[Federal Register Volume 68, Number 6 (Thursday, January 9, 2003)]
[Proposed Rules]
[Pages 1169-1170]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-369]


 ========================================================================
 Proposed Rules
                                                 Federal Register
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 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.
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  Federal Register / Vol. 68, No. 6 / Thursday, January 9, 2003 / 
Proposed Rules  

[[Page 1169]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 56

[Docket No. PY-02-007]
RIN 0581-AC24


Requirements for the USDA ``Produced From'' Grademark for Shell 
Eggs

AGENCY: Agricultural Marketing Service, (USDA).

ACTION: Proposed rule.

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SUMMARY: The Agricultural Marketing Service (AMS) proposes to amend the 
regulations governing the voluntary shell egg grading program by 
clarifying the requirements for using the ``Produced From'' grademark 
for shell eggs. Use of this grademark began in April 1998. Since then, 
questions have arisen regarding the regulatory language. This proposal 
would clarify the language of the ``Produced From'' grademark 
requirements in the regulations by removing the reference to continuous 
supervision.

DATES: Comments must be received on or before March 10, 2003.

ADDRESSES: Send written comments to David Bowden, Jr., Chief, 
Standardization Branch, Poultry Programs, Agricultural Marketing 
Service, U.S. Department of Agriculture, STOP 0259, Room 3944-South, 
1400 Independence Avenue, SW., Washington, DC 20250-0259. Comments may 
be faxed to (202) 690-0941.
    State that your comments refer to Docket No. PY-02-007 and note the 
date and page number of this issue of the Federal Register.
    Comments received may be inspected at the above location between 8 
a.m. and 4:30 p.m., Eastern Time, Monday through Friday, except 
holidays.

FOR FURTHER INFORMATION CONTACT: Rex A. Barnes, Chief, Grading Branch, 
(202) 720-3271.

SUPPLEMENTARY INFORMATION: 

Background

    AMS administers a voluntary grading program for shell eggs under 
the Agricultural Marketing Act of 1946, as amended (7 U.S.C. 1621 et 
seq.). Any interested person, commercial firm, or government agency 
that applies for service must comply with the terms and conditions of 
the regulations and must pay for the services rendered. AMS graders 
monitor processing operations and verify the grade and size of eggs 
packed into packages bearing the USDA grademark.
    Current regulations allow for the use of several different 
grademarks to identify consumer-pack USDA graded shell eggs or products 
prepared from them. The regulations also include the eligibility 
requirements for eggs to be identified with an official grademark.

Proposed Changes

    A ``Produced From'' grademark was added to the regulations, 
effective April 20, 1998 (63 FR 13329, March 19, 1998). As currently 
written, the regulations state that the ``Produced From'' grademark may 
be used to identify products for which there are no official U.S. grade 
standards (e.g., pasteurized shell eggs), provided that these products 
are approved by the Agency and are prepared from U.S. Consumer Grade AA 
or A shell eggs under the continuous supervision of a grader.''
    The intent of the regulations was to ensure that the eggs used to 
produce the products were U.S. Consumer Grade AA or A. One of the 
requirements for eggs to be identified with an official grademark is 
that the eggs be graded under the supervision of a grader.
    The regulations could be interpreted to mean that the products that 
are produced from the U.S. Consumer Grade AA or A shell eggs must also 
be produced under continuous supervision. However, this was not the 
Department's intent.
    The Agency has determined that in order to clarify the regulatory 
language, the reference to continuous supervision regarding the 
``Produced From'' grademark should be removed.

Executive Order 12866

    This proposed rule has been determined to be not significant for 
purposes of Executive Order 12866 and, therefore, has not been reviewed 
by the Office of Management and Budget (OMB).

Regulatory Flexibility

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601 et seq.), the AMS has considered the economic 
impact of this proposed rule on small entities and has determined that 
its provisions would not have a significant economic impact on a 
substantial number of small entities.
    The purpose of the RFA is to fit regulatory actions to the scale of 
businesses subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened. The Small Business 
Administration defines small entities that produce and process chicken 
eggs as those whose annual receipts are less than $9,000,000 (13 CFR 
121.201). Approximately 625,000 egg laying hens are needed to produce 
enough eggs to gross $9,000,000.
    Currently, the Agricultural Marketing Act of 1946, as amended (7 
U.S.C. 1621 et seq.) authorizes a voluntary grading program for shell 
eggs. Shell egg processors that apply for service must pay for the 
services rendered. These user fees are proportional to the volume of 
shell eggs graded, so that costs are shared by all users. Plants in 
which these grading services are performed are called official plants. 
Shell egg processors who do not use USDA's grading service may not use 
the USDA grade shield. There are about 625 shell egg processors 
registered with the Department that have 3,000 or more laying hens. Of 
these, 175 are official plants that use USDA's grading service and 
would be subject to this proposed rule. Of these 175 official plants, 
57 meet the small business definition.
    This proposed amendment would benefit the processors in the 
industry, both large and small. It is intended to clarify a regulatory 
provision which has caused some confusion and involves no additional 
costs.

Executive Orders 12988

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. It is not intended to have retroactive effect. 
This rule will not preempt any State or local laws, regulations, or 
policies, unless they present an irreconcilable conflict with

[[Page 1170]]

this rule. There are no administrative procedures that must be 
exhausted prior to any judicial challenge to the provisions of this 
rule.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
3501 et seq.), the Office of Management and Budget (OMB) has approved 
the information collection and recordkeeping requirements included in 
this rule, and there are no new requirements. The assigned OMB control 
number is 0581-0128.

List of Subjects in 7 CFR Part 56

    Eggs and egg products, Food grades and standards, Food labeling, 
Reporting and recordkeeping requirements.
    For reasons set forth in the preamble, it is proposed that 7 CFR 
part 56 be amended as follows:

PART 56--VOLUNTARY GRADING OF SHELL EGGS

    1. The authority citation for part 56 continues to read as follows:

    Authority: 7 U.S.C. 1621-1627.


Sec.  56.36  [Amended]

    2. In Sec.  56.36, paragraph (a)(3) is amended by adding a period 
after the word ``eggs'' the second time it appears in the paragraph and 
by removing the words ``under the continuous supervision of a grader.''

    Dated: December 26, 2002.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 03-369 Filed 1-8-03; 8:45 am]
BILLING CODE 3410-02-P