(Comment 528) One comment, referencing the requirement in section
204(d)(1)(K) of FSMA that FDA take into account international trade
obligations in developing the proposed recordkeeping requirements,
asserts that because the majority of the seafood consumed in the United
States is globally sourced, the rule will have a major impact on U.S.
trading partners.
    (Response 528) This final rule applies equally to domestic and
foreign firms that manufacture, process, pack, or hold FTL foods
intended for distribution in the United States. In certain industries,
such as seafood, where the majority of the product consumed in the
United States is imported, we recognize that many foreign firms will be
affected. When proposing the rule and in considering comments before
finalizing the rule, consistent with 204(d)(1)(K) of FSMA, we have
taken into account international trade obligations and, as stated
earlier, we believe the subpart S requirements are consistent with our
international trade obligations. Also, as discussed earlier, the final
rule provides flexibility in how firms comply with the requirements and
affords a partial or full exemption to certain small entities,
including foreign small entities.
    (Comment 529) One comment maintains that because data collection
and maintenance require manpower, resources, and time, the requirement
to collect and maintain detailed information may negatively impact
trade and present a particular burden for small farms and businesses.
To address these concerns, the comment suggests that we narrow the rule
to require only records related to food safety concerns. For example,
the comment suggests that information about raw material sources and
suppliers should be adequate, while the quantity of material received
may not be directly relevant to food safety and should not be required.
    (Response 529) Subpart S will enhance food safety by ensuring that
covered entities maintain and provide information that will promote
fast and effective traceability in response to foodborne illness
outbreaks. As discussed in Sections III.C and V.C.5 of this document,
in response to comments, the final rule includes several changes to
streamline and better define the KDEs required for each CTE. The KDEs
specified in the rule contain information that is essential for
adequate traceability. With respect to the quantity of food received,
we believe this information is important to record (regardless of
whether the food is a raw material) because it helps us understand the
amount of food we might need to locate in traceback and traceforward
efforts when conducting an outbreak investigation or recall. We
recognize that meeting the rule's requirements may not be feasible for
certain entities with limited resources, which is why the rule affords
certain entities a full or partial exemption.
4. Implementation and Enforcement
a. General
    (Comment 530) Several comments encourage FDA to adopt an ``educate
while we regulate'' approach to enforcing the final rule, asserting
that the rule is complex and will require much time and effort to come
into compliance. Some comments express appreciation that we took this
approach with other food safety regulations implemented in accordance
with FSMA, such as the produce safety regulation, and request that we
take a similar approach with this rule. One comment asserts that
inspections that are educational in nature will encourage the
development of a positive food safety culture. One comment asserts that
meeting the requirements will be a significant undertaking for all
covered entities, but particularly for smaller growers and producers.
One comment maintains that our implementation of the rule will require
further cooperation with industry and asserts that creating more
interconnected recordkeeping systems will require time, resources,
guidance, and patience.
    (Response 530) Consistent with our approach for other FSMA
regulations, including those on produce safety, preventive controls for
human and animal food, FSVP, and intentional adulteration, we intend to
take the approach of educating before and while we regulate. We
recognize that significant outreach, education, and technical
assistance will be essential to facilitating industry's understanding
of the rule. This approach of educating before and while we regulate
aligns with the Agency's New Era of Smarter Food Safety blueprint (Ref.
18), which envisions ongoing collaboration and dialogue between FDA and
industry to enhance food traceability, support the food safety system,
and improve food safety culture.
    We are currently considering the best approach for structuring and
conducting

records inspections under this rule. Once the compliance date arrives,
we expect to conduct routine records inspections to ensure that
entities subject to subpart S are satisfying the basic requirements.
Routine records inspections primarily will focus on understanding an
entity's subpart S recordkeeping practices, identifying any gaps in
compliance, and achieving compliance through prompt voluntary
corrective actions if we observe deficiencies. In exigent circumstances
(e.g., foodborne illness outbreaks, recalls, or other food safety
emergencies), we may request specific subpart S records from covered
entities to facilitate a traceback or traceforward operation. As with
other FSMA regulations, we may consider taking appropriate compliance
or enforcement action to address non-compliance when necessary to
protect the public health.
    We recognize that complying with these traceability recordkeeping
requirements may pose challenges for many persons subject to the rule,
particularly smaller entities and entities in sectors of the supply
chain that we do not regularly inspect. Section 204(h) of FSMA requires
FDA to issue an SECG within 180 days of promulgation of the final rule
to assist small entities, including farms and small businesses, in
complying with the requirements of subpart S. We also expect to provide
additional information to stakeholders about the rule, and to engage in
outreach, education, and technical assistance to assist the affected
sectors of the food industry. In response to comments regarding the
length of time needed to come into compliance with the rule, we have
extended the compliance period we initially proposed by 1 year, to 3
years after the effective date of the final rule (see Section VI of
this document).
    We have engaged with stakeholders throughout this rulemaking
process and will continue to do so as firms prepare to come into
compliance. Concurrent with issuance of the proposed rule, we provided
information and supplementary materials on our website, such as
information on exemptions, key terminology, supply chain examples, and
a pre-recorded webinar discussing the proposed requirements. In
accordance with section 204(d)(4) of FSMA, we held three public
meetings during the comment period to provide persons in different
regions an opportunity to comment. During these public meetings we
discussed the Agency's commitment to educate industry before and while
we regulate, in line with our overall approach to implementing FSMA. In
addition to outreach and guidance we intend to provide (see Section
V.U.5 of this document), we note that FDA's TAN is a resource for
covered entities with questions related to this rule. Inquiries are
answered by FDA information specialists or SMEs who provide a central
source of information to support industry understanding and
implementation of FSMA standards. The TAN staff have compiled answers
to frequently asked questions on the proposed rule (available on our
website) and will continue to respond to questions now that we have
issued the final rule.
    (Comment 531) One comment maintains that the proposed rule seems
similar to the FSVP regulation in that it can be monitored using
document-based records requests. The comment asks that we publish a
list of required records like the checklist the Agency published for
FSVP.
    (Response 531) The ``Foreign Supplier Verification Programs for
Importers of Food for Humans and Animals (FSVP) Regulation Records
Requirements'' document to which the comment referred is a list of
records required under the FSVP regulation, organized by sections of
that rule, to help importers determine the records they are required to
maintain under that regulation (Ref. 32). The FSVP regulation requires
importers to verify that foods they import into the United States have
been produced in a manner that meets applicable U.S. food safety
standards, and requires importers to conduct a hazard analysis,
supplier verification, and other activities, in addition to maintaining
required records. In contrast, subpart S is entirely focused on the
maintenance and provision of records relating to traceability. As
previously stated, we intend to issue an SECG in accordance with
section 204(h) of FSMA, as well as other materials to assist covered
entities in understanding their obligations under subpart S. We
anticipate that these materials will specify the KDEs and other records
(such as a traceability plan) that entities are required to maintain
and provide under subpart S, though the structure of these materials
may differ from the FSVP document to which the comment refers.
    (Comment 532) One comment asserts that penalizing distributors for
non-compliance with the recordkeeping requirements in subpart S would
not help FDA conduct effective and timely traceback investigations.
    (Response 532) As previously stated, we are developing our
compliance and enforcement strategy for the final rule. While any
strategy we adopt will include taking compliance or enforcement action
when needed to correct problems that put consumers at risk, it will
also include actively supporting education and technical assistance
efforts for persons subject to the rule. Where appropriate, regulatory
actions we take in response to violations of subpart S, whether by
distributors or any other type of entity subject to the rule, will be
aimed at gaining compliance through voluntary corrective actions, as
has been the case with our implementation of other FSMA regulations. As
previously stated, we plan to educate industry before and while we
regulate to assist firms in understanding the rule. We intend to use
our standard regulatory inspection tools, including discussing
violations at the time of our review of records, to inform covered
entities of violations of the rule as they are observed and to provide
firms with a reasonable opportunity to comply.
    (Comment 533) One comment requests that we clarify who may be held
responsible if a traceback investigation fails during an outbreak.
    (Response 533) During an outbreak investigation, our objective is
to obtain information as quickly as possible to help identify the
source of contamination and remove potentially contaminated product
from the marketplace. To effectively implement the final rule, it is
important that all supply chain entities subject to subpart S comply
with the applicable requirements of the rule. If we encounter non-
compliance with subpart S during the course of a traceback
investigation, we will consider the specific circumstances of the case
in deciding whether to take compliance or enforcement action. Some of
the factors we look at in making this decision include whether the
entity took prompt, voluntary corrective action when given the
opportunity to do so, and whether the entity has a history of non-
compliance.
b. Jurisdictional Issues and Coordination With Other Regulatory
Authorities
    (Comment 534) Some comments ask how we will coordinate with other
federal agencies that share jurisdiction over seafood and use existing
data systems to facilitate supply chain transparency and food
traceability. The comments recommend that we enter into agreements with
our federal partners to identify best practices and coordinate seafood
oversight and inspection programs. The comments also suggest that we
ensure interoperability between agency data

systems so that any data the seafood industry submits to the various
systems is accessible to all federal agencies responsible for seafood
oversight.
    (Response 534) We agree that coordination with other federal
agencies, where appropriate, is important to effective regulation of
seafood. FDA has a Memorandum of Understanding (MOU) with the National
Marine Fishery Service's Seafood Inspection Program in NOAA (Ref. 33),
which includes recognizing our mutual regulatory responsibilities and
sharing information on regulatory priorities. As we proceed with
implementation of subpart S, we will continue to collaborate with NOAA
and other federal agencies on data and information sharing and
integrating systems as appropriate.
    (Comment 535) Some comments ask that we clarify which regulatory
authorities are responsible for compliance and enforcement activities
regarding the rule. The comments assert that the subpart S requirements
overlap with other regulations and implicate other regulatory
authorities besides FDA, such as State agencies. Some comments request
that we clarify the jurisdictional boundaries between FDA and State
agencies and ensure coordination of inspections under the regulation to
avoid overburdening farms and first receivers. One comment asks whether
subpart S records will be inspected by FDA investigators or FDA-
credentialed State investigators. Some comments recommend that we place
primary responsibility on State agencies to conduct oversight and
enforcement activities at produce farms. These comments also request
adequate training and funding for State agencies if we expect subpart S
to be enforced during routine inspections of farms. Some comments
assert that we will need to partner with State and local regulatory
agencies to conduct oversight activities for growers and retailers,
adding that it would be unfair and potentially counterproductive to the
goals of the regulation if we limited our activities to the food
facilities we typically inspect.
    (Response 535) We currently are considering the best approach for
structuring and conducting inspections for compliance with the subpart
S recordkeeping requirements, including the roles that FDA and State
investigators should play. We recognize many entities may prefer that
traceability rule inspections be conducted as part of an inspection for
compliance with other regulatory requirements, such as the regulations
on produce safety or preventive controls for human food, and we
anticipate that we might seek to take this approach. Regarding RFEs and
restaurants, we expect that we will work with our SLTT partners to
consider mechanisms for conducting routine traceability records checks.
    With respect to inspections of farms, FDA has a Cooperative
Agreement Program (CAP) with State agencies for implementing the
produce safety regulation (referred to as the ``State CAP''). Not all
50 States participate in inspections of farms under the CAP, and in
those States that do not, FDA is responsible for inspections. We also
are responsible for inspecting foreign farms, and we lead inspections
of sprout growers. Incorporating review of traceability records into
regular produce safety regulation inspections is one option for
inspecting for compliance with subpart S. This could be accomplished,
for example, by adding traceability inspections to the State CAP for
produce and providing additional funding to the States to do this work.
As we have done with regard to the produce safety regulation, we likely
would offer training on the subpart S requirements to State regulators
as appropriate to the inspection model. Even if a State CAP includes
regulatory oversight and inspectional responsibilities, we might still
be involved with compliance and enforcement. However, if a State CAP
does not exist or a program does not include regulatory oversight, we
would be responsible for conducting inspections and carrying out
compliance and enforcement activities.
    (Comment 536) Some comments recommend that we work with State and
Federal authorities to clarify the roles during foodborne illness
investigations. These comments assert that the federal government
should build on existing cooperative relationships to ensure the
efficient enforcement of the subpart S requirements. The comments
recommend that we develop codes to clarify responsibilities and to
assist with enforcement and oversight by State regulators.
    (Response 536) Our SLTT and other regulatory partners play an
important role in helping to ensure food safety in the United States.
We routinely work with our regulatory partners to address activities
affecting the safety of food, and we intend to continue to leverage
existing partnerships and agreements as we implement the subpart S
requirements. We will work with our regulatory partners to clarify
oversight responsibilities, consider whether additional codes are
necessary, reduce redundancy, and consider all tools that will promote
effective implementation of the rule.
c. Retail
    (Comment 537) Some comments encourage us to conduct enforcement
activities at the points of the supply chain where food products are
provided to consumers; other comments request clarification on how we
will monitor compliance at the retail level. Some comments assert that
problems with traceability have historically arisen when foods are sold
by restaurants, retailers, and on e-commerce platforms, which are
entities that often have not been subject to previous FDA oversight.
Some comments assert that enforcing the requirements at the ``last
mile'' will improve traceability for products with short shelf-lives.
    (Response 537) Under Sec.  1.1345 of the final rule, RFEs and
restaurants will be required to maintain KDEs as receivers of FTL foods
unless they meet the criteria for an exemption from subpart S. Being
able to trace an FTL food quickly through the supply chain from the
point of service is a key purpose of the rule, and having access to the
traceability lot code for a food at the end of the supply chain is
critical to achieving that goal. We are considering several approaches
to regulatory oversight at the retail level, including partnering with
SLTT and other regulatory officials to conduct routine traceability
records checks. As previously stated, we plan to educate industry
before and while we regulate to assist firms, including RFEs and
restaurants, in understanding the rule. We recognize the complexities
of regulation at retail, and we intend to fully leverage our
partnerships to help RFEs and restaurants understand and comply with
the rule.
    (Comment 538) Some comments ask that we provide State and local
agencies with resources to address the financial burden associated with
oversight of RFEs if we expect those agencies to educate RFEs regarding
the subpart S requirements and conduct monitoring and enforcement
activities. Some comments ask when we will provide training for
investigators and whether FDA investigators and state-credentialed
investigators will receive the same training.
    (Response 538) We expect to build on our existing collaboration
efforts and mechanisms with SLTT officials in the development of tools
and training for use by inspectors and investigators. We appreciate the
concerns about the potential resource needs associated with oversight,
industry education, and staff training with our SLTT partners. We

will consider obtaining additional funding for our regulatory partners
through various mechanisms, such as grant programs. We anticipate that
FDA and State investigators, as well as other partners conducting
inspections, will receive joint training and education on the subpart S
requirements using existing training programs.
d. Regulatory Parity
    (Comment 539) Some comments ask us to administer the regulation
equally across all segments of the food supply chain. The comments also
request that we not focus our regulatory oversight activities solely on
domestic entities that may already be familiar with traceability. The
comments maintain that doing so would be unfair and could adversely
affect the rule's ability to achieve one of its principal goals, that
of ensuring faster product traceability during outbreaks.
    (Response 539) The final rule applies to all persons who
manufacture, process, pack, or hold FTL foods, unless an exemption
applies, including both persons in the United States and those in other
countries. As with all of our FSMA-related enforcement efforts, we
intend to apply our oversight resources for the traceability
recordkeeping requirements in a risk-based manner, placing greater
emphasis on violations that are more likely to result in harm to the
public health. There are likely to be both domestic and foreign firms
that will be considered higher priorities for oversight because of
factors such as having a poor compliance history or handling a high
volume of foods that pose significant safety risks. Although there are
some differences in our enforcement tools and approaches for domestic
and foreign entities, we will conduct our subpart S oversight
activities in a manner that furthers the goals of the regulation
without unfairly focusing on either domestic or foreign firms.
    (Comment 540) Some comments express concern that we will enforce
the requirements against entities located in foreign countries and
assert that, while all entities should follow the regulation, we should
only hold U.S. importers directly responsible for violations.
    (Response 540) We do not agree. Foreign entities covered by subpart
S are responsible for complying with the portions of the rule that
apply to them, based on the CTEs they perform. As discussed in Response
260, importers might not be subject to the rule, depending on whether
they manufacture, process, pack, or hold any FTL foods; and if they are
subject to the rule, they are only responsible for complying with the
portions of the rule that apply to them, based on the CTEs they
perform. The rule is not structured to hold an importer responsible for
a violation that was committed by a different entity, such as a foreign
supplier.
    When we encounter non-compliance with subpart S, either during a
routine investigation or during an outbreak investigation, we will
generally provide an opportunity for prompt, voluntary corrective
action, as discussed in Response 482. Decisions about enforcement
action--whether against a foreign or domestic entity--will be made on a
case-by-case basis.
5. Outreach and Training
    As discussed in the following paragraphs, several comments request
that FDA conduct outreach efforts and provide guidance, training, and
funding to help entities subject to subpart S understand and comply
with the rule.
a. Outreach and Training Efforts
    (Comment 541) Many comments ask that we provide education,
training, and technical assistance to help industry, including
particular sectors of industry (e.g., farms, RFEs, wholesale
operations, and small and medium-sized firms generally), comply with
the new traceability recordkeeping requirements for FTL foods. Some
comments assert that educating industry will be vital because the rule
will not be effective without industry's strict adherence to the new
requirements. Several comments assert that small and medium-sized
businesses, including farms, are likely to be adopting traceability
systems for the first time and will therefore require training and
technical assistance from FDA to help them comply with the rule. One
comment maintains that because the rule introduces new terms (e.g.,
``key data element,'' ``critical tracking event''), compliance will
require education and training. One comment maintains that any
introduction of new terminology has consequences to industry and can be
especially disruptive to small businesses that lack resources necessary
to undergo extra training and hire consultants, and that may have a
more limited capacity to adapt and implement new procedures. The
comment asserts that the introduction of new requirements
disproportionately benefits the largest producers because
implementation requires investment in outside experts and management
systems, adding that this is particularly concerning when new terms and
rules are introduced without education, training, and support for small
producers and independent retailers.
    (Response 541) We agree with the comments on the importance of
conducting outreach to ensure that all sectors of the supply chain are
aware of the traceability recordkeeping requirements for FTL foods, as
well as providing education to help farms and firms come into
compliance with the new requirements. To that end, we are developing
communications and educational materials covering all aspects of the
rule to assist covered entities of all types, sizes, and levels of
traceability expertise. As previously stated, these educational
materials will include an SECG setting forth in plain language the
subpart S requirements to assist small entities, including farms and
small businesses, in achieving compliance. Although we do not agree
that this rule benefits larger firms to the disadvantage of smaller
ones, we understand that smaller firms may need additional assistance
in understanding and implementing some aspects of traceability that
larger firms may already have adopted.
    (Comment 542) Some comments maintain that education and training is
especially important for firms that have not been subject to other
regulations adopted in accordance with FSMA. One comment states that it
will be a challenge to identify all entities subject to the rule to
ensure they receive appropriate education because the rule covers some
entities that are not subject to other FSMA requirements, such as
``qualified facilities'' under the produce safety regulation. Some
comments suggest that outreach during implementation is essential
because companies are at different stages of implementation of
traceability recordkeeping due to various factors, including customer
demand, compliance with trading partners, and other regulations.
    (Response 542) We agree that it will be particularly important to
provide education and training to firms that have limited experience
with other FSMA regulations and to firms that do not already have
robust traceability systems, as well as firms that operate
internationally and therefore might also be subject to traceability
requirements of foreign countries that may differ from this rule. We
also agree that it would be challenging for us to reach all covered
entities directly. Therefore, we will extensively engage public and
private entities such as State departments of agriculture, industry
trade groups, and other stakeholders to share communications and
outreach materials for the rule. Although we have tried to

align the subpart S requirements as much as possible with traceability
systems, procedures, and terminology already used by industry, we
realize that some firms keep different records and provide different
tracing information to their customers, which heightens the importance
of clearly explaining and illustrating the requirements in the final
rule. Again, we intend to extensively engage with public and private
entities to share information on the traceability regulations in a
timely fashion to assist both domestic and international firms during
implementation.
    (Comment 543) Some comments suggest that FDA provide training for
the entire industry, including foreign firms, because new requirements
differ from firms' current procedures and practices and from
regulations in foreign countries. Some comments maintain that outreach
to foreign firms is important because the compliance status of many
U.S. businesses will depend on these firms, and that without such
outreach the burden to educate, develop digital capabilities, and
promote compliance will fall to industry. Some comments ask that we
provide resource materials in multiple languages to help educate the
international community about the rule.
    (Response 543) We agree there is a need to conduct outreach to
foreign entities that will be subject to the subpart S requirements.
Among other things, we intend to provide resource materials in multiple
languages, work through entities such as the USDA Foreign Agricultural
Service and interested embassies to provide outreach to covered foreign
entities, and work through associations that serve the U.S. importer
and U.S. agent communities, since they may be in dialogue with their
foreign suppliers about the requirements of the rule.
    (Comment 544) One comment maintains that proper lot code
stewardship throughout the supply chain is a departure from current
business practices that will require targeted education and training to
achieve.
    (Response 544) We agree. Given the importance of traceability lot
codes in the subpart S requirements, we anticipate that assignment,
maintenance, and provision to customers of traceability lot codes will
be a key focus of education and training efforts regarding the rule.
    (Comment 545) One comment asks that we provide a timetable for the
provision of training and resources to ensure compliance.
    (Response 545) We will begin to provide resource materials as soon
as the final rule issues and will continue to do so up to and after the
compliance date. We will try to provide as much outreach and training
to covered entities as possible before the compliance date, and
thereafter we will continue to engage with industry to promote a full
understanding of the rule.
b. Guidance Documents, Templates, and Other Written Materials
    (Comment 546) Several comments ask that we provide industry with
guidance, forms, spreadsheets, and other written materials to aid
understanding of, and compliance with, the traceability recordkeeping
requirements in the final rule. Several comments request that we issue
a guidance document on the requirements; some comments ask that the
guidance include model traceability information to demonstrate how to
implement the rule. Some comments ask that we provide more examples and
real-life scenarios in the preamble to the final rule or in guidance.
Some comments request that we provide examples of the KDEs that would
be required at each step in the supply chain for frozen fish products,
for both wild-caught and farm-raised fish. One comment suggests that we
identify appropriate SMEs for each FTL food to help develop
implementation guidance.
    (Response 546) We agree that communication, training, and
educational materials should take multiple forms and include industry-
specific examples and real-life scenarios. We intend to develop an
array of materials, taking into consideration the suggestions provided
in the comments.
    (Comment 547) One comment asks that we consider issuing guidance to
link the traceability code with ultimate point of consumption data,
such as shopper cards or credit card information. The comment maintains
that being able to link a lot of a food with customer information is
useful in limiting the scope of recalls, feasible given current
practices, and would further protect public health by improving the
ability to notify any impacted entities.
    (Response 547) We do not believe guidance on the use of consumer
data is necessary because the rule does not require firms to keep
information on sales to consumers and does not require maintenance of
records linking traceability lot codes for FTL foods received from
manufacturers or distributors with sales of such food to consumers.
However, we recognize that individual RFEs and restaurants might choose
to use customer data (e.g., data obtained from a membership card) to
help with outbreak investigations and recall implementation. In general
we encourage firms to consider adopting traceability practices that go
beyond the requirements of subpart S, if such practices are suited to
the firm's specific circumstances.
    (Comment 548) Several comments request that we develop and make
available templates for records that firms might use to maintain and
send traceability information required under the rule. Several comments
ask that we develop an electronic spreadsheet that firms could use to
record the KDEs for the relevant CTEs for their FTL foods, as well as
to meet the requirement in proposed Sec.  1.1455(b)(3) to provide
information in an electronic sortable spreadsheet in certain
circumstances. The comments maintain that the availability of such a
template would help FDA know where to look for critical information in
an investigation and would provide guidance to firms as to what records
they must keep under the rule. One comment asserts that the Leafy
Greens Pilot completed in 2020 demonstrated the critical importance of
template review and stakeholder education to maximize efficacy. Some
comments ask that we develop spreadsheet templates that include
examples of supply chains of different lengths and levels of
complexity. One comment maintains that having examples for each FTL
food category would be valuable to industry, as the supply chain
realities for cantaloupes would be quite different than those for deli
salads or finfish. This comment suggests that we issue a template that
demonstrates how traceability lot codes are preserved alongside other
adjacent business-relevant coding that may still be required for the
effective operation of certain supply chains. One comment maintains
that having an official template could influence software and business
process design, including enterprise resource planning, traceability
system design, and sourcing and procurement practices. One comment
suggests that we provide electronic reporting templates that
acknowledge the current digital reality, particularly regarding what it
means to ``establish and maintain records.'' One comment requests that
we provide sample forms and spreadsheets specifically for use by farms.
One comment suggests that templates would be helpful in demonstrating
third-party logistics companies' role in traceability.
    (Response 548) While we do not intend to issue an ``official''
template for an electronic sortable spreadsheet or any other document
that all firms must use to meet subpart S requirements, we

understand that many firms might like to see examples of forms and
formats they might use to comply with the rule, and we intend to make
such examples available as part of the resource materials for
compliance with the rule.
    (Comment 549) Some comments ask that we update the supporting
materials for the proposed rule that we had posted on our website,
while other comments ask that we incorporate into the final rule our
responses to ``Frequently Asked Questions'' (FAQs) about the proposed
rule (which we also have posted on our website).
    (Response 549) We have updated the materials on our website. We
have addressed many issues raised in the FAQs in the preamble to the
final rule, and we expect to continue to update our website as we
develop additional materials (such as the SECG) and as we receive
questions about the final rule.
    (Comment 550) One comment asks that we test the assumptions made in
the PRIA and develop a return on investment (ROI) model with
representative company types/sizes that we would provide to industry as
a cost calculator to help encourage compliance with the rule.
    (Response 550) Although we have analyzed the benefits and costs of
the rule in the FRIA (Ref. 16), it is not appropriate or feasible for
FDA to develop an ROI model for persons subject to subpart S. Firms
subject to the rule might wish to consider conducting their own ROI
analyses to determine what approach (e.g., purchasing new software vs.
updating current traceback SOPs) is most appropriate for their firm as
they come into compliance with the rule.
c. Coordination of Training Efforts
    (Comment 551) Several comments recommend that we coordinate
training efforts with industry associations, universities, and/or State
and local regulatory authorities. For example, one comment suggests
that, similar to the Produce Safety Alliance that has supported
educational efforts for the produce safety regulation, FDA should
establish a ``Traceability Alliance'' in partnership with land grant
institutions and their extension services to ensure that stakeholders
have an appropriate level of education on traceability to successfully
implement the rule. The comment suggests that we collaborate with non-
governmental partners, industry associations, and non-profit technical
organizations to assess industry educational needs and develop
educational content to support the rule. Some comments suggest that we
work with industry experts to assess current practices, infrastructure,
and needs, as well as develop and disseminate implementation guidance.
One comment asserts that FDA followed this approach in its development
and use of the CORE Network. One comment offers to work with FDA and
stakeholders to develop tools to facilitate understanding and
implementation of the requirements, particularly to help less digitized
and smaller-scale supply chain entities. One comment expresses support
for FDA's ongoing work with the leafy greens industry and encourages
similar work with the seafood, shell egg, and dairy/cheese industries.
One comment suggests that we coordinate with cooperative extension
services at the State level, the USDA's National Organic Program, and
farm advocacy groups to develop sample materials and trainings.
Regarding seafood, one comment suggests that we work with the National
Sea Grant College Program of NOAA to develop outreach compliance
programs for unloading docks and fish houses.
    (Response 551) We recognize the importance of partnerships in
ensuring wide distribution and sufficient specificity of training and
educational resources. We are currently developing our outreach and
education approach, including consideration of partnerships with
industry associations, universities, and/or federal, state, and local
agencies on such efforts as appropriate. We will work to ensure that
training materials and dissemination are suited to the needs of the
various types of entities covered by this rule.
    (Comment 552) Some comments criticize the regulation for not
addressing recall modernization. The comments ask that we provide
guidance to industry on how to manage product recalls and request
clarification on what data we will provide to help industry implement a
product recall during a food safety incident. The comments also
recommend that we collaborate on recalls with the direct-to-consumer
and curbside delivery segments of the supply chain to learn about
emerging business trends and potential food safety impacts regarding
consumer-level food traceability.
    (Response 552) While this rulemaking does not address recall
modernization directly, we are working on this issue through other
initiatives. For instance, the New Era of Smarter Food Safety Blueprint
(Ref. 18), which outlines the approach we will take over the next 10
years to build on the work the Agency has done to implement FSMA,
contains a section on ``Recall Modernization within Core Element 2:
Tech-Enabled Traceability.'' Our goals for this initiative include
developing best practices guidance on various consumer notification
practices for different business models to facilitate product recalls.
d. Resources for Outreach and Training
    (Comment 553) Several comments request that we provide funding for
outreach, education, and training efforts. One comment requests that we
provide adequate resources to SLTT agencies to address the financial
burden they will incur by providing educational, compliance, and
enforcement activities regarding the rule for RFEs. One comment states
that the education and outreach efforts conducted regarding the produce
safety regulation have highlighted how important funding for education
efforts is to the adoption of food safety practices. Some comments ask
that we extend the existing CAP programs, including the Local Food
Safety Collaborative and Native American Tribal Cooperative Agreement,
to identify and educate small entities likely to be affected by the new
traceability regulation, and to consider proposing and establishing a
unique CAP for the regulation with the goal of developing appropriate
programming to reach small and very small businesses. One comment
expresses support for a program, similar to the On-Farm Readiness
Reviews conducted by the National State Departments of Agriculture,
that would help growers prepare for compliance with the rule. One
comment requests that we provide funding to educational organizations
to help growers become oriented to, aware of, and compliant with the
rule, and recommends that we engage in this effort with existing
national educational curricula organizations such as the Food Safety
Preventive Controls Alliance and the Produce Safety Alliance. One
comment suggests that we work with other U.S. agencies to provide
resources to help industry comply. One comment maintains that while the
rule is forward-thinking and important, it presents possible unfunded
mandates.
    (Response 553) We are committed to working with our SLTT partners
to address the resource needs associated with implementing the
traceability final rule, including with respect to outreach, training,
and enforcement. We are committed to providing guidance, education, and
technical assistance to SLTT partners and will consider new and
existing channels in an effort to lessen the burden associated with
administering the rule. We also intend to work with other federal
agencies as

needed to enhance education and outreach efforts.
    (Comment 554) One comment asserts that because most entities
affected by the rule are small and medium-sized firms, the need for
additional investment to aid compliance with the rule skews toward
these firms. The comment suggests that because farmers often have
little ability to negotiate higher prices for their commodities, FDA
should work with industry and Congress to find ways to offset costs of
compliance. One comment suggests that additional funding from Congress
is needed to implement the rule, and that funding in the form of
subsidies could also help producers, suppliers, and retailers be more
compliant in tracing efforts.
    (Response 554) We carefully considered costs of compliance when
developing the rule and have attempted to provide maximum flexibility
to persons subject to the rule to meet applicable requirements. We also
have concluded that meeting the requirements of the rule may not be
feasible for some entities, so we have adopted exemptions for certain
types of small entities. We cannot comment on efforts in Congress to
provide funding for producers, suppliers, retailers, and other entities
to improve their traceability capability.
e. Funding for Equipment and Technology
    (Comment 555) Several comments ask that we provide financial
assistance to help entities subject to the rule purchase equipment
(such as scanners), software, and training needed to comply with the
rule. Some comments suggest that many farms and food producers may
discover that they need to invest in alternate technology systems to
meet the recordkeeping requirements. One comment maintains that if the
electronic sortable spreadsheet is an integral part of FDA's approach
to improved traceability, the Agency should provide funding for
education for computer literacy and adoption of digital recordkeeping
practices, or provide a 24-hour, third-party technical assistance
service to help farms comply. One comment asks if we will provide
financial assistance and training or grants to help firms purchase new
equipment as part of the New Era for Smarter Food Safety initiative.
Some comments suggest that we follow the model established by Canada,
under which British Columbia Traceability Funding Programs refund up to
70 percent of investments that firms need to make to comply with
Canadian traceability requirements.
    (Response 555) FDA is not in a position to provide financial
assistance to help covered entities purchase or upgrade equipment they
might choose to use to comply with the rule. Nevertheless, we are
exploring ways to assist firms in adopting tracing technologies and
harmonizing tracing activities, such as the previously mentioned Low-
or No-Cost Traceability Challenge, in which we encouraged stakeholders
to develop traceability hardware, software, or data analytics platforms
that are low-cost or no-cost to the end user. We will continue to
search for and highlight these and other approaches to help provide
economical options for traceability.
6. Grocery Returns
    (Comment 556) One comment expresses concern that because of
advanced traceability, grocery returns may need to be eliminated to
ensure accurate traceability, but doing so would result in more food
waste going into landfills.
    (Response 556) Sales or shipments to consumers are not covered by
the rule, so we do not anticipate that grocery returns will be impacted
by the rule.
7. Performance Metrics
    (Comment 557) One comment asks that we identify metrics to measure
the success of the food traceability rule. The comment suggests that
expert panels and industry could use the metrics to understand how the
rule is impacting public health and what foods should be included on
the FTL.
    (Response 557) As we have done for other FSMA rules, we will
consider appropriate performance metrics for the subpart S regulation
as part of our implementation of the rule.
    (Comment 558) One comment states that all parties should feel that
proprietary or otherwise sensitive company information can be protected
in the data collection and submission process, and suggests that FDA
provide a direct portal and set of application programming interfaces
for submission of data, along with a list of approved third parties to
facilitate compliance with the proposed rule, based on open and
interoperable standards.
    (Response 558) As discussed in Response 412, we have made changes
to the final rule to address concerns about disclosure of proprietary
or sensitive information, in particular by including an option to
provide receivers of FTL foods with a traceability lot code source
reference instead of the traceability lot code source itself. We are
developing a portal for submission of traceability information to us,
which will protect the confidentiality of the information provided. We
do not intend to ``approve'' or assess the capability of third parties
who might perform recordkeeping or information transmission on behalf
of entities subject to subpart S requirements.

VI. Effective and Compliance Dates

    In the proposed rule, we proposed that the final rule would become
effective 60 days after the date on which the rule is published in the
Federal Register. We also proposed that the compliance date for all
persons subject to the subpart S recordkeeping requirements would be 2
years after the effective date of the final rule.
    We received no comments opposing the proposed effective date for
the final rule. As proposed, the final rule will become effective 60
days after the date on which the rule is published in the Federal
Register. However, in response to comments received, we are revising
the compliance date to 3 years after the effective date of the final
rule, as discussed in the following paragraphs.
    (Comment 559) Many comments request that we extend the proposed 2-
year compliance period after the effective date of the rule to other
timeframes, including 3, 4, or 5 years after the effective date. The
comments maintain that extending the compliance date would allow
covered entities time to understand the requirements of the rule,
purchase or update tracing technology, train staff, coordinate with
supply chain partners, and establish or update recordkeeping systems.
One comment maintains that a 3-year compliance date would be
appropriate because it is the timeframe that the smallest covered
entities had to comply with the final rule on preventive controls for
human food. Comments requesting a 4-year compliance period or longer
emphasize that data standardization would be time-consuming, including
the time needed to invest in new technology systems, convert from paper
to electronic, and ensure that foreign suppliers also have adequate
systems. One comment maintains that a public-private partnership may be
necessary to oversee data standardization, which would take time to
establish. Several comments assert that 2 years is not enough time
given all the preparation needed to comply but did not specify an
alternative timeframe.
    (Response 559) We agree that persons subject to the rule should
have additional time to come into compliance with the subpart S
requirements. Therefore, we are revising the compliance date for all
covered entities

to 3 years after the effective date of the final rule. We believe this
3-year timeframe appropriately balances the public health gains through
traceback efficiencies we expect to achieve through implementation of
this rule against the need for covered entities to have adequate time
to come into compliance with the new traceability requirements. The
overwhelming majority of comments on the compliance date request more
than 2 years to come into compliance, maintaining that they will need
to work with suppliers to understand how information will be sent to
them, possibly switch from paper to electronic records and/or purchase
new equipment and software, redesign tracing systems to capture
information that current systems do not, and work with foreign
suppliers to ensure they understand the requirements for keeping and
providing necessary records. Given the need for these activities, among
others, to occur, we are persuaded that compliance in a 2-year
timeframe would be challenging. Therefore, while the 3-year timeframe
does postpone the anticipated public health gains from the rule by a
year, we conclude that this postponement is justified. However, given
the public health benefits expected from adoption of the new
traceability requirements, we do not believe it would be appropriate to
extend the compliance date beyond 3 years.
    FDA believes the 3-year compliance timeframe allows an appropriate
amount of time for firms to conduct activities necessary for them to
come into compliance. Covered entities can work with supply chain
partners in the 3-year timeframe to understand how information will
flow forward through the supply chain and work out any needed written
agreements or protocols for how information will be shared among
entities, such as between harvesters/coolers and those performing
initial packing. The additional year beyond the proposed 2-year
compliance date will extend the time in which industry can establish or
make any changes to tracing systems and make decisions around
purchasing new equipment--activities that cannot begin until there is
an understanding of the requirements of the final rule. The additional
year will also allow time for the development of software and related
products aimed at facilitating compliance with the rule, which multiple
technology companies have expressed an interest in developing. It is
possible that the 3-year timeframe will mean that some of the costs for
technology solutions will be reduced compared to a 2-year compliance
date, given the additional development and implementation time. The 3-
year timeframe will also allow for time for any collaboration that
industry might decide to undertake, to consider how they want to share
information with each other; we will consider how we might assist
industry with such efforts.
    The 3-year compliance period will also allow more time for us to
develop and disseminate outreach and training materials to
stakeholders, including webinars focused on various industry segments
and materials specifically targeted to smaller covered entities. As we
have done with the previous FSMA rules, we plan to provide a variety of
outreach and training materials for this final rule. For all of the
aforementioned reasons, we believe that a compliance date 3 years after
the effective date (which itself is 60 days after the date of
publication of the final rule) strikes the right balance between
achieving traceback efficiencies as quickly as possible and allowing
sufficient time for covered entities to come into compliance with the
new tracing requirements.
    (Comment 560) Several comments request that the compliance date
occur after FDA has issued all relevant guidance documents related to
the rule so that covered entities can fully comply with regard to their
own covered foods and also work with foreign suppliers.
    (Response 560) We will work to issue any guidance documents related
to this rulemaking as expeditiously as possible. However, the process
for issuing both draft and final guidance documents can be lengthy, and
the timing is often beyond our control. Therefore, we are unable to
ensure that all relevant guidance documents related to the rule will be
issued before the compliance date. However, we note that section 204(h)
of FSMA requires us to issue an SECG not later than 180 days after
promulgation of this final rule. The SECG will set forth, in plain
language, the requirements of subpart S, with the goal of assisting
small entities, including farms and small businesses, in complying with
these new requirements.
    (Comment 561) Several comments request that the compliance dates be
phased in by business size. These comments state that extra time would
be needed for small businesses to become educated about the rule and
make investments, or seek assistance to make investments, in personnel
and technology to come into compliance. Some comments suggest that
small businesses be given 4 years to comply and all other businesses be
given 3 years. Other comments suggest that certain categories of
covered entities would need additional time to come into compliance,
including the following: (1) importers who may need extra time to work
with foreign suppliers; (2) retailers who may need additional time
because they are at the end of the supply chain, and therefore need
time to understand how information will come to them from a variety of
sources and create systems to maintain the information; (3) grower/
packers who may need extra time to adopt new technology and
distributors who may need time to understand how suppliers will be
providing information and develop appropriate interoperable technology
systems; and (4) the seafood industry, which might need additional time
to develop software, conduct training activities, and translate
materials due to the global nature of the seafood supply chain. One
comment suggests that those entities that establish traceability lot
codes should have to comply initially, and then entities that only ship
and/or receive FTL foods should have a later compliance date; the
comment maintains that this would provide that the nodes that will be
producing most of the data would have to comply first. The comment
further suggests that entities that establish traceability lot codes
and have 500 or more employees should be expected to comply within 2
years, while smaller businesses that establish traceability lot codes
and have fewer than 500 employees could be afforded an additional year.
Finally, the comment suggests that entities that solely receive and
ship products be allowed another year after that to come into
compliance.
    (Response 561) We decline to phase in the compliance date for the
subpart S requirements by business size or type of covered entities. In
the preamble to the proposed rule (85 FR 59984 at 60020), we explained
that we could more effectively and efficiently implement the new
requirements by having all covered persons come into compliance by the
same date. Subpart S operates via a chain of information being
maintained and passed forward through covered entities in the supply
chain. If an entity in a supply chain did not provide the required
information to their customer, the chain would be broken and the rule
would operate less efficiently; this would be particularly true if the
entities assigning the traceability lot codes had to comply first, but
subsequent supply chain members were not yet required to pass the
information forward through the supply chain. Even if the compliance

dates were staggered based on the type of food (such as the delayed
compliance date for seafood that was suggested in the comments), we
anticipate that complications would arise for entities that handle both
FTL seafood and other FTL foods (or multi-ingredient foods with seafood
ingredients), as well as fairness concerns from other industries that
face challenges similar to those faced by the seafood industry.
    Staggering compliance dates would delay the benefits of the rule
gained through efficient traceback until all covered entities reached
their respective compliance date. Staggering the compliance dates would
also make efficient implementation of the rule more challenging for
covered entities, and might introduce additional complications and
questions about who is required to comply when, and what ``compliance''
looks like when the compliance date has not yet arrived for a firm's
supply chain partners. One of the reasons we are adding a year to the
compliance date timeframe is to give covered entities more time to work
together to understand how information will be shared under the rule;
staggering the compliance dates would make that collaboration more
difficult because covered entities would be at different stages in
their compliance dates.
    (Comment 562) One comment suggests that retailers and other covered
entities should not be made to comply until FDA has partnered with
industry to conduct pilots related to interoperability and public-
private data sharing, such as testing approaches to implementing
industry-wide traceability so that it is clear what covered entities
need to do to successfully comply with the rule. Similarly, several
comments suggest that because of the complexity of the rule and
confusion about the scope and intended operation of the rule, we should
implement the rule in phases by commodity, beginning with an initial
test or pilot phase for the highest-risk commodities such as (according
to the comments) leafy greens or some produce items. The comments
suggest that compliance with the rule for all other commodities on the
FTL would follow after experience has been gained with the initial
commodities. The comments maintain that this initial phase would allow
FDA and industry to establish traceability for the highest-risk
commodities, while assessing whether the system will work as intended
or whether further refinements need to be made before a second phase of
implementation.
    (Response 562) We decline to delay the compliance date until pilot
implementation tests have been conducted or to begin with a pilot phase
with certain commodities. As discussed in Response 559, we are adopting
a 3-year compliance date for all covered entities, and we believe that
this time period will be sufficient for covered entities to
successfully comply with the rule. While we may conduct pilot programs,
any such programs are likely to happen during the 3-year compliance
period. We conclude that delaying the compliance date for an
indeterminate amount of time while pilots are conducted is not
appropriate given the anticipated public health benefits to be gained
through traceback efficiencies.
    (Comment 563) Several comments request that the compliance dates be
phased in by node in the supply chain. These comments suggest that
because downstream entities cannot comply until upstream entities send
them information, the first compliance dates should be for the upstream
entities, with downstream entities, particularly those handling product
with a longer shelf life, assigned a later compliance date or given
enforcement discretion until they have an opportunity to understand
what type of information they will be receiving. One comment suggests
that this would be similar to how FDA is implementing the DSCSA, and
recommends that the Agency be guided by the DSCSA's stepwise approach
and long implementation timeframe in establishing compliance dates for
the food traceability rule. This comment asserts that because the food
industry has fewer resources to devote to regulatory compliance than
the pharmaceutical industry, the food industry should be allowed a
longer time to comply with the tracing requirements. Some comments,
which also reference the DSCSA, recommend a phased approach to
implementation of subpart S that begins by focusing on the most
significant gaps in the subpart J recordkeeping requirements.
    (Response 563) We decline to stagger the compliance date for the
subpart S requirements by node in the supply chain. While it is true
that information must flow ``down'' the supply chain to enable
downstream entities to obtain information they must keep under the
rule, we do not agree that this means the compliance dates for this
rule should be staggered by nodes. The supply chains that are affected
by subpart S vary greatly in terms of their length, complexity, and the
types of activities they involve. An entity such as a distributor might
be the first covered entity in the supply chain for some of the FTL
foods they handle (e.g., for produce that was grown on an exempt farm),
while simultaneously being in the middle of a chain of covered entities
for other FTL foods they handle. There are also many covered entities
that perform multiple CTEs with respect to the FTL foods they handle,
including different CTEs for different FTL foods. Because of this
variation and complexity in supply chains, it would be difficult to
identify the nodes that would be subject to different compliance dates,
and we anticipate that any effort to stagger compliance dates based on
supply chain nodes would generate significant questions from
stakeholders about their obligations for each compliance date. As
discussed in Response 565, we recognize that when the compliance date
arrives, there will be FTL foods in various stages of distribution,
including on store shelves, for which there may not be complete tracing
records, due to the fact that the product was produced before the
compliance date. We will not expect these products to have subpart S
records associated with them if the foods were already in distribution
before the compliance date.
    Regarding the comments suggesting a phased approach to
implementation of subpart S that begins by focusing on the most
significant gaps in the subpart J recordkeeping requirements, we note
that both farms and restaurants are excluded from subpart J (see Sec.
1.327(a) and (b)). To the extent that the comments are recommending
that subpart S compliance or implementation should begin with farms and
restaurants before requiring compliance by other supply chain entities,
we do not think such an approach would be feasible. As discussed in
Response 561, subpart S operates via a chain of information being
maintained and passed forward through covered entities in the supply
chain. If farms and restaurants were required to comply with the rule
before other supply chain entities, this chain would be broken and
implementation of the rule would be more challenging.
    In the DSCSA, Congress specified different times (e.g., 4, 6, or 7
years after the date of enactment) by which some requirements would
have to be met by different types of entities, while other requirements
generally would have to be met by all entities at the same time.
Furthermore, DSCSA requirements concerning the interoperable,
electronic tracing of product at the package level would go into effect
10 years after the date of enactment. While this type of staggering may
be appropriate in the drug tracing context, we decline to adopt it here
for the reasons explained above. Regarding the argument that the food
industry should be given a longer time to comply with subpart S than
the

drug industry is being given to comply with the DSCSA, we do not think
the comparison is apt. The DSCSA requires tracking to the individual
drug package and homogenous case level with consequent labeling
requirements, and also requires interoperable, electronic product
tracing at the package level. Subpart S, by contrast, requires lot-
based recordkeeping that is in line with current industry best
practices, and provides flexibility for individual entities to decide
how they will keep and provide the relevant records, including whether
or not they will choose to adopt electronic recordkeeping. We therefore
think that a shorter compliance timeframe for subpart S is appropriate.
    (Comment 564) Some comments ask that we consider a phased approach
to implementation that extends the compliance date for the electronics
or table spreadsheet requirements in proposed Sec.  1.1455(b)(3) to 4
years after the effective date of the final regulation. One comment
argues that this two-phased approach would give covered entities time
to adopt new terminology and make substantial changes to current
systems. The comment suggests that the first phase of implementation
would consist of entities bringing their records into compliance with
the rule, such that, within 2 years of the effective date of the final
rule, all covered entities would be required to establish and maintain
the records required by the rule and these records would be available
to FDA upon request. The comment maintains that this phased approach
would provide covered entities sufficient time to work with their
supply chain partners and develop the recordkeeping systems necessary
to comply with the rule, while giving FDA access to tracing records in
the proposed timeframe. The comment suggests that in the second phase
of implementation, beginning 4 years after the effective date of the
final rule, firms would have to comply with the requirement to produce
information required by the rule in an electronic sortable spreadsheet.
The comment maintains that a phased approach is preferable because it
allows firms to get their traceability systems in place before
developing a system able to deliver an electronic sortable spreadsheet
to FDA within 24 hours.
    (Response 564) We decline to adopt a separate, extended compliance
date for the electronic sortable spreadsheet requirement in Sec.
1.1455(c)(3)(ii). The majority of the tracing information required
under subpart S will be in the KDE records kept on FTL foods as they
are initially packed or transformed and then shipped and received at
various nodes in the supply chain. Firms will only be required to
provide the electronic sortable spreadsheet when we conclude that
obtaining the information in this format is necessary to help us
prevent or mitigate a foodborne illness outbreak, assist in the
implementation of a recall, or otherwise address a threat to the public
health. Thus, the spreadsheet is not a routine record, but it will be a
very helpful document to FDA during an outbreak or other public health
threat, and it will be critical to achieving the public health gains
anticipated for this rule. We believe allowing 3 years for all covered
entities to establish their tracing protocols and records, including
for generation of the electronic sortable spreadsheet, strikes an
appropriate balance between public health and feasibility. However, we
acknowledge that there is concern about producing the electronic
sortable spreadsheet, including that this could be especially
challenging for smaller entities who may have fewer resources and who
may be more likely to use paper-based tracing systems. Therefore, the
final rule provides exemptions for certain smaller entities from the
electronic sortable spreadsheet requirement as specified in Sec.
1.1455(c)(3)(iii).
    (Comment 565) Some comments ask that we clarify that the tracing
records are not required until after the compliance date. The comments
also note that it might take some time for downstream entities to begin
receiving tracing records from their suppliers, and there will be
products in inventory after the compliance date that were produced and
received before the compliance date. Some comments request that we
implement staggered compliance dates starting with entities at the
beginning of the supply chain and exempt products already in commerce.
Other comments ask us to exercise enforcement discretion for downstream
entities who are unable to comply with the final rule because they do
not have the required information from their suppliers.
    (Response 565) As discussed in Response 561, we decline to
implement staggered compliance dates. We affirm that records required
under subpart S will not have to be maintained until the compliance
date. Furthermore, we recognize that it will take time for downstream
covered entities in supply chains of FTL foods to receive the tracing
records required under the rule for covered products and that, in the
meantime, there will be FTL foods on store shelves and in stages of
distribution for which there may not be complete tracing records, due
to the fact that the product was produced before the compliance date.
This may be of particular concern for FTL foods with a long shelf-life,
such as peanut butter. We will not expect these products to have
subpart S records associated with them if the foods were already in
distribution before the compliance date. As the compliance date
approaches, we will determine whether it is necessary to provide
further clarification on our position regarding these products.
    (Comment 566) Some comments recommend that we encourage industry to
adopt the requirements earlier and engage those companies that do so in
a collaborative recall investigation process that benefits public
health. These comments assert that such engagement could be used
without regulatory action involving participating industry, absent any
wrongdoing, and would incentivize early industry adoption of the
additional recordkeeping practices and there by improve traceback
investigations before the requirements take effect. One comment
requests that any collaborative recall process have clearly defined
roles and responsibilities for fact-finding and types of data sharing
needed, as well as confidentiality during the investigation process.
    (Response 566) We decline to establish a formal process to
recognize early adopters of the tracing requirements in this subpart.
However, we encourage industry to adopt subpart S practices as soon as
practicable, and we agree that implementation before the compliance
date will further benefit public health. As previously stated, we will
consider how we might assist industry with any collaborative efforts
they might decide to undertake regarding information sharing among
supply chain partners to comply with the rule.

VII. Economic Analysis of Impacts

    We have examined the impacts of the final rule under Executive
Order 12866, Executive Order 13563, the Regulatory Flexibility Act (5
U.S.C. 601-612), and the Unfunded Mandates Reform Act of 1995 (Pub. L.
104-4). Executive Orders 12866 and 13563 direct us to assess all costs
and benefits of available regulatory alternatives and, when regulation
is necessary, to select regulatory approaches that maximize net
benefits (including potential economic, environmental, public health
and safety, and other advantages; distributive impacts; and equity).
The Office of Information and Regulatory Affairs has designated this
final rule as an economically significant regulatory action as defined
by Executive Order 12866.

    The Regulatory Flexibility Act requires us to analyze regulatory
options that would minimize any significant impact of a rule on small
entities. Because some small firms may incur annualized costs that
exceed 1 percent of their annual revenue, we find that the final rule
will have a significant economic impact on a substantial number of
small entities.
    The Unfunded Mandates Reform Act of 1995 (section 202(a)) requires
us to prepare a written statement, which includes an assessment of
anticipated costs and benefits, before issuing ``any rule that includes
any Federal mandate that may result in the expenditure by State, local,
and tribal governments, in the aggregate, or by the private sector, of
$100,000,000 or more (adjusted annually for inflation) in any one
year.'' The current threshold after adjustment for inflation is $165
million, using the most current (2021) Implicit Price Deflator for the
Gross Domestic Product. This final rule would result in an expenditure
in at least one year that meets or exceeds this amount.
    This final rule will allow FDA and industry to more rapidly and
effectively trace food products that cause illnesses back through the
food supply system to the source and forward to recipients of the
contaminated product. This rule will only apply to foods FDA has
designated for inclusion on the FTL and foods that contain listed foods
as ingredients that remain in the same form (e.g., fresh) in which they
appear on the list. By allowing faster identification of contaminated
foods and increasing rates of successful tracing completions, the rule
results in public health benefits if foodborne illnesses directly
related to those outbreaks are averted. This might also lead to more
efficient use of FDA and industry resources needed for outbreak
investigations by potentially resulting in more precise recalls and
avoidance of overly broad market withdrawals and advisories for covered
foods.
    The primary public health benefits of this rule are the value from
the reduction of foodborne illnesses and deaths because records
required by the rule are likely to reduce the time that a violative or
contaminated covered food product is distributed in the market.
Benefits from this rule are generated if the following two conditions
hold: (1) a foodborne outbreak occurs and (2) the traceability records
required by this rule help FDA to locate a commercially distributed
violative product quickly and accurately and to ensure it is removed
from the market.
    While the primary benefits from the rule are the value of the
reduction of foodborne illnesses and deaths, we also examine non-health
related benefits. Non-health related benefits of this rule will be from
avoiding costs associated with conducting overly broad recalls and
market withdrawals that affect products that otherwise would not need
to be withdrawn or recalled. Although recalls of rightly implicated
foods come with necessary costs, overly broad recalls that involve
loosely related or unrelated products can make overall recalls
unnecessarily costly. The costs of a broad recall or market withdrawal
include lost revenues from unimplicated products plus expenses
associated with notifying retailers and consumers, collection,
shipping, disposal, inventory, and legal costs.\1\ There are no
benefits from removing unimplicated products from the market. Benefits
from avoiding overly broad recalls may be realized only when recalls
are initiated in response to an FDA public health advisory.
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    \1\ For example, in an undifferentiated product recall, a single
firm's investment in traceability may be ineffective when
competitors and partners have not instituted a traceability system.
This is problematic because, for example, in the event of an
undifferentiated leafy greens outbreak, issuing a broad recall could
be unavoidable, at least until the implicated product is identified
and removed from the market. In situations where the recalled
products are insured, targeted recalls will help prevent unnecessary
recalls of insured products, which may have long-term consequences
to retailers from increases in their insurance rates due to
imprecise recalls.
---------------------------------------------------------------------------

    It is possible, but not certain, that both of these categories of
benefits could be experienced to the extent quantified in table 2 and
the underlying regulatory impact analysis. On the other hand, it is
also possible that a given instance of baseline contamination would
lead to a very broad recall (that could be narrowed by the final rule)
or to illnesses (that could be avoided due to the final rule) but not
both.
    Additional benefits of the rule may include increased food supply
system efficiencies, such as improvements in supply chain management
and inventory control; more expedient initiation and completion of
recalls; avoidance of costs due to unnecessary preventive actions by
consumers; reduction of food waste; and other food supply system
efficiencies due to a standardized approach to traceability, including
an increase in transparency and trust and potential deterrence of fraud
(Ref. 16 (Refs. 1, 2)).
    This rule will impose compliance costs on covered entities by
increasing the number of records that are required for covered food
products. Entities that manufacture, process, pack, or hold covered
foods will incur costs to establish and maintain a traceability plan
and traceability records. Some firms may also incur initial and
recurring capital investment and training costs for systems that will
enable them to keep, maintain, and make available to other supply chain
entities (and to us upon our request) their traceability records.
Moreover, firms will incur one-time costs of reading and understanding
the rule.\2\
---------------------------------------------------------------------------

    \2\ The information flows brought about by the rule may prompt
new protective actions--for example, in farming, manufacturing, or
cooking processes--that could also have costs. We have not
quantified these potential costs, but they would likely correlate
with the realization of the health and longevity benefits of this
rule.
---------------------------------------------------------------------------

    Table 2 summarizes the costs and benefits of the final rule. At a 7
percent discount rate, 20-year annualized costs range from about $63
million to $2.3 billion, with a primary estimate of $570 million per
year. At a 3 percent discount rate, annualized costs range from about
$53 million to $2.3 billion, with a primary estimate of $551 million
per year. The present value of costs with 7 percent discounting over 20
years (not shown in table 2) ranges from about $0.7 billion to $24.6
billion, with a primary estimate of about $6 billion. The present value
of costs with 3 percent discounting over 20 years (not shown in table
2) ranges from about $0.8 billion to $33.7 billion, with a primary
estimate of $8.2 billion.
    We estimate public health benefits using several case studies of
outbreak tracebacks for four pathogens associated with illnesses caused
by covered foods.\3\ We calculate these benefits based on an estimated
83 percent reduction of traceback time resulting from the requirements
of this rule. At a 7 percent discount rate over 20 years, the
annualized monetized health benefits of the rule range from $59 million
to $2.2 billion with a primary estimate of $780 million (table 2). At a
3 percent discount rate over 20 years, the annualized monetized health
benefits range from $61 million to $2.3 billion with a primary estimate
of $810 million. The present value of health benefits with 7

percent discounting over 20 years (not shown in table 2) ranges from
about $0.6 billion to $23.7 billion, with a primary estimate of $8.3
billion. The present value of health benefits with 3 percent
discounting over 20 years (not shown in table 2) ranges from about $0.9
billion to $34.5 billion, with a primary estimate of $12.0 billion.
---------------------------------------------------------------------------

    \3\ This approach has a tendency toward underestimation of the
total public health benefits because these four pathogens do not
represent the total burden of all FTL-associated illnesses. However,
adjustments made for undiagnosed and unattributed illnesses may have
the opposite tendency of overstating both FTL-associated illnesses
and benefits. We cannot scale up to 100 percent because our
estimates of the percentage of illnesses potentially avoided with
improved traceability depend on data specific to each pathogen. We
describe our methods in detail in FRIA section II.E.1, Public Health
Benefits from Averted Illnesses. In short, these four pathogens may
account for roughly 95 percent of the total dollar value of the
illnesses for which traceability might be an effective preventive
measure.
---------------------------------------------------------------------------

    We estimate (non-health) benefits from avoiding overly broad
recalls and market withdrawals. At a 7 percent discount rate over 20
years, these annualized monetized benefits range from $233 million to
$1.8 billion with a primary estimate of $575 million (table 2). At a 3
percent discount rate over 20 years, these annualized monetized
benefits range from $242 million to $1.8 billion with a primary
estimate of $596 million. The present value of benefits from avoiding
overly broad recalls with 7 percent discounting over 20 years (not
shown in table 2) ranges from about $2.5 billion to $18.8 billion, with
a primary estimate of $6.1 billion. The present value of these benefits
with 3 percent discounting over 20 years (not shown in table 2) ranges
from about $3.6 billion to $27.3 billion, with a primary estimate of
$8.9 billion.

                                Table 2--Summary of Benefits, Costs and Distributional Effects of Final Rule ($Millions)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                Units
                                           Primary       Low        High    -------------------------------------------------
                Category                  estimate    estimate    estimate      Year      Discount                                       Notes
                                                                               dollars      rate          Period covered
--------------------------------------------------------------------------------------------------------------------------------------------------------
Benefits:
    Annualized Monetized Millions$/year        $780         $59      $2,238        2020          7%  20 years...............  Monetized health benefits
                                                810          61        2322        2020          3%  20 years...............   from an estimated 83%
                                                                                improvement in traceback
                                                                                time for four pathogens.
                                                                                Additional (non-health)
                                                                                benefits of avoiding
                                                                                overly broad recalls
                                                                                range from $233 million
                                                                                to $1.8 billion, with a
                                                                                primary estimate of $575
                                                                                million (at 7% discount
                                                                                rate) and from $242
                                                                                million to $1.8 billion,
                                                                                with a primary estimate
                                                                                of $596 million (at 3%
                                                                                discount rate).
    Annualized Quantified
                                        ----------------------------------------------------------------------------------------------------------------
    Qualitative........................  Additional potential benefits
                                         include increased food supply
                                         system efficiencies; more
                                         expedient initiation and
                                         completion of recalls; avoidance
                                         of costs due to unnecessary
                                         preventive actions; reduction of
                                         food waste; and other efficiencies
                                         from a standardized approach to
                                         traceability.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Costs:
    Annualized Monetized Millions$/year         570          63       2,323        2020          7%  20 years...............  A portion of foreign costs
                                                551          53       2,267        2020          3%  20 years...............   could be passed on to
                                                                                domestic consumers. We
                                                                                estimate that up to $50.5
                                                                                million in annualized
                                                                                costs (7%, 20 years) to
                                                                                foreign facilities could
                                                                                be passed on to domestic
                                                                                consumers.
    Annualized Quantified
    Qualitative........................  ..........  ..........  ..........  ..........  ..........  .......................  Costs of farming-,
                                                                                manufacturing- or cooking-
                                                                                related actions that, as
                                                                                a result of new
                                                                                information flows,
                                                                                address risks of
                                                                                foodborne illness.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Transfers:
    Federal Annualized Monetized
     Millions$/year.
                                        ----------------------------------------------------------------------------------------------------------------
    From/To............................  From:
                                         To:
                                        ----------------------------------------------------------------------------------------------------------------
    Other Annualized Monetized
     Millions$/year.
                                        ----------------------------------------------------------------------------------------------------------------
    From/To............................  From:
                                         To:
--------------------------------------------------------------------------------------------------------------------------------------------------------
    Effects:............................................................................................................................................
--------------------------------------------------------------------------------------------------------------------------------------------------------
    State, Local or Tribal Government: No significant effect............................................................................................
    Small Business: Potential impact on small entities that are currently not keeping traceability records described by the rule........................
    Wages: N/A..........................................................................................................................................
    Growth: N/A.........................................................................................................................................
--------------------------------------------------------------------------------------------------------------------------------------------------------

    We have developed a comprehensive economic analysis document that
assesses the impacts of the final rule and includes the Final
Regulatory Impact Analysis, Final Regulatory Flexibility Analysis, and
Unfunded Mandates Reform Act Analysis (Ref. 16). The full analysis of
economic impacts is available in the docket for this final rule and at
https://www.fda.gov/about-fda/reports/economic-impact-analyses-fda-regulations.

VIII. Analysis of Environmental Impacts

    We previously considered the environmental effects of this rule, as
stated in the preamble to the proposed rule (85 FR 59984 at 60025). We
stated that we had determined, under 21 CFR

25.30(h), that this action is of a type that does not individually or
cumulatively have a significant effect on the human environment such
that neither an environmental assessment (EA) nor an environmental
impact statement (EIS) is required. We received comments on our
tentative determination that this rule is categorically excluded from
the requirement to prepare an EA or an EIS; we respond to these
comments in the Categorical Exclusion Memorandum for this rulemaking
(Ref. 24). We conclude that we have not received any new information or
comments that would affect our previous determination.

IX. Paperwork Reduction Act of 1995

    This final rule contains information collection provisions that are
subject to review by the Office of Management and Budget (OMB) under
the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521). A
description of these provisions is given in the Description section
with an estimate of the reporting and recordkeeping burden associated
with the final rule. Included in the estimate is the time for reviewing
instructions, searching existing data sources, gathering and
maintaining the data needed, and completing and reviewing each
collection of information.
    Title: Establishment, Maintenance, and Availability of Records;
Traceability Records for Certain Foods--OMB Control No. 0910-0560--
Revision.
    Description: The new regulations will establish recordkeeping
requirements applicable to certain foods, to help effectively and
rapidly identify recipients of a food to prevent or mitigate a
foodborne illness outbreak. These recordkeeping requirements are
intended to strengthen public health protections by documenting the
movement of foods throughout the supply chain, enabling FDA to identify
the source of contaminated foods and aid in the removal of contaminated
products from the market. The regulations also help implement statutory
provisions governing high-risk foods. Access to and utilization of
traceability records better enables FDA to respond to and contain
threats to the public health introduced through foods on the Food
Traceability List (FTL) (``listed foods'').
    Description of Respondents: Respondents to the information
collection are persons who manufacture, process, pack, or hold foods
that appear on the list of foods for which additional traceability
records are required in accordance with section 204(d)(2) of the FDA
Food Safety Modernization Act (FSMA) (i.e., the FTL).
    In the following paragraphs, we describe and respond to the
comments pertaining to the proposed information collection.
    (Comment 567) Some comments suggest that the estimate of entities
that will be affected is too narrow because it includes only those
entities that manufacture, process, pack, or hold listed foods or foods
containing a listed food as an ingredient. The comments maintain that,
in practice, the new requirements will likely affect entities handling
all foods because covered entities will be required to revise their
recordkeeping systems to comply with the rule, and it would be more
time- and energy-intensive to maintain two sets of recordkeeping
systems (one for listed foods and one for non-listed foods). The
comments assert that covered entities will expand their recordkeeping
systems to all foods they handle, which in turn will require that their
suppliers comply with the rule for the foods they provide to covered
entities, whether FTL foods or not (making those suppliers also likely
to adopt the rule's requirements for all foods). One comment asserts
that the estimates should consider nearly every entity along the food
supply chain except the consumer.
    (Response 567) We regard recordkeeping by firms that do not handle
covered foods, but that might choose to adopt traceability practices
consistent with their business partners who do, as usual and customary
and therefore assume no burden for this activity. When certain
practices prove optimal on business grounds, or when large firms--
including those not subject to the rule--exert influence over supplier
practices via market power, practices might converge over time for
reasons other than regulatory compliance. Moreover, as documented in
the 2012 IFT traceability pilot project (Ref. 1), firms with widely
varying traceability practices already conduct business with each other
while serving the traceability demands of downstream customers and
industry initiatives without resulting convergence among the entities
with regard to those traceability practices. Because the rule does not
prescribe specific technologies for records maintenance and KDEs
required under subpart S mostly consist of information already commonly
communicated between business partners, we expect supply chains to
continue to accommodate widely varying traceability practices.
    Concerning firms that handle both covered and non-covered foods, we
do not believe implementation of KDE recordkeeping for non-covered
foods would affect our estimates. First, our assumptions regarding new
equipment, software, services, training, and procedures--which we
acknowledge might necessarily displace existing systems rather than
operate in parallel with them--considers these to be fixed costs with
respect to the number of foods handled. Second, we estimate the
variable costs of recordkeeping as labor, and we do not believe in
general that requiring an employee to perform an action for certain
foods creates a need to perform that action for all other foods. We
would thus not attribute to the rule the additional labor cost of
performing traceability recordkeeping on all other foods.
    As noted in the FRIA, after consideration of the comments, we
examined more recent data sources on covered entities and modified our
estimate of the entities that will be affected by the rule. We have
adjusted the total number of respondents downward by approximately
100,000, consistent with the updated data sources and our decision to
exempt additional entities from the rule. While we expect that it will
be possible for businesses to keep the requisite records just for FTL
foods, we will continue to evaluate this aspect of the information
collection in future updates.
    (Comment 568) Some comments state that the estimated time and cost
to read and understand the rule is too low. One comment asserts that
the estimate of 3.3 hours for each respondent to read and understand
the new recordkeeping requirements is an immense understatement. The
comment stated that the proposed rule was 55 three-column pages in the
Federal Register and includes multiple cross-references to FSMA and
existing FDA regulations, and there were three full-day public meetings
and multiple supplemental materials to help stakeholders understand the
rule, including a revision to the FTL and an FAQ document. Other
comments assert that the estimate of 3.3 hours is perhaps the amount of
time it would take to simply read the proposed rule, but it fails to
account for the need to consider the rule's implications and how it
would affect a particular entity. Some comments maintain that more than
1 person per covered entity will need to read and understand the rule,
that as many as 10 or more people might read the rule, and that the
time needed to understand the rule is far more than 3.3 hours. One
comment asserts that the estimate should be increased to a minimum of
10 hours, which would roughly triple employee costs. The comment bases
this assertion in part on their estimate that reading and

understanding the ``supplemental examples'' we posted in February 2021
took 4 to 6 hours.
    (Response 568) Our basis for the estimated time to read and
understand the rule remains consistent with methods used in previous
FDA analyses and assumes an existing understanding of applicable
regulations already effective under FSMA. However, we did increase the
amount of time we attribute to reading and understanding the
recordkeeping requirements from 3.3 hours to, on average, 16.8 hours,
as both the final codified text and particularly the preamble to the
final rule are longer than the proposed rule text. This estimate is an
average over all firms, and now includes an assumption that in small
firms one employee will read the rule and in large firms three
employees will read the rule. The estimated average sum of the time
spent reading and understanding the rule at each firm is 16.8 hours.
    With regard to the number of respondents, we account for multiple
employees reading the rule at larger companies. While many small firms
might not in fact read the full text of the preamble of the final rule
and associated provisions of the Code of Federal Regulations (instead
learning about the rule from simplified explanations via trade
associations and publications), we assume that one employee will read
the rule at small firms and that three employees will read the rule at
large firms. Note also that we consider reading costs alone in Section
II.F.2 (``Reading and Understanding the Rule'') of the FRIA to be
separate from the costs to identify FTL products and plan for
compliance, which we estimate in Section II.F.5.b (``Traceability
Plan'') of the FRIA.
    (Comment 569) Some comments maintain that the estimated one-time
set-up costs are far too low. Some comments assert that while the
proposed rule estimates that most entities (other than distribution
centers and warehouses) will be required to maintain records for 1,000
FTL lots, the comments anticipate they will handle far more than 1,000
lots. One comment estimates that for its products containing nut
butters alone (i.e., not accounting for other ingredients potentially
on the FTL), the firm handles more than 9,000 FTL lots per year. One
comment asserts that because many if not most entities process numerous
lots of hundreds of different SKUs each year, these entities will be
required to establish and maintain records for far more than 1,000 FTL
lots. The comment also asserts that even FDA's higher estimate for
warehouses (48,333 lots annually) is still far too low. One comment
maintains that entities other than distribution centers and warehouses
will handle many thousands of food traceability lots (not just 1,000)
on an annual basis, depending on their size, while distribution centers
and warehouses likely will handle millions of such lots (not just
190,000).
    (Response 569) To gain a better understanding of industry's
possible adoption of new practices and systems in response to the rule
and to better inform our estimates of the number of traceability lots
handled by various covered entities by entity size and category, we
contracted with consultants (the Eastern Research Group (ERG)) to
elicit input from an external panel of industry experts (Ref. 34). We
have incorporated their input in Section II.F.5 (``Traceability Plan'')
of the FRIA, in which we estimate the costs of planning new procedures
to comply with the final rule. In particular, our estimates now
differentiate between small and large establishments. In most industry
categories, our primary estimates of FTL lots undergoing initial
packing, first land-based receiving, shipping, and transforming are now
800 to 900 lots for small establishments and 1,400 to 5,500 lots for
large establishments. For lots received by warehouses, distribution
centers, restaurants, and non-restaurant retailers, our primary
estimates are now 1,500 to 4,600 lots for small establishments and
3,100 to 28,600 lots for large establishments.
    (Comment 570) Some comments state that the time and cost estimates
for training for the rule are far too low. One comment asserts that
although FDA projects that only a portion of firms will incur training
costs and that such firms will need to conduct an average of 2 hours of
training regarding an average of 3 records, because of the rule's
complexity and the fundamental changes to current recordkeeping
practices that would be required under the proposed rule, firms will
need to conduct ongoing, company-wide trainings to ensure compliance.
One comment asserts that under third-party auditing programs that
members are currently involved in, they have a minimum of 8 to 10 hours
of training per employee (which does not include annual retraining,
verification, and any travel costs associated with training). Based on
these assertions, the comments maintain that we should significantly
increase the estimate of the training time and costs. One comment
asserts that training estimates did not account for the significant
volume of employees who will require training and the time needed to
train them. The comment maintains that time required to train employees
will vary depending on their role, and that larger retailers will have
several hundred associates to train, while tens of thousands of
employees will require training when they are onboarded. The comment
estimates that training costs range from $15,000 to nearly $3 million.
One comment asserts that firms will have annual training costs, not
just a one-time cost. The comment further maintains that annually
training employees on the requirements will take 5 hours of each
employee's time, and that an annual review, commonly required by
auditors, would need to be conducted, all adding to costs.
    (Response 570) In the PRIA, we assumed that training would be a
one-time cost to train only a limited number of current employees on
the new requirements and traceability practices. We also assumed that,
for training new employees, some outdated training content will be
replaced with training related to this rule, thus not incurring an
additional training cost for those new employees. We note that comments
did not provide additional data in support of alternative estimates.
However, after reviewing the comments on our estimates of training
costs, we determined a need for and sought additional data and
information to improve our estimates. We contracted with consultants to
survey a panel of external industry experts to further inform training
costs to various covered entities based on their size and baseline
industry practices (Ref. 34). In Section II.F.4 of the FRIA, we
estimate the number of trainees for entities of different sizes across
different industry sectors based on input by the expert panel. We now
differentiate between small and large establishments across different
industry categories. In general, hours stayed roughly the same or
slightly increased (compared to the proposed estimates) for small
establishments and increased for large establishments. The number of
trainees increased significantly for both, so the per-establishment
cost has gone up. However, we now estimate that far fewer
establishments need training specifically for this rule because most
establishments subject to the rule only receive FTL foods, which we
have assumed to be a simple task on its own, so the total hours have
gone down. As a result, we have revised the estimated one-time burden
associated with training personnel as shown in table 3. In addition, we
have added to the

estimated annual recordkeeping burden an estimate of recurring, or
annual, training costs, as shown in table 5.
    (Comment 571) Some comments maintain that the time and cost
estimates for annual recordkeeping are far too low. One comment asserts
that they will need to hire people to create and maintain a database
system for electronic recordkeeping, even if it can be an Excel
spreadsheet that is made available to FDA upon request, because it is
not clear what is needed for the spreadsheet. One comment asserts the
proposed growing area coordinates requirement for growers will cause a
paperwork hardship. One comment maintains that scanning a barcode vs.
scanning and typing even three pieces of information such as brand,
pack date, and lot code will take more than the estimated 0.004 hour.
The comment further maintains that as a company receiving loads that
have one-case quantities of some products and straight truckloads of
other products, having to type in the identifying factors for hundreds
of products each week will quickly become more costly than the
software. One comment asserts that the ``high'' numbers noted in table
31 in the PRIA for recurring recordkeeping costs were too low. The
comment maintains that assuming 0.01 hours for each record (the high
number in the table was 0.006 hours) is a truer estimate, simply
adjusting the time needed to establish and maintain records and the
time needed to send records would increase the costs by 67 percent. The
comment further asserts that 5 minutes to type each transaction is a
more reasonable estimate than the proposed rule's ``high'' estimate of
3 minutes, and states that this change would increase costs by 67
percent.
    (Response 571) We have updated our estimates of the number of
covered entities and costs to reflect additional full exemptions for
small entities and certain food, as well as the exemption of smaller
entities from the requirement to provide an electronic, sortable
spreadsheet in certain circumstances upon the Agency's request.
Additionally, the final rule aims to simplify recordkeeping by aligning
requisite elements more closely with data elements already captured and
communicated in standard business practices. Therefore, we have updated
our estimates of burden per traceability lot, accounting both for
changes to the proposed rule and expert elicitation (Ref. 34).
Additionally, section II.F.5 the FRIA distinguishes ``capturing'' from
``submitting'' information and accounts for them as distinct
activities.
    Regarding the proposed growing area coordinates requirement for
growers of FTL foods, we note this is no longer a requirement of the
rule. Instead, persons that grow or raise an FTL food (other than eggs)
that are subject to the rule will need to keep, as part of their
traceability plan, a farm map showing the area in which the FTL food
was grown or raised. We have received farm maps with field names and
coordinates during outbreak investigations, and because of the
widespread availability and use of no-cost mapping and direction
websites and web applications with GPS coordinate-plotting
functionality, we expect most affected entities either already keep the
required map or will be able to produce it in minutes.
    Regarding the comments specific to the estimates for scanning and
typing information and the high estimates for annual recordkeeping,
because our cost estimates include significant capital investment by
manufacturers and wholesalers, our estimated average recordkeeping
times therefore assume that many of these entities will significantly
reduce manual data entry in recordkeeping. Since retailers need only
keep the records provided to them by suppliers and do not generally
need to use the information for further compliance activities, we do
not expect retailers in general to perform data entry, manual or
otherwise.
    (Comment 572) One comment maintains that when a raw product is
transformed, it may become multiple products, therefore multiplying the
number of required records. One comment maintains that counting a
shipment as one traceability lot is inaccurate, asserting instead that
most shipments contain multiple lots because of breakdowns into
different sizes (e.g., 4-, 6-, 8-ounce sizes). The comment maintains
that these multiple lots would necessitate multiple data entries for
the same shipment, thus increasing costs.
    (Response 572) Based on expert elicitation (Ref. 34) in response to
FDA outreach regarding this rulemaking, we have revised our estimate of
the attendant recordkeeping burden upward to better reflect the scope
of coverage. These revisions are discussed in detail in Section
II.F.5.h of the FRIA.
    (Comment 573) A number of comments maintain that FDA has
underestimated the time and cost attendant to proposed revisions to the
FTL under proposed Sec.  1.1465(a); however, the comments did not
include an alternative basis upon which we could form a burden
estimate.
    (Response 573) It is challenging to estimate the burden associated
with possible future revisions to the FTL, such as learning about the
changes or submitting comments, because we do not know whether those
revisions would reduce or increase the number of foods on the FTL or
what the public response to the revisions would be. We remind
respondents that we invite public comment at regular intervals on our
information collection activities, including burden associated with
recordkeeping requirements already required under part 1, subpart J. As
we implement the subpart S requirements, we will continue to monitor
and invite feedback regarding burden associated with revisions to the
FTL.
Burden Tables
    Upon consideration of these comments, we estimate the burden of the
information collection as follows:

                                Table 3--Estimated One-Time Recordkeeping Burden
----------------------------------------------------------------------------------------------------------------
                                                                                Average
                                     Number of       Number of     Total annual     burden per
            Activity               recordkeepers    records per       records      recordkeeping    Total hours
                                                   recordkeeper                     (in hours)
----------------------------------------------------------------------------------------------------------------
Reading and understanding the            323,872               1         323,872        \1\ 16.8       5,441,050
 new recordkeeping requirements.
Sec.   1.1315; traceability plan         212,368               1         212,368             6.2       1,316,682
 (one-time set-up)..............
Training personnel..............          34,737            10.5         364,739             4.2       1,531,904
                                 -------------------------------------------------------------------------------
    Total.......................  ..............  ..............  ..............  ..............       8,289,635
----------------------------------------------------------------------------------------------------------------
\1\ There is likely to be more than one reader at each large firm. The estimated average sum over all readers of
  the time spent reading and understanding the rule at each firm is 16.8 hours.

    The Estimated One-Time Recordkeeping Burden table reflects several
changes to the proposed information collection. The estimated number of
respondents for reading and understanding the recordkeeping
requirements decreased because of additional exemptions and revisions
to exemptions added in the final rule and our use of more recent data
sources on the number of covered entities. We also increased the
average burden to read and understand the rule from 3.3 hours to 16.8
hours because the length of the rule increased. The number of
respondents for the one-time set up costs for the traceability plan
(``traceability program records'' under the proposed rule) was updated
based on updated overall coverage estimates for the number of firms,
plus new data on the share of entities that will establish a
traceability plan from the ERG expert elicitation study (Ref. 34). This
is now a per-firm rather than per-establishment (facility) burden, and
because we have moved from traceability program records to a
traceability plan, the number of records per respondent has decreased
to one. Finally, we have updated the number of respondents for training
personnel based on updated coverage estimates plus newer data from the
ERG expert elicitation study. Now training is per-establishment
(facility) rather than per-firm. We have also updated the number of
records per respondent for training personnel based on the ERG expert
elicitation study.

                                   Table 4--Estimated Annual Reporting Burden
----------------------------------------------------------------------------------------------------------------
                                                                                Average
                                     Number of       Number of     Total annual     burden per
       Reporting activity           respondents    responses per     responses     response (in     Total hours
                                                    respondent                        hours)
----------------------------------------------------------------------------------------------------------------
1.1370; Requests for modified                  5               1               5              10              50
 requirements and exemptions....
1.1415 through 1.1425; Requests               15               1              15              10             150
 for waivers....................
1.1465(a); Comments on proposed                1               1               1               1               1
 revisions to the Food
 Traceability List..............
                                 -------------------------------------------------------------------------------
    Total.......................  ..............  ..............              22  ..............             201
----------------------------------------------------------------------------------------------------------------

    As discussed above, we have made no changes to the estimated annual
reporting burden associated with the final rule.

                                 Table 5--Estimated Annual Recordkeeping Burden
----------------------------------------------------------------------------------------------------------------
                                                   Number of                     Average burden
     21 CFR recordkeeping          Number of      records per    Total annual          per          Total hours
                                 recordkeepers   recordkeeper       records       recordkeeping
----------------------------------------------------------------------------------------------------------------
Training personnel (recurring)          26,053            10.5         273,557  2.7.............         738,604
Sec.   1.1330(b); seed lot                  95             882          83,790  0.04 (2.4                  3,352
 records (sprout growers).                                                       minutes).
Sec.   1.1325; harvester......           6,058             578       3,501,524  0.03 (1.8                105,046
                                                                                minutes).
Sec.   1.1325; cooler.........           3,511             572       2,008,292  0.03 (1.8                 60,249
                                                                                minutes).
Sec.   1.1330(a) and (c);                4,218             861       3,631,698  0.02 (1.2                 72,634
 initial packer.                                                                 minutes).
Sec.   1.1335; first land-                 367           1,471         539,857  0.02 (1.1                 10,797
 based receiver.                                                                 minutes).
Sec.   1.1340; shipper........          31,434           5,032     158,175,888  0.006 (22                949,055
                                                                                seconds).
Sec.   1.1345; receiver.......         470,580           5,968   2,808,421,440  0.003 (11              8,425,264
                                                                                seconds).
Sec.   1.1350; transformer....           8,574           1,101       9,439,974  0.02 (1.2                188,799
                                                                                minutes).
Sec.   1.1455(c)(3)(ii);                    75               1              75  16.0............           1,200
 electronic sortable
 spreadsheet upon request.
                               ---------------------------------------------------------------------------------
    Total.....................  ..............  ..............  ..............  ................      10,555,000
----------------------------------------------------------------------------------------------------------------

    The revised estimated annual recordkeeping burden in table 5
reflects several changes we made to the proposed information
collection. First, the list of provisions changed consistent with
revisions we made to the CTEs and related annual activities such as
training personnel. The number of recordkeepers generally decreased
because of additional exemptions and revisions to exemptions we added
in the final rule and our use of more recent data sources on the number
of covered entities. We have also estimated the burden for training
personnel as a recurring burden rather than a one-time burden and
altered the number of records per recordkeeper for the various
provisions based on information from the ERG expert elicitation study
(Ref. 34). Finally, we have updated the average burden per
recordkeeping based on information from the ERG expert elicitation
study. Apart from changes to the proposed rule, we also newly estimated
the annual burden of formatting traceability information as an
electronic sortable spreadsheet upon request by FDA.
    Because we have deleted the requirements (in proposed Sec.
1.1350(b)(2)) that farms disclose information (if applicable) about the
origination, harvesting, cooling, and packing of food shipped by the
farm, we have removed the disclosure burden previously included. Under
Sec.  1.1325(a)(2) and (b)(2) of the final rule, harvesters and coolers
of FTL foods must disclose certain information about those activities
to the initial packers of such food. However, as we stated in the
preamble to the proposed rule with respect to the disclosure burden for
shippers of FTL foods (85 FR 59984 at 60027), we are including the
estimate of burden we attribute to the disclosure requirements for
harvesters and coolers

as part of our recordkeeping burden estimate for these provisions
because we believe this disclosure burden will be minimal, since these
respondents must maintain harvesting and cooling information in
accordance with those provisions.
    The information collection provisions in this final rule have been
submitted to OMB for review as required by section 3507(d) of the
Paperwork Reduction Act of 1995. Before the effective date of this
final rule, FDA will publish a notice in the Federal Register
announcing OMB's decision to approve, modify, or disapprove the
information collection provisions in this final rule. An Agency may not
conduct or sponsor, and a person is not required to respond to, a
collection of information unless it displays a currently valid OMB
control number.

X. Federalism

    We have analyzed this final rule in accordance with the principles
set forth in Executive Order 13132. FDA has determined that the rule
does not contain policies that have substantial direct effects on the
States, on the relationship between the National Government and the
States, or on the distribution of power and responsibilities among the
various levels of government. Accordingly, we conclude that the rule
does not contain policies that have federalism implications as defined
in the Executive order and, consequently, a federalism summary impact
statement is not required.

XI. Consultation and Coordination With Indian Tribal Governments

    We have analyzed this rule in accordance with the principles set
forth in Executive Order 13175. We have determined that the rule does
not contain policies that have substantial direct effects on one or
more Indian Tribes, on the relationship between the Federal Government
and Indian Tribes, or on the distribution of power and responsibilities
between the Federal Government and Indian Tribes. Accordingly, we
conclude that the rule does not contain policies that have tribal
implications as defined in the Executive Order and, consequently, a
tribal summary impact statement is not required.

XII. References

    The following references marked with an asterisk (*) are on display
at the Dockets Management Staff (see ADDRESSES) and are available for
viewing by interested persons between 9 a.m. and 4 p.m., Monday through
Friday; they also are available electronically at https://www.regulations.gov. References without asterisks are not on public
display at https://www.regulations.gov because they have copyright
restriction. Some may be available at the website address, if listed.
References without asterisks are available for viewing only at the
Dockets Management Staff. FDA has verified the website addresses, as of
the date this document publishes in the Federal Register, but websites
are subject to change over time.

1. * Institute of Food Technologists, ``Pilot Projects for Improving
Product Tracing Along the Food Supply System--Final Report,'' August
2012.
2. FDA, ``Report to Congress on Enhancing Tracking and Tracing of
Food and Recordkeeping. Submitted Pursuant to Section 204 of the FDA
Food Safety Modernization Act, Public Law 111-353,'' November 16,
2016 (https://www.fda.gov/media/102784/download).
3. * FDA, ``Food Traceability List for Requirements for Additional
Traceability Records for Certain Foods Proposed Rule 2020,'' August
12, 2020 (https://www.fda.gov/media/142283/download).
4. * FDA Memorandum, ``Methodological Approach to Developing a Risk-
Ranking Model for Food Tracing FSMA Section 204 (21 U.S.C. 2223),''
August 2020 (https://www.fda.gov/food/food-safety-modernization-act-fsma/fsma-reports-studies).
5. * FDA Memorandum, ``Designation of the Food Traceability List
Using the Risk-Ranking Model for Food Tracing (2019 Version),''
September 2, 2020 (https://www.fda.gov/media/142282/download).
6. * Dewey-Mattia, D., et al. ``Surveillance for Foodborne Disease
Outbreaks--United States, 2009-2015.'' Morbidity and Mortality
Weekly Report. Surveillance Summaries (Washington, DC: 2002), vol.
67,10 1-11. 27 July 2018, doi:10.15585/mmwr.ss6710a1.
7. Irvin, K., S. Viazis, A. Fields, et al., ``An Overview of
Traceback Investigations and Three Case Studies of Recent Outbreaks
of Escherichia coli O157:H7 Infections Linked to Romaine Lettuce,''
Journal of Food Protection, 84:1340-1356, 2021.
8. * FDA Memorandum, ``Food Traceability List for Requirements for
Additional Traceability Records for Certain Foods Proposed Rule--
Clarified Language,'' January 12, 2021 (https://www.fda.gov/media/145050/download).
9. * FDA, ``FDA's Response to External Peer Review--Model Review on
FDA's `Draft Report for Peer Review: Risk-Ranking Model for Product
Tracing as Required by Section 204 of FSMA' (September 2015),''
August 2020 (https://www.fda.gov/science-research/peer-review-scientific-information-and-assessments/completed-peer-reviews and