[Federal Register Volume 67, Number 133 (Thursday, July 11, 2002)]
[Proposed Rules]
[Pages 45922-45933]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-17431]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
 ========================================================================
 

  Federal Register / Vol. 67, No. 133 / Thursday, July 11, 2002 / 
Proposed Rules  

[[Page 45922]]



DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection Service

7 CFR Parts 300 and 319

[Docket No. 02-023-3]
RIN 0579-AB40


Importation of Clementines From Spain

AGENCY: Animal and Plant Health Inspection Service, USDA.

ACTION: Proposed rule and notice of public hearings.

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

SUMMARY: We are proposing to amend the fruits and vegetables 
regulations to allow the importation of clementines from Spain to 
resume if the clementines are cold treated en route to the United 
States, and provided that other pre-treatment and post-treatment 
requirements are met. These requirements would include provisions that 
the clementines be grown in accordance with a Mediterranean fruit fly 
management program established by the Government of Spain, that the 
clementines be subject to an inspection regimen that includes fruit 
cutting prior to, and after, cold treatment, and that the clementines 
meet other conditions designed to protect against the introduction of 
the Mediterranean fruit fly into the United States. We are proposing 
this action based on our finding that the restrictions described in 
this proposed rule will reduce the risk of introduction of 
Mediterranean fruit fly and other plant pests associated with the 
importation of clementines from Spain.

DATES: We will consider all comments that we receive on or before 
September 9, 2002. We will also consider comments made at public 
hearings to be held in Oxnard, CA, on August 20, 2002; and in Lake 
Alfred, FL, on August 22, 2002.

ADDRESSES: You may submit comments by postal mail/commercial delivery 
or by e-mail. If you use postal mail/commercial delivery, please send 
four copies of your comment (an original and three copies) to: Docket 
No. 02-023-3, Regulatory Analysis and Development, PPD, APHIS, Station 
3C71, 4700 River Road Unit 118, Riverdale, MD 20737-1238. Please state 
that your comment refers to Docket No. 02-023-3. If you use e-mail, 
address your comment to [email protected]. Your comment must 
be contained in the body of your message; do not send attached files. 
Please include your name and address in your message and ``Docket No. 
02-023-3'' on the subject line.
    You may read any comments that we receive on this docket in our 
reading room. The reading room is located in room 1141 of the USDA 
South Building, 14th Street and Independence Avenue SW., Washington, 
DC. Normal reading room hours are 8 a.m. to 4:30 p.m., Monday through 
Friday, except holidays. To be sure someone is there to help you, 
please call (202) 690-2817 before coming.
    APHIS documents published in the Federal Register, and related 
information, including the names of organizations and individuals who 
have commented on APHIS dockets, are available on the Internet at 
http://www.aphis.usda.gov/ppd/rad/webrepor.html.
    Public hearings regarding this rule will be held at the following 
locations:
    1. Oxnard, CA: Radisson Hotel, 600 Esplanade Drive, Oxnard, CA.
    2. Lake Alfred, FL: University of Florida Experiment Station, Ben 
Hill Griffin Hall, 700 Experiment Station Road, Lake Alfred, FL.

FOR FURTHER INFORMATION CONTACT: Mr. I. Paul Gadh, Import Specialist, 
Phytosanitary Issues Management Team, PPQ, APHIS, 4700 River Road Unit 
140, Riverdale, MD 20737-1236; (301) 734-6799.

SUPPLEMENTARY INFORMATION:   

Public Hearings

    We are advising the public that we are hosting two public hearings 
on this proposed rule and on the documents that support it. The first 
public hearing will be held in Oxnard, CA, on Tuesday, August 20, 2002. 
The second public hearing will be held in Lake Alfred, FL, on Thursday, 
August 22, 2002.
    A representative of the Animal and Plant Health Inspection Service 
(APHIS), U.S. Department of Agriculture (USDA or the Department), will 
preside at the public hearings. Any interested person may appear and be 
heard in person, by attorney, or by other representative. Written 
statements may be submitted and will be made part of the hearing 
record. A transcript of the public hearings will be placed in the 
rulemaking record and will be available for public inspection.
    The purpose of the hearings is to give interested persons an 
opportunity for presentation of data, views, and arguments. Questions 
about the content of the proposed rule may be part of the commenters' 
oral presentations. However, neither the presiding officer nor any 
other representative of APHIS will respond to comments at the hearings, 
except to clarify or explain provisions of the proposed rule.
    The public hearings will begin at 9 a.m. and are scheduled to end 
at 4:30 p.m., local time. The presiding officer may limit the time for 
each presentation so that all interested persons appearing at each 
hearing have an opportunity to participate. Each hearing may be 
terminated at any time if all persons desiring to speak have been 
heard.
    Registration for the hearings may be accomplished by registering 
with the presiding officer between 8:30 a.m. and 9 a.m. on the day of 
the hearing. Persons who wish to speak at a hearing will be asked to 
sign in with their name and organization to establish a record for the 
hearing. We ask that anyone who reads a statement provide two copies to 
the presiding officer at the hearing. Those who wish to form a panel to 
present their views will be asked to provide the name of each member of 
the panel and the organizations the panel members represent.
    Persons or panels wishing to speak at one or both of the public 
hearings may register in advance by phone or e-mail. Persons wishing to 
register by phone should call the Regulatory Analysis and Development 
voice mail at (301) 734-8138. Callers must leave a message clearly 
stating (1) the location of the hearing the registrant wishes to speak 
at, (2) the registrant's name and organization, and, if registering for 
a panel, (3) the name of each member of the panel and the organization 
each panel member represents. Persons wishing to register by e-mail 
must send an e-mail with the same information

[[Page 45923]]

described above to [email protected]. Please write 
``Public Hearing Registration'' in the subject line of your e-mail. 
Advance registration for either hearing must be received by 3 p.m. on 
Friday, August 16, 2002.
    If you require special accommodations, such as a sign language 
interpreter, please contact the person listed under FOR FURTHER 
INFORMATION CONTACT.

Background

    The regulations in ``Subpart Fruits and Vegetables'' (7 CFR 319.56 
through 319.56-8, referred to below as the regulations) prohibit or 
restrict the importation of fruits and vegetables into the United 
States from certain parts of the world to prevent the introduction and 
dissemination of plant pests, including fruit flies, that are new to or 
not widely distributed within the United States.
    The regulations do not contain any specific administrative 
instructions regarding the importation of clementines (Citrus 
reticulata) from Spain. However, until recently, the Animal and Plant 
Health Inspection Service (APHIS) authorized the importation of 
clementines from Spain under the regulations in Sec. 319.56-2(e)(2). 
The regulations in Sec. 319.56-2(e) provide that any fruit or 
vegetable, except those restricted to certain countries and districts 
by special quarantine and other regulations or orders now in force and 
by any restrictive order as may hereafter be promulgated, may be 
imported from any country under a permit issued in accordance with this 
subpart and upon compliance with the regulations in this subpart, if 
the U.S. Department of Agriculture, after reviewing evidence presented 
to it, is satisfied that the fruit or vegetable either:
    (1) Is not attacked in the country of origin by injurious insects, 
including fruit and melon flies (Tephritidae);
    (2) Has been treated or is to be treated for all injurious insects 
that attack it in the country of origin, in accordance with conditions 
and procedures that may be prescribed by the Administrator;
    (3) Is imported from a definite area or district in the country of 
origin that is free from all injurious insects that attack the fruit or 
vegetable, its importation can be authorized without risk, and its 
importation is in compliance with the criteria of paragraph (f) of this 
section; or
    (4) Is imported from a definite area or district of the country of 
origin that is free from certain injurious insects that attack the 
fruit or vegetable, its importation can be authorized without risk, and 
the criteria of paragraph (f) of this section are met with regard to 
those certain insects, provided that all other injurious insects that 
attack the fruit or vegetable in the area or district of the country of 
origin have been eliminated from the fruit or vegetable by treatment or 
any other procedures that may be prescribed by the Administrator.
    Until recently, clementines from Spain have been imported under 
permit, provided that they were cold treated for the Mediterranean 
fruit fly (Ceratitis capitata) (Medfly) in accordance with the 
treatment listed in the Plant Protection and Quarantine (PPQ) Treatment 
Manual, which is incorporated by reference into the regulations at 7 
CFR 300.1. The treatment listed in the PPQ Treatment Manual for 
clementines from Spain requires fruit to be held at temperatures from 
32  deg.F to 36  deg.F according to the following schedule:

------------------------------------------------------------------------
                                                               Exposure
                        Temperature                             period
                                                                (days)
------------------------------------------------------------------------
32  deg.F or below.........................................           10
33  deg.F or below.........................................           11
34  deg.F or below.........................................           12
35  deg.F or below.........................................           14
36  deg.F or below.........................................           16
------------------------------------------------------------------------

    Clementines imported from Spain were not required to meet any 
additional treatment requirements in order to be imported into the 
United States, but were subject to inspection at the port of entry.
    On November 20 and 27, 2001, live Medfly larvae were intercepted in 
clementines from Spain that were purchased by consumers from food 
stores in North Carolina and Maryland. On November 30, 2001, APHIS 
notified the Government of Spain that it was suspending the importation 
of clementines pending an investigation into the cause of the 
infestations. In the course of its investigation, APHIS traced the 
infested fruit from both locations to a single sea vessel importing 
clementines from Spain into Philadelphia, PA.
    Based on the findings of the investigation, on December 4, 2001, 
APHIS notified the Government of Spain that imports of clementines 
could resume on December 5, 2001, as we believed that the infested 
fruit likely were the product of improper application of cold treatment 
on the vessel in which they were imported. However, later that same 
day, APHIS inspectors intercepted live Medfly larvae in Spanish 
clementines during a market inspection in Louisiana. The clementines 
were traced back to a shipment of clementines that were imported from 
Spain into Newark, NJ, on a different sea vessel than the shipment that 
produced the North Carolina and Maryland interceptions.
    After the third Medfly interception, on December 5, 2001, APHIS 
notified the Government of Spain that it was suspending the importation 
of clementines based on interceptions of live Medfly larvae in Spanish 
clementines that were transported to the United States in two separate 
sea vessels. Beginning December 5, 2001, all shipments of clementines 
from Spain were refused entry into the United States. APHIS also 
announced restrictions on the marketing of Spanish clementines that had 
already been released into domestic commerce. Under those new 
restrictions, Spanish clementines could only be sold in northeastern 
U.S. States where Medfly host material was not prevalent at that time 
of year. Clementines distributed in the States of Alabama, Arizona, 
Arkansas, California, Florida, Georgia, Louisiana, Mississippi, North 
Carolina, Nevada, New Mexico, Oklahoma, Oregon, Puerto Rico, South 
Carolina, Tennessee, Texas, and Washington were required to be removed 
from retail shelves, and had to be destroyed or shipped to northeastern 
States.
    After we adopted those restrictions on clementines from Spain, 
APHIS was notified by the California Department of Food and Agriculture 
(CDFA) that CDFA inspectors had intercepted live Medfly larvae in 
imported Spanish clementines on five occasions in three California 
cities between December 3 and December 7. On December 11, 2001, after 
the restrictions on Spanish clementines had been put in place, APHIS 
inspectors intercepted additional live Medfly larvae in imported 
Spanish clementines that were being held at Port Elizabeth, NJ.
    The number of Medfly interceptions in Spanish clementines in such a 
short period of time in November and December 2001 was very 
uncharacteristic given the history of clementine imports from Spain. 
The U.S. Department of Agriculture (USDA) has allowed the importation 
of clementines from Spain since 1985. Prior to November and December 
2001, there had never been multiple confirmed finds of Medflies in 
fruit of any kind that had been legally imported into the mainland 
United States from any source. Additional problems pertaining to the 
importation of clementines have been reported in the past (i.e., 
consumer submissions to APHIS of (1) clementines with dead

[[Page 45924]]

Medfly larvae that were reported to be alive when they were found and 
(2) fruits that may not have been subject to treatment), but even those 
unconfirmed events consisted of only one or two fruits per year.
    In order to get a better sense of what factors contributed to the 
survival of Medfly larvae in clementines that were imported from Spain, 
APHIS initiated a review of the Spanish clementine import program and 
the cold treatment protocol in general. As part of this review, an 
APHIS team visited Spain in mid-December 2001. The review team noted 
that there may have been an overwhelming presence of Medfly larvae in 
Spanish clementines during the early part of the 2001-2002 production 
season. The review team concluded that the following conditions in 
clementine production areas may have contributed to the overwhelming 
larval presence:
     Unseasonably warm weather conditions;
     Above average fruit fly populations;
     High host susceptibility of the early season clementine 
varieties;
     Low trap densities and inadequate bait spray applications; 
and
     Lack of fruit cutting activities to adequately monitor 
larval populations.
    APHIS believes, based on the available evidence, that there are two 
possible explanations for the survival of Medfly larvae in imported 
Spanish clementines during the 2001-2002 shipping season. One is that 
despite the assumed mortality rate of the cold treatment (99.9968 
percent), any small or partial failure in the application of the cold 
treatment could have allowed Medflies to survive in clementines 
imported from Spain due to the above average levels of Medflies in the 
growing areas in Spain. Alternately, it is possible that the level of 
Medfly infestation in imported clementines simply overwhelmed the 
capabilities of the cold treatment process, even if the treatment was 
properly applied.
    In order to address this problem, since December 5, 2001, APHIS has 
prohibited the importation of clementines from Spain while it considers 
alternate approaches to mitigating the Medfly risk posed by clementines 
from Spain.

Determination by the Secretary

    In this document, APHIS is proposing to allow the importation of 
clementines from Spain to resume, but only under additional conditions 
that we believe will prevent the introduction of Medfly into the United 
States in clementines imported from Spain.
    Under section 412(a) of the Plant Protection Act, the Secretary of 
Agriculture may prohibit or restrict the importation and entry of any 
plant product if the Secretary determines that the prohibition or 
restriction is necessary to prevent the introduction into the United 
States or the ddissemination of a plant pest or noxious weed within the 
United States.
    The Secretary has determined that it is not necessary to prohibit 
the importation of clementines from Spain in order to prevent the 
introduction into the United States or the dissemination within the 
United States of a plant pest or noxious weed. This determination is 
based on the finding that the application of the remedial measures 
contained in this proposed rule will provide the protection necessary 
to prevent the introduction and dissemination of plant pests into the 
United States. The factors considered in arriving at this determination 
include: (1) The conclusions of a risk management analysis, ``Risk 
mitigation for Mediterranean fruit flies with special emphasis on risk 
reduction for commercial imports of clementines (several varieties of 
Citrus reticulata) from Spain'' (Revised July 5, 2002) (referred to 
elsewhere in this document as ``risk management analysis''), (2) the 
findings of a review of the existing cold treatment for clementines 
from Spain, ``Evaluation of cold storage treatment against 
Mediterranean Fruit Fly, Ceratitis capitata (Wiedemann) 
(Diptera:Tephritidae)'' (May 2, 2002) (referred to elsewhere in this 
document as ``cold treatment evaluation''), and (3) the findings of 
USDA technical experts.

Risk Management Analysis

    On April 16, 2002, we published a notice in the Federal Register 
(67 FR 18578-18579, Docket No. 02-023-1) in which we announced the 
availability of the risk management analysis and appendices. On May 24, 
2002, we published another notice in the Federal Register (67 FR 36560-
36561, Docket No. 02-023-2) in which we extended the comment period on 
the risk management analysis and appendices until June 14, 2002. Based 
on comments we received in response to those notices, we have made 
changes to the risk management analysis. Those changes are described in 
section X of the risk management analysis. APHIS will continue to 
accept comments on the risk management analysis and the other documents 
supporting this proposed rule throughout the comment period for the 
proposed rule. The revised risk management analysis and appendices can 
be viewed on the APHIS Internet site at: http://www.aphis.usda.gov/oa/clementine/index.html. Copies are also available by contacting the 
person listed under FOR FURTHER INFORMATION CONTACT.
    APHIS's risk management analysis evaluates the potential of 
remedial measures employed in this proposed rule to reduce the risk 
that Medflies could be imported into the United States from Spain. As 
part of our analysis of the risks posed by the importation of 
clementines from Spain, we identify critical control points in the 
safeguarding system which assure that risks are minimized and are 
subject to verification and monitoring by regulatory personnel. 
Identification of these critical control points permits the risk 
assessor to focus on those components of a system that are key to the 
overall effectiveness of the system.
    This approach is similar to a type of risk management approach used 
by the Food and Drug Administration (FDA) and USDA's Food Safety and 
Inspection Service, called a Hazard Analysis and Critical Control Point 
(HACCP) analysis. HACCP analyses have been found to provide an 
effective and rational means of assuring food safety from harvest to 
consumption. Preventing problems from occurring is the paramount goal 
underlying any HACCP system, and seven basic principles are employed in 
the development of HACCP plans that meet the stated goal. These 
principles include hazard analysis, critical control point 
identification, establishing critical limits, monitoring procedures, 
corrective actions, verification procedures, and record keeping and 
documentation. Using a HACCP approach, if a deviation occurs indicating 
that control has been lost, the deviation is detected and appropriate 
steps are taken to reestablish control in a timely manner to assure 
that potentially hazardous products do not reach the consumer.
    For the purposes of our risk management analysis, APHIS has applied 
the HACCP approach to the analysis of phytosanitary measures; i.e., we 
consider the critical control points employed by HACCP approaches as 
being equivalent to critical control points employed in the area of 
phytosanitary safety. We emphasize that our application of the HACCP 
approach does not represent a departure from existing guidelines for 
the phytosanitary risk analysis, but rather, is a refinement that 
reflects more emphasis on certain risk mitigating elements of a set of 
phytosanitary measures (e.g., the critical control points). A more 
detailed description of how HACCP principles can be applied to 
phytosanitary risk

[[Page 45925]]

management is shown in appendix 1 of the risk management analysis.
    As stated above, the risk management analysis considers the risk 
that Medflies could be introduced into the United States via Spanish 
clementines. We only consider Medflies in this analysis because we have 
conducted a review of the pests known to infest clementines in Spain, 
and have found that all other pests except Medflies are readily 
detectable by visual inspection, and therefore do not require 
additional risk mitigation. This pest list review is documented in 
appendix 4 of the risk management analysis. The information provided in 
the risk management analysis and its appendices meets applicable risk 
analysis standards adopted by the International Plant Protection 
Convention.
    The risk management analysis, among other things, notes that two 
elements (critical control points) are fundamental to the successful 
reduction of risks associated with the importation of clementines from 
Spain:
    1. The limitation of the population of Medflies in clementine 
production areas in Spain such that the proportion of infested fruit is 
no greater than 1.5 percent.
    2. The application of cold treatment such that a Probit 9 level of 
quarantine security is approximated.\1\
---------------------------------------------------------------------------

    \1\ A system that ensures at least 99.9968 percent mortality of 
target pests provides Probit 9 quarantine security. Probit 9 
quarantine security allows for a survival rate of no more than 
0.0032 percent of target pests. The risk management analysis does 
not assume that cold treatment alone provides a defined level of 
quarantine security (i.e., probit 9 quarantine security). Rather, 
the analysis considers other risk-mitigating measures as necessary 
to ensure that cold treatment has the potential to provide 
approximately a probit 9 level of quarantine security.
---------------------------------------------------------------------------

    The risk management analysis concludes that the risk of Medfly 
introduction via Spanish clementines would be significantly reduced if 
cold treatment is applied to fruit that have been subject to the 
proposed Medfly population reduction measures, rather than if fruit is 
simply subject to cold treatment alone. With this in mind, we have 
drafted a revised regulatory approach for the importation of 
clementines from Spain that would allow the underlying goals of both 
elements to be met if imports of clementines from Spain resume. The 
phytosanitary measures employed in the regulatory approach described in 
this document would also provide additional safeguards resulting in 
risk reductions that further diminish the potential effects of 
uncertainties and variability inherent in the commodity import system.

Proposed Requirements

    As discussed in detail below, the remedial measures contained in 
this proposed rule are intended: (1) To prevent high Medfly infestation 
levels of the sort that occurred in 2001 through the use of fruit fly 
trapping, bait treatment procedures, and record keeping requirements, 
(2) to permit the detection of high levels of Medfly infestation 
through pre-shipment inspection procedures, and (3) to prevent the 
introduction of Medflies into the United States through modified cold 
treatment and post-shipment inspection procedures.
    We are proposing to add a new Sec. 319.56-2jj, ``Administrative 
instructions; conditions governing the importation of clementines from 
Spain,'' to the regulations. Section 319.56-2jj would list the 
conditions under which the importation of clementines from Spain into 
the United States could resume. Those conditions are described in 
detail below.

Trust Fund Agreement

    Paragraph (a) of proposed Sec. 319.56-2jj specifies that 
clementines will only be allowed to be imported into the United States 
from Spain if the Government of Spain or its designated representative 
(e.g., an association of exporters of Spanish clementines) enters into 
a trust fund agreement with APHIS before each clementine shipping 
season. The agreement would require the Government of Spain or its 
designated representative to pay in advance all costs that APHIS 
expects to incur through its involvement in those elements of the 
proposed Spanish clementine regulations that must take place in Spain. 
The requirements regarding activities in Spain can be found in 
paragraphs (b) through (g) of proposed Sec. 319.56-2jj.
    Costs that would have to be paid in advance include administrative 
expenses incurred in conducting the required services in Spain and all 
salaries (including overtime and the Federal share of employee 
benefits), travel expenses (including per diem expenses), and other 
incidental expenses incurred by the inspectors in performing these 
services. The regulations and trust fund agreement would require that 
the Government of Spain or its designated representative deposit a 
certified or cashier's check with APHIS for the amount of those costs, 
as estimated by APHIS. If the deposit is not sufficient to meet all 
costs incurred by APHIS, the agreement would further require the 
Government of Spain or its designated representative to deposit with 
APHIS a certified or cashier's check for the amount of the remaining 
costs, as determined by APHIS, before the services could be continued. 
After a final audit at the conclusion of each shipping season, any 
overpayment of funds would be returned to the Government of Spain or 
its designated representative or held on account until needed.
    These requirements regarding the trust fund agreement would be 
necessary to ensure that APHIS is able to cover all costs resulting 
from its participation in the approval of clementines for export to the 
United States.

Mediterranean Fruit Fly Management Program

    Paragraph (b) of proposed Sec. 319.56-2jj specifies that persons 
who produce clementines in Spain for export to the United States must 
be registered with the Government of Spain and that they enter into the 
Government of Spain's Mediterranean fruit fly management program.
    The Government of Spain's Mediterranean fruit fly management 
program is a new program that was designed to reduce the presence of 
Medflies in areas that produce clementines for export to the United 
States to levels that are conducive to successful treatment of the 
fruit (i.e., a target infestation rate of 1.5 percent or less). Under 
paragraph (c) of proposed Sec. 319.56-2jj, the Government of Spain's 
Mediterranean fruit fly management program would be required to contain 
certain fruit fly trapping and recordkeeping requirements, and program 
operations in general would have to be approved by APHIS as adequate to 
ensure that the areas where clementines are produced for export to the 
United States indeed do have low infestation rates. The proposed 
regulations would also require that clementine producers allow APHIS 
inspectors access to clementine production areas in order to monitor 
compliance with the Mediterranean fruit fly management program.
    Specifically, the regulations and the Mediterranean fruit fly 
management program would require that, in areas where clementines are 
produced for export to the United States, fruit fly traps be placed in 
preferred Medfly host plants at least 6 weeks prior to the harvest of 
the clementines. This requirement would ensure that growers in Spain 
are able to determine the extent of the presence of Medflies in 
clementine production areas, so that appropriate control methods could 
be applied prior to harvest of fruit.

[[Page 45926]]

    In addition, bait treatments using malathion, spinosad, or another 
pesticide approved by APHIS would have to be applied in the production 
areas at a rate appropriate to maintain the level of infestation of 
clementines by Medflies at 1.5 percent or less. This proposed 
requirement would help ensure that the majority (98.5 percent) of fruit 
intended for exportation to the United States is not infested with 
Medfly larvae prior to cold treatment and that the Spanish Medfly 
management program reduces populations of Medflies to levels that allow 
for effective cold treatment of fruits exported to the United States.
    In addition, the proposed regulations would require that the 
Government of Spain or its designated representative keep records that 
document all fruit fly trapping and control activities that are 
conducted under the Government of Spain's Medfly management program. 
All trapping and control records kept by the Government of Spain or its 
designated representative would have to be made available to APHIS upon 
request. APHIS would require access to these records in order to verify 
that clementine production areas in Spain meet the requirements of the 
Government of Spain's Medfly management program and APHIS regulations.

Phytosanitary Certificates

    Under paragraph (d) of proposed Sec. 319.56-2jj, clementines from 
Spain would have to be accompanied by a phytosanitary certificate that 
states that the clementines meet the conditions of the Government of 
Spain's Mediterranean fruit fly management program and applicable APHIS 
regulations. This requirement would provide APHIS with the Government 
of Spain's assurance that imported clementines have been grown under 
conditions designed to reduce the level of infestation of the fruit by 
Medflies.

Labeling

    Paragraph (e) of proposed Sec. 319.56-2jj specifies that cartons in 
which clementines are packed would be required to be labeled with a lot 
number that provides information to identify the orchard where the 
fruit was grown and the packinghouse where the fruit was packed. The 
lot number would have to end with the letters ``US,'' and the labeling 
would have to be large enough to clearly display the required 
information and be located on the side of cartons to facilitate 
inspection by APHIS.

Pre-Treatment Sampling

    Clementines that are produced under the Government of Spain's 
Medfly management program should have low levels (i.e., 1.5 percent or 
less) of infestation with Medflies prior to cold treatment. In order to 
ensure that the efficacy of the cold treatment is not undermined by 
high levels of infestation, paragraph (f) of proposed Sec. 319.56-2jj 
would require that, prior to beginning cold treatment of a shipment of 
clementines, APHIS inspectors will cut and inspect a designated number 
of fruit that are randomly selected from throughout the shipment. A 
shipment could include as little as one shipping container of 
clementines (approximately 166,000 fruit) or could be a bulk shipment 
of approximately 972,000 clementines (a maximum of 120 pallets, with 
each pallet containing approximately 8,100 fruit). A shipment is 
basically a group of fruit from one packinghouse that is presented for 
inspection by APHIS. A shipment from a single packinghouse could 
include fruit from many different orchards.
    If inspectors find a single live Medfly in any stage of development 
during an inspection, the entire shipment of clementines would be 
rejected. While a single Medfly interception in a shipment of Spanish 
clementines may not be proof that the shipment is highly infested, such 
a detection provides a statistical basis by which to infer that fruit 
could be 1.5 percent infested or more. Conversely, if no Medflies are 
intercepted during an inspection of a shipment of fruit, there is a 
statistical basis upon which to assume that the fruit sampled is less 
than 1.5 percent infested.
    Further, if a live Medfly in any stage of development is found in 
any two shipments of fruit from the same orchard during the same 
shipping season, that orchard would be removed from the export program 
for the remainder of that shipping season.

Rates of Pre-Treatment Sampling

    For the first clementine shipping season that occurs under the 
regulations described in this proposed rule, inspectors would cut 200 
randomly selected fruit per shipment. We chose 200 as a sample size 
because, according to hypergeometric sampling rates, this sample size 
provides a 95 percent chance of finding one or more infested fruit when 
the infestation rate (percent of fruit infested) in the shipment 
sampled is 1.5 percent, provided that the size of the shipment sampled 
falls within the range described earlier in this document (between one 
container and 120 pallets). Since the regulations would require 
shipments in which Medflies are detected to be rejected, we are 
confident that only clementines with very low levels of infestation 
with Medflies would proceed to the next step in the import process.
    The proposed regulations also contain provisions that would allow 
the sample size for pre-treatment fruit cutting to be adjusted for 
subsequent shipping seasons based on the number of rejections of 
shipments that occur during the previous shipping season. For the 
purposes of this proposed rule, a shipping season would include the 
period beginning approximately in mid-September and ending 
approximately in late February of the next calendar year. This is to 
say that if our experience with fruit cutting suggests that the 
majority of Spanish clementines presented for exportation to the United 
States are not infested with Medflies, we would decrease the number of 
fruit that need to be cut and inspected. Conversely, the sample size 
could be returned to higher levels if the number of rejections of 
shipments rose above a specified percentage of the shipments. The 
sample size adjustments and their triggers are shown in the following 
table:

------------------------------------------------------------------------
                                                          . . . then the
 If the sample size for a given       . . . and the      sample size for
          season is--             rejection rate during  the next season
                                    that season is--           is--
------------------------------------------------------------------------
200............................  5 percent..          \1\ 100
                                 >5 percent............              200
100............................  2 percent..           \2\ 76
                                 >2 percent but 5 percent.
                                 >5 percent............              200
76.............................  2 percent..               76
                                 >2 percent but 5 percent.

[[Page 45927]]

 
                                 >5 percent............             200
------------------------------------------------------------------------
\1\ According to hypergeometric sampling rates, this sample size
  provides a 95 percent chance of finding one or more infested fruit
  when the infestation rate (percent of fruit infested) in the shipment
  sampled is 3 percent.
\2\ According to hypergeometric sampling rates, this sample size
  provides a 90 percent chance of finding one or or infested fruit when
  the infestation rate (percent of fruit infested) in the shipment
  sampled is 3 percent.

    These potential changes in the sample size for shipments of 
clementines that have not yet been cold treated would provide for 
responsive changes in inspection protocols based on the success Spanish 
growers and exporters have in maintaining low Medfly infestation levels 
in clementines, as indicated by Medfly interceptions during fruit 
cutting. However, if APHIS determines that fruit presented for 
inspection and treatment appear to be highly infested during a shipping 
season in which 100 or 76 fruit are cut per shipment, APHIS would 
reserve the right to increase the required sample size during the 
shipping season. At no time would more than 200 fruit be required to be 
cut, but the sample size could be raised to that level at APHIS's 
discretion, depending on the number of Medfly interceptions.
    The sample rates described above are each designed to ensure that, 
prior to cold treatment, APHIS can ensure that the level of Medfly 
infestation in clementines is sufficiently low to provide for effective 
treatment of the fruits.

Cold Treatment

    Cold treatment of imported fruit is often conducted while the 
vessel carrying the fruit is en route to the United States, as cold 
treatment requires several days to cause mortality of target pests. 
Clementines from Spain are typically held in a refrigerated hold of 
cargo ship or in a refrigerated shipping container, and records are 
kept during transit to verify that the treatment for Medfly is 
successfully completed.
    As stated earlier in this document, after the interceptions of 
Medflies in clementines from Spain in December 2001, APHIS undertook a 
review of activities associated with the production and treatment of 
Spanish clementines. As part of this review, APHIS is sponsoring 
additional research on the application of cold treatments for imported 
fruits and vegetables. In addition, APHIS asked a panel composed of 
APHIS regulatory personnel and USDA technical experts on fruit flies to 
conduct a review of available scientific literature related to the 
efficacy of the cold treatment for Medfly described earlier in this 
document, with the intention of using the panel's findings as 
guidelines on the future application of cold treatment. The panel found 
that the existing cold treatment schedule, while providing a very high 
level of Medfly mortality, does not provide Probit 9 level quarantine 
security in all cases. The panel also found that the high numbers of 
larvae present during the early part of the 2001-2002 growing season 
overwhelmed the ability of the cold treatment to provide quarantine 
security, and concluded that the present cold treatment schedule is 
insufficient for controlling high larval populations of Medflies and 
may result in Medfly survivors. The panel's findings are corroborated 
by an additional quantitative USDA analysis, ``Quantitative Analysis of 
Available Data on the Efficacy of Cold Treatment Against Mediterranean 
Fruit Fly Larvae'' (July 5, 2002).
    Based on its review of the available scientific literature and of 
all factors involved in quarantine cold treatments against Medfly eggs 
and larvae, the panel recommended increasing the length of the required 
cold treatment at each temperature by 2 days. The cold treatment 
evaluation and the quantitative analysis referred to above can be 
viewed on the APHIS Internet site at: http://www.aphis.usda.gov/oa/clementine/index.html. Copies are also available by contacting the 
person listed under FOR FURTHER INFORMATION CONTACT.
    Based on the panel's recommendation, we are proposing to amend the 
PPQ Treatment Manual by revising the Medfly treatment listed for 
clementines from Spain.\2\
---------------------------------------------------------------------------

    \2\ The current cold treatment used for clementines from Spain 
is also applicable to a number of other commodities imported from 
several different countries. We are only proposing to amend the cold 
treatment for clementines from Spain in this document, and we intend 
to make changes to the treatments for the other commodities in a 
separate rulemaking.
---------------------------------------------------------------------------

    The revised treatment schedule would require clementines from Spain 
to be held at temperatures from 32  deg.F to 36  deg.F according to the 
following schedule:

------------------------------------------------------------------------
                                                               Exposure
                        Temperature                             period
                                                                (days)
------------------------------------------------------------------------
32  deg.F or below.........................................           12
33  deg.F or below.........................................           13
34  deg.F or below.........................................           14
35  deg.F or below.........................................           16
36  deg.F or below.........................................           18
------------------------------------------------------------------------

    There should be no effect on fruit quality due to the increased 
holding times, based on anecdotal information from New Zealand's 
Ministry of Agriculture and Forestry.
    In conjunction with this revised treatment protocol, the proposed 
rule would require that, upon arrival of clementines at a port of entry 
into the United States, APHIS inspectors will examine the cold 
treatment data for each shipment \3\ to ensure that the cold treatment 
was successfully completed. If the cold treatment has not been 
successfully completed, the shipment would be held until appropriate 
remedial actions have been implemented.
---------------------------------------------------------------------------

    \3\ Cold treatment records and data must be made available to 
APHIS under Sec. 319.56-2d(b)(3)(i).
---------------------------------------------------------------------------

    Appropriate remedial actions would depend on the circumstances of 
the treatment failure, but could include retreatment, extension of 
treatment, destruction, disposal, or reexportation of fruit. For 
instance, if the treatment records for a vessel reveal that a single 
cargo hold did not maintain the appropriate cold treatment temperature 
during the first 2 days of a 13-day treatment, inspectors could require 
that the fruit in that hold be held at the appropriate temperature for 
an additional 2 days prior to allowing the fruit to be removed from the 
vessel and inspected. In the event that temperature is not maintained 
during the middle of the treatment period, an inspector could allow the 
fruit to be containerized and retreated according to the appropriate 
treatment schedule prior to release into domestic commerce. 
Alternately, the inspector could allow the shipment to be reexported to 
a country that does not require treatment of fruits for Medflies, or 
the fruit could be destroyed or disposed of according to certain 
conditions.

[[Page 45928]]

Port of Entry Sampling

    Under paragraph (h) of proposed Sec. 319.56-2jj, clementines 
imported from Spain would be subject to inspection by an inspector at 
the port of entry into the United States. This includes inspection for 
hitchhiking pests that could be present in shipments of clementines, in 
addition to fruit cutting inspections for Medflies.
    In order to ensure that the proposed cold treatment, in combination 
with other proposed requirements, is working correctly, APHIS 
inspectors would cut and inspect randomly selected fruit at a sampling 
rate determined by the Administrator. The number of fruit to be cut 
could be adjusted based on the historical success of the treatment.
    For the first clementine shipping season that occurs under the 
regulations described in this proposed rule, APHIS would cut 1,500 
randomly selected fruit per shipload or 150 randomly selected fruit per 
shipping container.\4\ We chose these particular sample sizes because, 
according to hypergeometric sampling rates, they provide a 95 percent 
chance of finding one or more infested fruit when (1) the infestation 
rate (percent of fruit infested) in the shipload sampled is 0.2 
percent, or (2) the infestation rate (percent of fruit infested) in the 
shipping container sampled is 2.0 percent.
---------------------------------------------------------------------------

    \4\ A shipload could contain approximately 2,509 metric tons of 
clementines--equivalent to approximately 22.6 million fruit at a 
rate of 9,000 fruit per metric ton. As stated earlier in this 
document, a shipping container could contain approximately 166,000 
fruit.
---------------------------------------------------------------------------

    For future shipping seasons, APHIS may reduce the amount of fruit 
to be cut at the port of entry as our confidence in the effectiveness 
of the cold treatment increases. However, if inspectors detect a single 
live Medfly in any stage of development in a shipment of Spanish 
clementines, the shipment of clementines would be held until an 
investigation is completed and appropriate remedial actions have been 
implemented. Further, regardless of the level of inspection applied at 
that time, any further inspections would be subject to increased rates 
of inspection not to exceed 1,500 randomly selected fruit per shipload 
or 150 randomly selected fruit per shipping container, and inspections 
would remain at that level until APHIS is able to determine the cause 
of infestation and apply appropriate remedial measures.
    Appropriate remedial actions would depend on the circumstances of 
the infestation, but could include retreatment, destruction, disposal, 
or reexportation of fruit. For instance, if fruit cutting reveals 
infestation of clementines with Medflies, and APHIS determines that the 
infestation is limited to fruit imported in a specific cold treatment 
hold or container in the vessel, APHIS could require that the infested 
fruit be reexported or destroyed. If APHIS is unable to link the 
infestation to a particular treatment hold or container, an inspector 
could refuse entry of the clementines and require them to be reexported 
or destroyed. Furthermore, if APHIS determines at any time that the 
required cold treatment or other safeguards contained in the proposed 
regulations are not protecting against the introduction of Medflies 
into the United States, APHIS may suspend the importation of 
clementines from Spain and conduct an investigation into the cause of 
the deficiency.

Definitions

    Paragraph (i) of proposed Sec. 319.56-2jj would clarify that, as 
stated earlier in this document, for the purposes of the proposed 
regulations, a shipping season would be considered to include the 
period beginning approximately in mid-September and ending 
approximately in late February of the next calendar year.

Limited Distribution

    We are considering instituting a limited distribution plan that 
would delay the entry of Spanish clementines into citrus-producing 
areas in the United States for up to 1 full shipping season. This would 
mean that clementines could not be distributed in or imported into 
California, Arizona, Texas, Florida, Louisiana, Puerto Rico, the U.S. 
Virgin Islands, the Northern Mariana Islands, Guam, and American Samoa 
as an additional precaution against the introduction of Medflies into 
those areas, whose citrus industry could be severely harmed if Medflies 
were introduced into commercial production areas. This delay would 
provide an opportunity for the efficacy of the proposed regulations to 
be demonstrated under actual production and distribution conditions for 
1 full shipping season before Spanish clementine imports would be 
allowed to enter citrus-producing areas of the United States. We invite 
the public to submit information demonstrating whether or not this 
confidence-building measure is warranted.

Executive Order 12866 and Regulatory Flexibility Act

    This proposed rule has been reviewed under Executive Order 12866. 
The rule has been determined to be significant for the purposes of 
Executive Order 12866 and, therefore, has been reviewed by the Office 
of Management and Budget.
    For this proposed rule, we have prepared an economic analysis. The 
economic analysis provides a cost-benefit analysis as required by 
Executive Order 12866, as well as an analysis of the potential economic 
effects of this proposed rule on small entities, as required under 5 
U.S.C. 603. The economic analysis is summarized below. See the full 
analysis for the complete list of references used in this document. 
Copies of the full analysis are available by contacting the person 
listed under FOR FURTHER INFORMATION CONTACT, or on the Internet at 
http://www.aphis.usda.gov/oa/clementine/index.html.
    Under the Plant Protection Act (7 U.S.C. 7701-7772), the Secretary 
of Agriculture is authorized to regulate the importation of plants, 
plant products, and other articles to prevent the introduction of 
injurious plant pests.

Summary of Economic Analysis

    Our analysis estimates expected benefits and costs associated with 
lifting the ban on the importation of Spanish clementines by the 
beginning of the next shipping season (mid-September 2002). Expected 
benefits and costs are estimated relative to the current ban and 
relative to the previous import program. Benefits and costs are 
estimated relative to the ban, because the ban is currently in effect. 
Benefits and costs are estimated relative to the previous import 
program, because this provides a useful benchmark for measuring 
relative benefits and costs. Potential benefits associated with lifting 
the ban include increased profits for importers and wholesalers and 
increased clementine supplies for retail consumers in the United 
States. Potential costs include eradication and other expenses that 
might be borne by taxpayers and fruit and vegetable producers in the 
United States in the event live Medflies are introduced.
    Under the most likely scenario examined in the analysis, expected 
welfare gains relative to the current ban are approximately $210 
million for marketing season 2002, which includes $120, $60, and $30 
million in estimated welfare gains for importers, wholesalers, and 
retail consumers, respectively, with practically no increase in 
expected costs to U.S. taxpayers and fruit and vegetable producers. In 
addition, under the most likely scenario, expected welfare gains 
relative to the previous import program are over $26 million for 
marketing season 2002. This includes $15, $8, and $4 million in 
relative gains for

[[Page 45929]]

importers, wholesalers, and retail consumers, respectively, and 
approximately $50,000 in gains to U.S. taxpayers and fruit and 
vegetable producers in the United States arising from improved Medfly 
management.

Clementine Market

    Clementines are not grown domestically in significant quantities; 
therefore, U.S. consumption during the last 15 years (Snell 2002) has 
depended on imports from Spain, which contributed 90 percent of total 
U.S. imports during 1996-2000 (FAS 2002). Between 1991 and 2000, 
Spain's annual production of clementines averaged slightly over 1.1 
million metric tons. During 1991-2000, Spain exported most of its 
clementines to Germany, France, the United Kingdom, and the 
Netherlands; however, exports to the United States grew 45 percent per 
year during this period, even though clementine production in Spain 
grew only 2 percent per year (FAS 1996-2001, MAPA 1999). The phenomenal 
growth in exports to the United States has been due to increased 
demand, leading to high import prices in the United States relative to 
import prices in the rest of the world. During 1989-2000, prices 
offered by U.S. importers averaged 20 percent higher than prices 
offered by all other importing countries, providing incentives 
sufficient for exporters to ship an average annual 6 percent of total 
exports to the United States in 1999 and 2000.
    Spain exports clementines to the United States during mid-September 
to late February. Morocco, Italy, and Israel also export clementines to 
the United States during this marketing period; however, during 1996-
2000, only 2 and 0.1 percent of U.S. clementine imports were from 
Morocco and Italy, respectively, and during 1998-2000, only 0.4 percent 
of U.S. clementine imports were from Israel. This suggests that 
exporters in these countries have not established export market 
infrastructures sufficient to allow for massive increases in shipments 
to the United States in the short run. In addition, clementines from 
these countries are typically of lower quality as reflected in lower 
average prices paid by U.S. importers. As a result, it is assumed that 
exports from Morocco, Italy, and Israel will not be able to fill the 
void left by the ban on Spanish clementines in the short run.
    It is unclear whether clementine imports and domestically produced 
tangerines (Citrus reticulata) may be substitutes. Pollack and Perez 
(2001) have suggested that the two types of citrus may be substitutes; 
however, they did not estimate a substitution rate. We estimated the 
rate of substitution using a linear relationship between tangerine 
prices received by U.S. producers, a constant, wholesale tangerine 
consumption, and U.S. clementine imports. Although the coefficient 
estimate on clementine imports from Spain was negative, indicating 
clementines and tangerines may be substitutes, the coefficient estimate 
was not statistically different from zero. As a result, it is not clear 
whether clementines and tangerines are substitutes. Because only 12 
annual observations were available, we request information and data 
from the public relevant to the estimation of the rate of substitution 
between domestically produced tangerines and Spanish clementine 
imports. In addition, we request information and data from the public 
relevant to the estimation of the rate of substitution between other 
domestically produced citrus fruit and Spanish clementine imports. In 
particular, we are interested in weekly or monthly price and quantity 
data for the relevant markets (Spanish clementine and domestically 
produced tangerines and other citrus fruits) during the clementine 
marketing season, mid-September to late February.
    In addition, there are differences between Spanish clementines and 
domestically produced tangerines, which may be important to U.S. 
consumers. In particular, clementine imports are seedless and are 
packaged in small wooden boxes; whereas domestically produced 
tangerines are generally not seedless and are marketed in bulk 
quantities. Tangerine wholesalers are apparently considering 
alternative marketing strategies based on the clementine model; 
however, it is not clear if or when wholesalers will adopt this 
marketing strategy (Pollack 2002). Moreover, consumption of 
domestically produced tangerines (233,147 metric tons) was almost three 
times higher than consumption of clementines (83,631 metric tons) in 
the United States in 2000. Finally, the proposed rule would permit the 
re-entry of Spanish clementines which, until the ban in the fall of 
2001, have been imported into the United States for 15 years.
    Because it is not clear if tangerines substitute for clementines in 
the aggregate, more domestically produced tangerines are consumed in 
the United States relative to clementines, and clementines from Spain 
have been imported historically the proposed rule would likely not have 
a significant impact on U.S. tangerine producers. As a result, we do 
not estimate impacts associated with the proposed rule on U.S. 
tangerine producers in the current analysis. However, if U.S. demand 
for clementines continues to grow under the proposed rule and 
clementines substitute for domestically produced tangerines, then the 
proposed rule would lead to downward pressure on tangerine prices and 
profit losses for U.S. tangerine producers.

Costs Associated With the Proposed Rule

    Additional costs include direct cost increases for local and 
federal governments in Spain, exporters in Spain, and Spanish 
clementine producers associated with producing and exporting 
clementines to the United States. We assume that Spanish clementine 
export supply is perfectly inelastic with respect to U.S. import prices 
and, as a result, that marginal production and export costs associated 
with the proposed rule borne directly by Spanish parties are not passed 
on to U.S. importers, wholesalers, and retail consumers. The assumption 
of perfectly inelastic supply is appropriate for a short-run analysis 
such as this and does not substantially affect the results of the 
analysis. Cost increases also include potential reductions in 
clementine import levels due to rejections of clementine shipments in 
Spain and in the United States in the event APHIS inspectors detect 
live Medflies in fruit inspections. Because rejected shipments must be 
diverted to other markets, clementine import quantities may be reduced 
leading to reductions in the economic benefits received by U.S. 
importers, wholesalers, and consumers. Finally, cost increases also 
include potential costs associated with the introduction of live 
Medflies into the United States.
    Note that initial export quantities are referred to as 
``designated'' in the analysis. This is because not all of the 
clementines initially designated for export to the United States will 
be exported to the United States. Some fruit will be cut and discarded 
in Spain and in the United States, and some of the quantities inspected 
(inspectional units) might be rejected and therefore not allowed to be 
exported to the United States. Increases in clementine production costs 
associated with the mandatory Medfly management program in Spain 
include purchases of additional traps for producers, purchases of baits 
for the traps, monitoring and recordkeeping costs, additional bait 
spray costs, additional cold treatment costs, and trust fund expenses. 
These additional costs will likely be borne by the Government of Spain, 
local governments, and

[[Page 45930]]

exporters. It is assumed that production decisions and designated 
export quantities will not be affected by these additional costs.
    Total trap and bait expenses for Spanish growers are estimated to 
be very small (less than $1,000) for the first year, or 0.0013 percent 
of the average value of Spanish clementine exports to the United States 
for 1999 and 2000 ($78.69 million, FAS 2002), the majority of which 
will be spent on traps that can typically be used for several years. As 
a result, additional trap and bait expenses will represent very minor 
increases in fixed and variable costs, respectively, which will likely 
not affect production decisions regardless of who pays for them. Annual 
trust fund expenses for the Government of Spain or its agent are 
estimated to be at least $90,000, including 16.15 percent 
administrative overhead (West 2002). These costs represent a more 
substantial increase in fixed costs, 0.1144 percent of average export 
value for 1999 and 2000. However, because the increase in fixed costs 
is small relative to the value of exports, we assume that production 
decisions and designated export quantities will not be affected.
    The additional 2 days of cold treatment may add anywhere between 
$92,000 and $128,000 in annual expenses for all exporters (0.1627 
percent of average export value for 1999 and 2000); however, because 
this also represents a minor fraction of the total value of exports, we 
assume that designated export quantities are not affected by these cost 
increases. We were unable to estimate additional costs associated with 
monitoring and recordkeeping in Spanish groves, which producers will be 
required to pay; however, these costs may be low as well, because the 
auditing agencies responsible for monitoring and recordkeeping are 
already in place for the U.S. Food and Drug Administration's pesticide 
residue program. It is not clear if or by how much annual bait sprays 
and spray costs may increase; however, these costs may be borne 
entirely by federal and local governments in Spain and therefore not 
affect production decisions or initial designated export quantities.
    Fruit cutting and rejection of inspectional units in Spain and in 
the United States will reduce U.S. clementine imports by approximately 
0.0069 percent, because it is assumed in the analysis that exporters do 
not adjust initial designated export quantities to the United States in 
the event inspectional units are rejected. Therefore, these costs are 
measured in terms of lost revenues for importers and wholesalers and 
lost consumer benefits in the United States. Fruit will be cut in Spain 
at a rate of 200 clementines per inspectional unit, which might range 
in size from one 40-foot container (166,050 clementines) to 5.85 forty-
foot container equivalents (972,000 clementines). Losses will include 
fruit that is cut and discarded, a relatively small cost that declines 
with inspectional unit size. Losses may also include rejections of 
inspectional units, where the rejection rate will depend on the 
proportion of fruit that is infested with Medflies (the infestation 
rate), the sample rate, and inspectional unit size.
    Expected costs associated with potential Medfly introductions are 
based on estimated import levels and the infestation rate. For a given 
infestation rate, the expected number of introductions per year is 
given by the number of forty-foot container equivalents imported 
multiplied by the probability a typical container will lead to an 
introduction. The introduction probability is given by the probability 
that mating pairs (adult male and female Medflies) survive the export 
process and are delivered to an area suitable for the development of 
their offspring. We use the methods discussed in APHIS (2002) to 
estimate the introduction probability.
    Expected costs associated with potential Medfly introductions are 
given by the product of the expected number of introductions and an 
estimate of the cost of one introduction. The mean cost of eradicating 
the last six Medfly introductions is $10.93 million in 2000 dollars 
(APHIS 1999). We use this as the estimate of U.S. taxpayer costs 
associated with a Medfly introduction. Additional costs borne by U.S. 
producers during an introduction (e.g. additional field sprays, post-
harvest treatments, fruit losses, post-harvest fruit losses, and loss 
of export markets) are estimated at approximately $3 million per 
introduction. Expected Medfly introduction cost estimates under the 
proposed rule are calculated for the range of designated export 
quantities examined in the analysis. Under the most likely infestation 
rate examined in the analysis, expected costs associated with Medfly 
introductions are almost non-existent for each designated export 
quantity (1.12e-07 percent of average export value for 1999 and 2000). 
This is because the probability of a Medfly introduction per forty-foot 
container equivalent is extremely low (1.31e-12). For purposes of 
comparison with the previous import program, a calculation was also 
made of the expected Medfly introduction cost estimate under the 
previous import program. The expected cost under the previous import 
program amounted to nearly $50,000 (0.06 percent of average export 
value for 1999 and 2000).

Calculation of Benefits and Costs

    Expected benefits and costs associated with the proposed rule vary 
with the amount of clementines imported into the United States and the 
proportion of clementines infested with Medflies in Spain (infestation 
rate). Because prices offered by U.S. importers are typically 20 
percent higher than prices offered in the rest of the world, because 
the proposed rule provides significant incentives for Spanish growers 
to manage Medfly populations effectively, and because exporters will be 
able to choose clementines from regions in Spain with relatively low 
Medfly population levels the infestation rate will likely be low for 
marketing season 2002. In the risk mitigation analysis for the proposed 
rule, APHIS (2002) simulated infestation rates under the proposed rule 
and under the previous import program. We base the most likely 
infestation rates examined in the analysis on their simulation results.
    Benefits and costs are estimated for a range of likely designated 
export quantities for marketing season 2002, under the assumption that 
export supply is perfectly inelastic with respect to U.S. prices. We 
examine a minimum quantity based on the import quantity for marketing 
season 2000 (83,631 metric tons), a most likely quantity based on the 
rate of growth in imports between marketing seasons 1999 and 2000 
(90,032 metric tons), and a maximum quantity based on the average 
annual rate of import growth from 1989-2000 (116,406 metric tons). The 
minimum level is examined because costs associated with the proposed 
rule may reduce the designated export quantity. It is assumed, however, 
that the impact will not be so large as to diminish designated exports 
below the 2000 import quantity, because exporters will likely attempt 
to maintain established export market infrastructures.
    There was a significant increase in U.S. clementine imports from 
Spain between 1998 and 1999 that may have been due, in part, to the 
establishment of market infrastructures in 1999. It is not clear what 
effect the proposed rule may have on the future development of this 
infrastructure; however, for the short run we assume that the most 
likely scenario involves no change from 2000 levels. As a result, our 
most likely quantity for designated exports in 2002 is based on the 
rate of growth in U.S. imports between 1999 and 2000, approximately 
7.65 percent. Finally, we

[[Page 45931]]

examine a maximum quantity for designated exports based on the average 
annual rate of growth of imports during 1989-2001, at approximately 39 
percent.
    Benefits to importers, wholesalers, and retail consumers associated 
with the proposed rule are estimated using areas under demand curves 
bounded by prices paid, assuming wholesalers purchase all clementines 
purchased by importers and retail consumers purchase all clementines 
purchased by wholesalers. Demand curves for each sector have not been 
estimated in the literature, and available data were not sufficient to 
estimate precisely demand curves for any of the sectors. Therefore, an 
iterative procedure is used to specify linear demand curves for each 
sector to obtain approximate measures of economic welfare. A detailed 
discussion of the methodology for estimating demand curves can be found 
in the economic analysis accompanying the proposed rule.
    For marketing season 2000, estimates of gross revenues minus 
payments on clementines for importers and wholesalers in the United 
States are approximately $105 million and $53 million, respectively. 
The estimate for retail consumer benefits in 2000 is an additional $26 
million. Benefits associated with lifting the ban under the proposed 
rule for marketing season 2002 are estimated in a similar manner, 
except the provisions of the proposed rule are used to estimate final 
import quantities and prices. Expected imports are given by designated 
exports minus expected fruit loss due to fruit cuttings and rejected 
shipments in Spain and in the United States. Given expected import 
levels, we estimate import prices and benefits, wholesale prices and 
benefits, and retail prices and consumer benefits. For the most likely 
designated export quantity (90,032 metric tons), estimates of gross 
revenues less payments on clementines for importers and wholesalers are 
$120 million and $60 million, respectively. The estimate for retail 
consumer benefits is an additional $30 million.

Net Impact of the Proposed Rule

    Relative to the current ban, net welfare impacts associated with 
the proposed rule are positive for each designated export quantity. 
Under the most likely designated export quantity, expected welfare 
gains associated with the proposed rule are approximately $210 million 
for marketing season 2002, which includes approximately $120, $60, and 
$30 million in estimated welfare gains for importers, wholesalers, and 
retail consumers, with practically no increase in expected costs to 
U.S. taxpayers and fruit and vegetable producers.
    Estimated net welfare effects relative to the previous import 
program are approximately $26 million under the most likely designated 
export quantity scenario. In this case, importers, wholesalers, and 
retail consumers are expected to be better off under the proposed rule, 
because the expected amount of clementines ultimately imported into the 
United States during marketing season 2002 exceeds the amount imported 
in 2000. These results indicate that net welfare effects associated 
with the proposed rule will likely be positive relative to either 
baseline. If clementine imports increase and clementines substitute for 
domestically produced tangerines; however, benefits would be reduced 
due to profit losses experienced by U.S. tangerine producers.

Analysis of the Economic Effects on Small Entities

    There are approximately 15 Spanish clementine importers in the 
United States, three of which import the majority of clementines 
(Sibley 2002). In addition, individuals in foreign countries own at 
least two of the import companies in this list. The U.S. Small Business 
Administration defines a small clementine importer (NAICS 42248 Fresh 
Fruit and Vegetable Wholesalers) as one with annual sales receipts of 
$100 million or less. As a result, approximately 13 small importers may 
be affected by the proposed rule. The number of small wholesalers 
potentially affected by the proposed rule is not known. These entities 
include supermarkets and other grocery stores (NAICS 445110) with 
annual sales receipts of $23 million or less, warehouse clubs and 
superstores (NAICS 452910) with annual sales receipts of $23 million or 
less, and fruit and vegetable markets (NAICS 445230) with annual sales 
receipts of $6 million or less.
    Because the percentage of income derived from the sale of 
clementines by wholesalers is likely to be low, the proposed rule will 
not likely have a significant negative impact on a substantial number 
of small wholesalers relative to either baseline. In addition, small 
importers and wholesalers will likely be better off under the proposed 
rule relative to the current ban and, when designated exports are at or 
above the most likely value, better off under the proposed rule 
relative to the previous import program as well. As a result, the 
proposed rule will not have a significant impact on any small importers 
and wholesalers in the United States relative to the current ban, and 
the proposed rule will likely not have a significant negative impact on 
a substantial number of small importers relative to the previous import 
program.
    Under these circumstances, the Administrator of the Animal and 
Plant Health Inspection Service has determined that this action would 
not have a significant economic impact on a substantial number of small 
entities.

Executive Order 12988

    This proposed rule would allow clementines to be imported into the 
United States from Spain. If this proposed rule is adopted, State and 
local laws and regulations regarding clementines imported under this 
rule would be preempted while the fruit is in foreign commerce. Fresh 
clementines are generally imported for immediate distribution and sale 
to the consuming public and would remain in foreign commerce until sold 
to the ultimate consumer. The question of when foreign commerce ceases 
in other cases must be addressed on a case-by-case basis. If this 
proposed rule is adopted, no retroactive effect will be given to this 
rule, and this rule will not require administrative proceedings before 
parties may file suit in court challenging this rule.

Paperwork Reduction Act

    In accordance with section 3507(d) of the Paperwork Reduction Act 
of 1995 (44 U.S.C. 3501 et seq.), the information collection or 
recordkeeping requirements included in this proposed rule have been 
submitted for approval to the Office of Management and Budget (OMB). 
Please send written comments to the Office of Information and 
Regulatory Affairs, OMB, Attention: Desk Officer for APHIS, Washington, 
DC 20503. Please state that your comments refer to Docket No. 02-023-3. 
Please send a copy of your comments to: (1) Docket No. 02-023-3, 
Regulatory Analysis and Development, PPD, APHIS, Station 3C71, 4700 
River Road Unit 118, Riverdale, MD 20737-1238, and (2) Clearance 
Officer, OCIO, USDA, room 404-W, 14th Street and Independence Avenue 
SW., Washington, DC 20250. A comment to OMB is best assured of having 
its full effect if OMB receives it within 30 days of publication of 
this proposed rule.
    We are soliciting comments from the public (as well as affected 
agencies) concerning our proposed information collection and 
recordkeeping requirements. These comments will help us:
    (1) Evaluate whether the proposed information collection is 
necessary for

[[Page 45932]]

the proper performance of our agency's functions, including whether the 
information will have practical utility;
    (2) Evaluate the accuracy of our estimate of the burden of the 
proposed information collection, including the validity of the 
methodology and assumptions used;
    (3) Enhance the quality, utility, and clarity of the information to 
be collected; and
    (4) Minimize the burden of the information collection on those who 
are to respond (such as through the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques or 
other forms of information technology; e.g., permitting electronic 
submission of responses).
    Estimate of burden: Public reporting burden for this collection of 
information is estimated to average 0.014 hours per response.
    Respondents: Full-time, salaried plant health officials of Spain's 
plant protection service, and growers and shippers of clementines.
    Estimated annual number of respondents: 37.
    Estimated annual number of responses per respondent: 216,303.
    Estimated annual number of responses: 8,003,200.
    Estimated total annual burden on respondents: 113,200 hours. (Due 
to averaging, the total annual burden hours may not equal the product 
of the annual number of responses multiplied by the reporting burden 
per response.)
    Copies of this information collection can be obtained from Mrs. 
Celeste Sickles, APHIS' Information Collection Coordinator, at (301) 
734-7477.

List of Subjects

7 CFR Part 300

    Incorporation by reference, Plant diseases and pests, Quarantine.

7 CFR Part 319

    Bees, Coffee, Cotton, Fruits, Honey, Imports, Incorporation by 
reference, Nursery Stock, Plant diseases and pests, Quarantine, 
Reporting and recordkeeping requirements, Rice, Vegetables.

    Accordingly, we propose to amend 7 CFR parts 300 and 319 as 
follows:

PART 300--INCORPORATION BY REFERENCE

    1. The authority citation for part 300 would continue to read as 
follows:

    Authority: 7 U.S.C. 7701-7772; 7 CFR 2.22, 2.80, and 371.3.

    2. In Sec. 300.1, a new paragraph (a)(5) would be added as follows:


Sec. 300.1  Materials incorporated by reference.

    (a) * * *
    (5) Treatment T107-a, dated ________.
* * * * *

PART 319--FOREIGN QUARANTINE NOTICES

    3. The authority citation for part 319 would continue to read as 
follows:

    Authority: 7 U.S.C. 166, 450, 7711-7714, 7718, 7731, 7732, and 
7751-7754; 21 U.S.C. 136 and 136a; 7 CFR 2.22, 2.80, and 371.3.

    4. A new Sec. 319.56-2jj would be added to read as follows:


Sec. 319.56-2jj  Administrative instructions; conditions governing the 
importation of clementines from Spain.

    Clementines (Citrus reticulata) from Spain may only be imported 
into the United States in accordance with the regulations in this 
section.
    (a) Trust fund agreement. Clementines from Spain may be imported 
only if the Government of Spain or its designated representative enters 
into a trust fund agreement with the Animal and Plant Health Inspection 
Service (APHIS) before each shipping season. The Government of Spain or 
its designated representative is required to pay in advance all 
estimated costs that APHIS expects to incur through its involvement in 
overseeing the execution of paragraphs (b) through (g) of this section. 
These costs will include administrative expenses incurred in conducting 
the services enumerated in paragraphs (b) through (g) of this section 
and all salaries (including overtime and the Federal share of employee 
benefits), travel expenses (including per diem expenses), and other 
incidental expenses incurred by the inspectors in performing these 
services. The Government of Spain or its designated representative is 
required to deposit a certified or cashier's check with APHIS for the 
amount of the costs estimated by APHIS. If the deposit is not 
sufficient to meet all costs incurred by APHIS, the agreement further 
requires the Government of Spain or its designated representative to 
deposit with APHIS a certified or cashier's check for the amount of the 
remaining costs, as determined by APHIS, before the services will be 
completed. After a final audit at the conclusion of each shipping 
season, any overpayment of funds would be returned to the Government of 
Spain or its designated representative or held on account until needed.
    (b) Grower registration and agreement. Persons who produce 
clementines in Spain for export to the United States must:
    (1) Be registered with the Government of Spain; and
    (2) Enter into an agreement with the Government of Spain whereby 
the producer agrees to participate in and follow the Mediterranean 
fruit fly management program established by the Government of Spain.
    (c) Management program for Mediterranean fruit fly; monitoring. The 
Government of Spain's Mediterranean fruit fly management program must 
be approved by APHIS, and must contain the fruit fly trapping and 
recordkeeping requirements specified in this paragraph. The program 
must also provide that clementine producers must allow APHIS inspectors 
access to clementine production areas in order to monitor compliance 
with the Mediterranean fruit fly management program.
    (1) Trapping and control. In areas where clementines are produced 
for export to the United States, traps must be placed in Mediterranean 
fruit fly preferred host plants at least 6 weeks prior to harvest. Bait 
treatments using malathion, spinosad, or another pesticide approved by 
APHIS must be applied in the production areas at a rate appropriate to 
maintain the level of infestation of clementines by Mediterranean fruit 
flies at 1.5 percent or less.
    (2) Records. The Government of Spain or its designated 
representative must keep records that document the fruit fly trapping 
and control activities in areas that produce clementines for export to 
the United States. All trapping and control records kept by the 
Government of Spain or its designated representative must be made 
available to APHIS upon request.
    (d) Phytosanitary certificate. Clementines from Spain must be 
accompanied by a phytosanitary certificate stating that the fruit meets 
the conditions of the Government of Spain's Mediterranean fruit fly 
management program and applicable APHIS regulations.
    (e) Labeling. Cartons in which clementines are packed must be 
labeled with a lot number that provides information to identify the 
orchard where the fruit was grown and the packinghouse where the fruit 
was packed. The lot number must end with the letters ``US.'' Such 
labeling must be large enough to clearly display the required 
information and must be located on the side of the cartons to 
facilitate inspection.
    (f) Pre-treatment sampling; rates of inspection. For each shipment 
of clementines intended for export to the United States, prior to cold 
treatment,

[[Page 45933]]

APHIS inspectors will cut and inspect fruit that are randomly selected 
from throughout the shipment at a rate designated in this paragraph. If 
inspectors find a single live Mediterranean fruit fly in any stage of 
development during an inspection, the entire shipment of clementines 
will be rejected. If a live Mediterranean fruit fly in any stage of 
development is found in any two shipments of fruit from the same 
orchard during the same shipping season, that orchard will be removed 
from the export program for the remainder of that shipping season.
    (1) For the first clementine shipping season that occurs after the 
effective date of this rule, inspectors will cut 200 randomly selected 
fruit per shipment.
    (2) For all further shipping seasons, inspectors will cut fruit 
according to the following table, except as noted in paragraph (f)(3) 
of this section:

------------------------------------------------------------------------
                                                          . . . then the
 If the sample size for a given       . . . and the      sample size for
          season is--             rejection rate during  the next season
                                    that season is--           is--
------------------------------------------------------------------------
200............................  5 percent..              100
                                 >5 percent............              200
100............................  2 percent..               76
                                 >2 percent but 5 percent.
                                 >5 percent............              200
76.............................  2 percent..               76
                                 >2 percent but 5 percent.
                                 >5 percent............              200
------------------------------------------------------------------------

    (3) If APHIS determines that fruit presented for inspection and 
treatment appear to be highly infested during a shipping season in 
which 100 or 76 fruit are cut per shipment, APHIS reserves the right to 
increase the required sample size during the shipping season. At no 
time will more than 200 fruit be required to be cut, but the sample 
size could be raised to that level at APHIS's discretion.
    (g) Cold treatment. Clementines must be cold treated in accordance 
with the Plant Protection and Quarantine (PPQ) Treatment Manual, which 
is incorporated by reference at Sec. 300.1 of this chapter. Upon 
arrival of clementines at a port of entry into the United States, APHIS 
inspectors will examine the cold treatment data for each shipment to 
ensure that the cold treatment was successfully completed. If the cold 
treatment has not been successfully completed, the shipment will be 
held until appropriate remedial actions have been implemented.
    (h) Port of entry sampling. Clementines imported from Spain are 
subject to inspection by an inspector at the port of entry into the 
United States. At the port of first arrival, an inspector will sample 
and cut clementines from each shipment to detect pest infestation 
according to sampling rates determined by the Administrator. If a 
single live Mediterranean fruit fly in any stage of development is 
found, the shipment will be held until an investigation is completed 
and appropriate remedial actions have been implemented. If APHIS 
determines at any time that the safeguards contained in this section 
are not protecting against the introduction of Medflies into the United 
States, APHIS may suspend the importation of clementines and conduct an 
investigation into the cause of the deficiency.
    (i) Shipping season. For the purposes of this section, a shipping 
season is considered to include the period beginning approximately in 
mid-September and ending approximately in late February of the next 
calendar year.

    Done in Washington, DC, this 8th day of July 2002.
Bill Hawks,
Under Secretary for Marketing and Regulatory Programs, USDA.
[FR Doc. 02-17431 Filed 7-8-02; 3:26 pm]
BILLING CODE 3410-34-U