilitate compliance with these regulations, because, as of December 12, 2003, these rules are the law. All required food and beverage facilities must be registered with FDA by December 12, 2003, U.S. agents must be engaged by all such facilities located outside the U.S., and all international food businesses must prepare for prior notice submission by redrafting vendor agreements, bills of lading, and similar existing business practices. All supply chain participants are now necessarily close business partners, and the partnership will necessarily fail without open communication and education.

These regulations are, without a doubt, an improvement over those published earlier this year; but we can make them even better.

by Lauren V. Perez is International Trade Advisor with the law firm of Sandler, Travis & Rosenberg, P.A., 5200 Blue Lagoon Dr., Miami, FL 33126, e-mail: [email protected].