[Federal Register Volume 60, Number 165 (Friday, August 25, 1995)]
[Rules and Regulations]
[Pages 44396-44413]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-21233]




[[Page 44395]]

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Part IV





Department of Agriculture





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Food Safety and Inspection Service



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9 CFR Part 381



Use of the Term ``Fresh'' on the Labeling of Raw Poultry Products; 
Final Rule

  Federal Register / Vol. 60, No. 165 / Friday, August 25, 1995 / Rules 
and Regulations   

[[Page 44396]]


DEPARTMENT OF AGRICULTURE

Food Safety and Inspection Service

9 CFR Part 381

[Docket No. 94-022F]
RIN 0583-AB86


Use of the Term ``Fresh'' on the Labeling of Raw Poultry Products

AGENCY: Food Safety and Inspection Service, USDA.

ACTION: Final rule.

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SUMMARY: The Food Safety and Inspection Service (FSIS) is amending the 
Federal poultry products inspection regulations to prohibit the use of 
the term ``fresh'' on the labeling of raw poultry products whose 
internal temperature has ever been below 26 deg. F. This final rule 
requires that raw poultry products whose internal temperature has  ever 
 been  below  26 deg.  F,  but  above 0 deg. F, must be labeled with 
the descriptive term ``hard chilled.'' The word ``previously'' may be 
used with the term ``hard chilled'' on an optional basis. The rule also 
provides for the relabeling of raw poultry products. This action will 
help ensure that raw poultry products distributed to consumers are not 
labeled in a false or misleading manner.

EFFECTIVE DATE: August 26, 1996.

FOR FURTHER INFORMATION CONTACT: Charles R. Edwards, Director, Product 
Assessment Division, Regulatory Programs, Food Safety and Inspection 
Service, U.S. Department of Agriculture, Washington, DC 20250, (202) 
254-2565.

SUPPLEMENTARY INFORMATION:

Background

    The current poultry products inspection regulations prescribe 
freezing procedures for poultry products and the labeling of products 
that are rapidly changed from a non-frozen state to a frozen state. The 
regulations (9 CFR 381.66(f)(2)) state that ``ready-to-cook poultry 
shall be frozen in a manner so as to bring the internal temperature of 
the birds at the center of the package to 0 deg. F or below within 72 
hours from the time of entering the freezer.'' Under the poultry 
products labeling regulations (9 CFR 381.129(b)(3)), poultry that is 
not quick-frozen according to certain permitted procedures may be 
labeled ``frozen'' only if it has undergone prescribed 0 deg. F or 
below freezing procedures.
    On January 11, 1989, FSIS issued Policy Memo No. 022C that allowed 
raw poultry to be labeled as ``fresh'' if its internal temperature is 
above 0 deg. F and below 40 deg. F, and it has not been previously 
frozen at or below 0 deg. F. The policy memorandum states that ``it is 
not practical, under existing marketing strategies and distribution 
patterns, to define `fresh' in terms of internal temperature beyond the 
scope of current regulations, nor is it practical to define consumer 
expectations for poultry products labeled as `fresh.' '' In 
establishing this policy in 1989, FSIS concluded that the consumer is 
the best judge of preference in chilling temperatures for raw poultry 
products labeled as ``fresh,'' and that the marketplace is best suited 
for making these distinctions.
    The State of California enacted a law (Section 26661 of the 
California Food and Agriculture Code) on September 27, 1993, 
restricting the use of the term ``fresh'' on the labels of poultry 
products. Section 26661 prohibited, among other things, poultry 
wholesalers from labeling or otherwise marketing as ``fresh'' any 
poultry product whose internal temperature ever has been equal to or 
below 25 deg. F or that ever has been stored in the aggregate for 24 
hours or more at an average ambient temperature of 25 deg. F or below, 
regardless of the temperature of the product itself. That law was to 
have taken effect January 1, 1994. However, three trade associations 
filed suit in the U.S. District Court for the Eastern District of 
California to prevent enforcement of the California statute, claiming 
that it was preempted by the Poultry Products Inspection Act (PPIA) 
(National Broiler Council, et al. v. Voss (E.D.Cal. Civil No. CV-S-93-
1882 DFL/JFM)). At the request of the Court, USDA filed a brief on 
February 14, 1994, as amicus curiae, on the question of whether the 
California law was preempted by Federal law. In its decision of April 
8, 1994, a U.S. District Judge held that the PPIA preempts state 
labeling requirements that are ``in addition to, or different than'' 
Federal requirements and declared that the labeling provision of the 
California law was preempted by Federal law.1

    \1\ The District Court's Memorandum of Decision and Order as 
well as other documents and pleadings related to the lawsuit are 
available for public inspection under Docket Number 94-022F at the 
office of the FSIS Docket Clerk, Room 4352, South Building, Food 
Safety and Inspection Service, U.S. Department of Agriculture, 
Washington, DC 20250, from 8:30 a.m. to 1:00 p.m., and from 2:00 
p.m. to 4:30 p.m., Monday through Friday.
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    California appealed this decision to the U.S. Court of Appeals for 
the Ninth Circuit, and USDA filed an amicus brief. On June 16, 1994, 
the State of California amended its statute by removing the reference 
to the ``ambient temperature'' of the poultry and prohibiting use of 
the term ``fresh'' on the labeling of any poultry or poultry meat whose 
internal temperature has been below 26 deg. F. On December 14, 1994, 
the Court of Appeals for the Ninth Circuit upheld the District Court's 
judgment that the labeling provision of the California statute was pre-
empted by the PPIA, but ruled that other portions of the amended 
statute, such as those governing the advertising of ``fresh'' poultry, 
could stand.2

    \2\ The Ninth Circuit's ruling is also on file at the office of 
the FSIS Docket Clerk.
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Reassessment of FSIS' Policy on ``Fresh''

    Because of the issues raised by the California law, the Secretary 
of Agriculture on February 10, 1994, directed FSIS to reexamine its 
policy on the use of the term ``fresh'' on the labeling of raw poultry 
products. The Secretary stated that this reexamination of policy was 
necessary to ensure that the policy ``is reasonable and meets today's 
consumer expectations.'' The Secretary directed FSIS to ``make sure 
that any policy change does not open the door to problems like the 
growth of bacteria that could cause foodborne illness.''
    On June 16, 1994, two subcommittees of the U.S. House of 
Representatives Committee on Government Operations held a joint hearing 
on the issue of ``fresh'' labeling of poultry products. Representatives 
from USDA, the poultry industry, and consumer groups presented their 
views on the ``fresh'' labeling issue. Subsequently, on July 27, 1994, 
Senator Barbara Boxer of California, together with Congressman Gary 
Condit of California, introduced H.R. 4839, the Truth in Poultry 
Labeling Act of 1994. This bill would have prohibited use of the term 
``fresh'' on labeling of poultry that has ever been frozen below 
26 deg. F.
    In response to the Secretary's direction and the events described 
above, FSIS initiated the following action. On August 26, 1994, it 
published a notice in the Federal Register (59 FR 44089) announcing 
three public hearings on the use of the term ``fresh'' on the labeling 
of raw poultry products. The hearings were held during September 1994 
in Modesto, CA, Atlanta, GA, and Washington, DC. The hearings focused 
on issues relating to current industry practices and controls and 
consumer expectations and perceptions regarding the term ``fresh'' on 
the labeling of raw poultry products. Also in September 1994, FSIS 
conducted an informal survey of callers 

[[Page 44397]]
to the USDA Meat and Poultry Hotline to determine their attitudes, 
perceptions, and expectations regarding poultry that is to be labeled 
as ``fresh.'' FSIS also reviewed the scientific literature to determine 
and resolve any scientific or technical time- and temperature-related 
issues concerning the safety of poultry products during shipment and 
storage. Transcripts of the public hearings and copies of information 
submitted during the hearings, a copy of the informal survey entitled 
``Consumer Views on Fresh Chicken--Results of a Hotline Survey,'' and a 
copy of the literature review entitled ``Effects of Temperature on the 
Microbiological Profile and Quality Characteristics of Raw Poultry'' 
were made available for review at the office of the FSIS Docket Clerk.
    FSIS also requested USDA's Agricultural Research Service (ARS) to 
conduct research studies on sensory, chemical, and microbial properties 
of raw poultry products that have been exposed to and held at 
temperatures from 0 deg. F to 40 deg. F for different storage periods. 
The ARS report entitled ``Characteristics of Chilled Poultry,'' dated 
December 20, 1994, was subsequently placed on file in the office of the 
FSIS Docket Clerk. The ARS report found that there was no clear-cut 
pattern of change in the sensory characteristics of cooked, deboned 
chicken breasts over the temperature range tested (40 deg. F, 32 deg. 
F, 26 deg. F, 10 deg. F, and 0 deg. F). Slight changes that were noted 
were sample dependent, and it is unlikely that the average consumer 
would detect the differences found by the highly trained taste panel. 
All shear values were in a range that would be translated as 
``tender.'' Near infrared reflectance spectroscopy (NIR) can be used 
for the determination of temperature, drip loss, and to classify 
storage temperature of deboned chicken breasts. However, classification 
of the 26 deg. F storage temperature is not, at present, sufficiently 
accurate to permit NIR to be used as a regulatory enforcement tool to 
detect if a product was chilled to temperatures in the mid 20-
Fahrenheit range. ARS also reported that microorganisms were not killed 
or significantly reduced by exposure to temperatures as low as 0 deg. 
F; however, Salmonella and other enterobacteriaceae do not grow below 
40 deg. F. Spoilage type bacteria can grow at temperatures as low as 
26 deg. F but will not grow at 10 deg. F or 0 deg. F.

The Proposal

    After reviewing the information provided at the public hearings, 
the results of the Meat and Poultry Hotline survey, the literature 
review, the U.S. District Court proceedings in California on ``fresh,'' 
and other information, FSIS issued in the Federal Register on January 
17, 1995 (60 FR 3454), a proposed rule to amend the Federal poultry 
products inspection regulations to establish the conditions that would 
govern the use of the term ``fresh'' on the labeling of raw poultry 
products and the language that would apprise consumers when such 
products do not meet FSIS' proposed criteria for ``fresh.'' FSIS stated 
that the current policy on the use of the term ``fresh'' on the 
labeling of raw poultry products has considerable potential to mislead 
consumers about the products they seek to buy as ``fresh,'' and that 
the potential for economic deception is great when a product offered 
for sale as ``fresh'' is not the product the consumer expects to 
purchase. FSIS also stated that there should be no increased 
microbiological safety risks associated with raw poultry that is 
maintained at 40 deg. F or below.
    FSIS proposed that raw poultry products whose internal temperature 
has ever been below 26 deg. F, but above 0 deg. F, may not bear a label 
declaration of ``fresh'' and must be labeled with the descriptive term 
``previously frozen.'' The term ``previously frozen'' was chosen 
because FSIS believed that this term would be the most readily 
understood by consumers based upon comments from the public hearings. 
FSIS also proposed that raw poultry products whose internal temperature 
has ever been at or below 0 deg. F may not bear a label declaration of 
``fresh'' and must be labeled with either the descriptive term 
``frozen'' or ``previously frozen,'' except when such labeling 
duplicates or conflicts with the products' special handling labeling 
instructions, e.g., ``keep frozen'' or ``shipped/stored and handled 
frozen for your protection,'' as required by 9 CFR 381.125. FSIS stated 
that it would continue to permit use of terms such as ``fresh frozen'' 
and ``frozen fresh,'' as currently provided by 9 CFR 381.129(b)(3), to 
describe products that are frozen rapidly to an internal temperature of 
0 deg. F or below in accordance with the provisions of 9 CFR 
381.66(f)(1).
    FSIS also identified several additional issues regarding the use of 
the term ``fresh'' on the labeling of raw poultry products and 
solicited comments on whether these issues should also be addressed in 
the final rule. While FSIS proposed the use of the descriptive term 
``previously frozen,'' it invited comments on alternate descriptive 
terms. FSIS indicated that it would consider alternate terms if 
information submitted during the comment period demonstrated greater 
consumer understanding and acceptability. In addition, FSIS discussed 
the advantages and disadvantages, which it identified, of the terms 
``previously frozen,'' ``previously held at ______ deg. F,'' ``thawed 
for your convenience,'' ``freshly frozen,'' and ``previously freshly 
frozen.'' FSIS invited comments regarding procedures for monitoring 
compliance with the fresh labeling requirements. FSIS also sought 
comments on its position that the term ``fresh'' can be used in brand 
names, company names, sensory modifiers, etc., on the labeling of raw 
poultry product in a manner that does not cause the purchaser to assume 
the product itself is unprocessed and, consequently, not ``fresh.'' 
FSIS described its labeling policy expressed in Policy Memo No. 022C 
that the term ``fresh'' may not be used on the labeling of any cured, 
canned, hermetically sealed shelf stable, dried, or chemically 
preserved poultry product and invited comments on whether it would be 
useful and desirable to initiate rulemaking to establish regulatory 
requirements for all uses of the term ``fresh'' on the labeling of 
poultry products.

Extension of Comment Period; Solicitation of Comments

    During the comment period on the proposed rule, FSIS received two 
requests from trade associations to extend the comment period in order 
to allow the public time to obtain and review the findings of the ARS 
evaluation on chilled poultry. The ARS report was not available for 
public review in the FSIS Docket Clerk's office at the time the 
proposed rule was published. Previously, FSIS had stated its intention 
to seek comment from the National Advisory Committee on Microbiological 
Criteria for Foods on FSIS' conclusion stated in the preamble to the 
proposed rule that ``there should be no increased microbiological 
safety risks associated with the growth of pathogenic microorganisms'' 
by changing the labeling definition for ``fresh'' poultry. At that 
time, the next meeting of the Committee was scheduled to begin April 
17, 1995. FSIS also received a comment noting the conflict between the 
proposed use of the term ``previously frozen'' and the existing 
regulatory definition of ``frozen.'' In order to allow adequate time 
for public comment on the ARS report, allow the National Advisory 
Committee on Microbiological Criteria for Foods the opportunity to 
comment on FSIS's conclusion that product safety is not an issue should 
FSIS change the 

[[Page 44398]]
definition of ``fresh'' from 0 deg. F to a value less than 28 deg. F, 
and solicit public comments on options for reconciling dual use of the 
term ``frozen,'' FSIS announced in the Federal Register on March 20, 
1995 (60 FR 14668), that it was extending the comment period for an 
additional 60 days until May 19, 1995.
    In the notice of extension of comment period and solicitation of 
comments, FSIS discussed three possible options to resolve the 
inconsistency between the proposed use of the term ``previously 
frozen'' and the preexisting regulatory definition of ``frozen.'' The 
first option on which FSIS solicited comments involved using 
descriptive terms that do not include the word ``frozen'' or the 
unqualified word ``frozen,'' e.g., ``previously semi-frozen,'' ``held 
semi-frozen,'' ``previously partially frozen,'' ``previously chilled to 
a semi-solid state,'' ``shipped/stored/handled semi-frozen (insert 
optional statement, e.g., to preserve quality),'' or ``previously 
frosted.'' The second option was to eliminate the requirement that 
poultry products labeled as ``frozen'' be brought to an internal 
temperature of 0 deg. F or below and to require use of the term 
``frozen'' to identify all poultry products whose internal temperature 
has ever been below 26 deg. F. The third option described would use the 
proposed term ``previously frozen'' on labeling of products with 
internal temperatures between 0 deg. F and 26 deg. F and would create 
an additional qualifier for products with an internal temperature of 
0 deg. F or below, such as ``frozen for long-term preservation,'' in 
order to differentiate between these two types of products.

Discussion of Comments

    FSIS received 26,208 comments in response to the January 17, 1995 
proposed rule and the March 20, 1995 solicitation of comments. The 
comments were from a range of sources as follow: 25,530 from 
individuals; 611 from poultry processors and growers; 23 from trade 
associations; 12 from state government agencies; 6 from academia; 6 
from consumer organizations; 5 from congressional members; 3 from 
chefs; 2 from Federal government agencies; 2 from professional 
associations; 2 from food consultants; 2 from food retailers; and 4 
from other sources. Many of the individual commenters who identified 
themselves as consumers also indicated that they were employed by the 
poultry industry. Some of the comments included issues beyond the scope 
of the proposed rule. For example, some commenters raised questions 
about the difference in meaning of the term ``fresh'' as proposed for 
poultry products and its meaning for red meat and fish products. In 
addition, 7 other comments addressed only issues outside the proposal, 
e.g., water uptake during the chilling process. Since these issues do 
not come within the scope of the proposed regulation, they are not 
addressed in this final rule. FSIS also received 3,990 letters in 
support of the proposal, which carried typed signature blocks but were 
unsigned. A summary of the comments submitted with respect to the 
proposed rule and FSIS' response to the comments follows.

Use of the Term ``Fresh''

    Numerous commenters agreed that the proposed rule is necessary to 
provide consumers with information they need to make informed 
purchasing decisions. Many commenters indicated that they often freeze 
poultry at home for later use and that they want to avoid inadvertently 
refreezing poultry that has been previously frozen and thawed out. Many 
expressed surprise that the practice of marketing thawed poultry 
existed and was allowed under Federal regulations. Some of these 
commenters suggested that a twice-frozen, twice-thawed product might be 
dry and tough, more likely to spoil, or be unsafe. Most supporting 
commenters expressed the opinion that the issue is one of labeling a 
product for what it is, that ``fresh'' is the opposite of ``frozen,'' 
and that, to consumers, ``frozen'' means a product was rock hard or 
previously in that condition. While some of these commenters associated 
the term ``fresh'' with other factors in addition to temperature 
history, such as recent slaughter or age, freedom from bacteria, and 
superior flavor, texture, and juiciness, they insisted that ``fresh'' 
and ``frozen'' are, nonetheless, mutually exclusive.
    In contrast, a large number of commenters who opposed the proposed 
rule contended that it is based on perceptions and that selection of a 
temperature threshold level of 26 deg. F below which a product could 
not be labeled as ``fresh'' was arbitrary and lacked a scientific 
foundation. Large poultry processors stated that they had received no 
or extremely few complaints from consumers that made any reference to 
temperature as it relates to freshness of the product. They interpreted 
the lack of complaints to mean that the ``fresh'' versus ``frozen'' 
issue is a very minor consumer concern. Others commenters suggested 
that consumers have demonstrated their satisfaction with broiler meat 
through an unparalleled increase in per capita consumption in the last 
50 years. Opponents of the proposal further argued that consumers 
demand a product that does not require thawing, but, instead, is ready-
to-cook, and that most consumers know that the colder the temperature, 
the higher the quality of the product. With respect to concerns about 
refreezing thawed poultry, one processor noted that, since this has 
been the general practice for years, there are obviously no problems.
    Many of the commenters who objected to the proposed rule suggested 
that temperature alone is not a reasonable basis for labeling poultry 
products as ``fresh'' because freshness diminishes with time, e.g., a 
product kept at 26 deg. F and held for 3 months is not ``fresh.'' These 
commenters argued that ``fresh'' means ``wholesome'' and that ``fresh'' 
is not the opposite of ``frozen'' because fresh poultry is 
characterized by a variety of factors, including appearance, smell, 
taste, texture, whether the product will spoil relatively quickly, 
among others. Some opponents charged that FSIS attempted to define 
``fresh'' by default, thereby creating a currently non-existent product 
category, which FSIS proposed to call ``previously frozen,'' and which 
was not requested by either consumers or industry. These commenters 
expressed the opinion that consumer expectations do not include 
changing current free enterprise markets by creating non-market-
demanded new product categories that affect both labeling and current 
practices concerning handling statements.

Quality Issues

    A number of the commenters, including chefs, who wrote in support 
of the proposal, stated that frozen poultry can taste good but that 
fresh poultry has a better taste and texture. Many consumers remarked 
that they do not mind paying a premium price for a fresh product, which 
they perceive to be of high quality; however, they do mind paying a 
premium price for a product labeled as ``fresh'' that has been frozen 
for shipment and then thawed for sale. Opponents of the proposal argued 
that there is no clear and easily discernable quality difference 
between products brought to different temperature levels. They pointed 
to the conclusion of the ARS study where an expert taste panel found 
``that there was no clear-cut pattern of change in the sensory 
characteristics over the temperatures tested'' and that ``all shear 
values were in the `tender' range.'' The temperatures tested ranged 
from 0 deg. F to 40 deg. F and included refrozen product. These 
opponents interpreted the ARS results to show that ``fresh'' cannot be 
based on, 

[[Page 44399]]
or solely defined by, a single temperature threshold. In contrast, 
supporters of the proposal suggested that it would be premature to draw 
conclusions about the ARS sensory results without further evaluation 
and peer review of the findings.
    Opponents of the proposal were very concerned that it would 
jeopardize product wholesomeness. They stated that appropriate 
temperature control is a good manufacturing practice designed to 
maximize shelf life and minimize growth of microorganisms to ensure 
consistent high quality and freshness to the consumer. The commenters 
believed that the proposed rule would not provide for an improved 
product, but would cause consumers to purchase a product of lesser 
quality or to pay more for poultry without any change in product 
quality.

Trade Issues

    Numerous opponents, including congressional members, expressed the 
opinion that the proposed rule would inhibit the interstate shipment of 
poultry. Many stated that the ``fresh'' issue is not a consumer issue 
but, rather, a marketing issue in which FSIS should not be involved. 
They believed that the proposed rule would certainly mean higher prices 
for local products through a forced reduction in competition and deny 
free trade in those states enforcing the regulation. On the other hand, 
supporting commenters believed that it is wrong for producers who 
compete against truly fresh products to call frozen and thawed poultry 
``fresh,'' and characterized such a merchandizing practice as 
fraudulent. Several commenters asserted that national processors 
shipping interstate would not be precluded from any markets, and, if 
they wanted to sell fresh poultry, they could do so successfully. One 
commenter noted that most of the perishable food consumed in the U.S. 
is the subject of interstate commerce and that poultry is no more or 
less perishable than many other items in the American market-basket.
    Other opponents argued that the proposed rule was inequitable. For 
example, a trade association contended that the Food and Drug 
Administration (FDA) permits the term ``fresh'' to be used so long as 
``the term does not suggest or imply that the product is unprocessed or 
unpreserved,'' as described in the introductory paragraph to 21 CFR 
101.95. They suggested that poultry products would be ``fresh'' under 
FDA's definition because poultry products kept at temperatures below 
26 deg. F (i.e., 23 deg. F or 24 deg. F) are not preserved because they 
will spoil. Similarly, they questioned why poultry chilled below 
26 deg. F could not be thawed and sold as ``fresh'' when fresh milk has 
been pasteurized, fresh bread has been baked, and fresh crab has been 
cooked and picked.
    Many poultry producers and growers were concerned with the 
potential effect of the proposal on the poultry industry. Some were 
concerned that it could open the door to opportunism by creating an 
adverse relationship between the manufacturer and the customer who 
might claim a product to be ``frozen'' and expect a price adjustment of 
the bill of lading. Others contended that the proposal could adversely 
affect small companies or create loss of sales, shortages of product, 
possible loss of jobs, and decrease the demand for poultry. A number of 
opponents considered the task of monitoring the proposed rule 
throughout distribution channels to be monumental. They stated that 
enforcement would require the expenditure of substantial resources, 
which is not justified because no food safety issue exists.

FSIS Response

    The large volume of comments expressed widely diverse opinions 
about the meaning of the term ``fresh'' as applied to poultry. FSIS 
agrees that there can be numerous perceptions associated with the term 
``fresh,'' including one of higher quality. However, the comments and 
information gathered at the public hearings held last summer on the 
``fresh'' issue show that neither consumers' expectations about fresh 
products nor their willingness to pay more for such products is 
affected by whatever quality differences may exist between poultry 
products subjected to different temperatures.
    FSIS has concluded that the ``fresh'' labeling issue is an 
important consumer protection issue about false and misleading 
labeling. FSIS has the authority to regulate the labeling of poultry 
products based upon the statutory provisions concerning misbranding in 
the PPIA (21 U.S.C. 453(h)(1)) in order to prevent the distribution of 
misbranded products in commerce. Under these statutory provisions, an 
article is misbranded if its labeling is false or misleading in any 
particular. Because the ``fresh'' issue is a labeling issue, it is not 
relevant to this rulemaking whether or not the ``fresh'' issue is also 
a trade or marketing issue as many commenters suggested. Generally, the 
commenters' concerns about loss of trade opportunities and markets 
appear to be driven by factors that relate to how products will have to 
be labeled under the regulations and how FSIS will enforce these 
regulations. FSIS has addressed these concerns in the sections of this 
document that pertain to descriptive labeling and compliance 
procedures.
    After evaluating all of the comments and other data in the 
rulemaking record, FSIS has concluded that consumers equate the term 
``fresh'' with a product that has never been chilled until it is hard-
to-the-touch. Rather than simply refrigerated, consumers consider such 
a hard-to-the-touch product to be frozen. Based on the comments, FSIS 
concludes that use of the term ``fresh'' on the labeling of products 
that have been chilled to the point where they appear to consumers to 
be frozen but are presented for sale in a thawed condition without 
revealing the fact that they had been chilled to a hard-to-the-touch 
state, is misleading. In addition, the available information suggests 
that many consumers want to know the history of the poultry product 
they buy, as related to temperature, so that they can handle the 
product accordingly if they choose to do so, e.g., with respect to 
refreezing. FSIS does not believe that ``frozen'' and ``fresh'' are 
synonymous or that a product which has been chilled until it is hard-
to-the-touch is the same as a product which has not been so chilled. A 
product that has been chilled until it is hard has been processed for 
purposes of preservation regardless of whether or not all of the water 
in the product is in a frozen state.
    FSIS does not agree with the argument that it defined ``fresh'' by 
default and created a new product category. The category of product 
that has been chilled until the product is hard-to-the-touch but not 
frozen to an internal temperature of 0 deg. F or below has been in 
existence for many years, during which time it was often labeled as 
``fresh,'' when, in fact, it was chilled for preservation. FSIS does 
not consider fresh milk, fresh bread, or fresh crab to be analogous to 
fresh poultry because the use of the term ``fresh'' in this context is 
generally not misleading. On the other hand, the comments and other 
information in the rulemaking record show that there is confusion among 
consumers with respect to poultry labeling, and that consumers were not 
aware that poultry products sold as ``fresh,'' and pliable at retail 
display, may have once been hard and then thawed. Moreover, an 
unprocessed, unpreserved form of poultry, which has never been chilled 
to render the product hard-to-the-touch, is available in the 
marketplace.

[[Page 44400]]


Safety Issues

    In its proposed rule, FSIS explained that it does not believe that 
imposing a temperature requirement for use of the term ``fresh'' on the 
labeling of poultry products will increase microbiological safety risks 
as long as the product is held at 40 deg. F or lower. The National 
Advisory Committee on Microbiological Criteria for Foods was asked to 
review and comment on this matter. The Committee discussed the issue 
and concluded that: ``The available scientific data on the microbial 
characteristics of poultry products and growth of bacterial foodborne 
pathogens below 40 deg. F were considered in our evaluation. This 
information leads us to conclude that changing the temperature that 
defines labeling of poultry as `fresh' from 0 deg. F to a value less 
than 28 deg. F should not cause any increased risks to public health. 
This issue is related to labeling and quality rather than 
microbiological safety.'' FSIS agrees with the determination of the 
Committee on this issue.
    Accordingly, for the reasons stated above, FSIS concludes that a 
temperature-related requirement for use of the term ``fresh'' is 
necessary to preclude misleading consumers about the nature of the 
poultry products they purchase.

Temperature Threshold

    The vast majority of the commenters writing in support of the 
proposed rule agreed that the minimum temperature for fresh poultry 
should be set at the proposed temperature of 26 deg. F. Some of these 
commenters expressed the opinion that 26 deg. F is not an arbitrary 
number but a temperature below which poultry is hard-to-the-touch and 
appears frozen to the consumer. Other commenters stated that, since 
most ice crystal formation occurs within a narrow temperature range 
between 27 deg. F and 25 deg. F, it makes sense to use 26 deg. F as the 
dividing line between ``fresh'' and ``frozen'' poultry. A few 
commenters recommended 32 deg. F or 33 deg. F as the cutoff threshold 
because 32 deg. F is the freezing point of water. One commenter 
suggested that any product stored for prolonged periods at or below 
32 deg. F will become hard-to-the-touch and, thus, in the customer's 
view, would be a frozen product.
    Many opponents of the proposed rule argued that there was no 
scientific evidence that poultry products freeze at 26 deg. F. They 
noted that the freezing of food is a process involving a change in the 
product's moisture from a liquid to a solid state over a wide 
temperature range, generally from 28 deg. F to -4 deg. F. Given this 
range, they argued that the selection of a single temperature cannot be 
justified. A few commenters requested additional research to determine 
the freezing point of poultry. Some members of the turkey industry 
argued that the proposal's analysis of the ``fresh'' versus ``frozen'' 
issue focused on chicken. They suggested that more research be 
conducted before the proposal is applied to turkeys, which might 
possibly freeze at a lower temperature. Some commenters suggested that 
an attempt to define complex processes by an oversimplified and 
arbitrary temperature is scientifically unsound and may actually have a 
negative impact on the application of new technologies, improvement of 
product quality, and purchasing options for consumers.

Need for a Lower Temperature

    Numerous commenters from industry called for a lower and more 
reasonable temperature than 26 deg. F as the definition for ``fresh'' 
because colder temperatures provide for a higher quality, better 
tasting, and safer product. Congressional members also noted that there 
are other temperatures below 26 deg. F that preserve the ``fresh'' 
characteristics consumers seek while giving poultry products the longer 
shelf life necessary for transportation over long distances. Many 
poultry processors indicated that the proposed limit would force them 
to process and ship their products at higher temperatures in order to 
ensure that product labeled as ``fresh'' does not fall below 26 deg. F 
in order to avoid costly relabeling procedures. They believed that a 
practice of using higher temperatures would shorten shelf life, 
increase incidence of spoilage, and adversely affect product quality 
and/or safety. Industry also expressed the belief that temperatures 
colder than 26 deg. F provide a safety margin in the distribution 
chain. In addition, commenters argued that a temperature of 26 deg. F 
would create extensive operational problems in order to control 
temperatures, e.g., ensuring that small packages do not go below 
26 deg. F while ensuring that large packages receive adequate 
protection, or achieving a consistent 26 deg. F temperature in very 
thick products like turkey carcasses.
    With respect to lower temperatures, a number of commenters stated 
that existing research shows that growth of psychrophilic bacteria 
normally associated with product spoilage begins to approach a state of 
inactivity at a temperature close to 14 deg. F or 15 deg. F. They 
argued that a temperature of 14 deg. F or 15 deg. F would recognize 
that at least part of the distinction between ``fresh'' and ``frozen'' 
is the difference between continuous bacterial degradation of the 
product and product in which it has been halted. On the other hand, 
some supporters of the proposal challenged this suggestion that the 
point at which spoilage bacteria cease to grow be considered as the 
dividing line between ``fresh'' and ``frozen'' because spoilage 
bacteria do not cause foodborne illness.
    Industry commenters stated that there is no indication that any 
consumer defined ``fresh'' as being tied to 26 deg. F, and that they 
would support 20 deg. F as a practical temperature that would not 
disrupt commercial practices, which have proven themselves over 25 
years of use. One commenter urged FSIS to determine whether there 
exists any distinguishable palpability or quality differential between 
poultry chilled at 20 deg. F and that chilled at 26 deg. F, and, if 
not, requested FSIS to change its temperature standard to 20 deg. F so 
as to impose the least burden on the regulated community. Other 
commenters contended that ``fresh'' could easily be product that is 
22 deg. F or above, as well as the proposed level of 26 deg. F, 
considering that FSIS terminology for ``frozen'' is 0 deg. F. Yet 
others supported a temperature of 23 deg. F, which has been considered 
by some researchers to be the freezing point of poultry. Commenters 
also noted that it has been shown that keeping product as low as even 
24 deg. F will reduce bacterial growth, thus enhancing the quality of 
the product. In addition, a few commenters asked whether the upper end 
temperature limitation of 40 deg. F would be voided should the proposed 
regulation replace Policy Memo No. 022C.

FSIS Response

    FSIS believes there is adequate information on which to limit the 
use of the term ``fresh'' on the labeling of raw poultry products to 
product whose internal temperature has never been below 26 deg. F. The 
effect of various temperatures on the physical and shelf life 
properties of poultry has been studied extensively since the 1920's. 
Many reference books on the preservation of foods by freezing and 
engineering textbooks, such as the 1994 ASHRAE  Handbook on 
Refrigeration, I-P Edition, Chapter 12, Poultry Products, published by 
the American Society of Heating, Refrigerating, and Air-Conditioning 
Engineers, Inc., Atlanta, GA, state that 27 deg. F is the highest 
temperature at which poultry 

[[Page 44401]]
begins to freeze.3 At 27 deg. F, ice crystals begin to form in 
poultry flesh. Below 26 deg. F, poultry products become hard-to-the-
touch because much of the free water is changing to ice. At 25 deg. F, 
the literature suggests that approximately half of the water in the 
poultry is frozen. By 23 deg. F, approximately 80 to 85 percent of the 
free water in the product is frozen, and the product appears to be 
frozen solid. FSIS notes that one commenter stated that it is very 
difficult to insert a temperature probe by hand into a product at 
22 deg. F.

    \3\ A copy of Chapter 12 from the 1994 ASHRAE Handbook is 
available for public inspection in the FSIS Docket Clerk's office.
---------------------------------------------------------------------------

Pliability of Product

    At 26 deg. F, the product is still pliable in that it yields to the 
thumb. This characteristic is described by various commenters on the 
proposed rule and participants at the public hearings and last year's 
court proceedings. A temperature of 26 deg. F as the threshold for 
product to be labeled as ``fresh'' is also supported by the National 
Institute of Standards and Technology (NIST). NIST's Handbook 133, 
``Checking the Contents of Packaged Goods,'' Supplement 3, October 
1992, states in part: ``Fresh Poultry.--For net weight determinations 
only, fresh poultry is defined as poultry above 26 deg. F. This is 
product that yields or gives when pushed with a person's thumb.'' 
4 While NIST defines fresh poultry for the purpose of net weight 
determinations only, FSIS believes that it is pertinent to this issue 
that another Federal agency recognizes that poultry is pliable down to 
a temperature of 26 deg. F. FSIS does not believe that consumers would 
consider a product to be frozen or in some other state as opposed to 
``fresh'' when it is pliable, i.e., when it is not hard-to-the-touch. 
The recognition by NIST that poultry is pliable down to 26 deg. F lends 
further support to the selection of 26 deg. F as the temperature 
threshold for an FSIS labeling definition for ``fresh'' poultry 
products.

    \4\ A copy of the page from the NIST Handbook 133 containing 
this entry is available for public viewing in the FSIS Docket 
Clerk's office.
---------------------------------------------------------------------------

    Based on the scientific evidence that most of the free water in raw 
poultry products freezes over a 4-degree temperature range between 
27 deg. F and 23 deg. F, FSIS believes that the selection of 26 deg. F 
as the lower limit for a product to be called ``fresh'' is reasonable. 
The selection of 26 deg. F is also supported by the comments and other 
information and documents in the rulemaking record, as discussed above. 
A product that has not been held below 26 deg. F should meet consumer 
expectations that ``fresh'' products have not been chilled until they 
are hard. Accordingly, FSIS is adopting 26 deg. F as the temperature at 
or above which a poultry product must have been continually held in 
order to be labeled as ``fresh.'' FSIS does not believe that it is 
necessary to incorporate an upper limit of 40 deg. F into the labeling 
provision because the 40 deg. F internal temperature pertains to 
chilling and holding requirements as described in 9 CFR 318.66 (b), 
(c), and (d).

Product Coverage

    With respect to comments that turkey should not be covered by this 
final rule because it might have a different freezing point than 
chicken, FSIS disagrees that turkey should be exempted while more 
research is conducted to determine its freezing point. There is an 
abundance of information on the freezing of turkey products--from 
reference books on the freezing preservation of foods and engineering 
textbooks, including the 1994 ASHRAE Handbook on Refrigeration--which 
shows that turkey freezes over the same temperature range as chicken. 
In addition, references to scientific studies on the freezing of turkey 
are cited in FSIS' literature review entitled ``Effects of Temperature 
on the Microbiological Profile and Quality Characteristics of Raw 
Poultry,'' which was discussed in its proposed rule, and in the paper 
entitled ``Superchilling of Poultry Meat'' by W. J. Stadelman.5

    \5\ These documents are available for public inspection in the 
office of the FSIS Docket Clerk.
---------------------------------------------------------------------------

    In FSIS' view, the various studies do not show significant 
differences between turkey and chicken with respect to the effects of 
freezing on the products. FSIS notes that the ASHRAE Handbook  on  
Refrigeration  refers  to 27 deg. F as the point at which poultry 
starts to freeze. This temperature is not restricted to chicken but, 
rather, refers to all poultry, including turkey. Moreover, FSIS has not 
been presented with any evidence from the public hearings, the U.S. 
District Court proceedings, or comments on its proposed rule that 
suggests the effect of various temperatures on the physical and shelf 
life properties of turkey differs from chicken to an extent sufficient 
to warrant a temperature threshold other than 26 deg. F as an 
appropriate threshold for the labeling of ``fresh'' turkey. With 
respect to pliability, FSIS notes that the NIST Handbook 133 refers to 
``fresh poultry,'' rather than specifically to ``fresh chicken,'' when 
defining poultry products for the purpose of net weight determinations 
as those that are pliable down to 26 deg. F. Therefore, for these 
reasons, FSIS will not exempt turkey from the requirements of this 
final rule.

Descriptive Labeling

    Those commenters who favored regulating use of the term ``fresh'' 
on the labeling of poultry products generally supported requiring use 
of a descriptive term on the labeling of products whose internal 
temperature has ever been below the 26 deg. F minimum temperature 
defining ``fresh.'' These commenters also contended that if the 
labeling says nothing, many consumers will likely assume product in a 
retail case is ``fresh,'' i.e., has never been frozen, because it is 
soft-to-the-touch. They argued that consumers should not be subjected 
to either the affirmative, deceptive verbal representation that a 
product is ``fresh'' when it has been frozen or the deception implied 
by the unfrozen condition of a product presented for retail sale that 
it is ``fresh'' when, in fact, it has been frozen and thawed.
    In contrast, many poultry processors and trade associations 
asserted that industry should not be required to use any descriptive 
term for product that is not declared to be either ``fresh'' or 
``frozen.'' These commenters believed that a regulation governing the 
use of the term ``fresh'' should be handled in the same manner as other 
affirmative marketing claims such as nutrient content claims. 
Specifically, they suggested that FSIS should establish the criteria 
for the use of the term and allow all manufacturers the option to make 
the claim or not as they see fit. At the minimum, the commenters stated 
that descriptive labeling for product between 0 deg. F and 26 deg. F 
should be optional.
The Term ``Previously Frozen''

    A large majority of commenters who supported use of descriptive 
labeling to describe the nature of the product favored the term 
``previously frozen,'' which FSIS proposed to require. They expressed 
the opinion that the simple phrase ``previously frozen'' was adequate 
because, in general, consumers only want to distinguish between fresh 
and thawed poultry. A trade association submitted results of a national 
telephone survey of consumers, conducted in November 1994, which 
consisted of a minimum of 1,000 interviews. Results showed that 87 
percent of those interviewed said they want a properly descriptive 
label on poultry that was frozen and then thawed. When the respondents 
who wanted a descriptive label were asked to rate seven terms on the 
basis of accuracy to describe such product, the 

[[Page 44402]]
percentages of those surveyed rating the terms as ``most accurate'' 
were as follows: 49.7 percent for ``do not refreeze''; 48.4 percent for 
``previously frozen''; 35.5 percent for ``previously frozen for your 
convenience''; 26.9 percent for ``thawed''; 21.6 percent for 
``previously thawed for your convenience''; 18.3 percent for ``fresh''; 
and 10.2 percent for ``chill-pack.'' The commenter interpreted these 
results as showing that ``previously frozen'' was a preferred choice 
for a descriptive label.
    Without exception, opponents of the proposed rule voiced strong 
objection to use of the proposed term ``previously frozen'' on the 
labeling of poultry products brought to temperatures between 0 deg. F 
and 26 deg. F. They stated that products that have experienced 
temperatures below 26 deg. F cannot be characterized accurately as 
``previously frozen.'' These commenters noted that the proposal was 
internally inconsistent because it would require products to be 
identified as ``previously frozen'' when they could never be labeled 
legally as ``frozen'' based on FSIS' regulations (9 CFR 381.66(f)(2)), 
which provide that poultry may only be labeled as ``frozen'' if it 
reaches a temperature of 0 deg. F or below. They argued that, because 
the shelf life of raw poultry products held below 26 deg. F is not the 
same as for those held at 0 deg. F or below, the labeling would be very 
misleading and confusing to the consuming public who have an 
expectation that frozen product should not spoil and has a long shelf 
life. These commenters also argued that requiring use of the term 
``previously frozen'' would be confusing to facets of the industry 
because they would handle product labeled as ``previously frozen'' in 
the same manner as they would handle fresh frozen or frozen product, 
thereby resulting in increased product mishandling.
    Additionally, numerous opponents of the term ``previously frozen'' 
considered it to be a negative or punitive description that connotates 
undesirable handling and implies that the products are inferior, 
although they consider the products to be superior from a shelf life 
and microbiology standpoint. They expressed concern that the proposed 
labeling would make it harder to market poultry because consumers would 
not want to buy a previously frozen product. These commenters contended 
that the proposal establishes a double standard which could cause 
consumers to discriminate against certain products. For example, the 
proposal would require that product reaching temperatures below 26 deg. 
F be labeled as ``previously frozen,'' while products that are frozen 
rapidly (within 48 hours after initial chilling) may be labeled as 
``fresh frozen'' or ``frozen fresh,'' in accordance with 9 CFR 
381.66(f)(1). In their opinion, use of ``previously frozen'' on 
labeling suggests the product is not ``fresh'' when, in all likelihood, 
it could be fresher than a fresh frozen product.
    Some supporters of the term ``previously frozen'' did not agree 
that the term might be confusing. They stated that the designation of 
``frozen'' for poultry below 0 deg. F is not in conflict with the 
designation of ``previously frozen'' for product in the temperature 
range between 0 deg. F and 26 deg. F because the latter is a labeling 
designation that accurately reflects consumers' perceptions that hard-
to-the-touch poultry is frozen poultry. They noted that the freezing 
regulations describe a process for handling poultry products that 
allows them to remain in good condition for an extended period of time. 
They suggested that labeling thawed poultry as ``previously frozen'' 
would not impede or contradict that important processing requirement, 
but would alert consumers that the poultry they are buying was once in 
a short-term frozen state and should not be refrozen at home.
    Because the regulatory definition of ``frozen'' describes a 
condition of the product which makes it suitable for long-term storage 
and subsequent use and/or for consumer education purposes, some 
commenters who favored use of the term ``previously frozen'' suggested 
that the term could be clarified in the regulations to alleviate any 
possible confusion. For example, one commenter suggested that the term 
``previously frozen'' be defined as ``defrosted or thawed raw poultry 
products which have been chilled (internal temperature has ever been 
below 26 deg. F) or frozen (internal temperature of 0 deg. F or 
below).'' Similarly, another commenter suggested that terms could be 
numerically defined in the regulations such as ``frozen (0 deg. F or 
below)''; ``previously frozen (1 deg. F to 25 deg. F)''; and ``fresh 
(26 deg. F to 40 deg. F).''

Alternate Terms

    FSIS reviewed numerous comments on the four possible alternate 
terms discussed in the proposed rule, i.e., ``previously held at 
______ deg. F,'' ``thawed for your convenience,'' ``freshly frozen,'' 
and ``previously freshly frozen.'' FSIS also received numerous comments 
on the use of a phrase which either does not include the word 
``frozen'' or does not include the unqualified word ``frozen,'' as 
discussed in the notice soliciting comments to reconcile dual use of 
the word ``frozen.'' Some commenters stated that all the terms convey 
basically the same information and clearly alert the consumer that the 
product has not been kept at fresh temperatures. These commenters 
argued that individual processors should be permitted to select from a 
group of terms that accurately depict the product in order to 
accommodate different marketing approaches. A number of commenters who 
supported descriptive labeling recognized the difficulty of identifying 
the best terminology.
    A few supporters disliked the phrase ``previously held at 
______ deg. F'' on the basis that it might not give consumers the 
information they need because many might not know that poultry freezes 
below 26 deg. F. A commenter also stated that this particular phrase, 
if used, should specify a time period in days or weeks, i.e., 
``previously held at ______ deg. F for less than (insert time 
period).''
    Some supporters of descriptive labeling opposed the term ``thawed 
for your convenience'' on the basis that the product is frozen for the 
convenience of the producer and/or retailer rather than the consumer, 
or that it is an unnecessarily confusing way of saying ``previously 
frozen.'' Similarly, some commenters opposed use of the phrase 
``previously frozen for your protection'' on the basis that freezing 
does not make the product safer but, rather, extends its shelf life. 
Other commenters preferred the phrase ``previously frozen and thawed 
for your convenience,'' while yet others preferred the simple word 
``thawed.'' To avoid confusion over dual use of the word ``frozen,'' a 
consumer organization also suggested ``thawed,'' but was concerned that 
some consumers might not understand that the product had been held in a 
frozen state.
    Concerning terms using the word ``freshly,'' some supporters 
contended that ``freshly frozen'' implies that the poultry is still in 
the frozen state, which would not likely be the case, and that it might 
be confused with the term ``fresh frozen,'' which is used for certain 
poultry frozen to 0 deg. F or below. Others expressed opposition to any 
language that permits manufacturers to market a product as ``freshly 
frozen'' or ``previously freshly frozen'' on the basis that ``fresh'' 
and ``frozen'' are diametrically opposed terms. Some commenters 
considered the phrase ``previously freshly frozen'' to be little 
different than ``previously frozen,'' except that it adds an 
unnecessary word. Generally, commenters indicated that terms that 
avoided the word ``frozen,'' e.g., ``previously chilled to a semi-solid 
state,'' or that avoided the unqualified word ``frozen,'' e.g., 
``previously semi-frozen,'' were 

[[Page 44403]]
awkward and would be disregarded by consumers.
    Industry commenters and trade associations who objected to the term 
``previously frozen'' also objected to the alternative terms discussed 
in the proposed rule and the notice. They stated that all the 
alternatives, like ``previously frozen,'' are based on the dichotomy 
that if a product is not fresh, it must be frozen. The commenters 
argued further that requiring wholesome product to be labeled with 
terms such as ``previously partially frozen'' and ``previously chilled 
to a semi-solid state,'' which FSIS acknowledged will be viewed 
negatively by consumers, is unprecedented and wholly unnecessary. They 
alleged that such terms are awkward, unclear, impractical or 
inaccurate.
    In its notice seeking further comments to reconcile the existing 
definition of ``frozen'' and the proposed use of the term ``previously 
frozen'' (60 FR 14668), FSIS discussed an option to eliminate the 
current requirement that poultry products labeled as ``frozen'' must be 
brought to an internal temperature of 0 deg. F or below and to require 
use of the term ``frozen'' to identify all products whose internal 
temperature has ever been below 26 deg. F. This option found no support 
among commenters whether or not they supported or opposed the intent of 
the proposal. Commenters stated that, not only would the option require 
more work for the industry and local governments, it would simply shift 
the confusion from ``fresh'' to those who understand and rely on the 
meaning of ``frozen.'' Some noted that the temperature range from above 
0 deg. F to 26 deg. F is not ideal for freezing poultry for storage and 
suggested that time limits should be set on this type of storage.
    In the same notice, FSIS also discussed an option to create an 
additional qualifier for products frozen to 0 deg. F or below, 
specifically, ``frozen for long-term preservation,'' to distinguish 
them from chill pack products whose temperatures are often between 
20 deg. F and 26 deg. F. This option also found virtually no support 
among any of the commenters. They stated that the phrases ``frozen for 
long-term preservation'' or, similarly, ``frozen for long-term 
storage'' imply a difference between the current labeling for 
``frozen'' and proposed labeling for ``long term'' when there is no 
difference. Others saw no need for ``frozen for long-term . . .'' and 
did not understand what additional benefit to the consumer this term 
could provide compared to the current labeling requirement of ``keep 
frozen.'' As with the preceding options, the commenters contended that 
requiring such terms only serves to create confusion for existing 
products and implies the existence of a new product when there has been 
no change in product quality and safety.

Other Suggested Terms

    Some supporting commenters offered other terms to reconcile the 
definitions of ``frozen'' and the proposed term ``previously frozen.'' 
Those who found ``previously frozen'' to be confusing suggested that 
``defrosted for your convenience'' and ``defrosted'' would be 
acceptable because, like ``thawed for your convenience'' and 
``thawed,'' they have been used on seafood and accepted by grocery 
store customers. A trade association suggested that use of the term 
``fresh, previously frozen'' would sufficiently harmonize the labeling 
of the products. Poultry processors and other trade associations 
believed that manufacturers should be able to use any number of 
optional, meaningful terms such as ``chilled,'' ``very chilled,'' 
``iced,'' or ``frosted,'' which, they suggested, meet the physical 
characteristics of poultry in the semi-frozen state that the consumer 
could understand. A number of these commenters suggested ``deep 
chilled'' or a similar term to suggest to the consumer more than 
adequate chilling analogous to ``deep frozen'' as a method of freezing 
that was more than adequate. Likewise, a number of these commenters 
stated that ``hard chilled'' would be an appropriate designation 
analogous to ``hard frozen.'' In support of such terminology, a poultry 
farmer submitted a copy of descriptive terms from a 1937 publication, 
Marketing Poultry Products, 3rd. ed., E. Benjamin and H. Pierce, John 
Wiley & Sons, Inc., New York.6 The commenter suggested that what 
we do today has already been done and the terms and accepted practices 
now under discussion were standard in the past. The chilling 
descriptions from the publication are: Fresh, dressed--poultry that is 
cooled but has not been hard chilled or frozen; fresh, hard chilled--
fresh, dressed poultry that has been frozen only hard enough to allow 
it to be carried in good condition to market; and frozen--poultry that 
has been frozen solid.

    \6\ A copy of the page from the publication containing the 
descriptive terms is available for review in the office of the FSIS 
Docket Clerk.
---------------------------------------------------------------------------

FSIS Response

    After carefully considering the many comments on the proposed 
requirement that poultry products whose temperature has ever been below 
26 deg. F, but above 0 deg. F, be labeled with a descriptive term, FSIS 
continues to believe that such a requirement is necessary to prevent 
consumers from being misled about the nature of the products they 
purchase. Without such labeling, there is no way for a consumer to know 
that a product was at some time in a hard condition because once that 
product has been thawed for presentation in the fresh retail case it 
may be commingled with product that has never been below 26 deg. F, 
which may or may not bear a designation of ``fresh.'' As stated 
previously, FSIS believes that consumers do not equate poultry products 
that have been chilled to the point where they are hard-to-the-touch 
with fresh poultry products. Therefore, to present such chilled 
products to consumers in a thawed state, without alerting them to the 
fact that the product was at some time in a partly frozen state, 
misleads those consumers into assuming that the product was always in 
an unfrozen condition and is a fresh product.
    However, after thorough consideration of the volume of comments 
that expressed concerns with the negative aspects of the proposed term 
``previously frozen'' and concerns about confusing consumers into 
assuming that chill pack products are identical to deep frozen 
products, i.e., products frozen to internal temperatures of 0 deg. F or 
below, with which they are long familiar, as well as other information 
in the rulemaking record, FSIS has decided not to use the proposed 
descriptive term ``previously frozen.'' FSIS has been persuaded that 
the proposed term ``previously frozen'' is not the most appropriate 
term to convey the accurate message about the chill pack products to 
consumers considering the different qualities that partially and 
completely frozen products possess across the freezing range. FSIS 
recognizes that consumers might confuse chill pack products with deep 
frozen products, i.e., those whose internal temperature has been 
brought to 0 deg. F or below, and vice versa, under the proposed 
labeling scheme. Instead, FSIS will require that poultry product whose 
internal temperature has ever been below 26 deg. F, but above 0 deg. F, 
be labeled with the descriptive term ``hard chilled.''
    Based on information provided in the comments on the proposed rule, 
the public hearings, the U.S. District Court proceedings, and other 
information in the rulemaking record, FSIS has concluded that there are 
differences in poultry products at different internal temperatures. The 
chill pack products that are brought to the lower 20-degree Fahrenheit 
range will spoil in a matter 

[[Page 44404]]
of weeks. A product chilled to 14 deg. F to 15 deg. F, where most of 
the free water is in a frozen state and where bacterial growth has 
stopped, will develop off-flavors due to chemical oxidation after 
several months. A product frozen to 0 deg. F or below, where almost all 
of the free water is in a frozen state, has an expected shelf life of a 
year or more depending on packaging and storage temperature. Thus, 
while products with internal temperatures in the lower 20-degree 
Fahrenheit range and those at about 15 deg. F and at 0 deg. F or below 
have the same hard physical appearance, they do not have the same 
attributes in terms of stability for preservation. According to the 
available information, some poultry processors bring certain products 
to internal temperatures in the range of 15 deg. F to 20 deg. F, but 
most do not take product below 20 deg. F due to the cost of 
refrigeration, unless they take the product to 0 deg. F or below for 
long-term preservation.
    The objective of the labeling requirements adopted in this final 
rule is to apprise consumers whether certain poultry products may have 
been partly frozen to a hard-to-the-touch state at some time. FSIS 
believes that such descriptive labeling should not conflict with the 
long-established regulatory definition for ``frozen,'' nor should it 
disparage the high quality, wholesome products that consumers have been 
purchasing for many years. Having clearly stated the objective of the 
descriptive labeling and qualifying conditions, FSIS could choose not 
to require use of any one specific term or terms on an industry-wide 
basis. Rather, FSIS could require that individual processors select 
terms or phrases that meet the objective of descriptive labeling. 
However, the disadvantage of this approach is that not all potential 
terms convey the message equally well. Use of multiple terms to 
communicate an identical message could be a source of confusion for 
consumers. FSIS believes that consumers would be better served by use 
of a single term that promotes name recognition of the type of chilling 
process to which the bulk of the products in question have been 
subjected and their resulting physical condition.
Assessment of Terms

    FSIS has reviewed and considered the comments regarding the various 
descriptive terms to determine how well each conveys the fact that 
products had at one time been brought to a very hard physical state. 
FSIS believes that the terms containing the word ``frozen'' pose 
potential conflicts with the regulatory definition of ``frozen'' and 
may well imply that products are of a lesser quality or that they had 
been in a frozen condition for some length of time, e.g., months, after 
slaughter. In fact, poultry products are typically of high quality and 
recently slaughtered, e.g., usually within one or two weeks, when 
presented for sale. Similarly, phrases that use terms like ``semi-
frozen,'' ``semi-solid,'' and ``partially frozen'' may be awkward and 
confusing to consumers and may also imply that the products have been 
mishandled or are inferior. FSIS considers the terms ``chilled,'' 
``very chilled,'' ``chilled pack,'' ``iced,'' and ``frosted'' to convey 
only ordinary refrigeration, packaging in ice above 26 deg. F, or an 
ice crust on the surface. The phrase ``previously held at ______ deg. 
F'' might convey a hard condition because most consumers know that 
water freezes at 32 deg. F and would assume temperatures in the lower 
20-degree Fahrenheit range are freezing temperatures for foods; 
however, consumers might also assume the products are frozen solid. The 
terms ``thawed'' and ``defrosted'' are also commonly understood words 
that convey the message that products were frozen, but FSIS believes 
that these terms also pose potential conflicts with the Agency's 
existing definition of ``frozen.''

The Term ``Hard Chilled''

    FSIS carefully considered the term ``deep chilled'' because it 
might convey the notion of exceptional coldness extending to the 
interior of the product or excessive coldness such as is suggested by 
terms like ``deep frozen'' or ``deep freeze.'' In addition, according 
to some commenters, the term ``deep chilled'' is one often used by 
processors as a trade term to describe poultry that is processed by the 
chill pack cooling system. FSIS believes that one of the central issues 
in this rulemaking is selection of a descriptive term that will convey 
that the subject products had at one time been brought to a very hard 
physical state, which consumers equate with products that are frozen. 
FSIS does not believe that the term ``deep chilled'' adequately conveys 
such information. FSIS does believe, however, that the term ``hard 
chilled'' is a reasonably precise and understandable term that conveys 
accurate information about both the physical condition of a product and 
the chilling process to which it has been subjected. Thus, FSIS has 
concluded that the term ``hard chilled'' is superior to ``deep 
chilled,'' and will achieve the objective of accurate, descriptive 
labeling for use by consumers and industry. FSIS has also determined 
that the term ``hard chilled'' will promote name recognition of the 
type of chilling process to which the bulk of the products in question 
have been subjected and their resulting physical condition.
    While FSIS will not require qualification of the term ``hard 
chilled'' with the word ``previously'' on the labeling of poultry 
products whose internal temperature has ever been between 0 deg. F and 
26 deg. F when that product reaches an internal temperature of 26 deg. 
F or above prior to sale or during display for sale, this labeling 
option will be permitted under this final rule. A commenter, who 
identified himself as a meat cutter for a grocery chain, informed FSIS 
that, in the commenter's particular situation, the retail walk-in box 
is maintained typically at about 32 deg. F, while the retail fresh meat 
case is maintained at about 35 deg. F. These approximate temperatures 
for retail situations are substantiated by information provided by 
other commenters and by participants at the public hearings. Because 
the temperatures of the retail cases are above 27 deg. F, which, as 
FSIS has previously discussed, is the point at which poultry begins to 
freeze, FSIS has concluded that most poultry offered for sale in a 
retail setting will be pliable to the touch.
    FSIS does not believe that consumers would be confused by a product 
labeled as ``hard chilled'' that is no longer hard-to-the-touch. The 
term ``hard chilled'' simply conveys that the product has been 
subjected to a cooling process that lowered its temperature below 
26 deg. F and became hard-to-the-touch. The term ``hard chilled'' could 
imply that poultry is still in a hard state, even though the product 
may no longer be hard when it is offered for sale in a retail setting. 
Because FSIS does not believe that consumers would be confused by a 
product labeled as ``hard chilled'' that is no longer hard-to-the-
touch, this final rule does not make a regulatory distinction between 
the terms ``hard chilled'' and ``previously hard chilled'' because both 
terms describe the cooling process to which the product was subjected. 
Therefore, FSIS is providing in this final rule that the word 
``previously'' may be used on poultry labeling contiguous to the term 
``hard chilled'' on an optional basis. This added flexibility allows 
processors and retailers the option to select either ``hard chilled'' 
or ``previously hard chilled.''
    Based on all the considerations set forth in the preceding 
discussion, FSIS is revising its proposed provision at 9 CFR 
381.129(b)(6)(i). FSIS is providing in this final rule that raw poultry 
product whose internal temperature has 

[[Page 44405]]
ever been below 26 deg. F, but above 0 deg. F, must be labeled with the 
descriptive term ``hard chilled'' or in order to inform consumers and 
other end users that the product was subjected to a chilling process 
sufficient to render the product hard-to-the-touch. This final rule 
also provides for use of the word ``previously'' with the term ``hard 
chilled'' on an optional basis.

Products Frozen to 0 deg. F

    FSIS does not believe that requiring descriptive labeling in the 
form of ``hard chilled'' on poultry products whose temperature has ever 
been below 26 deg. F, but above 0 deg. F, conflicts with the long-
established regulatory definition of ``frozen.'' Therefore, FSIS has 
decided that it is not necessary to require an additional qualifier, 
e.g., ``frozen for long-term preservation,'' for products frozen to 
0 deg. F or below. FSIS also agrees with commenters that an additional 
qualifier on products frozen to 0 deg. F might confuse consumers about 
the existing products and lead them to believe they are in some way 
different when, in fact, they are not. In addition, FSIS no longer 
believes that it is necessary to require use of the term ``previously 
frozen'' for the same reasons discussed above with respect to use of 
the word ``previously'' in conjunction with the term ``hard chilled.'' 
However, FSIS will allow the use of the word ``previously'' with the 
term ``frozen'' on an optional basis. Accordingly, FSIS is revising the 
requirement in its proposal by adding a provision that the word 
``previously'' may be used contiguous to the term ``frozen'' on an 
optional basis, and is adopting the requirement that raw poultry 
product whose internal temperature has ever been at or below 0 deg. F 
must be labeled with the descriptive term ``frozen,'' except when such 
labeling duplicates or conflicts with special handling labeling 
requirements in 9 CFR 381.125.
    The requirement to identify that the product is or was ``frozen'' 
is not negated under any circumstance. Even if the product is frozen to 
an internal temperature at or below 0 deg. F and thawed by the 
processor before distribution, the fact that the product was frozen at 
one time must be revealed by use of the descriptive term ``frozen'' or 
by appropriate handling statements prescribed in 9 CFR 381.125. The 
term ``frozen'' may always be qualified with appropriate statements, 
e.g., ``frozen, thawed for your convenience,'' at the manufacturer's 
discretion, when frozen product is destined to be thawed prior to sale 
or during display for sale. However, the product may not be labeled 
solely with a handling statement of ``keep refrigerated,'' which would 
not suffice to reveal that the product was once frozen to a temperature 
at or below 0 deg. F.

Optional Statements

    With respect to optional statements used in conjunction with 
descriptive labeling, FSIS will continue to allow the use of phrases 
such as ``for your convenience'' or ``to preserve quality.''

Compliance Procedures

    In the proposed rule, FSIS stated its belief that processors, 
transporters, wholesalers, and retailers would establish appropriate 
controls to ensure that their poultry products comply with FSIS' 
proposed labeling requirements in designing and following good 
manufacturing practices. Therefore, FSIS did not believe that it was 
necessary to propose detailed procedures to be followed by the Agency 
in monitoring compliance with the rule governing the use of the term 
``fresh'' on raw poultry products. FSIS did, however, invite comments 
regarding such procedures.
    Many commenters sought clarification about the procedures for 
measuring compliance with ``fresh'' labeling requirements. Others 
requested that specific conditions be incorporated into FSIS compliance 
instructions. A number of commenters from industry stated that 
flexibility needs to be provided in enforcement because of the inherent 
practical problems in maintaining product temperature adequate to 
ensure its quality. These commenters cited situations where variations 
in equipment, product, and other factors might cause products 
unavoidably to fall below 26 deg. F, including the following: (a) 
typical commercial and retail refrigeration units experience operating 
variances of 2 deg. F and 4 deg. F, respectively; (b) refrigerated 
trailers experience fluctuations from 3 deg. F to 10 deg. F from front-
to-back and/or top-to-bottom; (c) brief mechanical stops and product 
spills in a blast chiller can result in product temperatures below 
26 deg. F even if the blast is set correctly; (d) temperature variances 
occur during chilling operations and storage between large and small 
products due to density, e.g., breasts versus wings or whole birds 
versus small trays; (e) physical position in a refrigeration unit 
causes temperature variation, e.g., product closest to the air 
circulation fans will be measurably colder than product in the middle 
or on the far side of a pallet; and (f) variation in product 
temperature occurs during storage due to insertion of product with 
higher or lower temperature than ambient cooler temperature, relative 
humidity, or the act of opening and closing a cooler or truck 
compartment to gain access to product. Many commenters also contended 
that typical thermometers are only accurate to 2 deg. F.
    A trade association, which supported the proposal, countered the 
arguments that there are difficulties in maintaining a steady 
temperature in refrigerated trucks. The commenter expressed the opinion 
that, if poultry is loaded into the cargo cooler at 26 deg. F, air 
temperature inside the cooler would have to be kept much lower than 
26 deg. F for a very long period of time for it to have an effect on 
the internal temperature of the poultry itself. The commenter further 
contended that it is not difficult to maintain a steady temperature in 
a refrigerated truck because thermostats can control temperatures 
within a range of 1.5 to 2 degrees.

Temperature Tolerances

    Numerous commenters called for a temperature tolerance, noting that 
FSIS has established tolerances in other areas such as net weight 
determinations. They argued that a tolerance should reflect recognition 
of the physical realities and limitations of product processing and 
distribution and represent good manufacturing practices. Some poultry 
processors suggested that they be permitted to target a 2 deg. F 
window, i.e., a temperature range of 24 deg. F to 26 deg. F, as opposed 
to a single temperature of 26 deg. F. Many suggested that product 
temperature be regulated to allow a 3 deg. F variance on any given 
check unless there is a consistent pattern of abuse. Other commenters 
asserted that it would be reasonable to accept a cumulative effective 
variance of 4 deg. F assuming the more salient variances to be 
represented by commercial refrigeration units and temperature measuring 
devices. Still other processors stated that, since neither food safety 
nor product quality is at risk, a tolerance of 5 deg. F would be 
practical in commercial operations as long as it can be proven that the 
raw poultry did reach its optimum temperature for its state, e.g., a 
fresh condition, before being shipped. In addition, a trade association 
suggested that the regulatory option which FSIS discussed in the 
preamble to its proposed rule be used as an alternative compliance 
system, i.e., a two-step process control system in which temperatures 
between 23 deg. F and 26 deg. F would be attributed to normal effective 
variances in refrigeration units and temperature measuring devices; 
temperatures between 20 deg. F and 23 deg. F would require process 
control 

[[Page 44406]]
adjustments; and temperatures below 20 deg. F would require product 
relabeling. The commenters further suggested that the first step be set 
at 22 deg. F in recognition of the 4 deg. F cumulative effective 
variance mentioned previously.
    Commenters supporting the proposed rule were divided as to whether 
FSIS should modify compliance procedures to provide for a temperature 
tolerance. Some of these commenters contended that FSIS should provide 
for a minimal range of flexibility throughout processing, storage, and 
transportation. On the other hand, some supporters of the proposal 
argued against a rule providing for a tolerance because they saw this 
as undercutting the proposed rule to establish the 26 deg. F 
temperature as the most appropriate standard.

Testing and Sampling Procedures

    Some commenters said that the proposal did not address the issue 
regarding which location within a package or container, e.g., the 
perimeter or center, a sample for testing would be drawn. Commenters 
also wanted to know at what anatomical location of the product the 
temperature would be measured. Several commenters stated that products 
such as chicken wings, which are less dense than other products, should 
be excluded from temperature measurements. Also, commenters requested 
that sampling procedures should be more precisely defined to provide 
for a representative sample. One trade association requested that the 
intended sampling scheme be modified to monitor the warmest area of a 
designated ``lot,'' rather than the overall lot average, because 
products most at risk, i.e., those products furthest away from the 
cooling elements of a refrigerated chamber, could be plus 4 deg. F 
higher than the target temperature, i.e., over 30 deg. F.
    A professional organization, which agreed that the proposed action 
would meet consumer expectations, expressed concern about temperature 
abuse in light of the prevalence of Salmonella in broilers and turkeys. 
The commenter stated that the present practice of chilling poultry to 
temperatures between 0 deg. F and 26 deg. F provides a greater margin 
of safety, as compared to poultry transported and stored at 
temperatures above 26 deg. F, because temperature abuse during storage 
or transportation might raise the temperature of the poultry to 
dangerous levels above 40 deg. F. The commenter suggested that, until 
HACCP systems are implemented throughout the transportation, retail, 
and food service industries, temperature sensing and indicating devices 
should be used on poultry packaging that will alert retailers, food 
service workers, and consumers if temperature abuse has occurred.

Concerns About Responsibility for Compliance

    Generally, commenters opposed to the proposed rule objected to the 
fact that the rule was too narrowly focused on the original processor 
because the proposed requirements would apply to products in all stages 
of commerce. Many processors expressed concern that products in 
compliance at the time of processing could subsequently become 
misbranded through no fault of their own. Some supporters of the 
proposal, including congressional members, commented that the vast 
majority of poultry processors do their own packaging, storing, and 
shipping, and, therefore, would not lose a ``fresh'' designation 
through no fault of their own. They contended that one company is 
responsible for maintaining the temperature of the product at all 
points. In contrast, a number of processors reported that they shipped 
on non-company carriers. They stated that the processor, as the 
producer of the product, assumes liability for that product, yet is 
unable to ensure against potentially varying product conditions during 
distribution and sale that would be deemed non-compliant under the 
proposal. Other processors insisted that once the product is sold and 
title passes it should be the responsibility of that party 
(distributor, wholesaler, or retailer), and not the original processor, 
to ensure proper temperature or, if the product's temperature moves out 
of compliance, to relabel it. Some commenters suggested that, in order 
not to disrupt marketing and distribution of products, whether a 
product is in compliance should be determined at time of shipment.

Relabeling of Product

    Trade associations and processors contended that poultry is 
packaged such that it would be impossible to change labels on a 
particular product that may inadvertently fall below the temperature 
designated as ``fresh.'' They stated that, if products are chilled to a 
temperature below 26 deg. F while in distribution and are deemed 
``misbranded'' and unable to proceed in commerce until relabeled, the 
distributors are not equipped to relabel product. They asserted that 
under existing regulatory requirements, it would be unlawful to affix 
new labels different from the labeling affixed at the inspected 
establishment.
    A number of commenters argued that there needs to be an opportunity 
for relabeling of product at the retail level if a product accurately 
labeled at the point of packaging has been abused during shipment, 
storage, and handling after leaving the plant. Others expressed concern 
that relabeling could result in food safety problems due to the 
additional handling that would occur. One processor suggested use of a 
tag on product originating as ``fresh'' which has a tear off that can 
be removed if product falls below 26 deg. F. Some commenters noted that 
wholesalers or retailers may freeze product labeled as ``fresh'' due to 
excessive inventory and would need to repackage and relabel or apply 
appropriate stickers to products with FSIS-approved labels. These 
commenters encouraged FSIS not to require prior label approval of such 
stickers.

FSIS Response

    FSIS is confident that processors, transporters, wholesalers, and 
retailers will be able to maintain the appropriate controls to ensure 
that their poultry products comply with the requirements of this final 
rule. FSIS does not intend, therefore, to adopt a temperature tolerance 
below 26 deg. F, such as 24 deg. F, as was suggested by many 
commenters. FSIS believes that such a tolerance would allow a 
significant percentage of poultry products which had fallen below 
26 deg. F, and thus rendered hard-to-the-touch, to nevertheless be 
labeled as ``fresh,'' thereby misleading consumers.
    FSIS acknowledges that there may be instances where poultry product 
labeled as ``fresh'' may fall below the minimum temperature that 
defines ``fresh'' despite the efforts of manufacturers, distributors, 
retailers, and others to keep the product in a ``fresh'' condition. 
FSIS, therefore, intends to design a practical compliance policy that 
will maintain the integrity of the 26 deg. F standard while providing 
the flexibility to deal with the problems that occur despite the 
adoption of good manufacturing practices.
    FSIS expects that the primary focus of its compliance efforts will 
be on products labeled as ``fresh'' or bearing no descriptive term. 
FSIS resources will be focused on ensuring that such products meet the 
requirements of this regulation when they leave the FSIS-inspected 
plant. The policy will also seek to avoid condemnation or relabeling of 
entire lots of product if only a small number of units within the lot 
have fallen below the standard. FSIS expects that its compliance policy 
will take into account the good manufacturing practices that producers 

[[Page 44407]]
have adopted to maintain compliance with the requirements of this rule. 
FSIS intends to avoid the prescriptive command-and-control approach as 
to how companies achieve the performance standards in this final rule.
    FSIS shares the concerns of the many commenters about the need for 
clarification of product testing and sampling procedures and about the 
need for practical compliance procedures throughout processing, 
storage, and distribution. To provide instructions to FSIS employees 
and to assist producers in complying with this rule, FSIS intends to 
issue an FSIS Directive explaining the compliance policy, including 
product testing and sampling procedures, as soon as possible. Because 
of the complexity of the testing and sampling issue, FSIS intends to 
obtain further public input on this matter prior to issuing the 
Directive so that its procedures will be both practical and reasonable 
while ensuring the integrity of the standards contained in this final 
rule. FSIS is also interested in obtaining input on other aspects of 
the compliance policy, including the allocation of Agency and industry 
resources.
    Obviously, product in the possession of or under the control of an 
official establishment remains the responsibility of the establishment. 
Establishments must, therefore, take reasonable precautions to ensure 
that their product is maintained in accord with these regulations, even 
when it is in a transport vehicle or otherwise not physically at the 
establishment. Generally, the establishment's responsibility for 
compliance ends when ownership passes; compliance then becomes the 
responsibility of the buyer. However, any person or firm who causes a 
product to become misbranded can be held responsible for causing it to 
become misbranded whether or not they owned the product at that time.
    Moreover, any person or entity that produces product or handles 
product in commerce is responsible for ensuring that products remain 
properly labeled. If a producer, handler or commercial buyer determines 
that products covered by these regulations and labeled as ``fresh,'' or 
bearing no descriptive term, have been chilled to an internal 
temperature below 26 deg. F, that person will be responsible for 
ensuring that the product is brought into compliance. Such a producer, 
handler, or buyer must report the fact to FSIS to ensure that remedial 
action is taken.
    If an Agency official discovers product which is not in compliance 
with these regulations, the product will be retained or detained. The 
product would be required to be relabeled or, if not relabeled, the 
product would be condemned. The Agency would take such additional 
compliance or enforcement measures as are warranted under the facts and 
circumstances of each case.
    Labeling procedures for product found to require relabeling before 
it leaves the official establishment are covered under subpart N of the 
poultry products inspection regulations. Also, existing regulations (9 
CFR 381.140) specify procedures for the relabeling of products in 
commerce found to require relabeling. Generally, such products are 
relabeled under the supervision of an inspector and FSIS is reimbursed 
for the cost of that supervision. However, under the ``fresh'' 
regulations, such an enforcement approach would place a demand on 
scarce FSIS resources and cause delays in bringing product into 
compliance. This area is one of considerable concern to many 
commenters. FSIS anticipates that the circumstances requiring 
relabeling to correct misbranding where the temperature of the product 
labeled as ``fresh'' or bearing no descriptive term has dropped below 
26 deg. F after leaving the official establishment will be relatively 
infrequent. Therefore, this final rule will permit an alternative and 
simple relabeling procedure.
Relabeling Options

    The relabeling procedures established by this final rule provide 
flexibility for relabeling inspected and passed product that was 
heretofore unavailable under the poultry products inspection 
regulations when product became misbranded after leaving a federally 
inspected establishment. Owners of product will now have the option of 
notifying the Area Office of the FSIS Compliance Program that the 
product outside an establishment has become misbranded under this rule. 
The Compliance Program will authorize the movement of the product to an 
official establishment for relabeling or to a retail entity where it 
can be relabeled without an inspector's supervision, or to another end 
user. Relabeling may be accomplished by prominently applying stickers 
disclosing that the product has been ``hard chilled'' or ``frozen'' to 
the packages, provided any claim such as ``fresh'' is obliterated, 
covered or removed. Removal could be accomplished by removal of a hang 
tag or a tear off from such a tag as suggested by one commenter. At 
retail, relabeling may also be accomplished by completely removing the 
inspected establishments's label and applying the retail store's label. 
The Compliance Program will monitor such product movement and 
relabeling. The issue of who bears the cost of such relabeling is a 
contractual matter between buyers and sellers of the product.
    Accordingly, FSIS is adding a paragraph at 9 CFR 381.129(b)(6)(iii) 
to incorporate procedures for the handling and relabeling of products 
as described above. FSIS is also adding a provision at 9 CFR (b)(6) (i) 
and (ii) to specify that, if additional labeling containing a 
descriptive term required under paragraph (b)(6) (i) or (ii) of this 
section, as appropriate, is used, it shall be prominently affixed 
thereon with such conspicuousness (as compared with other words, 
statements, designs or devices in the labeling) as to render it likely 
to be read and understood by the ordinary person under customary 
conditions of purchase and use. FSIS has concluded that it would not be 
possible for such additional labeling to be placed in such fashion to 
be read and understood by the ordinary person unless the false claim is 
obliterated, covered or removed.
    FSIS also agrees with the commenter who stated that appropriate 
stickers for relabeling of product that has become misbranded should 
not require prior label approval. Because these regulations prescribe 
the exact language of descriptive labeling, this final rule provides 
that the processor may apply the descriptive labeling, or that the 
authorized retail entity or other end user may apply the descriptive 
labeling to approved labels. Furthermore, this rule provides that the 
descriptive labeling may be approved under the provisions for generic 
label approval. Such action will minimize loss of product shelf life by 
eliminating any delay involved in securing prior label approvals. 
Accordingly, FSIS is adding a paragraph at 9 CFR 381.134 to this 
effect.
Brand Names

    While some commenters stated that FSIS should maintain its current 
stance of non-restrictive use of the term ``fresh'' in trademarked 
names, company names, fanciful names, logos, and sensory modifiers, 
others contended that the proposed rule contained a loophole with 
respect to such uses. They stated that companies should not be allowed 
to incorporate the word ``fresh'' within a brand name, etc., on the 
labeling of frozen poultry products because the term would be 
inherently misleading. The commenters alleged that producers will 
continue to use and may even change their brand names so as to 
indirectly represent their products as ``fresh.'' They noted that FDA's 
fresh labeling policy does not permit such 

[[Page 44408]]
allowances for brand names, sensory modifiers, etc., and urged FSIS not 
to create an inconsistency between the two agencies' labeling 
regulations without some compelling reason. One commenter stated that 
if use of the word ``fresh'' is permitted in brand names and sensory 
modifiers, FSIS should require a specific disclaimer of equal size to 
the effect that the product had been frozen below 26 deg. F.
    FSIS does not agree that use of the word ``fresh'' as part of a 
brand name, etc., or in sensory modifiers on the labeling of a raw 
poultry product necessarily suggests or implies that the product has 
not been processed or preserved. FSIS believes that it should evaluate 
use of the term ``fresh'' within the context of the entire product 
labeling to determine if it is used to imply that a product has not 
been subjected to a chilling or freezing process, i.e., used in a false 
or misleading manner. If such an implication is made, the product would 
have to comply with the FSIS definition of ``fresh.'' This final rule 
on use of the term ``fresh'' on the labeling of poultry products 
provides for clear descriptive labeling, i.e., ``hard chilled'' or 
``frozen'' to alert consumers about the nature of products that have 
ever been brought to internal temperatures below 26 deg. F. FSIS 
believes that such labeling will prevent consumers from being misled 
about whether a product has been processed or preserved.
    This policy is consistent with FDA's policy with respect to use of 
the term ``fresh'' in a brand name or use as a sensory modifier. In the 
preamble to its final rule entitled ``Food Labeling: Nutrient Content 
Claims, General Principles, Petitions, Definition of Terms; Definitions 
of Nutrient Content Claims for the Fat, Fatty Acid, and Cholesterol 
Content of Food'' published in the Federal Register on January 6, 1993 
(58 FR 2302), FDA states at 58 FR 2405 that ``[i]f, however, a use of 
the term ``fresh'' as part of a brand name does not imply or suggest 
that the food is unprocessed, and the use is not otherwise false and 
misleading, there is nothing in this final rule that would prevent this 
use of the term.'' For these reasons, FSIS has not adopted specific 
regulatory language that governs use of the term ``fresh'' as part of a 
brand name or as a sensory modifier.
    In response to the comment that, if use of the word ``fresh'' is 
permitted in brand names and sensory modifiers, FSIS should require a 
specific disclaimer of equal type size to the effect that the product 
had been frozen below 26 deg. F, FSIS does not agree that a type size 
requirement is warranted. The special handling statements required at 9 
CFR 381.125(a), e.g., ``keep refrigerated'' or ``keep frozen,'' do not 
have specific type size requirements although they must be prominently 
displayed on the principal display panel of the label. After many years 
of use, FSIS has no information that the requirements for special 
handling statements are not adequate to inform consumers about the 
products. Therefore, FSIS rejects the suggestion to add a type size 
requirement for descriptive labeling. However, in order to ensure that 
the descriptive labeling is clearly visible on packages, FSIS is 
revising proposed 9 CFR 381.129(b)(6)(i) to provide that the 
information shall be prominently displayed on the principal display 
panel of the label. This requirement is consistent with the treatment 
of special handling label statements for frozen products as provided in 
9 CFR 381.125(a).

Economic Impact

    Several commenters suggested that FSIS, in assessing the costs and 
benefits of the proposed rule, should have quantified the benefits of 
appropriate labeling. In making its cost estimate, FSIS assumed that a 
price difference might develop between affected chill pack products and 
``fresh'' products so that the chill pack products might decrease in 
price in an amount totaling between $60 to $140 million annually. The 
commenters asserted that, considering the projected potential cost 
impact for some producers, there is likely to be a corresponding 
benefit of the same magnitude or larger to consumers who save money or 
get better value for their poultry purchases. Another commenter noted 
that FSIS listed as an unquantified consumer benefit the fact that 
consumers ``would be assured that the poultry products they purchase 
would not be labeled in a false or misleading manner.'' The commenter 
suggested that, because the proposed rule removes no products from the 
market, requires no changes in products, and leaves the choice among 
products to consumers, the estimated $60 to $140 million is a ``cost'' 
neither to the seller nor the buyer, but is a measure of the potential 
benefit to the consumer should all consumers who previously purchased 
thawed product shift their preference to fresh product. Additional 
amounts voluntarily paid by consumers place a monetary value on the 
exercise of informed choice. The commenter further asserted that the 
loss of opportunity to commit unlawful business acts such as fraud, 
deception, and misleading representation should not be accounted for as 
a cost of regulation.
    FSIS believes the latter commenter assumes that the $60 to $140 
million cost estimate reflects an increase in the price of fresh 
product. In making this particular cost estimate, FSIS assumed that the 
price of fresh product under the proposed rule would remain constant 
while the affected product, specifically 1.4 billion pounds of long-
distance-shipment chill pack product, would be priced down. FSIS made 
this assumption based on information presented at the public hearings 
and in the U.S. District Court proceedings which indicated that 
consumers generally would expect products bearing labeling with terms 
such as ``frozen'' or ``previously frozen'' to be lower priced. In this 
case, the theoretical ``cost'' represents loss of current revenues for 
producers who did not act in an unlawful manner, but in accordance with 
existing Federal policy. FSIS agrees that a price saving, which could 
be quantified, would be conferred to consumers who continue to buy the 
lower priced product as FSIS noted in its discussion of the benefits of 
the proposed rule.
    Some opponents of the proposal suggested that FSIS did not fully 
address the economic impact on product that may fall between ``fresh'' 
and ``frozen'' and for which there would not be a premium market. Many 
contended that the proposed rule, as written, could be devastating to 
the poultry industry and, especially, to tray pack operations. Some 
stated that labor costs for applying pressure sensitive stickers, 
redesigning permanent labels, costs for reapproval of labels, etc., 
will also have an economic impact. A few commenters asserted that there 
is a cost factor associated with decreased shelf life of poultry, which 
could result in increased product waste and/or more frequent deliveries 
for poultry retailers.
    FSIS has fully considered these comments on the economic impact, 
but, considering the difficulty of predicting future dollar values of 
future sales, FSIS continues to believe that it has made the most 
reasonable cost analysis possible with the information available, as is 
discussed under Executive Order 12866. The commenters provided no data 
or further information to aid FSIS in a reassessment of the costs and 
benefits of the rulemaking than were available at the time FSIS 
developed its proposal. FSIS weighed all commenters' expressed concerns 
about the economic impact of a final rule and has attempted to mitigate 
those concerns by providing flexibility through compliance procedures 
and descriptive labeling. 

[[Page 44409]]
FSIS believes that changing the requirement for what was perceived as 
very negative labeling in the form of the term ``previously frozen'' to 
the term ``hard chilled'' will enable processors to develop marketing 
strategies that promote the high quality of their products without 
misleading consumers about the products' history.
    FSIS also received a comment regarding the impact of the proposed 
rule on small entities. The commenter disagreed with FSIS' 
certification that the proposal would not have a significant impact on 
a substantial number of small entities. The commenter noted that FSIS 
stated that most smaller poultry processors use ice or dry ice packs to 
chill poultry to temperatures between 32 deg. F to 35 deg. F so that 
the proposed rule will not apply to most small processors. However, the 
commenter insisted that this assumption ignores about 1,000 small 
poultry wholesalers and retailers. The commenter contended that, 
hypothetically, if a poultry shipment leaves the processing plant in a 
``fresh'' state, but temperatures subsequently drop below 26 deg. F 
during shipment, the wholesaler or retailer has several choices as 
follows: (1) Accept the delivery and risk the sanctions for selling 
misbranded poultry, (2) accept the delivery and relabel each branded 
package with a generic label and sell the product at a loss because a 
brand name commands a higher price, or (3) refuse the shipment and send 
customers to other retail establishments to purchase poultry.
    FSIS disagrees that this rulemaking will have an impact on a 
substantial number of small wholesalers and retailers. The commenter 
provided no data to support such an argument but, rather, speculated 
about possible adverse impacts on this constituent group. Under its 
discussion on compliance procedures, FSIS has provided guidance and 
flexibility regarding actions wholesalers and retailers may take in the 
event that product labeled as ``fresh'' is found upon receipt to be 
below the minimum temperature defining ``fresh.'' FSIS believes that 
its guidance and provisions for practical relabeling options for 
wholesalers and retailers are sufficient to prevent disruption at the 
wholesale or retail level. In addition, and as noted in response to the 
preceding comments, the terminology that FSIS is providing in the form 
of the term ``hard chilled'' for the products in question should 
minimize potential lost revenues.

Other Issues

1. Cured and Processed Poultry Products

    FSIS received only two responses to its request for comments on 
whether it would be useful and desirable to initiate rulemaking to 
establish regulatory requirements for all uses of the term ``fresh'' on 
the labeling of poultry products. One commenter expressed the opinion 
that it would make sense to incorporate in the regulations the 
prohibition on use of the term ``fresh'' on the labeling of cured, 
canned, hermetically sealed shelf stable, dried, or chemically 
preserved poultry, as described in Policy Memo No. 022C. The commenter 
contended that the policy is not controversial, and it would be 
desirable to make the regulatory requirements for use of the term 
``fresh'' as comprehensive as possible. Another commenter stated, 
without further elaboration, that it is not appropriate for FSIS to 
initiate rulemaking to establish regulatory requirements for all uses 
of the term ``fresh'' on the labeling of poultry products.
    FSIS has concluded that it is not necessary to establish regulatory 
requirements for all uses of the term ``fresh'' on the labeling of 
poultry products. FSIS continues to believe that Policy Memo No. 022C 
and the current poultry products inspection regulations (9 CFR 381.129) 
are sufficient to preclude the false and misleading use of the term 
``fresh'' on poultry products that are processed or preserved by 
methods other than freezing. For clarity, FSIS is restating its policy 
on other uses of ``fresh'' on the labeling of poultry products as 
follows. The term ``fresh'' may not be used on the labeling of poultry 
products which are cured, canned, hermetically sealed shelf stable, 
dried, or chemically preserved because such use would be inappropriate 
and misleading. Chemical treatments include, but are not limited to, 
use of antioxidants, antimicrobial agents, or preservatives that 
introduce chemically active substances that remain in or on the 
product. FSIS notes that, with regard to raw poultry or poultry parts, 
no substances are permitted to be added by the poultry products 
inspection regulations for the purpose of shelf life extension.
    FSIS will allow raw poultry products to be labeled as ``fresh'' 
that had been treated with ionizing radiation at an absorbed 
pasteurization dose of 1.5 to 3.0 kiloGrays as provided for in 9 CFR 
381.147(f)(4). The treatment of raw poultry products with low dose 
irradiation causes no changes in the products that FSIS believes would 
affect consumer perceptions that they are raw and unprocessed (55 FR 
18538, May 2, 1990). In addition, the products are required to be 
labeled with a unique logo and the statement ``treated with radiation'' 
or ``treated by irradiation'' in accordance with 9 CFR 381.135, which 
distinguishes them from non-irradiated products.
    Because the term ``fresh'' has acquired acceptance when used to 
identify further processed products, i.e., products whose chemical 
composition has been changed by processes such as heating or by the 
addition of functional ingredients, that are sold in the refrigerated 
state, FSIS permits the term ``fresh'' to be used on the labeling of 
such products. Examples of such products are poultry nuggets and 
dinners sold in the refrigerated state even when they are made from 
components that are processed by procedures such as curing, canning, 
etc. as described above. In these instances, the term ``fresh'' is used 
to describe the final products, i.e., the nuggets and dinners, and to 
identify that they are refrigerated products. When used in this manner, 
the term does not imply that the components or ingredients in the final 
products, e.g., the poultry meat, are themselves unprocessed. Another 
example of this category of refrigerated product that may be labeled as 
``fresh'' while containing ingredients that could not be labeled as 
``fresh'' is a poultry salad sold in the refrigerated section of a 
grocery store. The salad might contain cured or previously frozen 
chicken or turkey meats but the term ``fresh,'' when used on such 
products, suggests a freshly made salad and does not imply that the 
ingredients are unprocessed.
    FSIS does not preclude further processed poultry products from 
bearing the term ``fresh'' on their labeling when they are in sealed 
packages or containers, which are designed to assure freshness, but are 
not shelf stable, and which are sold in the refrigerated state. 
Examples include vacuum packed products, products packaged in modified 
atmosphere packaging, and products packaged in thermoformed oxygen 
barrier multi-layer films. Further processed poultry products which 
themselves do not qualify to be labeled as ``fresh,'' but which are 
made with fresh ingredients (including non-meat and non-poultry 
ingredients), may also bear label statements stating this fact provided 
such statements clearly refer to the ingredients and do not imply that 
the products themselves are unprocessed. An example is canned gravy 
made with fresh mushrooms. With respect to ground poultry products sold 
in the fresh retail case that have 

[[Page 44410]]
been made from frozen and thawed hand deboned or mechanically deboned 
poultry, FSIS does not believe that such ground products should bear 
the term ``fresh'' on their labeling. However, FSIS does not see any 
need for the labeling of such products to disclose the fact that the 
products were made from meats that were at one time frozen. FSIS would 
not object if such products were labeled with the statement ``freshly 
ground'' when the products had, in fact, been recently ground.
    As with products subjected to freezing processes, FSIS believes the 
word ``fresh,'' when used as part of trademarked names, company names, 
fanciful names, logos, and sensory modifiers on the labeling of poultry 
products that are cured, canned, hermetically sealed shelf stable, 
dried, chemically preserved, or are refrigerated further processed 
products of the type previously described, does not necessarily suggest 
or imply that the products have not been processed or preserved. FSIS 
believes that it should evaluate the term within the context of the 
entire labeling to determine if it is used to imply that the product 
has not been subjected to such processes, i.e., used in a false or 
misleading manner.

2. Other Products

    FSIS also received comments on several issues beyond the scope of 
the proposed rule. Some commenters raised questions about the 
difference in the meaning of the term ``fresh'' as proposed for poultry 
products and its meaning for other products. Some commenters asserted 
that the proposed policy for poultry products highlights a lack of 
uniformity between the regulations for poultry and those for red meat, 
and that it would provide a marketing advantage to the red meat 
industry. Commenters also raised concerns about the apparent 
inconsistencies the proposed rule would leave between poultry and fish 
because FDA does not define a specific temperature at which a fish 
product would be deemed to be frozen. Commenters argued that the 
``fresh'' labeling rules for poultry products should also be applied to 
these other products. Since these issues do not come within the scope 
of the proposed regulations, they are not addressed in this final rule.
    In contrast to the poultry industry's marketing practices addressed 
by this rule, whole cuts of red meat are not frozen, thawed, and 
marketed as ``fresh.'' The term ``fresh'' has typically been used to 
identify those red meat products that are uncured and uncooked or 
otherwise not thermally processed or made shelf stable. The use of the 
term ``fresh'' on the labeling of red meat products has not caused 
consumer confusion. The labeling of fish and fish products is an issue 
within FDA's jurisdiction and cannot be addressed in this docket.

3. Implementation Date

    FSIS did not receive any comments on its proposed rule concerning 
an effective date or implementation period. However, the provisions of 
this final rule will require the relabeling of those products currently 
on the market whose manufacturers elect to chill, store, and ship at 
internal temperatures below 26 deg. F, but above 0 deg. F. Based on its 
review of the comments, FSIS realizes that the provisions may cause 
some processors to make operational changes so they can continue to 
supply ``fresh'' poultry. Such changes might include alternate methods 
of chilling dedicated to small trays, close adjustments of temperature 
controls in coolers and transport vehicles, modification in or purchase 
of new equipment to more precisely control temperatures, and 
development of contingency plans for products that fall below 26 deg. F 
after leaving the processing establishment.
    Therefore, FSIS has decided that sufficient time should be allotted 
for processors and handlers to make any changes necessary to comply 
with this rule. FSIS believes that processors may need to establish new 
policies and procedures, formulate methods for compliance, and exhaust 
label inventories to the extent possible. A survey of meat and poultry 
companies for FSIS' final rule on nutrition labeling indicated that 
firms carry an average label inventory of 5 to 6 months. While FSIS 
will permit use of stickers with descriptive labeling, many firms will 
likely not want to use that avenue because of the added step of 
applying the stickers and the chance that they may become dislodged. 
Therefore, many firms may want to redesign their permanent labels. 
Providing adequate time to accomplish the operational activities 
described above and to prevent inventory losses will minimize the 
impact of the final rule on affected parties. After considering the 
factors mentioned above and recognizing that product safety is not a 
concern, FSIS has determined that this final rule will be implemented 
12 months from the date of its promulgation.

Executive Order 12866

    FSIS has determined that this final rule is significant within the 
meaning of Executive Order 12866. The final rule requires all poultry 
processors and handlers to maintain the internal temperature of raw 
poultry at 26 deg. F or above if the term ``fresh'' is used on the 
labeling of such products. In addition, the final rule requires that 
poultry products whose internal temperature has ever been below 26 deg. 
F be labeled with a descriptive term reflecting this fact.

Regulatory Options

    FSIS could have chosen to prohibit the use of the term ``fresh'' on 
the labeling of raw poultry products whose internal temperature has 
ever been below 20 deg. F. Many commenters on the proposed rule stated 
that they would support 20 deg. F as a practical temperature that would 
not disrupt commercial practices and suggested that temperatures in the 
lower 20-degree Fahrenheit range were best for the preparation and 
distribution of the highest quality product. Others favored a two-step 
process control system in which temperatures between 23 deg. F and 
26 deg. F would be attributed to normal effective variances from 
refrigeration units and temperature measuring devices; temperatures 
between 20 deg. F and 23 deg. F would require process control 
adjustments; and temperatures below 20 deg. F would require product 
relabeling. If FSIS had chosen 20 deg. F as the temperature at or above 
which product could be labeled as ``fresh,'' the impact on the poultry 
industry would be minimal because few processors chill products below 
that temperature due to the cost of refrigeration unless they take the 
product to 0 deg. F or below for long-term storage. However, poultry is 
very solid and very hard at 20 deg. F, because much of the free water 
in the product is in a frozen state. Consumers perceive such products 
to be frozen rather than fresh, and their expectations for the products 
would not be met.

Impacts of the Final Rule

    In the preamble to its proposed rule, FSIS examined possible 
sources of market price changes which could result in transferring 
economic value from producers to consumers if it adopts the proposed 
rule as a final rule. FSIS stated that Americans consumed approximately 
17.9 billion pounds of chicken (retail weight) in 1993, of which 
approximately 8.9 billion pounds were purchased at retail. Based on a 
survey of broiler marketing practices, FSIS reported that 27 percent of 
chicken destined for the retail market was shipped in containers filled 
with shaved or crushed ice (ice pack) or solid carbon dioxide (dry ice 
pack); 57 percent was shipped using the chill-pack method of 
refrigeration; 3 percent was frozen (i.e., 

[[Page 44411]]
below 0 deg. F); and 13 percent was marketed in miscellaneous forms.
    Because the internal temperature of poultry products that are 
refrigerated by ice pack or dry ice pack methods ranges from about 
32 deg. F to 35 deg. F, FSIS assumed that the final rule will not 
affect this portion of the market. Also, most smaller processors use 
ice or dry ice packs because they do not have the production volume or 
chilling equipment to store and ship poultry products using the chill-
pack cooling system. For this reason, the economic impact of a final 
rule on small poultry processors should be minimal. FSIS believes that 
the final rule will not affect the 3 percent of chicken that is 
marketed at retail as frozen (i.e., below 0 deg. F). The final rule 
might have an economic impact on the 13 percent of chicken that is 
marketed in miscellaneous refrigerated forms, but FSIS has no 
information on what such an impact might be.
    In its proposed rule, FSIS stated that most turkey is prepared and 
shipped as product that is frozen to 0 deg. F or below, and, thus, most 
turkey will be unaffected by the proposal. However, FSIS received a 
number of comments from the turkey industry indicating that many of 
their products, e.g., boneless tray-pack turkey products, would be 
affected by the rule. FSIS also recognizes that, under this final rule, 
``whole bagged'' turkeys that are frozen at or below an internal 
temperature of 0 deg. F can no longer be thawed at the establishment 
before distribution and be labeled solely with a handling statement of 
``keep refrigerated.'' Rather, the labeling on these products must 
reveal that the products were at one time in a frozen condition by use 
of an appropriate statement such as ``frozen, thawed for your 
convenience.'' Therefore, FSIS has examined the market share of turkey 
compared to chicken as shown by production and per capita consumption 
data contained in USDA's Agricultural Statistics 1994 published by the 
U.S. Government Printing Office. Based on that information, FSIS 
concludes that incorporation of cost estimates for turkey would raise 
the potential cost estimate for this final rule by approximately 25 
percent.
    FSIS continues to believe that the final rule could potentially 
affect a portion of the 57 percent (5.1 billion pounds) of the 8.9 
billion pounds of chicken marketed domestically at retail as chill pack 
product, specifically, chill pack products with internal temperatures 
ranging from 20 deg. F to 25 deg. F that are destined to be transported 
long distances. FSIS examined interstate shipping distances for ready-
to-cook chicken and estimated that about 72 percent of chill pack 
products are shipped 800 miles or less. Such trips do not take more 
than two days. FSIS believes that products shipped 800 miles or less 
with proper refrigerated transportation could be labeled as ``fresh.'' 
FSIS does not believe that poultry processors using the chill-pack 
cooling system would change current procedures for products shipped 
long distances of over 800 miles. It may well be desirable to chill and 
ship poultry on long-distance hauls at temperatures in the lower 20-
degree Fahrenheit range. FSIS estimates that 28 percent (1.4 billion 
pounds) of the 5.1 billion pounds of chill pack product sold at retail 
falls into the long-distance-shipment category and might be affected by 
this final rule because it could not be labeled as ``fresh.''
    Based on information presented at the public hearings and in the 
U.S. District Court proceedings, and confirmed by commenters on the 
proposed rule, consumers generally expect frozen products to be lower 
priced than fresh products. Using a conservative estimate of price 
difference at 4 cents per pound (based on a difference in price between 
fresh and frozen turkey) and a less conservative estimate of price 
difference at 10 cents per pound, FSIS calculated a potential economic 
transfer of about $60 million to $140 million from producers to 
consumers. Adding the impacts for potentially affected turkey products 
to these amounts, the potential economic transfer becomes about $75 
million to $175 million. This impact assumes affected product would 
decrease in price and, as such, this impact represents an extreme 
scenario.
    FSIS is convinced that the extreme scenario presented will not 
actually develop considering the modifications it has made in this 
final rule in response to expressed concerns from commenters on the 
proposal. This final rule provides processors with an appropriate 
descriptive term in the form of ``hard chilled'' that does not 
disparage the products, while the term conveys to consumers the 
temperature history of the products, i.e., relates information about 
the cooling process to which the products were subjected, as well as 
their physical state after undergoing that process. Furthermore, FSIS 
is firmly committed to providing a practical and reasonable compliance 
strategy. FSIS has also provided for viable options for relabeling of 
product should that become necessary and for generic approval of such 
labeling. In addition, FSIS has provided adequate time for processors 
to come into compliance with the final rule.
    Most of the poultry products affected by this rule are branded 
products that consumers have come to recognize for their high quality. 
FSIS does not believe that all customers will turn away from the 
products they have been buying because the quality of the products will 
remain unchanged. Thus, there is no reason for the products to be 
priced down to the extent in the extreme scenario.
    It can also be argued that, under this rule, producers of fresh 
product could command even higher prices than they do now or a larger 
share of the market, which would represent a cost to the buyer. FSIS 
considers this to be quite speculative and subject to supply and demand 
and market forces. Such a situation may occur in certain areas, but, in 
general, there is no basis to assume that all consumers will pay more 
or are even willing to pay more than they do now for truly fresh 
product or would choose fresh products over those affected by this 
final rule.
    Under this final rule, affected products will also require 
relabeling with an appropriate descriptive term. About half of all 
labels submitted to FSIS each year for approval are for label changes 
on existing products. Thus, relabeling costs for printed labels arising 
from the final rule would decrease as companies incorporate the 
mandated changes with regularly scheduled label redesigns. The average 
costs of redesigning and printing new labels and inventory losses fall 
significantly as the implementation period increases. FSIS has provided 
for a 12 month implementation period so that relabeling costs for 
printed labels may approach zero taking into consideration that 
stickers may also be used as needed and generic approval of descriptive 
labeling is authorized. Stickers could always be used in those cases 
where label inventory stocks exceed a 1-year supply.
    As stated in the proposed rule, FSIS believes relabeling costs can 
be minimized considerably by use of pressure sensitive stickers until 
firms make routine label changes for existing products or exhaust label 
inventories. While this feature may not be of particular interest to 
processors on a routine basis, it is of interest to processors and 
retailers when relabeling of product becomes necessary, e.g., when 
product labeled as ``fresh'' or bearing no descriptive term falls below 
26 deg. F in commerce. FSIS estimates the cost of pressure sensitive 
stickers to be about $0.01 each. Assuming the potentially affected 1.4 
billion pounds 

[[Page 44412]]
of chill pack product were packaged in 2-pound packages, and all 
required relabeling, FSIS estimates that use of the stickers to bring 
such product into compliance, whether applied at the plant or retail 
level, would cost about $7 million, excluding the cost for labor, 
during any one year period.
    Consumers will benefit from the final rule because they would be 
assured that the poultry products they purchase would not be labeled in 
a false or misleading manner. Information from the public hearings held 
by FSIS, the informal survey conducted by the FSIS Meat and Poultry 
Hotline staff, and many comments on the proposed rule indicate that 
consumers place considerable value on knowing how poultry products were 
handled prior to being offered for sale. The quality of the products 
offered for sale would not be changed because their shelf life would 
not be adversely affected. However, consumers would not be led to pay a 
higher price for products that have been chilled to temperatures below 
26 deg. F because the informative labeling would advise them of that 
fact. Any price decreases that might occur for products that were so 
chilled would result in a savings for consumers who purchase those 
products. Thus, if a price differential results in an impact on the 
industry of $75 to $175 million, as discussed under the impact 
estimate, it is viewed as a transfer to consumers from producers.
    If products chilled below 26 deg. F do not suffer a loss in price 
or market share, it is possible that ``fresh'' products could command 
increased prices and revenues for producers of fresh poultry, who will 
be benefitted as a result of the final rule. Consumers would benefit 
because they expressed a willingness to pay more for truly fresh 
poultry that was accurately labeled as ``fresh.'' With or without an 
increased price for fresh products, consumers would be assured that 
products they buy would meet their expectations even if they elect to 
exercise their choice by paying more for the products. Truthful 
labeling information about the nature of poultry products would improve 
consumer knowledge about the products and aid them in purchasing 
decisions. FSIS believes that the benefits of labeling that is not 
false or misleading would be greater than actual costs associated with 
the final rule considering the reality of the marketplace. The labeling 
strategy then offers consumers a true purchasing option that accurately 
reflects their expressed expectations.

Executive Order 12778

    This final rule has been reviewed under Executive Order 12778, 
Civil Justice Reform. States and local jurisdictions are preempted 
under section 23 of the Poultry Products Inspection Act (PPIA) (21 
U.S.C. 467E) from imposing any marking, labeling, packaging, or 
ingredient requirements on federally inspected poultry products that 
are in addition to, or different than, those imposed under the PPIA. 
States and local jurisdictions may, however, consistent with 
requirements of the PPIA, exercise concurrent jurisdiction over poultry 
products that are outside official establishments for the purpose of 
preventing the distribution of poultry products that are misbranded or 
adulterated under the PPIA, or, in the case of imported articles, which 
are not at such an establishment, after their entry into the United 
States. Under the PPIA, states that maintain poultry inspection 
programs must impose requirements that are at least equal to those 
required under the PPIA. The states may, however, impose more stringent 
requirements on such state inspected products and establishments.
    No retroactive effect will be given to this rule. The 
administrative procedures specified in 9 CFR 381.35 must be exhausted 
prior to any judicial challenge of the application of the provisions of 
this final rule, if the challenge involves any decision of an inspector 
relating to inspection services provided under the PPIA. The 
administrative procedures specified in 9 CFR part 381, subpart W, must 
be exhausted prior to any judicial challenge of the application of the 
provisions of this final rule with respect to labeling decisions.

Effect on Small Entities

    The Administrator has determined that this final rule will not have 
a significant effect on small entities, as defined by the Regulatory 
Flexibility Act (5 U.S.C. 601). The small entities that could be 
affected by the final rule would be small processors of raw poultry. 
However, the economic impact of the final rule on such poultry 
processors (small plants operating single-inspector processing lines) 
should be minimal because such processors currently ship poultry in ice 
pack or dry ice pack containers. The internal temperature of products 
refrigerated by these methods does not fall below 26 deg. F, and 
products handled in this manner could be labeled as ``fresh'' according 
to the regulatory requirements. FSIS is aware that there are 
approximately 1,000 small wholesalers and retailers who potentially 
could be affected by this final rule. However, FSIS does not believe 
they will be impacted because this final rule provides realistic 
relabeling options for this group as discussed in the section of this 
document dealing with compliance procedures.

Paperwork Requirements
    The final rule specifies the regulations permitting the use of the 
term ``fresh'' on the labeling of raw poultry products. The final rule 
requires many manufacturers to revise their labeling and submit such 
labeling to FSIS for approval. However, this final rule also provides 
that descriptive labeling may be approved under the provisions for 
generic label approval so as to minimize paperwork requirements. 
Paperwork requirements contained in this final rule were approved by 
the Office of Management and Budget under control number 0583-0102.

List of Subjects in 9 CFR Part 381

    Food labeling, Poultry and poultry products.

Final Rule

    For the reasons set forth in the preamble, FSIS is amending 9 CFR 
part 381 as follows:

PART 381--POULTRY PRODUCTS INSPECTION REGULATIONS

    1. The authority citation for part 381 continues to read as 
follows:

    Authority: 7 U.S.C. 138f; 7 U.S.C. 450; 21 U.S.C. 451-470; 7 CFR 
2.17, 2.55.

    2. Section 381.66 is amended by adding a sentence at the end of 
paragraph (f)(2) to read as follows:


Sec. 381.66   Temperatures and chilling and freezing procedures.

* * * * *
    (f) * * *
    (2) * * * Such procedures shall not apply to raw poultry product 
described in Sec. 381.129(b)(6)(i) of this subchapter.
    3. Section 381.129 is amended by adding a new paragraph (b)(6) to 
read as follows:


Sec. 381.129   False or misleading labeling or containers.

* * * * *
    (b) * * *
    (6)(i) Raw poultry product whose internal temperature has ever been 
below 26 deg. F, but above 0 deg. F, may not bear a label declaration 
of ``fresh'' and must be labeled with the descriptive term ``hard 
chilled.'' The word ``previously'' may be used contiguous to the term 
``hard chilled'' on an optional 

[[Page 44413]]
basis. The descriptive term shall be prominently displayed on the 
principal display panel of the label. If additional labeling containing 
the descriptive term is affixed to the label, it shall be prominently 
affixed thereon with such conspicuousness (as compared with other 
words, statements, designs or devices in the labeling) as to render it 
likely to be read and understood by the ordinary individual under 
customary conditions of purchase and use. Product as described in this 
paragraph is not subject to the freezing procedures required in 
Sec. 381.66(f)(2) of this subchapter.
    (ii) Raw poultry product whose internal temperature has ever been 
at or below 0 deg. F may not bear a label declaration of ``fresh'' and 
must be labeled with the descriptive term ``frozen'' except when such 
labeling duplicates or conflicts with the labeling requirements in 
Sec. 381.125 of this subchapter. The word ``previously'' may be used 
contiguous to the term ``frozen'' on an optional basis. The descriptive 
term shall be prominently displayed on the principal display panel of 
the label. If additional labeling containing the descriptive term is 
affixed to the label, it shall be prominently affixed thereon with such 
conspicuousness (as compared with other words, statements, designs or 
devices in the labeling) as to render it likely to be read and 
understood by the ordinary individual under customary conditions of 
purchase and use. Product as described in this paragraph is subject to 
the freezing procedures required in Sec. 381.66(f)(2) of this 
subchapter.
    (iii) Handling and relabeling of products. (A) Except as provided 
under paragraph (b)(6)(iii)(C) of this section, when any inspected and 
passed product has become misbranded under this subpart after it has 
been transported from an official establishment, such product may be 
transported in commerce to an official establishment after oral 
permission is obtained from the Area Supervisor of the area in which 
that official establishment is located. The transportation of the 
product may be to the official establishment from which it had been 
transported or to another official establishment designated by the 
person desiring to handle the product. The transportation shall be 
authorized only for the purpose of the relabeling of the product. The 
Area Supervisor shall record the authorization and other information 
necessary to identify the product and shall provide a copy of the 
record to the inspector at the establishment receiving the product. The 
shipper shall be furnished a copy of the authorization record upon 
request.
    (B) Upon the arrival of the shipment at the official establishment, 
a careful inspection shall be made of the product by the inspector, and 
if it is found that the product is not adulterated, it may be received 
into the establishment; but if the product is found to be adulterated, 
it shall at once be condemned and disposed of in accordance with 
Sec. 381.95 of this subchapter. Wholesome product will be relabeled in 
accordance with paragraph (b)(6) (i) or (ii) of this section, as 
appropriate.
    (C) When any inspected and passed product has become misbranded 
under this subpart after it has been transported from an official 
establishment, the owner may transport the product in commerce to a 
retail entity for relabeling in accordance with paragraph (b)(6) (i) or 
(ii) of this section, as appropriate, or to other end users, such as 
hotels, restaurants or similar institutions; or, relabel the product in 
accordance with paragraph (b)(6) (i) or (ii) of this section, as 
appropriate if the product is already at a retail entity. A hotel, 
restaurant or similar institution is not required to relabel product 
misbranded under this subpart; Provided, That the product is prepared 
in meals or as entrees only for sale or service directly to individual 
consumers at such institutions, and that the mark of inspection is 
removed or obliterated. Oral permission shall be obtained from the Area 
Officer-in-Charge of the Compliance Program for the area in which the 
product is located prior to such transportation or relabeling. The Area 
Officer-in-Charge shall record the authorization and other information 
necessary to identify the product, and shall furnish a copy of the 
authorization record upon request. Before being offered for sale at a 
retail entity, such product shall be relabeled.
    4. Section 381.134 is amended by adding a new paragraph (b)(15) to 
read as follows:


Sec. 381.134   Generically approved labeling.

* * * * *
    (b) * * *
    (15) The addition of a descriptive term as required by 
Sec. 381.129(b)(6) of this subchapter.
* * * * *
    Done at Washington, DC, on: August 21, 1995.
Michael R. Taylor,
Acting Under Secretary for Food Safety.
[FR Doc. 95-21233 Filed 8-24-95; 8:45 am]
BILLING CODE 3410-DM-P