[Federal Register Volume 64, Number 108 (Monday, June 7, 1999)]
[Notices]
[Pages 30299-30303]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-14253]


-----------------------------------------------------------------------

DEPARTMENT OF AGRICULTURE

Food Safety and Inspection Service
[Docket No. 99-026N]


Australia's Meat Safety Enhancement Program (MSEP)

AGENCY: Food Safety and Inspection Service, USDA.

ACTION: Notice of equivalence decision.

-----------------------------------------------------------------------

SUMMARY: The Food Safety and Inspection Service (FSIS) is announcing 
its decision that the Australian Quarantine and Inspection Service's 
(AQIS) Meat Safety Enhancement Program (MSEP) for slaughter inspection 
in establishments that slaughter meat for export to the United States: 
(1) Meets all requirements of U.S. law for the import of product to the 
United States; (2) provides the same level of public health protection 
as U.S. domestic slaughter inspection; and, (3) is therefore 
equivalent. The Agency will review its equivalence decision when AQIS 
completes the MSEP field trials and prepares a report for FSIS review. 
In the interim, Australian establishments that participate in the MSEP 
field trials may ship product to the United States.

ADDRESSES: Copies of the MSEP document are available from the FSIS 
Docket Clerk, Room 102 Cotton Annex, 300 12th Street, SW, Washington, 
DC 20250-3700. A copy may also be obtained from the Australian 
Quarantine and Inspection Service homepage at http://www.dpie.gov.au/
aqis/homepage. 
    A transcript of the public meeting is available for review by the 
public in the FSIS Docket Room.

FOR FURTHER INFORMATION CONTACT: Mr. Mark Manis, Director, 
International Policy Division; Office of Policy, Program Development, 
and Evaluation; (202) 720-6400; or by electronic mail to 
[email protected].

SUPPLEMENTARY INFORMATION:

Background

    FSIS published a notice in the Federal Register on January 15, 1999 
(64 FR 2621) announcing the availability of a document prepared by AQIS 
that sets forth AQIS's plan to conduct field trials of the MSEP--a new 
slaughter inspection system. Australia sought the concurrence of the 
United States in order to continue meat exports to this country from 
plants that participate in a pilot test of MSEP. FSIS requested 
comments on the document that the public could submit in writing or at 
a public meeting.

Public Comments

    FSIS held a public meeting on February 3, 1999, to discuss the MSEP 
program and hear public comments. At this meeting, AQIS presented its 
program and responded to concerns raised by attendees.
    Most of the written comments expressed opposition to MSEP 
equivalence.
    Those in favor pointed out that the MSEP proposal resolves issues 
raised in November 1997 when FSIS informed AQIS that Project 2 (an 
earlier version of MSEP) was not equivalent because it did not provide 
an adequate form or intensity of Federal oversight. Favorable comments 
also cited the AQIS commitment to station a Government inspector on 
each slaughter line at a point between carcass trimming and final rinse 
for 100% verification that zero-fecal and other defect requirements 
have been met.
    Those opposed to MSEP equivalence raised various issues that are 
discussed in the following sections. Responses provided by AQIS are 
included in this discussion.
    1. Several comments expressed concerns about an increase in cases 
of Salmonellosis reported in Australia during 1996 and 1997. These 
cases were said to reflect problems in the Australian domestic meat 
inspection system, which is similar to MSEP. AQIS responds to this 
issue as follows:

    A Communicable Infectious Diseases report of the Australian 
Department of Health and Aged Care on Salmonella cases in Victoria 
showed that the main recent outbreaks were attributable to Italian-
style ice cream, peanut butter, mayonnaise and processed meat 
products. There was no data indicating an association of cases with 
raw meat coming from abattoirs. Conclusions from the report indicate 
that `gross errors in food handling and mishandling by consumers' 
were the principal contributing factors.
    It was indicated that the `high success rate in tracking the 
sources of outbreaks, and the associated publicity, probably led to 
more testing and more reporting of outbreaks which may previously 
have gone unreported.'
    A recent baseline study conducted on Australian export beef 
(1996) demonstrated that the incidence of Salmonella on carcases was 
0.4%. Approximately 17 years ago a similar survey demonstrated that 
the incidence was 2.0%. The results of the 1996 baseline survey 
suggests that there has been a five-fold improvement in the 
reduction of Salmonella on Australian beef. The general prevalence 
of Salmonellosis world wide has increased, as it has in Australia, 
but it can be attributed to better testing and reporting in general, 
and in the case of Australia, to items such as peanuts, coleslaw, 
eggs, etc. Testing so far for Salmonella in the context of Pathogen 
Reduction/HACCP implementation in the Australian export meat plants 
has revealed a 0.05% positive isolation rate from beef carcases.

    FSIS notes that comments about domestic foodborne illness rates in 
Australia do not relate directly to MSEP equivalence or the equivalence 
of Australian plants certified for export to the United States. AQIS 
has implemented the same or equivalent Pathogen Reduction/Hazard 
Analysis Critical Control Point (HACCP) final rule microbial testing 
programs in all U.S.-certified Australian plants. Additionally, AQIS 
has collected baseline Salmonella data and other microbial data which 
indicate that the one plant presently proposed for MSEP pilot testing 
produces very clean product under traditional inspection. These data 
will be applied as performance standards during subsequent field trials 
while the trial plant operates under MSEP. AQIS will hold this plant 
responsible for attaining the same or better microbiological results 
under MSEP than it achieved under traditional inspection. As other 
Australian export plants qualify for MSEP, AQIS and FSIS will review 
their baseline to ensure that appropriate microbial performance 
standards are applied.
    2. Some commenters expressed concerns about what activities 
constitute Government inspection under MSEP. AQIS responds as follows:

    Government inspection under MSEP comprises all of the following 
activities and responsibilities outlined in the appropriate 
Australian Federal Government legislation (The Export Control Act 
and associated Export Meat Orders). These activities and 
responsibilities include: Facilities and site standards of 
construction, hygiene etc, fit and proper person clearance of 
company principals, operational process control, ante and post 
mortem verification and oversight, disposition and control, full 
time government veterinary officer oversight, 100% verification for 
zero fecal contamination by a government meat inspector stationed at 
the end of the slaughter line, microbiological verification (ESAM 
program), macroscopic verification (Meat Hygiene Assessment), 
government approved HACCP/QA system and, government certification.

    FSIS notes that the AQIS proposal details qualification 
requirements for establishments that apply for MSEP participation and 
delineates activities

[[Page 30300]]

that AQIS will perform to ensure product wholesomeness and safety. The 
AQIS mark of inspection will be applied in MSEP plants to product that 
is handled, processed and stored in a manner that fully complies with 
AQIS Export Meat Orders and import requirements of the United States. 
AQIS will provide additional MSEP inspection controls as follows: (1) 
The AQIS meat inspector will be stationed on the line in cattle 
slaughter plants at a point before final wash; (2) final trimming will 
be under the supervision of the AQIS meat inspector; (3) the AQIS 
inspector will perform a verification for zero-fecal and other carcass 
defects on each carcass before final wash; (4) carcass defect data will 
be collected at this point on the line under the Meat Hygiene 
Assessment (MHA) program; and (5) the in-plant veterinarian will 
perform ante-mortem sampling, some verification activities, and 
oversight functions on the entire slaughter line.
    Thus, AQIS inspection under MSEP will combine direct oversight of 
company employee functions combined with carcass-by-carcass 
verification that plant HACCP/Quality Assurance (QA) systems provide 
safe and wholesome product.
    3. Several commenters questioned why AQIS has not provided baseline 
data for other plants that will participate in MSEP field trials. AQIS 
responds as follows:

    In 1996/97 five plants were selected for inclusion in the 
proposed Project 2 pilot trial. Over the course of the collaborative 
development and evolution of the Project 2 model to the MSEP model, 
the number of eligible plants has been reduced now to one. This 
plant is a beef processing plant at Rockdale, NSW. One of the 
original selected plants dropped out due to the untimely death of 
the plant's QA manager. Two others wished to retain their EU listing 
so therefore do not qualify for inclusion in MSEP at this point of 
time. The other plant does not presently meet the AQIS pre-requisite 
requirements.
    AQIS intends to bring this and other plants into the trial, once 
all pre-requisite conditions have been met, including collection of 
baseline data and prior consultation with FSIS.
    Initial `before' data as outlined in the original Project 2 plan 
has been collected from these plants. But because only one of the 
plants progressed to the MSEP stage--benchmark or performance 
standard MSEP data is not available from any other Australian plant.

    4. Some commenters suggest that MSEP cannot be found equivalent 
because AQIS presented no data proving it provides results equal to or 
better than traditional inspection. AQIS responds as follows:

    MSEP has not yet been implemented. One plant has been selected 
for initial inclusion in MSEP. Performance standard data has been 
collected from this plant. This has included both macroscopic and 
microbiological data for product along with an objective measure of 
process conformance and individual government meat inspection 
effectiveness.

    FSIS notes that AQIS cannot implement MSEP until FSIS agrees to 
accept meat from trial establishments. One purpose of MSEP field trials 
is to establish whether company employees achieve the same or better 
results under AQIS oversight and verification as were achieved by 
Government inspectors under traditional inspection. Nonetheless, FSIS 
concludes that MSEP is equivalent because it meets all requirements of 
U.S. law for the import of product to the United States and provides 
the same level of public health protection as U.S. domestic slaughter 
inspection.
    5. Several commenters cited the 1998 European Union (EU) audit of 
Australia's export meat inspection system as evidence that AQIS 
controls are not fully effective. AQIS responds as follows:

    The EU review of Australian meat export meat establishments, 
which took place in March and April 1998, raised some concerns in 
the minds of the EU reviewers. These concerns did not relate to food 
safety or sanitation but highlighted operational and 
interpretational differences between European requirements and the 
Australian system, which have been operating for many years with EU 
concurrence.
    Following high level consultations between senior Australian and 
EU officials in Brussels in October 1998, the EU has accepted 
assurances provided by Australia. The conclusions of the October 
1998 meeting were viewed positively by both the EU and Australian 
officials.

    FSIS notes that in the February 3 public meeting, AQIS fielded 
similar comments and explained that Australia and the EU had reached an 
agreement that preserved Australia's export listing. AQIS made it clear 
that it did not concur with some EU findings and had presented a 
vigorous defense of its program that resulted in an agreement of 
equivalence. In order to allay any lingering EU concerns, AQIS invited 
the EU to conduct a follow-up audit in 1999 for verification that all 
aspects of the equivalence agreement have been implemented. In May 
1999, FSIS will also visit Australia to conduct a full audit of the 
Australian export meat inspection system. The Agency will make the 
results of that audit public.
    6. Several commenters, including the Community and Public Sector 
Union (CPSU) that represents Australian Government meat inspectors, 
allege that AQIS has misrepresented union support for MSEP. They 
contend that CPSU has made its opposition to MSEP clear. AQIS responds 
as follows:

    The Australian Council of Trade Unions (ACTU), the national peak 
body representing Australian workers, has formally endorsed the 
introduction of Quality Assurance systems into the Australian meat 
industry, along with systems to further enhance the safety of 
Australian meat. It further endorses the technical and structural 
reform processes currently under way in Australia.
    The Community and Public Sector Union (CPSU) representing meat 
inspectors was originally invited to participate in a Steering 
Committee oversighting the MSEP, but withdrew because of the 
potential impact upon government meat inspector numbers.

    FSIS notes that the MSEP proposal does not contain a claim that 
CPSU or its union inspectors are MSEP supporters. Under the section 
titled Australia's ``Commitment to Food Safety,'' AQIS states in 
paragraphs 2 and 3:

    To further enhance this commitment the Prime Minister of 
Australia established a comprehensive Food Regulation Review in 
1997. This review is examining ways to enhance the effectiveness and 
efficiency of food regulatory arrangements. Further to this review, 
the Australian Food Council has established a National Safe Food 
System in association with the Australia New Zealand Food Authority 
(ANZFA) to develop a coordinated, practical and effective food 
hygiene system centred on the Food Hygiene Standard and 
complementary AQIS regulations.
    The union movement in Australia is firmly behind these 
initiatives. The Australian food industry has formalised an 
agreement with the Australian Council of Trade Unions (ACTU)--the 
Australian peak union body, on ways to introduce HACCP to Australian 
food enterprises.

    The statement about union support in paragraph 3 relates to 
Australian government initiatives enumerated in paragraph 2. In 
Attachment A to the MSEP proposal, AQIS provides a joint statement 
between the Australian Food Council and the Australian Council of Trade 
Unions pledging support for food safety reforms. MSEP is not a 
component of those reforms.
    7. Some concern was expressed about the role of the AQIS inspector 
who will be doing 100% carcass-by-carcass verification inspection at a 
point in the slaughter line between carcass trimming and final rinse. 
One concern was how this inspector could perform that function as well 
as oversee company employees, especially in multi-line plants. AQIS 
responds as follows:

    Government MSEP verification inspection in multi-line plants 
under MSEP will involve

[[Page 30301]]

carcase by carcase inspection by a government meat inspector; one 
AQIS inspector per slaughter line. Australia does not have any 
single species, multi-line plants but has 27 plants listed for the 
US which process different species. For example, a slaughter plant 
operating under MSEP and processing cattle and sheep for the US 
market would have one inspector stationed at the end of the beef 
slaughter line and another inspector stationed at the end of the 
lamb/mutton slaughter line, each inspector carrying out verification 
inspection of every carcase.

    FSIS notes that the amended AQIS proposal indicates that the 
verification inspector will operate at a fixed point on the slaughter 
line, while the AQIS veterinarian will conduct oversight of company 
employees.
    8. An additional comment was submitted by the Government 
Accountability Project (GAP) on March 31, 1999. This comment listed ten 
allegations GAP has received from what it termed ``Australian 
whistleblowers.'' Although this letter was received after the comment 
period closed, FSIS considered it in the spirit of transparency that 
underlies each equivalence decision that the Agency makes. The 
allegations are summarized as follows:

    (1) Lots sampled were not representative of the day's 
production.
    (2) Sample sizes were not consistent.
    (3) Corrective action on failures discovered in the morning 
sample was delayed until collection of afternoon data and averaging 
of both results, which meant that violations discovered at the 
beginning of production continued unabated.
    (4) Sample collection times were not consistent, and were 
manipulated to avoid exposure of defects. In particular, the timing 
was tailored as a handicap for afternoon ``improvements'' that would 
neutralize particular morning failures prior to averaging the day's 
final results.
    (5) AQIS was not expanding the scope of sampling after discovery 
of excessive violations, because industry promises to conduct 
carcass specific corrective action changed results from ``fail'' to 
``pass.''
    (6) Due to a shortage of government personnel, controls through 
``Check the Checker'' AQIS sampling did not begin until mid day to 
verify the accuracy of industry data. This essentially left the 
industry on an honor system for morning results.
    (7) For data which AQIS personnel could check in a timely 
manner, government inspectors and vets found over twice as many 
defects as reflected in industry records.
    (8) Data underlying the MHA report was not statistically 
significant, because collection was not genuinely random and there 
were only two collections daily--inadequate due to inconsistencies 
in number of samples per lot and number of lots per day that were 
monitored.
    (9) MSEP will mean the functional elimination of government 
process monitoring.
    (10) The commitment to a final fecal inspection outpost is only 
an interim measure that AQIS already has announced may be withdrawn 
if approved by ``overseas authorities.''

    FSIS interprets allegations one through eight as pertaining to AQIS 
baseline data collections that were conducted in the one Australian 
establishment presently participating in MSEP field trials. Mr. Brian 
Macdonald, Director, Meat Inspection Division, responded for AQIS to 
these eight allegations as follows:

    From the construction of Questions 1-8 it would appear that the 
GAP's information relates to the implementation of the Meat Hygiene 
Assessment (MHA) program at the Rockdale Plant in a general sense. 
This has led to a questioning of the validity of the six-month data 
set presented at the public meeting on February 3.
    While some of the wording suggests the information received 
relates to activity on a specific day the following comments assume 
their concerns relate to on-going performances.
    Question 1. The MHA system requires lots to be determined by the 
carcase identification system, that is, a lot is a group of animals 
with the same tailtag (a property of origin alphanumeric identifier 
tag). A lot may represent the entire production for a shift, or any 
part thereof. It is recommended that wherever possible the selection 
of samples be randomised. The Veterinary Officers in Charge (VOIC) 
at the plant have indicated that the correct procedure is followed 
at Rockdale. The official AQIS policy for MHA operation across the 
export meat inspection program is random selection of carcases where 
possible.
    Question 2. MHA sampling rates are appropriate and have been 
determined from the statistically validated Australian Standards 
1199-1988, Sampling Procedures and Tables for Inspection by 
Attributes. The sampling rate is based on the number of animals in a 
lot and it has been confirmed with the AQIS VOICs that the sampling 
rate is consistent with the MHA document.
    Question 3. Under MHA the sampling frequency and corrective 
action are clearly stated. Rockdale sources the majority of animals 
from an adjacent feedlot. For MHA purposes an entire day's 
production may be treated as a single lot. Thus animals slaughtered 
early in the day and late in the day may form a single lot for 
monitoring purposes. There is therefore, nothing of a sinister 
nature in the information that may have been passed to GAP.
    This is not to say that appropriate corrective action was not 
taken immediately upon finding there had been a violation. Defects 
on product are required to be removed at the time they are 
identified by trimming. Also, assessment of procedures may require a 
delay in implementation of a definitive corrective action to assess 
if the issue is related to human error or procedural error. AQIS 
staff on the establishment concerned have been and will continue to 
exercise their regulatory responsibilities in this regard.
    Question 4. As you can appreciate it is very difficult to 
respond to this allegation without further supporting evidence. 
Sampling times are supposed to vary as it is desirable that they do 
so to remove predictability from the system--employees would quickly 
learn when they are being monitored or are scheduled to be 
monitored, which would negate the value of the monitoring.
    Monitoring is primarily a company responsibility and is thus one 
of a number of tasks that company employees carry out during their 
day. It is recommended in the MHA that ``the selection of samples be 
as random as possible'' therefore if sample selection times were 
consistent AQIS would be concerned that manipulation was at risk of 
taking place. In addition, independent monitoring is carried out by 
AQIS and any significant deviation in results between company and 
AQIS monitoring is followed up by AQIS as the regulatory authority. 
The AQIS VOICs have indicated there is no evidence of manipulation.
    The point of afternoon improvements used to neutralise morning 
failures is also opposite to all practical findings on the issue of 
production line manufacturing efficiencies. Most process workers 
will perform well in the morning when they are fresh and will 
deteriorate over time due to mental and physical fatigue. There are 
many studies that substantiate that defects are more likely to occur 
toward the end of a shift than in the beginning of the shift, unless 
the operators are dealing with new procedures.
    Question 5. Under the MHA there is a defined protocol for the 
changing of sampling intensity depending on the number of 
consecutive unacceptable or marginal defects identified by the 
company at monitoring, and AQIS on-plant staff have the 
responsibility to ensure the company complies with the MHA sampling 
parameters.
    The VOICs have confirmed that where consecutive unacceptable or 
marginal defects are identified the intensity of monitoring as 
required in the MHA documentation is being implemented.
    However, where a company has an MSQA in place and is monitoring 
a CCP on the processing floor, a violation of the CCP will not be 
subject to the MHA requirements. Such a violation will be subject to 
the specific corrective actions identified in the HACCP plan, and 
must be immediate since a CCP relates specifically to food safety 
issues. AQIS on-plant staff again are responsible for ensuring the 
company complies with its HACCP plan.
    Question 6. The MHA system requires AQIS to perform check the 
checker monitoring on a twice weekly basis. It is not correct to 
conclude that at all other times industry is left to its own 
devices. Full-time AQIS inspection presence is provided at every US-
listed abattoir, otherwise the establishment simply does not operate 
for the day.
    Randomised AQIS monitoring may well mean that a check was not 
conducted in the morning. The aim of the AQIS process is to ensure 
that the company is not likely to know when check the checker 
process will occur during a shift or during the week. However there 
is an equal likelihood that any

[[Page 30302]]

part of a production shift will be subjected to an AQIS verification 
check consistent with well established quality management 
principles.
    Question 7. It is possible that government officials may have 
found twice the number of defects as recorded by industry. Such 
isolated instances might occur, for example where the company was 
training new personnel. The important point to recognise is that 
such differences are not systemically or persistently tolerated. 
Where differences are found in MHA recording results, AQIS requires 
the company to institute an appropriate corrective plan to bring the 
monitoring into conformity with standards. This is the purpose of 
having the AQIS verification checks.
    The AQIS VOICs have confirmed that where their monitoring finds 
differential recording of defects action is being taken by bringing 
the matter to the attention of management and implementing a 
documented corrective action plan.
    AQIS plant records and other reviews and checks indicate that 
not only is the MHA system working satisfactorily at Rockdale but 
that the cleanliness and health of the product is consistently of a 
very high order.
    Question 8. These comments have been addressed already and are 
summarised as follows:
     Samples are required to be selected at random wherever 
possible
     A lot is determined by animals carrying the same 
tailtag
     Sampling rates will be determined by the size of the 
lot and are based on the Australian Standard 1199-1988
     Lots monitored may represent the entire production of 
the shift or part thereof.
    Specifically for the Rockdale plant, FSIS's experience of 
imported product does not bear out the allegations made in GAP's 
letter alleging ``exposure to food poisoning threats.'' The U.S. 
rejection data for the establishment from which the empirical data 
was presented at the public meeting confirms the programs AQIS has 
implemented are working and sustained. In the last 12 months 
Rockdale Beef has presented more than 1.5 million pounds of product 
to US port-of-entry inspection with no rejections for contamination 
or pathology.
    The response outlined above is specific to the Rockdale plant. 
If GAP has specific allegations relating to the inappropriate 
operation of MHA at other Australian plants, AQIS would welcome 
receiving that advice so that the necessary action can be taken.

    Allegations nine and ten presented by GAP concern AQIS' intentions 
for government oversight of establishments that participate in the MSEP 
pilot program. AQIS responded as follows:

    Question 9. GAP has cited a meeting summary prepared by the meat 
inspectors union of discussions to explain progress with the MSEP 
proposal. The context of these discussions was negotiations for a 
new labour agreement involving an increase in meat inspector 
remuneration. The discussion on MSEP was an adjunct to this main 
purpose. Nevertheless it is not an unreasonable reflection of what 
was conveyed to the union. But, it in no way contradicts my 
statements and undertakings given at the public hearing on 3 
February.
    Australia has sought an equivalency decision from the United 
States on the basis of retaining an inspector at the end of the 
slaughter line who will undertake carcase by carcase inspection of 
all product. This was made clear at the public hearing and remains 
the proposal for which Australia is seeking equivalence. No other 
arrangement is contemplated for US listed plants.
    GAP suggests that this is breaking a prior commitment for a 
government slaughter floor inspector to monitor process controls and 
respond to breaking problems. This was not part of the proposal 
presented at the public hearing on 3 February. In my [Mr. 
Macdonald's] presentation I indicated AQIS's slaughter floor 
presence would be in two parts. First, the AQIS VOIC would undertake 
oversight and verification activities at a range of designated 
points in the production process. In the material presented, these 
points were identified and the verification frequencies quantified. 
Secondly, an AQIS meat inspector would undertake carcase by carcase 
inspection of all production after the final trim and before the 
final wash. Qualified company employees would perform sorting 
activities within the confines of this arrangement. This was all 
made very clear in my presentation and will be implemented precisely 
at trial plants.
    Question 10. The reference in the AQIS/union meeting record to 
the removal of the final AQIS inspection point needs to be put in 
context. At that point in the meeting, the discussions were 
comparing AQIS's presence in MSEP trials at non-US listed plants and 
US listed plants. AQIS was asked if at some time in the future MSEP 
could be modified to reflect the current arrangements in non-US 
listed plants where there is no final carcase by carcase AQIS 
inspection. This outcome was recognised as a possibility. You might 
note that AQIS officials modified the union prepared draft to 
clearly indicate that this was not something which Australia would 
do unilaterally and would be subject to further approval from US 
authorities.
    However, the comment is irrelevant. The commitment to carcase by 
carcase inspection is a fundamental feature of Australia's request 
for an equivalency determination from the United States. It will 
remain part of the Australian system for US listed plants.

    FSIS notes that AQIS clearly presented the details of their MSEP 
proposal in the February 3 public meeting and has in no way modified 
them since that meeting. AQIS responded to the other issues raised in 
the GAP letter, as follows:

    The GAP also raised two other issues. The first concerned 
reduction in the number of inspection staff in the Australian meat 
inspection program. It was suggested that this was being driven by 
the Australian Government's policy of full cost recovery for meat 
inspection services.
    Inspectors have only been removed where there has been no impact 
on mandatory import country requirements and on food safety, which 
remains the fundamental imperative of the Australian meat inspection 
program. Due to historical reasons the AQIS meat inspection program 
was grossly over staffed, work practices delivered extremely poor 
productivity and there was institutionalised manipulation of working 
arrangements to maximise payments such as travel allowance, overtime 
and penalty payments. It is these elements that have been 
eliminated. All elements related to public health requirements have 
been continued and, indeed, reinforced where necessary. It is 
interesting to note that the reduction in inspector numbers has 
coincided with an improvement in the Australian performance at US 
port of entry testing. You may recall that I provided this data in 
my presentation at the public hearing on 3 February.
    AQIS does not regard the additional costs imposed on industry by 
MSEP as a negative factor. MSEP requires a significant commitment by 
industry to quality systems and good manufacturing practice. 
Australian industry knows that such commitments are necessary to 
maintain markets in a world concerned with food safety and quality 
products. They are prepared to pay the price.
    The extra costs are not a reason why only one plant is ready to 
proceed on the trial at this point in time. As I explained at the 
public hearing, one plant, which is not US listed, did not continue 
with the development of the necessary systems due to the untimely 
death of a young woman who was implementing MSEP at that plant. The 
establishment was a small family business and the young woman was an 
intimate family relative. Her death had far reaching implications 
for that company in the circumstances.
    Two other plants could join the trial immediately but are also 
listed for the European Union where Australia has yet to achieve an 
equivalency determination for MSEP. Both plants remain highly 
committed to all of the quality systems developed for MSEP which are 
in place and operating except for company sorting.
    The final plant delayed implementation of MSEP in the light of 
the delays occurring in securing an equivalency decision from the 
United States. Company management has informed me they will now join 
the trial when an equivalency decision is announced.
    Finally, GAP raised the findings of a review by the European 
Commission of Australian export meat plants in March 1998. Australia 
does not accept many of the findings of the European Commission 
review, which did not look at food safety issues. Rather it examined 
Australia's conformance with European Union legislation and where 
this did not occur in detail drew conclusions about confidence in 
the Australian system. In our view there is a very large gap between 
the strict letter of European Union law and food safety outcomes. 
The former does not guarantee the latter.
    At the public hearing on 3 February I invited US consumers to 
calibrate the judgements of the European Commission reviewer against 
the food safety outcomes being secured by Australia at US port-of-
entry testing. I would ask you to continue to do so in any further 
consideration of the Australian request for equivalency.

[[Page 30303]]

    In conclusion, there has been no manipulation of the data 
presented at the public hearing in Washington on 3 February. 
Implementation of the trial will proceed precisely as explained at 
that public hearing should the United States grant equivalence to 
our proposal.

    In subsequent communications, AQIS further clarified MHA random 
sampling as the ``recommended'' procedure but acknowledged that 
``random'' often means ``unpredictable'' rather than statistically 
random. It emphasized that MHA sampling is conducted by quality control 
personnel, and that production personnel have no prior knowledge or 
influence over when or how sampling occurs.
    AQIS also clarified two additional issues. One is the U.S. 
reinspection record of the Rockdale establishment. It stated that 
during the period from April 1998 to March 1999, Rockdale exported 91 
lots to the United States. Eighteen of these lots were identified for 
further reinspection while seventy-three were checked only for 
container integrity and labeling. As noted earlier in this notice, AQIS 
reports that Rockdale had no product rejected for contamination or 
pathology for the last 12 months.
    The second additional issue concerns Australian exports to the 
European Union. AQIS reported that no interruptions of trade have 
occurred as a result of its disagreement with the EU over the March 
1998 audit results. For example, AQIS reported that from January 1999 
through April 1999, Australian establishments have shipped to EU 
countries 4,220 tonnes of beef, 7,608 tonnes of sheep and lamb, 1,177 
tonnes of horse meat, and 51 tonnes of goat meat.
    FSIS notes that AQIS has consistently provided immediate, 
comprehensive and credible responses to all questions that FSIS has 
raised about MSEP and to issues raised in public comments.

Finding of Equivalence

    The World Trade Organization (WTO) Agreement on Sanitary and 
Phytosanitary measures (commonly referred to as the ``SPS Agreement'') 
obliges the United States to respond to requests by other contracting 
parties to establish the equivalence of specified meat and poultry 
processing measures with those of the United States.
    The Australian Government formally requested that the United States 
make an equivalence determination regarding its Meat Safety Enhancement 
Program to pilot-test a revised slaughter inspection system. FSIS has 
reviewed the MSEP with particular emphasis on two criteria:
    (1) Does the MSEP meet all USDA requirements for the import of meat 
and meat products to the United States?
    (2) Does the MSEP afford American consumers the same level of 
public health protection provided by USDA domestic slaughter 
inspection?
    In summary, FSIS finds that the MSEP meets these criteria because 
MSEP will provide direct Federal oversight of Australian export 
establishment slaughter operations and verification that all U.S. 
safety and wholesomeness requirements have been met. FSIS further finds 
that AQIS has satisfactorily addressed the comments and concerns raised 
in the February 3, 1999 public meeting, the written comments presented 
in response to the Federal Register notice of January 15, 1999, and all 
subsequent comments.
    Consequently, FSIS has determined that the AQIS MSEP program (1) 
meets all USDA requirements for import of meat and meat products to the 
United States, (2) will afford American consumers the same level of 
public health protection provided by USDA domestic slaughter 
inspection, and (3) is therefore equivalent. Accordingly, AQIS-
certified establishments that participate in the MSEP field trials may 
ship meat and meat products to the United States.
    AQIS has advised FSIS that it will soon begin MSEP implementation 
testing in one beef slaughter establishment and will initiate baseline 
data collections in others as they qualify. AQIS has pledged to share 
its baseline data with FSIS before the second and any subsequent 
establishment begins implementation testing. FSIS will provide periodic 
MSEP progress summaries through the Constituent Alert.
    FSIS will review this equivalence determination when AQIS completes 
its MSEP field trials and prepares a report for FSIS review. FSIS will 
announce the results of that review in the Federal Register. FSIS will 
monitor MSEP field trials in the interim through discussions with AQIS 
personnel, review of establishment baseline and implementation data, 
periodic on-site audits, and continuous port of entry reinspection of 
products shipped to the United States. A copy of the FSIS monitoring 
plan may be obtained from Mr. Mark Manis at the address shown in FOR 
FURTHER INFORMATION CONTACT at the beginning of this notice.

    Done at Washington, DC, on June 1, 1999.
Thomas Billy,
Administrator.
[FR Doc. 99-14253 Filed 6-4-99; 8:45 am]
BILLING CODE 3410-DM-P