$100,000 or less in annual average monetary value of animal food sold
over the previous 3-year period, adjusted for inflation. Another
comment suggests a threshold of $250,000. Other comments recommend
defining a very small business as one with less than $10,000 in annual
sales believing that a rule encompassing virtually all ingredient and
feed manufacturing and distribution facilities will encourage large
firms to continue to do business with very small firms. One comment
suggested excluding the value of donated by-product in the calculation
of total annual sales of animal food.
    (Response 77) We are establishing a $2,500,000 threshold for the
definition of ``very small business.'' Under section 418(l)(1)(A) and
(B) of the FD&C Act, a very small business is a qualified facility;
under the exemption authorized in section 418(l)(2) of the FD&C Act, a
qualified facility is subject to modified requirements rather than the
requirements for hazard analysis and risk-based preventive controls. We
have acknowledged that a $2,500,000 threshold exempts a greater portion
of the animal food supply than thresholds of either $500,000 or
$1,000,000 (79 FR 58476 at 58502), but reaffirm that under the
$2,500,000 threshold the businesses that would be exempt from the
requirements for hazard analysis and risk-based preventive controls
would represent a small portion of the potential risk of foodborne
illness; businesses that fall within this definition of ``very small
business,'' collectively, produce less than 0.6 percent of the animal
food supply (Ref. 3). In addition, most of these facilities will be
subject to the CGMP requirements in subpart B; the only exemptions from
those CGMP requirements are the exemptions in Sec.  507.5(a) (which
applies to farms and activities of ``farm mixed-type facilities'' that
fall within the definition of ``farm''), and in Sec.  507.5(h) (which
applies to: (1) The holding or transportation of one or more RACs; (2)
hulling, shelling, and drying nuts and hulls (without manufacturing/
processing); and (3) the ginning of cotton (without manufacturing/
processing)). Facilities subject to and in compliance with human food
CGMPs and applicable FDA human food safety requirements that process
human food and ``donate'' or sell the human food by-products without
further processing for use as animal food are only subject to certain
provisions in subpart B for those by-products. This applies whether
they are a qualified facility or not. They are not subject to the
requirements of subparts C and E for the human food by-products used
for animal food.
    (Comment 78) Some comments ask us to only include the total annual
sales of food in the United States, adjusted for inflation, for foreign
facilities that export food to the United States.
    (Response 78) We decline this request. The purpose of the
definition of ``very small business'' is principally to enable such
businesses to comply with modified requirements, because they have
fewer resources to direct to full compliance with the rule. A foreign
business that sells more than the threshold dollar amount of animal
food has more resources than the businesses being excluded, even if
less than that threshold dollar amount reflects sales to the United
States. Likewise, a domestic business that sells more than the
threshold dollar amount of food has more resources than the businesses
being excluded, even if that domestic business exports some of its food
and, as a result, less than that threshold dollar amount reflects sales
within the United States.

    (Comment 79) Some comments ask us to base the threshold on the
total ``volume of product'' or ``amount of product'' handled or sold.
These comments assert that an approach using product volume or amount
would be more risk based because it would correlate more closely to
consumer exposures than dollar amounts, which can be skewed by product
values.
    (Response 79) We acknowledge that dollar amounts can be skewed by
product values but nonetheless disagree that we should base the
threshold on the total ``volume of product'' or ``amount of product''
handled or sold. We see no practical way to identify a threshold based
on volume or amount of product that could be applied across all product
sectors, and the comments provide no suggestions for how their
recommendation could be carried out.
    (Comment 80) Some comments express concern that establishing a
threshold based on U.S. dollars would place domestic firms at a
disadvantage relative to foreign firms whose sales are often
denominated in currencies valued lower than the dollar and often
reflect much lower costs for factors such as land, labor, and
environmental compliance. These comments ask us to base the threshold
on an alternate measure, such as number of employees, or to calculate
the sales of foreign very small businesses using an appropriate measure
of purchasing power parity, if there is a straightforward way to do so.
    (Response 80) We decline these requests. As previously discussed,
we use dollar estimates to evaluate the percent of all food produced in
the United States that would not be covered by the rule (79 FR 58476 at
58502). We acknowledge that the definition of ``small business'' is
based on number of employees, and that two exemptions (i.e., the
exemptions in Sec.  507.5(e) and (f) for on-farm, low-risk activity
animal food combinations) apply to small businesses. However, the
exemptions for on-farm, low-risk activity animal food combinations are
limited to a narrow sector of the animal food industry, whereas the
exemption applicable to a very small business will apply to all sectors
of the animal food industry.
    We do not know of a straightforward way to calculate the sales of
foreign very small businesses using an appropriate measure of
purchasing power parity and, thus, are basing the threshold only on
U.S. dollars.

B. Comments Asking FDA To Establish Additional Definitions or Otherwise
Clarify Terms Not Defined in the Rule

    Some comments ask us to define certain terms such as
``associated,'' ``contaminate,'' ``directly linked,'' ``integrated
operator,'' ``material to the safety of food,'' ``written,'' and
``necessary.'' We believe that it is not necessary to define these and
certain other new terms proposed by the comments. We discuss in this
section of this document comments that ask us to establish other new
terms or clarify terms in the rule not defined.
1. Consumer/Final Consumer/Customer
    (Comment 81) A few comments request that we define consumer as the
animal consuming the food. Some comments ask us to define ``customer''
as the purchaser of the animal food. Other comments ask us to define
``final consumer'' to mean a person that feeds animals under the
control or ownership of that person. The comments suggest ``final
consumer'' could be used in the animal food rule to help clarify the
meaning of qualified end user.
    (Response 81) We decline these requests. We stated that for
purposes of the proposed rule, the term consumer refers to the person
purchasing the animal food to feed to an animal(s), as well as the
animal(s) consuming the food (78 FR 64736 at 64756 through 64757). To
limit the definition of consumer to the animal consuming the food would
be inconsistent with how that term is used throughout FSMA and would
create confusion. Therefore, ``consumer'' also includes the person
purchasing the animal food.
2. Corrections
    (Comment 82) Some comments assert that clearly distinguishing
between the terms ``corrective actions'' and ``corrections'' will be
imperative for industry to comply with the rule and for regulators to
enforce the rule. Some comments ask us to use the ISO definitions of
``corrective actions'' and ``corrections.'' (According to ISO
22000:2005 definition 3.13, a ``correction'' is action to eliminate a
detected non conformity; according to ISO 22000:2005 definition 3.14,
corrective action is action to eliminate the cause of a detected non
conformity or other undesirable situation.) Other comments ask us to
eliminate the term ``correction'' and instead revise the rule to
clarify the type of situation in which ``corrective actions'' are
neither necessary nor appropriate. As an example, these comments
suggest that the proposed provisions for corrections could refer to
``prompt actions taken in response to minor and isolated deviations
that do not directly impact product safety.''
    Other comments agree with the concept of simple ``corrections'' but
assert that the term ``corrections'' is unnecessary and could be
confusing because different facilities may use the term differently.
These comments explain that sometimes ``correction'' is used to refer
to the action taken to fix a deviation, and may or may not be part of
an overall corrective action taken to identify the root cause of the
deviation and to prevent a similar occurrence. These comments suggest
that the provisions explain that prompt actions taken to address minor
and isolated deviations are not subject to the same requirements as
corrective actions to address potentially systemic concerns, without
defining the term ``corrections.''
    (Response 82) We are defining the term ``correction'' to mean an
action to identify and correct a problem that occurred during the
production of animal food, without other actions associated with a
corrective action procedure (such as actions to reduce the likelihood
that the problem will recur, evaluate all affected animal food for
safety, and prevent affected animal food from entering commerce). We
agree that clearly distinguishing between the terms ``corrective
actions'' and ``corrections'' will be important for both industry and
regulators. We acknowledge that one way to distinguish between
``corrective actions'' and actions that we would consider
``corrections'' could be to avoid the term ``corrections'' and instead
say what we mean each time the rule uses the term ``corrections.''
However, after reviewing the full regulatory text of proposed subpart
C, we concluded that it was not practical to do so, because the term
``corrections'' was used more often in a title or a cross-reference
than in a provision where the full text of what we mean by the term
``corrections'' is necessary to communicate a requirement. Our
definition of ``corrections'' focuses on the first step in a
``corrective action procedure'' (i.e., identify and correct the
problem) and also specifies those aspects of a corrective action
procedure that do not apply to a correction (i.e., actions to reduce
the likelihood that the problem will recur, evaluate all affected
animal food for safety, and prevent affected animal food from entering
commerce). (A note to the ISO 22000:2005 definition of corrective
action indicates that it includes cause analysis and is taken to
prevent recurrence.) We believe that this definition will be adequate
to

distinguish ``corrective actions'' from ``corrections.''
    As an example, if a facility applies sanitation controls for an
environmental pathogen such as Salmonella spp. and animal food residue
is observed on ``clean'' equipment prior to production, corrections
would involve re-cleaning and sanitizing the equipment before it is
used. Because the observation of animal food residue was made prior to
production of animal food, no animal food is affected, and no actions
are needed with respect to animal food. Although there are actions that
can be taken to prevent reoccurrence, such as retraining sanitation
personnel, these types of situations may reoccur from time to time.
3. Crop
    (Comment 83) Some comments request we define a new term ``crop'' to
mean the edible or inedible cultivated or harvested plants.
    (Response 83) We decline this request. The term ``crop'' has a
common meaning, and it is not necessary to establish a meaning for this
term in this rule.
4. Establishment
    (Comment 84) Several comments request we establish a definition for
establishment as it is used in the supplier definition. Also, the
comments suggest that we replace in the definition of farm the term
``establishment'' with ``operation.''
    (Response 84) Comments concerning the meaning of the term
``establishment'' as it relates to the ``supplier'' definition are
addressed in section XL pertaining to subpart E, the supply-chain
program. Comments directed to the meaning of the term ``establishment''
as it relates to the farm definition are addressed in section IV.A and
B of the final rule for preventive controls for human food, published
elsewhere in this issue of the Federal Register.
5. Parameter and Value as Used in the Requirements for Process Controls
    (Comment 85) Some comments ask us to define the terms ``parameter''
and ``value'' used in the requirements for preventive controls (Sec.
507.34). These comments ask us to define ``parameter'' as a measurable
attribute and ``value'' as a specific measurement.
    (Response 85) We decline this request. Both of these terms are used
in the context of process controls and both have common meanings when
associated with process controls. Therefore, it is not necessary for
the rule to define them.
6. Prerequisite Program
    (Comment 86) Some comments ask that we adapt the definition of
prerequisite program from the ISO's food safety standard, ISO
22000:2005, noting that the ISO definition is: Basic practices and
procedures in animal food production that are necessary for the
manufacture, handling and provision of safe end products and safe food
for animal consumption.
    (Response 86) We do not use the term ``prerequisite program'' in
the regulations established by this rulemaking and do not find it
necessary to define it. We understand that some facilities may refer to
practices and procedures such as CGMPs, training, or certain controls
for hazards as a ``prerequisite program.''
7. Qualified Facility Exemption
    (Comment 873) Some comments note that some of the terminology
associated with the exemption for qualified facilities in the
preventive controls rule is different from terminology associated with
an exemption in the proposed produce safety rule. These comments point
out that the exemption in the proposed produce safety rule refers to
``qualified exemptions'' (Sec.  112.5), whereas the exemption in the
proposed animal preventive controls rule refers to ``exemptions'' and
``qualified facilities'' (Sec.  507.5(d)).
    (Response 873) We have added a definition for the term ``qualified
facility exemption,'' to mean an exemption applicable to a qualified
facility under Sec.  507.5(d) (see the regulatory text in Sec.  507.3).
We also have made conforming changes throughout the rule to use the
term ``qualified facility exemption'' when it applies. (See table 31).
8. Qualified Investigator
    (Comment 88) Once comment proposes a new term ``qualified
investigator'' where the term ``qualified investigator'' means an FDA
or state commissioned investigator that has successfully completed a
formal training course on inspections; CGMPs; hazard analysis and
preventive controls for animal food facilities, both animal feed and
pet food, and has demonstrated an understanding of the differences
between pet food and animal feed manufacturing facilities.
    (Response 88) We decline this request. Our inspectors will be
trained on the requirements of this part.
9. Reanalysis
    (Comment 89) Some comments request we define the term reanalysis to
mean a reassessment of the validity of a preventive control or food
safety plan to control a hazard.
    (Response 89) We decline this request. Section 418(i) of the FD&C
Act sets the requirement for conducting a reanalysis, which is in the
regulatory text in Sec.  507.50, including how often and under what
circumstances a reanalysis of the food safety plan must be performed,
and how to handle the results. Therefore, we have determined that a
definition of ``reanalysis'' is not necessary. For a discussion of the
reanalysis requirement, see section XXXV.
10. Risk Assessment
    (Comment 90) Some comments request that we add a new term ``risk
assessment'' and define this term as a scientifically based process
consisting of hazard identification, hazard characterization, exposure
assessment, and risk characterization.
    (Response 90) We do not use the term ``risk assessment'' in the
regulations established by this rulemaking and do not find it necessary
to define it. As directed by section 103(c) of FSMA, we issued for
public comment a draft risk assessment, as described in section I.D and
are including the final risk assessment in the docket established for
this rule.
    The definition proposed by the comment is similar to the
requirements for the hazard analysis of Sec.  507.33. The term ``hazard
analysis'' comes from section 418 of the FD&C Act. For discussion of
hazard analysis, see section XXV.
11. Undesirable Microorganisms
    (Comment 91) Some comments request we define a new term
``undesirable microorganisms'' as those microorganisms that are of
animal or human health significance, thereby rendering the animal food
unfit for consumption or distribution.
    (Response 91) We decline this request. See Response 45.
12. Unexposed Packaged Animal Food
    As discussed in section XXXVI, some comments ask us to clarify that
modified requirements for packaged animal food that is not exposed to
the environment only apply to such animal food that requires time/
temperature controls for safety (TCS animal food). To do so, we are
defining the term ``unexposed packaged animal food'' to mean packaged
animal food that is not exposed to the environment and using this term
throughout the rule. Doing so simplifies the regulatory text and makes
it clearer.

C. Additional Definitions To Clarify Terms Not Defined in the Proposed
Rule

1. Audit
    As already noted, some comments ask us to make the various rules we
are establishing to implement FSMA consistent with each other, and we
have worked to align the provisions of this rule with the provisions of
the FSVP rule to the extent practicable. (See Comment 4 and Response
4.) To align these provisions, we are establishing in this final rule a
definition of ``audit'' analogous to the definition of ``audit'' we
proposed for the FSVP rule. For the purposes of this rule, ``audit''
means the systematic, independent, and documented examination (through
observation, investigation, records review, discussions with employees
of the audited entity, and, as appropriate, sampling and laboratory
analysis) to assess a supplier's food safety processes and procedures.
2. Full-Time Equivalent Employee
    As discussed in Response 70, we have established a definition for
``full-time equivalent employee'' as a term used to represent the
number of employees of a business entity for the purpose of determining
whether the business qualifies for the small business exemption. The
number of full-time equivalent employees is determined by dividing the
total number of hours of salary or wages paid directly to employees of
the business entity and of all of its subsidiaries and affiliates by
the number of hours of work in 1 year, 2,080 hours (i.e., 40 hours x 52
weeks). If the result is not a whole number, round down to the next
lowest whole number.
3. Qualified Individual
    As discussed in section IX.A, we are clarifying in new Sec.
507.4(b)(1) that each individual engaged in manufacturing, processing,
packing, or holding animal food (including temporary and seasonal
personnel) or in the supervision thereof must have the education,
training, or experience (or combination thereof) necessary to
manufacture, process, pack, or hold safe animal food as appropriate to
the individual's assigned duties. To better align with the FSVP rule,
we use the term ``qualified individual'' in new Sec.  507.4 and are
defining the term ``qualified individual'' to mean a person who has the
education, training, or experience (or a combination thereof) necessary
to manufacture, process, pack, or hold safe animal food as appropriate
to the individuals assigned duties. A qualified individual may be, but
is not required to be, an employee of the establishment.
4. Raw Agricultural Commodity
    We have added a definition of the term ``raw agricultural
commodity'' to have the meaning given in section 201(r) of the FD&C
Act. We decided to define this term in the rule to simplify the
provisions in part 507 that refer to raw agricultural commodities.
5. Supply-Chain-Applied Control
    We have added a definition of the term ``supply-chain-applied
control'' to mean a preventive control for a hazard in a raw material
or other ingredient when the hazard in the raw material or other
ingredient is controlled before its receipt. We decided to define this
term in the rule to simplify the provisions in part 507, and in this
document, that refer to preventive controls applied by a supplier
before receipt by a receiving facility.
6. Written Procedures for Receiving Raw Materials and Other Ingredients
    We have added a definition of the term ``written procedures for
receiving raw materials and other ingredients'' to mean written
procedures to ensure that raw materials and other ingredients are
received only from suppliers approved by the receiving facility (or,
when necessary and appropriate, on a temporary basis from unapproved
suppliers whose raw materials or other ingredients are subjected to
adequate verification activities before acceptance for use). We decided
to define this term in the rule to simplify the provisions in part 507,
and in this document, that refer to these procedures.

IX. Subpart A: Comments on Qualifications of Individuals Who
Manufacture, Process, Pack, or Hold Animal Food

    In the 2013 proposed preventive controls rule for animal food we
proposed that personnel responsible for identifying sanitation failures
or animal food contamination should have a background of education or
experience, or a combination thereof, to provide a level of competency
necessary for production of clean and safe animal food. Animal food
handlers and supervisors should receive appropriate training in proper
food handling techniques and food-protection principles and should be
informed of the danger of poor personal hygiene and insanitary
practices. We asked if the recommendations should be requirements for
employee education and training (78 FR 64736 at 64778). In addition, we
requested comment on how best to implement section 418(o)(3) of the
FD&C Act and the recommendations of the CGMP Working Group for human
food with respect to training (78 FR 64736 at 64778). We requested
comment on whether the rule should specify that each person engaged in
animal food manufacturing, processing, packing, or holding (including
temporary and seasonal personnel and supervisors) must receive training
as appropriate to the person's duties; specifying the frequency of
training (e.g., upon hiring and periodically thereafter); specify that
training include the principles of animal food hygiene and animal food
safety, including the importance of employee health and personal
hygiene, as applied at the facility; and specify that records document
required training of personnel and, if so, specify minimum requirements
for the documentation (e.g., the date of the training, the type of
training, and the person(s) trained). We also requested comment on
whether to establish some or all of the potential requirements for
education and training in subpart B, subpart C, or both.
    In the following paragraphs, we discuss comments that respond to
our requests for comment on potential requirements for education and
training and whether to establish any requirements in subpart B,
subpart C, or both. After considering these comments, we are
establishing requirements for the qualifications of individuals engaged
in manufacturing, processing, packing, or holding animal food, as well
as the associated recordkeeping requirements in new Sec.  507.4 in
subpart A. The regulatory text makes clear that these requirements,
established in subpart A, apply to individuals engaged in
manufacturing, processing, packing, or holding animal food regardless
of whether the individuals conduct these activities under the framework
of the CGMPs established in subpart B or the framework for hazard
analysis and risk-based preventive controls established in subparts C,
D, and E. The regulatory text also makes clear that the qualification
requirements apply to the recordkeeping requirements of subpart F. See
table 5 for a description of these provisions.

 Table 5--Provisions for Qualifications of Individuals Who Manufacture,
                    Process, Pack or Hold Animal Food
------------------------------------------------------------------------
                                    Proposed
   Final section designation         section           Description
                                   designation
------------------------------------------------------------------------
507.4(a)(1)....................             N/A  Applicability to
                                                  individuals who
                                                  manufacture, process,
                                                  pack, or hold animal
                                                  food subject to
                                                  subparts B and F.
507.4(a)(2)....................             N/A  Applicability to
                                                  individuals who
                                                  manufacture, process,
                                                  pack, or hold animal
                                                  food subject to
                                                  subparts C, D, E, or
                                                  F.
507.4(b)(1)....................       507.14(b)  Each individual engaged
                                                  in manufacturing,
                                                  processing, packing,
                                                  or holding animal food
                                                  must have the
                                                  education, training,
                                                  or experience (or
                                                  combination thereof)
                                                  necessary to
                                                  manufacture, process,
                                                  pack, or hold safe
                                                  animal food as
                                                  appropriate to the
                                                  individual's assigned
                                                  duties.
507.4(b)(2)....................       507.14(b)  Required training in
                                                  the principles of
                                                  animal food hygiene
                                                  and animal food
                                                  safety, including the
                                                  importance of employee
                                                  health and personal
                                                  hygiene.
507.4(c).......................       507.14(c)  Additional
                                                  qualifications of
                                                  supervisory personnel.
507.4(d).......................        507.4(d)  Records of required
                                                  training. The required
                                                  records are subject to
                                                  the recordkeeping
                                                  requirements of
                                                  subpart F.
------------------------------------------------------------------------

A. Applicability and Qualifications of All Individuals Engaged in
Manufacturing, Processing, Packing, or Holding Animal Food (Final Sec.
507.4(a), (b), and (d))

    (Comment 92) Some comments prefer that we continue to only provide
recommendations for education and training and allow the animal food
industry to determine the appropriate level of specific employee
training that may be needed. Some comments say that we should allow
facilities to conduct employee training in a flexible manner, with the
facility determining the training content and frequency that is
appropriate for the duties of a given employee as they relate to
ensuring the safe production and distribution of animal food.
    Some comments recommend that employees be trained ``initially'' and
``periodically thereafter'' but ask that we recognize the seasonal
nature of a facility's workforce. Some comments ask that the training
include the principles of animal food hygiene and animal food safety,
including the importance of employee health and personal hygiene as
applied at the facility.
    Some comments ask that training requirements be established in
subpart B so that the requirements would also apply to establishments
that manufacture, process, pack, or hold animal food, including
establishments that are not subject to FSMA's requirements for hazard
analysis and risk-based preventive controls. Some comments that
recommend establishing the training requirement in subpart B assert
that training is more appropriately considered a prerequisite program
than a preventive control that would belong in subpart C.
    Other comments ask that the training and related recordkeeping
requirements for the facility's preventive controls qualified
individuals be established under subpart C because this is directly
related to the facility's food safety plan. Other comments ask that
training requirements be established in both subpart B and subpart C.
Other comments say that including requirements for education and
training in both subparts B and C would be confusing.
    (Response 92) We are establishing a series of requirements for the
qualifications of individuals engaged in manufacturing, processing,
packing, or holding animal food in new Sec.  507.4. First, to clarify
how these qualification requirements apply to establishments subject to
subparts B and F, we are requiring that the management of an
establishment ensure that all individuals who manufacture, process,
pack, or hold animal food subject to subparts B and F are qualified to
perform their assigned duties (Sec.  507.4(a)(1)). To clarify how these
qualification requirements apply to facilities, we are requiring that
the owner, operator, or agent in charge of a facility must ensure that
all individuals who manufacture, process, pack, or hold animal food
subject to subparts C, D, E, or F are qualified to perform their
assigned duties (Sec.  507.4(a)(2)).
    We are not requiring training specific to the person's assigned
duties. Each establishment engaged in the manufacturing, processing,
packing and holding of food for animal consumption would already have
procedures in place to ensure that all individuals who manufacture,
process, pack, or hold animal food know how to do their jobs. However,
to emphasize that we expect all individuals who conduct such activities
to know how to do their jobs, we are specifying that each individual
engaged in manufacturing, processing, packing, or holding animal food
(including temporary and seasonal personnel) or in the supervision
thereof must have the education, training, or experience (or
combination thereof) necessary to manufacture, process, pack, or hold
safe animal food as appropriate to the individual's assigned duties
(Sec.  507.4(b)(1)). To better align with the forthcoming FSVP rule, we
are using the term ``qualified individual'' in new Sec.  507.4(b)(1)
and are defining the term ``qualified individual'' to mean a person who
has the education, training, or experience (or combination thereof)
necessary to manufacture, process, pack, or hold safe animal food as
appropriate to the individual's assigned duties. A qualified individual
may be, but is not required to be, an employee of the establishment.
See the discussion of the term ``preventive controls qualified
individual'' in section VIII.A.10, including a discussion of how we
have changed the proposed term ``qualified individual'' to ``preventive
controls qualified individual'' because we are establishing a new
definition for ``qualified individual,'' with a meaning distinct from
``preventive controls qualified individual.''
    We also are requiring that each individual engaged in
manufacturing, processing, packing, or holding animal food (including
temporary and seasonal personnel) or in the supervision thereof,
receive training in the principles of animal food hygiene and animal
food safety, including the importance of employee health and personal
hygiene, as appropriate to the animal food, the facility and the
person's assigned duties (see Sec.  507.4(b)(2)). Records that document
this required training must be established and maintained and are
subject to the recordkeeping requirements of subpart F (Sec.
507.4(d)). The rule does not specify the frequency

of the required training. We expect that production employees will
receive training before working in production operations. We expect
that most facilities will also provide some form of refresher training.
    We disagree that we should continue to only provide recommendations
for education and training. Although the comments express concern about
overly prescriptive requirements that may not consider variables that
would affect an establishment's training program (such as training
course content, training provider, effectiveness of the course and
instructor and frequency of training per topic, an employee's type and
length of experience, nature of formal education, and the animal food
product type and point in the animal food supply chain at which the
employee works with the animal food product), the training requirement
we are establishing in the rule provides flexibility for each
establishment to provide training, and determine the scope and
frequency of the training, in a way that works best for the
establishment.
    We agree that it is appropriate to establish training requirements
so that the requirements apply to all establishments that manufacture,
process, pack, or hold animal food, including establishments that are
not subject to FSMA's requirements for hazard analysis and risk-based
preventive controls, and we are establishing the qualification and
training requirements in subpart A to clarify the applicability of
these requirements to all establishments and facilities subject to part
507. Although we agree that employees in facilities that are subject to
the requirements for hazard analysis and risk-based preventive controls
need to understand their responsibilities under the facility's food
safety plan, we are setting forth a training requirement focused on the
principles of animal food hygiene and animal food safety. We consider
training in the principles of animal food hygiene and animal food
safety, including the importance of employee health and personal
hygiene, to be fundamental to the concept of CGMPs. We agree that
establishing a training requirement in both subpart B and subpart C
could be confusing.
    (Comment 93) Some comments agree that training should be documented
and assert that those records should show the date of training, a
description of the training, and the name of the person trained.
However, comments ask that we allow flexibility in the way these
records are kept. Other comments assert that requiring that records
document required training of personnel is burdensome, arbitrary, and
capricious.
    (Response 93) The rule requires that records that document training
required by Sec.  507.4(b)(2) be established and maintained without
prescribing any content of those records. Although one approach to
documenting training would be to provide the date of training, a
description of the training, and the name of the person trained, the
rule provides flexibility for each establishment to document its
training in a way that works best for that establishment. We disagree
that requiring records to document required training is burdensome,
arbitrary, and capricious in light of the flexibility provided by the
rule for the content of training records.
    (Comment 94) Some comments agree that any requirements should
include training appropriate to the person's duties but emphasize that
the decision as to what is appropriate to the person's assigned duties
should be determined by the establishment.
    (Response 94) The requirement for employees to receive training in
the principles of animal food hygiene and animal food safety, including
the importance of employee health and personal hygiene, as appropriate
to the person's assigned duties, provides flexibility for the
establishment to provide training that is appropriate for its employees
in light of each person's assigned duties. However, the rule does not
require training specific to the person's assigned duties.
    (Comment 95) Some comments assert that the training requirement
would be an unreasonable burden for small businesses and that companies
may incur substantial cost for the time that workers would be in
training rather than in production. Some comments ask us to provide
non-specific training recommendations for smaller processors that need
flexibility to control the cost of training. Some comments assert that
the training and education requirements must be accessible and flexible
enough to allow employers to bring in temporary help when demand is
high without causing a delay in hiring.
    (Response 95) All employees will need enough training to do their
job and understand the importance of hygiene for animal food safety.
The training offered does not need to be expensive (e.g., offsite
training or off-the-shelf purchased training) and we expect that much
of the training will be provided in-house by knowledgeable employees.
As discussed in Response 1, the FSPCA is developing a preventive
controls training curriculum. These training materials will be
available online, and we expect these training materials to be useful
to small businesses to use for in-house training.

B. Additional Requirements Applicable to Supervisory Personnel (Final
Sec.  507.4(c))

    We proposed that responsibility for ensuring compliance by all
personnel with all requirements of this subpart must be clearly
assigned to competent supervisory personnel in Sec.  507.14(c). We are
finalizing this provision in Sec.  507.4(c). We are correcting ``all
requirements of this subpart'' to ``all requirements of this part.'' As
a conforming change for consistency with the provisions of Sec.
507.4(b), we are replacing the phrase ``competent supervisory
personnel'' with the phrase ``supervisory personnel who have the
education, training, or experience (or a combination thereof) necessary
to supervise the production safe animal food.''

X. Subpart A: Comments on Proposed Sec.  507.5--Exemptions

    We proposed to establish a series of exemptions from the
requirements for hazard analysis and preventive controls that would be
established in subpart C, with modified requirements in some cases.
    Some comments support one or more of the proposed exemptions
without change. For example, some comments note that the exemptions are
specified in FSMA and, thus, reflect the intent of Congress. Some
comments state that some exemptions (i.e., those for products already
subject to our regulations for the control of microbiological hazards
for low-acid canned foods (LACF)) make sense because they are risk-
based. Other comments that support one or more of the proposed
exemptions ask us to clarify particulars associated with these
exemptions or expand the scope of some of these exemptions. Other
comments ask us to include additional exemptions in the rule.
    In the remainder of this section, we discuss comments that ask us
to clarify the proposed exemptions or that disagree with, or suggest
one or more changes to, the proposed exemptions. We also discuss
comments that ask us to include additional exemptions in the rule.
After considering these comments, we have revised the proposed
exemptions as shown in table 6 with editorial and conforming changes as
shown in table 31. A key conforming change that affects all proposed
exemptions from the requirements of subpart C is that the final
exemptions are from the requirements of subpart E,

as well as subpart C. As discussed in section XL, the final rule
establishes the requirements for a supply-chain program in subpart E,
rather than within subpart C as proposed.

                                  Table 6--Revisions to the Proposed Exemptions
----------------------------------------------------------------------------------------------------------------
             Section                          Exemption                              Modification
----------------------------------------------------------------------------------------------------------------
507.5(e)........................  From the requirements of subpart    Changes consequential to the
                                   C for on-farm packing or holding   revised ``farm'' definition--i.e., no
                                   of food by a small or very small   longer identifying any packing or holding
                                   business if the only packing and   activities for any RACs.
                                   holding activities subject to      Clarification that the modified
                                   section 418 of the FD&C Act that   requirements do not apply to on-farm
                                   the business conducts are the      packing or holding of food by a very small
                                   specified low-risk packing or      business if the only packing and holding
                                   holding activity/animal food       activities subject to section 418 of the
                                   combinations.                      FD&C Act that the business conducts are
                                                                      the listed low-risk packing or holding
                                                                      activity/animal food combinations.
                                                                      Updated animal food categories
                                                                      consistent with the animal food categories
                                                                      included in table 1 in the section
                                                                      103(c)(1)(C) RA.
                                                                      Additions of low-risk packing or
                                                                      holding activity/animal food combinations
                                                                      as a result of an updated risk assessment.
507.5(f)........................  From the requirements of subpart    Changes consequential to the
                                   C for on-farm manufacturing/       revised ``farm'' definition--i.e.:
                                   processing activities conducted    No longer distinguishing between
                                   by a small or very small           manufacturing/processing activities
                                   business for distribution into     conducted on a farm mixed-type facility's
                                   commerce if the only               own RACs and manufacturing/processing
                                   manufacturing/processing           activities conducted on food other than
                                   activities subject to section      the farm mixed-type facility's own RACs;
                                   418 of the FD&C Act that the       and
                                   business conducts are the          Eliminating activities, conducted
                                   specified low-risk manufacturing/  on others' RACs, that would no longer be
                                   processing activity/animal food    classified as manufacturing/processing and
                                   combinations.                      instead would be classified as harvesting,
                                                                      packing, or holding.
                                                                      Clarification that the modified
                                                                      requirements do not apply to on-farm
                                                                      manufacturing/processing activities
                                                                      conducted by a very small business for
                                                                      distribution into commerce, if the only
                                                                      manufacturing/processing activities
                                                                      subject to section 418 of the FD&C Act
                                                                      that the business conducts are the listed
                                                                      low-risk manufacturing/processing activity/
                                                                      animal food combinations.
                                                                      Updated animal food categories
                                                                      consistent with the animal food categories
                                                                      included in table 1 in the section
                                                                      103(c)(1)(C) RA.
                                                                      Additions of low-risk
                                                                      manufacturing/processing activity/animal
                                                                      food combinations as a result of an
                                                                      updated risk assessment.
507.5(h)........................  From the requirements of subpart   Change from an exemption for specific
                                   B for the holding and              activities (i.e., holding and
                                   transportation of RACs.            transportation of RACs) to facilities
                                                                      solely engaged in those activities.
----------------------------------------------------------------------------------------------------------------

A. General Comments on the Proposed Exemptions

    (Comment 96) Some comments ask us to provide the same flexibility
for foreign small businesses as for domestic small businesses.
    (Response 96) The exemptions apply to both foreign small businesses
and domestic small businesses.
    (Comment 97) Some comments ask us to clarify whether an
establishment that is exempt from the requirements for hazard analysis
and risk-based preventive controls in subpart C remains subject to the
CGMP requirments in subpart B.
    (Response 97) An establishment that is exempt from the requirements
for hazard analysis and risk-based preventive controls in subparts C
and E remains subject to the CGMP requirements in subpart B, unless
that establishment is specifically exempt from subpart B under Sec.
507.5(a) (which applies to farms and activities of ``farm mixed-type
facilities'' that fall within the definition of ``farm''); or Sec.
507.5(h) (which applies to: (1) Establishments solely engaged in the
holding or transportation of one or more RACs; (2) hulling, shelling,
and drying nuts and hulls (without manufacturing/processing, such as
grinding shells or roasting nuts); and (3) ginning of cotton (without
manufacturing/processing, such as extracting oil from cottonseed)).
    (Comment 98) Some comments request that we clearly articulate what
activities are not covered and why; as well as what activities we are
specifically exempting and why. This comment requests clarification
about the differences between the categories of ``not covered'' and
``exempt.''
    (Response 98) We use the terms ``not covered'' and ``exempt''
interchangeably to describe what animal food operations or activities
within an operation are not required to comply with all or parts of
this rule. Farms, for example, are ``not covered'' by this rule, as
established in Sec.  507.5, which lists certain exemptions. As another
example, a business meeting the very small business criteria is a
qualified facility subject to the requirements of Sec.  507.7, but
``exempt'' from the requirements of subparts C and E (see Sec.
507.5(d)). Whether a particular exemption applies to an animal food
operation depends on the type of operation and the activities it is
conducting. We believe the exemptions as codified provide enough
specificity for a facility to determine whether it must comply with or
is exempt from this final regulation, or certain provisions of the
final regulation.
    (Comment 99) One comment expressed the opinion that exemptions
should be driven by risk of activities rather than by whether they are
conducted on or off a farm.
    (Response 99) Consistent with the statutory direction in section
103(c) of FSMA, including conducting a qualitative risk assessment, we
have finalized exemptions for on-farm activity/animal food combinations
conducted by farm-mixed-type facilities that are small or very small
businesses as discussed further in sections VI and X.

B. Proposed Sec.  507.5(a)--Exemption for Facilities Not Required To
Register Under Section 415 Regulations

    We proposed that this part does not apply to establishments,
including ``farms'' (as defined in Sec.  1.227 of this

chapter), that are not required to register under section 415 of the
FD&C Act. However, we proposed that subpart B would apply to the
packaging, packing, and holding of dried commodities if a ``farm'' or
``farm mixed-type facility'' dries/dehydrates raw agricultural
commodities that are produce to create a distinct commodity.
    After reviewing all of the comments concerning raw agricultural
commodities as discussed elsewhere in this final rule, we have removed
the requirement that subpart B would apply to the packaging, packing,
and holding of dried commodities from a ``farm'' or ``farm mixed-type
facility'' that dries/dehydrates RACs that are produce to create a
distinct commodity. We have made this change because produce RACs are
not typically dried or dehydrated to create distinct animal food
commodities, as they are to create human food commodities (e.g.,
drying/dehydrating grapes to make raisins).
    (Comment 100) One comment requests that we provide clarity and
examples for animal food facilities that are exempt from facility
registration and therefore exempt from compliance with part 507 because
they are considered restaurants or retail food establishments.
    (Response 100) Our food facility registration requirements are
found in 21 CFR part 1, subpart H. Specifically, ``restaurant'' and
``retail food establishment'' are defined in 1.227(b). Additional
information may be found in our ``Guidance for Industry: Questions and
Answers Regarding Food Facility Registration (Sixth Edition)'' (Ref.
23). As discussed in section I.E. of the final rule for preventive
controls for human food published elsewhere in this issue of the
Federal Register, we are addressing the requirements of section 102(c)
of FSMA in a separate rulemaking and issued a separate proposed rule to
amend the definition of ``retail food establishment'' in the section
415 registration regulations and the section 414 recordkeeping
regulations (80 FR 19160, April 9, 2015).

C. Proposed Sec.  507.5(b)--Exemption Applicable to Food Subject to 21
CFR Part 113--Thermally Processed Low-Acid Foods Packaged in
Hermetically Sealed Containers

    We proposed that activities in animal food facilities that are
regulated under and are in compliance with Sec.  500.23 and part 113
would be exempt from subpart C only with respect to microbiological
hazards regulated under part 113. We further proposed that the
facilities must comply with subparts C and F with regard to all other
potential hazards and must comply with subparts A and B. We requested
comment on the criteria that should be used to determine whether a
facility is in compliance with Sec.  500.23 and part 113 (78 FR 64736
at 64762).
    (Comment 101) Some comments express concern that the partial
exemption for products subject to part 113 could generate confusion for
both regulators and regulated facilities. These comments also assert
that the partial exemption for products subject to part 113 would
generate duplicative recordkeeping requirements under the two rules.
    (Response 101) We acknowledge the potential for confusion and
expect any confusion to decrease over time as both regulators and
facilities gain experience with the new requirements. We also expect
that in most instances a facility that is subject to Sec.  500.23 and
part 113, and that evaluates potential microbiological hazards as part
of its hazard analysis, would conclude that the potential hazards are
controlled by the targeted requirements of part 113 and conclude there
are no significant microbiological hazards that require preventive
controls to significantly minimize or prevent the hazards.
    We disagree that the partial exemption for products subject to part
113 would generate duplicative recordkeeping requirements. The
requirements of part 113 to control biological hazards are different
from the requirements of subparts C and E to conduct a hazard
evaluation for chemical and physical hazards, and implement preventive
controls and associated preventive control management components to
address significant chemical and physical hazards. Likewise, the
records associated with the control of biological hazards under part
113 are not the same as the records associated with a hazard analysis,
preventive controls, and associated preventive control management
components for control of chemical and physical hazards. However, to
the extent that a facility determines that existing records required by
part 113 can be used to comply with the requirements of subparts C and
E, a facility may rely on those records (see Sec.  507.212).
    (Comment 102) Some comments ask us to provide guidance to industry
and the regulatory community regarding the criteria that will be used
to determine when a facility is ``in compliance with'' part 113.
    (Response 102) As an example, an LACF manufacturing facility that
has ongoing problems controlling biological hazards may be better able
to address biological hazards by preparing and implementing a written
food safety plan. As with facilities subject to our HACCP regulations,
we expect that situations in which enforcement actions to ensure
compliance with part 113 are insufficient to correct problems, and lead
to a facility losing its exemption from the requirements of subparts C
and E, will be rare and will depend on very specific circumstances.
Therefore, at this time we do not anticipate issuing guidance on when
violations of part 113 could lead to this outcome.

D. Proposed Sec.  507.5(c)--Exemption Applicable to Activities Subject
to Standards for Produce Safety in Section 419 of the FD&C Act

    We proposed that subpart C would not apply to activities of a
facility that are subject to section 419 of the FD&C Act (Standards for
Produce Safety) of the FD&C Act (21 U.S.C. 350h).
    (Comment 103) Some comments request that we broaden the exemption
to operations that handle culls of raw, intact, fresh produce. One
comment requested that fresh citrus be considered a low risk product or
excluded from the rule entirely. This comment requested that culls
should not be considered a by-product of fresh citrus production.
    (Response 103) We decline these requests. We have included a
provision under Sec.  507.12 that exempts by-products of off-farm
packing and holding of RACs for animal food use from most of part 507
if ``the human food facility is subject to and in compliance with Sec.
117.8 of part 117, and in compliance with all applicable human food
safety requirements of the Federal Food, Drug, and Cosmetic Act and
implementing regulations.'' The human food facility also must not
further manufacture or process the by-products intended for use as
animal food. The resulting animal food must be held and distributed in
accordance with the CGMPs for the holding and distribution of human
food by-products for use as animal food in Sec.  507.28 and Sec.
117.95. Thus, facilities subject to and in compliance with Sec.  117.8
and applicable safety requirements of the FD&C Act and its implementing
regulations, that pack or hold produce culls off-farm for use as animal
food (without manufacturing or processing the culls) would be exempt
from part 507, except for the limited holding and distribution CGMPs in
Sec.  507.28. Facilities that manufacture or process culls of raw,
intact, fresh produce for use as animal food would be subject to part
507. Activities, such as packing fresh citrus, of a facility that is
subject to section 419 of the FD&C Act are exempt from subparts C.

E. Proposed Sec.  507.5(d)--Exemption Applicable to a Qualified
Facility

    We proposed that subpart C would not apply to a qualified facility,
except as provided by subpart D (Withdrawal of an Exemption Applicable
to a Qualified Facility), and that qualified facilities would be
subject to the requirements in Sec.  507.7.
    (Comment 104) Some comments support the proposed exemption for a
qualified facility. Other comments oppose this proposed exemption,
asserting that it is not risk based and expressing concern that
qualified facilities would cause significant food safety problems. Some
comments ask us to strictly construct and narrowly apply the exemptions
to as few businesses as possible.
    Some comments do not agree that qualified facilities should be
subject to modified requirements because even the modified requirements
are burdensome. Some comments assert that qualified facilities having
an average annual value of animal food sold during the previous 3-year
period of $10,000 or less should be exempt from all requirements
related to hazard analysis and risk-based preventive controls,
including modified requirements. One comment does not specify an amount
of annual sales of animal food, but states that whether a facility is a
qualified facility should be based on whether the facility has caused
any reported injury or illness to humans or animals.
    (Response 104) The exemption for qualified facilities, including
the criteria for being a qualified facility and the applicability of
modified requirements, is expressly directed by section 418(l) of the
FD&C Act. In defining ``very small business'' to mean a business
(including any subsidiaries or affiliates) averaging less than
$2,500,000, adjusted for inflation, per year, during the 3-year period
preceding the applicable calendar year in sales of animal food plus the
market value of animal food manufactured, processed, packed, or held
without sale (e.g., held for a fee or supplied to a farm without sale),
we constructed this exemption to apply to businesses that,
collectively, produce less than 2 percent of the dollar value of animal
food produced in the United States. This is comparable to the
percentage of the human food supply that is exempt under the definition
of very small business for human food (see section XI.B of the final
rule for preventive controls for human food published elsewhere in this
issue of the Federal Register). As previously discussed in section
VIII.A.36, the businesses that will be exempt from the requirements for
hazard analysis and risk-based preventive controls, and will instead be
subject to other requirements, will produce a small portion of the
animal food at potential risk of causing foodborne illness (see the
discussion at 79 FR 58476 at 58502).
    (Comment 105) Some comments assert that a qualified facility should
be exempt from the CGMP requirements of subpart B, as well as the
requirements for hazard analysis and risk-based preventive controls in
subpart C.
    (Response 105) The exemption for qualified facilities is expressly
directed by section 418(l) of the FD&C Act and is limited to an
exemption from the requirements for hazard analysis and risk-based
preventive controls in subparts C and E. The comments provide no basis
for why new statutory requirements for hazard analysis and risk-based
preventive controls should in any way impact CGMP requirements that
apply to the manufacturing, processing, packing, and holding of animal
food. CGMPs provide the basic requirements for ensuring production of
safe animal food. Following the CGMPs is essential to properly address
public (human and animal) health risks from very small facilities that
are provided an exemption from subparts C and E in order to minimize
the burden on such facilities.
    (Comment 106) Some comments ask us to provide that a qualified
facility may voluntarily choose to comply with the requirements for
hazard analysis and preventive controls.
    (Response 106) A qualified facility may voluntarily choose to
comply with the requirements for hazard analysis and risk-based
preventive controls without a specific provision authorizing it to do
so. One way that a qualified facility could comply voluntarily would be
to simply not submit the attestation that it is a qualified facility
(see Sec.  507.7(b) for the requirement for a qualified facility to
submit an attestation regarding its status as a qualified facility).
When we inspect the facility, we would inspect the facility for
compliance with the requirements for hazard analysis and risk-based
preventive controls. Another way for a facility to voluntarily comply
would be to submit the attestation, and specify that it will satisfy
the statutory documentation requirement through documentation of its
food safety practices rather than documentation that it is in
compliance with non-Federal food safety law.
    (Comment 107) Some comments ask us to specify in guidance that a
qualified facility is not required to prepare and implement a food
safety plan.
    (Response 107) We intend to recommend in guidance how a qualified
facility could comply with the requirements in Sec.  507.7 without
satisfying all of the requirements in subparts C and E.

F. Proposed Sec.  507.5(e) and (f)--Exemptions Applicable to On-Farm
Low-Risk Activity/Animal Food Combinations Conducted by a Small or Very
Small Business

    As discussed in section VI.A, consistent with the statutory
direction in section 103(c) of FSMA, including conducting a qualitative
risk assessment, we proposed three exemptions for on-farm activity/food
combinations conducted by farm-mixed-type facilities that are small or
very small businesses (proposed Sec. Sec.  507.5(e), (f)(1), and
(f)(2)).
1. General Comments on the Proposed Exemptions Applicable to On-Farm
Low-Risk Activity/Animal Food Combinations Conducted by a Small or Very
Small Business
    (Comment 108) Some comments assert that conducting a low-risk
activity/food combination should be sufficient to qualify any facility
for exemption from subpart C, regardless of whether the activity is
conducted on-farm or off-farm, or meets the economic threshold for a
small or very small business.
    (Response 108) The statute provides specific direction for those
facilities that can qualify for this exemption. (See sections 418(l)
and 418(o)(2) of the FD&C Act.) See also Response 104 in this final
rule, and Responses 220 and 222 in the final rule for preventive
controls for human food published elsewhere in this issue of the
Federal Register.
    (Comment 109) Some comments state that the exemptions for farming
activities are confusing.
    (Response 109) The activity/animal food combinations listed in
Sec.  507.5(e) are directed to an exemption for packing and holding
activities, whereas the activity/animal food combinations listed in
Sec.  507.5(f) are directed to an exemption for manufacturing/
processing activities. Although these exemptions are more complex than
other exemptions (e.g., because they are directed to specific
activities conducted on specific animal foods), the final ``farm''
definition has simplified them to the extent practicable. For example,
under the ``farm'' definition in the 2013 proposed human preventive
controls rule, whether an activity was packing or manufacturing/
processing depended, in part, on whether the RACs being packed

were the farm's own RACs or others' RACs. In contrast, under the
``farm'' definition established in the final rule for preventive
controls for human food published elsewhere in this Federal Register,
packing RACs is a ``packing'' activity, regardless of ownership of the
RACs being packed.
    (Comment 110) Some comments note a distinction between the
exemptions for on-farm low-risk activity/animal food combinations
conducted by small and very small businesses and the exemption for
qualified facilities. Specifically, the comments state that a farm
mixed-type facility that only conducts low-risk activity/animal food
combinations (such as grinding grains) would be exempt from the
requirements of subpart C, whereas an off-farm qualified facility
grinding grains, while exempt from the requirements of subpart C, would
nonetheless be subject to the requirements for a qualified facility in
Sec.  507.7. These comments ask whether it would be better for a farm
or farm mixed-type facility that satisfies criteria for a small or very
small business, and also satisfies criteria for a qualified facility,
to classify itself as a small or very small business or to classify
itself as a qualified facility.
    (Response 110) In light of the final ``farm'' definition, these
comments no longer apply with respect to activities within the farm
definition.
    For activities conducted by a farm mixed-type facility, we
acknowledge that the exemptions provided by Sec.  507.5(e) and (f) for
on-farm low-risk activity/animal food combinations are different from
the exemption provided by Sec.  507.5(a) for a qualified facility. A
farm mixed-type facility that only conducts low-risk activity/animal
food combinations listed in Sec.  507.5(e) and (f) is fully exempt from
the requirements of subparts C and E, and is not subject to the
requirements for a qualified facility in Sec.  507.7, even if that farm
mixed-type facility is also a very small business (and, thus, also is a
qualified facility). To make this clear, we have revised proposed Sec.
507.5(e) to specify that Sec.  507.7 does not apply to on-farm packing
or holding of animal food by a very small business if the only packing
and holding activities subject to section 418 of the FD&C Act that the
business conducts are the listed low-risk packing or holding activity/
animal food combinations. Likewise, we have revised proposed Sec.
507.5(f) to specify that Sec.  507.7 does not apply to on-farm
manufacturing/processing activities conducted by a very small business
for distribution into commerce, if the only manufacturing/processing
activities subject to section 418 of the FD&C Act that the business
conducts are the listed low-risk manufacturing/processing activity/
animal food combinations.
    With these changes, a farm mixed-type facility that is a very small
business and that only conducts the low-risk activity/animal food
combinations listed in Sec.  507.5(e) and/or (f) may find it
advantageous to classify itself as a very small business eligible for
the exemption in Sec.  507.5(e) and/or (f) rather than as a qualified
facility, which would be subject to the requirements in Sec.  507.7.
    (Comment 111) Some comments ask for a process to keep the list of
low-risk activity/food combinations up to date, such as through
guidance.
    (Response 111) We decline this request. The exemptions established
in this rule are binding, whereas any list of additional activity/
animal food combinations established in a guidance document would not
be binding. We established the list of activity/animal food
combinations included in these exemptions through an extensive public
process, including a request for comments on the section 103(c)(1)(C)
draft RA. From this time forward, the process available to a person who
wishes us to consider an additional activity/animal food combination is
to submit a citizen petition in accordance with 21 CFR 10.30.
2. Proposed Sec.  507.5(e)--Exemption Applicable to On-Farm Low-Risk
Packing or Holding Activity/Animal Food Combinations Conducted by a
Small or Very Small Business
    We proposed that subpart C would not apply to on-farm packing or
holding of animal food by a small or very small business if the only
packing and holding activities subject to section 418 of the FD&C Act
that the business conducts are low-risk packing or holding activity/
animal food combinations on animal food not grown, raised, or consumed
on that farm mixed-type facility or another farm or farm mixed-type
facility under the same ownership.
    (Comment 112) Many comments state that it is common practice among
farms to hold RACs from farms under different ownership and that
classifying establishments as being within the ``farm'' definition, or
outside the ``farm'' definition, based on who owns the RACs being
packed is not a risk-based classification.
    (Response 112) We proposed a revised definition of ``farm'' in the
2014 preventive controls supplemental notice for human food to include
packing and holding of RACs grown on another farm not under the same
ownership (79 FR 58524 at 58531 through 58532). As a consequential
change in light of the final ``farm'' definition established in the
final rule for preventive controls for human food published elsewhere
in this Federal Register, the exemption no longer identifies any
packing or holding activities for any RACs (whether the farm's own RACs
or others' RACs), because an on-farm establishment would no longer be
subject to the requirements for hazard analysis and risk-based
preventive controls (subpart C) when it packs or holds RACs, regardless
of whether it is packing and holding its own RACs or others' RACs. In
light of the change in the ``farm'' definition, we have revised the
section 103(c)(1)(C) RA, starting with the list of on-farm activity/
animal food combinations outside the farm definition in table 1, to
exclude packing and holding of RACs.
3. Proposed Sec.  507.5(f)--Exemption Applicable to On-Farm Low-Risk
Manufacturing/Processing Activity/Animal Food Combinations Conducted by
a Small or Very Small Business
    We proposed that subpart C would not apply to on-farm low-risk
manufacturing/processing activities conducted by a small or very small
business if the only manufacturing/processing activities subject to
section 418 of the FD&C Act that the business conducts are those listed
in the proposed exemption. The proposed exemption specified those
activity/animal food combinations that would be exempt when conducted
on a farm mixed-type facility's own RACs and those activity/animal food
combinations that would be exempt when conducted on animal food other
than the farm mixed-type facility's own RACs for distribution into
commerce.
    As a consequential change in light of the final ``farm''
definition, the final exemption no longer distinguishes between
manufacturing/processing activities conducted on a farm mixed-type
facility's own RACs and manufacturing/processing activities conducted
on animal food other than the farm mixed-type facility's own RACs. As
another consequential change, the exemption has been revised to
eliminate activities, conducted on others' RACs, which no longer are
classified as manufacturing/processing and instead are classified as
harvesting, packing, or holding. In addition, we have revised the final
exemption to list animal food categories consistent with the animal
food categories included in table 1 in the section 103(c)(1)(C) RA
(Ref. 3), modified in response to revisions of the ``farm'' definition.
(See Response 112.) In constructing

categories of animal food based upon the new ``farm'' definition, we
grouped together processed grain products (e.g., flour, grits, etc.)
and grain by-products (e.g., brewers' grain, distillers' grain, and
corn gluten meal). The category does not include culled products from
processing grain for human food such as misshapen pasta. Pasta used in
animal food falls under a new category (any other animal food that does
not require time/temperature control for safety) that was added to
include the wide range of possibilities for animal food that was
originally processed to be human food, as well as other types of animal
food not listed separately.
    (Comment 113) Some comments ask us to include in the exemption a
single list of low-risk manufacturing/processing activity/food
combinations applicable to farm mixed-type facilities conducting
activities on their own RACs and farm mixed-type facilities conducting
activities on other's RACs.
    (Response 113) These comments no longer apply. As a consequence of
the ``farm'' definition established by the final rule for preventive
controls for human food published elsewhere in this Federal Register,
the exemption no longer distinguishes between manufacturing/processing
activities conducted on a farm mixed-type facility's own RACs and
manufacturing/processing activities conducted on animal food other than
the farm mixed-type facility's own RACs.
    (Comment 114) Some comments ask us to include manufacturing of
animal food from low risk ingredients as additional activity/animal
food combinations in the exemption. Other comments support our
conclusion that manufacturing animal food ready for consumption is not
a low risk activity.
    (Response 114) We evaluated manufacturing of animal food as one of
the activity/animal food combinations within the qualitative risk
assessment (Ref. 3). The 103(c)(1)(C) RA explains why we determined
that manufacturing animal food ready for consumption is not a low-risk
activity/animal food combination.

G. Proposed Sec.  507.5(g)--Exemption Applicable to Facilities Solely
Engaged in Storage of Raw Agricultural Commodities Other Than Fruits
and Vegetables Intended for Further Distribution or Processing

    We proposed that subpart C would not apply to facilities that are
solely engaged in the storage of RACs (other than fruits and
vegetables) intended for further distribution or processing. In the
following paragraphs, we discuss comments that ask us to clarify how
the proposed exemption would apply to specific circumstances.
    (Comment 115) Some comments ask whether this proposed exemption
(proposed Sec.  507.5(g)) would apply to facilities such as peanut
buying points or bean elevators and assert that such commodities are
analogous to grains and the activities conducted at such facilities are
analogous to those performed by grain elevators.
    (Response 115) We classify peanuts and beans (such as kidney beans,
lima beans, and pinto beans) within the category of ``fruits and
vegetables''; we classify soybeans as grain (see the discussion of
grains at 78 FR 64736 at 64764 and 79 FR 58476 at 5848, and fruits and
vegetables at 78 FR 3646 at 3690 and proposed Sec. Sec.  112.1 and
112.2 in the proposed produce safety rule). The exemption for
facilities solely engaged in storage of RACs intended for further
distribution or processing does not apply to facilities that store
fruit and vegetable RACs and, thus, does not apply to facilities such
as peanut buying points and bean elevators. As discussed in section
IV.B, we have revised the ``farm'' definition to provide that an
operation devoted only to the harvesting (such as hulling or shelling),
packing, and/or holding of RACs is within the ``farm'' definition,
provided that the farms that grow or raise the majority of the RACs
harvested, packed, and/or held by the operation own, or jointly own, a
majority interest in the operation. With this revision, some operations
dedicated to holding RACs, including fruit and vegetable RACs, will be
within the ``farm'' definition.
    Peanut buying points and bean elevators that do not meet the
revised farm definition are storing RACs that are ``fruits and
vegetables'' and do not meet the criteria for exemption under Sec.
507.5(g). However, we would not expect such facilities to need an
extensive food safety plan. A facility that appropriately determines
through its hazard analysis that there are no hazards requiring
preventive controls would document that determination in its written
hazard analysis but would not need to establish preventive controls and
associated management components.
    (Comment 116) One comment states that genetically modified food
should be added to the list of hazards that are seen as potential risks
for animals.
    (Response 116) We decline this request. We have not seen evidence
that foods derived from genetically engineered plants differ from other
foods in any meaningful or uniform way, or that, as a class, such foods
present different or greater safety concerns than their non-genetically
engineered counterparts. We have a voluntary consultation process for
foods derived from genetically engineered plants through which we
engage with the developers of genetically engineered plants to help
ensure the safety of the derived foods. Foods that have undergone this
consultation process are as safe as foods from conventionally bred
plants. Foods derived from genetically engineered plants, irrespective
of the method of development, are subject to the same food safety and
other regulatory requirements as foods derived from conventionally-bred
plants. Therefore genetically engineered foods do not need to be
singled out as a hazard.
    (Comment 117) Some comments assert that the exemption for storage
of raw agricultural commodities (other than fruits and vegetables)
should extend to those distinct and physically separate portions of
oilseed processing facilities that are devoted solely to RAC storage.
According to these comments, in the overwhelming majority of cases the
inclusion of a separate RAC storage area in the same building as the
oilseed processing area will not introduce additional risk either to
the processing area or to the operations that take place there and that
storage areas, whether standing alone as a separate facility or
incorporated into a larger processing facility, store RACs safely.
These comments ask us to recognize that storage activities may include
grain drying to standardize moisture levels and preserve product
quality.
    (Response 117) The activities included within the definition of
holding include activities that are performed as a practical necessity
for the distribution of RACs. In the 2014 supplemental notice, we
explained that facilities that conduct operations similar to those
conducted at grain elevators and silos, such as some facilities that
hold oilseeds, may satisfy the criteria for exemption if activities
other than storage are performed as a practical necessity for the
distribution of RACs (see 79 FR 58476 at 58483 and the definition of
``holding'' in Sec.  507.3). Examples of holding activities include
drying/dehydrating RACs when the drying/dehydrating does not create a
distinct commodity (see Sec.  507.3). Thus, the specific example of
drying grains to standardize moisture levels and preserve product
quality would fall within the definition of holding as a practical
necessity for the distribution of RACs. A facility that stores
oilseeds, and dries them as a practical necessity for the distribution
of RACs, would be covered by the exemption in Sec.  507.5(g).

    However, we decline the request to modify the exemption in Sec.
507.5(g) to also apply to distinct and physically separate storage
areas that are used solely for storage of RACs (other than fruits and
vegetables) intended for further distribution or processing. To the
extent that the comments are asking us to do so to provide for
facilities that conduct activities as a practical necessity for the
distribution of RACs to be eligible for the exemption, doing so is not
necessary in light of the definition of holding. To the extent that the
comments are asking us to do so to provide for facilities that conduct
manufacturing/processing activities in addition to holding activities,
we disagree that doing so would be consistent with the statutory
direction in FSMA. As previously discussed, section 418(m) of the FD&C
Act provides in relevant part that we may by regulation exempt or
modify the requirements for compliance under section 418 of the FD&C
Act with respect to facilities that are solely engaged in the storage
of RACs (other than fruits and vegetables) intended for further
distribution or processing (78 FR 64736 at 64764). The plain meaning of
``solely'' is only, completely, entirely; without another or others;
singly; alone (Ref. 24). Facilities that conduct manufacturing/
processing activities in addition to holding activities are not
``solely'' engaged in the storage of RACs (other than fruits and
vegetables) intended for further distribution and processing.
    (Comment 118) Some comments request that the language of Sec.
507.5(g) explicitly state that the exemption from subpart C would apply
to facilities that are solely engaged in the packing and holding of raw
agricultural commodities (other than fruits and vegetables) intended
for further distribution or processing. These comments indicate that
packing is frequently involved when a facility distributes raw
agricultural commodities that they have been holding. They cite the
Sec.  110.19(a) exemption from the human food CGMP regulation for
establishments ``engaged solely in the harvesting, storage, or
distribution of one or more `raw agricultural commodities' '' and
remark that in application of the regulation, the activity of packing
has been encompassed within the term ``distribution.'' In addition,
some comments ask that the exemption proposed in Sec.  507.5(g) be
extended to an exemption from subpart B, as well as from subpart C.
    (Response 118) We decline the request to add the term ``packing''
to Sec.  507.5(g). As discussed in Response 117, the activities
included within the definition of holding include activities that are
performed as a practical necessity for the distribution of RACs. Under
Sec.  507.5(h), subpart B does not apply to the holding or
transportation of one or more RACs. (See section X.H.)

H. Proposed Sec.  507.5(h)--Exemption Applicable to the Holding or
Transportation of One or More Raw Agricultural Commodities

    We proposed to provide that subpart B would not apply to the
holding or transportation of one or more RACs as defined in section
201(r) of the FD&C Act.
    (Comment 119) Some comments ask us to include the term ``packing''
in Sec.  507.5(h) to say ``Subpart B of this part does not apply to the
packing and holding or transportation of one or more raw agricultural
commodities as defined in section 201(r) of the Federal Food, Drug, and
Cosmetic Act.''
    (Response 119) We decline the request to add the term ``packing''
to Sec.  507.5(h). As discussed in Response 117, the activities
included within the definition of holding include activities that are
performed as a practical necessity for the distribution of RACs.
    (Comment 120) Some comments ask us to clarify that CGMP
requirements (such as using protective coverings where necessary and
appropriate (Sec.  507.17(c)) do not apply to the bulk outdoor storage
of RACs for further processing.
    (Response 120) We are returning to the longstanding approach that
the exemption applies to establishments ``solely engaged'' in specific
activities. Under the exemption we are establishing in Sec.
507.5(h)(1), those activities are holding and transportation of RACs.
We explain why in the following paragraphs.
    These comments appear to interpret the proposed exemption in a way
that goes beyond the longstanding ``RAC exemption'' in the human food
CGMPs in Sec.  110.19 and is inconsistent with the intent in updating
Sec.  110.19 to adjust and clarify what activities fall within this
exemption based on experience and changes in related areas of the law
since issuance of this exemption from the CGMPs (78 FR 64736 at 64764
and 78 FR 3646 at 3710). The suggestion of these comments, i.e., that
CGMPs should not apply to the holding of RACS in a facility that
manufactures, processes, or packs RACs--would not make sense in some
circumstances and would create complex situations for establishments
(in determining how to comply with the CGMP requirements) and for
regulators (in determining how to enforce the CGMP requirements). For
example, it does not make sense for the part of a facility that holds
RACs prior to processing to be exempt and the parts of the facility
that are processing the RACs and storing them after processing to be
covered. Likewise, it does not make sense for part of a transportation
vehicle to be covered and part to be exempt.
    By revising the proposed ``RAC exemption'' so that it applies only
to establishments ``solely engaged'' in the storage or transportation
of RACs, we are providing for a predictable framework for interpreting
exemptions for facilities ``solely engaged'' in other activities. For
example, as discussed in Comment 117, comments ask us to expand the
exemption (in Sec.  507.5(g)) from the requirements for hazard analysis
and risk-based preventive controls for facilities that are ``solely
engaged'' in the storage of RACs (other than fruits and vegetables)
intended for further distribution or processing to also apply to
distinct and physically separate storage areas that are used solely for
storage of such RACs. In our response, we noted that facilities that
conduct manufacturing/processing activities in addition to holding
activities are not ``solely engaged'' in the storage of such RACs (see
Response 117). In addition, as discussed in Comment 146, comments ask
us to apply the exemption (in Sec.  507.10) from the requirements for
hazard analysis and risk-based preventive controls for facilities that
are ``solely engaged'' in the storage of unexposed packaged food to
storage areas of facilities that also engage in food processing
activities, e.g., for distributors that are engaged in limited food
processing, such as blending seeds to make bird food. In our response,
we noted that such distributors are not ``solely'' engaged in the
storage of unexposed packaged animal food (see Response 146).
    The exemption we are establishing in this rule for establishments
solely engaged in the storage or transportation of RACs remains
consistent with our announced intent to adjust and clarify what
activities fall within this exemption based, in part, on changes in
related areas of the law since this exemption from the CGMP
requirements was first issued. As discussed in section IV of the final
rule for preventive controls for human food, published elsewhere in
this issue of the Federal Register, we have made a number of changes to
the ``farm'' definition, including changes that provide for an
operation devoted to harvesting, packing, and/or holding of RACs to be
a ``farm'' (i.e., a ``secondary activities

farm'') (and, thus, be exempt from the CGMP requirements under Sec.
507.5(a)) even though the operation does not grow RACs (see Sec.
507.3). With this revised ``farm'' definition, some establishments
solely engaged in the ``storage'' of RACs will be exempt from the CGMP
requirements because they are a ``farm.'' For further discussion on
this provision, see section XI.J in the final rule for preventive
controls for human food.

I. Comments Requesting Additional Exemptions

    (Comment 121) Some comments request additional exemptions from the
requirements for hazard analysis and risk-based preventive controls in
subpart C, the CGMP requirements of subpart B, or both.
    (Response 121) We believe that our CGMP regulations, coupled with
implementation of FSMA's directives to focus more on preventing food
safety problems than on reacting to problems after they occur, will
play an important role in increasing animal food safety. We did not
propose any exemptions or exceptions from the requirements of subpart C
other than those authorized by section 103 of FSMA (78 FR 64736 at
64743 through 64744). We drew on our experience with the CGMP
regulation for human food and changes in related areas of the FD&C Act
since issuance of the CGMP regulation (78 FR 3646 at 3709 through 3711)
to adjust and clarify what activities fall within a longstanding
exclusion related to raw agricultural commodities (see Sec.  110.19)
and to modify the CGMPs for human food by-products for use as food for
animals.
    (Comment 122) Some comments state that facilities that hull, shell,
and dry tree nuts without further processing could be characterized as
establishments engaged solely engaged in the harvesting, storage, or
distribution of one or more raw agricultural commodities. These
comments express an expectation that since hulled or shelled dried nuts
retain their raw agricultural commodity status, that facilities
hulling, shelling and drying tree nuts without further processing would
qualify for exemption under both proposed Sec. Sec.  507.5(g) and
507.5(h).
    (Response 122) Hulling and shelling of tree nuts (such as walnuts,
almonds, and pistachios) are harvesting activities that are within the
``farm'' definition when conducted on a farm or farm mixed-type
facility. Drying/dehydrating RACs without creating a distinct commodity
(such as drying walnuts and hulls) is a holding activity that also is
within the ``farm'' definition when conducted on a farm or farm mixed-
type facility. As discussed in section IV.B of the final rule for
preventive controls for human food (published elsewhere in this issue
of the Federal Register) we have revised the ``farm'' definition to
provide that an operation, not conducted on a Primary Production Farm,
devoted to the harvesting (such as hulling or shelling), packing, and/
or holding of RACs is within the ``farm'' definition (as a ``secondary
activities farm''), provided that the primary production farm(s) that
grow or raise the majority of the RACs harvested, packed, and/or held
by the secondary activities farm own, or jointly own, a majority
interest in the operation. Non-farm facilities dedicated to the
hulling, shelling, and drying of nuts and hulls perform the same
activities as those performed by farms. When done on a primary
production farm or by a secondary activities farm, those activities
would not be subject to CGMPs. Furthermore, these activities do not
transform the RAC into a processed food. Therefore, we have added
regulatory text in Sec.  507.5(h) to provide an exemption from subpart
B for hulling, shelling, and drying nuts and hulls (without further
manufacturing/processing) by a non-farm hulling/shelling/drying
facility because of the similarity in the activities of a farm-owned
operation and a non-farm owned facility. However, non-farm facilities
are not exempt from subparts C and E under Sec.  507.5(g) as they are
not solely engaged in the storage of raw agricultural commodities. A
facility that appropriately determines through its hazard analysis that
there are no hazards requiring preventive controls would document that
determination in its written hazard analysis but would not need to
establish preventive controls and associated management components.
    (Comment 123) Some comments state that ginning cotton to separate
cotton fiber from cotton seed is a low-risk harvesting activity.
Comments further note that since cotton seed used as animal food is a
by-product from the production of cotton lint, the cotton seed coming
from a ginning facility would not qualify as a human food by-product.
The comments request that facilities whose entire operation consists of
receiving and ginning cotton without further processing the cotton
seeds be exempt from both subpart C under Sec.  507.5(g) and subpart B
under Sec.  507.5(h).
    (Response 123) Ginning cotton is a harvesting activity that is
within the ``farm'' definition when conducted on a farm or farm mixed-
type facility. Drying/dehydrating the cottonseed without further
processing is a holding activity that also is within the ``farm''
definition when conducted on a farm or farm mixed-type facility. (See
Response 122 for a discussion on modification to the farm definition).
When done on a primary production farm or by a secondary activities
farm, these activities (ginning, drying, dehydrating) would not be
subject to CGMPs, and these activities do not transform the RAC into a
processed food. Therefore, we have added regulatory text in Sec.
507.5(h)(2) to provide an exemption from subpart B for the ginning of
cotton (without further manufacturing/processing) by a non-farm cotton
ginning facility because of the similarity between a farm-owned
operation and a non-farm owned facility (See Response 122). However,
non-farm facilities are not exempt from subparts C and E under Sec.
507.5(g) as they are not solely engaged in the storage of raw
agricultural commodities. A facility that appropriately determines
through its hazard analysis that there are no hazards requiring
preventive controls would document that determination in its written
hazard analysis but would not need to establish preventive controls and
associated management components.

XI. Subpart A: Comments on Proposed Sec.  507.7--Requirements That
Apply to a Qualified Facility

    As previously discussed (78 FR 64736 at 64765), sections
418(l)(2)(A) and (B) of the FD&C Act provide that a qualified facility
must submit two types of documentation to us. The first type of
required documentation relates to food safety practices at the
facility, with two options for satisfying this documentation
requirement. Under the first option, the qualified facility may choose
to submit documentation that demonstrates that it has identified
potential hazards associated with the animal food being produced, is
implementing preventive controls to address the hazards, and is
monitoring the preventive controls to ensure that such controls are
effective. Alternatively, under the second option, the qualified
facility may choose to submit documentation (which may include
licenses, inspection reports, certificates, permits, credentials,
certification by an appropriate agency (such as a State department of
agriculture), or other evidence of oversight), that the facility is in
compliance with State, local, county, or other applicable non-Federal
food safety law. The second type of required

documentation relates to whether the facility satisfies the definition
of a qualified facility.
    If a qualified facility does not prepare documentation
demonstrating that it has identified potential hazards associated with
the animal food being produced, is implementing preventive controls to
address the hazards, and is monitoring the preventive controls to
ensure that such controls are effective, it must provide notification
to consumers of certain facility information by one of two procedures,
depending on whether an animal food packaging label is required on the
animal food.
    Consistent with the statutory direction of section 418(l) of the
FD&C Act, we proposed the following requirements for qualified
facilities: (1) Submission of certain documentation (proposed Sec.
507.7(a)); (2) procedures for submission of the documentation (proposed
Sec.  507.7(b)); (3) the frequency of the submissions (proposed Sec.
507.7(c)); (4) notification to consumers in certain circumstances
(proposed Sec.  507.7(d)); and (5) applicable records that a qualified
facility must maintain (proposed Sec.  507.7(e)).
    In the 2013 proposed preventive controls rule for animal food, we
tentatively concluded that a certified statement would be acceptable
for the purposes of satisfying the submission requirements of proposed
Sec.  507.7(a). We also requested comment on the efficiency and
practicality of submitting the required documentation using the
existing mechanism for registration of food facilities, with added
features to enable a facility to identify whether or not the facility
is a qualified facility.
    Some comments support one or more of the proposed requirements
without change. For example, some comments state that our proposed
interpretation of the statutory term ``business address'' is consistent
with our use of the term ``business address'' in our regulations
regarding information that must be included in a prior notice for
imported food (Sec.  1.281). Some comments that support the proposed
provisions suggest alternative or additional regulatory text or ask us
to clarify how we will interpret the provision.
    In this section, we discuss comments that ask us to clarify the
proposed requirements or that disagree with, or suggest one or more
changes to, the proposed requirements. We also address comments
discussing our tentative conclusion regarding the submission of
certified statements to FDA, including submitting certified statements
using the existing mechanism for registration of food facilities. After
considering these comments, we have revised the proposed requirements
as shown in table 7 with editorial and conforming changes as shown in
table 31.
    As discussed in Response 76, we have revised the definition of very
small business to specify that it is based on an average (of sales plus
market value of animal food held without sale) during the 3-year period
preceding the applicable calendar year and, as a companion change, we
are explicitly requiring that a facility determine and document its
status as a qualified facility on an annual basis (see Sec.
507.7(c)(1)).

                    Table 7--Revisions to the Proposed Requirements for Qualified Facilities
----------------------------------------------------------------------------------------------------------------
               Section                       Description                            Revision
----------------------------------------------------------------------------------------------------------------
507.7(a).............................  Documentation to be       Specify that the submitted
                                        submitted.               documentation is an ``attestation.``
                                                                 Add ``tribal'' as an example of
                                                                 applicable non-Federal food safety law.
507.7(b).............................  Procedure for            Update details regarding the electronic and
                                        submission.              paper submission of a form specific to the
                                                                 attestation requirement.
507.7(c).............................  Frequency of              New requirement to determine and
                                        determination and        document status as a qualified facility on an
                                        submission.              annual basis no later than July 1 of each
                                                                 calendar year.
                                                                 Specify that a facility that begins
                                                                 manufacturing, processing, packing, or holding
                                                                 animal food after September 17, 2019 must
                                                                 submit the attestation before beginning such
                                                                 operations.
                                                                 Specify that a facility must notify FDA
                                                                 of a change in status from ``not a qualified
                                                                 facility'' to ``qualified facility'' by July 31
                                                                 of the applicable calendar year.
                                                                 Specify that when the status of a
                                                                 facility changes from ``qualified facility'' to
                                                                 ``not a qualified facility'' based on the
                                                                 annual determination, the facility must notify
                                                                 FDA of that change in status using Form FDA
                                                                 3942b by July 31 of the applicable calendar
                                                                 year.
                                                                 Specify that the required biennial
                                                                 submissions of the attestations must be made
                                                                 during a timeframe that will coincide with the
                                                                 required biennial updates to facility
                                                                 registration.
507.7(d).............................  Timeframe for            When the status of a facility changes from
                                        compliance with the      ``qualified facility'' to ``not a qualified
                                        requirements of          facility,'' the facility must comply with
                                        subparts C and E.        subparts C and E no later than December 31 of
                                                                 the applicable calendar year unless otherwise
                                                                 agreed to by FDA and the facility.
507.7(e).............................  Notification to          Conforming changes associated with the term
                                        consumers.               ``attestation.``
507.7(f).............................  Records................  Conforming changes associated with the term
                                                                 ``attestation.``
----------------------------------------------------------------------------------------------------------------

A. Comments on Submission of a Certification Statement

    (Comment 124) Some comments ask us to clarify the distinction
between the documentation that would be submitted to FDA and the
records that a qualified facility relies on to support the submitted
documentation.
    Some comments agree with our tentative conclusion to use certified
statements to satisfy the proposed submission requirements, noting that
it would save time and money and reduce the paperwork burden on
qualified facilities. Some comments ask us to revise the proposed
requirements to make this use of certified statements explicit in the
regulatory text.
    Other comments disagree with our tentative conclusion to use
certified statements to satisfy the submission requirements. These
comments focus on the importance of actual copies of documents in
determining compliance with the documentation requirements and assert
that proof of qualification requires more than a checked box in an
online registration database. Some comments ask us to require that a
qualified facility affirm that it has the original documents on file
and available for FDA inspection. Other comments assert that requiring
qualified facilities to submit copies of the actual documentation would
enable us to

easily review food safety plans or inspection reports and to target our
compliance and enforcement activities to those qualified facilities
that pose a greater risk because of inadequate prevention measures or
deficient inspections.
    (Response 124) We are affirming our tentative decision that we will
not require a qualified facility to submit to FDA as part of its
attestation the underlying documentation that establishes its
compliance. We agree that the underlying records are needed to
determine compliance with the documentation requirements and that a
qualified facility must retain the documents it is relying on to
support its attestation and make them available to us during
inspection. We also agree that the regulatory text needs to be explicit
regarding the required documentation and that we need to clearly
distinguish between the documentation that would be submitted to FDA
and the records that a qualified facility relies on to support the
submitted documentation. Therefore, we have made the following three
revisions to the proposed regulatory text.
    First, we have revised proposed Sec.  507.7(a) to specify that the
submitted documentation is an ``attestation.'' Second, we have revised
proposed Sec.  507.7(b) to update details regarding the electronic and
paper submission of a form specific to this attestation requirement.
Third, we have revised proposed Sec.  507.7(e) (final Sec.  507.7(f))
to specify that you must maintain those records relied upon to support
the ``attestations'' that are required by Sec.  507.7(a).
    We acknowledge that requiring submission of the actual
documentation would enable us to easily review food safety plans or
inspection reports and to target our compliance activities based on
information that we see in those food safety plans or inspection
reports. However, as discussed in Response 245, we are not requiring
that other facilities submit a ``facility profile'' that would allow us
to more broadly review food safety plans and target our compliance
activities based on information that we see in those food safety plans
and will instead explore other mechanisms to achieve the goals we
described in the 2013 proposed preventive controls rule for animal food
for a facility profile.

B. General Comments on Requirements That Apply to a Qualified Facility

    (Comment 125) Some comments assert that the proposed requirements
would create a costly burden for qualified facilities (e.g.,
registering and making submissions to FDA) that would not be imposed on
other types of exempted facilities. Some of these comments question
whether the exemption for qualified facilities is meaningful in light
of the significant burden imposed by the proposed requirements. Some
comments contrast the proposed requirement for qualified facilities to
submit documentation to FDA with proposed requirements for all other
facilities to simply establish and maintain applicable records.
    (Response 125) The submission requirements that we are establishing
in this rule for qualified facilities reflect the statutory framework
for qualified facilities (section 418(l)(2)(B) of the FD&C Act).
Although the submission requirements only apply to qualified
facilities, the reporting burden associated with submission of an
attestation is much lower than the recordkeeping burden for facilities
that are subject to the requirements for hazard analysis and risk-based
preventive controls (see section LVIII).
    (Comment 126) Some comments ask us to minimize setting different
standards even though the requirements reflect express statutory
provisions.
    (Response 126) These comments appear to be referring to the
statutory provisions of section 418(n)(3)(C) of the FD&C Act, which
specify that the regulations we establish to implement section 418 of
the FD&C Act acknowledge differences in risk and minimize, as
appropriate, the number of separate standards that apply to separate
foods. We disagree that the statutory provisions of section
418(n)(3)(C) are directly relevant to the submission requirements of
this rule for qualified facilities. The requirements for qualified
facilities, but not other facilities, to submit documentation to FDA
reflect different regulatory requirements. The different regulatory
requirements are directed at different facilities, and do not set
separate standards for particular animal foods. Regardless, even if the
statutory provisions of section 418(n)(3)(C) were relevant to the
submission requirements of qualified facilities, provisions of this
rule that reflect express statutory provisions would not conflict with
the statutory direction in section 418(n)(3)(C).
    (Comment 127) Some comments emphasize that the requirements need to
ensure adequate protection of public health and state that we should
maintain and exercise oversight of qualified facilities. Some comments
ask that we provide enough specificity so that qualified facilities
know and understand their food safety responsibilities towards
consumers.
    (Response 127) A facility that satisfies criteria to be a qualified
facility continues to be responsible to produce animal food that will
not be adulterated under section 402 of the FD&C Act. Such a facility
is also subject to the requirements of section 421 of the FD&C Act
regarding frequency of inspection of all facilities and to the new
administrative tools provided by FSMA, such as for suspension of
registration (section 415 of the FD&C Act) and for mandatory recall
(section 423 of the FD&C Act). As discussed in Response 77, we expect
that most qualified facilities will be subject to the CGMP requirements
of subpart B. When they are inspected, we will be ensuring they are in
compliance with the CGMP requirements once the applicable compliance
date is reached.
    (Comment 128) Some comments ask which exemption a farm mixed-type
facility should follow if it satisfies criteria for a qualified
facility (Sec.  507.5(d)), as well as criteria for a very small
business that only conducts on-farm low-risk activity/animal food
combinations (specified in Sec.  507.5(e) and (f)) and one comment
suggests that FDA should allow such a facility to choose which
exemption to follow.
    (Response 128) We describe these comments in more detail in Comment
110. A farm mixed-type facility that is a very small business and that
only conducts the low-risk activity/animal food combinations listed in
Sec.  507.5(e) and (f) may find it advantageous to classify itself as a
very small business eligible for the exemption in Sec.  507.5(e) and
(f) (which is not subject to the requirements in Sec.  507.7) rather
than as a qualified facility (which is subject to the requirements in
Sec.  507.7).
    (Comment 129) Some comments express concern about State access to
the records that a qualified facility maintains to support its
attestations, particularly when a State would conduct an inspection for
compliance with part 507 under contract to FDA. These comments express
concern about the time and resources necessary to verify the status of
a facility as a qualified facility and note that previous mechanisms
whereby we provide information to States in advance of inspection have
been slow. These comments also express concern that if the state must
verify the ``qualified facility'' status of all firms, including those
that are not FDA contracts, this could delay their ability to conduct
timely inspections and increase inspection time, reducing the number of
inspections conducted.
    (Response 129) We are sensitive to the time required for various
inspection

activities and intend to communicate with States regarding our
expectations for how to verify whether a facility is a qualified
facility.
    (Comment 130) Some comments point out that the proposed procedures
for submission are silent on the process and timeframe for our review
and approval of the submitted documentation and ask us to clarify this
process and timeframe. Other comments ask us to clarify the
consequences to a facility if its submission is found to be
insufficient.
    (Response 130) We will not be approving the submitted attestations.
Instead, we intend to use the information to determine whether the
facility should be inspected for compliance with the requirements for
hazard analysis and risk-based preventive controls, or for compliance
with the requirements for a qualified facility. During the inspection,
we would ask to see the records that the facility maintains to support
any submitted attestations.
    (Comment 131) Some comments ask us to clarify whether a foreign
facility would need to submit documentation of its status as qualified
facility. These comments note that a foreign facility also would be
required to provide information to an importer and assert that
submitting information to both FDA and an importer would be a
duplication of effort. These comments ask us to allow a foreign
facility that is a qualified facility to submit information to either
FDA or the importer, rather than to both FDA and the importer.
    (Response 131) We decline this request. Documentation submitted to
an importer would not reach FDA and, thus, could not satisfy the
requirements of this rule. We are requiring submission of an
attestation, on a form that can be submitted either electronically or
on paper, rather than submission of the underlying information.

C. Proposed Sec.  507.7(a)--Documentation To Be Submitted

1. Section 507.7(b)(1)--Documentation That the Facility Is a Qualified
Facility
    We proposed that a qualified facility must submit documentation
that the facility is a qualified facility. We also proposed that for
the purpose of determining whether a facility satisfies the definition
of a qualified facility, the baseline year for calculating the
adjustment for inflation is 2011. As discussed in Response 124, we have
revised the provision to specify that the documentation that must be
submitted is an attestation.
    (Comment 132) Some comments ask us to clarify the documentation
required to certify that an operation is a qualified facility. Some
comments ask us to explicitly state that the documentation must include
financial and sales records of the business and its subsidiaries or
affiliates. Some comments ask us to clarify the types of records that
would be required to be submitted by foreign establishments to support
the classification of a foreign establishment as a ``qualified
facility.''
    (Response 132) The submission to FDA will be an attestation rather
than the records that the qualified facility relies on to support the
attestation; however, you must maintain those records relied upon to
support the ``attestations'' (see Sec.  507.7(f)). As previously
discussed, consistent with section 418(l)(2)(B)(ii) of the FD&C Act, we
intend to issue guidance on the records that a facility could retain to
demonstrate that it is a qualified facility (78 FR 64736 at 64767). As
discussed in Response 124, we have revised the regulatory text to
provide for qualified facilities to submit an attestation that the
facility is in compliance with State, local, county, tribal, or other
applicable non-Federal food safety law. We intend to focus on records
demonstrating that a facility is a very small business (i.e., financial
records demonstrating that a business averages less than $2,500,000
adjusted for inflation, per year, during the 3-year period preceding
the applicable calendar year in sales of animal food plus the market
value of animal food manufactured, processed, packed, or held without
sale (e.g., held for a fee or supplied to a farm without sale)) rather
than records demonstrating that the average annual monetary value of
the food manufactured, processed, packed or held at such facility that
is sold directly to qualified end-users during a 3-year period exceeded
the average annual monetary value of the food sold by the facility to
all other purchasers. We expect that financial records demonstrating
that a business is a very small business will be less burdensome for a
qualified facility to maintain and require fewer resources for FDA to
review.
    During an inspection, we expect the facility to be able to show us
how the facility is complying with the applicable food safety
regulation (including relevant licenses, inspection reports,
certificates, permits, credentials, or certifications), and producing
safe animal food.
    (Comment 133) Some comments ask how the adjustment for inflation
will be calculated and how regulators such as the states will get this
information.
    (Response 133) We intend to use the Federal calculation for the
Gross Domestic Product price deflator, as provided by the Bureau of
Economic Analysis, to adjust for inflation. We will make the inflation-
adjusted dollar value to the baseline very small business cutoffs (e.g.
$2,500,000 in 2011) available on our Internet site. We will update the
values for the very small business exemptions and qualifications
annually using this calculation.
2. Proposed Sec.  507.7(a)(2)(i)--First Option for Documentation: Food
Safety Practices.
    We proposed two options for satisfying the statutory documentation
requirement in section 418(l)(2)(B)(i) of the FD&C Act. Under the first
option (the food safety practices option), a qualified facility could
submit documentation demonstrating that it has identified the potential
hazards associated with the animal food being produced, is implementing
preventive controls to address the hazards, and is monitoring the
performance of the preventive controls to ensure that such controls are
effective. As discussed in Response 124, we have revised the provision
to specify that the submission is an attestation.
    (Comment 134) Some comments assert that the rule is vague about
what the applicable documentation should include and how exhaustive it
should be. Some comments ask whether documentation (such as a food
safety plan) must address all operations at the establishment or only
those that trigger the registration of the establishment as a facility.
Some comments ask us to clarify the difference between having
documentation to support food safety practices and attesting that the
facility has such documentation. Other comments ask whether a qualified
facility would need to have records documenting a risk analysis and
monitoring.
    (Response 134) If a qualified facility submits an attestation
regarding its food safety practices, the documentation that the
facility maintains for review during inspection must specify that the
facility has identified the potential hazards associated with the
animal food being produced, is implementing preventive controls to
address the hazards, and is monitoring the performance of the
preventive controls to ensure that such controls are effective (see
Sec.  507.7(a)(2)(i)). For example, a qualified facility that produces
raw dog food might have documentation specifying that it has determined
that Salmonella is a hazard requiring a preventive control, describing
the process that will

control Salmonella, describing sanitation controls to prevent
contamination of raw dog food with Salmonella, and describing an
environmental monitoring program to verify that its sanitation controls
are effective. Likewise, a qualified facility that makes a custom
cattle food might have documentation specifying that it has determined
that metal objects are a hazard requiring a preventive control and
supporting the use of a magnet to remove metal objects from the cattle
food, with procedures for monitoring the magnet's use if applicable.
    As discussed in Response 124, a qualified facility that chooses the
food safety practices option for complying with the submission
requirements of this rule will attest to that by checking a statement
on a form. In contrast, a food safety plan (or other documentation)
that the qualified facility relies on to support the attestation will
be a record subject to the recordkeeping requirements of subpart F.
3. Proposed Sec.  507.7(a)(2)(ii)--Second Option for Documentation:
Compliance With Other Applicable Non-Federal Food Safety Law
    Under the second option for satisfying the statutory documentation
requirement, a qualified facility could submit documentation that it is
in compliance with State, local, county, or other applicable non-
Federal food safety law, including relevant laws and regulations of
foreign countries. As discussed in Response 124, we have revised the
provision to specify that the submission is an attestation. We also
have revised the provision to add ``tribal'' as an example of
applicable non-Federal food safety law to clarify for purposes of this
rule that a qualified facility could submit an attestation that it is
in compliance with tribal food safety law.
    (Comment 135) Some comments object to the proposed provision. These
comments point out that State and local requirements are inconsistent
and assert that such requirements are not sufficiently rigorous to
substitute for the FSMA requirement to conduct a hazard analysis and
establish and execute a documented food safety plan. One comment
asserts that the state laws may not provide the same level of
protection to consumers.
    (Response 135) The provision reflects the express statutory
direction of section 418(l)(2)(B)(i)(II) of the FD&C Act. Most of these
qualified facilities are subject to the CGMP requirements of subpart B
and a facility that satisfies criteria to be a qualified facility
continues to be responsible to produce animal food that will not be
adulterated under section 402 of the FD&C Act.
    (Comment 136) Some comments ask us to specify that a qualified
facility must document compliance with all applicable non-Federal food
safety laws. One comment asks what evaluation FDA will conduct of any
non-Federal food safety law before determining that compliance with
such law constitutes compliance under FSMA for a qualified facility.
    (Response 136) We decline this request. Section 418(l)(2)(B)(i)(II)
of the FD&C Act refers to apply to compliance with ``State, local,
county, or other applicable non-Federal food safety law'' (emphasis
added). As discussed in Response 132, we have revised the regulatory
text to provide for qualified facilities to submit an attestation that
the facility is in compliance with State, local, county, or other
applicable non-Federal food safety law During an inspection, we expect
the facility to be able to show us how the facility is complying with
the applicable food safety regulation (including relevant licenses,
inspection reports, certificates, permits, credentials, or
certifications), and producing safe animal food.
    (Comment 137) Some comments ask us to provide resources to the
States to implement the proposed provision. These comments also ask us
to develop and implement a strategic plan to provide resources (e.g.
training, guidance) to State and local inspection agencies in advance
of the anticipated increased burden on State and local inspection
programs that will be created by the provision.
    (Response 137) We do not believe that specific training for State
or other government counterparts is necessary for the purposes of
inspecting a qualified facility that attested to having documentation
from a non-Federal regulatory authority. The State or other government
counterpart would merely examine applicable documentation (such as a
license, inspection report, certificate, permit, credentials, or
certification by an appropriate agency (such as a State department of
agriculture)), which is specified in the provision. After inspecting
such documentation, the State or other government counterpart would
focus on inspection for compliance with CGMPs.

D. Proposed Sec.  507.7(b)--Procedure for Submission

    We proposed that the documentation must be submitted to FDA either
electronically or by mail. As discussed in Response 124, we have
revised the regulatory text to update details regarding the electronic
and paper submission of a specific form. We are developing paper and
electronic versions of Form FDA 3942b, which is an information
collection provision that is subject to review by OMB under the
Paperwork Reduction Act of 1995 (44 U.S.C. 3501 to 3520). We intend to
make the paper Form FDA 3942b available in the near future and invite
comments consistent with procedures for approval of the form by OMB.
    (Comment 138) Some comments recommend that any interface for
electronic submission of certification statements post adequate notice
of requirements the facility must meet and warnings detailing potential
penalties (e.g., for fraudulent submission).
    (Response 138) We intend that the electronic submission system will
operate in a manner similar to the existing electronic submission
system for registration of food facilities, including a certification
statement advising the person signing the form that, under 18 U.S.C.
1001, anyone who makes a materially false, fictitious, or fraudulent
statement to the U.S. Government is subject to criminal penalties. We
intend to include a similar certification statement on paper forms that
will be available for qualified facilities that choose to submit by
paper rather than through the electronic system. The electronic and
paper submission forms will focus on the attestation statements rather
than on other requirements to which the facility is subject. The Small
Entity Compliance Guide that we will issue in accordance with section