[Federal Register Volume 59, Number 2 (Tuesday, January 4, 1994)]
[Rules and Regulations]
[Pages 350-354]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 93-31812]


[[Page Unknown]]

[Federal Register: January 4, 1994]


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Part II





Department of Health and Human Services





_______________________________________________________________________



Food and Drug Administration



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21 CFR Parts 20 and 101



Food Labeling; General Requirements; Final Rules and Proposed Rule
DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Part 101

[Docket No. 93N-0478]
RIN O905-ADO8 and O905-AB68

 

Dietary Supplements; Establishment of Date of Application

AGENCY: Food and Drug Administration, HHS.

ACTION: Final rule.

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SUMMARY: The Food and Drug Administration (FDA) is publishing this 
final rule to establish July 1, 1995, as the date on which it will 
apply the mandatory nutrition labeling and nutrient content claims 
provisions of the Federal Food, Drug, and Cosmetic Act (the act) to 
dietary supplements of vitamins, minerals, herbs, and other similar 
nutritional substances (hereinafter referred to as dietary 
supplements). This action is in accordance with the Dietary Supplement 
Act of 1992 (the DS act) and the Nutrition Labeling and Education Act 
of 1990 (the 1990 amendments), which allows the Secretary of Health and 
Human Services (the Secretary) (and, by delegation, FDA) to delay, for 
up to 1 year, the date on which FDA applies those provisions to foods 
(including dietary supplements) if the agency finds that compliance 
with them would cause ``undue economic hardship.''

EFFECTIVE DATE: July 1, 1995.

FOR FURTHER INFORMATION CONTACT: Laina M. Bush, Center for Food Safety 
and Applied Nutrition (HFS-726), Food and Drug Administration, 200 C 
St. SW., Washington, DC 20204, 202-205-5271.

SUPPLEMENTARY INFORMATION: 

I. Background

    On November 8, 1990, President Bush signed into law the 1990 
amendments (Pub. L. 101-535). This statute adds to the Federal Food, 
Drug, and Cosmetic Act (the act) among other sections, section 403(q) 
(21 U.S.C. 343(q)), which makes nutrition labeling mandatory for most 
foods, and section 403(r)(2) (21 U.S.C. 343(r)(2)), which gives FDA 
authority to define nutrient content claims.
    In accordance with the 1990 amendments, FDA published proposed 
rules on November 27, 1991 (56 FR 60366 et seq.), and final rules on 
January 6, 1993 (58 FR 2066 et seq.) implementing, among other things, 
the sections of the act on mandatory nutrition labeling and nutrient 
content claims, among other things, for foods in conventional food 
form. Because of the DS act, the final regulations did not include 
provisions on the nutrition labeling of, or nutrient content claims 
for, dietary supplements.
    The DS act (Pub. L. 102-571) was signed into law on October 6, 
1992. In section 202(a)(1), the DS act established a moratorium until 
December 15, 1993, on the implementation of the 1990 amendments with 
respect to dietary supplements that are not in the form of conventional 
food. Section 202(a)(2) of the DS act required the Secretary (and, by 
delegation, FDA) to issue new proposed regulations that are applicable 
to dietary supplements no later than June 15, 1993, and final 
regulations by December 31, 1993. On June 18, 1993, FDA issued proposed 
regulations in response to this provision of the DS act (58 FR 33700 et 
seq.). Elsewhere in this issue of the Federal Register, FDA is issuing 
the final rules.
    Under section 10(a)(1)(A) and (B) of the 1990 amendments (21 U.S.C. 
343 note), section 403(q) and (r)(2) of the act are effective 6 months 
after the promulgation of final regulations or after the date that 
proposed regulations are considered to be final regulations. Thus, 
because the final regulations on the nutrition labeling of, and 
nutrient content claims for, dietary supplements are being issued on 
January 4, 1994, section 403(q) and 403(r)(2) will be effective with 
respect to dietary supplements July 5, 1994. However, section 
10(a)(3)(B) of the 1990 amendments provides that if the Secretary and, 
by delegation, FDA      `` * * * finds that compliance with sections 
403(q) and 403(r)(2) of such Act would cause an undue economic 
hardship, the Secretary may delay the application of such sections for 
no more than one year.''
    FDA found such ``undue economic hardship'' existed for the 
conventional food industry in a final rule published on January 6, 1993 
(58 FR 2070), entitled ``Food Labeling: Establishment of Date of 
Application'' (hereinafter called the date of application final rule). 
In that document, FDA delayed the application of section 403(q) and 
(r)(2) for 1 year, until May 8, 1994.
    In the proposed rules on nutrition labeling (58 FR 33715 at 33725) 
and nutrient content claims (58 FR 33731 at 33748) for dietary 
supplements, FDA asked for comment on whether a similar delay in 
application of section 403(q) and (r)(2) would be appropriate for 
dietary supplements. The agency gave interested persons until August 
17, 1993, to comment on whether the 6-month proposed compliance date 
would cause ``undue economic hardship.'' FDA received approximately 
2,000 letters of which approximately one-third contain one or more 
comments concerning either the date of application or other economic 
issues from consumers, consumer advocacy organizations, health care 
professionals, professional societies, universities, manufacturers, 
distributors, retailers, trade associations, and State governments. A 
discussion of the agency's decision, and a summary of the comments, 
concerning the delay of the date of application and other economic 
issues and the agency responses follow.

II. Undue Economic Hardship

A. Comments

    Several comments requested that FDA extend the date that the 
nutrition labeling and nutrient content claim provisions of the act 
will be applied to dietary supplements. Most comments requested an 
additional year, for a total compliance period of 18 months. One 
comment proposed a delay of at least 9 months. The comments reported 
many examples of the difficulties in meeting a 6-month compliance 
period. Several comments stated that the amount of time needed to 
redesign labels would far exceed the resources available. One comment 
reported that the insufficient time allowed to revise labels would 
result in some products being removed from the market temporarily while 
new labels are being prepared. An additional comment requested the 
extension because of the difficulties in the logistics of revising 
existing labels, printing, packaging, and exhausting existing label 
supplies with a short compliance period.
    Other comments that requested a delay cited the savings that could 
be gained with insignificant loss of benefits. One comment reported 
that inventory disposal could be reduced by 85 percent with an 18-month 
compliance period. Another comment stated that FDA's cost estimate of 
$20 million represents 1 percent of industry sales but a much larger 
percentage of industry profits. The comment explained that extending 
the compliance period would reduce the costs of compliance and, 
therefore, minimize any reduction in profits.
    One comment requested a delay because there will be additional 
costs for compliance with the upcoming United States Pharmacopoeia 
(USP) standards. The comment stated that resources could be better 
spent if these compliance efforts were completed concurrently rather 
than consecutively.
    One comment requested a delay because of the overlap with the final 
months of the extended period that was allowed for foods in 
conventional food form. The comment reported that many conventional 
food manufacturers and their label suppliers are rushing to produce 
final labels for such foods. The comment said that supplement 
manufacturers will not be able to secure revised labels for their 
products from label manufacturers in time to meet a 6-month deadline 
because of the competition for label manufacturers' resources.
    The agency agrees that it will be difficult for dietary supplement 
manufacturers to comply within 6 months, especially in light of the 
fact that label suppliers are currently stressed with label orders from 
manufacturers of food in conventional food form who are attempting to 
meet the May 1994 deadline for complying with the 1990 amendments. The 
agency also agrees that an extension of the date of application would 
result in significant savings for the industry. Administrative costs, 
printing costs, and label inventory disposal costs are all dependent on 
the length of the compliance period. The agency has determined that the 
costs of the regulations could be reduced with an extension.
    The agency made a determination in the date of application final 
rule that the 1990 amendments will result in an undue economic hardship 
on manufacturers of food products in conventional food form (58 FR 2070 
at 2075). The agency notes that the costs of compliance for 
manufacturers of foods in conventional food form represent less than 1 
percent of sales. The costs of compliance with a 6-month compliance 
period for dietary supplements is approximately 2 percent of sales. 
Therefore, if the agency does not extend the date of application for 
dietary supplement manufacturers, that segment of the food industry 
will be asked to bear higher relative costs than the agency determined 
were reasonable for foods in conventional food form.
    For all these reasons, the agency determines that the 
congressionally mandated date of application will result in an undue 
economic hardship for dietary supplement manufacturers.

B. The Agency's Determination of a Date of Application of Section 
403(q) and (r)(2) of the Act as Applied to Dietary Supplements

    The agency has determined that undue economic hardship will result 
if the dietary supplement industry is required to comply with section 
403(q) and (r) of the act within 6 months. As will be shown in the 
following discussion on the economic impact, a 6-month delay (total of 
12 months to comply) in the application of section 403(q) and (r)(2) to 
dietary supplements would result in over 40 percent savings of 
compliance cost, and a 12-month delay (total of 18 months to comply) 
would result in over 50 percent savings. Given the large disparity in 
costs of compliance for manufacturers of dietary supplements if they 
are required to comply in 6 months, as compared to those that are being 
borne by manufacturers of food in conventional form, FDA finds that it 
should tailor the delay to reduce the costs for dietary supplement 
manufacturers and thus to minimize the disparity. Therefore, the agency 
concludes that it is appropriate to delay the application date for 
dietary supplements for 12 months, as it did for foods in conventional 
food form. Thus, the agency intends to apply section 403(q) and (r)(2) 
to foods labeled after July 1, 1995. The agency fully expects that some 
dietary supplement firms will be able to comply before this date once 
the pressure on printing labels for foods in conventional food form is 
eased after May 8, 1994. Therefore, consumers can expect to begin 
enjoying the health benefits of the label changes prior to July 1, 
1995.

III. Economic Impact

    Some comments agreed with the agency's estimates of the costs of 
relabeling. Many comments were directed at issues covered by the 
advance notice of proposed rulemaking (ANPRM), which addressed the safe 
use of dietary supplements (58 FR 33690, June 18, 1993). Several 
comments stated that the three proposals that the agency issued (there 
was a proposed rule on health claims (58 FR 33700 in addition to the 
proposals on nutrition labeling and nutrient content claims)) and the 
ANPRM should be considered one proposal. These comments stated that the 
economic impact of the four documents would exceed $100 million and 
would be considered a major rule under Executive Order 12291.
    The agency disagrees. Executive Order 12291 did not apply to 
advance notices. Therefore, no analysis of that document was required 
by that Executive Order. (FDA has not taken any action with respect to 
the ANPRM that would make it subject to Executive Order 12866). The 
three proposals are concerned with the labeling of dietary supplements, 
while the ANPRM is concerned with other issues. Thus, the costs and 
benefits associated with regulatory alternatives described in the ANPRM 
can be separated from those resulting from the three proposals on 
labeling actions. The agency has evaluated the labeling actions 
together, however, because it is not possible to separate the impacts 
of the various labeling actions. Finally, FDA is taking no further 
action with respect to the ANPRM at this time.

A. Scope

    1. Several comments objected to the agency's estimate of the number 
of products that will be affected by the nutrition labeling and 
nutrient content claims rulemakings. Two comments stated that there are 
25,000 products that are potentially affected by the rules, rather than 
the agency's estimate of 5,000 products. Another comment stated that 
there are approximately 25,000 herbal products alone that would be 
required to be tested and relabeled. Another comment objected to the 
agency's estimate because the agency failed to include amino acids, 
herbal products, and other dietary supplements that have no 
recognizable food function.
    In its analysis of the proposals, FDA stated that there could be as 
many as 25,000 products that could be considered to be dietary 
supplements. The agency reduced that number to 5,000, an estimate of 
the number of vitamin and mineral supplement products, because: (1) 
Many products that contain herbs or other similar nutritional 
substances would not be subject to the nutrition label requirements 
because they do not contain the nutrients that must be declared, and 
(2) some products marketed as dietary supplements would be unaffected 
by the 1990 amendments because they bear drug claims that make them 
subject to the drug provisions of the act. For these reasons, it is 
clear that not all 25,000 products would be required to be tested or 
relabeled in response to the regulations implementing the 1990 
amendments.
    However, FDA is convinced by the comments that some herbal products 
and other dietary supplements might need to be tested and relabeled as 
a result of these regulations. FDA is unable to determine exactly how 
many of those products would be covered by the food provisions of the 
act rather than by the drug provisions. Therefore, the agency's final 
analysis of the rules is based on a range of products between 5,000 and 
25,000.
    2. Several comments objected to the agency's estimate that 
approximately 150 firms will be affected by the regulations. Some 
comments stated that approximately 500 firms would be affected by the 
proposed rules if made final. Another comment stated that 250 herb 
manufacturers and 150 manufacturers of dietary supplements of vitamins 
and minerals would be affected. Another comment objected to the 
agency's source for the number of firms. The comment explained that 
Dunn and Bradstreet's Electronic Yellow Pages is primarily a listing 
for public companies, and the majority of supplement manufacturers are 
privately-held corporations. The comment suggested that conservative 
estimates suggest that there are a minimum of 150 herb companies alone.
    The agency has confirmed that the Electronic Yellow Pages covers 
both public and private organizations of all types and sizes. The 
agency admits that the Electronic Yellow Pages is not a perfect source 
for the number of firms, but FDA believes that it is not entirely 
inadequate. The major difference between the agency's estimate and 
those of the comments is the inclusion or exclusion of manufacturers 
herbal products and products containing other similar nutritional 
substances. As stated in the response to the previous comment, the 
agency has determined that at least some of these types of dietary 
supplement products may be subject to the nutrition labeling 
provisions. However, because many of these products do not contain 
significant amounts of nutrients, many manufacturers will not be faced 
with the necessity of relabeling their products. For these reasons, the 
agency believes that its estimate of the number of firms may be low, 
but that to include all herbal products manufacturers and manufacturers 
of other similar nutritional substances would inflate the estimate. 
However, the agency has no basis on which to arrive at the actual 
number of firms. Therefore, in its final analysis, the agency is 
estimating the total number of firms affected to be between 150 and 
300.

B. Costs

    3. Several comments disagreed with the agency's estimate of 
administrative costs. The comments stated that actual administrative 
expenses would be at least $1,000 per label. Administrative expenses, 
according to the comments, are associated with the creation or 
redesign, proofreading, legal review, pricing, bid review, and 
retraining of customer service and sales staff. One comment estimates 
that administrative costs to one firm would be 80 to 120 hours of 
executive time, or approximately $2,500 to $3,750.
    FDA recognizes that the factors that determine administrative costs 
are very complicated. The agency's estimates of administrative costs 
are based on a compliance cost model for food labeling created for FDA 
by Research Triangle Institute (RTI) (Ref. 1). According to RTI, many 
firms estimate that administrative effort would be twice as high for a 
6-month compliance period as for a 12-month compliance period. In the 
dietary supplement proposals, FDA estimated that for a 6-month 
compliance period, manufacturers of dietary supplements will incur 
administrative costs of $850 per firm. The range of administrative cost 
estimates submitted in the comments was broad and there were no 
identifiable patterns to the estimates given. Although FDA acknowledges 
that its assumptions may have resulted in underestimates, the comments 
did not provide enough detailed information to permit FDA to evaluate 
the administrative cost estimates that they submitted. Therefore, the 
agency is not altering its original estimates based on these comments.
    The agency has determined that total administrative costs for a 6-
month compliance period are between $130,000 and $250,000, depending on 
the exact number of firms affected by the regulations. As determined by 
the contractor's study (Ref. 1), administrative costs are lower with 
longer compliance periods. A 1-year compliance period results in 
administrative costs of between $65,000 and $125,000. An 18-month 
compliance period results in administrative costs of between $50,000 
and $94,000.
    4. One comment stated that the requirement that herbal dietary 
supplements be required to bear nutrition labeling would mandate that 
all herbal products be assayed for their nutrient content. The comment 
further explained that testing for 12 nutrients would cost $588 per 
product for a total of $15 million for 25,000 products.
    The agency agrees that to the extent that herbal product 
manufacturers will provide nutrition labeling, herbal products will 
need to be assayed for their nutrient content. The agency notes, 
however, that many herbs do not contain significant amounts of the 
nutrients that must be listed in the nutrition label, and that this 
fact is determinable from reference works without testing. Thus, these 
herbs will not need to be tested. Many comments admitted that, in 
general, herbal products do not contain significant amounts of 
nutrients and are not consumed for their nutrient content. However, 
some herbal products and combination products will require nutrient 
testing.
    In the proposals, the agency assumed that dietary supplements of 
vitamins and minerals will not undergo any additional testing as a 
result of the nutrition labeling requirements. Comments did not object 
to this assumption.Therefore, in its final analysis, the agency is 
estimating that as many as 20,000 products may undergo testing once 
every 5 years for a total discounted analytical cost over the next 20 
years of $33 million (7 percent discount rate).
    5. One comment agreed, and several comments disagreed, with the 
agency's estimate of label printing and redesign costs. The comments 
that disagreed stated that printing and redesign costs would be at 
least $800 to $1,200 per label. One comment stated that the cost of 
redesigning and printing each label would be 2 hours of desktop 
redesign, $20 for linotronic service, and $600 for new plates, for a 
total of $750 per label.
    One comment objected to FDA's assumption that label revisions for 
supplements are less comprehensive than revisions for foods in 
conventional food form. The comment states that incorporating the 
``Nutrition Facts'' section plus the ingredient list will necessitate 
complete redistribution of information on many labels.
    In the analysis of the proposed rules, the agency estimated that, 
for a 6-month compliance period, printing and redesign costs would be 
approximately $1,000 per label. The comments do not suggest that the 
agency's estimate is incorrect. Therefore, the agency's final analysis 
of printing costs is based on a per label cost of $1,000 for each of 
between 15,000 and 75,000 labels, or between $15 million and $75 
million. According to the RTI study, the length of the compliance 
period determines a firm's ability to combine planned label changes 
with mandated changes. Therefore, incremental labeling and redesign 
activities are less costly with lengthier compliance periods. If the 
agency extended the compliance period by only 6 months, printing and 
redesign costs would be between $7.5 million and $37.5 million. The 1-
year extension that the agency is providing will reduce printing and 
redesign costs to between $6 million and $28 million.
    6. Several comments provided data on label inventories that would 
be subject to disposal. These comments stated that a 4- to 6-month 
supply of product labels is common, resulting in $3.4 million to $5.1 
million of label inventory that will be discarded. Another comment 
suggested that its dietary supplement label and box inventory disposal 
costs would be $325,000 with a 6-month compliance period, $200,000 with 
a 1-year compliance period, and $50,000 with an 18-month compliance 
period. One comment estimated the cost of discarding noncompliant 
labels would be approximately $30,000 for one firm.
    The estimates provided by the comments are in line with the 
agency's preliminary estimate of label inventory disposal costs. 
Therefore, the agency is not changing its estimate based on the 
comments. The cost of label inventory disposal for a 6-month compliance 
period is between $5 million and $25 million, depending on the number 
of products affected. According to the RTI study and comments, 
lengthier compliance periods allow firms to use up more existing label 
supplies, thus reducing inventory disposal costs. According to data 
submitted in response to the Regulatory Impact Analysis document that 
was published in the Federal Register of November 27, 1991 (56 FR 
60366), and adjusted to reflect the range of products affected, if the 
agency had extended the compliance period for an additional 6 months, 
inventory disposal costs would be between $3 million and $13 million. 
The 18-month compliance period that the agency is providing will result 
in costs of between $2 million and $9 million.
    7. Several comments disagreed with the agency's estimate of the 
cost of inventory disposal. The comments argued that firms would 
dispose of finished product in addition to labels. The comments stated 
that typical product costs for dietary supplements would result in an 
inventory value for the disposal of 5,000 products of between $48 
million and $73 million. One firm estimated its own cost of discarding 
noncompliant inventory would be approximately 30 percent of finished 
goods inventory, or about $45,000.
    Because these proposals cover only the labeling of dietary 
supplements, the agency does not agree that there would be any reason 
for firms to dispose of any product inventory. Nor did the comments 
provide an explanation as to why it would be necessary to do so. 
Moreover, any product packaged and labeled in accordance with law 
before the date that FDA begins to apply the section 403(q) and (r) of 
the act will not need to be relabeled. Therefore, the agency is not 
changing its estimate based on this comment.
    8. Several comments argued that the agency failed to consider the 
cost of discarding and redesigning catalogs, product literature, and 
advertising. The comments suggested that these costs would be at least 
$40,000 per firm, or $20 million for all firms.
    The comments did not provide an explanation as to why it would be 
necessary to discard and redesign catalogs and product literature. The 
agency does agree that, to the extent that these materials are 
labeling, they must comply with the nutrient content and health claims 
provisions of the act.
    However, the agency believes that many of the claims made in these 
types of materials are drug claims or structure-function claims, not 
health claims, and therefore are not subject to these rules. The 
comments did not present evidence to support a different finding. 
Consequently, the agency has no basis on which to conclude that 
extensive catalog and product literature redesign will be required by 
these final rules. Therefore, the agency is not changing its estimate 
based on these comments.
    9. Several comments argued that the agency failed to consider the 
cost of relabeling of product returned from the retailer. The comments 
stated that it is common practice in the supplement industry to accept 
returns from retailers in the event of a label change. Industry firms 
would be faced with a number of products returned from retailers 
unwilling to carry products with older labels. The comments estimated 
the cost of processing returns, disposing of product, and applying for 
full credit at $48 million.
    Any product labeled before the applicability date will not need to 
comply with the new nutrition labeling and nutrient content claim 
provisions. Therefore, no product that is labeled in accordance with 
law before July 1, 1995, need be returned, relabeled, or destroyed as a 
result of these new provisions. However, FDA agrees that to the extent 
that product is returned, the cost of disposing of product returned 
from retailers because of ``old'' labeling should be considered a cost 
of these regulations. However, the agency is unpersuaded of the 
magnitude of the cost and is unsure of the extent to which ``old'' 
product will be returned. The comments provided insufficient 
information with which the agency could estimate these costs. 
Therefore, the agency is not changing its estimates based on this 
comment.
    10. Several comments expressed concern that the rules may cause the 
loss of many thousands of jobs, the closing of many firms, and the loss 
of products from the marketplace. According to one comment, the 
proposed rules would cause the loss of more than $10 million in sales 
and as many as 100 jobs in one company. Another comment stated a belief 
that 2 million Americans will lose their jobs as a result of the 
regulations. The comments did not provide any specific information as 
to how the regulations would cause the loss of jobs and products.
    The agency agrees that the inability to make certain nutrient 
content or health claims may reduce the marketability of certain 
products and perhaps lead to a company's decision to remove a product 
from the marketplace. However, these rules affect only labeling; they 
do not require any supplement to be removed from the market. Moreover, 
the agency does not believe that many products are currently making 
health claims, as distinguished from drug claims or structure-function 
claims. Therefore, the agency has no basis to find that these 
regulations will cause the problems described in these comments. The 
agency believes that there is every reason to expect that the continued 
marketing of the vast majority of dietary supplement products will be 
unaffected by these regulations.
    11. In the analysis of the proposed rules, the agency recognized 
that the rules could have an adverse impact on small businesses. Most 
of the costs associated with labeling regulations are fixed costs, 
which are typically more burdensome for small firms than for large 
firms because of the smaller sales base on which to spread costs.
    One comment stated that the small business exemption was inadequate 
because small firms would not be able to avoid complying with the 
regulations because of competitive pressure. Another comment stated 
that the proposals would be catastrophic to small business owners and 
workers.
    FDA notes that the Nutrition Labeling and Education Act Amendments 
of 1993, which were enacted on August 13, 1993, provide relief for 
small businesses from the requirements of section 403(q) of the act. 
The agency believes that the new exemption for small businesses will 
significantly mitigate any negative impact on small firms.
    12. One comment stated that the proposed rule regarding health 
claims will cause pain, suffering, and death that would not occur were 
labeling and advertising allowed to include health claims. The comment 
was unspecific as to why these results would occur.
    If the absence of health claims causes pain, suffering, or death, 
these regulations provide any party with a vehicle for submitting data 
to support a particular health claim for agency review. Therefore, the 
agency does not agree with this comment.

C. Benefits

    13. One comment stated that the regulations will provide benefits 
by preventing consumers from wasting money on unnecessary and 
ineffective dietary supplements. Another comment stated that if someone 
wanted to waste a little money taking too many vitamins or supplements 
in the hope of avoiding serious illness and the need for harsh drugs, 
they should be allowed to do so.
    Because there are sources other than labeling that provide 
information about the potential uses of dietary supplements, the agency 
believes that limiting the use of claims on labels or labeling will be 
of limited effect in preventing consumers from purchasing supplements 
that they erroneously believe will prevent serious illness. However, 
these regulations will ensure that the labels of dietary supplements 
will provide full nutrition labeling to help consumers to maintain 
healthy dietary practices, and they will help to ensure that any 
nutrient content or health claims made in the labeling of these 
products are scientifically valid, truthful, and not misleading. For 
these reasons, these regulations will provide a significant benefit.
    14. Some comments stated that the cost of providing nutrition 
information on the labels of dietary supplements of herbs would greatly 
outweigh any clear public benefit. The comments explained that herbs do 
not contain significant amounts of the core nutrients and are not 
normally consumed for their nutritional value. Therefore, the value to 
consumers of including nutrition labeling on herb products is 
insignificant.
    The agency agrees with this comment. However, the agency notes that 
those products that do not contain significant amounts of the 14 
mandatory nutrients will generally not be required to bear nutrition 
labeling. Therefore, although there will be no clear public benefit, 
there will also be no cost.

D. Summary of the Economic Impact

    FDA has examined the economic implications of the final rules 
amending on nutrition labeling, nutrient content claims, and health 
claims for dietary supplements as required by Executive Order 12866 and 
the Regulatory Flexibility Act (Pub. L. 96-354). Executive Order 12866 
directs agencies to assess all costs and benefits of available 
regulatory alternatives and, when regulation is necessary, to select 
regulatory approaches that maximize net benefits (including potential 
economic, environmental, public health and safety effects; distributive 
impacts; and equity). The Regulatory Flexibility Act requires analyzing 
options for regulatory relief for small businesses. FDA finds that 
these final rules on dietary supplements, taken together, are not 
significant as defined by Executive Order 12866. In accordance with the 
Regulatory Flexibility Act, the agency certifies that the final rules 
will not have a significant impact on a substantial number of small 
businesses.
    The agency has reviewed the comments and has determined that the 
costs of compliance associated with the 18-month compliance period 
provided by the agency include administrative costs of between $50,000 
and $100,000, analytical costs of between $0 and $33 million, printing 
and redesign costs of between $6 and $28 million, and label inventory 
disposal costs of between $2 and $9 million. Total discounted costs of 
the final regulations, taken together are between $8 and $60 million (7 
percent discount rate). If the agency did not extend the application of 
the rules, total discounted costs would be between $20 and $133 million 
for a 6-month compliance period, or between $11 and $84 million for a 
1-year compliance period.

IV. Environmental Impact

    The agency has determined under 21 CFR 25.24 (a)(11) that this 
action is of a type that does not individually or cumulatively have a 
significant impact on the human environment. Therefore, neither an 
environmental impact statement is required.

V. Reference

    The following reference has been placed on display in the Dockets 
Management Branch (address above) and may be seen by interested persons 
between 9 a.m. and 4 p.m., Monday through Friday.
    1. RTI, ``Compliance Costs of Food Labeling Regulations,'' FDA 
Contract No. 223-87-2097, Project Officer--Richard A. Williams, Jr., 
Research Triangle Park, NC, December 1990.

VI. Conclusion

    For the reasons stated above, FDA hereby establishes July 1, 1995, 
as the date on which it will apply the mandatory nutrition labeling and 
nutrient content claims provisions of the act to dietary supplements.

    Dated: December 23, 1993.
David A. Kessler,
Commissioner of Food and Drugs.
Donna E. Shalala,
Secretary of Health and Human Services.
[FR Doc. 93-31812 Filed 12-29-93; 8:45 am]
BILLING CODE 4160-01-F