[Federal Register Volume 79, Number 188 (Monday, September 29, 2014)]
[Proposed Rules]
[Pages 58573-58599]
[FR Doc No: 2014-22448]

Vol. 79

Monday,

No. 188

September 29, 2014

Part V

 Department of Health and Human Services

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 Food and Drug Administration

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21 CFR Part 1

 Foreign Supplier Verification Programs for Importers of Food for
Humans and Animals; Proposed Rule

Federal Register / Vol. 79 , No. 188 / Monday, September 29, 2014 /
Proposed Rules

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Part 1

[Docket No. FDA-2011-N-0143]
RIN 0910-AG64

Foreign Supplier Verification Programs for Importers of Food for
Humans and Animals

AGENCY: Food and Drug Administration, HHS.

ACTION: Proposed rule; supplemental notice of proposed rulemaking.

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SUMMARY: The Food and Drug Administration (FDA) is revising certain
provisions of the proposed rule, issued in July 2013, on foreign
supplier verification programs (FSVPs) for importers of food for humans
and animals. We are primarily revising the proposed requirements
concerning compliance status review of food and foreign suppliers,
hazard analysis, and supplier verification activities. We are taking
this action in response to the extensive public input we have received
regarding these provisions and in coordination with revisions we are
concurrently making to the proposed rule on current good manufacturing
practice (CGMP) and hazard analysis and risk-based preventive controls
for human food. We are seeking public comment on the revised proposed
FSVP regulations. We are reopening the comment period on the proposed
rule only with respect to the specific provisions identified in this
Federal Register document.

DATES: Submit either electronic or written comments on the supplemental
notice of proposed rulemaking by December 15, 2014. Submit comments on
information collection issues under the Paperwork Reduction Act of 1995
by December 15, 2014 (see the ``Paperwork Reduction Act of 1995''
section of this document).

ADDRESSES: You may submit comments by any of the following methods,
except that comments on information collection issues under the
Paperwork Reduction Act of 1995 must be submitted to the Office of
Regulatory Affairs, Office of Management and Budget (OMB) (see the
``Paperwork Reduction Act of 1995'' section of this document).

Electronic Submissions

    Submit electronic comments in the following way:
     Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.

Written Submissions

    Submit written submissions in the following ways:
     Mail/Hand delivery/Courier (for paper submissions):
Division of Dockets Management (HFA-305), Food and Drug Administration,
5630 Fishers Lane, Rm. 1061, Rockville, MD 20852.
    Instructions: All submissions received must include the Docket No.
(FDA-2011-N-0143) for this rulemaking. All comments received may be
posted without change to http://www.regulations.gov, including any
personal information provided. For additional information on submitting
comments, see the ``Comments'' heading of the SUPPLEMENTARY INFORMATION
section of this document.
    Docket: For access to the docket to read background documents or
comments received, go to http://www.regulations.gov and insert the
docket number(s), found in brackets in the heading of this document,
into the ``Search'' box and follow the prompts and/or go to the
Division of Dockets Management, 5630 Fishers Lane, Rm. 1061, Rockville,
MD 20852.

FOR FURTHER INFORMATION CONTACT: Brian Pendleton, Office of Policy,
Food and Drug Administration, 10903 New Hampshire Ave., Silver Spring,
MD 20993-0002,<PHONE_NUMBER>; or Domenic Veneziano, Office of
Enforcement and Import Operations (ELEM-3108), Office of Regulatory
Affairs, Food and Drug Administration, 12420 Parklawn Dr., Element
Bldg., Rockville, MD 20857,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Table of Contents

Executive Summary
    Purpose of the Supplemental Notice of Proposed Rulemaking
    Summary of the Revisions to the Proposed Rule
    Costs and Benefits
I. Background
    A. Proposed Rule on FSVPs
    B. Public Comments
    C. Alignment of FSVP Regulations With Potential Supplier
Verification Provisions in the Proposed Preventive Controls
Regulations
    D. Decision To Issue Supplemental Notice of Proposed Rulemaking
Regarding Certain Preventive Controls Requirements
    E. Scope of FSVP Supplemental Notice of Proposed Rulemaking
II. Revisions to the Proposed Rule
    A. Compliance Status Review
    B. Hazard Analysis
    C. Supplier Verification
    D. Definitions of Very Small Importers and Very Small Foreign
Suppliers
    E. Other Related Revisions
III. Preliminary Regulatory Impact Analysis
IV. Paperwork Reduction Act of 1995
V. Analysis of Environmental Impact
VI. Comments
VII. References

Executive Summary

Purpose of the Supplemental Notice of Proposed Rulemaking

    We are revising certain provisions of the proposed rule, issued in
July 2013, on FSVPs for importers of food for humans and animals. The
revisions primarily concern the proposed rule's requirements on
compliance status review of food and foreign suppliers, hazard
analysis, and supplier verification activities. We are issuing these
revisions in response to extensive public input we have received
regarding these provisions and in alignment with certain revisions we
are concurrently making to the proposed rule on preventive controls for
human food.

Summary of the Revisions to the Proposed Rule

    One revision to the proposed rule would, consistent with many
comments we received, delete the previously proposed section on
compliance status review but incorporate some of the provisions into
the requirements concerning hazard analysis and evaluation of certain
risk factors in determining appropriate foreign supplier verification
and related activities.
    Another revision would modify some of the previously proposed
hazard analysis requirements. In accordance with several comments we
received, as well as the revised hazard analysis provisions and new
supplier program provisions in the revised preventive controls proposal
that we are concurrently issuing, the revised FSVP proposal changes the
requirement to analyze hazards that are reasonably likely to occur to a
requirement to analyze known or reasonably foreseeable hazards to
determine if they are significant. Under the revised proposal, a
significant hazard would be defined as a known or reasonably
foreseeable hazard in a food for which a person knowledgeable about the
safe manufacturing, processing, packing, or holding of food would,
based on the outcome of a hazard analysis, establish controls to
significantly minimize or prevent and components to manage those
controls (such as monitoring, corrections and corrective actions,
verification, and records), as appropriate to the food, the facility,
and the control.

    Other changes related to the proposed hazard analysis requirements
that are consistent with the proposed hazard analysis requirements in
the preventive controls proposal include requiring analysis of hazards
that may be intentionally introduced for purposes of economic gain,
requiring evaluation of environmental pathogens in certain ready-to-eat
food, and minor changes to other hazard evaluation factors.
    Another revision to the previous proposed rule would specify that,
along with the hazard analysis, the importer must consider other
factors primarily related to supplier risks in determining appropriate
supplier verification and related activities before importing a food
from a particular foreign supplier and thereafter when the importer
becomes aware of new information about these risks. These proposed
changes respond to numerous comments stating that industry best
practice is to base supplier verification activities on an assessment
of information about the risks presented by a food as well as by the
supplier of the food, rather than focusing primarily on hazards
inherent in food. Under the revised proposal, in addition to the hazard
analysis, the importer would be required to consider the following in
approving suppliers and determining appropriate verification
activities:
     The entity that will be applying hazard controls, such as
the foreign supplier or the foreign supplier's raw material or
ingredient supplier.
     The foreign supplier's procedures, processes, and
practices related to the safety of the food.
     Applicable FDA food safety regulations and information
regarding the foreign supplier's compliance with those regulations,
including whether the foreign supplier is the subject of an FDA warning
letter or import alert.
     The foreign supplier's food safety performance history,
including results from testing foods for hazards, audit results
relating to the safety of the food, and the supplier's record of
correcting problems.
     Any other factors as appropriate and necessary, such as
storage and transportation practices.
    We also are revising certain proposed requirements regarding
supplier verification measures themselves and related activities.
Instead of maintaining a list of their foreign suppliers, importers
would be required to establish and follow procedures to ensure that
they import foods only from foreign suppliers that they have approved
(except, when necessary and appropriate, from unapproved suppliers on a
temporary basis). Consistent with the revised proposal's focus on a
broader evaluation of risks, we are proposing that, rather than being
designed to ensure that identified hazards are adequately controlled,
the purpose of importers' supplier verification activities should be to
provide adequate assurances that the foreign supplier produces the food
in a manner consistent with FDA's regulations on preventive controls or
produce safety, if either is applicable to the foreign supplier, and to
assure that the food is not adulterated and not misbranded regarding
allergen labeling. This approach is consistent with the purpose for
foreign supplier verification specified in section 805(a)(1) of the
Federal Food, Drug, and Cosmetic Act (the FD&C Act) (21 U.S.C. 384a).
    After considering comments on the alternative proposals we
presented in the 2013 proposed rule regarding supplier verification
activities, we are proposing an approach that gives importers the
flexibility to determine appropriate verification measures based on
food and supplier risks, while acknowledging the greater risk to public
health posed by the most serious hazards in foods. Under the revised
proposal, based on the risk evaluation the importer conducts, the
importer would be required to determine and document what supplier
verification activities are appropriate for a particular food and
foreign supplier, as well as the frequency with which those activities
should be conducted. Appropriate supplier verification activities could
include onsite auditing of the foreign supplier, sampling and testing
of food, review of the supplier's food safety records, or some other
procedure determined to be appropriate based on the identified risks.
    However, the revised proposal also specifies that, when there is a
hazard in a food that could result in serious adverse health
consequences or death to humans or animals (a ``SAHCODHA'' hazard), an
importer would need to conduct or obtain documentation of an onsite
audit of the foreign supplier before initially importing the food and
at least annually thereafter, unless the importer specifically
determined that some other supplier verification activity and/or less
frequent auditing would adequately address the identified risks. This
requirement would establish a clear verification standard for these
most serious food hazards yet permit importers to employ a different
approach if they can confirm that the alternative approach will provide
adequate assurance that the identified risks are addressed.
    We tentatively conclude that this revised proposal regarding
supplier verification activities strikes an appropriate balance between
granting importers the flexibility to adopt risk-based verification
measures while increasing the likelihood that importers will apply the
most rigorous verification measures to the most serious risks.
    The revised proposal also would specify that if a foreign supplier
is a farm that is not subject to the produce safety regulations, the
importer of food from the supplier would not be subject to the
``standard'' verification requirements previously noted but would
instead be required to obtain written assurance biennially that the
supplier is producing the food in compliance with the FD&C Act. This
proposed change reflects the different treatment of food from such
farms under the produce safety regulations and would be consistent with
the potential requirement for a supplier program in the preventive
controls regulations.
    In addition, we are proposing to add provisions stating that when
importers or their customers are in compliance with the requirements on
supplier programs in the proposed preventive controls regulations, the
importers would be deemed in compliance with most of the FSVP
requirements (in cases involving customer compliance with the supplier
program requirements, the importer would need to obtain written
assurance of compliance annually from the customer). This proposed
change is consistent with our intent, stated in the FSVP and preventive
controls proposed rules, to avoid imposing redundant regulatory
requirements on food importers who also are food facilities subject to
the preventive controls regulations.
    Finally, we are increasing, from $500,000 to $1 million, the annual
sales ceiling used in the proposed definition of ``very small
importer'' and ``very small foreign supplier'' to be consistent with
our revised approach to the proposed definition of ``very small
business'' under the proposed preventive controls regulations.

Costs and Benefits

    We summarize the annualized costs (over a 10-year time period
discounted at both 3 percent and 7 percent) of the revised proposed
rule in the following table.

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                                          3 percent         7 percent
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Annualized Cost.....................      $396,780,114      $397,478,400
Reduction in Cost Relative to               76,191,228        75,901,638
 Original Option 1..................
Reduction in Cost Relative to               64,627,341        64,343,306
 Original Option 2..................
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    The reduction in FSVP requirements for importers who also would be
subject to the preventive controls regulations, and other proposed
changes in the requirements, results in a cost savings of $76 million
per year (compared to Option 1 of the 2013 proposed rule). The overall
potential net benefit from the revised proposed rule is estimated at
$714 million per year. These figures are based on a 3 percent discount
rate, a scenario for inflation, over 10 years. (The figures are the
same for a 7 percent discount rate.)
    Although the FSVP proposed rule would not itself establish safety
requirements for food manufacturing and processing, it would benefit
the public health by helping to ensure that imported food is produced
in a manner consistent with other applicable food safety regulations.
The Preliminary Regulatory Impact Analyses for the proposed rules on
preventive controls for human food and standards for produce safety
consider and analyze the number of illnesses and deaths that the
proposed regulations are aimed at reducing. The greater the compliance
with those regulations, the greater the expected reduction in illnesses
and deaths as well as the costs associated with them. The FSVP
regulations would be an important mechanism for improving and ensuring
compliance with the previously noted food safety regulations as they
apply to imported food. For this reason, we account for the public
health benefits of the FSVP proposed rule in the preventive controls,
produce safety, and other applicable food safety regulations instead of
in this rule.

I. Background

A. Proposed Rule on FSVPs

    On July 29, 2013, FDA published in the Federal Register a proposed
rule entitled ``Foreign Supplier Verification Programs for Importers of
Food for Humans and Animals'' (``the 2013 FSVP proposed rule'' or ``the
previous proposed rule'') (78 FR 45730) to require importers to perform
certain activities to help ensure that the food they bring into the
United States is produced in a manner consistent with U.S. standards.
    FDA proposed the FSVP regulations as part of our implementation of
the FDA Food Safety Modernization Act (FSMA) (Pub. L. 111-353). Section
301 of FSMA adds section 805 to the FD&C Act to require persons who
import food into the United States to perform risk-based foreign
supplier verification activities for the purpose of verifying the
following: (1) The food is produced in compliance with section 418
(concerning hazard analysis and risk-based preventive controls) or 419
(concerning standards for the safe production and harvesting of certain
fruits and vegetables that are raw agricultural commodities (RACs)) of
the FD&C Act (21 U.S.C. 350g and 350h), as appropriate; (2) the food is
not adulterated under section 402 of the FD&C Act (21 U.S.C. 342); and
(3) the food is not misbranded under section 403(w) of the FD&C Act (21
U.S.C. 343(w)) (concerning food allergen labeling). Section 805(c) of
the FD&C Act directs FDA to issues regulations on the content of
importers' FSVPs.
    The FSVP proposed rule would require food importers to adopt
programs to ensure that the food they import meets the previously noted
statutory standards. The previous proposed rule would have required
importers to take the following actions as part of their FSVPs:
     Use a qualified individual to perform most FSVP
activities.
     Review the compliance status of foods and foreign
suppliers.
     Analyze the hazards reasonably likely to occur with foods.
     Determine and perform appropriate foreign supplier
verification activities for foods. As discussed in more detail in
section II.C.5, the proposal set forth two optional approaches to
verification requirements that differ primarily with respect to the
verification activities that importers must conduct when a SAHCODHA
hazard is present in a food.
     Review complaints, conduct investigations of adulterated
or misbranded food, take corrective actions when appropriate, and
modify the FSVP when it is determined to be inadequate.
     Reassess the effectiveness of the FSVP.
     Ensure that information identifying the importer is
submitted upon entry of a food into the United States.
     Maintain records of FSVP procedures and activities.
    In addition to these ``standard'' FSVP requirements that would
apply to most food importers, the previous proposed rule included
modified requirements for the following:
     Importers of dietary supplements and dietary supplement
components.
     Very small importers and importers of food from very small
foreign suppliers.
     Importers of food from foreign suppliers in countries
whose food safety systems FDA has officially recognized as comparable
or determined to be equivalent to the U.S. food safety system.

B. Public Comments

    We requested comments on the FSVP proposed rule by November 26,
2013. We extended the comment period for the proposed rule and its
information collection provisions (which are subject to review by OMB
under the Paperwork Reduction Act of 1995 (the PRA) (44 U.S.C. 3501-
3520)) (78 FR 69602, November 20, 2013). The comment period for the
proposed rule closed on January 27, 2014.
    After we published the FSVP proposed rule in July 2013, we held two
public meetings to solicit stakeholder and public comments on the
proposed rule, inform the public about the rulemaking process, and
respond to questions about the proposed rule (see 78 FR 57320,
September 18, 2013). We also made other presentations, participated in
Webinars, and met with stakeholders in the United States and abroad to
discuss the FSVP proposed rule along with proposed rules implementing
other FSMA provisions.
    Over 350 comments were submitted to the docket on the FSVP proposed
rule. We continue to review these comments as part of our development
of the final rule on FSVPs. However, for the reasons discussed in
sections I.C through I.E, we are issuing revisions to certain
provisions in the previous proposed rule and requesting comment on the
revisions.

C. Alignment of FSVP Regulations With Potential Supplier Verification
Provisions in the Proposed Preventive Controls Regulations

    In the FSVP proposed rule, we stated that we recognized the
importance of coordinating the FSVP regulations with any supplier
verification provisions that might be included in the regulations on
preventive controls for human and animal food (78 FR 45730 at 45740 to

45741, 45747 to 45748). We had first expressed that intent in the
proposed rule on ``Current Good Manufacturing Practice and Hazard
Analysis and Risk-Based Preventive Controls for Human Food'' (the
``Preventive Controls proposed rule'') (78 FR 3646, January 16, 2013).
Although the Preventive Controls proposed rule did not include specific
regulations on supplier verification, the Agency requested comment on
when and how approval and verification of suppliers of raw materials
and ingredients are an appropriate part of preventive controls, and
sought comment on different aspects of supplier approval and
verification programs (78 FR 3646 at 3665 to 3667). We also stated that
we intended to align any supplier verification provisions in the
preventive controls regulations with the FSVP regulations to avoid
imposing duplicative requirements on entities that are subject to each
of those sets of regulations because they are both registered food
facilities and food importers. We expressed a similar intent regarding
alignment with any supplier verification provisions that might be
included in the proposed regulations on preventive controls for animal
food (see ``Current Good Manufacturing Practice and Hazard Analysis and
Risk-Based Preventive Controls for Food for Animals,'' 78 FR 64736 at
64808, October 29, 2013).
    In the FSVP proposed rule, we requested comment on how to address
foreign supplier verification by importers who could be subject to both
the FSVP and preventive controls regulations to avoid imposing
duplicative requirements on such firms. In particular, we requested
comment on whether the FSVP regulations should state that if an
importer was required to establish a supplier approval and verification
program under the preventive controls regulations for a food, and was
in compliance with those regulations, the importer would be deemed to
be in compliance with the FSVP regulations that address those matters
(78 FR 45730 at 45748).

D. Decision To Issue Supplemental Notice of Proposed Rulemaking
Regarding Certain Preventive Controls Requirements

    In December 2013, we issued a statement (Ref. 1) noting the
extensive input we had received from produce farmers and others in the
agricultural sector on the Preventive Controls proposed rule and FDA's
2013 proposed rule on ``Standards for the Growing, Harvesting, Packing,
and Holding of Produce for Human Consumption'' (``the Produce Safety
proposed rule'') (78 FR 3504, January 16, 2013). We expressed our
belief that significant changes would be needed in key provisions of
the two proposed rules affecting small and large farmers, such as
certain provisions affecting mixed-use facilities (i.e., facilities co-
located on a farm). We also announced our intent to propose revised
regulatory requirements and request comment on them, allowing the
public the opportunity to provide input on our new thinking. We noted
that there might be other revisions to these proposed rules that we
would issue for public comment, and that we would determine the scope
of the revised proposals as we completed our initial review of the
submitted comments on the proposed rules.

E. Scope of FSVP Supplemental Notice of Proposed Rulemaking

    In accordance with our December 2013 statement, elsewhere in this
issue of the Federal Register we are issuing a supplemental notice of
proposed rulemaking regarding the preventive controls for human food
proposed rule (``Preventive Controls supplemental document'') and a
supplemental notice of proposed rulemaking regarding the rule on
preventive controls for animal food. In addition to revisions to
previously proposed requirements, the Preventive Controls supplemental
document includes proposed provisions on supplier programs for food
facilities that receive raw materials and ingredients. To align the
FSVP proposed regulations with the provisions on supplier programs in
the revised Preventive Controls proposed rule, and in response to
comments that we have received concerning certain related issues in the
FSVP proposal, we are revising the FSVP proposed rule. As discussed in
detail in section II, the principal changes to the FSVP proposal
include the following:
     Deleting the previously proposed section requiring
importers to conduct a compliance status review of the food and foreign
supplier but incorporating some parts of this section into the
previously proposed requirement to conduct a hazard analysis of the
food and a newly proposed requirement to evaluate other risks
associated with the food and foreign supplier.
     Replacing the previously proposed requirement to analyze
hazards that are ``reasonably likely to occur'' with a proposed
requirement to analyze ``known or reasonably foreseeable'' hazards to
determine if they are significant (i.e., necessitate control measures).
     Giving importers the flexibility to conduct the supplier
verification activities that they have determined, based on their
evaluation of food and foreign supplier risks, can provide adequate
assurance that the supplier is producing the food in a manner
consistent with U.S. food safety requirements. For foods that are
associated with a SAHCODHA hazard, the revised proposal specifically
requires initial and subsequent annual onsite auditing of the foreign
supplier unless the importer determines, based on its risk evaluation
of the food and foreign supplier, that other verification activities
are appropriate and adequate.
    We discuss these revised proposed requirements in section II. We
are reopening the comment period on the proposed rule only with respect
to these matters. In the FSVP final rule, we will take into account
public comments already received and any comments received in response
to this document in finalizing the FSVP requirements.
    The previous proposed rule and the revisions and new provisions in
this supplemental notice of proposed rulemaking, taken together,
constitute the entirety of the proposed rule on FSVPs. Throughout this
document, we discuss revisions to the previously proposed subpart L of
21 CFR part 1 and, in the codified section of this supplemental notice
of proposed rulemaking, we list each of the revised and new provisions
of proposed subpart L. For the convenience of readers and ease of
reference, we prepared a separate document (to be included in the
public docket for this rulemaking) that identifies the changes to the
previous codified provisions and provides the complete proposed subpart
L of 21 CFR part 1, as revised through this document (Ref. 2).

II. Revisions to the Proposed Rule

    As stated in section I.E, in response to comments we have received
and as part of our effort to align the FSVP requirements with the
supplier program provisions in the revised Preventive Controls proposed
rule, we are making several revisions to the FSVP proposed rule. These
changes focus primarily on importers' evaluation of the risks
associated with the foods they import and the foreign suppliers of this
food, along with the supplier verification activities that importers
must conduct.
    Although we have tried to align the supplier verification
provisions in the FSVP and preventive controls regulations as much as
possible, there are some differences between the two. These differences
are largely due to statutory language and the fact that

while supplier verification is the principal focus of the FSVP
regulations, it would only be a component of the preventive controls
regulations if it is included in the final preventive controls
regulations. These factors result in the two sets of proposed
regulations being structured somewhat differently. We request comment,
in light of the statutory provisions, on the manner and extent to which
the FSVP and preventive controls supplier verification provisions--as
well as other aspects of the FSVP and preventive controls regulations--
should be aligned in the final rules.

A. Compliance Status Review

    The previous FSVP proposed rule included two requirements
concerning importers' review of information related to the risk
associated with foods and/or foreign suppliers. These are:
     A requirement to review the compliance status of each food
to be imported and each foreign supplier being considered (previously
proposed Sec.  1.504); and
     A requirement to analyze the hazards in each food
(previously proposed Sec.  1.505).
    Regarding compliance status review, proposed Sec.  1.504 would have
required an importer, before importing a food from a foreign supplier,
to assess the compliance status of the food and the foreign supplier,
including whether either is the subject of an FDA warning letter,
import alert, or requirement for certification issued under section
801(q) of the FD&C Act (21 U.S.C. 381(q)) relating to the safety of the
food, to determine whether it would be appropriate to import the food
from the foreign supplier. Proposed Sec.  1.504 also would have
required an importer to document this review and to continue to monitor
and document the compliance status as long as the importer obtains the
food from the foreign supplier.
1. Comments
    We received many comments about the proposed compliance status
review provisions. A frequent comment by food importers on the
compliance status review requirements is that the proposal places too
much emphasis on compliance status review, in particular on warning
letters and import alerts, as a basis for determining appropriate
supplier verification activities. Several comments maintain that
compliance status review should be regarded as just one part of an
analysis of the risks associated with a food and the foreign supplier
of the food. However, several comments state that supplier verification
activities should be based not solely on an analysis of the hazards in
a food but also on the potential risks associated with a foreign
supplier of the food.
    Some comments state that an importer should consider both positive
and negative compliance information about a foreign supplier. One
comment states that each importer should determine on its own what
information is relevant to review about a supplier's risk, which might
include assessing a supplier's compliance status.
    Some comments express concern that certain information about a
firm's compliance status, such as FDA Form 483 inspection reports and
consent decrees, could be too difficult to obtain because they might be
available only through a request under the Freedom of Information Act.
In addition, some comments maintain that the FDA Web site is
insufficiently organized and would have to be updated to track food and
foreign supplier compliance status. Some comments state that an
importer should be free to determine on its own what information about
the risk of a foreign supplier is relevant to consider.
    Many comments express concern that the proposal did not specify how
frequently an importer must conduct a compliance status review. Several
comments recommend that importers be required to conduct these reviews
annually. Some comments object to a continuous monitoring requirement
as unnecessary and suggest instead that an importer be required to
reassess its supplier's compliance status as part of the importer's
reassessment of its FSVP when the importer becomes aware of new
information about potential hazards associated with the food or
supplier.
2. Revisions Regarding Food and Foreign Supplier Risk Evaluation
    Contrary to how some of the commenters read the proposed
requirements, the previous proposal would not have required importers
to consider only whether there was a relevant warning letter, import
alert, or certification requirement under section 801(q) of the FD&C
Act; rather, the importer would have needed to consider information
relevant to the compliance status of the food and the foreign supplier,
e.g., warning letters and import alerts. The preamble to the 2013
proposed rule discussed other types of information about a food or
foreign supplier's compliance status, such as Form FDA 483s,
Establishment Inspection Reports, and recall notices.
    We agree, however, that importers should consider both food and
supplier risks in developing their supplier verification plans.
Therefore, we tentatively conclude that it is appropriate to more
clearly specify that importers must consider certain information
relevant to the risks associated with a food and the foreign supplier.
Rather than have a separate section requiring importers to conduct a
compliance status review of foods and potential foreign suppliers, we
are incorporating these compliance concerns into the proposed risk
evaluation requirements.
    We now are proposing to establish provisions requiring importers to
evaluate the risks associated with the food and the potential foreign
supplier to determine whether it is appropriate to approve the
importation of the food from the foreign supplier. In addition to
requiring importers to consider the hazards they determine to be
significant under proposed Sec.  1.504 in the revised regulatory text
(discussed in section II.B), proposed Sec.  1.505(a)(1) in the revised
regulatory text would require importers to consider the following:
     The entity that will be applying controls for the
identified hazards, such as the foreign supplier or the foreign
supplier's raw material or ingredient supplier. As stated in the
preamble to the 2013 proposed rule, we believe that the person who will
be controlling a hazard in a food is an important, though not
necessarily the only, factor in determining an appropriate supplier
verification activity for the food.
     The foreign supplier's procedures, processes, and
practices related to the safety of the food. Many comments state that
various aspects associated with the manner in which a foreign supplier
produces a food can affect the risk associated with the supplier.
     Applicable FDA food safety regulations and information
regarding the foreign supplier's compliance with those regulations,
including whether the supplier is the subject of an FDA warning letter
or import alert. There is widespread acknowledgement among the comments
that a foreign supplier's history of compliance with applicable FDA
regulations is an important component (though not the only component)
of supplier risk evaluation. Documents such as warning letters and
import alerts are available on FDA's Web site; we tentatively conclude
that we would not require importers to consider non-public information
regarding compliance with FDA regulations unless such information was
available to the importer (e.g., provided to the importer by the
foreign supplier).
     The foreign supplier's food safety performance history,
including results from testing foods for hazards, audit

results relating to the safety of the food, and the supplier's record
of correcting problems. Several comments state that an importer
typically considers a foreign supplier's performance in providing
products that meet the importer's specifications, as verified through
onsite auditing, testing, or other measures, in determining the form
and frequency of verification activities to conduct.
     Any other factors as appropriate and necessary, such as
storage and transportation practices. We believe that there might be
factors not previously specified that in certain circumstances an
importer should consider in evaluating food and supplier risks, such as
storage and transportation practices or recent changes to the
management of a foreign supplier.
    Proposed Sec.  1.505(a)(2) in the revised proposed regulatory text
would require the importer to document each risk evaluation it
conducts.
    We tentatively conclude that this approach to risk evaluation
requirements provides a more complete and specific listing (compared to
the combined requirements in the previous proposal regarding compliance
status review and hazard analysis) of the factors noted by many
comments as being the issues that importers typically consider in
evaluating food and foreign supplier risks. Under the revised proposal,
importers would need to consider each of the previously listed factors
in performing their food and foreign supplier risk evaluations. We
intend to issue guidance on the specific information that we believe
should be considered under each of these factors and how these factors
might be weighed in evaluating overall risk.
    These proposed risk evaluation factors closely align with the
factors that receiving facilities must consider in determining
appropriate raw material and ingredient supplier verification
activities under the supplier program provisions of the revised
Preventive Controls proposed rule.
    We believe that it is not necessary to mandate a specific frequency
(e.g., on an annual basis) for a complete reanalysis of the risks
associated with a food or foreign supplier. Instead, we believe that an
importer should reevaluate food and supplier risks when it obtains new
information about these risks, either through the importer's own
investigation or from the foreign supplier, FDA, or some other source.
Therefore, proposed Sec.  1.504(b) in the revised regulatory text would
require an importer to promptly evaluate the risks associated with a
food or foreign supplier when the importer becomes aware of new
information about the risks. We intend to provide guidance on the
circumstances under which importers should reevaluate food and supplier
risks.

B. Hazard Analysis

    The other requirement in the previous proposed rule that concerned
evaluation of food and supplier risk was the requirement to conduct a
hazard analysis. Previously proposed Sec.  1.505(a) would require each
importer (with certain exceptions) to determine, for each food
imported, the hazards, if any, that are reasonably likely to occur with
the food and, for each, the severity of the illness or injury if such a
hazard were to occur. The importer would need to document this
determination and use it to determine appropriate supplier verification
activities.
    Previously proposed Sec.  1.505(b) states that an importer's
evaluation of the hazards that are reasonably likely to occur with each
food that is imported must consider the following potential hazards
that may occur naturally or may be unintentionally introduced:
Biological hazards, including microbiological hazards such as parasites
and environmental pathogens, and other microorganisms of public health
significance; chemical hazards, including substances such as pesticide
and drug residues, natural toxins, decomposition, unapproved food or
color additives, and food allergens; physical hazards; and radiological
hazards.
    Previously proposed Sec.  1.505(c) states that, in evaluating the
hazards in Sec.  1.505(b), the importer must consider the effect of
several factors on the safety of the finished food for the intended
consumer. These factors are as follows: The ingredients of the food;
the condition, function, and design of the foreign supplier's
establishment and equipment; transportation practices; harvesting,
raising, manufacturing, processing, and packing procedures; packaging
and labeling activities; storage and distribution; intended or
reasonably foreseeable use; sanitation, including employee hygiene; and
any other relevant factors.
    Previously proposed Sec.  1.505(d) would permit an importer to
identify the hazards that are reasonably likely to occur for a
particular food by reviewing and evaluating the hazard analysis
conducted by the foreign supplier (rather than conducting an entirely
separate evaluation of hazards using information that the importer
itself has obtained).
    Finally, under previously proposed Sec.  1.505(e), for a RAC that
is a fruit or vegetable, an importer would not be required to conduct a
hazard analysis regarding the microbiological hazards that might be
reasonably likely to occur with this food. Instead, the importer would
need to verify that this kind of food is produced in compliance with
FDA's produce safety standards, once finalized, or equivalent
standards.
    As stated in section II.A.2, our revised proposal would continue to
require an importer to analyze the hazards in a food that it imports,
with the hazard analysis being one part of the food and foreign
supplier risk evaluation that the importer must conduct under Sec.
1.505 in the revised regulatory text. In this section, we discuss
certain revisions we are making to the hazard analysis requirements in
the proposed rule.
1. Nature of the Hazards That Importers Must Analyze
a. Comments
    Several comments object to the proposed requirement that importers'
hazard analyses focus on hazards that are ``reasonably likely to
occur'' with a food. We proposed to define a hazard reasonably likely
to occur as one for which a prudent importer would establish controls
or verify that the supplier controls because experience, illness data,
scientific reports, or other information provides a basis to conclude
that there is a reasonable possibility that the hazard will occur in
the type of food being imported in the absence of those controls. One
comment states that the ``reasonably likely to occur'' standard should
not be used because it goes beyond and is inconsistent with the ``known
or reasonably foreseeable'' statutory standard in FSMA's preventive
controls provisions (section 418(b)(1) of the FD&C Act). Several
comments maintain that the term reasonably likely to occur typically
has been used to determine critical control points for hazard analysis
and critical control points (HACCP) systems and is inappropriate for
use in a program like supplier verification that is a ``prerequisite,''
foundational food safety program. The comments recommend instead that
importers be required to consider ``known or reasonably foreseeable''
hazards because determining such hazards requires knowledge of the
facility in which the food is produced.
b. Revisions Regarding Nature of Hazards To Be Evaluated
    The hazard analysis provisions in both the FSVP and preventive
controls previously proposed rules would have required evaluation of
hazards that are reasonably likely to occur. As we state

in the Preventive Controls supplemental document, we acknowledge that
it might be confusing to use the phrase ``reasonably likely to occur''
in both our HACCP regulations and in the preventive controls and FSVP
regulations, because the phrase ``reasonably likely to occur'' has been
used as the basis for determining hazards that need to be addressed in
a HACCP plan at critical control points. In light of this concern, and
consistent with our revision of the hazard analysis provisions in the
preventive controls proposed rule, we tentatively conclude that the
potential hazards that importers should be required to consider in
their risk analyses are hazards that are known or reasonably
foreseeable rather than hazards that are reasonably likely to occur. We
believe that it is appropriate to align the hazard analysis provisions
in the FSVP regulations with those in the proposed preventive controls
regulations because hazard analysis is an import component of supplier
verification.
    We now propose to define a ``known or reasonably foreseeable
hazard'' as a potential biological, chemical (including radiological),
or physical hazard that is known to, or has the potential to be,
associated with a food or the facility in which it is manufactured/
processed (Sec.  1.500 in the revised regulatory text). (We accordingly
propose to add a definition of ``facility,'' which would be defined as
a domestic facility or a foreign facility that is required to register
under section 415 of the FD&C Act (21 U.S.C. 350d), in accordance with
the requirements of 21 CFR part 1, subpart H.) We also are revising the
hazard analysis provisions to make clear that they apply to analysis of
known or reasonably foreseeable hazards.
    Section 1.504(a) in the revised regulatory text would require an
importer to analyze the known or reasonably foreseeable hazards in a
food, based on experience, illness data, scientific reports, and other
information, to determine whether they are ``significant'' hazards. We
propose to define a ``significant hazard'' as a known or reasonably
foreseeable hazard for which a person knowledgeable about the safe
manufacturing, processing, packing, or holding of food would, based on
the outcome of a hazard analysis, establish controls to significantly
minimize or prevent the hazard in a food and components to manage those
controls (such as monitoring, corrections and corrective actions,
verification, and records), as appropriate to the food, the facility,
and the control (Sec.  1.500 in the revised regulatory text). This
means that importers must conduct hazard analyses to determine whether
any known or reasonably foreseeable hazard in a food poses such a risk
to health that it is necessary to establish controls to significantly
minimize or prevent the hazard. This definition of significant hazard
and the proposed requirement to determine whether known or reasonably
foreseeable hazards are significant are consistent with the approach
that we are proposing in the supplier program provisions of the
preventive controls regulations.
2. Biological Hazards
    As previously stated, previously proposed Sec.  1.505(b)(1) would
require importers to consider whether there are biological hazards in
the food they import, including microbiological hazards such as
parasites and environmental pathogens, and other microorganisms of
public health significance. In the Preventive Controls supplemental
document, we are replacing the phrase ``microorganism of public health
significance'' in the proposed preventive controls hazard analysis
provisions with the phrase ``pathogen'' and proposing to define
``pathogen'' as a microorganism of public health significance. To
better align the FSVP requirements with those proposed for preventive
controls, we are proposing to describe biological hazards in the same
way in Sec.  1.504(b)(1)(i) in the revised regulatory text and adding a
definition of ``pathogen'' to proposed Sec.  1.500. In addition, we are
including the same revised definition of ``environmental pathogen'' as
is set forth in the Preventive Controls supplemental document, which
proposes to define ``environmental pathogen'' as a pathogen that is
capable of surviving and persisting within the manufacturing,
processing, packing, or holding environment such that food may be
contaminated and may result in foodborne illness if that food is
consumed without treatment to significantly minimize or prevent the
environmental pathogen (the definition also specifies that spores of
pathogenic sporeformers are not environmental pathogens).
3. Radiological Hazards
    As previously stated, the proposed rule included radiological
hazards among the types of hazards (along with biological, chemical,
and physical hazards) that importers must consider in their hazard
analyses.
a. Comments
    Some comments maintain that radiological hazards should be included
among the chemical hazards rather than in a separate category. One
comment states that treating radiological hazards as a separate
category would mean that FSMA regulations would differ from Codex and
world-wide HACCP standards, which require evaluation only of
biological, chemical, and physical hazards, and would create a
potential for misunderstanding and lack of acceptance by foreign
suppliers. The comment states that making radiological hazards a subset
of chemical hazards would help mitigate concerns about a requirement to
consider radiological hazards.
b. Revisions Regarding Radiological Hazards
    We tentatively conclude that it is appropriate to consider
radiological hazards as a type of chemical hazard. Therefore, we have
revised the definition of ``hazard'' and the reference to radiological
hazards in the revised hazard analysis provisions (Sec. Sec.  1.500 and
1.504(b)(1)(ii), respectively, in the revised regulatory text).
However, this does not mean that consideration of radiological hazards
would be optional; rather, importers would be required to review such
hazards when considering possible chemical hazards in a food.
4. Intentional Hazards
    In the previous FSVP proposed rule, we stated our tentative
conclusion that importers need only consider those hazards that occur
naturally or might be unintentionally introduced (78 FR 45730 at
45749). We noted that we planned to address the issue of certain
intentionally introduced hazards as part of our rulemaking to implement
section 106 of FSMA, which directs FDA to issue regulations to protect
against the intentional adulteration of food. But we acknowledged that
some kinds of intentional adulterants could be viewed as reasonably
likely to occur, such as in foods for which there is a known risk of
economically motivated adulteration. Therefore, we requested comment on
whether to include in the FSVP requirements potential hazards that may
be intentionally introduced for economic reasons.
a. Comments
    Comments were submitted both for and against requiring importers to
consider hazards intentionally introduced for economic reasons. One
comment states that although importers should consider economically
motivated adulterants, most such adulterants should not be regarded as
reasonably likely to occur and do not pose a food safety hazard. Some

comments question the feasibility of determining which economically
motivated adulterants should be viewed as reasonably likely to occur.
Some comments state that economically motivated adulteration is best
addressed through food defense plans. One comment states that importers
should not be required to consider intentional hazards, including
economically-motivated hazards, because such hazards require different
kinds of preventive measures than those traditionally used in supplier
verification programs.
b. Revisions Regarding Intentional Hazards
    We are proposing to add hazards that may be intentionally
introduced for purposes of economic gain to the types of known or
reasonably foreseeable hazards that an importer would be required to
consider in its hazard analysis (see Sec.  1.504(b)(2)(iii) in the
revised regulatory text). As discussed in the Preventive Controls
supplemental document, several substances, such as melamine and dyes
containing lead, have been used in economically motivated adulteration
schemes and have potential to harm public health. Because some
economically motivated adulterants should be regarded as known or
reasonably foreseeable hazards, we believe it is appropriate that
importers consider them when conducting hazard analyses. We are no
longer proposing that importers analyze hazards that are reasonably
likely to occur, so the concerns related to applying that standard to
economically motivated adulterants are no longer relevant. In addition,
because the proposed regulations define a ``hazard'' as an agent that
is reasonably likely to cause illness or injury in the absence of its
control, importers need only consider those economically motivated
adulterants that are reasonably likely to harm consumers' health, not
economically motivated adulterants that solely affect quality or value.
    We disagree with the comment that economically motivated
adulteration requires different kinds of preventive measures than those
traditionally used in supplier verification programs. Industry
currently uses audits, sampling, and testing to verify that hazards are
being controlled, including hazards from economic adulteration.
Nevertheless, as discussed in section II.C.5, the revised proposed
supplier verification requirements provide considerable flexibility to
importers in conducting supplier verification, including the ability to
determine and implement any appropriate supplier verification activity
based on the risks associated with the food and foreign supplier.
5. Environmental Pathogens in Certain Ready-To-Eat Food
    To better align the hazard analysis requirements in the FSVP
regulations with those in the proposed preventive controls regulations,
we are adding a proposed requirement, in Sec.  1.504(c)(2) in the
revised regulatory text, for importers to include in their hazard
analysis of a food an evaluation of environmental pathogens whenever a
ready-to-eat food is exposed to the environment before packaging and
the packaged food does not receive a treatment that would significantly
minimize the pathogen.
6. Factors Affecting the Safety of Finished Food
    Also to better align the FSVP hazard analysis requirements with
those in the proposed preventive controls regulations, we are making
two minor revisions to the list of proposed items that importers must
consider regarding their potential effect on the safety of finished
food for the intended consumer. In Sec.  1.504(c)(3)(i) in the revised
regulatory text, we are replacing ``ingredients of the food'' with
``formulation of the food,'' and in Sec.  1.504(c)(3)(iii) in the
revised regulatory text we are adding a requirement to consider ``raw
materials and ingredients.''

C. Supplier Verification

    We are revising several aspects of the proposed requirements
concerning foreign supplier verification procedures and related
activities. The revisions include a revised proposal regarding the
alternative options presented in the proposed rule concerning
appropriate supplier verification activities when foreign suppliers
control (or verify control of) hazards in food.
1. List of Foreign Suppliers
    To help ensure that importers are obtaining food only from
appropriate foreign suppliers, previously proposed Sec.  1.506(a) would
require each importer to maintain a written list of the foreign
suppliers from which they are importing food. The list would also help
importers to quickly and accurately identify their foreign suppliers
for purposes of conducting FSVP activities such as supplier
verification, investigations, and corrective actions, and help ensure
consistent performance of these activities by importers' employees or
other qualified individuals.
a. Comments
    Several comments express support for the proposed requirement that
importers maintain a list of their foreign suppliers. However, some
comments oppose this requirement on the basis that it would present
logistical or administrative challenges. Some comments state that it
would be burdensome to constantly update the list of foreign suppliers.
Some comments suggest that importers instead be required to provide a
list of suppliers upon the Agency's request. One comment states that
the identity of suppliers is confidential business information that
importers should not be required to disclose to FDA on a routine basis.
    Some comments state that some importers might not maintain a single
list of approved suppliers but use a corporate-wide or centralized
system to confirm receipt of food from approved suppliers. These
comments instead recommend that importers be required to establish a
system that will allow them to confirm that imported food is from a
foreign supplier that the importer has approved for use.
    One comment states that in emergency situations to avoid production
disruptions, an importer might need to obtain food from foreign
suppliers that they have not audited. The comment maintains that use of
food from such suppliers would be acceptable provided that the food is
inspected or analyzed before use.
b. Revisions Regarding Process for Confirming Receipt of Food From
Approved Suppliers.
    We are uncertain how an importer could verify that a food it
receives is from an approved foreign supplier yet be unable to generate
a list of such approved suppliers, especially when the importer uses a
centralized, corporate-wide system. We understand that use of multiple
supplier databases could necessitate some compilation procedure, but it
does not appear to us that this would be significantly burdensome.
Nevertheless, we tentatively conclude that requiring importers to
establish a system or procedure to confirm that imported foods are from
approved suppliers, rather than maintain a list of foreign suppliers,
would enhance the safety of imported food at least as much as merely
maintaining a list of suppliers while reducing the apparent
administrative burden on importers. Therefore, we have replaced the
proposed requirement to maintain a list of foreign suppliers with a
proposed requirement, in Sec.  1.506(a) in the revised

regulatory text, to establish and follow written procedures to ensure
that foods are imported from foreign suppliers the importer has
approved based on the risk evaluation it conducts under Sec.  1.505 and
to document use of these procedures. These procedures might address
approval of suppliers, approval or rejection of particular shipments of
foods, and documentation of receipt from approved suppliers. It is
essential that such procedures be capable of accurately identifying
foreign suppliers for purposes of meeting FSVP requirements.
    However, we believe that, in limited circumstances, it might be
appropriate for an importer to use a supplier for which the importer
has not completed a full risk evaluation provided that the importer
takes other steps to ensure that food from such a supplier is safe. For
example, because of a problem with a long-time supplier due to an
equipment breakdown, an environmental or weather-related crisis (e.g.,
severe drought or flooding), or some other unexpected circumstance, it
might be necessary for an importer to obtain a food on a temporary
basis from a new supplier. Because the importer would be unable to
immediately fully evaluate the potential supplier, the importer would
need to take other steps to verify that the food obtained from that
supplier was safe. Such verification measures might include sampling
and testing individual shipments from the supplier. Therefore, revised
Sec.  1.506(a) would permit the use of unapproved foreign suppliers on
a temporary basis when necessary and appropriate, provided that the
importer subjects the food from such suppliers to adequate verification
activities before using or distributing the food. The importer's
written procedures regarding the use of approved suppliers also would
need to address the circumstances under which unapproved suppliers
might be used, and the importer would need to document the verification
activities it conducts when using unapproved suppliers. We request
comment on circumstances under which it might be necessary and
appropriate to receive food from unapproved foreign suppliers and on
the types of verification activities that an importer should conduct on
food from an unapproved supplier.
2. Purpose of Supplier Verification
    Section 1.506(c) of the 2013 proposed rule would have required the
importer to conduct foreign supplier verification activities to provide
adequate assurances that the hazards the importer had identified as
reasonably likely to occur were adequately controlled. However, we
tentatively concluded that this provision should not apply to
microbiological hazards in RACs that are fruits or vegetables and that
would be subject to the produce safety regulations in proposed part 112
(21 CFR part 112) because importers of these fruits or vegetables would
not be required to conduct a hazard analysis regarding the
microbiological hazards in this food. Instead, proposed Sec.  1.506(h)
stated that verification for these hazards should address whether
foreign suppliers are producing these fruits and vegetables in
accordance with the produce safety regulations.
a. Comments
    One comment maintains that directing that supplier verification
activities be designed to provide assurances that hazards are
adequately controlled is inconsistent with the statute and does not
focus on the key issues affecting the safety of imported food. The
comment states that supplier verification activities should consider
not just the hazards in food but supplier-related risks. Some comments
maintain that linking supplier verification activities solely to food
hazards incorrectly implies that verification controls the hazard and
suggests that the supplier can pose no significant safety risks.
b. Revisions Regarding Purpose of Supplier Verification
    We do not believe, nor does the preamble to the 2013 proposed rule
state, that supplier verification activities actually control hazards.
Rather, a key purpose of verification is to provide assurance that
hazards are being effectively controlled by the foreign supplier or
some other entity. However, as stated in section II.A.2, we tentatively
conclude that importers should consider both food and supplier risks in
determining what supplier verification activities to conduct. In
accordance with this approach, we believe that the purpose of supplier
verification activities should not be limited to verifying control of
hazards. Therefore, we now propose to require (in Sec.  1.506(c) in the
revised regulatory text) that supplier verification activities provide
adequate assurances that the foreign supplier is producing the food in
compliance with processes and procedures that provide at least the same
level of public health protection as those required under section 418
or 419 of the FD&C Act (the preventive controls and produce safety
provisions, respectively), if either is applicable, and is producing
the food in compliance with sections 402 and 403(w) of the FD&C Act.
This more directly links supplier verification activities to the
statutory purpose for FSVPs in section 805(a)(1) of the FD&C Act.
    With this change to the proposed purpose of supplier verification
activities, we tentatively conclude that there is no need for a
separate requirement concerning supplier verification activities
related to microbiological hazards in RACs that are fruits or
vegetables subject to the produce safety regulations. With respect to
microbiological hazards in such food, under revised Sec.  1.506(c), the
importer of the food would need to conduct activities to verify that:
(1) The foreign supplier is using processes and procedures that provide
at least the same level of protection as those required under the
produce safety regulations, when finalized and (2) the food is not
adulterated or misbranded regarding allergen labeling.
3. No Hazards Identified
    Under Sec.  1.506(d) of the previous proposed rule, if an importer
determines that no hazards are reasonably likely to occur with a food,
the importer would not be required to conduct supplier verification
activities. However, under the supplier program provisions in the
revised preventive controls proposal, when there are no significant
hazards in a raw material or ingredient, the receiving facility would
not be required to have a supplier program for the food, including the
requirement to determine appropriate verification activities by
considering food and supplier risks. To better align the proposed FSVP
regulations with the proposed preventive controls regulations, we
propose to specify, in Sec.  1.504(f) in the revised regulatory text,
that if an importer evaluates the known and reasonably foreseeable
hazards in a food and determines that there are no significant hazards,
the importer would not be required to determine what foreign supplier
verification and related activities it should conduct and would not be
required to conduct any such activities. (As under the proposed rule,
revised Sec.  1.504(f) states that this exemption would not apply if
the food is a RAC that is a fruit or vegetable and that is subject to
the produce safety regulations.)
4. Hazards Controlled by the Importer or Its Customer
    The preamble to the 2013 proposed rule noted that some hazards
associated with an imported food are controlled through actions that
the importer or its customer takes after the food is brought into the
United States. We tentatively

concluded that if an importer or its customer has established validated
preventive controls to ensure that a hazard is adequately controlled
through processing in the United States, there would be no need for the
importer to conduct a foreign supplier verification activity with
respect to that hazard (78 FR 45730 at 45752). Therefore, when an
importer is adequately controlling a hazard that it has identified,
proposed Sec.  1.506(e) would have required the importer to document,
at least annually, that it had established and was following procedures
that adequately controlled the hazard. Similarly, when an importer's
customer was controlling a hazard, proposed Sec.  1.506(f) would have
required the importer to document that its customer controlled the
hazard by obtaining written assurance, at least annually, from the
customer that it had established and was following procedures
(identified in the written assurance) that adequately controlled the
hazard.
    However, we also requested comment on whether it would be
appropriate to deem importers who are in compliance with any applicable
supplier verification provisions that are included in the preventive
controls regulations to be in compliance with the FSVP requirements, to
avoid duplicative regulation of importers who are also registered with
FDA as food facilities. We tentatively concluded that, if a provision
to this effect were included in the FSVP regulations, proposed Sec.
1.506(e) would be unnecessary, as importers that control hazards in
foods they import would be subject to the supplier verification
provisions in the preventive controls regulations (78 FR 45730 at
45752). Similarly, we tentatively concluded that proposed Sec.
1.506(f) would be unnecessary if the FSVP regulations were to include a
provision stating that an importer whose customer was in compliance
with any adopted preventive controls supplier verification provisions
was deemed to be in compliance with the FSVP requirements. We requested
comment on this proposed approach to supplier verification when the
importer or its customer controls a hazard.
a. Comments
    Several comments agree with proposed Sec.  1.506(e) requiring
importers who control hazards in food they import to document their
control of these hazards. In addition, several comments express support
for avoiding imposing redundant verification requirements on importers
that would be required to conduct supplier verification under the
preventive controls regulations. One comment agrees that proposed Sec.
1.506(e) would be unnecessary if importers who were in compliance with
supplier verification provisions in the preventive controls regulations
were deemed in compliance with the FSVP requirements.
    One comment states that supplier verification activities should not
turn on the entity that is controlling a hazard in a food. The comment
states that verification activities may be needed even when the foreign
supplier does not control the hazard, adding that importers should not
be required to engage in a paperwork exercise to obtain assurances of
their customers' food safety controls. Similarly, another comment
opposes not requiring standard verification activities when a hazard is
to be controlled by the importer or its customer, maintaining that
nearly all suppliers should be subject to verification activities. The
comment states that not requiring any supplier verification would
overlook important issues such as the supplier's compliance with CGMP
requirements and the need for programs to avoid introducing any
unforeseen hazards. The comment also states that the proposal is
problematic because the intended use of the food may not be known at
the time of entry or different parts of a product batch might be
destined for different customers with different processes. However,
elsewhere in its submitted comments, the commenter maintains that FDA
must harmonize the supplier verification provisions in the preventive
controls regulations with the FSVP regulations so that imported
ingredients need only be verified once.
b. Revisions Regarding Importers Subject to the Supplier Program
Provisions in the Preventive Controls Regulations
    As stated previously in this document, elsewhere in this issue of
the Federal Register we are proposing a potential requirement for a
supplier program in the proposed preventive controls regulations.
Therefore, consistent with the discussion in the 2013 FSVP proposed
rule, we propose to specify, in Sec.  1.502(c) in the revised
regulatory text, that if an importer is required to establish and
implement a risk-based supplier program under the preventive controls
regulations (for either human or animal food), and the importer is in
compliance with those requirements, the importer would be deemed in
compliance with the FSVP regulations (except for the requirement to
identify the importer at entry of the food into the United States).
Similarly, under Sec.  1.502(d) in the revised regulatory text, if an
importer's customer is required to establish and implement a risk-based
supplier program under the preventive controls regulations (for either
human or animal food), and the importer annually obtains written
assurance that its customer is in compliance with those requirements,
the importer would be deemed in compliance with the FSVP regulations
(except for the requirement to identify the importer at entry of the
food into the United States and the requirement to maintain records of
the written assurances). Because the importer or its customer would be
performing supplier verification activities under the preventive
controls regulations, we tentatively conclude that this approach
addresses concerns about a lack of supplier verification when the
importer or its customer controls a hazard, while also avoiding
imposing redundant verification requirements.
    However, even though we are proposing to add these provisions
regarding importers who are facilities that are subject to the supplier
program requirements in the preventive controls regulations, we
tentatively conclude that it would not be appropriate to delete the
previously proposed provisions concerning foods with hazards to be
controlled by the importer or its customer. The reason for this is that
we tentatively conclude that it is appropriate to align the FSVP
requirements with the potential supplier program provisions discussed
in the preventive controls proposed rule, should they be adopted. The
potential supplier program requirements would not apply under the
following circumstances:
     When the preventive controls at the receiving facility are
adequate to significantly minimize or prevent each of the significant
hazards in a raw material or ingredient; or
     When the receiving facility relies on its customer to
control the hazard and annually obtains from its customer written
assurance that the customer has established and is following procedures
(identified in the written assurance) that will significantly minimize
or prevent the hazard.
    In such circumstances, requiring an importer that also is a
facility subject to the preventive controls regulations to conduct
foreign supplier verification activities would not impose a redundant
regulatory burden because such importer-facilities would not also be
subject to the preventive controls supplier program requirements.
Nevertheless, we tentatively conclude that it still would impose an

unnecessary burden because the importer's (and/or its customer's)
control of all significant hazards in the food would effectively
resolve the food safety concerns that supplier verification is intended
to address. Therefore, we propose to specify, in Sec.  1.504(g) of the
revised regulatory text (in the hazard analysis section of the proposed
FSVP regulations), that if the preventive controls that an importer
and/or its customer implements under the preventive controls
regulations are adequate to significantly minimize or prevent all
significant hazards in a food, the importer is not required to
determine appropriate foreign supplier verification and related
activities under Sec.  1.505 and is not required to conduct such
activities under Sec.  1.506. Proposed Sec.  1.504(g) further states
that if the importer's customer controls one or more significant
hazards in a food, the importer must annually obtain from the customer
written assurance that it has established and is following procedures
(identified in the written assurance) that will significantly minimize
or prevent the hazard.
5. Hazards Controlled by the Foreign Supplier
    The previous proposed rule set forth two options for the
requirements regarding supplier verification activities for hazards
that are controlled, or for which control is verified, by the
importer's foreign supplier (see previously proposed Sec.  1.506(g),
Options 1 and 2). Option 1 would have established certain requirements
for SAHCODHA hazards to be controlled by the foreign supplier, and
different requirements for non-SAHCODHA hazards and SAHCODHA hazards
that the foreign supplier verified had been controlled by its raw
material or ingredient supplier. (The preamble to the 2013 proposed
rule described a SAHCODHA hazard as one for which a recall of a
violative product posing such hazard is designated as ``Class I'' under
21 CFR 7.3(m)(1).) Option 2 would have required the importer to
determine the supplier verification activity it would use for all
hazards that the foreign supplier controlled or for which it verified
control.
    Under Option 1, for a SAHCODHA hazard that was to be controlled at
the foreign supplier's establishment, the importer would have been
required to conduct and document certain initial and subsequent
periodic (at least annual) onsite audits of the foreign supplier.
Onsite auditing also would be required under Option 1 for
microbiological hazards in certain RACs that are fruits or vegetables.
When onsite auditing alone could not provide adequate assurances that
such a hazard was adequately controlled, the importer would have had to
conduct one or more additional verification activities to provide such
assurances. For non-SAHCODHA hazards to be controlled by the foreign
supplier and all hazards for which the supplier verified control by its
raw material or ingredient supplier, Option 1 would have required that
the importer conduct, upon consideration of the risk presented by the
hazard and the food and foreign supplier's compliance status, one or
more of the following verification activities before using or
distributing the food and periodically thereafter:
     Onsite auditing of the foreign supplier.
     Periodic or lot-by-lot sampling and testing of the food.
     Review of the foreign supplier's food safety records.
     Any other procedure established as being appropriate based
on the risk associated with the hazard.
    On the other hand, Option 2 would have allowed the importer to
determine, for all hazards either controlled by the foreign supplier or
for which the foreign supplier verified control by its supplier, which
of the previously listed verification activities would be appropriate
to verify that the hazard was adequately controlled. In determining the
appropriate verification activities and how frequently they should be
conducted, Option 2 would have required the importer to consider the
risk presented by the hazard, the probability that exposure to the
hazard would result in serious adverse health consequences or death to
humans or animals, and the food and foreign supplier's compliance
status.
a. Comment
    We received many comments in support of Option 1 and many that
favor Option 2. Comments in favor of Option 1 include the following:
     Option 1 would provide greater protection to consumers
than Option 2.
     Option 1 is risk-based in that it would require the most
rigorous form of supplier verification--onsite auditing--when the most
serious hazards are present in food.
     Option 2 would provide too much discretion to importers,
who would have an incentive to choose lower-cost and less effective
verification methods, which could result in an increase in contaminated
imported food.
     A single, streamlined requirement would be more easily
enforced without confusion, and regulated entities often prefer such
clarity.
     Option 1 would reduce industry costs by avoiding the need
for importers to make verification decisions on a product-by-product
basis.
    Comments in favor of Option 2 include the following:
     Option 2 would provide importers with the flexibility
needed to tailor the supplier verification to the particular food and
supplier risk.
     Option 2 is more closely aligned with current industry
practice, which often uses onsite audits but also relies on other
verification methods depending on food and supplier risk.
     Option 2 is more risk-based and would result in a better
allocation of resources by not requiring onsite auditing when it would
not be justified by risk.
     Requiring different supplier verification activities for
different types of hazards in a food is inconsistent with current
industry practice.
     Option 1 could lead importers to simply ``check the box''
that a foreign supplier has been audited rather than analyze the audit
results and consider whether additional verification activities are
needed.
     The SAHCODHA standard is not well understood and might not
be workable as a factor for determining supplier verification
activities.
    One comment recommends what it describes as a hybrid of the two
options. The comment suggests that annual onsite auditing should be the
default requirement for SAHCODHA hazards and for microbiological
hazards for RACs that are fruits or vegetables, but an importer would
be permitted to use alternative verification measures if it could
justify, based on a comprehensive risk assessment, that risks are
reduced and that the alternative measures would adequately verify that
the foreign supplier adequately controlled the hazards.
b. Revisions Regarding Supplier Verification Activities
    Although we acknowledge the concerns regarding Option 2 expressed
by supporters of Option 1, we tentatively conclude that allowing
importers the flexibility to determine the appropriate supplier
verification activity (or activities) based on the importer's
evaluation of food and supplier risks would be a more risk-based
approach. We believe that this would more closely align the
verification requirements with Congress's directive that importers
perform risk-based verification activities. In turn, this should result
in safer imported food by allowing importers to optimize their
verification

efforts in accordance with the relative risks to public health posed by
different foods and suppliers.
    Therefore, we are proposing, in Sec.  1.506(d)(1) in the revised
regulatory text, that importers be required to conduct and document one
or more of four supplier verification activities--onsite auditing,
sampling and testing of food, review of the foreign supplier's food
safety records, or some other appropriate risk-based verification
activity--before initially importing a food and periodically
thereafter. The importer would be required to determine and document
which verification activity or activities are appropriate, as well as
the frequency with which the activities must be conducted, based on the
risk evaluation that the importer conducts for the food and supplier
under proposed Sec.  1.505. As in both Option 1 and Option 2 under the
previous proposed rule, the revised proposal recognizes that for some
foods or foreign suppliers it might be necessary to conduct more than
one verification activity to provide the required assurances (see Sec.
1.506(d)(3) in the revised regulatory text).
    The revised proposal states that an onsite audit of a foreign
supplier must be conducted by a qualified auditor (Sec.
1.506(d)(1)(i)(A) in the revised regulatory text), who is defined as a
person who is a qualified individual and has technical expertise
obtained by a combination of training and experience appropriate to
perform the auditing function (Sec.  1.500 in the revised regulatory
text). (The proposed definition also specifies that a foreign
government employee could be a qualified auditor.) The revised proposal
also states that sampling and testing of a food may be conducted by
either the importer or the foreign supplier (Sec.  1.506(d)(1)(ii)(A)
in the revised regulatory text).
    We are proposing a slight modification to this general rule
regarding verification activities in the case of foods with SAHCODHA
hazards, similar to the ``hybrid'' approach suggested by one comment.
As expressed by some Option 1 supporters, we believe that requiring
onsite auditing when there is a SAHCODHA hazard in a food is risk-based
because it would require what is arguably the most robust supplier
verification activity--annual onsite auditing--for the most serious
hazards in foods. However, we acknowledge the possibility that: (1) Use
of some other verification activity, (2) less frequent onsite auditing,
or (3) some combination of those two approaches could provide adequate
assurances regarding the safety of the food. We also recognize that
although some importers might prefer the ease of not having to make a
determination of appropriate supplier verification activities when a
SAHCODHA hazard is present in a food, others would prefer being able to
tailor verification activities (and the frequency with which they are
conducted) to a particular food and supplier risk profile.
    For these reasons, we are proposing to require, in Sec.
1.506(d)(2) in the revised regulatory text, that when a SAHCODHA hazard
in a food will be controlled by the foreign supplier, the importer must
conduct (or obtain documentation of) initial and subsequent annual
onsite auditing of the foreign suppler unless the importer determines
that other supplier verification activities and/or less frequent onsite
auditing are appropriate to provide adequate assurances regarding the
safety of a particular food and foreign supplier based on the risk
evaluation conducted under Sec.  1.505. This would provide importers
with the certainty of knowing that use of initial and subsequent annual
onsite auditing would satisfy the verification requirement when a
SAHCODHA hazard is present in a food, while allowing importers to use
an alternative verification mechanism(s) if they determine that such
mechanism(s) provide adequate safety assurances.
    We do not believe, as some comments suggest, that making onsite
auditing mandatory when there is a SAHCODHA hazard in a food or, in the
case of our revised proposal, establishing onsite auditing as the
``default'' verification activity in such circumstances, would result
in importers failing to analyze audit results or consider whether
additional verification activities are needed. Both the previous
proposed rule (Sec.  1.506(g)(5) under Option 1) and the revised
proposal (Sec.  1.506(d)(6) in the revised regulatory text) would
require importers to promptly review the results of their verification
activities and, if necessary, take appropriate corrective action. In
addition, under both the previous proposed rule (Sec.  1.506(g)(1)
under Option 1) and the revised proposal (Sec.  1.506(d)(3) in the
revised regulatory text), even when an importer conducts an onsite
audit or obtains an onsite audit report to verify control of a SAHCODHA
hazard in a food, it might be necessary in some circumstances for the
importer to conduct some additional verification.
    We also do not believe that purported uncertainty about the
SAHCODHA standard would make it difficult for importers to comply with
this provision. FDA's Reportable Food Registry Questions and Answers
document discusses the types of violative products that should be
addressed through a Class I recall, which uses the SAHCODHA standard.
In addition, the Agency's weekly FDA Enforcement Report, which is
available at FDA's Web site (http://www.fda.gov/Safety/Recalls/EnforcementReports/default.htm), provides more information about foods
that have been the subject of a Class I recall and the reasons for the
recall. We will consider providing additional guidance to industry to
help clarify what food hazards constitute SAHCODHA hazards under the
FSVP regulations.
    We acknowledge that there may be concerns that the revised proposed
approach to foreign supplier verification activity requirements could
lead some importers to rely on verification activities that might be
inadequate to provide sufficient assurances about the safety of the
imported food. We believe that there are some circumstances, such as
when a SAHCODHA hazard is present in a food, in which onsite auditing
on an annual basis likely would be needed to ensure proper verification
of suppliers. However, in some cases, including even when a SAHCODHA
hazard is present, we believe it is possible that alternative supplier
verification activities would provide adequate assurances of food
safety. An importer who chose to conduct such an alternative activity
would need to maintain documentation that the activity provides
adequate assurances of safety; this documentation would be available
for FDA review during any inspection of the importer. To address
concerns that the revised proposal may allow too much discretion, and
to assist importers in meeting the verification requirements, we
anticipate that we will provide guidance to industry on the
circumstances (incorporating both food and supplier risks) under which
onsite auditing of foreign suppliers and/or other supplier verification
approaches are appropriate for providing adequate assurances regarding
the safety of the food produced by a foreign supplier.
6. Food From Farms That Are Not Covered Farms Under the Proposed
Produce Safety Regulations
    In addition to the just-discussed revisions concerning supplier
verification activities, we are proposing to include a revision
regarding food from foreign suppliers that are farms but not ``covered
farms'' subject to the produce safety regulations. We are making this
change to reflect the different treatment of food from such farms under
the proposed produce

safety regulations and to be consistent with the potential requirement
for a supplier program in the proposed preventive controls regulations.
    Under Sec.  1.506(d)(4) in the revised regulatory text, if a
foreign supplier of a food is a farm that is not subject to the
requirements in part 112 (the produce safety regulations) in accordance
with Sec.  112.4 regarding the food being imported, the importer would
not be subject to the FSVP supplier verification activity requirements
in revised Sec.  1.506(d)(1) and (d)(2) if the importer:
     Documented, at the end of each calendar year, that the
food provided by the foreign supplier was not subject to part 112; and
     obtained written assurance, at least every 2 years, that
the foreign supplier was producing the food in compliance with the FD&C
Act.
    These alternative verification requirements would apply to
importers of food from the following:
     Farms that do not grow and harvest ``produce,'' as defined
in Sec.  112.3(c) of the proposed produce safety regulations. For
example, because food grains are not produce, the alternative
verification requirements would apply to importers of food grain.
     Farms that grow and harvest produce that is not covered by
the proposed produce safety regulations in accordance with proposed
Sec.  112.1. Such ``non-covered produce'' includes produce that is
rarely consumed raw, produce that is produced for personal consumption
or for consumption on the farm or another farm under the same
ownership, and produce that is not a RAC.
     Farms that are not ``covered farms'' because they produce
an average annual monetary value of produce of no more than $25,000
(see proposed Sec.  112.4(a)).
     Farms that are not covered farms because they satisfy the
requirements for a qualified exemption from the proposed produce safety
regulations under proposed Sec.  112.5 (including requirements
concerning direct sale to qualified end-users) and the exemption has
not been withdrawn.
    Because FDA has determined that these farms either: (1) Should not
be subject to the produce safety regulations or (2) should not be
required to comply with the ``standard'' requirements applicable to
covered activities conducted for covered produce, we tentatively
conclude that it is appropriate to similarly not require importers of
food from such farms to conduct the ``standard'' supplier verification
activities. We request comment on the proposed alternative method of
supplier verification of obtaining written assurance of compliance with
the FD&C Act by these farms.
7. Documentation of Foreign Supplier Verification Activities
    The proposed rule does not specify what documentation of onsite
audits of foreign suppliers importers must maintain. At the public
meetings on the FSVP proposed rule and in other meetings with
stakeholders, we invited comment on what documentation of onsite audits
importers should be required to have. We also stated that for onsite
audits conducted for FSVP purposes, importers would not be required to
obtain a regulatory audit report as required for audits conducted by
accredited auditors/certification bodies under FDA's proposed rule on
``Accreditation of Third-Party Auditors/Certification Bodies to Conduct
Food Safety Audits and to Issue Certifications'' (78 FR 45782, July 29,
2013).
    With respect to documentation of sampling and testing of an
imported food, the proposed rule (Sec.  1.506(g)(2)(ii) under Option 1)
specified a certificate of analysis (COA) containing the results of
testing as an example of appropriate documentation but did not require
a particular form or forms of documentation. The preamble to the
proposed rule suggested certain information that might be included in a
COA (78 FR 45730 at 45757). Similarly, the proposed rule (Sec.
1.506(g)(2)(iii) under Option 1) included records of a foreign
supplier's audit of its supplier's hazard control activities as an
example of appropriate documentation of review of a foreign supplier's
food safety records but did not require a specific form of
documentation. The preamble to the proposed rule states that food
safety records are records documenting that the hazard control
procedures established by the supplier are being followed and are
adequately controlling the hazards (78 FR 45730 at 45756). The proposed
rule provided no example of appropriate documentation of other
verification procedures determined by the importer to be appropriate.
a. Comments
    Several comments state that importers should not be required to
share foreign supplier audit reports with FDA. The comments state that
because such reports often include confidential business information
and findings of flaws in safety systems, requiring that the reports be
made available to the Agency might make suppliers less likely to allow
audits or result in less robust audits. Some comments suggest that
importers be required to maintain documentation that an audit was
conducted (the date of the audit and the name of the auditor) and
documentation of the completion of any corrective actions in response
to significant deficiencies.
    Regarding documentation of sampling and testing, one comment
encourages us not to specify requirements for the content of COAs
because this could change over time and is better left to industry to
determine.
b. Revisions Regarding Documentation of Supplier Verification
Activities
    We acknowledge the concerns about requiring importers to document
onsite audits of foreign suppliers with the full reports of those
audits. We do not believe that importers should be required to make
full audit reports available to us in an FSVP inspection. We understand
that a foreign supplier might be reluctant to submit to onsite auditing
if the full report of the audit would be made available to us, and we
do not believe that we need to review the full audit report to
determine whether an appropriate audit was conducted and any
significant problems were corrected. Accordingly, we now are revising
the proposed provisions regarding onsite auditing of foreign suppliers
to require importers to retain documentation of the following: The
audit procedures, the dates the audit was conducted, the conclusions of
the audit, any corrective actions taken in response to significant
deficiencies identified during the audit, and documentation that the
audit was conducted by a qualified auditor (Sec.  1.506(d)(1)(i)(C) in
the revised regulatory text). We tentatively conclude that this
requirement would enable us to determine whether an appropriate audit
of the foreign supplier was conducted and whether the importer used the
audit results appropriately, while preserving the benefits of the
confidentiality of the audit reports.
    We also are proposing to specify documentation requirements for
other supplier verification activities. The revised proposal (Sec.
1.506(d)(1)(ii)(B) in the revised regulatory text) states that
documentation of an incidence of sampling and testing (which under
Sec.  1.506(d)(1)(ii)(A) may be conducted either by the importer or the
foreign supplier) must include the following: Identification of the
food tested (including lot number, as appropriate), the number of
samples tested, the test(s) conducted (including the analytical
methods(s) used), the date(s) on which the test(s) were conducted, the
results of

the testing, any corrective actions taken in response to detection of
hazards, and information identifying the laboratory conducting the
testing.
    The revised proposal (Sec.  1.506(d)(1)(iii) in the revised
regulatory text) states that documentation of each review of foreign
supplier safety records must include the date(s) of review, any
corrective actions taken in response to significant deficiencies
identified during the review, and documentation that the review was
conducted by a qualified individual.
    The revised proposal does not specify how importers must document
other appropriate supplier verification activities that they conduct.
We request comment on whether the regulations should specify the form
of such documentation and, if so, what form such documentation should
take.
8. Independence of Qualified Individuals Conducting Verification
Activities
    The previous proposed rule specifies that a qualified individual
who conducts any of the supplier verification activities must not have
a financial interest in the foreign supplier and payment of the
qualified individual must not be related to the results of the activity
(proposed Sec.  1.506(g)(6) (under Option 1)). The proposal states that
this requirement would not prohibit an importer or one of its employees
from conducting the verification activity. In the preamble to the 2013
proposed rule, we requested comment on whether and, if so, how the
regulations should specify what constitutes a financial interest (78 FR
45730 at 45759).
a. Comments
    Many comments express support for prohibiting persons who conduct
supplier verification activities from having a financial interest in
the foreign supplier whose operations they are evaluating, as well as
support for the ban on linking remuneration to the results of
verification activity (i.e., payment for a favorable assessment). One
comment states that we should specify what constitutes a financial
interest to ensure that audits are not performed by persons with a
financial interest in the foreign supplier, and requests that we
provide a standard disclosure form regarding financial interests.
b. Request for Further Comment
    At this time, we are not making any revisions to the proposed
requirement that persons conducting supplier verification activities
not have a financial interest in the foreign supplier and that payment
to such a person must not be related to the results of the activity
they have performed. However, in the Preventive Controls supplemental
document, we are requesting comment on whether the potential supplier
program requirements, should they be included in the final rule,
include provisions to address the independence of persons who conduct
supplier verification activities. We ask in that document whether such
conflict of interest requirements should be directed to a subset of
persons who conduct verification activities (such as auditors) or
whether they should encompass all persons who conduct verification
activities. We also ask whether requirements such as those in the FSVP
proposed rule would be appropriate or whether we should instead adopt
different requirements, such as a requirement that persons be free of
conflicts of interest that are relevant to the outcome of the
verification activity conducted. In addition, we ask what should
constitute a financial interest, including whether owning stock in a
company should constitute a financial interest.
    In light of our statements in the Preventive Controls supplemental
document, we renew our request for comment on the provisions in the
FSVP proposed rule on the independence of qualified individuals
conducting verification activities and invite comment (in the context
of the FSVP regulations) on the additional conflict of interest issues
raised in the Preventive Controls supplemental document.

D. Definitions of Very Small Importer and Very Small Foreign Supplier

    The 2013 proposed rule specified certain modified FSVP requirements
for very small importers and importers of food from very small foreign
suppliers. Proposed Sec.  1.500 defined a ``very small importer'' as an
importer, including any subsidiary, affiliate, or subsidiaries or
affiliates, collectively, of any entity of which the importer is a
subsidiary or affiliate, whose average annual monetary value of sales
of food during the previous 3-year period (on a rolling basis) is no
more than $500,000, adjusted for inflation. Proposed Sec.  1.500
defined a ``very small foreign supplier'' as a foreign supplier,
including any subsidiary, affiliate, or subsidiaries or affiliates,
collectively, of any entity of which the foreign supplier is a
subsidiary or affiliate, whose average annual monetary value of sales
of food during the previous 3-year period (on a rolling basis) is no
more than $500,000, adjusted for inflation.
    We stated in the preamble to the proposed rule that the limitation
of $500,000 in annual food sales was consistent with the sales
limitation in the definition of ``qualified facility'' in the
Preventive Controls proposed rule and ``small business'' in the Produce
Safety proposed rule. We requested comment on this proposed approach to
the definitions of very small importer and very small foreign supplier
(78 FR 45730 at 45744). We also requested comment on whether and, if
so, how these definitions should take into account the proposed
definition of ``very small business'' in the Preventive Controls
proposed rule, for which we posed three alternative dollar-value
ceilings: $250,000, $500,000, and $1 million.
1. Comments
    Several comments oppose modified requirements for very small
importers and importers of food from very small foreign suppliers
regardless of the sales dollar-value ceiling. Reasons specified for
such opposition include the following: Congress did not exempt very
small importers from the FSVP requirements; smaller operations may be
more likely than larger ones to lack adequate verification or control
systems because they have fewer resources; the effect of the FSVP
regulations could be undermined if importers and foreign suppliers
tried to manipulate their facilities or operations to avoid the
``standard'' requirements; and many small foreign suppliers would
already be exempt from the preventive controls or produce safety
regulations and should not benefit from an exemption from verification
for their U.S. importers.
    Several comments support the proposed $500,000 annual food sales
ceiling as a reasonable limit on eligibility for the ``very small''
modified FSVP requirements. Other comments maintain that a $1 million
ceiling would better reflect the types of very small importers and
foreign suppliers operating today. One comment proposes that FDA set
the annual sales ceiling at $2 million to be consistent with how
``small companies'' are defined in Japan.
    Some comments state that other factors, either instead of, or in
addition to, the monetary value of food sales, should be considered in
defining very small importers and very small foreign suppliers. Some
comments maintain that a more appropriate eligibility standard would be
volume of food handled or sold, reflecting the fact that sales revenues
vary by type of food, origin, quantity, price, and inflation rates. One
comment states that a very

small foreign supplier should be defined as one that has fewer than 100
employees, contending that use of a monetary value ceiling would
provide an unfair advantage to foreign firms because many foreign
suppliers are located in countries with currencies valued lower than
the U.S. dollar.
    Several comments state that the definitions of very small importer
and very small foreign supplier should align with the definition of
very small business under the preventive controls regulations. The
comments state that such alignment is needed to reduce unnecessary
confusion, help FDA achieve its stated goal of aligning the FSVP
provisions with the supplier verification provisions in the preventive
controls regulations, and ensure that the regulations are consistent
with U.S. international trade obligations.
2. Revisions Regarding Definitions of Very Small Importer and Very
Small Foreign Supplier
    We are revising the proposed definitions of very small importer and
very small foreign supplier by increasing the annual food sales ceiling
from $500,000 to $1 million, consistent with the revised proposed
definition of very small business set forth in the Preventive Controls
supplemental document published elsewhere in this issue of the Federal
Register. The preamble to the Preventive Controls supplemental document
states that defining a very small business as a business that has less
than $1 million in total annual sales of human food adjusted for
inflation would simplify a food facility's determination of whether it
is a qualified facility under the preventive controls regulations
because the facility would only need to calculate its total sales of
human food rather than determine how much food was sold to qualified
end users. The preamble to the Preventive Controls supplemental
document also notes that FDA estimates that businesses with less than
$1 million in total annual food sales produce less than one percent of
the dollar value of food that is produced in the United States that
would be covered by the preventive controls regulations in the absence
of special provisions for very small businesses. The preamble further
states that we are not basing the proposed definition of very small
business on the number of employees or the volume of food sold because
the statutory criteria for qualified facilities (of which very small
businesses are a subset) focus on monetary value of sales, rather than
volume of sales or number of employees.
    To more appropriately reflect the risk to public health posed by
the volume of food imported by very small importers and importers of
food from very small foreign suppliers, as well as to align the
proposed FSVP regulations with the proposed preventive controls
regulations, we tentatively conclude that the monetary value ceiling in
the definitions of very small importer and very small foreign supplier
should be $1 million, adjusted for inflation. Consistency with the
monetary value ceiling in the proposed definition of very small
business under the proposed Preventive Controls for Human Food
regulations, rather than the monetary value ceiling in the so-called
Tester Amendment criteria for the definition of qualified facility
(under section 418(l)(1) of the FD&C Act, is appropriate because use of
the $1 million ceiling (instead of, for example, a ceiling of $250,000)
means that any facility with sales below the ceiling would meet the
definition of a qualified facility. We request comment on whether the
revised proposed monetary value ceiling of $1 million, adjusted for
inflation, for very small importers and very small foreign suppliers is
appropriate, as well as on whether it is appropriate that the ceiling
be the same as that specified in the definition of very small business
under the preventive controls regulations.
    As previously noted, the produce safety proposed rule includes
provisions applicable to ``small businesses,'' which are defined as
having annual produce sales of no more than $500,000; the proposed rule
also includes provisions for ``very small businesses,'' which are
defined as having annual produce sales of no more than $250,000. In
addition, farms with produce sales of no more than $25,000 would not be
covered under the proposed produce safety regulations. We also note
that the revised proposed regulations on preventive controls for food
for animals define ``very small business'' as having annual sales of
animal food of less than $2,500,000. We request comment on whether and,
if so, how the FSVP regulations should take into account these
definitions and provisions applicable to smaller entities under the
regulations on produce safety and preventive controls for animal food.
    As with all other matters not specifically addressed in this
supplemental notice of proposed rulemaking, we are still considering
the comments that we have received concerning other aspects of the
proposed modified provisions for very small importers and importers of
food from very small foreign suppliers. These issues include, but are
not limited to, whether the regulations should include any such
modified provisions and, if so, what the modified requirements should
be and whether the food sales to be considered for determination of
eligibility should be limited to sales in or to the United States,
rather than all food sales of an importer or foreign supplier. We will
address comments on these issues and finalize any requirements for very
small importers and importers of food from very small foreign suppliers
in the FSVP final rule.

E. Other Related Revisions

    We are making other revisions to the proposed rule to incorporate
the changes that we are making regarding food and foreign supplier risk
evaluations and supplier verification activities.
1. FSVP Reassessments
    We are revising the proposed requirement in Sec.  1.508 of the
previous proposal for importers to reassess the effectiveness of their
FSVPs to be consistent with our amended proposal requiring importers to
evaluate food and foreign supplier risks. Section 1.508(a)(2) in the
revised regulatory text would require an importer to promptly reassess
the effectiveness of its FSVP for a food when it becomes aware of new
information about potential risks associated with the food or foreign
supplier of the food, instead of when the importer becomes aware of
information about potential food hazards, as under previous Sec.
1.508(a)(2).
    Similarly, Sec.  1.508(b) in the revised regulatory text would
require that, in conducting an FSVP reassessment, an importer update
its risk evaluation for a food and foreign supplier rather than, as
under previous Sec.  1.508(b), updating only the hazard analysis the
importer conducted. If the reassessment led to a change in the
identified risks, the importer would need to determine whether it
needed to change its verification activities.
2. Records
    We are revising the proposed recordkeeping requirements to reflect
the previously discussed proposed amendments regarding: (1) Importers
whose customers are in compliance with the supplier program
requirements of the preventive controls regulations, (2) importers
whose customers are controlling a significant hazard in a food, and (3)
documentation requirements for supplier verification activities. Under
previous Sec.  1.510(d)(2), importers would have been required to
maintain for at least 2 years (after the records were created or
obtained)

records of certain supplier verification activities, investigations and
corrective actions, FSVP reassessments, food subject to certain dietary
supplement CGMP regulations, and food imported from a country with an
officially recognized or equivalent food safety system (except that
records of changes to FSVPs in accordance with the corrective actions
or reassessment provisions would have had to be maintained until at
least 2 years after their use was discontinued).
    Under Sec.  1.510(d)(2) in the revised regulatory text, importers
would be required to maintain for at least 2 years (after the records
were created or obtained) records of, among other things, written
assurances from their customers that are in compliance with the
supplier program requirements of the preventive controls regulations
and documentation of supplier verification activities that importers
conduct. Also subject to this requirement would be written assurances
from importers' customers that the customer has established and is
following procedures that will significantly minimize or prevent a
hazard. With respect to records concerning the importation of dietary
supplements, Sec.  1.510(d)(2) in the revised regulatory text makes
clear that this 2-year requirement would apply to written assurances of
compliance with the dietary supplement CGMPs obtained from importers'
customers and documentation of supplier verification activities
conducted by importers of dietary supplements (discussed in section
II.E.3).
3. Dietary Supplements
    We are revising the proposed modified FSVP requirements for
importers of dietary supplements in Sec.  1.511 of the proposed rule to
reflect previously discussed revisions to the proposed rule. We are
revising previously proposed Sec.  1.511(a) and (b) to specify that
importers of dietary supplements and dietary supplement components that
are subject to certain dietary supplement CGMP regulations in part 111
(21 CFR part 111) (or whose customers are subject to those regulations)
would not be required to comply with revised Sec.  1.506(a), concerning
the requirement to establish and follow written procedures to ensure
the use of approved suppliers (which replaces the previously proposed
requirement to maintain a written list of foreign suppliers). This
change is appropriate because these importers would not be required to
conduct risk evaluations, which provide the basis for supplier
approval. However, we request comment on whether some other requirement
concerning identification of foreign suppliers would be appropriate for
these importers, such as a requirement, as originally proposed, to
maintain a list of the foreign suppliers of the dietary supplements and
dietary supplement components they import.
    We also are revising several of the provisions in previously
proposed Sec.  1.511(c) regarding importers of dietary supplements that
will not be further processed. First, we are revising Sec.  1.511(c)(1)
to specify that although importers of these ``finished'' dietary
supplements would not be required to analyze the hazards in the dietary
supplements they import, they would be required to evaluate the other
food safety risks set forth in Sec.  1.505(a) in the revised regulatory
text. Second, under Sec.  1.511(c)(2) in the revised regulatory text,
importers of these dietary supplements would be required to establish
and follow written procedures to ensure that foods are imported only
from approved suppliers (except in the limited circumstances when
unapproved suppliers may be used), rather than having to maintain a
list of their foreign suppliers. Third, Sec.  1.511(c)(4) in the
revised regulatory text now specifies that the purpose of supplier
verification activities with respect to these dietary supplements is to
provide assurances that the supplier is producing the dietary
supplement in accordance with processes and procedures that provide the
same level of public health protection as those required under part
111. Finally, in Sec.  1.511(c)(5)(i) through (c)(5)(iv) in the revised
regulatory text, we are proposing requirements for documentation of
foreign supplier verification activities by these importers that match
those discussed in section II.C.5.
4. Very Small Importers and Importers of Food From Very Small Foreign
Suppliers
    We are revising, in Sec.  1.512 in the revised regulatory text, the
proposed modified FSVP requirements for very small importers and
importers of food from very small foreign suppliers by deleting the
proposed requirement to maintain a list of foreign suppliers.
Consistent with our approach to requirements for very small businesses
under the potential supplier program provisions in the preventive
controls proposed rule, we are not proposing to require very small
importers and importers of food from very small foreign suppliers to
institute procedures to verify receipt of food from approved foreign
suppliers.
5. Food From Countries With Officially Recognized or Equivalent Food
Safety Systems
    We are revising, in Sec.  1.513 in the revised regulatory text, the
proposed modified FSVP requirements for importers of food from foreign
suppliers in countries whose food safety system FDA has officially
recognized as comparable or determined to be equivalent to that of the
United States by renumbering references to sections of the regulations
and by deleting the requirement to maintain a list of foreign
suppliers. We tentatively conclude that, given the nature of the food
that may be imported in accordance with these modified provisions
(e.g., that the food is from a foreign supplier in good compliance
standing with the food safety authority in a country with a comparable
or equivalent food safety system), it is not necessary to apply a
requirement to establish a procedure to verify receipt of food from
approved suppliers to importers of such food.
6. Qualified Individuals
    We are revising previously proposed Sec.  1.503, ``Who must develop
my FSVP and perform FSVP activities?'', to revise a reference to
proposed Sec.  1.512, regarding the modified requirements for very
small importers and importers of food from very small foreign
suppliers. Previously proposed Sec.  1.503 states that except with
respect to the requirements in Sec. Sec.  1.506(a), 1.509, 1.510,
1.511(c)(2), and 1.512(b)(3) and (b)(6), a qualified individual must
develop their FSVP and perform each of the activities required under
the subpart. Previously proposed Sec.  1.512(b)(3) stated the proposed
requirement to maintain a written list of foreign suppliers, a
requirement that is being deleted by this supplemental document.
Previously proposed Sec.  1.512(b)(6) referred to records requirements,
which have been renumbered as Sec.  1.512(b)(5) in the revised
regulatory text. Therefore, Sec.  1.503 should be modified to refer
only to Sec.  1.512(b)(5).

III. Preliminary Regulatory Impact Analysis

    As explained in the 2013 FSVP proposed rule, we performed the
necessary analyses to examine the impacts of the proposed rule under
Executive Order 12866, Executive Order 13563, the Regulatory
Flexibility Act (5 U.S.C. 601-612), the Unfunded Mandates Reform Act of
1995 (Pub. L. 104-4), and the PRA (44 U.S.C. 3501-3520). We provided a
preliminary regulatory impact analysis (PRIA) of the proposed rule (see
Ref. 13 of the

proposed rule) for public input (78 FR 45730 at 45770).
    We performed additional analyses to examine the impacts of the
revised proposed provisions described in this Federal Register document
under Executive Order 12866, Executive Order 13563, the Regulatory
Flexibility Act, the Unfunded Mandates Reform Act of 1995, and the PRA.
We present our additional analyses, including the total estimated costs
and benefits of the FSVP proposed rule as revised, in our supplemental
PRIA for this proposed rule (Ref. 3). We seek comment on our additional
analyses.

IV. Paperwork Reduction Act of 1995

    This proposed rule contains information collection requirements
that are subject to review by the OMB under the PRA (44 U.S.C. 3501-
3520). A description of these provisions is given in the Description
section with an estimate of the annual reporting, recordkeeping, and
third-party disclosure burden. 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.
    FDA invites comments on: (1) Whether the proposed collection of
information is necessary for the proper performance of FDA's functions,
including whether the information will have practical utility; (2) the
accuracy of FDA's estimate of the burden of the proposed collection of
information, including the validity of the methodology and assumptions
used; (3) ways to enhance the quality, utility, and clarity of the
information to be collected; and (4) ways to minimize the burden of the
collection of information on respondents, including through the use of
automated collection techniques, when appropriate, and other forms of
information technology.
    Title: Foreign Supplier Verification Programs for Importers of Food
for Humans and Animals.
    Description: FDA is revising its proposed regulations on FSVPs for
food for humans and animals. The proposed regulations are intended to
help ensure that food imported into the United States is produced in
compliance with processes and procedures, including reasonably
appropriate risk-based preventive controls, that provide the same level
of public health protection as the processes and procedures required
for production of food in compliance with section 418 or 419 of the
Federal Food, Drug, and Cosmetic Act (FD&C Act) (21 U.S.C. 350g or
350h), if either is applicable, and in compliance with sections 402 and
403(w) of the FD&C Act (21 U.S.C. 342 and 343(w)). The revisions to the
proposed rule include the following: (1) Specifying a revised approach
to proposed requirements for supplier verification activities (the
previous proposal contained two alternative approaches); (2) stating
that importers who are in compliance with the potential supplier
program provisions of the preventive controls regulations would be
deemed in compliance with most of the FSVP requirements; (3) deleting
the proposed requirement that importers conduct a food and foreign
supplier compliance status review but adding a proposed requirement
that importers consider, in addition to the hazards in the food they
import, certain factors related to supplier risks; (4) proposing to
require importers to follow written procedures for ensuring the use of
suppliers that they have approved based on their evaluation of supplier
risks, rather than require importers to maintain a list of suppliers;
(5) proposing to require importers of food from farms not subject to
the produce safety regulations to obtain written assurance of
compliance from their suppliers rather than conduct standard
verification activities; and (6) revising the definitions of very small
importer and very small foreign supplier by increasing the annual food
sales limit from $500,000 to $1 million.
    Description of Respondents: Generally, persons who import food into
the United States. We estimate that there are approximately 56,800
persons who meet the definition of importer set forth in the proposed
rule. However, the proposed rule would exempt from the FSVP
requirements the importation of certain foods, including certain juice
and seafood products, food for research or evaluation (exempt but
subject to a third-party disclosure requirement), food for personal
consumption, certain alcoholic beverages, food that is transshipped,
and food that is imported for further processing and future export. The
proposed rule also would specify that importers who are in compliance
with any supplier program provisions that the preventive controls final
regulations may include would be deemed in compliance with most of the
FSVP requirements.
    Certain exceptions to the standard FSVP requirements would apply to
importers of food for which the importer or its customer controls the
hazards and to importers of food from farms not subject to the produce
safety regulations. In addition, the proposed rule would establish
modified FSVP requirements for importers of dietary supplements, very
small importers, importers of food from very small foreign suppliers,
and importers of food from suppliers in countries whose food safety
systems FDA has officially recognized as comparable or determined to be
equivalent to that of the United States.
    The information collection estimate for the FSVP proposed rule has
decreased due to revisions to the proposed rule requirements. The
information collection burden was previously estimated to be 3,303,988
hours; the revised estimate is 2,917,603 hours, a reduction of 386,385
hours. For more information on the original calculation of the
information burden estimate, refer to the PRA for the previous proposed
rule (Docket No. FDA-2011-N-0143).

Information Collection Burden Estimate

Supplemental Notice of Proposed Rulemaking Burden

    FDA estimates the burden for this information collection as
follows:

A. Reporting Burden

1. Exemption for Food for Research or Evaluation
    Under proposed Sec.  1.501(c), the FSVP regulations would not apply
to food that is imported for research or evaluation purposes, provided
that:
     The food is not intended for retail sale and is not sold
or distributed to the public.
     The food is labeled with the statement ``Food for research
or evaluation use.''
     When filing entry for the food with U.S. Customs and
Border Protection (CBP), the customs broker or filer for the food
provides an electronic declaration that the food will be used for
research or evaluation purposes and will not be sold or distributed to
the public.
    As shown in table 1, we estimate that annually there will be 36,360
persons for whom a declaration that a food will be used for research or
evaluation purposes will be submitted, and that about 40 declarations
will be submitted for each such person annually. We further estimate
that submission of this declaration should take approximately 0.083
hours, resulting in a total annual burden of 120,715 hours. There is no
change from the previous estimated burden.
2. Importer Identification at Entry
    Proposed Sec.  1.509(c) would require importers to ensure that, for
each line entry of food product offered for importation into the United
States, its name and Dun and Bradstreet Data

Universal Numbering System (DUNS) number is provided electronically
when filing entry with CBP. As shown in table 1, we estimate that each
of the estimated 56,800 importers would need to ensure that this
information is provided for an average of 157 line entries each year.
We further estimate that each such submission would require 0.02 hours,
resulting in a total annual burden of 178,352 hours. There is no change
from the previous estimated burden.
    FDA estimates the burden of this collection of information as
follows:

                                                     Table 1--Estimated Annual Reporting Burden \1\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Number of
               21 CFR Section                    Number of     responses per   Total annual           Average burden per response           Total hours
                                                respondents     respondent       responses
--------------------------------------------------------------------------------------------------------------------------------------------------------
Exemption for food for research 1.501(c)....          36,360              40       1,454,400  0.083 (5 minutes).........................         120,715
DUNS number for filing with CBP 1.509(c),             56,800             157       8,917,600  0.02 (1.2 minutes)........................         178,352
 1.511(c), 1.512(b)(2).
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