[Federal Register Volume 68, Number 197 (Friday, October 10, 2003)]
[Rules and Regulations]
[Pages 58974-59077]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-25877]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Part 1

[Docket No. 02N-0278]
RIN 0910-AC41


Prior Notice of Imported Food Under the Public Health Security 
and Bioterrorism Preparedness and Response Act of 2002

AGENCY: Food and Drug Administration, HHS.

ACTION: Interim final rule; request for comments.

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SUMMARY: The Food and Drug Administration (FDA) is issuing an interim 
final regulation that requires the submission to FDA of prior notice of 
food, including animal feed, that is imported or offered for import 
into the United States. The interim final rule implements the Public 
Health Security and Bioterrorism Preparedness and Response Act of 2002 
(the Bioterrorism Act), which requires prior notification of imported 
food to begin on December 12, 2003, even in the absence of a final 
regulation. The interim final rule requires that the prior notice be 
submitted to FDA electronically via either the Bureau of Customs and 
Border Protection (CBP) Automated Broker Interface (ABI) of the 
Automated Commercial System (ACS) or the FDA Prior Notice System 
Interface (FDA PN System Interface). The information must be submitted 
and confirmed electronically as facially complete by FDA for review no 
more than 5 days and no less than 8 hours (for food arriving by water), 
4 hours (for food arriving by air or land/rail), and 2 hours (for food 
arriving by land/road) before the food arrives at the port of arrival. 
Food imported or offered for import without adequate prior notice is 
subject to refusal and, if refused, must be held.

DATES: This interim final rule is effective December 12, 2003. Submit 
written or electronic comments by December 24, 2003.

ADDRESSES: Submit written comments to the Division of Dockets 
Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane, 
rm. 1061, Rockville, MD 20852. Submit electronic comments to http://www.fda.gov/dockets/ecomments.

FOR FURTHER INFORMATION CONTACT: Deborah Ralston, Office of Regulatory 
Affairs, Office of Regional Operations, Food and Drug Administration, 
5600 Fishers Lane, Rockville, MD 20857, 301-443-6230.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Background
    A. Current Process--Admissibility Determinations Under Section 
801(a) of the FD&C Act
    B. Process After December 12, 2003--Prior Notice Determination 
Followed by Admissibility Determination
II. Overview of the Interim Final Rule and Significant Changes Made 
to the Proposed Rule
    A. ``What Definitions Apply to This Subpart?'' (Section 1.276 
Proposed as Sec.  1.277)
    B. ``What is the Scope of This Subpart?'' (Section 1.277 
Proposed as Sec.  1.276)
    C. ``Who Is Authorized to Submit Prior Notice?'' (Section 1.278 
Proposed as Sec.  1.285)
    D. ``When Must Prior Notice Be Submitted to FDA?'' (Section 
1.279 Proposed as Sec.  1.286)
    E. ``How Must You Submit Prior Notice?'' (Section 1.280 Proposed 
as Sec.  1.287)
    F. ``What Information Must Be in a Prior Notice?'' (Section 
1.281 Proposed as Sec.  1.288)
    G. ``What Must You Do If Information Changes After You Have 
Received Confirmation of a Prior Notice From FDA?'' (Section 1.282 
Proposed Sec. Sec.  1.289 to 1.294)
    H. ``What Happens to Food That Is Imported or Offered for Import 
Without Adequate Prior Notice?'' (Section 1.283 Proposed as Sec.  
1.278)
    I. ``What Are the Other Consequences of Failing to Submit 
Adequate Prior Notice or Otherwise Failing to Comply With This 
Subpart?'' (Section 1.284 Proposed as Sec.  1.278)
    J. ``What Happens to Food That Is Imported or Offered for Import 
from Unregistered Facilities That Are Required to Register Under 21 
CFR Part 1, Subpart H?'' (Section 1.285)
III. Comments on the Proposed Rule
    A. General Comments and Outreach
    B. Foreign Trade Issues
    C. ``What Definitions Apply to This Subpart?'' (Section 1.276 
Proposed as Sec.  1.277)
    D. ``What Is the Scope of This Subpart?'' (Section 1.277 
Proposed as Sec.  1.276)
    E. ``Who Is Authorized to Submit Prior Notice?'' (Section 1.278 
Proposed as Sec.  1.285)
    F. ``When Must Prior Notice Be Submitted to FDA?'' (Section 
1.279 Proposed as Sec.  1.286)
    G. ``How Must You Submit Prior Notice?'' (Section 1.280 Proposed 
as Sec.  1.287)
    H. ``What Information Must Be in a Prior Notice?'' (Section 
1.281 Proposed as Sec.  1.288)
    I. ``What Must You Do If Information Changes After You Have 
Received Confirmation of a Prior Notice From FDA?'' (Section 1.282 
Proposed as Sec. Sec.  1.289 to 1.294)
    J. ``What Happens to Food That Is Imported or Offered for Import 
Without Adequate Prior Notice?'' (Section 1.283) and ``What Are the 
Other Consequences of Failing to Submit Adequate Prior Notice or 
Otherwise Failing to Comply With This Subpart?'' (Sec.  1.284 
Proposed as Sec.  1.278)
    K. ``What Happens to Food That Is Imported or Offered for Import 
From Unregistered Facilities That Are Required to Register Under 
Section 415 of the FD&C Act, 21 U.S.C. 350d and 21 CFR Part 1, 
Subpart H?'' (Section 1.285)
IV. Issuance of an Interim Final Rule and Effective Date; Comments
V. Analysis of Economic Impacts
    A. Final Regulatory Impact Analysis
    1. Need for Regulation
    2. Interim Final Rule Coverage
    3. Regulatory Options Considered
    4. Summary of Options
    5. Benefits
    B. Small Entity Analysis (or Final Regulatory Flexibility 
Analysis)
    1. Number of Establishments Affected
    2. Costs per Entity
    3. Additional Flexibility Considered
    C. Unfunded Mandates
    D. Small Business Regulatory Enforcement Fairness Act (SBREFA) 
Major Rule
VI. Paperwork Reduction Act of 1995
VII. Analysis of Environmental Impact
VIII. Federalism
IX. References

I. Background

    In the Federal Register of February 3, 2003 (68 FR 5428), the 
Department of Health and Human Services (FDA) and the Department of 
Treasury (U.S. Customs Service) issued a joint notice of proposed 
rulemaking requiring submission to FDA of prior notice of human and 
animal food that is imported or offered for import into the United 
States. The events of September 11, 2001, had highlighted the need to 
ensure that FDA had additional tools to help prevent a food-related 
bioterrorism event or other public health emergency. Congress responded 
by passing the Public Health Security and Bioterrorism Preparedness and 
Response Act of 2002 (the Bioterrorism Act) (Pub. L. 107-188), which 
was signed into law on June 12, 2002. The Bioterrorism Act includes a 
provision in Title III (Protecting Safety and Security of Food and Drug 
Supply), Subtitle A'Protection of Food Supply, section 307, which 
changes when FDA will receive certain information about imported foods 
by requiring the Secretary of Health and Human Services (the 
Secretary), after consultation with the Secretary of the Treasury, to 
issue an implementing regulation by December 12, 2003, to require prior 
notification to FDA of food that is imported or offered for import into 
the United States. Under

[[Page 58975]]

the Homeland Security Act of 2002 (Pub. L. 107-296), the Secretary of 
the Treasury has delegated all relevant Customs revenue authorities to 
the Secretary of Homeland Security who has, in turn, delegated them to 
the Commissioner of the Bureau of Customs and Border Protection (CBP or 
Customs). Thus, we are issuing this interim final rule jointly with the 
Secretary of Homeland Security.
    Section 307 of the Bioterrorism Act amends the Federal Food, Drug, 
and Cosmetic Act (the FD&C Act) by adding section 801(m) (21 U.S.C. 
381(m)) and amending section 301 (21 U.S.C. 331). (In the regulation 
itself, which is codified in Title 21 of the Code of Federal 
Regulations, the Federal Food, Drug, and Cosmetic Act is referred to as 
``the act.'' Thus, when the regulation is quoted in this preamble the 
term ``the act'' will be used to refer to the Federal Food, Drug, and 
Cosmetic Act. However, in this preamble we refer to the Federal Food, 
Drug, and Cosmetic Act as ``the FD&C Act'' in the preamble to 
distinguish it from the Bioterrorism Act.)
    The Bioterrorism Act also requires FDA to issue regulations 
requiring certain food establishments to register with FDA (section 
305), directs FDA to issue regulations regarding maintenance of certain 
records (section 306), and grants FDA the authority to administratively 
detain food (section 303). FDA has published proposed rules 
implementing section 305 of the Bioterrorism Act (68 FR 5378, February 
3, 2003), section 303 of the Bioterrorism Act (68 FR 25242, May 9, 
2003), and section 306 of the Bioterrorism Act (68 FR 25188, May 9, 
2003). The interim final rule implementing the food facility 
registration requirements is published elsewhere in this issue of the 
Federal Register.

A. Current Process--Admissibility Determinations Under Section 801(a) 
of the FD&C Act

    Section 801(a) of the FD&C Act sets out current standards and 
procedures for FDA review of imports under its jurisdiction. Section 
801(a) provides for examination of imports and also authorizes FDA to 
refuse admission of imports that appear, from examination or otherwise, 
to be, inter alia, adulterated or misbranded. When an FDA-regulated 
product is imported, generally customs brokers submit entry information 
to CBP on behalf of the importers of record. CBP then provides entry 
information to FDA to enable admissibility decisions to be made. Under 
CBP authorities, entry of the merchandise can be made up to 15 days 
after arrival.
    CBP regulations provide for different kinds of entries. Commonly, 
merchandise is the subject of an entry for consumption or warehouse 
(i.e., unrestricted, general use) under a basic importation and entry 
bond at the port of arrival. A warehouse entry is a CBP entry procedure 
as described in 19 CFR part 144. It allows imported product (with some 
restrictions) to be entered without payment of duty, provided it is 
kept in a bonded warehouse and not distributed. CBP authorities also 
allow for an Immediate Transportation or IT entry of merchandise for 
transportation under a custodial bond from the port of arrival to 
another port where the consumption or warehouse entry will be made or 
the product will be admitted into a foreign trade zone (FTZ) located 
outside of the port area. In addition, if the merchandise is going to 
an FTZ in the port area, FTZ admission documents are presented to CBP. 
Finally, a transportation and exportation (or T&E) entry may be filed 
if the merchandise is to be transshipped from the port of arrival 
through the United States to another port for export.
    FDA currently receives electronic information about entries from 
CBP through CBP's ABI of the ACS. FDA receives this information through 
its Operational and Administrative System for Import Support (OASIS). 
The entry types currently transmitted through the ABI/ACS interface 
with OASIS include consumption entries and warehouse entries but not IT 
entries, T&E entries, or admissions into FTZs. The customs broker or 
self-filer electronically submits entry information to ABI/ACS, 
including: The identification of the product by the Harmonized Tariff 
Schedule (HTS) code; the entry type; the entry number (including both 
the ACS line number and the FDA line number); the arrival date; the 
port; the port of unlading; the carrier code; the vessel name and 
voyage, flight or trip number; importer and ultimate consignee; the 
quantity; value; country of origin; bill of lading or airway bill 
number; the manufacturer; the importer of record; and the ultimate 
consignee. The HTS codes are flagged to indicate which products will 
require FDA review; all FDA-regulated products are covered, not just 
foods. The additional information that is currently transmitted through 
the ABI/ACS interface to FDA includes: The FDA manufacturer; the FDA 
shipper, the FDA Country of Production (country of origin); the 
complete FDA product code; a description of the food in common business 
terms; the quantity for each FDA line, and, as ``Affirmations of 
Compliance,'' information specific to certain products, such as the 
Food Canning Establishment (FCE) Number.\1\ CBP regulations do not 
mandate electronic transmission of entry information; therefore, some 
entries are filed in paper. If a ``paper'' entry is filed, it is 
customary for CBP to require that copies of entry documentation by 
submitted to FDA. The entry documents contain the same information as 
the electronic filing, typically the information required on CBP's 
Entry/Immediate Delivery (CF3461), and a copy of the foreign invoice. 
The paper entries may be presented at the time of arrival or after.
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    \1\ Affirmations of Compliance are data elements that a customs 
broker or self-filer currently uses when transmitting certain 
information to FDA through ABI/ACS to OASIS. Each provides a 
mechanism to indicate (or affirm) compliance with a specific FDA 
regulatory requirement.
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    After information is transmitted from ABI/ACS, OASIS performs 
additional validations on the data. If no corrections from the customs 
broker or self-filer are needed, it screens the entry information 
against FDA admissibility criteria. If the FDA electronic review 
determines that further evaluation of the information or article of 
food is not necessary, the system transmits a message back through the 
FDA/CBP interface that the article of food ``may proceed without FDA 
examination.'' If further evaluation is necessary, FDA staff will 
review the entry information and may request additional information 
necessary to make an admissibility determination or may examine or 
sample the product. Section 801(b) of the FD&C Act provides for the 
release of FDA regulated products to the importer or owner, under bond, 
before the FDA admissibility decision is made. Accordingly, FDA 
examination may take place at a location to which the product has been 
moved. Because there are no restrictions on movement, the product may 
be at the border, within the confines of a port, at a public storage 
facility in the vicinity of the importer, or at the ultimate 
consignee's warehouse. Finally, if the FDA electronic review indicates 
that the product appears ``by examination or otherwise'' to be subject 
to refusal of admission under section 801(a) of the FD&C Act (e.g., 
appears to be adulterated or misbranded), the FDA reviewer will 
evaluate the entry information based on FDA guidance, take appropriate 
action, and notify the importer as well as the customs broker.
    Under current laws and regulations, FDA may receive the information 
about some food imports some days after the food has arrived in the 
United States,

[[Page 58976]]

has been moved from the port of arrival, and has been delivered to the 
ultimate consignee. While FDA may ultimately receive electronic entry 
notification of IT entries when the consumption entry is later filed, 
FDA does not receive electronic notification with information about 
food entered for transshipment for export or when the food is admitted 
to an FTZ.
    The admissibility standard in section 801(a) of the FD&C Act 
largely focuses on whether the article of food appears to have been 
safely produced, contains no contaminants or illegal additives or 
residues, and is properly labeled. Section 801(a) provides that an 
article of food is subject to refusal of admission if it ``appears, 
from physical examination or otherwise': (1) To have been manufactured, 
processed, or packed under insanitary conditions; (2) to be forbidden 
or restricted in sale in the country in which it was produced or from 
which it was exported; or (3) to be adulterated or misbranded. The food 
adulteration and misbranding provisions (sections 402 and 403 of the 
FD&C Act) set out most of the FD&C Act's safety and labeling standards 
for foods.

B. Process After December 12, 2003--Prior Notice Determination Followed 
by Admissibility Determination

    Section 801(m) provides that an article of food is subject to 
refusal of admission if adequate prior notice has not been provided to 
FDA. Thus, the refusal standard in section 801(m) focuses in the first 
instance on whether the requisite information has been provided in a 
timely fashion, while the refusal standard in section 801(a) focuses on 
whether the article was safely produced, contains no contaminants or 
illegal additives or residues, and is properly labeled.
    By adding the prior notice requirement to the FD&C Act, Congress, 
in the Bioterrorism Act, changed when information about FDA-regulated 
food imports must be provided to FDA and what happens if the 
information is not provided. The prior notice provisions require that 
notice must be provided on imported food shipments to FDA before 
arrival. If adequate notice is not provided, section 801(m) of the FD&C 
Act provides that the food is subject to refusal, and that refused food 
must be held until adequate notice is given and may not be delivered to 
the importer, owner, or consignee. The stated purpose of requiring 
notice of imported food shipments before arrival in the United States 
is to enable FDA to conduct inspections of imported food at U.S. ports 
(see section 801(m)(1) of the FD&C Act). Thus, FDA intends to use prior 
notice information to make decisions about which inspections to conduct 
at the time of arrival. Currently, we intend to focus on conducting 
these inspections when our information suggests the potential for a 
significant risk to public health.
    As explained in greater detail in the following paragraphs, FDA and 
CBP are coordinating FDA's new prior notice requirements with CBP's and 
FDA's existing entry requirements to the greatest extent possible. 
Thus, the interim final rule allows prior notice to be submitted 
electronically to FDA through either ABI/ACS or the FDA Prior Notice 
(PN) System Interface. The HTS codes will be flagged within ABI/ACS to 
indicate which HTS codes contain foods subject to prior notice 
requirements. In addition, the ABI/ACS interface will provide a new 
transaction for transmission of prior notice information on IT and T&E 
entries, and FTZ admissions, e.g., the types of entries of which FDA 
was not aware or did not know about until many days after arrival in 
the United States. This will allow for FDA electronic screening and FDA 
staff evaluation of the information so that FDA can assess, before the 
food arrives, whether to inspect and to be prepared to conduct that 
inspection upon arrival.
    FDA expects approximately 90 percent of prior notice submissions 
for all importations of foods to be transmitted by a customs broker or 
self-filer through the ABI/ACS interface to FDA. FDA estimates that 
only 10 percent (or less) of the total importations cannot be 
accommodated by the ABI/ACS interface and, therefore, will be submitted 
via the FDA PN System Interface.
    In addition to requiring submission of the information currently 
sent to FDA for admissibility determinations, information identifying 
the grower (if known), the country from which the article is shipped, 
and anticipated arrival information is also required for prior notice. 
If all of the prior notice information is transmitted through the ABI/
ACS interface, no additional transmission of information for 
admissibility determinations under section 801(a) of the FD&C Act will 
be necessary. If prior notice is submitted through the FDA PN System 
Interface, additional transmission through ABI/ACS may be necessary for 
CBP purposes and FDA's admissibility evaluation.
    Regardless of the mode of transmission, the prior notice 
information will undergo both a validation process and screening in 
OASIS for food safety and security criteria. After the validation step 
is complete, the prior notice will be confirmed by FDA for review and a 
reply message sent to the transmitter indicating the prior notice has 
been received and confirmed for FDA review. The form of this reply 
messaging depends upon the mode of initial transmission: ABI/ACS or FDA 
PN System Interface. The clock starts for determining if prior notice 
was timely when this prior notice confirmation message is sent by FDA.
    If the FDA system does not indicate that further evaluation of or 
action on the notice or article of food is necessary for prior notice 
purposes, the system will transmit a message back through the OASIS to 
ABI/ACS interface for CBP that the article of food ``may be 
conditionally released under section 801(b) of the act.'' However, if 
additional evaluation of the prior notice information is necessary, FDA 
headquarters staff, operating 24 hours a day, 7 days a week, will 
review and assess the information and may initiate an examination or 
other action by FDA or CBP of the article of food at the port of 
arrival or elsewhere, or in the case of rail shipments, within the 
confines of the closest appropriate examination site.
    In addition, the OASIS system review will determine if further 
staff evaluation of the article of food is necessary for admissibility 
determinations under section 801(a) of the FD&C Act (e.g., subject to 
the guidance in an import alert). If so, FDA staff in the appropriate 
district office will take action, which, in addition to the review and 
evaluation of the submitted information or other documentation, could 
include an examination of the article of food for admissibility 
purposes. This admissibility examination may take place at the border 
but may also take place at an examination site, a public warehouse, or 
other appropriate locations. If FDA determines that refusal under 
section 801(a) of the FD&C Act is appropriate, it will follow 
appropriate procedures.

II. Overview of the Interim Final Rule and Significant Changes Made to 
the Proposed Rule

    The highlights of this interim final rule are described briefly in 
the following paragraphs and are discussed in more detail later in the 
preamble.

A. ``What Definitions Apply to This Subpart?'' (Section 1.276 Proposed 
as Sec.  1.277)

    [sbull] The term ``the act'' was not changed.
    [sbull] The term ``calendar day'' was not changed.

[[Page 58977]]

    [sbull] The term ``country from which the article originates'' was 
added and defined as ``FDA Country of Production.''
    [sbull] The term ``country from which the article of food was 
shipped'' was revised to ``country from which the article is shipped.''
    [sbull] The term ``FDA Country of Production'' replaces the term 
``originating country.'' For an article of food that is in its natural 
state, the FDA Country of Production is the country where the article 
of food was grown, including harvested or collected and readied for 
shipment to the United States. If an article of food is wild fish that 
was caught or harvested outside the waters of the United States by a 
vessel that is not registered in the United States, the FDA Country of 
Production is the country in which the vessel is registered. If an 
article of food that is in its natural state was grown, including 
harvested or collected and readied for shipment, in a Territory, the 
FDA Country of Production is the United States. For an article of food 
that is no longer in its natural state, the FDA Country of Production 
is the country where the article was made; except that, if an article 
of food is made from wild fish aboard a vessel, the FDA Country of 
Production is the country in which the vessel is registered. If an 
article of food that is no longer in its natural state was made in a 
Territory, the FDA Country of Production is the United States.
    [sbull] The term ``food'' has been redefined. The new definition 
excludes ``food contact substances'' as defined in section 409(h)(6) of 
the FD&C Act (21 U.S.C. 348(h)(6)) and ``pesticides'' as defined in 7 
U.S.C. 136(u).
    [sbull] The term ``grower'' has been added to the interim final 
rule. It means a person who engages in growing and harvesting or 
collecting crops (including botanicals), raising animals (including 
fish, which includes seafood), or both.
    [sbull] The term ``international mail'' has been added to the 
interim final rule. The term ``international mail'' means foreign 
national mail services, but not express carriers, express consignment 
operators, or other private delivery services.
    [sbull] The term ``no longer in its natural state'' has been added 
to the interim final rule. The term means that an article of food has 
been made from one or more ingredients or synthesized, prepared, 
treated, modified, or manipulated. Examples of activities that render 
food no longer in its natural state are cutting, peeling, trimming, 
washing, waxing, eviscerating, rendering, cooking, baking, freezing, 
cooling, pasteurizing, homogenizing, mixing, formulating, bottling, 
milling, grinding, extracting juice, distilling, labeling, or 
packaging. However, crops that have been cleaned (e.g., dusted, 
washed), trimmed, or cooled attendant to harvest or collection or 
treated against pests, waxed, or polished are still in their natural 
state for purposes of the prior notice interim final rule. Likewise, 
whole fish headed, eviscerated, or frozen attendant to harvest are 
still in their natural state for purposes of the prior notice interim 
final rule.
    [sbull] The term ``port of entry'' has been defined, as having the 
meaning given in 19 CFR 101.1.
    [sbull] The term ``port of arrival'' has been added to the interim 
final rule. The interim final rule defines ``port of arrival'' to mean 
``the water, air, or land port at which the article of food is imported 
or offered for import into the United States, i.e., the port where the 
article of food first arrives in the United States.''
    [sbull] The term ``registration number'' has been added to the 
interim final rule. Registration number refers to the registration 
number assigned by FDA under section 415 of the FD&C Act, 21 U.S.C. 
350d, and 21 CFR part 1, subpart H.
    [sbull] The term ``shipper'' has been added to the interim final 
rule. The interim final rule defines ``shipper'' as ``the owner or 
exporter of the article of food who consigns and ships the article from 
a foreign country or the person who sends an article of food by 
international mail to the United States.''
    [sbull] The term ``United States'' has been added to the interim 
final rule. It defines ``United States'' as the Customs territory of 
the United States, i.e., ``the 50 States, the District of Columbia, and 
the Commonwealth of Puerto Rico.''
    [sbull] The term ``you'' has been revised to reflect the removal of 
limitations on who is authorized to submit prior notice.

B. ``What is the Scope of This Subpart?'' (Section 1.277 Proposed as 
Sec.  1.276)

    This provision has been revised. Section 1.277(a) clarifies that 
the interim final rule applies to all food for humans and other animals 
that is imported or offered for import into the United States. This 
covers food for use, storage, or distribution in the United States, and 
includes food for gifts, trade and quality assurance/quality control 
samples, food for transshipment through the United States to another 
country, food for future export, and food for use in a U.S. FTZ. 
Section 1.277(b) sets out the exclusions from prior notice. It excludes 
food for an individual's personal use when it is carried by or 
otherwise accompanies the individual when arriving in the United States 
(i.e., for consumption by themselves, family and friends, not for sale 
or other distribution); food that was made by an individual in his/her 
personal residence and sent by that individual as a personal gift 
(i.e., for nonbusiness reasons) to an individual in the United States; 
food that is imported then exported without leaving the port of arrival 
until export; and meat food products, poultry products, and egg 
products that, at the time of importation, are subject to the exclusive 
jurisdiction of the U.S. Department of Agriculture (USDA) under the 
Federal Meat Inspection Act (21 U.S.C. 601 et seq.), the Poultry 
Products Inspection Act (21 U.S.C. 451 et seq.), or the Egg Products 
Inspection Act (21 U.S.C. 1031 et seq.).

C. ``Who Is Authorized to Submit Prior Notice?'' (Section 1.278 
Proposed as Sec.  1.285)

    This provision has been revised. The interim final rule has been 
revised to remove the restriction that the submitter be the U.S. 
importer or purchaser. The interim final rule provides that any person 
with knowledge of the required information may submit prior notice or 
have it transmitted on their behalf.

D. ``When Must Prior Notice Be Submitted to FDA?'' (Section 1.279 
Proposed as Sec.  1.286)

    This provision has been revised. FDA had proposed that all 
information required in the prior notice be submitted to FDA no later 
than 12 noon of the calendar day before the day the article of food 
arrived at the border crossing in the port of entry. Under the interim 
final rule, prior notice must be submitted to FDA and confirmed for FDA 
review no less than 2 hours before arrival by land via road, no less 
than 4 hours before arrival by air and land via rail, and no less than 
8 hours before arrival by water. If the article of food is arriving by 
international mail, the prior notice must be submitted before the food 
has been sent to the United States and the parcel must be accompanied 
by confirmation of FDA receipt of prior notice. With the exception of 
prior notice for international mail, prior notice may not be submitted 
more than 5 calendar days before the anticipated date of arrival at the 
anticipated port of entry. When an article of food that is carried by 
or otherwise accompanies an individual is subject to prior notice, the 
prior notice must be submitted within the timeframe established for the 
mode of transportation, and the food must be accompanied by a copy of 
the FDA confirmation including the PN Confirmation Number. Because we

[[Page 58978]]

reduced the timeframes for submitting prior notice in the interim final 
rule to the minimum amount of time that we need to meet our statutory 
responsibility to receive, review, and respond to prior notice 
submissions, the interim final rule does not provide for amendments or 
updates to the prior notice. However, as discussed in more detail in 
section D, FDA and CBP will be actively exploring ways to reduce prior 
notice timeframes, while fulfilling the Bioterrorism Act mandates.

E. How Must You Submit Prior Notice? (Section 1.280 Proposed as Sec.  
1.287)

    FDA proposed that prior notice, amendments, and updates be 
submitted electronically to FDA through the FDA PN System. The interim 
final rule provides that prior notice must be submitted electronically, 
in English (except an individual's name, the name of a company, or the 
name of a street), through either CBP's ABI/ACS or the FDA PN System 
Interface. All information must be submitted using the Latin (Roman) 
alphabet. The interim final rule eliminates submission of duplicative 
information to FDA by those who can file import entry information 
through ABI/ACS. FDA and CBP are upgrading and interfacing their 
respective electronic systems so that information required for prior 
notice can be submitted through ABI/ACS. Information required by the 
interim final rule also can be submitted through the FDA PN System 
Interface. The interim final rule also provides that if a customs 
broker's of self-filer's system is not working or if ABI/ACS is not 
working, prior notice must be submitted through the FDA PN System 
Interface. If the FDA PN System Interface or OASIS is not operating, 
prior notice information must be submitted by e-mail, or by fax to the 
FDA, but not in person.

F. What Information Must Be in a Prior Notice? (Section 1.281 Proposed 
as Sec.  1.288)

    The interim final rule requires the following information to be 
submitted in the prior notice:
    [sbull] Submitter (name of individual, individual's telephone, fax, 
e-mail, name/address of submitting firm);
    [sbull] Transmitter, if different than submitter (name of 
individual, individual's telephone, fax, e-mail, name/address of 
transmitting firm);
    [sbull] Entry type;
    [sbull] CBP entry identifier, such as the CBP entry number or in-
bond number;
    [sbull] The identity of the article of food as follows: The 
complete FDA product code; the common or usual name or market name; the 
estimated quantity described from largest container to the smallest 
package size; and the lot or code numbers or other identifier of the 
food if required by the FD&C Act or FDA regulations;
    [sbull] Manufacturer, for food no longer in its natural state 
(name, address, registration number, except that the requirement to 
provide registration number does not apply to an article of food that 
is imported for transshipment or other export;
    [sbull] Grower, if known, for an article of food that is in its 
natural state (name and growing location);
    [sbull] Consolidator may voluntarily be provided by the submitter, 
at the submitter's option, if the grower is not known (name and 
address);
    [sbull] FDA Country of Production;
    [sbull] Shipper (name, address, registration number; except that 
the requirement to provide registration number does not apply to an 
article of food that is imported for transshipment or other export;
    [sbull] The country from which the article is shipped;
    [sbull] Anticipated arrival information (port of arrival and 
crossing location within that port, date, and time) or, if the food is 
imported by international mail, the anticipated date of mailing;
    [sbull] The name and address of the importer, owner, and ultimate 
consignee, unless the shipment is imported or offered for import for 
transshipment through the United States under a T&E entry, or, if the 
food is imported by international mail, the U.S. recipient (name and 
address);
    [sbull] Mode of transportation;
    [sbull] Carrier (SCAC/Standard Carrier Abbreviated Code or IATA/
International Air Transportation Association code or, if codes are not 
applicable, the name and country of the carrier) (except for food 
imported by international mail);
    [sbull] Planned shipment information as applicable (except for food 
imported by international mail), including 6-digit HTS code; and
    [sbull] If the article of food is under hold for failure to submit 
prior notice or submit an adequate prior notice, the location where it 
is being held, the date the article has arrived or will arrive at the 
location, and the name of a contact individual at the location.
    FDA eliminated from the interim final rule telephone and fax 
numbers and e-mail addresses for most firms, entry line numbers, trade 
or brand name, and consumption entry information (port of entry/
anticipated date of entry for Customs purposes). FDA revised 
information requirements regarding the quantity, lot/code identifier, 
manufacturer, grower, and carrier in the interim final rule. FDA added 
mode of transportation and planned shipment information to the interim 
final rule. In the interim final rule, registration numbers are 
required only for manufacturer and shipper, if the shipper is a 
facility that is required to be registered under section 415 of the 
FD&C Act (21 U.S.C. 350d) and 21 CFR part 1, subpart H, for that 
article of food. For clarity, the interim final rule segregates the 
information required for food arriving by international mail (Sec.  
1.281(b)) and also segregates the information required for food refused 
under section 801(m) of the FD&C Act (Sec.  1.281(c)).
    Table 1A, which appears later in this preamble, describes the 
information required in prior notice.

G. ``What Must You Do If Information Changes After You Have Received 
Confirmation of a Prior Notice From FDA?'' (Section 1.282 Proposed as 
Sec. Sec.  1.289 to 1.294)

    This provision has been revised in the interim final rule. The 
proposed rule allowed one product identity amendment for certain 
product identity information that was not known at the time of 
submission and for arrival updates. Product identity amendments could 
be submitted up to 2 hours before arrival at the border. Arrival 
updates were required if the port of entry changed or if the time of 
arrival was expected to be more than 3 hours later or 1 hour earlier 
than the anticipated time of arrival.
    The interim final rule does not provide for product identity 
amendments or arrival updates. Because we reduced the timeframes for 
submitting prior notice in the interim final rule to the least amount 
of time that we need to meet our statutory responsibility to receive, 
review, and respond to prior notice submissions, the interim final rule 
does not provide for amendments or updates. The interim final rule 
requires that if required information (except estimated quantity, 
anticipated arrival information including the anticipated date of 
mailing, and planned shipment information) changes after FDA has 
confirmed prior notice for review, the prior notice should be cancelled 
and a prior notice with the correct information must be submitted.

H. ``What Happens to Food That Is Imported or Offered for Import 
Without Adequate Prior Notice?'' (Section 1.283 Proposed as Sec.  
1.278)

    FDA revised the proposed rule to provide for more specificity, to 
clarify

[[Page 58979]]

the status of refused food, and to provide a mechanism for FDA review 
after refusal. In the interim final rule, FDA identifies the 
consequences and procedures for the following situations:
1. Inadequate Prior Notice (No, Inaccurate, or Untimely Prior Notice)
    Unless immediately exported with CBP concurrence, an article of 
food that is refused for inadequate prior notice shall be held in 
accordance with Sec.  1.283.
2. Status and Movement of Refused Food
    [sbull] A refused food is considered general order merchandise 
under section 490(a) of the Tariff Act of 1930, as amended (19 U.S.C. 
1490(a)).
    [sbull] The refused food must be moved under an appropriate 
custodial bond. FDA must be notified of the location where the food has 
been or will be moved within 24 hours of refusal. If the food is held, 
it must be taken directly to the designated location within 48 hours, 
shall not be entered, and shall not be delivered to any importer, 
owner, or ultimate consignee.
3. Segregation of Refused Foods
    If a refused food is part of a shipment that contains other 
articles, the refused food may be segregated from the rest of the 
shipment within the port of arrival or at the hold location if 
different.
4. Costs
    Neither FDA nor CBP are liable for transportation, storage, or 
other expenses resulting from refusal.
5. Export After Refusal
    A refused food may be exported with CBP concurrence and supervision 
(unless CBP or FDA has administratively detained or seized the article 
under other authority).
6. No Post-Refusal Submission or Request for Review
    If no prior notice submission or request for FDA review is 
submitted in a timely fashion after a food is refused, the food will be 
dealt with as set forth in CBP regulations relating to general order 
merchandise. It may only be sold for export or destroyed as agreed to 
by CBP and FDA.
7. Food Carried by or Otherwise Accompanying an Individual
    For food that is not for personal use, if the article of food is 
refused because prior notice is inadequate or the individual cannot 
provide FDA or CBP with a copy of the PN confirmation, the article may 
be held at the port or exported. If the individual cannot make 
arrangements for holding or export, the food may be destroyed.
8. Post-Refusal Prior Notice Submissions
    If an article of food is refused for no or inaccurate prior notice, 
the prior notice must be submitted or corrected and resubmitted to FDA 
and confirmed by FDA for review.
9. FDA Review After Refusal
    After refusal, only the submitter, importer, owner, or ultimate 
consignee may submit a written request asking FDA to review whether the 
article is subject to the requirements of this subpart under Sec.  
1.276(b)(5) and Sec.  1.277, or whether the prior notice submission is 
accurate. The interim final rule also sets out procedures and 
timeframes for the review process.
10. International Mail
    In the case of food arriving by international mail, if prior notice 
is inadequate or if the PN Confirmation Number is not affixed, the 
article will be held by CBP for 72 hours for FDA inspection and 
disposition. If refused and there is a return address, the parcel may 
be returned to sender. If there is no return address or the food in the 
shipment appears to present a hazard, FDA may dispose of or destroy the 
parcel at its expense. If FDA does not respond within 72 hours of the 
CBP hold, CBP may return the parcel back to the sender or, if there is 
no return address, destroy the parcel, at FDA expense.
11. Prohibitions on Delivery and Transfer
    A refused article of food may not be delivered outside of the port 
where the article is held and may not be delivered to the importer, 
owner, or ultimate consignee or transferred by any person from the port 
or secure facility until FDA has examined the prior notice, determined 
the adequacy of the prior notice, and notified CBP and the transmitter 
that the article is no longer refused. After this notification by FDA 
to CBP and transmitter, entry may be made in accordance with law and 
regulation.
12. Relationship to Other Admissibility Provisions
    A determination that an article of food is no longer subject to 
refusal under section 801(m)(1) of the FD&C Act is different than, and 
may come before, determinations of admissibility under other provisions 
of the FD&C Act or other U.S. laws. A determination that an article of 
food is no longer subject to refusal under section 801(m)(1) of the 
FD&C Act does not mean that it will be granted admission under other 
provisions of the FD&C Act or other U.S. laws.

I. What Are the Other Consequences of Failing to Submit Adequate Prior 
Notice or Otherwise Failing to Comply With This Subpart? (Section 1.284 
Proposed as Sec.  1.278)

    The interim final rule provides that failure of a person who 
imports or offers to import an article of food to submit prior notice 
is a prohibited act under section 301(ee) of the FD&C Act (21 U.S.C. 
331(ee)) and sets out the civil, criminal, and debarment actions that 
the United States may bring against persons who are responsible for the 
commission of a prohibited act.

J. What Happens to Food That Is Imported or Offered for Import From 
Unregistered Facilities That Are Required to Register Under 21 CFR Part 
1, Subpart H? (Section 1.285)

    The interim final rule also sets out the consequences concerning 
what happens at the border to food from facilities that are not 
registered as required under section 415 of the FD&C Act and 21 CFR 
part 1, subpart H. These are similar to provisions in the interim final 
rule for dealing with food that is refused for inadequate prior notice.
    Table 1A of this document shows the information required by 
sections 1.281(a), (b), and (c). For clarity, the table also identifies 
under what circumstances certain information is not required, e.g., 
registration numbers when the article of food is imported or offered 
for import for transshipment, storage and export, or further 
manipulation and export.

BILLING CODE 4160-01-P

[[Page 58980]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.074

BILLING CODE 4160-01-C

III. Comments on the Proposed Rule

    FDA received approximately 470 timely responses containing one or 
more comments in response to the proposed rule. To make it easier to 
identify comments and responses to the comments, the word ``Comments'' 
will appear before the description of the comment, and the word 
``Response'' will appear before our response. A summary follows which 
includes a description of the appropriate section in the interim final 
rule.

A. General Comments and Outreach

    (Comments) Some comments suggest revision of section 307 of the 
Bioterrorism Act. Other comments recommend that FDA repropose the rule 
or not implement the rule.
    (Response) Changes to the statute are beyond the scope of this 
rulemaking. Postponing implementation of or not implementing the rule 
is not viable under section 307(c) of the Bioterrorism Act, which not 
only directs the FDA to ``promulgate proposed and final regulations for 
the requirement of

[[Page 58981]]

providing notice in accordance with section 801(m)'' by December 12, 
2003, but also provides that an 8 hour prior notice requirement takes 
effect on this date even if FDA has not promulgated regulations that 
are in effect by this deadline. However, we are publishing this rule as 
an interim final rule and are, accordingly, soliciting comment on its 
provisions.
    (Comments) Most comments generally support the protections of the 
food supply provided under the Bioterrorism Act. Although comments 
recommend that the final rule be amended to reflect more accurately 
industry practices, other comments suggest the regulation should be 
strengthened to ensure that FDA has all of the information required to 
identify foods that may pose a health or security threat. Some comments 
argue that FDA already has access to information currently submitted to 
CBP to allow for identification and quick interdiction of foods that 
may pose a health or security threat. Other comments question how the 
final rule would enhance FDA's ability to improve food safety and 
whether the benefits outweigh the costs.
    (Response) Through section 307 of the Bioterrorism Act, Congress 
amended the FD&C Act to require the submission to FDA of a notice 
providing information regarding food before its importation into the 
United States. Congress also required FDA to issue implementing 
regulations to be effective not later than December 12, 2003. Thus, a 
postponement of the rule is not an option. Although FDA is aware that 
the prior notice regulation will affect industry, Congress determined 
the need for prior notice by passing the Bioterrorism Act. Prior notice 
of imported food will give FDA better information about the food 
earlier, enabling FDA to review and respond to the information before 
the arrival of the food at the border. Prior notice also will give FDA 
information with which it will be able to better focus its inspection 
resources. Section V of this preamble, Analysis of Economic Impacts, 
discusses the benefits of this interim final rule in detail. To address 
many of the concerns raised by the comments, FDA has made significant 
modifications in the interim final rule. However, we are publishing 
this rule as an interim final rule and are, accordingly, soliciting 
comment on its provisions.
    (Comments) Some comments ask that FDA provide clear guidance and 
training to industry and agency field personnel about the procedures 
for implementing the regulation.
    (Response) FDA conducted extensive outreach on the proposed prior 
notice rule, including having relevant FDA staff attend 6 international 
meetings and over 100 domestic meetings to ensure that affected parties 
were aware of the Bioterrorism Act prior notice requirements. On 
January 29, 2003, FDA held a public meeting (via satellite downlink) to 
discuss both the registration and prior notice proposed rules (see 68 
FR 1568, January 13, 2003) or http://www.accessdata.fda.gov/scripts/oc/ohrms/advdisplay.cfm. Nearly 1,000 participants in North and South 
America and the Caribbean viewed that live broadcast. The meeting was 
later re-broadcast to Europe, Asia, Africa, and the Pacific. FDA has 
also posted transcripts of the broadcast in English, French, and 
Spanish on the agency's Web site.
    FDA plans similar outreach efforts directed to both domestic and 
international stakeholders after publication of the interim final rule 
implementing the registration and prior notice provisions of the 
Bioterrorism Act. Outreach will include many methods of communication:
    [sbull] Dissemination of materials to guide affected domestic and 
international food facilities through the new processes established to 
implement the registration and prior notice requirements;
    [sbull] Domestic outreach meetings to State regulators and 
industry;
    [sbull] A satellite downlink video broadcast and a series of 
videoconferences to various regions of the world;
    [sbull] Materials and events for the media;
    [sbull] International outreach to food trading partners;
    [sbull] Presentations by FDA officials and exhibits at professional 
and trade conferences and meetings to inform industry and state and 
local government representatives of the new requirements; and
    [sbull] Cooperative arrangements with CBP and other Federal 
agencies to ensure that information on the interim final regulations 
and their requirements is disseminated to affected companies and 
individuals.
    More specifics regarding each of these will be included in FDA's 
Web site at http://www.fda.gov. In addition, FDA also plans training in 
new or revised procedures for its field personnel, as well as CBP field 
personnel. FDA will also provide guidance on enforcement to its staff 
containing the agency's policies on injunctions, prosecution, and 
debarment related to failure to provide timely and accurate prior 
notice, as well as the agency's policies regarding refusals under 
section 801(m)(1) of the FD&C Act and holds under section 801(l). As 
described in greater detail later, FDA intends to include a transition 
period in this guidance, during which it will emphasize education to 
achieve compliance. Guidance documents are available to the public, and 
FDA will shortly publish a notice of availability in the Federal 
Register.
    FDA will notify the World Trade Organization (WTO) of this interim 
final rule. Shortly after publication of this interim final rule, FDA 
will begin disseminating at U.S. ports flyers and posters summarizing 
the new requirements and informing representatives of affected entities 
how to provide prior notice to FDA. Online assistance and a help desk 
will be available when the interim final rule becomes effective.

B. Foreign Trade Issues

    (Comments) Some comments questioned the consistency of the proposed 
regulation with U.S. obligations under various WTO agreements, NAFTA, 
and other international agreements.
    (Response) FDA is aware of the international trade obligations of 
the United States and has considered these obligations throughout the 
rulemaking process for this regulation and the interim final regulation 
is consistent with these international obligations.
    (Comments) Some comments asserted that the proposed regulation is 
burdensome, confusing, costly, disproportionate, discriminatory, and 
will have a negative impact on foreign trade.
    (Response) In drafting the proposed rule, FDA considered how best 
to structure the proposed rule consistent with the statutory mandates 
of the Bioterrorism Act and, at the same time, to reduce the costs 
associated with compliance. As discussed in more detail in the 
following paragraphs, FDA has carefully considered comments received 
regarding the burden imposed by the proposed rule, including its 
effects on international trade. Furthermore, based on the comments 
received on the proposed requirements, FDA has made a number of 
significant changes that minimize the impact of prior notice 
requirements on the food industry. These changes include removing 
restrictions on who can submit prior notice; allowing submission to be 
made either through ABI/ACS (the existing mechanism for filing entry 
information with CBP) or the FDA PN System Interface (the FDA PN Web 
system described in the proposed rule); reducing the timeframes for 
submission of prior notice and tying them to mode

[[Page 58982]]

of transport; and streamlining the information requirements.

C. ``What Definitions Apply to This Subpart?'' (Section 1.276 Proposed 
as Sec.  1.277)

1. The Act (Sec.  1.276(a))
    The proposed rule defined ``the act'' as the Federal Food, Drug, 
and Cosmetic Act. The proposed rule also applies the definitions of 
terms in section 201 of the act (21 U.S.C. 321) to such terms as used 
in the proposed rule.
    (Comments) FDA did not receive comments on the definition of ``the 
act.''
    (Response) We did not change the definition in the interim final 
rule. We have clarified that the definitions in the FD&C Act do not 
apply if a term is defined differently in the interim final rule.
    (Interim final rule) Section 1.276(a) of the interim final rule 
defines ``the act'' as the Federal Food, Drug, and Cosmetic Act. 
Section 1.276(b) provides the definitions in the FD&C Act apply unless 
a term is defined differently in the interim final rule.
2. Calendar Day (Sec.  1.276(b)(1))
    The proposed rule defined ``calendar day'' as ``every day shown on 
the calendar.''
    (Comments) FDA did not receive comments on the definition of 
``calendar day.''
    (Response) We did not change the definition in the interim final 
rule.
    (Interim final rule) ``Calendar day'' is defined in Sec.  
1.276(b)(1) of the interim final rule as ``every day shown on the 
calendar.''
3. Country From Which the Article Originates (Sec.  1.276(b)(2))
    Section 801(m)(1) of the FD&C Act requires that ``the country from 
which the article originates'' be identified in a prior notice. The 
proposed rule used the term ``originating country'' and defined it as 
``the country from which the article of food originates.''
    (Comments) Comments were received on the proposed definition of 
``originating country.'' These comments are addressed under ``FDA 
Country of Production,'' which is the term that FDA has chosen in the 
interim final rule to replace ``originating country.''
    (Response) The term ``the country from which the article 
originates'' has been added to the interim final rule to refer back to 
the statutory language.
    (Interim final rule) ``Country from which the article originates'' 
is defined as ``FDA Country of Production.''
4. Country From Which the Article Is Shipped (Sec.  1.276(b)(3))
    The proposed rule defined ``country from which the article of food 
was shipped'' as ``the country in which the article of food was loaded 
onto the conveyance that brings it to the United States.'' A conveyance 
is the means of transportation, e.g., ship, truck, car, van, plane, 
railcar, etc., not the shipping container that can be moved from a ship 
to a truck to a train. FDA requested comment on whether the phrase 
``country from which the article of food was shipped'' should include 
the countries of intermediate destination.
    (Comments) Several comments support identifying countries of 
intermediate destination, noting that it would be desirable to have 
this information to support product tracing. One states that even if a 
food product were merely shipped through another country without 
further manufacturing/processing, the potential for tampering would 
still exist. This comment is concerned that, without information on 
every intermediate country, FDA would lack the ability to trace food 
for potential contamination back through the distribution chain. 
Another comment supports providing the countries of intermediate 
destination. It states that, except in the case of sealed containers, 
the manufacturer cannot control manipulation that occurs in countries 
of intermediate destination.
    Several comments state that the information required in a prior 
notice should not include countries of intermediate destination. Other 
comments note that: An imported article may pass through a number of 
ports or stops in a variety of countries and never be unloaded; a U.S. 
importer in most cases has no control of which ports or stops a carrier 
may make; and exporters cannot guarantee which ports the ship will 
enter or pass through on its way to a U.S. port. Another comment states 
the information would not be necessary for sealed containers because 
alteration or absence of a seal alerts the owner to tampering, but it 
may be necessary for bulk or unpackaged products. Most of the comments 
that object conclude that submission of additional countries of 
intermediate destination would be unreasonable and burdensome and would 
not improve the safety and security of the food supply.
    (Response) Section 801(m)(l) of the FD&C Act uses the singular 
``country'' when it directs submission of the identity of the country 
from which the article is shipped, not the plural ``countries.'' Thus, 
FDA has concluded that the text of the statute dictates that the 
definition be singular. The interim final rule thus retains the 
proposed definition of the term ``country from which the article was 
shipped.''
    (Comments) One comment states that the proposed definition of 
``country from which the article of food was shipped'' is clear and 
suggests that it be maintained. Several commenters suggest that 
``country from which the article of food was shipped'' should be 
defined as the country from which the goods were ``exported'' to the 
United States as that phrase is used in the CBP regulations defining 
``country of export.''
    Other comments suggest that FDA's definition failed to take into 
account the following considerations: That ocean and air carriers 
routinely use ``feeder'' vessels/aircraft to move cargo from the 
country of origin to a ``gateway'' for transfer to a larger vessel or 
aircraft that will transport the cargo to its final destination; and 
that ocean vessels frequently discharge containers destined for the 
United States in Canada where they are transferred to a motor carrier 
for transport to the United States. The comments conclude that the 
proposal, if implemented, would confuse importers and require them to 
attempt to obtain the cargo routing from master carriers. They suggest 
that FDA require instead the reporting of the last country in which a 
product was stored if that is different from the country in which it 
was produced (the country of production).
    (Response) Section 801(m)(1) of the FD&C Act requires that prior 
notice submissions identify ``the country from which the article is 
shipped.'' ``Country of export'' is not a term formally defined in 
CBP's regulations.
    We acknowledge that food may pass through more than one country 
before it reaches the United States. However, we do not believe that 
this practice changes the definition dictated by the statutory 
language. Several examples may be helpful. In one scenario, a shipper 
in country A arranges for a food manufactured in country B to be 
transported to the United States via country C. The food arrives in 
country C on an ocean vessel and is transferred to a truck that brings 
it to the U.S. port of arrival. In this first scenario, the country 
from which the article is shipped is country C.
    In a second scenario, a shipper in country A arranges for a food 
manufactured in country B to be transported to the United States by a 
ship that is loaded in country B but stops in country C and then 
continues to the United States where the food is discharged. In this 
second scenario, the country from which the article is

[[Page 58983]]

shipped is country B. In a third scenario, if the food was transferred 
to a different vessel in country C, the country from which the article 
is shipped is country C.
    (Interim final rule) Section 1.276(b)(3) of the interim final rule 
defines ``country from which the article is shipped'' as ``the country 
in which the article of food is loaded onto the conveyance that brings 
it to the United States.'' We changed the term from ``country from 
which the article was shipped'' to ``country from which the article is 
shipped'' to accurately reflect the language of the statute.
5. FDA Country of Production and Originating Country (Sec.  
1.276(b)(4))
    The proposed rule defined ``originating country'' as ``the country 
from which the article of food originates,'' which means the country 
where the article of food was grown and harvested, or if processed, 
where the article of food was produced.
    (Comments) Many comments regarding the definition of ``originating 
country'' suggest that FDA use the ``country of origin'' definition 
used by CBP, or the standard rules of origin used by CBP, USDA, and 
associations such as the WTO.
    (Response) Section 801(m)(1) of the FD&C Act requires prior notice 
submissions to FDA identify ``the country from which the article 
originates.''
    We have not changed the definition of ``originating country'' to 
align it with ``country of origin'' as that term is defined by CBP. CBP 
defines ``country of origin'' at 19 CFR 134.1(b) as follows:

the country of manufacture, production, or growth of any article of 
foreign origin entering the United States. Further work or material 
added to an article in another country must effect a substantial 
transformation in order to render such other country the ``country 
of origin'' within the meaning of this part; however, for a good of 
a NAFTA country, the NAFTA Marking Rules will determine country of 
origin.

    In rulings, CBP has further defined ``country of origin'' and 
substantial transformation to identify the country of growth of the 
main ingredient in a processed food rather than the country of 
production of ``the article [of food]'' (emphasis added) in the form it 
is being imported into the United States. For example, a CBP ruling 
identified the country of origin as the United States where beans were 
rehydrated and canned in the Dominican Republic, but grown and dried in 
the United States (Ref. 1). For purposes of the prior notice provisions 
of the FD&C Act, the ``article of food'' is canned beans, not dried 
beans. From a food safety standpoint, FDA is most interested in knowing 
where the article of food was processed and canned. We believe that it 
best serves the language and the purposes of section 801(m)(l) of the 
FD&C Act to define the term to focus on the country of production of 
the specific article of food that is being shipped to the United 
States. To avoid confusion between FDA's prior notice requirements and 
CBP requirements, the interim final rule uses the term ``FDA Country of 
Production'' instead of the term ``originating country'' or ``country 
from which the article originates.'' ``FDA Country of Production'' is 
already familiar to customs brokers and self-filers using ABI/ACS 
interface with OASIS.
    (Comments) One comment suggests that ``EU'' (European Union) be 
acceptable for use as an originating country.
    (Response) FDA disagrees. Section 801(m) of the FD&C Act requires 
identification of ``the country from which the article originates'' 
(emphasis added). Accordingly, for purposes of this provision, each 
sovereign country must be identified when declared as part of the prior 
notice submission.
    (Comments) Several comments suggest that the definition of 
``country of origin'' for fish be the country in which the vessel is 
flagged or in which the fish was last processed. Another comment asks 
FDA to use the definition of ``country of origin'' being used by USDA's 
Agricultural Marketing Service for fish and seafood.
    (Response) We generally agree. The proposed rule relied in part on 
USDA's proposed definition as set out in USDA guidance published in the 
Federal Register on October 11, 2002, and is based on the Farm Security 
and Rural Investment Act of 2002 (commonly known as the 2002 Farm 
Bill), as amended. As set out in Sec.  1.276(b)(4) of the interim final 
rule, if an article of food is wild fish that is still in its natural 
state and was caught or harvested outside the waters of the United 
States by a vessel that is not registered in the United States, the FDA 
Country of Production is the country in which the vessel is registered. 
If the article of food is made from wild fish aboard a vessel, the FDA 
Country of Production is the country in which the vessel is registered.
    (Comments) Several comments express concern that the proposed 
definition, ``[o]riginating country means the country from which the 
article of food originates,'' does not take into consideration the 
producer, processor, vessel or common carrier feeder and consolidation 
practices in which components of the shipment may be composites or 
commingled from more than one country. One comment asks that FDA 
describe when the country of canning would be the originating country, 
and when it would not. One comment suggests that decaffeinating or 
blending coffee be considered processing and that decaffeinated or 
blended coffee be considered as processed food for the purposes of 
prior notice.
    (Response) Some of these comments appeared to confuse the proposed 
definition of ``country from which the article of food was shipped'' 
with the proposed definition of ``originating country,'' another reason 
why we decided to use the term ``FDA Country of Production.'' As 
explained above in the discussion of ``the country from which the 
article is shipped,'' the two countries will sometimes be different. 
When determining which country is the FDA Country of Production, the 
focus should be on the production of the specific article of food. For 
example, if the article of food is raw, whole, unpeeled carrots, the 
FDA Country of Production is the country where the carrots were grown 
and harvested. If the article of food is raw peeled and chopped carrots 
or canned carrots, the FDA Country of Production is the country where 
the carrots were peeled and chopped or canned. As a general matter, for 
canned foods, the FDA Country of Production should be the country where 
food was canned. Similarly, we consider decaffeinated coffee to be no 
longer in its natural state and the FDA Country of Production would be 
the country in which the coffee was decaffeinated.
    (Interim final rule) Section 1.276(b)(4) of the interim final rule 
defines the ``FDA Country of Production'' for an article of food that 
is in its natural state, as country where the article of food was 
grown, including harvested or collected and readied for shipment to the 
United States. If an article of food is wild fish, including seafood, 
that was caught or harvested outside the waters of the United States by 
a vessel that is not registered in the United States, the FDA Country 
of Production is the country in which the vessel is registered. For an 
article of food that is no longer in its natural state, the FDA country 
of production is defined as the country where the article was made; 
except that, if an article of food is made from wild fish, including 
seafood, aboard a vessel, the FDA Country of Production is the country 
in which the vessel is registered. If an article of food that is no 
longer in its natural state was made in

[[Page 58984]]

a Territory, the FDA Country of Production is the United States.
6. Food (Sec.  1.276(b)(5))
    The proposed rule defined ``food'' as having the meaning given in 
section 201(f) of the FD&C Act. The proposed rule provided examples of 
food including:

fruits, vegetables, fish, dairy products, eggs, raw agricultural 
commodities for use as food or components of food, animal feed, 
including pet food, food and feed ingredients and additives, 
including substances that migrate into food from food packaging and 
other articles that contact food, dietary supplements and dietary 
ingredients; infant formula, beverages, including alcoholic 
beverages and bottled water, live food animals (such as hogs and 
elk), bakery goods, snack foods, candy, and canned foods.

    a. Food packaging and other food contact substances.
    (Comments) We received several comments on the subject of food 
contact substances, including packaging. The comments ask that FDA 
clarify the definition of ``food'' because the proposed rule included 
as examples of food not only those items traditionally understood as 
food, but also items that come into contact with and may migrate into 
food during processing or packaging. In particular, the comments ask 
that food packaging and components of food packaging, other food 
contact articles (such as food processing equipment and components of 
such equipment, glassware, dishware, cutlery, kitchen appliances), and 
so-called indirect additives (including those applied to food contact 
surfaces) be excluded from the final rule's definition of ``food.''
    In support, the comments contend the legislative history of the 
prior notice provisions establish that Congress did not intend to apply 
prior notice requirements to these substances even though they can be 
food within the meaning of section 201(f) of the FD&C Act. In addition, 
some point to language in section 415 of the FD&C Act (21 U.S.C. 350d) 
relating to registration and language in section 414(b) of the FD&C Act 
relating to recordkeeping (21 U.S.C. 350c). Finally, some comments 
argued that an overly broad definition of ``food'' would dilute the 
government's resources, thereby hampering the government's opportunity 
to achieve the protective goals of the Bioterrorism Act.
    (Response) We expressly included food packaging and other food 
contact materials in the proposed definition, with the result that 
prior notice would have been required for food packaging and other food 
contact materials and their components (see 68 FR 5428 at 5430). The 
breadth of the proposed definition of ``food'' was based on both the 
statutory definition in section 201(f)(3) of the FD&C Act, which 
defines articles used as components of food as ``food,'' as well as the 
case law interpreting the definition, including Natick Paperboard v. 
Weinberger, 525 F.2d 1103 (1st Cir. 1975) (paperboard containing PCBs 
intended for food use is adulterated food; U.S. v. Articles of food * * 
* 688 Cases * * * of Pottery (Cathy Rose), 370 F. Supp. 371 (E.D. Mi. 
1974) (ceramic pottery that leaches lead is adulterated food).
    The comments on food contact substances raise the question of what 
Congress intended ``food'' to mean for purposes of prior notice. In 
construing the prior notice provision of the Bioterrorism Act, FDA is 
confronted with two questions. First, has Congress directly spoken to 
the precise question presented? (``Chevron step one'') Chevron, U.S.A., 
Inc. v. NRDC, Inc., 467 U.S. 837, 842 (1984). To find no ambiguity, 
Congress must have clearly manifested its intention with respect to the 
particular issue (Young v. Community Nutrition Institute, 476 U.S. 974, 
980 (1986)). If Congress has spoken directly and plainly, the agency 
must implement Congress's unambiguously expressed intent (Chevron, 467 
U.S. at 842-843). If, however, the Bioterrorism Act is silent or 
ambiguous as to the meaning of ``food,'' FDA may define ``food'' in a 
reasonable fashion (``Chevron step two''); Chevron, 467 U.S. at 842-
843; FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120, 132 
(2000)).
    The agency has determined that, in enacting section 801(m) of the 
FD&C Act, Congress did not speak directly and precisely to the meaning 
of ``food.'' As noted, the FD&C Act has a definition of ``food'' at 
section 201(f). It may be a reasonable assumption that, when the term 
``food'' is used in the FD&C Act, section 201(f) applies. However, 
although there may be ``a natural presumption that identical words used 
in different parts of the same act are intended to have the same 
meaning [citation omitted], * * * the presumption is not rigid * * *.'' 
(Atlantic Cleaners & Dyers, Inc. v. U.S., 286 U.S. 427, 433 (1932); 
(accord: U.S. v. Cleveland Indians Baseball Co., 532 U.S. 200, 213 
(2000)). Thus, the same word may be given different meanings, even in 
the same statute, if Congress intended different interpretations or if 
such different interpretations are reasonable (at step 2) (Atlantic 
Cleaners & Dryers, Inc., supra).
    Even before the Bioterrorism Act amendments, the term ``food'' was 
not defined identically throughout the FD&C Act. For example, in 
construing the parenthetical ``(other than food)'' in section 
201(g)(1)(C) of the FD&C Act, the Seventh Circuit Court noted that 
Congress meant to exclude only ``articles used by people in the 
ordinary way that most people use food--primarily for taste, aroma, or 
nutritive value'' and not all substances defined as food by section 
201(f) (Nutrilab, Inc. v. Schweiker, 713 F.2d 335, 338 (7th Cir. 
1983)). Similarly, section 409(h)(6) of the FD&C Act defines a ``food 
contact substance'' as ``any substance intended for use as a component 
of materials used in manufacturing, packing, packaging, transporting, 
or holding food if such use is not intended to have any technical 
effect in such food'' (emphasis added). This definition makes sense 
only if ``food'' in this context excludes materials that contact food 
because components of food contact materials are plainly intended to 
have a technical effect in such materials.\2\
---------------------------------------------------------------------------

    \2\ FDA's long-standing interpretation of the FD&C Act's 
definition of color additive, section 201(t), is an additional 
example of where ``food'' is used more narrowly than as defined in 
section 201(f). A color additive is defined in section 201(t) of the 
FD&C Act as a substance that ``when applied to a food * * * is 
capable * * * of imparting color thereto * * *.'' The agency's food 
additive regulations distinguish between color additives and 
``colorants,'' the latter being used to impart color to a food-
contact material (21 CFR 178.3297(a); see also 21 CFR 70.3(f)). 
Thus, ``food'' as it appears in the statutory definition of color 
additive, necessarily excludes food contact materials.
---------------------------------------------------------------------------

    Thus, in this larger statutory context, FDA has evaluated section 
801(m) of the FD&C Act to determine whether the meaning of the word 
``food'' is ambiguous. In conducting this Chevron step one analysis, 
all of the traditional tools of statutory interpretation are available 
to determine whether the language Congress used is ambiguous 
(Pharmaceutical Research & Manufacturers of America v. Thompson, 251 F. 
3d 219, 224 (D.C. Cir. 2001)). Beginning with the language of the 
statute, in section 801(m) of the FD&C Act, ``food'' is used to 
describe which subset of FDA-regulated articles are subject to prior 
notice:

    In the case of an article of food that is being imported or 
offered for import into the United States, the Secretary, after 
consultation with the Secretary of the Treasury, shall by regulation 
require, for the purpose of enabling such article to be inspected at 
ports of entry into the United States, the submission to the 
Secretary of a notice * * * (emphasis added).

The Bioterrorism Act is silent as to the meaning of ``food.'' Congress 
did not specify whether it intended the definition in section 201(f) of 
the FD&C Act to apply, one of the other

[[Page 58985]]

possibilities noted above, or another meaning. Where, as here, the 
statutory language on its face does not clearly establish Congress's 
intent, it is appropriate to consider not only the particular statutory 
language at issue, but also the language and design of the statute as a 
whole (Martini v. Federal Nat'l Mortgage Association, 178 F. 3d 1336, 
1345 (D.C. Cir. 1999), citing K Mart Corp. v. Cartier, Inc., 486 U.S. 
281 (1988)). Indeed, the analysis should not be confined to the 
specific provision in isolation, because the meaning or ambiguity of a 
term may be evident only when considered in a larger context (FDA v. 
Brown & Williamson Tobacco Corp., supra at 132 (2000)).
    Consistent with this instruction, FDA has considered other parts of 
the Bioterrorism Act in assessing whether the meaning of ``food'' in 
section 801(m) of the FD&C Act ambiguous. In particular, FDA has 
considered the language of section 415 of the FD&C Act. The 
Bioterrorism Act's registration provision is one piece of several 
enacted by Congress to enhance the safety of the U.S. food supply. 
Registration is designed to work in concert with prior notice. This is 
reflected in the Bioterrorism Act's amendment of section 801 of the 
FD&C Act to provide that food from an unregistered foreign facility be 
held at the port when imported or offered for import (section 801(l) of 
the FD&C Act). The information provided by registration will allow FDA 
to cross-check prior notice submissions against registration data to 
confirm the identity of manufacturers and others who are required to 
register. Furthermore, the information provided by prior notice 
submissions can serve as a cross-check as to whether firms are 
registered as required and have been providing the necessary updates.
    As explained in the preamble to the interim final registration rule 
published elsewhere in this issue of the Federal Register, FDA has 
concluded that the meaning of the term ``food'' in section 415 of the 
FD&C Act is ambiguous. First, the use, in section 415(a)(1) of the FD&C 
Act, of the phrase ``for consumption'' after the word ``food'' creates 
an ambiguity because it could be read to suggest that ``food'' within 
the context of the section 415 registration requirement only refers to 
food that is ordinarily thought of as ``consumed.'' By modifying the 
term ``food,'' Congress apparently intended to limit the term ``food'' 
to something less than the broad definition in section 201(f) of the 
FD&C Act. In addition, in section 415(b)(1) of the FD&C Act, when 
defining ``facility'' for purposes of section 415, Congress expressly 
exempted ``farms; restaurants; other retail food establishments; 
nonprofit food establishments in which food is prepared for or served 
directly to the consumer * * *.'' These exemptions do not make clear 
whether Congress intended them to cover only food that is ordinarily 
eaten at some point by consumers primarily for taste, aroma, or 
nutritive value or whether, for example, a retail food establishment 
could include retailers of food contact materials, such as retail 
cookware stores.
    The legislative history of section 415 of the FD&C Act also 
supports the conclusion that Congress did not speak directly to the 
meaning of ``food'' in that Bioterrorism Act provision. Such history is 
appropriately consulted at Chevron step one (Atherton v. FDIC, 519 U.S. 
213, 228-29 (1997)). In particular, the Conf. Rept. to H.R. 3448, which 
became the Bioterrorism Act, explains what Congress intended by 
``retail food establishments,'' which is used to create an exemption 
from registration.

    The Managers intend that, for the purposes of this section, the 
term 'retail food establishments' includes establishments that 
store, prepare, package, serve, or otherwise provide articles of 
food directly to the retail consumer for human consumption, such as 
grocery stores, convenience stores, cafeterias, lunch rooms, food 
stands, saloons, taverns, bars, lounges, catering or vending 
facilities, or other similar establishments that provide food 
directly to a retail consumer.

(H. Conf. Rept. No. 481, 107th Cong., 2d Sess., 133 (2002)). Similarly, 
the Conf. Rept. notes that the term ``non-profit food establishments'' 
includes not-for-profit establishments in which food is prepared for, 
or served directly to the consumer, such as food banks, soup kitchens, 
homebound food delivery services, or other similar charitable 
organizations that provide food or meals for human consumption'' (Id. 
at 133-34). Notably, the examples provided by Congress for both types 
of exempt food establishments are not those that generally sell or 
distribute food contact materials. Accordingly, the legislative history 
of section 415 of the FD&C Act creates additional ambiguity as to the 
meaning of ``food.''
    This ambiguity in the word ``food'' is further underscored by the 
legislative history of section 801(m) of the FD&C Act. For example, the 
Conf. Rept. states that the prior notice provision is to be construed 
not to apply to ``packaging materials if, at the time of importation, 
such materials will not be used for or in contact with food * * *'' 
(see H. Conf. Rept. No. 481, 107th Cong., 2d Sess., 136 (2002)). This 
statement implies that Congress was not relying on the definition of 
food in section 201(f) of the FD&C Act. For example, the statement 
could be read to mean that the term ``food'' does not include packaging 
or other materials that contact food.
    Having concluded that the meaning of ``food'' in section 801(m) of 
the FD&C Act is ambiguous, FDA has considered how to define the term to 
achieve a ``permissible construction'' of the prior notice provision 
(Chevron, USA, Inc. v. NRDC, Inc., supra at 843). In conducting this 
Chevron step two analysis, the agency has considered the same 
information evaluated at step one of the analysis (Bell Atlantic 
Telephone Co. v. FCC, 131 F. 3d 1044, 1049 (D.C. Cir. 1997); Chevron 
U.S.A., Inc. v. FERC, 193 F. Supp. 2d 54, 68 (D.D.C. 2002)). FDA has 
determined that it is permissible, for purposes of the prior notice 
provision, to exclude food contact materials from the definition of 
``food.''
    Restricting ``food'' to substances other than food contact 
materials is consistent with the legislative history of the prior 
notice provision relating to food packaging and other food contact 
substances. In addition, it is consistent with the ``food for 
consumption'' language in section 415(a)(1) (FD&C Act) of the 
registration provision. That is, foods that are ``consumed'' are 
generally those eaten for their taste, aroma, or nutritive value. In 
addition, excluding food contact materials from ``food'' in this 
regulation is consistent with the exemptions in section 415(b)(1) of 
the FD&C Act, as well as the legislative history of section 415.
    As discussed in the following paragraphs in responses to other 
comments, FDA has also interpreted ``food'' for purposes of section 
801(m) of the FD&C Act to exclude pesticides as that term is defined 
under 7 U.S.C. 136(u). Accordingly, FDA has determined that a 
reasonable interpretation of ``food'' for purposes of section 801(m) of 
the FD&C Act is as follows and has revised Sec.  1.276(b)(5) of this 
interim final rule to provide:

    Food has the meaning given in section 201(f) of the act, except 
for purposes of this subpart, it does not include food contact 
substances as defined in section 409(h)(6) of the act (21 U.S.C. 
348(h)(6)); or pesticides as defined in 7 U.S.C. 136(u). Examples of 
food include fruits, vegetables, fish (including seafood), dairy 
products, eggs, raw agricultural commodities for use as food or as 
components of food, animal feed (including pet food), food and feed 
ingredients, food and feed additives, dietary supplements and 
dietary ingredients, infant formula, beverages (including alcoholic 
beverages and bottled water), live food animals, bakery goods, snack 
foods, candy, and canned foods.


[[Page 58986]]


    Importantly, FDA still considers food packaging and other food 
contact substances to be ``food'' within the meaning of section 201(f) 
of the FD&C Act when they, or their components, migrate into other 
food. Therefore, these items are still ``food'' for purposes of the 
other provisions of section 801 of the FD&C Act (with the exception of 
section 801(l), which shares the same definition of food as section 
801(m)). Accordingly, although not subject to the section 801(m) of the 
FD&C Act requirement of prior notice, food packaging materials and 
other food contact substances will remain, as they have been, subject 
to determinations of admissibility under section 801(a) of the FD&C 
Act.
    b. Food processing aids. (Comments) One comment argues that food 
processing aids and ``indirect food additives'' should not be 
considered food for purposes of section 801(m) of the FD&C Act. 
According to the commenter, these substances resemble food contact 
substances, which Congress, as evidenced by the prior notice 
legislative history of food contact substances, did not expect FDA to 
subject to prior notice.
    (Response) Whether a food processing aid or ``indirect additive'' 
is subject to prior notice depends upon whether such a substance is 
``food'' under this rule. As noted, for purposes of the interim final 
rule, ``food'' excludes ``food contact substances'' as defined at 
section 409(h)(6) of the FD&C Act. Among other things, unlike food 
processing aids and ``indirect additives,'' ``food contact substances'' 
are not ``intended to have any technical effect in food,'' section 
4091(h)(6) of the FD&C Act. In addition, ``food'' excludes pesticides 
as defined at 7 U.S.C. 136(u). Thus, if the substance is not a 
pesticide and is intended to have a technical effect in the food being 
processed, the substance is not exempt from the definition of ``food'' 
under Sec.  1.276(b)(5) in the interim final rule. This is a reasonable 
result in that such processing aids are intentionally and directly 
added to ``traditional'' foods.
    c. Antimicrobial pesticides. (Comments) One comment expresses 
concern about including antimicrobial pesticides within the scope of 
this regulation. The comment states that pesticides are imported 
pursuant to the Federal Insecticide, Fungicide, and Rodenticide Act 
(FIFRA), not the FD&C Act, and are subject to Environmental Protection 
Agency (EPA) approval before they are admitted to the United States. 
The comment asks that FDA clarify that this regulation is not 
applicable to antimicrobial pesticides with FDA and/or EPA approved 
food contact uses. The comment states that including antimicrobial 
pesticides within the scope of this regulation would impose unnecessary 
burdens on antimicrobial pesticide registrants, without enhancing the 
protection of the food supply.
    (Response) As discussed previously, the meaning of ``food'' in 
section 801(m) of the FD&C Act is ambiguous. Therefore, FDA may define 
``food'' in a reasonable manner. FDA believes that excluding pesticides 
from the definition of food is reasonable. Pesticides, including those 
used in or on food for human or animal use, are comprehensively 
regulated by the Federal Government. Under FIFRA, 7 U.S.C. 136 et seq., 
all pesticides (both food and nonfood use) are registered with EPA. As 
part of the registration process, establishments in which pesticides 
are produced must register with EPA (40 CFR 167.3 and 167.20). As part 
of the importation process, prior notice of pesticide shipments must be 
provided to EPA (19 CFR 12.112).
    Importantly, the Federal regulatory scheme for pesticides was 
substantially revised in 1996 by the Food Quality Protection Act (FQPA) 
(Pub. L. 104-170), and EPA's authority over pesticides was consolidated 
and expanded. As a result of FQPA, pesticides and their residues are 
subject to substantial and comprehensive regulation by EPA. Where 
another Federal agency has the types of specific and comprehensive 
authority described previously to regulate the safety of a substance, 
FDA believes that it is appropriate to interpret ``food'' in section 
801(m) of the FD&C Act as not including that substance. Accordingly, 
FDA has revised the definition of ``food'' in Sec.  1.276(b)(5) to 
exclude pesticides as defined by FIFRA.
    d. Chemicals (Comments) One comment seeks clarification as to 
whether chemicals are considered ``food.'' The comment expects that 
chemicals intended for human consumption will likely be included in the 
requirements for prior notice.
    (Response) We are not sure exactly what substances or products the 
comment refers to; ``chemicals'' is a very broad term. Unless excluded 
because they are food contact substances or pesticides, chemicals that 
are ``used for food or drink'' or are ``used for components of any such 
articles'' are ``food'' under section 201(f) of the FD&C Act and the 
definition in the interim final rule (Sec.  1.276(b)(5)). If the 
substance is used in some applications that make the substance ``food'' 
and some that do not, the principles applicable to further processing 
and multi-use substances, set out in the following paragraphs, apply.
    e. Live animals. (Comments) Two comments address inclusion of live 
animals. One comment urges FDA to exempt live food animals from this 
regulation, as it will have far-reaching impacts on all Canadian 
farmers who export live food animals to the United States. The other 
comment asks for clarification as to how prior notice applies to live 
food animals imported for further processing, such as finishing.
    (Response) As discussed previously, the meaning of ``food'' in 
section 801(m) of the FD&C Act is ambiguous. Therefore, FDA may define 
``food'' in a reasonable manner. FDA believes that it is reasonable to 
interpret ``food'' in section 801(m) of the FD&C Act to include live 
animals. Such inclusion is consistent with the explicit reference to 
animals in the statutory standard, ``serious adverse health 
consequences or death to humans or animals'' in section 
801(m)(2)(B)(ii) of the FD&C Act--the provision that relates to FDA 
review of prior notices submitted for food refused for lack of adequate 
prior notice. In addition, it is consistent with the legislative 
history of section 801(m) of the FD&C Act that refers only to the 
exclusion of food contact substances. Moreover, the products of live 
food animals are an integral part of the food consumed in the United 
States, and thus, it is logical to protect the raw materials (i.e., the 
live animals) by including them under the Bioterrorism Act's 
safeguards. Finally, the inclusion of live animals in the definition of 
``food'' is consistent with the reasonable interpretation of the 
registration provision, section 415 of the FD&C Act. Accordingly, the 
interim final rule's definition of ``food'' includes live food animals. 
Defining ``food'' to include live animals is also consistent with the 
case law interpreting the term ``food'' in the broader context of the 
FD&C Act. See United States v. Tuente Livestock, 888 F. Supp. 1416 
(S.D. Ohio, 1995).
    f. Articles for further processing or capable of multiple uses. 
(Comments) Some comments ask that FDA clarify that the definition of 
``food'' does not include substances that are not edible, but may be 
further processed to be rendered edible, for example, crude vegetable 
oils, crude petroleum, and minerals such as phosphates which may be 
refined and processed into food ingredients such as glycerin and 
phosphoric acid. The comments state that where bulk commodities have 
potential food and nonfood uses, there should be an exemption from 
import notification where these commodities have not been sufficiently 
refined to be

[[Page 58987]]

directly used as food ingredients without further processing or 
refining.
    Another comment notes that gelatin is used for food, 
pharmaceutical, and technical applications and seeks assistance with 
establishing a labeling protocol to distinguish between edible gelatin, 
pharmaceutical gelatin, and technical gelatin. Some comments state FDA 
should require prior notice only for food intended for consumption and 
ask FDA to specify the articles that would be considered ``food.'' The 
comments also state that some imports have both food and nonfood uses 
and that prior notice should only be required for imports that will be 
used as a food. In addition, one comment strongly urges FDA to remove 
indirect food contact colors (i.e., material used to color food contact 
material) from the requirements of prior notice. The comment indicates 
that food contact colors are often prepared in bulk and then shipped to 
companies that can use these pigments in both food and nonfood 
applications. The process of manufacturing color pigments could be many 
steps removed from the process of actually using these products in food 
packaging. Therefore, the decision to use the product in food may not 
be made until after the pigment has entered commerce.
    (Response) For purposes of the interim final rule, ``food'' has the 
definition in section 201(f) of the FD&C Act except that ``food contact 
substances'' as defined at section 409(h)(6) of the FD&C Act and 
``pesticides'' as defined at 7 U.S.C. 136(u) are excluded from 
``food.'' Under section 201(f) of the FD&C Act, ``food'' means 
``articles used for food or drink'' (section 201(f)(1)) and articles 
``used for components of any such article'' (section 201(f)(3)). The 
determination of whether a substance is ``food'' is not a question of 
intended use (Nutrilab v. Schweiker, 713 F.2d. 335, 337 (7th Cir. 
1983); U.S. v. 52 Drums Maple Syrup, 110 F.2d 914, 915 (2d Cir. 1940); 
U.S. v. Technical Egg Products, 171 F.Supp. 326, 328 (N.D. Ga. 1959)). 
Courts interpreting the ``food'' definition in the FD&C Act have held 
that articles at both ends of the food continuum are ``food'' for 
purposes of the FD&C Act (U.S. v. O.F. Bayer & Co., 188 F.2d 555 (2d. 
Cir. 1951); U.S. v. Tuente Livestock, 888 F. Supp. 1416 (S.D. Ohio, 
1995) (live animals for food use are ``food'' under the FD&C Act); U.S. 
v. Technical Egg Products, supra, 171 F.Supp. at 328 (rotten eggs are 
``food'')). Thus, FDA believes that an item may be food even if the 
food is not yet in the form in which it will be used for food. FDA will 
consider a product as one that will be used for food if any of the 
persons involved in importing or offering the product for import (e.g., 
submitter, transmitter, manufacturer, grower, shipper, importer, owner, 
or ultimate consignee) reasonably believes that the substance is 
reasonably expected to be directed to a food use.
    If the substance can be used in some applications that make the 
substance ``food'' and some that do not, the same principles apply. 
With respect to gelatin and other substances that may exist in multiple 
grades, including food grade, FDA will consider an article one that 
will be used for food if any of the persons involved in importing or 
offering the product for import (e.g., submitter, transmitter, 
manufacturer, grower, shipper, importer, owner, or ultimate consignee) 
reasonably believes that the substance is reasonably expected to be 
directed to a food use.
    Finally, as set forth previously, the interim final rule excludes 
food contact substances from the definition of ``food.'' Thus, when 
substances to color food contact substances or their components are 
imported, they are not subject to prior notice. However, colors used in 
such substances are still subject to regulation as food under section 
201(f) of the FD&C Act for purposes of other provisions of the FD&C 
Act.
    (Interim final rule) In the interim final rule (Sec.  1.276(b)(5)), 
``food'' has the meaning given in section 201(f) of the FD&C Act, 
except for purposes of this rule, it does not include ``food contact 
substances'' as defined in section 409(h)(6) of the act (21 U.S.C. 
348(h)(6)) or ``pesticides'' as defined in 7 U.S.C. 136(u). Examples of 
food include fruits, vegetables, fish (including seafood), dairy 
products, eggs, raw agricultural commodities for use as food or as 
components of food, animal feed (including pet food), food and feed 
ingredients, food and feed additives, dietary supplements and dietary 
ingredients, infant formula, beverages (including alcoholic beverages 
and bottled water), live food animals, bakery goods, snack foods, 
candy, and canned foods.
7. Grower (Sec.  1.276(b)(6))
    Although the statute and proposed rule used the term grower, the 
proposed rule did not define the term. However, FDA solicited comments 
on whether the term ``grower'' includes a harvester or collector of 
wild products, e.g., some fish and botanicals.
    (Comments) A comment states that although harvesters or collectors 
of wild botanicals do not grow botanicals and should be differentiated 
from growers for certain purposes, these can be included in the term 
``grower'' consistent with the congressional intent in Sec.  307 of the 
Bioterrorism Act to identify the direct source of the agricultural raw 
commodity.
    (Response and interim final rule) FDA agrees. Accordingly, we have 
defined ``grower'' to mean a person who engages in growing and 
harvesting or collecting crops (including botanicals), raising animals 
(including fish, which includes seafood), or both.
8. International Mail (Sec.  1.276(b)(6))
    Although the proposed rule applied to food imported or offered for 
import by mail, see, e.g., 68 FR 5436, the proposed rule did not define 
``international mail.''
    (Comments) There were no comments received concerning any 
definition of ``international mail.''
    (Response and interim final rule) The interim final rule imposes 
slightly different requirements relating to prior notice for food 
arriving by international mail. Thus, FDA determined that a definition 
of ``international mail'' would be helpful. The interim final rule 
defines ``international mail'' to mean ``foreign national mail 
services.'' It also expressly excludes express carriers, express 
consignment operators, or other private delivery services from this 
definition.
9. No Longer In Its Natural State (Sec.  1.276(b)(8))
    Section 801(m)(1) of the FD&C Act requires that the identity of the 
manufacturer be submitted as part of a prior notice. However, the 
proposed rule did not define ``manufacturer'' or address what 
constituted the product of a manufacturer versus the product of a 
grower.
    (Comments) Comments raised questions concerning when a manufacturer 
must be identified for an article of food.
    (Response) These comments are discussed under the heading ``What 
Information Must be in a Prior Notice.'' However, as a result of the 
comments, we determined that a definition of when food would be ``no 
longer in its natural state'' would be helpful to clarify when the 
identity of a manufacturer versus the identity of a grower must be 
provided in a prior notice.
    (Interim final rule) The interim final rule (Sec.  1.276(b)(8)), 
defines the term ``no longer in its natural state'' to mean that an 
article of food has been made from one or more ingredients or 
synthesized, prepared, treated, modified, or manipulated. Examples of 
activities that render food no longer in its natural state are cutting, 
peeling, trimming, washing, waxing, eviscerating, rendering, cooking, 
baking, freezing, cooling,

[[Page 58988]]

pasteurizing, homogenizing, mixing, formulating, bottling, milling, 
grinding, extracting juice, distilling, labeling, or packaging. 
However, crops that have been cleaned (e.g., dusted, washed), trimmed, 
or cooled attendant to harvest or collection or treated against pests, 
waxed, or polished are still in their natural state for purposes of the 
prior notice interim final rule. Likewise, whole fish headed, 
eviscerated, or frozen attendant to harvest are still in their natural 
state for purposes of the prior notice interim final rule.
10. Port of Arrival (Sec.  1.276(b)(9)) and Port of Entry (Sec.  
1.276(b)(10))
    The proposed rule defined ``port of entry'' as ``the water, air, or 
land port at which the article of food is imported or offered for 
import into the United States, i.e., the port where food first arrives 
in the United States.''
    (Comments) Many comments suggest harmonizing with, or adopting, the 
CBP definition for ``port of entry.'' In the opinion of two comments, 
the CBP definition is consistent with congressional intent and the FDA 
departure from the CBP definition is unsupported. Many of these 
comments state the two definitions would cause confusion in the import 
community and could delay proper prior notice. Other comments suggest 
changing the FDA definition of ``port of entry'' to the ``port of 
arrival.'' Another comment suggests defining ``port of entry'' as the 
entering point of a country where the merchandise is checked by 
official authorities. Two comments state that defining ``port of 
entry'' as the port of arrival would change business practices by 
essentially stopping the use of CBP ``in-transit'' (i.e., IT) entries 
under bond to inland ports.
    (Response) Section 801(m)(2)(A) of the FD&C Act states that FDA's 
implementing regulations must require that the notice ``be provided by 
a specified period of time in advance of importation of the article 
involved * * *.'' The stated purpose of section 801(m)(1) is ``enabling 
[articles of food] to be inspected at ports of entry into the United 
States * * *.'' Moreover, the overall purpose of the Bioterrorism Act 
is ``[t]o improve the ability of the United States to prevent, prepare 
for, and respond to bioterrorism and other public health emergencies.'' 
(Pub. L. 107-188.) The ability to examine or, if necessary, hold a 
suspect article of food when it first arrives at a port of entry in the 
United States, rather than later at the port where CBP will process the 
entry, will most effectively serve this overall purpose. Thus, to 
ensure that there is clarity that prior notice must be provided in 
advance of arrival, we are defining the term ``port of arrival'' as the 
water, air, or land port at which the article of food is imported or 
offered for import into the United States, i.e., the port where the 
article of food first arrives in the United States.
    In addition, we are adopting the CBP definition of ``port of 
entry'' to allow flexibility when designating where refused merchandise 
will be held. The CBP ``Port of entry'' definition states:
    The terms ``port'' and ``port of entry'' refer to any place 
designated by Executive order of the President, by order of the 
Secretary of the Treasury, or by Act of Congress, at which a Customs 
officer is authorized to accept entries of merchandise to collect 
duties, and to enforce the various provisions of the Customs and 
navigation laws. The terms ``port'' and ``port of entry'' incorporate 
the geographical area under the jurisdiction of a port director. (The 
Customs ports in the Virgin Islands, although under the jurisdiction of 
the Secretary of the Treasury, have their own Customs laws (48 U.S.C. 
1406(i)). These ports, therefore, are outside the Customs territory of 
the United States and the ports thereof are not ``port of entry'' 
within the meaning of these regulations) (19 CFR 101.1).
    This flexibility will ensure that food that has been refused may 
move to the port of destination where, for example the consumption or 
warehouse entry will be filed, unless directed by CBP or FDA. 
Generally, we do not intend to hold shipments at the border unless our 
assessment of the situation leads us to believe it is warranted, e.g., 
the food may present a serious risk to public health or that the prior 
notice violation is egregious. We intend to implement prior notice, 
both in terms of determining what warrants a refusal in the first 
place, and in terms of determining which shipments may move to the port 
of destination, in a risk-based way.
    (Comments) Other comments state rail transportation would be 
especially affected because inbound trains often are not required to 
stop at the U.S. border but proceed to inland terminals.
    (Response) As explained later, rail shipments that have been 
refused admission per section 801(m)(1) of the FD&C Act are considered 
to have the status of general order merchandise. In many cases, it will 
be operationally difficult to stop an entire train because an article 
of food on it has been refused admission because of inadequate prior 
notice. Under CBP regulation, general order merchandise may be stored 
by the carrier or as the CBP port director may direct (see 19 CFR 
123.10(f)). Moreover, in situations involving shipments by rail, FDA 
and CBP have the discretion to allow the movement of the cargo from the 
border crossing to the nearest point where it can be safely and 
securely held. We intend, whenever possible, to examine articles of 
food arriving by rail at the appropriate examination site closest to 
the border. However, if the shipment might pose an immediate danger to 
public health and safety, an article of food arriving by train may be 
held at the border pending resolution of the situation.
    (Interim final rule) The interim final rule, Sec.  1.276(b)(9) 
defines ``port of arrival'' as ``the water, air, or land port at which 
the article of food is imported or offered for import into the United 
States, i.e., the port where the article of food first arrives in the 
United States,'' (Sec.  1.276(b)(9)). This port may be different from 
the port where consumption or warehouse entry or FTZ admission 
documentation is presented to CBP. The interim final rule (Sec.  
1.285(b)(10)) also defines port of entry as follows:
11. Registration Number (Sec.  1.276(b)(11))
    Although the term appears in several places in the proposed rule, 
the term ``registration number'' was not defined.
    (Comments) No comments addressed the definition or meaning of 
``registration number.''
    (Response) To clarify that the term refers to registration of food 
facilities, the interim final rule defines ``registration number'' as 
the registration number assigned by FDA under section 415 of the FD&C 
Act and 21 CFR part 1, subpart H, Sec.  1.276(b)(11). Specific comments 
addressing when a registration number is required and other aspects of 
providing registration numbers as information submitted in prior notice 
are addressed later in this preamble--see ``What Information Must be in 
a Prior Notice?'.
12. Shipper (Sec.  1.276(b)(12))
    Section 801(m)(1) of the FD&C Act requires that the ``shipper of 
the article'' be provided in a prior notice submission. The proposed 
rule included the shipper as required information in a prior notice, 
but did not define the term ``shipper.''
    (Comments) FDA received no comments concerning the meaning of this 
term.
    (Response) In the proposed rule, we described the ``shipper'' as 
``the person who arranges for a shipment to get to its first 
destination in the United States * * *. The shipper is usually a 
foreign firm that is located or maintains an address in the country 
from which the

[[Page 58989]]

article was shipped.'' (68 FR 5437). However, in drafting the interim 
final rule, we have realized that this description was not written in a 
way that was useful in identifying the shipper in the case of food 
imported by international mail. Accordingly, we have revised the 
description of the ``shipper'' and included it in the definitions to 
make it easier to find.
    The definition is based on the description of ``shipper'' used by 
CBP in their proposed rule, ``Required Advance Electronic Presentation 
of Cargo Information,'' published in the Federal Register on July 23, 
2003 (68 FR 43574 at 43577), which is similar to, but clearer than, the 
description we used in the preamble to the proposed prior notice rule.
    (Interim final rule) The interim final rule (Sec.  1.276(b)(12)), 
defines ``shipper'' as ``the owner or exporter of the article of food 
who consigns and ships the article from a foreign country or the person 
who sends an article of food by international mail to the United 
States.''
13. United States (Sec.  1.267(b)(13))
    Although the term appears in several places in section 801(m) of 
the FD&C Act itself, the proposed rule did not contain a definition of 
``United States.''
    (Comments) A comment seeks clarification whether the prior notice 
regulation applies to food imported into Guam, the U.S. Virgin Islands, 
the Northern Mariana Islands, and other U.S. Territories.
    (Response) This comment raises the question of what the term 
``United States'' means for purposes of section 801(m) of the FD&C Act. 
In construing the prior notice provision of the Bioterrorism Act, FDA 
is confronted with two questions. First, has Congress directly spoken 
to the precise question presented? (``Chevron step one'') (Chevron, 
U.S.A., Inc. v. NRDC, Inc., 467 U.S. 837, 842 (1984)). To find no 
ambiguity, Congress must have clearly manifested its intention with 
respect to the particular issue (Young v. Community Nutrition 
Institute, 476 U.S. 974, 980 (1986)). If Congress has spoken directly 
and plainly, the agency must implement Congress's unambiguously 
expressed intent (Chevron, 467 U.S. at 842-843). If, however, the 
Bioterrorism Act is silent or ambiguous as to the meaning of ``United 
States,'' FDA may define ``United States'' in a reasonable fashion 
(``Chevron step two''); (Chevron, 467 U.S. at 842-843; FDA v. Brown & 
Williamson Tobacco Corp., 529 U.S. 120, 132 (2000)). The agency has 
determined that, in enacting section 801(m) of the FD&C Act, Congress 
did not speak directly and precisely to the meaning of ``United 
States.''
    The FD&C Act does apply to Guam, the U.S. Virgin Islands, the 
Northern Mariana Islands, and other U.S. Territories. Section 201(a)(1) 
of the FD&C Act (21 U.S.C. 321 (a)(1)) defines the term ``State'' to 
mean any State or Territory of the United States, the District of 
Columbia, and the Commonwealth of Puerto Rico. The term ``Territory'' 
is defined to mean any Territory or possession of the United States, 
including the District of Columbia, and excluding the Commonwealth of 
Puerto Rico and the Canal Zone, section 201(a)(2) of the FD&C Act (21 
U.S.C. 321(a)(2)). However, the terms ``State'' and ``Territory'' are 
not used in section 801(m) of the FD&C Act.\3\ Instead, section 801(m) 
of the FD&C Act deals with ``articles imported or offered for import 
into the United States,'' (section 801(m)(1)).
---------------------------------------------------------------------------

    \3\ The terms ``State'' and ``Territory'' are key to the FD&C 
Act's definition of ``interstate commerce,'' which is, in turn, key 
to many of the FD&C Act's general inspection and enforcement 
provisions, see, e.g., sections 301, 304, and 704 (21 U.S.C. 331, 
334, and 374). However, while articles that ``are imported or 
offered for import into the United States,'' section 801(m)(1) of 
the FD&C Act, are in ``interstate commerce,'' see, e.g., U.S. v. 
2,998 Cases * * * First Phoenix Group, Ltd, 64 F.3d 984 (5th Cir. 
1995), the term ``interstate commerce'' does not appear in section 
801(m).
---------------------------------------------------------------------------

    The term ``United States'' is not defined in the FD&C Act's general 
definitions in section 201. Nor is it defined in section 801(m) of the 
FD&C Act. It is defined for purposes of section 702(a) of the FD&C Act 
(21 U.S.C. 372(a)), which provides:

    In the case of a food packed in the Commonwealth of Puerto Rico 
or a Territory [FDA] shall attempt to make inspection of such food 
at the first point of entry within the United States * * *. For the 
purposes of this subsection, the term 'United States' means the 
States and the District of Columbia.

This definition in section 702(b) seems to imply that, in other places 
in the FD&C Act, the term ``United States'' would include all 
Territories. However, in section 801(m) of the FD&C Act, the term 
``United States'' appears as part of the phrase ``for purposes of 
enabling inspection of such [food] articles at the ports of entry into 
the United States'' (emphasis added). As defined by CBP, ``port of 
entry'' means ports within the part of the United States that has been 
denominated as the ``Customs territory of the United States.'' (19 CFR 
101.1 and 101.3). Notably, though, the Territories are not considered 
part of the Customs territory of the United States. CBP defines 
``Customs territory of the United States'' to ``include[] only the 
States, the District of Columbia, and Puerto Rico.'' (19 CFR 101.1).
    Because of this reference to ``the ports of entry into the United 
States,'' FDA has concluded that the term ``United States'' is best 
interpreted in section 801(m) of the FD&C Act to be the Customs 
territory of the United States and include only the 50 States, the 
District of Columbia, and Puerto Rico, but not the U.S. Territories and 
possessions. Defining the ``United States'' to be the Customs territory 
of the United States will maximize FDA's ability to coordinate prior 
notice with the CBP entry process, as CBP entry is made for articles 
from the Territories when they arrive in the Customs territory of the 
United States. Thus, section 801(m) of the FD&C Act does not apply to 
articles of food imported or offered for import into Guam, the U.S. 
Virgin Islands, the Northern Mariana Islands, and other U.S. 
Territories; section 801(m) does apply, however, when articles of food 
are imported or offered for import from the Territories into the United 
States as defined by Sec.  1.276(b)(11) of the interim final rule.
    (Interim final rule) The interim final rule (Sec.  1.276(b)(13)), 
defines ``United States'' to mean the Customs territory of the United 
States, i.e., the 50 States, the District of Columbia, and the 
Commonwealth of Puerto Rico, but not any other part of the United 
States.
14. You (Sec.  1.276(b)(14))
    The proposed rule defined ``you,'' based on who was authorized to 
submit prior notice, as ``the purchaser or importer of an article of 
food who resides or maintains a place of business in the United States, 
or an agent who resides or maintains a place of business in the United 
States acting on the behalf of the U.S. purchaser or importer or the 
arriving carrier * * *'' or, if known, the in-bond carrier.
    (Comments) No comments were received concerning the definition of 
``you.'' However, comments were received about who may submit prior 
notice.
    (Response) Discussion of those comments and our responses are found 
in the section ``Who is Authorized to Submit Prior Notice?'' FDA 
decided, based on revisions to who may submit prior notice, to revise 
the definition of ``you.'' The interim final rule clarifies that 
``you'' means the persons (i.e., individuals and firms) submitting or 
transmitting the prior notice. The submitter is responsible for the 
prior notice. The persons who send the prior notice are transmitters. 
If the submitter sends the prior notice, he or she is both

[[Page 58990]]

the submitter and transmitter. FDA notes that all messages sent via the 
FDA PN System Interface will be sent to the transmitter. If prior 
notice is submitted via ABI/ACS, all messaging goes to the customs 
broker or self-filer via ABI/ACS.
    (Interim final rule) The interim final rule (Sec.  1.276(b)(14)), 
defines ``you'' as the person submitting the prior notice (the 
``submitter'') or the person transmitting prior notice information on 
behalf of the submitter (the ``transmitter'').
13. Summary of the Interim Final Rule
    The interim final rule defines the following terms:

    [sbull] The act;
    [sbull] Calendar day;
    [sbull] Country from which the article originates;
    [sbull] Country from which the article is shipped;
    [sbull] FDA Country of Production;
    [sbull] Food;
    [sbull] Grower;
    [sbull] International mail;
    [sbull] No Longer in Its Natural State;
    [sbull] Port of arrival;
    [sbull] Port of entry;
    [sbull] Registration Number;
    [sbull] Shipper;
    [sbull] United States; and
    [sbull] You.

D. ``What Is the Scope of This Subpart?'' (Section 1.277 Proposed as 
Sec.  1.276)

    FDA proposed that the prior notice requirements apply to food for 
humans and other animals that is imported or offered for import into 
the United States. The proposed rule specified that this included food 
that is imported or offered for import into U.S. FTZs, for consumption, 
storage, immediate export from the port of entry, transshipment through 
the United States to another country, or import for export. The 
proposed rule said that prior notice did not apply to food carried by 
an individual in that individual's personal baggage for that 
individual's personal use, meat food products, poultry products, and 
egg products that are subject to the exclusive jurisdiction of USDA.
    (Comments) Some comments state that the prior notice requirements 
should not apply to food that is brought across the U.S. border but not 
for consumption in the United States. In particular, the comments focus 
on food exported from the port of arrival, food imported for 
transshipment and export from another port, and food imported for 
further processing and export. The comments argue that Congress did not 
envision that the prior notice requirements would cause importers to 
give notice of food not for consumption within the United States and 
that notice of such food would not give FDA any useful or actionable 
information. One comment states that the Bioterrorism Act repeatedly 
refers to ``offered for import into the United States'' and concludes, 
based on this phrase, that prior notice should apply only to food for 
consumption by the citizens of the United States. One comment points to 
statutory language that stipulates ``for human and animal 
consumption.'' Based on this language, the comment argues that FDA 
would exceed its statutory authority by requiring prior notice for 
shipments not intended for consumption within the United States. 
Another comment states that prior notice should not apply to food of 
U.S. origin, especially if it was simply transshipped through another 
country then ``re-imported'' into the United States.
    (Response) These comments on scope raise the question of what 
Congress intended the phrase ``imported or offered for import into the 
United States'' to mean for purposes of section 801(m) of the FD&C Act. 
In construing the prior notice provision of the Bioterrorism Act, FDA 
is confronted with two questions. First, has Congress directly spoken 
to the precise question presented? (``Chevron step one''). (Chevron, 
U.S.A., Inc. v. NRDC, Inc., 467 U.S. 837, 842 (1984)). To find no 
ambiguity, Congress must have clearly manifested its intention with 
respect to the particular issue (Young v. Community Nutrition 
Institute, 476 U.S. 974, 980 (1986)). If Congress has spoken directly 
and plainly, the agency must implement Congress's unambiguously 
expressed intent (Chevron, 467 U.S. at 842-843). If, however, the 
Bioterrorism Act is silent or ambiguous as to the meaning of ``imported 
or offered for import into the United States,'' FDA may interpret the 
phrase in a reasonable fashion (``Chevron step two''); (Chevron, 467 
U.S. at 842-843; FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120, 
132 (2000)).
    The agency has determined that, in enacting section 801(m) of the 
FD&C Act, Congress did not speak directly and precisely to the meaning 
of ``imported or offered for import into the United States.'' For the 
reasons in the following paragraphs, FDA has determined that, for 
purposes of section 801(m) of the FD&C Act, the phrase ``imported or 
offered for import into the United States'' can reasonably be 
interpreted to apply to articles that are brought into the United 
States for consumption in the United States, for transshipment through 
the United States and export to another country, for further processing 
in the United States and export, and articles of U.S. origin that are 
``re-imported'' back into the United States. We have also determined 
that the phrase ``imported or offered for import into the United 
States'' can reasonably be interpreted to exclude articles that are 
brought to the United States for the purpose of being exported without 
ever leaving the port of arrival until export.
    Neither the Bioterrorism Act nor the FD&C Act defines this phrase. 
Moreover, courts that have considered the meaning of ``import'' or 
similar terms in other statutes have not always arrived at the same 
conclusions: Sometimes ``import'' means simply to bring in, but other 
times ``import'' means to bring in with the intent to unlade or enter 
(Procter & Gamble Manufacturing Co. v. U.S., 19 C.C.P.A. 415, 422 
(C.C.P.A. 1932) (to import ``may mean to bring goods within the 
jurisdictional limits of the country * * *; or it may mean the time 
when it is withdrawn from the warehouse and enters the commerce of the 
country''); compare, e.g., Canton R. Co. v. Rogan, 340 U.S. 511, 514-15 
(1951) (``to import means to bring into the country''); Brown v. 
Maryland, 25 U.S. 419, 426, 437-38 (1827) (``What, then, are `imports'? 
The lexicon informs us, they are `things imported.' If we appeal to 
usage for the meaning of the word, we shall receive the same answer. 
They are the articles themselves which are brought into the country.'') 
with United States v. Watches, Watch Parts, Calculators & Misc. Parts, 
692 F. Supp. 1317, 1321 (S.D. Fla. 1988); United States v. Commodities 
Export Co., 14 C.I.T. 166, 169-70 (Ct. Int'l Trade 1990) (``once goods 
are within the jurisdictional limits of the United States with the 
intent to discharge, they are imports under this definition''); United 
States v. Boshell, 14 U.S. Cust. App. 273, 275-77 (Ct. Cust. App. 1922) 
(``The common ordinary meaning of the word `import' is to bring in. 
Imported merchandise is merchandise that has been brought within the 
limits of a port of entry from a foreign country with intention to 
unlade, and the word `importation' as used in tariff statutes, unless 
otherwise limited, means merchandise to which that condition or status 
has attached'')).
    In considering what is a reasonable interpretation, we considered 
the language and purpose of section 801(m) of the FD&C Act, as well as 
the other provisions of the Bioterrorism Act and section 801 of the 
FD&C Act. Section 801(m)(1) of the FD&C Act states, ``In the case of an 
article of food that is

[[Page 58991]]

being imported or offered for import into the United States, the 
Secretary * * * shall by regulation require * * * the submission to the 
Secretary of a notice * * *.'' FDA notes that Congress did not 
explicitly limit this provision to articles of food that are intended 
for consumption in the United States. However, such limiting language 
does appear in section 415 of the FD&C Act, which requires certain food 
facilities to register with the agency. This shows that when Congress 
crafted the Bioterrorism Act, it knew how to impose the limitation 
sought by the comments. But neither section 801(m) of the FD&C Act nor 
its legislative history contains language suggesting this limitation.
    The purpose of the Bioterrorism Act is ``to improve the ability of 
the United States to prevent, prepare for, and respond to bioterrorism 
and other public health emergencies.'' The prior notice provision 
furthers this goal by enhancing the agency's ability to inspect 
imported food upon arrival in the United States. Excluding from prior 
notice food that is brought into the United States for transshipment or 
further processing, rather than consumption, would run counter to the 
purpose of the Bioterrorism Act. Articles entered at the port or 
arrival under T&E entries with the stated intent to transship and 
export may be diverted for consumption in the United States and thus 
remain here rather than leave from another port. Some of this diversion 
is legitimate; under CBP regulations, importers may change their minds 
and file a superseding consumption entry. In addition, unscrupulous 
importers may file a T&E entry instead of a consumption entry to avoid 
paying duties on foods for consumption in the United States. 
Unscrupulous importers may also file a T&E entry instead of a 
consumption entry to try to avoid FDA review of their merchandise: 
generally, FDA does not receive any notice of these kinds of entries 
from CBP because these entries are not filed through ABI/ACS.
    If we were to interpret ``imported or offered for import'' to 
exclude those entries, we could be creating a significant potential gap 
in section 801(m) of the FD&C Act's coverage. An importer could simply 
bring in an article of food under a T&E entry without giving prior 
notice and then, as allowed by CBP regulations, file a consumption or 
other entry. Thus, this exclusion would create a loophole that could be 
exploited by those who want to avoid giving prior notice, even for 
articles of food that are for consumption in the United States. Given 
the stated purposes of the Bioterrorism Act and of section 801(m) of 
the FD&C Act, FDA has concluded that it is reasonable to interpret 
``imported or offered for import into the United States'' to include 
articles of food entered for transshipment and exportation.
    Section 801(a) of the FD&C Act sets out the basic admissibility 
procedure and standards for foods, drugs, devices, and cosmetics, 
``which are being imported or offered for import into the United 
States.'' As with section 801(m) of the FD&C Act, nothing in section 
801(a) limits its requirements just to articles that are intended for 
consumption in the United States. Indeed, section 801(d)(3) of the FD&C 
Act exempts from section 801(a)'s admissibility standards certain 
drugs, devices, food additives, color additives, and dietary 
supplements if these items are intended at the time of ``importation'' 
for further processing or incorporation into a product that will be 
exported. This exemption is only necessary if the phrase ``imported or 
offered for import'' in section 801(a) includes the bringing into the 
country of some types of goods that are for processing but not 
consumption in the United States. Thus, in the context of section 
801(a) of the FD&C Act, ``imported or offered for import into the 
United States'' applies to more than food intended for consumption in 
the United States. Finally, section 801(d)(1) of the FD&C Act, which 
limits the circumstances under which U.S.-made drugs can be imported 
back into the United States, makes it clear that the phrase ``imported 
or offered for import'' in section 801(a) applies to items made in the 
United States, exported, and then ``re-imported.''
    In light of the text of section 801(m) of the FD&C Act, its 
purpose, and these other provisions in section 801, we believe it is 
reasonable that this interim final rule applies to food that is brought 
into the United States for ``consumption'' (immediate or otherwise) in 
the United States, for transshipment through the United States and 
export, or for further processing in the United States and export 
(often referred to as ``import for export''), and to food that is ``re-
imported.'' In addition, FDA has concluded in this interim final rule 
that there are compelling policy reasons for adopting this reasonable 
definition of ``imported,'' ``offered for import,'' and 
``importation.''
    However, when it comes to articles that are imported then exported 
directly from their port of arrival, we have concluded that it is 
reasonable to interpret the term ``imported or offered for import'' to 
exclude them from the prior notice requirements.
    Food that is brought to a U.S. port but is then directly exported 
from that port of arrival is entered under a CBP IE entry and subject 
to the limitations of an IE bond. In essence, this food may not leave 
the port of arrival until export. These imports are thus subject to 
almost identical restrictions as food that is refused under section 
801(m)(1) of the FD&C Act--foods that are imported under an IE entry 
may not leave the port of arrival unless exported. Given that controls 
already exist to ensure that these articles are not released from the 
port of arrival, FDA believes that it is reasonable to interpret 801(m) 
as excluding these imports from section 801(m) of the FD&C Act's prior 
notice requirements.
    (Comments) One comment asks that other products covered by USDA 
programs (such as products included in ``CFR(Q37)'') be exempt from 
prior notice in the same manner as foods under the exclusive 
jurisdiction of USDA.
    (Response) The comment did not provide more detail concerning what 
program is referred to by ``CFR(Q37).'' As set out in section 
801(m)(b)(3)(B) of the FD&C Act, the interim final rule provides that 
meat food products, poultry products, and egg products that are subject 
to the exclusive jurisdiction of the USDA under the Federal Meat 
Inspection Act (21 U.S.C. 601 et seq.), the Poultry Products Inspection 
Act (21 U.S.C. 451 et seq.), or the Egg Products Inspection Act (21 
U.S.C. 1031 et seq.) are not subject to FDA's prior notice 
requirements. With regard to other USDA programs, section 315 of the 
Bioterrorism Act states that no part of Title III should be construed 
to alter the jurisdiction between USDA and FDA. Notably, under current 
practice, FDA may have jurisdiction over an imported food under the 
FD&C Act and USDA may have jurisdiction over an imported food under one 
or more statutes that it administers, or the two agencies may have 
joint jurisdiction over an imported food. Under its section 315, the 
Bioterrorism Act does not change this structure. Accordingly, only 
imported food that is regulated exclusively by USDA is exempt from 
prior notice.
    In addition, we believe that the statute requires prior notice to 
be submitted to FDA. As described elsewhere in greater detail, we are 
working with CBP to modify our existing ABI/ACS and OASIS systems to 
permit additional data sharing to satisfy prior notice. Although it is 
theoretically possible for FDA to obtain information from agencies 
other than CBP, the stringent

[[Page 58992]]

timeframes for issuing this interim final rule do not provide FDA 
adequate time to reconcile the different information required or to 
work with the other agencies to have them amend their existing 
requirements to capture all the information FDA needs. Merely obtaining 
existing information about the food from other agencies would not 
guarantee that FDA has the information required by section 801(m) of 
the FD&C Act's prior notice requirements because there is wide 
variation in the purposes and information required by other government 
programs. We would also need to work with other agencies to ensure the 
confidentiality of nonpublic prior notice information under relevant 
information disclosure laws, e.g., 21 CFR 20.85 (Federal), 20.88 
(State), and 20.89 (foreign). Because a purpose of providing prior 
notice to FDA is to assist FDA in responding to bioterrorism incidents 
or other food-related emergencies, FDA must have the required 
information readily accessible. If FDA has to coordinate with other 
agencies or governments to obtain from them the information necessary 
to respond to such an emergency, FDA may be prevented from responding 
to the emergency in a timely manner.
    FDA notes that it is dedicated to increasing information-sharing 
capabilities with other agencies even after this interim rule is in 
effect, and we will continue to work with other government agencies to 
further streamline the prior notice process, consistent with our 
statutory obligations.
    (Comments) Several comments suggest that exclusion for baggage in 
the proposed rule should be broadened in the final rule to include all 
food in baggage, even food that is not for the traveler's personal use. 
For example, one comment reasons that samples carried in the baggage of 
company representatives (or sent unaccompanied) generally do not enter 
commercial trade.
    (Response) FDA disagrees. Except as already provided for, section 
801(m) of the FD&C Act does not authorize an exclusion from prior 
notice for all food imported or offered for import into the United 
States in baggage. In the preamble to the proposed rule, we explained 
that the information that section 801(m)(1) of the FD&C Act requires in 
a prior notice, in conjunction with the purpose of the provision, 
demonstrates that Congress did not intend prior notice to apply to food 
that travelers bring into the United States in their personal baggage 
for personal use (i.e., consumption by themselves, family or friends, 
not for sale or other distribution). We reasoned that when travelers 
bring food back from their travels in their personal baggage for their 
own use, we do not believe that Congress intended for us to 
characterize such travelers as ``shippers'' for purposes of section 
801(m) of the FD&C Act.
    When food is not being carried by or otherwise accompanying an 
individual for his or her personal use, there is a ``shipper''--the 
person or entity on whose behalf the traveler is bringing in the food. 
Thus, by its terms, section 801(m) of the FD&C Act requires that food 
carried by or otherwise accompanying an individual arriving in the 
United States that is not for personal use be subject to prior notice. 
In addition, were we to adopt such an exemption, it would create a 
potentially significant loophole, which could defeat the purpose of 
prior notice. For example, travelers coming from Latin America 
sometimes carry local soft cheeses for sale in the United States (Ref. 
16). In fact, these travelers often are not staying in the United 
States for any period of time, but are merely transporting cheese to 
sell in the United States in their luggage or baggage. These cheeses 
have been tested by FDA and found positive for listeria, salmonella, 
and other pathogens associated with raw milk and insanitary conditions. 
Consumption of such contaminated cheese has been associated with 
illnesses and deaths. Another example is travelers arriving by 
automobile who carry cases of shellfish from unapproved foreign growing 
locations. These shellfish may be contaminated with a variety of 
illness-causing pathogens including vibrio cholerae or Norwalk virus. 
These shellfish are often not destined for personal consumption but for 
sale directly to the public or for consumption by the public at 
restaurants. Finally, trade samples are imported or offered for import 
to generate sales, which is a commercial, not personal, use. Thus, 
there is a ``shipper'' when these samples are brought to the United 
States.
    FDA notes that it is changing the proposed rule by removing the 
term ``baggage'' and referring instead to food carried by or otherwise 
accompanying an individual. This change clarifies that the exclusion 
applies to food that might not be regarded as ``baggage'' but, 
nonetheless, accompanies the traveler. For example, food in the trunk 
of a car is not in baggage, but it accompanies the driver and any 
passengers.
    (Comments) Comments ask that any food imported for personal use 
which arrives in the country by common carrier (e.g., express carrier, 
truck, plane) should be treated the same as food imported for personal 
use and carried with a traveler.
    (Response) FDA disagrees. Section 801(m) of the FD&C Act does not 
authorize a broad exclusion from prior notice for all food imported or 
offered for import for personal use. In the preamble to the proposed 
rule, we explained that the information that section 801(m)(1) of the 
FD&C Act requires in a prior notice, in conjunction with the purpose of 
the provision, demonstrates that Congress did not intend prior notice 
to apply to food that travelers bring into the United States in their 
personal baggage for personal use (i.e., consumption by themselves, 
family or friends, not for sale or other distribution). We reasoned 
that when travelers bring food back from their travels in their 
personal baggage for their own use, we do not believe that Congress 
intended to characterize such travelers as ``shippers'' for purposes of 
section 801(m) of the FD&C Act. However, when food is shipped by an 
individual or business in another country to a consumer in the United 
States for his or her personal use (or otherwise), there is a 
``shipper'' as that term is used in section 801(m)(1) of the FD&C Act 
and defined in Sec.  1.276(b)(10). Accordingly, there is no basis in 
section 801(m) of the FD&C Act for concluding that Congress did not 
intend prior notice to apply to articles sent (as opposed to carried) 
to the United States for the recipients' personal use.
    (Comments) One comment asked that FDA address the issue of 
noncommercial family food shipments and to add these to the list of 
exemptions from prior notice. Another comment stated that a food 
shipment consisting of one noncommercial shipper sending food to 
another noncommercial recipient (e.g., a friend abroad shipping cookies 
to a friend in the United States) should be outside the scope of the 
prior notice requirement.
    (Response) FDA agrees in part and we have added a provision that 
excludes personal gifts of homemade food from prior notice. Although we 
believe that this food is imported into the United States, the 
information that Sec.  801(m)(1) of the FD&C Act requires in a prior 
notice, in conjunction with the purpose of the provision, demonstrates 
that Congress did not intend prior notice to apply to homemade food 
sent as a personal gift by the maker to a recipient in the United 
States. In particular, under Sec.  801(m)(1) of the FD&C Act, a prior 
notice must contain the identity of the manufacturer of the food. When 
an individual makes a food in their home as a gift for a relative or 
friend, we do not believe that Congress intended for

[[Page 58993]]

us to characterize such cooks as ``manufacturers'' for purposes of 
Sec.  801(m) of the FD&C Act.
    (Comments) Several comments suggest that the final rule should not 
apply to foods that arrive by international mail or express carriers.
    (Response) FDA disagrees. Except for the exclusions already 
described for food for personal use that is carried by or otherwise 
accompanying a traveler and homemade gifts, section 801(m) of the FD&C 
Act applies to food regardless of the method of importation. Thus, 
foods that arrive by international mail and by express carriers (e.g., 
Federal Express, United Parcel Service, etc.) are subject to section 
801(m)'s prior notice requirements. Indeed, FDA notes that foods, 
drugs, devices, and cosmetics that arrive by mail or express carriers 
are currently subject to admissibility determinations under section 
801(a) of the FD&C Act, which also uses the phrase ``imported or 
offered for import.'' Finally, were we to adopt such an exemption, it 
would create a potentially significant loophole, which could defeat the 
purpose of prior notice. Those who did not want to or could not comply 
with prior notice requirements would be able to bring articles of food 
in by mail or express carrier. While this might not be practical for 
all kinds of foods, many foods are regularly imported by mail or 
express carrier, e.g., dietary supplements and specialty foods ordered 
by U.S. consumers from foreign firms. For example, one commenter states 
its company provides, through Internet sales, special dietary foods and 
fresh baked foods that are shipped via express carriers directly to 
consumers at the rate of around 1,000 home deliveries per week.
    (Comments) Several comments suggest that the final rule should not 
apply to various kinds of samples, including trade and market research 
samples (i.e., samples sent or carried in for the purpose of selling 
products or conducting market research), trade show samples, samples 
for testing for nutritional, safety, quality control, or quality 
assurance reasons, and samples for basic research. These comments 
reason that samples used for marketing are not intended for retail 
consumption and generally do not enter commercial trade and, thus, are 
not intended for use as food. In the case of samples for testing, 
comments reason that these samples are for the individual's specific 
and limited personal use and not for further distribution to others and 
should be exempted as samples are under federal poultry and meat 
inspection regulations.
    (Response) FDA agrees in part. If the samples are items that are in 
such early stages of research and development that they cannot yet be 
considered food under Sec.  1.276(b)(5) of the interim final rule, they 
would not be subject to prior notice requirements. An example of such 
an item is a substance being tested for possible preservative qualities 
before being tested in any food. However, samples of food, including 
those for test marketing, are clearly subject to prior notice as they 
are ``articles of food imported or offered for import'' as stated in 
section 801(m) of the FD&C act. For example, in the summer of 2003, FDA 
received a report from a poison control center in country T concerning 
the acute poisoning of 9 men (one died) from ingestion of an herbal 
fermented wine. Symptoms occurred within minutes. Reports indicated 
that this product may have been exported to the United States in small 
quantities for test marketing in restaurants. This underscores the 
importance of FDA receiving prior notice of all food imported or 
offered for import.
    (Comments) One comment suggests that food for research and 
development purposes sent directly to facilities that are registered 
under section 415 of the FD&C Act should be exempt.
    (Response) If the item is indeed food under this subpart and it is 
not otherwise excluded under Sec.  1.277(b), prior notice is required. 
There is no basis in the statute for an exemption based on the fact 
that an article of food is being sent to registered facilities.
    (Comments) Comments ask that articles of food that are of de 
minimis value (i.e., less than $200) be exempt from prior notice. The 
comments argue that such small shipments for personal use could hardly 
qualify as a risk to the domestic food supply. They also point out that 
enforcing prior notice on such articles would be difficult and 
burdensome to FDA. In addition, they state that prior notice for these 
items would be a burden on consumers as they usually do not have an 
agent in the United States to represent them.
    (Response) FDA notes that it has removed the restrictions on who 
can submit prior notice. Thus, foreign sellers or shippers can file 
prior notices for these kinds of shipments under the interim final 
rule. Low-value food items are clearly subject to the terms of section 
801(m) of the FD&C Act as they are ``articles of food imported or 
offered for import'' as stated in section 801(m). Moreover, we do not 
agree that low value shipments are always imported for personal use or 
would present only de minimis risks, such that an exemption can be 
justified under the de minimis doctrine. First, a low value is not 
necessarily a good indication that the article is for personal use. 
Many food items (e.g., produce) can have a low invoice value at 
importation, especially if the shipment is not large. Moreover, in our 
experience, many specialty, gourmet, ethnic, and exotic foods are often 
imported for commercial purposes in very small amounts. Thus, a 
shipment of bottled cooking oil or a beverage contaminated with toxic 
chemicals may be represented as low-value or low-volume but could have 
a wide, and very negative, public health impact. In addition, we note 
that misdeclaration of value of articles of food at entry can be a 
problem. Finally, any burden such an exemption might relieve would 
likely be offset by the burden of administering it.
    (Comments) Comments ask for an exemption for food imported into the 
United States for sale in duty free stores.
    (Response) FDA disagrees. Unless the food is imported and exported 
without leaving the port of arrival until export, as set out in Sec.  
1.277(b)(2), there is no basis in section 801(m) of the FD&C Act for 
such an exemption.
    (Comments) Some comments recommend that prior notice be waived for 
foods in situations that they characterize as ``low risk.'' These 
situations were identified in the comments as any one of the following:

    [sbull] Exported from U.S.-owned foreign companies;
    [sbull] Transferred between commonly owned facilities (intra-
company transfers);
    [sbull] Subject to high quality control standards and/or produced 
in highly-regulated businesses;
    [sbull] Shipped under seal or in bond;
    [sbull] Entered as high-volume, repetitive shipments;
    [sbull] Processed through CBP's Border Release Advanced Selectivity 
Screening (BRASS); and
    [sbull] Associated with a program of assessment of low risk, such 
as the Customs-Trade Partnership Against Terrorism (C-TPAT); Free and 
Secure Trade program (FAST); or food safety and security programs of 
foreign government regulatory authorities.
    (Response) FDA disagrees. As explained previously, section 801(m) 
of the FD&C Act applies to all food imported or offered for import into 
the United States except as outlined in Sec.  1.277(b). Nothing in 
section 801(m) of the FD&C Act authorizes an exemption for articles of 
food that are ``low risk'' or covered by programs of other agencies, 
such as CBP or foreign government regulatory authorities.

[[Page 58994]]

Summary of the Interim Final Rule
    Section 1.277(a) provides that the interim final rule applies to 
food for humans and other animals that is imported or offered for 
import into the United States. This covers food for use, storage, or 
distribution in the United States, including food for gifts, trade and 
quality assurance/quality control samples, food for transshipment 
through the United States to another country, food for future export, 
and food for use in a U.S. FTZ. Section 1.277(b) sets out the 
exclusions from prior notice. It excludes food carried by or otherwise 
accompanying an individual arriving in the United States for that 
individual's personal use (i.e., consumption by the individual or his 
or her family or friends, not for sale or other distribution); food 
that was made by an individual in his or her personal residence and 
sent by that individual as a personal gift (i.e., for nonbusiness 
reasons); food that is imported then exported without leaving the port 
of arrival until export; and meat food products, poultry products, and 
egg products subject to the exclusive jurisdiction of USDA under the 
Federal Meat Inspection Act (21 U.S.C. 601 et seq.), the Poultry 
Products Inspection Act (21 U.S.C. 451 et seq.), or the Egg Products 
Inspection Act (21 U.S.C. 1031 et seq.).

E. ``Who Is Authorized To Submit Prior Notice?'' (Section 1.278 
Proposed as Sec.  1.285)

    The proposed rule (Sec.  1.285) provided that a purchaser or 
importer of an article of food who resides or maintains a place of 
business in the United States or an agent thereof was authorized to 
submit prior notice. FDA noted that a broker/filer would be authorized 
to be a submitter if it was the U.S. agent of the U.S. importer or U.S. 
purchaser.
    FDA further proposed that if the article of food is imported for 
in-bond movement through the United States for export, the prior notice 
must be submitted by the arriving carrier or, if known, the carrier 
making the in-bond entry.
    (Comments) Many comments object to the limitation that only a 
person who resides or maintains a place of business in the United 
States can submit the prior notice. Some comments state that foreign-
based companies that sell food directly to U.S. individuals for their 
own use, including companies that sell via the Internet, cannot expect 
their individual customers to submit prior notice. In addition, 
comments point out that, under some circumstances, the U.S. importer or 
purchaser or carrier would not have all the information required by 
prior notice, but that other entities, e.g., the foreign manufacturer/
processor, shipper, or exporter, would have the required information. 
Many comments state that entities other than U.S. firms or carriers 
should be allowed to submit prior notice.
    (Response) FDA agrees and has removed this restriction on who can 
submit prior notice. Accordingly, Sec.  1.278 of the interim final rule 
provides that any person with knowledge of the required information may 
submit prior notice to FDA. Thus, any person may now take 
responsibility for submitting prior notice for a particular article of 
food, as long as that person can provide all the required information. 
This person is referred to as the submitter in the interim final rule. 
The interim final rule also states that the submitter may use another 
person to transmit the required information to FDA. For ease of 
reference, the person who transmits the prior notice is referred to as 
the transmitter in the interim final rule. If the submitter submits and 
transmits the prior notice, he or she is both the submitter and the 
transmitter. FDA notes that all reply messages sent by the FDA PN 
System Interface will be sent to the transmitter. If prior notice is 
submitted via ABI/ACS, all reply messaging goes to the customs broker 
or self-filer. FDA has also revised the definition of ``you'' 
accordingly.
    (Comments) Comments from customs brokers noted that, although they 
are responsible for timely submission of all documentation required for 
import entry, they are not responsible for verifying the accuracy of 
information provided to them from their customer. Comments ask FDA to 
clarify in the final rule that the customs broker is merely an agent 
for the filing of information obtained from the importer and is not 
responsible for either the adequacy or accuracy of the data submitted. 
Comments assert that the responsibility of the customs broker is to 
accurately submit the information provided by his or her client in 
correct form and in a timely manner.
    (Response) The submitter of prior notice information, regardless of 
the method of or person transmitting the information, is responsible 
for the accuracy of that information. If the transmitter is not the 
submitter, we expect the transmitter, whether he or she is a licensed 
customs broker or other kind of agent, to exercise diligence and care 
to transmit the information provided by the submitter accurately.
    (Interim final rule) Proposed Sec.  1.285 has been changed in the 
interim final rule to Sec.  1.278, ``Who is authorized to submit prior 
notice?'' The interim final rule states that any person with knowledge 
of the required information may submit prior notice. This person is the 
submitter. The submitter may also use another person to transmit the 
required information on his or her behalf. The person who transmits the 
information to FDA is the transmitter. The submitter and the 
transmitter may be the same person. The interim final rule also defines 
``you'' to mean the submitter or transmitter (Sec.  1.276(b)(12)).

F. ``When Must Prior Notice Be Submitted to FDA?'' (Section 1.279 
Proposed as Sec.  1.286)

    FDA proposed that the prior notice must be submitted to FDA no 
later than 12 noon of the calendar day before the day the article of 
food will arrive at the border crossing in the port of entry. As 
described in the proposal, this was based on FDA's assessment of what 
time was needed to meet its statutory mandate of receiving, reviewing, 
and responding to prior notice.
    (Comments) Generally, the comments recommend that FDA adopt a 
shorter, rolling prior notice submission timeframe to reduce the burden 
of the prior notice requirement on the smooth flow of commerce. Many 
comments recommend a specific timeframe for submission of prior notice. 
These recommendations ranged from submission of an annual report for 
repetitive shipments, to submission of the notice at the time of 
distribution of the food after it arrives in the United States.
    Many comments recommend that the prior notice submission timeframe 
be linked to a mode of transportation or type of port of entry, and 
others recommend that it be linked to the type of food. Many comments 
recommend a specific timeframe and associated that timeframe with 
either a mode of transportation/type of port or with a type of food or 
both. Comments recommend that prior notice be submitted 8 hours before 
arrival; some associate the 8 hours timeframe with a water mode of 
arrival only, while others associate the 8 hours timeframe with 
nonperishable foods. Many comments recommend that prior notice be 
submitted 4 hours before arrival; some associating the 4 hours 
timeframe with land and air modes of arrival only and some associating 
the 4 hours timeframe with perishable foods (produce and seafood) and 
live animals only.
    (Response) FDA agrees that the time for submission of prior notice 
should be a rolling timeframe. FDA has determined that the time can be 
shortened to reduce the effect on the

[[Page 58995]]

smooth flow of trade while still providing FDA with sufficient time to 
receive, review, and respond to the information. FDA also agrees that 
timeframes should be different for different modes of transport. As 
such, FDA has revised the rule to require that the timing of submission 
will be no more than 5 days (except in the case of international mail) 
and that the prior notice submission be confirmed by FDA for review no 
less than 2 hours before arriving at the port of arrival by land via 
road, no less than 4 hours before arriving at the port of arrival by 
air and land via rail, and no less than 8 hours before arriving at the 
port of arrival by water.
    When food carried by or otherwise accompanying an individual is 
subject to this rule, the timeframe associated with the manner of the 
individual's arrival applies. If the individual and article of food are 
arriving by land via road, the prior notice must be submitted and 
confirmed at least 2 hours before arrival. If the individual and 
article of food are arriving by air or by land via rail, the prior 
notice must be submitted and confirmed at least 4 hours before arrival. 
If the individual and article of food are arriving by water, the prior 
notice must be submitted and confirmed at least 8 hours before arrival.
    Two major agreements between CBP and FDA allow FDA to reduce 
significantly the time necessary to receive, review, and respond to 
prior notice information. First, FDA and CBP have agreed to commission 
or use CBP staff to perform examinations for FDA when FDA is not 
present at the port of arrival. Since CBP staff generally will be 
available where FDA is not, this means that FDA no longer needs lead-
time to travel significant distances to conduct inspections. In 
addition, CBP agreed to modify ABI/ACS to receive, transmit, and 
communicate prior notice information electronically between CBP and FDA 
for most entries of imported foods by the statutory deadline in the 
Bioterrorism Act of December 12, 2003. CBP's assistance with prior 
notice means that FDA needs far less time to respond to prior notices.
    In considering how to modify the timeframes, FDA concluded that 
setting them by mode of transportation would be the best approach. Mode 
of transportation is clear and easy to apply and administer, so there 
is likely to be little confusion about what timeframes apply. If we 
were to set timeframes based on type of food, e.g., perishable versus 
nonperishable, we would have to develop and implement a system for 
determining which articles of food were which. In addition, different 
articles of food in the same conveyance would be subject to different 
prior notice timeframes, which would subject all items in the 
conveyance to the longest timeframe and add an additional layer of 
complexity that could cause confusion and delays at the border. 
Moreover, many comments recommended mode of transportation, which 
suggests that many stakeholders, including industry, believe such a 
system is workable.
    In determining the actual timeframes for submission of prior notice 
for each mode of transportation, FDA considered the need to provide 
sufficient time for the agency to review and respond to the information 
submitted, as well as the current ability of the food industry to 
provide the information required within the stated timeframe given the 
differences in lead time before arrival among different modes of 
transportation. We determined that information for shipments whose 
transport time is measured in days or weeks (e.g., ocean shipments) is 
available further in advance of arrival than shipments whose transport 
time is measured in hours (e.g., land and air shipments.) Staggered 
prior notice submission timeframes will allow FDA reviewers to direct 
additional resources to shipments with short transport times and to 
defer review of shipments with longer transport times. Based on these 
considerations, FDA established the prior notice timeframes in the 
interim final rule to associate with the mode of transportation.
    FDA is committed to exploring ways to increase integration and 
reduce the prior notice timeframes further. Accordingly, FDA and CBP 
will continue working together to determine what is needed to achieve 
this goal. No later than March 12, 2004, the Commissioners of FDA and 
CBP will publish a plan, which will include an implementation schedule, 
to achieve the goal of a uniform, integrated system and to coordinate 
timeframes for import prior notice information while fulfilling the 
Bioterrorism Act mandates for air and truck modes of transportation 
with timeframes finalized by CBP when they finalize the rule entitled 
``Required Advance Electronic Presentation of Cargo Information,'' 
published in the Federal Register on July 23, 2003 (68 FR 43574).
    For imported food arriving via international mail, the interim 
final rule requires that prior notice be submitted before the food has 
been sent. This timeframe allows the FDA PN Confirmation Number to 
accompany the package, which is necessary to establish that prior 
notice has been submitted and to match the prior notice submission to 
the package upon arrival.
    (Comments) Some comments recommend that the prior notice submission 
timeframe be waived for foods exported from U.S.-owned foreign 
companies. Other comments recommend that a different timeframe be 
established for foods associated with a program of assessment of low 
risk, such as the C-TPAT.
    (Response) The interim final rule does not provide for a waiver of 
the timeframe for foods imported by U.S.-owned firms. Nor does the rule 
provide for a different timeframe for foods or firms covered by 
programs of other agencies, such as C-TPAT. The interim final rule 
provides for greatly reduced timeframes for foods based on mode of 
transportation. These timeframes are what FDA has determined are the 
minimum timeframes necessary to allow it to satisfy the statutory 
mandate that the timeframes give the agency the time it needs to 
``receive, review, and respond'' to prior notices. However, FDA is also 
interested in exploring flexible alternatives for submission of prior 
notice for foods or firms covered by programs of other agencies, such 
as C-TPAT, or imported by other agencies.
    (Interim final rule) Section 1.279(a) in the interim final rule has 
been revised to require submission of the prior notice to FDA and the 
submission must be confirmed by FDA for review no less than 2 hours 
before arriving at the port of arrival by land via road, no less than 4 
hours before arriving at the port of arrival by air and land via rail, 
and no less than 8 hours before arriving at the port of arrival by 
water. Under Sec.  1.279(b), prior notice may not be submitted more 
than 5 calendar days before arrival, except in the case of food 
imported or offered for import by international mail.
    Under Sec.  1.279(c), if the article of food is arriving by 
international mail, the prior notice must be submitted before the food 
is sent to the United States.
    Section 1.279(d) provides that the time of submission is fixed and 
the prior notice time will start for purposes of determining if prior 
notice is timely when the prior notice submission is confirmed by FDA 
for review. FDA will confirm a prior notice once all required 
information has been submitted and confirmed as facially complete. For 
example, if the information submitted were to include a registration 
number, name, city, and country for the manufacture of an article of 
food, and the system review were to reveal that the registration number 
does not exist or does not match the name, city, and country of the 
facility, the FDA PN

[[Page 58996]]

System Interface will not provide a confirmation for that prior notice. 
The transmitter will have an opportunity to correct the rejected 
information. When the information is corrected, transmitted, and 
determined to be facially valid, the system will then notify the 
transmitter and provide the PN Confirmation Number. As set out in Sec.  
1.279(d), FDA will notify the transmitter that the prior notice has 
been confirmed for review with a confirmation that contains a PN 
Confirmation Number. The prior notice will be considered submitted and 
the prior notice time will start when FDA has confirmed the prior 
notice for review.
    Under Sec.  1.279(e), the PN Confirmation Number must accompany any 
article of food arriving by international mail. Under Sec.  1.279(f), a 
copy of the confirmation (with the PN Confirmation Number) must 
accompany any article of food carried by or otherwise accompanying an 
individual (unless excluded under Sec.  1.277(b)(1)), and be provided 
to CBP or FDA upon arrival.
    Additionally, under Sec.  1.279(g) the PN Confirmation Number must 
accompany any article of food for which the prior notice was submitted 
through the FDA PN System Interface when arriving in the United States 
and must be provided to CBP and FDA upon arrival.

G. ``How Must You Submit Prior Notice?'' (Sec.  1.280 Proposed as Sec.  
1.287)

    FDA proposed that prior notice and any amendments and updates must 
be submitted electronically to FDA through a new Web interface. The 
proposed rule also required submission of hard-copy prior notice, in 
person or by e-mail or fax, if the FDA system was not operating. Before 
issuing the proposed rule, FDA consulted with CBP, which was then the 
U.S. Customs Service of the Department of the Treasury, about the 
proposed rule and the feasibility of modifying ABI/ACS to accommodate 
the new prior notice requirement. During these consultations, CBP 
advised that ABI/ACS could not be modified to accommodate the data 
requirements of the prior notice regulation by the December 12, 2003, 
statutory deadline.
    (Comments) Many comments focus on the proposed method of submission 
of prior notice. These comments fall into four broad categories. The 
first category, which includes the largest number of comments, suggests 
that FDA work more closely with other agencies, and in some cases other 
countries, to eliminate redundancies or conflicts in the method of 
submission. The majority of these comments urge the FDA to work more 
closely with CBP. A second group of comments addresses the viability of 
the proposed Web-based system for submission of prior notice. The third 
category includes suggestions about the prior notice form that was 
included in the proposed rule. The final category of comments asserts 
that existing systems and procedures provide adequate defense against a 
bioterrorism threat and that the proposed regulation is unnecessary.
1a. Work With Other Agencies To Eliminate Redundancies
    (Comments) Most comments recommend that FDA and CBP work together 
to reduce the adverse impact of submission of information in both prior 
notice and CBP entries. Most of these comments suggest that the 
existing ACS-OASIS interface between CBP and FDA be used to accept 
prior notice information. Other comments suggest that much of the 
information required for prior notice was available in CBP's Automated 
Manifest System (AMS). Although many comments suggest that the existing 
systems contained sufficient information to meet the statutory 
requirements, others recognize that modifications were needed to meet 
the Bioterrorism Act's requirements.
    (Response) FDA and CBP agree with many of the comments made about 
inter-agency cooperation as well as with the recommendation that we 
provide a single point of data entry for CBP and FDA for as many kinds 
of entries as possible. FDA and CBP are committed to the joint 
implementation of an automated approach to prior notice that will meet 
the following objectives: (1) Reduce submission of redundant data to 
the extent possible; (2) build on current operational procedures; and 
(3) implement the law with minimal disruption to current entry 
practices.
    The interim final rule requires prior notice to be submitted 
electronically to FDA through CBP's ABI/ACS or the FDA PN System 
Interface. Prior notice may be submitted through ABI/ACS for all food 
imports subject to this interim final rule except food imported by 
international mail or other transactions that cannot be submitted 
through ABI/ACS and food that has been refused under section 801(m) of 
the FD&C Act. The proposed rule was based on an initial review by both 
FDA and CBP of the feasibility of implementing new operational 
procedures and enhancing existing systems. After further review of the 
potential technical, legal, and operational impacts, FDA and CBP have 
determined that the prior notice information required for most types of 
CBP entries of foods can be submitted through the existing ABI/ACS and 
provided to FDA. The existing ABI/ACS-OASIS interface allows for 
communication both between FDA and the customs broker or self-filer 
(necessary for the submission of prior notice to FDA as required by 
section 801(m)(1) of the FD&C Act), and between FDA and CBP (necessary 
for followup at the border). However, although much of the information 
required for prior notice currently existed in some automated form in 
ABI/ACS, not all the necessary data were available in the right 
sequence or at the right time to meet prior notice requirements. Thus, 
FDA and CBP have been working closely together and enhancing, ABI, ACS, 
and OASIS to craft operational procedures and systems that meet the 
requirements of the Bioterrorism Act with minimal impact on existing 
processes.
    Since prior notice is required for some of imported food for which 
electronic transmission of information to CBP is not available via ABI/
ACS and since submission of information through ABI/ACS is not 
mandatory, an alternative means to submit prior notice will still be 
needed. Although a CBP entry is not normally submitted in ABI/ACS for 
T&E entries and IT entries and FTZ admissions, a new transaction 
format, similar to the existing ABI transactions, will be available for 
submitting prior notice for these imports through ABI/ACS. The FDA PN 
System Interface will also be available for international mail, food 
refused under section 801(m) of the FD&C Act, and those who choose not 
to submit prior notice through ABI/ACS.
1b. CBP AMS
    (Comments) Several comments note that some of the information FDA 
required for prior notice was already being submitted to AMS and 
suggested that FDA could retrieve data from AMS rather than ask for a 
separate submission for prior notice.
    (Response) AMS is a module of ACS through which carriers, port 
authorities, or service bureaus transmit electronically the cargo 
declaration portion of the inward foreign manifest to CBP. The 
information submitted to AMS is not sufficient to satisfy section 
801(m)(1) of the FD&C Act's requirements. For example, the identities 
of the manufacturer, grower, FDA product code, and quantity of each 
article are not submitted to AMS. FDA and CBP have consulted about 
interfacing with AMS for manifest data and determined that the general 
cargo data in AMS were simply not suitable to accommodate the detailed 
information requirements of section 801(m) of the FD&C Act. In 
addition, no

[[Page 58997]]

interface currently exists between AMS and the existing interface with 
OASIS through the ABI/ACS entry processes, which means FDA does not 
have any access to AMS data. However, section 801(m) of the FD&C Act 
requires that prior notice be submitted to FDA. Given the 
implementation date of December 12, 2003, CBP and FDA concluded that it 
was not practical to attempt to modify AMS to accommodate the new prior 
notice requirements when we could enhance the existing ABI/ACS-OASIS 
interface.
2a. Viability of a Web-Based System
    (Comments) A common concern expressed by commenters is the 
viability of the FDA PN System Interface for the volume of data traffic 
and the time-sensitive nature of prior notice information. Multiple 
comments address system availability, the time needed to enter and 
process the data, and the need for confirmation.
    (Response) FDA agrees that implementation of a new FDA PN System 
Interface as the primary means of data submission for 25,000 plus 
transactions a day would be challenging, particularly considering the 
effect on the food industry if the system were not responsive. That 
concern has been substantially addressed as a result of the commitment 
by CBP and FDA to work together to enhance the existing ABI/ACS-OASIS 
interface to accommodate the prior notice requirements. The decision 
includes the development of a new ABI/ACS ``transaction type'' that 
will accommodate prior notices for IT entries, T&E entries, and food 
shipped directly to an FTZ. This new feature further reduces the number 
and type of transactions that must be submitted through the FDA PN 
System Interface.
    FDA anticipates that less than 10 percent of the total submissions 
will be submitted through the FDA PN System Interface. The FDA PN 
System Interface will be available 24 hours a day, 7 days a week. FDA 
has taken steps to ensure that the FDA PN System Interface can provide 
adequate response times to support data entry and return of 
confirmation by reply messaging.
2b. Contingency System
    (Comments) FDA received several comments on the need for a 
contingency plan or backup plan in case of FDA Web system failure. The 
severity of the consequences if FDA were to fail to receive a prior 
notice, and the common experience with Web system failures, was of 
great concern to many of the system's potential users. Many suggestions 
were made for contingency plans, e.g., information on what FDA plans to 
do if the automated system is unavailable.
    (Response) FDA agrees that plans for contingencies are needed, even 
with the reduced volume of traffic on the FDA PN System Interface and 
the existence of two modes of submission. FDA does not plan to exempt 
any specific categories of food articles from prior notice if systems 
are not performing; FDA and CBP are working together to develop 
contingency plans for when the system(s) are not working. The interim 
final rule, Sec.  1.279(b) through (d), sets out how we will handle 
prior notice in four ``down-time'' situations: The customs broker's or 
self-filer's access to ABI/ACS is not working; the ABI/ACS interface is 
not working; the FDA PN System Interface is not working; and OASIS is 
not working. In all these situations, an alternative form of prior 
notice information is required. If access to ABI/ACS is not available, 
prior notice must be submitted via the FDA PN System Interface. If FDA 
determines that FDA PN System Interface is not working, prior notice 
must be submitted manually by those who do not use ABI/ACS. If FDA 
determines that OASIS is not working, all prior notices must be 
submitted manually. FDA will issue notification through notices on the 
FDA Web site at http://www.fda.gov, at http://www.access.fda.gov, and 
through messages in ABI/ACS. Once FDA issues this notification, prior 
notice information must be submitted to FDA by e-mail or by fax.
    Manual submissions must be submitted by e-mail or fax. Because all 
review is being done in a centralized location, we will not accept 
manual submissions in person. The FDA Web site at http://www.fda.gov 
will have a list of the information required for prior notice 
submission and the fax number(s) and e-mail address(es) where prior 
notice can be sent. The list of the information required can be 
printed. It can also be downloaded to the submitter's or transmitter's 
word processing system and used as a basis for submitting prior notice 
information to FDA. Because the FDA PN System Interface at http://www.access.fda.gov and FDA's Web site at http://www.fda.gov are located 
on independent platforms, this information will be available even when 
the FDA PN System Interface is not working. This fax number and the e-
mail address will not be activated to accept prior notice information 
unless FDA determines that the FDA PN System Interface or OASIS is not 
working. Additional information about the down-time, i.e., confirmation 
that the FDA PN System Interface or OASIS is down and estimated down-
time will be posted at http://www.fda.gov--see ``prior notice'' and 
will be available from the help desk.
2c. Alternate Methods
    (Comments) Several comments suggest more than one path for 
submission of prior notice information. Some comments ask that FDA 
allow for manual submission, either as a backup, or as an alternate 
path. Others suggest that some types of ``safe'' products be allowed to 
bypass prior notice if the system were not performing. Still others 
suggest that the potential for catastrophic system failure requires FDA 
to implement 2 interfaces for prior notice data, often implying that 
ACS was an appropriate alternative system.
    (Response) FDA does not agree that a process for manual 
transmission is needed, except on a contingency basis. FDA believes 
that, in 2003, persons engaged in international commerce have, or can 
get, access to the Internet. If the Internet is not accessible by the 
submitter, he or she can use a customs broker to submit prior notice 
through ABI/ACS or another person to transmit prior notice through the 
FDA PN System Interface. As the primary mode of submission, manual 
transmission would not give adequate time for FDA personnel to receive, 
review, and respond, unless the timeframes for prior notice in the 
interim final rule were greatly extended. Thus, manual transmission 
will be used only as a contingency alternative. FDA also notes that the 
data quality of manual systems is usually less than satisfactory, 
because no automated data validation takes place during data entry. The 
U.S. Government has a strong commitment to reducing paper-based 
processes and moving toward e-commerce for all business transactions. 
Accordingly, under the interim final rule, paper-based submissions will 
not be allowed, except as set forth in Sec.  1.280(c) and (d), by e-
mail and fax. However, FDA and CBP do not expect system failures to be 
a common occurrence.
2d. Security of System
    (Comments) Several comments question the security of the system and 
suggested that the system must have extraordinarily stringent security 
protocols in place to protect sensitive commercial information and 
prevent potential terrorists from obtaining information capable of 
providing cover.
    (Response) FDA agrees the information must be secure. Any 
fraudulent or inadvertent changes in data could affect FDA response and 
thus affect the health and welfare of

[[Page 58998]]

consumers in the United States. FDA has determined that the data 
security and data integrity requirements of the prior notice data are 
on par with entry data currently submitted through ABI/ACS to OASIS. 
Prior notice data submitted through ABI/ACS will have the same security 
and access controls as entry data currently received through ABI/ACS. 
Adequate and effective security controls will be placed on the FDA PN 
System Interface through user account management and authentication 
processes, and password controls, to ensure data security and 
integrity.
    A number of statutes, regulations, and policies address protection 
of sensitive information from unauthorized disclosure. Some that are 
relevant to prior notice include the Clinger-Cohen Act of 1996, the 
Computer Security Act of 1987, the Trade Secrets Act, 21 CFR 20.61 
(Trade Secrets and Commercial or Financial Information Which Is 
Privileged or Confidential), OMB Circular A-130 (Management of Federal 
Information Resources), and FDA Staff Manual Guide 3250.15 (Information 
Technology Security, Data Security--Data Confidentiality). For example, 
Appendix III to OMB Circular No. A-130 establishes a minimum set of 
controls to be included in an agency's information security program and 
requires security controls to be commensurate with the risk and 
magnitude of the harm resulting from the loss, misuse, or unauthorized 
access to or modification of information.
3a. Prior Notice Form
    (Comments) Several comments suggest changes to the proposed form. 
Most of these recommend changes in the order of items in the form.
    (Response) The draft form that was provided as an attachment to the 
proposed rule was intended only to provide a graphic summary of the 
information to be collected by the FDA PN System Interface (68 FR 
5334). The form was an illustration, intended to help potential users 
to visualize the data requirements and to better analyze their 
relationship and impact. FDA did not intend the draft form to be a 
sample of the screens that will be available to the user on the 
proposed FDA PN System Interface. Nor was it intended to be a draft 
paper form, since paper-based submission will not be acceptable, except 
as a contingency if the system is not operating.
    The actual screens of the FDA PN System Interface are based on 
standard Web design principles, with primary attention to support of 
anticipated data entry. The screens will incorporate extensive use of 
``pull-down'' lists to assist users in entering their data. For 
example, transmitters will use a predefined pull-down list of 
International Standards Organization (ISO) codes for countries to enter 
the country from which the article is shipped. Screen design places 
critical data entry items at the beginning of the submission process 
and uses those items to drive later processes. Data entry processing 
will also include robust and user-friendly data validation to ensure 
that transmitters enter data correctly and do not fail prior notice 
because of inadvertent errors in their data entry screens. Additional 
description of the FDA PN System Interface is included in the 
discussion of the interim final rule at the end of this section.
3b. Form Processing
    (Comments) Several comments make suggestions about the way the form 
should be processed, requesting self-populating fields, the ability to 
change information without redoing the whole form, confirmation after 
submission, and other features that would make submission easier.
    (Response) As noted previously, FDA did not intend the draft form 
in the proposed regulation to suggest processing sequences. Submitters 
or transmitters using the ABI/ACS interface to submit prior notice data 
to the FDA will be able to make full use of the capabilities of their 
particular ABI software's automation features. The FDA PN System 
Interface will permit initial partial data entry and will allow the 
user to save the information entered until all data are available for 
submission. The FDA PN System Interface is designed to accept 
``header'' information that will permit repeated information to be 
automatically entered. This ``header'' would contain information 
consistent across several articles of food within the same submission, 
e.g., date and time of arrival for several articles of food in one 
shipment. This will reduce the amount of data entry and potentially 
reduce typing and transcription errors. FDA has developed the FDA PN 
System Interface to allow submitters to automatically repeat 
information already entered in the submission where appropriate (e.g., 
all information is the same except for the identity of the article or 
the manufacturer).
    The order of information required in prior notice is displayed to 
best support user input. For example, the first information required is 
the identification of the submitter and transmitter, if applicable. The 
next information is the common information that may apply to all 
articles of food for which prior notice is being submitted at the same 
time, such as the manufacturer, shipper, carrier, etc. For example, 
when a manufacturer is identified for the first article of food, the 
submitter will be able to indicate, using a check box, that the 
manufacturer is the same for all articles of food in the shipment.
3c. Clarification of Fields
    (Comments) A few comments ask for clarification on the meaning of 
specific fields.
    (Response) Elsewhere in this rule FDA sets out the information that 
must be submitted in a prior notice (see Sec.  1.281). In addition, 
online help will be available, which will include descriptive 
information on data fields, and their relationship to other required 
information and references to the requirements. FDA will also provide a 
help desk with staff who will answer questions that are not 
specifically answered by the online help. Information on how to contact 
the help desk will be available on both the FDA PN System Interface at 
http://www.access.fda.gov and the FDA Web site at http://www.fda.gov--
see ``prior notice.''
4. Existing System Adequate
    (Comments) Several comments suggest that the regulations proposed 
were unnecessary and that FDA already had the data required, so prior 
notice would not provide any additional security. These comments 
conclude that the proposed regulation is therefore functionally 
redundant.
    (Response) Congress mandated prior notice when it enacted the 
Bioterrorism Act. FDA disagrees with the assertion that prior notice 
will not provide any additional security because similar information 
about food is already available. Current systems do not provide all of 
the information required by the Bioterrorism Act. Nor do they ensure 
that FDA is provided with the required information before arrival, as 
required by Congress when it passed the Bioterrorism Act.
5-11. Description of the Prior Notice Submission Systems
    Prior notice submission and electronic review will be accomplished 
through several new or enhanced components of FDA's and CBP's existing 
electronic systems.
    a. ABI/ACS interface. The existing ABI/ACS interface, which sends 
data from customs brokers or self-filers through ACS to OASIS, will be 
enhanced to support the prior notice requirement. For customs brokers 
or

[[Page 58999]]

self-filers providing prior notice as part of their CBP entry through 
the ABI/ACS interface, the process for submission and response will be 
similar to the current process for submitting entry information about 
FDA-regulated products. A customs broker or self-filer will enter and 
transmit the information currently required in a CBP entry, along with 
any additional information required in prior notice, using the software 
that currently supports submission of data through the ABI interface. 
(Changes will be required to the existing software to support the 
additional information required in the prior notice.) As it does 
currently, ACS will validate the submission to ensure that data 
required by CBP and FDA is entered. The existing validation will be 
enhanced to include validation of some prior notice information. If 
errors or deficiencies are found, the transmission will be rejected and 
the customs broker or self-filer can resubmit after correcting the 
errors or deficiencies.
    Once ACS determines a submission is valid, the prior notice 
information and other data will be transmitted to OASIS. OASIS will 
perform additional data checks and validations. Validation is the 
process by which the data are checked for completeness and self-
consistency by the system. It is a rapid process that does not include 
screening the data for potential public health concerns. That screening 
occurs after data validation. If the submission is determined to be 
facially valid, FDA will transmit a message through ACS to the customs 
broker or self-filer. The message will provide the Prior Notice 
Confirmation Number (PN Confirmation Number), which verifies that the 
prior notice has been confirmed by FDA for review.
    If errors are found, OASIS will reject the submission and generate 
a message(s) identifying where the error occurs. No PN confirmation 
number will be issued. After the customs broker or self-filer is 
notified of the errors, the customs broker or self-filer can correct 
the errors and resubmit the entire entry using the same entry number 
through the existing CP transaction process (which is the existing 
transaction for brokers or self-filers to resubmit FDA-specific data 
through ACS). This process only allows FDA-specific data to be 
corrected for resubmission, and not CBP-specific data.
    A new ABI/ACS-OASIS interface, modeled after the existing process, 
will be available to submit prior notice for an article of food 
entering the United States as an IT or T&E entry, or an FTZ admission. 
This new transaction will not require all of the information currently 
submitted to CBP at the time a consumption entry is filed, but will 
require complete prior notice information. Processing of these prior 
notices will be similar to that described for consumption entries. 
However, prior notice will be submitted by a new transaction type that 
will require only the information needed for prior notice and to 
support messages to CBP regarding the adequacy of the prior notice.
    If CBP entry is later filed, the PN Confirmation Number for the 
article must be entered as an affirmation of compliance for OASIS 
purposes as evidence that prior notice for the product was submitted 
and confirmed before arrival. Depending on the capabilities of a 
customs broker's or self-filer's software, a copy of the ABI Cargo 
Release Summary will also show that the prior notice has been received, 
though not necessarily confirmed, by FDA.
    The following list identifies the types of entries, with 
accompanying CBP description, for which prior notice may be submitted 
through ABI/ACS at the submitter's option:
    ``Consumption entries''--products entered for use or consumption in 
the United States;
    ``Warehouse entries''--products subject to duty but for which 
payment of duties is deferred. Merchandise entered into a warehouse may 
be stored, repacked, cleaned, manufactured, smelted, refined, or sold 
for export. Food must remain in the warehouse until withdrawn for 
consumption in the United States (and any applicable duty paid);
    ``IT entries''--in-bond transportation entries for merchandise that 
arrives at a Customs port of entry but is transported without 
appraisement to another Customs port of entry where it may be entered 
for consumption or warehouse, admitted into a FTZ or may be the subject 
of another transportation entry;
    ``T&E'' entries''--in-bond transportation entries for merchandise 
which arrives at a Customs port of entry and is to be transported 
without appraisement through the Customs territory and then exported; 
and
    ``FTZ admissions''--are for merchandise to be used in manufacturing 
or exhibition or to be manipulated in a FTZ. Merchandise admitted into 
the zone is not subject to the payment of duties. Merchandise may be 
withdrawn from the zone for consumption, warehousing, or exportation. 
There are various categories of merchandise in a zone.
    b. FDA PN System Interface. The new FDA PN System Interface will be 
available for international mail and other transactions that are not 
accepted by ABI/ACS, food refused under section 801(m) of the FD&C Act, 
and those who choose not to submit prior notice through ABI/ACS. The 
FDA PN System Interface is available at http://www.access.fda.gov. FDA 
expects that less than 10 percent of transactions will be routinely 
submitted through the FDA PN System Interface. We estimated the number 
of informal entries that are not currently captured by ABI/ACS and 
international mail submissions based on discussions with CBP.
    The FDA PN System Interface will allow the user to view and print a 
prior notice confirmation, including a PN Confirmation Number, the time 
the prior notice was confirmed, and a record of the information 
received and validated by FDA.
    To submit prior notice information electronically by the FDA PN 
System Interface, the transmitter must establish a prior notice 
account. FDA's Unified Registration and Listing System (FURLS) at 
http://www.access.fda.gov will manage the issuance of user accounts for 
both food facility registrations and prior notice submissions. FURLS 
will be available 24 hours a day, 7 days a week, and will provide end-
users access to the systems. After successfully logging in using the 
account password, FURLS will pass the user account credentials to the 
FDA PN System Interface. If the transmitter has not established a prior 
notice account, the transmitter will be directed to establish a prior 
notice account the first time he or she accesses the FDA PN System 
Interface. Subaccounts can also be created, at the discretion of the 
primary account, to allow more than one person associated with a prior 
notice to access the prior notice information.
    A submitter or transmitter who elects to use the FDA PN System 
Interface will enter information online, using a series of screens 
designed to lead the submitter through the prior notice submission 
process. Data will be subject to the same validation criteria used in 
the ABI/ACS-OASIS interface, but the validation will be performed on-
line, in real time. When the prior notice submission has been 
validated, the transmitter will receive a message showing that the 
prior notice has been received by FDA for review and accepted as 
facially complete. This message will include a unique PN Confirmation 
Number as well as the date and time of the submission and confirmation. 
The message will confirm that the prior notice is facially complete and 
has been received by the FDA for review. Capability will also be 
provided

[[Page 59000]]

to get a hard copy printout of the prior notice submission and a 
confirmation for verification upon arrival of the article of food, if 
needed.
    If the prior notice was submitted through the FDA PN System 
Interface, this confirmation number must accompany the article of food 
when it arrives at the port of arrival. For food arriving by 
international mail, the PN Confirmation Number received from the FDA PN 
System Interface must be entered on the ``Customs Declaration--CN22 and 
CN23'' supplied when the article is mailed. When food subject to this 
subpart is carried by or otherwise accompanies an individual, the 
individual must have the PN Confirmation Number, as well. The number 
will provide CBP and FDA personnel at the border with the means to 
connect to the results of the FDA review of the prior notice 
information.
    Receipt of a PN Confirmation Number is evidence only that a prior 
notice has been received for FDA review. Should the FDA review process 
determine that an article of food should be inspected, personnel at the 
border will examine the food.
    Prior Notice covering a refused food (no prior notice or inaccurate 
prior notice) must be submitted through the FDA PN System Interface. In 
addition to prior notice information, the FDA PN System Interface will 
be used to inform FDA of the port or secure storage location where 
refused food is or will be held.
12. FDA Review
    The FDA prior notice review process will operate 7 days a week, 24 
hours a day to review prior notice submissions transmitted through both 
ABI/ACS and the FDA PN System Interface. This process begins with an 
automated screening process. If additional evaluation of the prior 
notice information is necessary, FDA headquarters staff, operating 24 
hours a day, 7 days a week, will review the information and may 
initiate an examination by FDA or CBP of the article of food at the 
port of arrival, or in the case of rail shipments, within the confines 
of the closest appropriate examination site. The review process is and 
manual review by FDA staff. It will be designed to identify food 
products that may pose serious risks to public health so that 
appropriate action can be taken upon arrival in the United States. The 
review process is not impacted by the method of electronic submission. 
The results of this process will be transmitted to CBP.
    The existing OASIS screening and FDA staff review and examination 
processes will determine admissibility under section 801(a) of the FD&C 
Act. Thus, food that has not been refused after review and/or 
examination of the prior notice information may be subject to further 
inspection and sampling at an inland destination for determination of 
admissibility under section 801(a) of the FD&C Act.
13. Summary of the Interim Final Rule
    The interim final rule requires that prior notice be submitted 
electronically to FDA. All prior notice information must be submitted 
in the English language except an individual's name, the name of a 
company, and the name of a street may be submitted in a foreign 
language. All information, including these items, must be submitted 
using the Latin (Roman) alphabet. The prior notice may be submitted 
through ABI/ACS or the FDA PN System Interface at http://www.access.fda.gov. Prior notice must be submitted via the FDA PN 
System Interface for articles of food imported or offered for import by 
international mail or other transaction types that cannot be made 
through ABI/ACS and articles food that have been refused under section 
801(m)(1) of the FD&C Act.
    The interim final rule, in Sec.  1.279(b) through (d), also sets 
out how we will handle prior notice in four ``down-time'' situations: 
The customs broker's or self-filer's access to ABI/ACS is not working; 
the ABI/ACS interface is not working; the FDA PN System Interface is 
not working; and OASIS is not working. In all these situations, an 
alternative form of prior notice information is required. If access to 
ABI/ACS is not available or if the ABI/ACS interface is not working, 
prior notice must be submitted via the FDA PN System Interface. If FDA 
determines that FDA PN System Interface is not working, prior notice 
may be submitted manually by those who do not use ABI/ACS. If FDA 
determines that OASIS is not working, all prior notices must be 
submitted manually. FDA will issue notification through notices on the 
FDA Web site at http://www.fda.gov, at http://www.access.fda.gov and 
through messages in ABI/ACS. Once FDA issues this notification, prior 
notice information must be submitted to FDA by e-mail or by fax. Hand 
delivery of hard copy to FDA is not allowed. The location for receipt 
of submission by e-mail or fax is listed at http://www.fda.gov--see 
``prior notice.''

H. ``What Information Must Be in a Prior Notice?'' (Sec.  1.281 
Proposed as Sec.  1.288)

    Proposed Sec.  1.288 listed the information that was to be included 
in each prior notice. Part of the information was taken directly from 
section 801(m)(1) of the FD&C Act. The remainder of the list consisted 
of information that FDA and CBP have determined is necessary to ensure 
that we can enforce section 801(m) of the FD&C Act's prior notice 
requirements as intended by Congress. This additional information is 
thus authorized under section 701(b) of the FD&C Act (21 U.S.C. 
371(b)). In the proposed rule, we explained why each of these items was 
necessary for the efficient enforcement of section 801(m) of the FD&C 
Act.
    (Comments) Generally, comments assert that the proposed rule 
required too many data elements. Some comments state that the required 
information is more than that necessary to facilitate inspection; is 
burdensome on industry; and is more information than that authorized by 
the Bioterrorism Act, particularly with regard to product identity, 
port of entry, and identification of parties involved in prior notice. 
One comment argues that the prior notice was intended by Congress only 
to aid FDA in its efforts to ensure the security of the food supply, 
not to enhance compliance of imported food with all applicable FD&C Act 
requirements.
    (Response) FDA agrees with many of these comments. Accordingly, the 
interim final rule will not require submission of the following 
information:
    [sbull] Telephone and fax numbers and e-mail addresses for most 
firms;
    [sbull] Registration numbers, except for the manufacturer and 
shipper, if otherwise required by section 801(l) of the FD&C Act;
    [sbull] Entry line numbers;
    [sbull] Brand or trade name;
    [sbull] CBP port of entry;
    [sbull] Anticipated date of entry for CBP purposes; and
    [sbull] The identities of multiple carriers.
    FDA has also revised the following information requirements to make 
them less burdensome:
    [sbull] Quantity;
    [sbull] Lot/code identifier;
    [sbull] Manufacturer; and
    [sbull] Grower.
    Finally, FDA has added the following information requirements due 
to the changes in timeframe, the need to coordinate with CBP, and in 
response to comments:
    [sbull] The mode of transportation; and
    [sbull] Planned shipping information, including the 6-digit HTS 
code.
    FDA does not agree that section 801(m) of the FD&C Act is limited 
to ``food security.'' The purpose of the Bioterrorism Act is ``[t]o 
improve the ability of the United States to prevent,

[[Page 59001]]

prepare for, and respond to bioterrorism and other public health 
emergencies.'' (Pub. L. 107-188 (emphasis added)). Title III of the 
Bioterrorism Act is titled, ``Protecting the Safety and Security of the 
Food and Drug Supply.'' (Pub. L. 107-188 (emphasis added)). Indeed, 
when reviewing prior notices that have been submitted after a food has 
already been refused for lack of adequate prior notice, Congress 
explicitly directs FDA to determine if it has in its possession any 
``credible evidence or information indicating that such article present 
a threat of serious adverse health consequences or death to humans or 
animal,'' (section 801(m)(2)(B)(ii) of the FD&C Act). This standard is 
a health-based standard and is not limited to intentional acts of 
contamination.
    For clarity, the interim final rule also has segregated the 
information requirements for food imported or offered for import by 
international mail as new Sec.  1.281(b) and the information 
requirements for food refused under section 801(m) of the FD&C Act as 
new Sec.  1.281(c).
1. Registration Numbers
    (Comments) Comments note that the submitter may not know the 
necessary registration numbers and recommend that FDA confirm the 
registration numbers within its system. A comment reasons that, because 
FDA will have access to the contact information in its facility 
registration database, FDA should only require the registration number 
rather than the name, address, telephone number, fax number, and e-mail 
address to reduce the burden on submitters. Another comment states that 
it would be impossible to provide the FDA registration numbers of all 
operators that have handled the imported food and questions FDA's need 
for the registration numbers because the ``one up, one down'' 
recordkeeping provision added to the FD&C Act by section 306 of the 
Bioterrorism Act is sufficient to help FDA take appropriate steps. 
Other comments express concern about the confidentiality of 
registration numbers, i.e., they may be denied access to the 
registration number or be unable to verify it. Other comments state 
that an importer who imports returned U.S. goods has no direct 
relationship with the U.S. manufacturer and therefore assert that these 
importers cannot obtain the registration number.
    (Response) Registration of facilities that manufacture/process, 
pack, or hold food for consumption in the United States is required by 
new section 415 of the FD&C Act, which was added by section 305 of the 
Bioterrorism Act. FDA does not believe that the statute gives FDA 
authority to waive the registration requirement for facilities that 
manufacture/process, pack or hold food for consumption in the United 
States. The one instance when not providing a registration number may 
be appropriate is when the manufacturer is out of business or 
registration no longer is appropriate because the manufacturer has 
ceased making food products under FDA's jurisdiction.
    If such a food is refused because of inadequate prior notice for 
failure to provide a registration number, or if the food is held under 
Sec.  1.285(b), you may request an FDA review under Sec.  1.285(j). As 
part of your request, you should provide FDA information to show that 
the facility associated with the food is out of business or inactive.
    Registration is designed to work in concert with prior notice at 
the border, as reflected in new section 801(l) of the FD&C Act, which 
provides that food from facilities that must register may not be 
admitted into distribution for consumption in the United States unless 
the relevant facilities have been registered. To enforce section 801(l) 
of the FD&C Act as intended by Congress, FDA has determined that it 
must review registration status of manufacturers and shippers as part 
of prior notice. The information provided by registration will allow 
FDA to check prior notice submissions against registration data to 
confirm the identity. Moreover, the information provided by prior 
notice submissions can serve as a crosscheck as to whether these firms 
are registered as required and have provided the necessary updates. FDA 
thus believes that prior notice and registration will work in tandem to 
provide FDA with information about the article of food and a facility 
involved in its production and distribution that will inform and 
improve our risk-based border inspection decisions, as well as our 
later admissibility determinations.
    FDA does not agree that it should confirm registration without 
requiring that the number be submitted. Each registered facility will 
be assigned a unique registration number by FDA. Thus, the registration 
number will help identify the manufacturer. Without a registration 
number, it may be difficult to determine exactly which registered 
facility to associate with the article: Different firms may have the 
same or similar names and more than one firm may operate from a 
particular location. In addition, requiring the registration number as 
part of manufacturer identity makes it clear to foreign exporters and 
U.S. importers from the outset when registration is required for 
imported food.
    FDA does not agree that the registration number, when one is 
required, is sufficient by itself to ``identify'' a person in a prior 
notice submission. The additional information is needed to verify that 
the registration number is accurate. For example, without additional 
information, there is a significant possibility of typographical 
errors, leading to misidentification of facilities, which could lead to 
foods being stopped at the border for inadequate prior notice and 
registration. FDA is requiring identifying information in addition to 
the registration number (if one is required) to reduce the number of 
clerical or typographical errors in registration information that could 
result in refusals. The FDA PN System Interface will require the firm 
name and at least the city and country as ``confirmatory information,'' 
in addition to the registration number to allow for validation. (If 
registration is not required for the facilities associated with a 
particular article of food, a registration number may still be 
provided, along with the name of the facility and the city and country. 
If a registration number is not required and the submitter chooses not 
to provide the number voluntarily, the name and full address of the 
facility must be provided to ensure that FDA can fully identify the 
correct party.)
    Finally, the systems will not automatically fill in the 
registration number on any documents or electronic screens that are 
provided to, or appear, to the submitter or transmitter.
    To minimize the burden, the interim final rule only requires 
registration numbers for shippers (if the shipper is a facility 
required to register for that article of food) and the manufacturer. 
The interim final rule also states when a registration number is not 
required in a prior notice for these persons. Under section 415 of the 
FD&C Act, registration is only required for food for consumption in the 
United States. Thus, the interim final rule does not require that a 
prior notice include registration numbers of facilities associated with 
articles of food that are imported or offered for import for 
transshipment, storage and export, or further manipulation and export. 
The interim final rule does not require a registration number for the 
manufacturer if the article of food is sent by an individual as a 
personal gift (i.e., for non-business reasons) to an individual in the 
United States.

[[Page 59002]]

2. Fax & E-mail Addresses
    (Comments) Some comments state that the fax number and e-mail 
address should be optional.
    (Response) FDA agrees, in part, and has eliminated the requirement 
for telephone and fax numbers and e-mail addresses in many instances. 
In the interim final rule, the telephone and fax numbers and e-mail 
addresses (if they exist) are only required for submitters and 
transmitters so that FDA can communicate with them, if necessary. The 
prior notice submission must declare if these persons do not have a 
telephone number, fax number, or e-mail address.
3. Submitter and Transmitter (Sec.  1.281(a)(1) and (a)(2) Proposed as 
Sec.  1.288(a))
    The proposed rule required the identity of the submitter and the 
associated submitting firm.
    (Comments) Comments addressing the submitter focused primarily on 
who is authorized to submit prior notice and on the need for 
registration numbers and fax and e-mail information.
    (Response) Comments regarding who may submit, as well as comments 
regarding registration numbers and telephone, fax, and e-mail 
information already have been addressed.
    As explained in the proposal, the identification of the submitter 
is needed so that FDA knows who is responsible for the information in 
the prior notice and can communicate with them when necessary. The 
information is also necessary to follow up when audits, inspections, or 
enforcement are necessary.
    The FDA PN System Interface will allow the information transmitted 
for identification of the submitter to be automatically repeated in the 
same submission if the submitting firm is also any other firm 
identified in the prior notice, such as the transmitter, importer, 
owner, ultimate consignee, etc. This ability to automatically repeat 
information may also be available for transmitters submitting prior 
notice through ABI/ACS, depending on the features of the ABI software 
package used by the transmitter.
    (Interim final rule) Section 1.281(a)(1) requires submission of the 
name of the individual submitting the prior notice, i.e., the 
submitter, and his or her business address, and telephone number, fax 
number, and e-mail address (if they exist), as well as the name and 
address of the submitting firm associated with the submitting 
individual, if it exists.
4. Transmitter (Sec.  1.281(a)(2))
    The proposed rule allowed an agent to provide prior notice.
    (Comments) Comments on the use of agents to provide prior notice 
are discussed under Sec.  1.278.
    (Response) Responses to comments on the use of agents are discussed 
under Sec.  1.278.
    (Interim final rule) If the prior notice is transmitted by a person 
other than the submitter, Sec.  1.281(a)(2) requires the name of the 
individual transmitting the prior notice, i.e., the transmitter, on 
behalf of the submitter and his or her business address, telephone 
number, fax number, and e-mail address, if they exist. The submission 
must also include the name of the firm associated with the individual 
transmitting the prior notice information, if it exists. The 
identification of the transmitter is needed so that FDA may confirm the 
prior notice, communicate regarding the prior notice after FDA review, 
and followup when audits, inspections, or enforcement are necessary.
5. CBP Entry Type (Sec.  1.281(a)(3) Proposed as Sec.  1.288(b))
    The proposed rule required the submission of the Customs entry type 
associated with the article of food being imported or offered for 
import (proposed Sec.  1.288(b)).
    (Comments) Comments state that the CBP entry type is not always 
available by noon of the day before arrival. They also note that entry 
type may change depending on quota status, e.g., where a consumption 
entry was planned but then was changed to a warehouse entry because an 
entry quota on the product was temporarily filled or closed.
    (Response) FDA and CBP believe that the significant shortening of 
the prior notice timeframe resolves many of the concerns about the 
availability of the CBP entry type. As discussed in the proposed rule, 
FDA needs this information for screening to identify the appropriate 
articles for inspection. It is also needed for communication with FDA 
and CBP staff at the border. Also, entry type determines which entry 
identifiers should be used (entry number, in-bond number) to identify 
the shipment. In addition, the CBP entry type tells us if the article 
of food is for consumption in the United States or is for export or 
other uses that, in turn, allows FDA to determine that certain 
information is not required (e.g., registration numbers).
    (Interim final rule) Section 1.281(a)(3) of the interim final rule 
requires submission of the entry type. Some examples of entry types are 
listed as follows: Consumption entries, warehouse entries, and 
temporary importation bond entries. Each of these types has a 
designated CBP code. For prior notice submissions made through ABI/ACS, 
the entry type will consist of the CBP entry code specific for that 
type of entry, e.g., ``01'' for a consumption entry, ``21'' for a 
warehouse entry, ``23'' for a temporary importation bond entry, etc. 
These codes are ones customs brokers and self-filers currently provide 
to CBP at entry. For prior notice submissions made through the FDA PN 
System Interface, applicable entry types or other admission categories 
will be provided for selection in a drop-down menu, e.g., consumption, 
IT, T&E, mail, FTZ, etc. Explanations of the different entry types or 
other admission categories will be available to help the transmitter 
choose the right one.
6. ACS Entry Line Number or Other Customs Identification Number (Sec.  
1.281(a)(4) Proposed as Sec.  1.288(c))
    The proposed rule required the identification of the CBP entry 
number, the CBP ACS line number and the FDA line number. FDA explained 
that this information is necessary for screening and identification of 
the appropriate articles for inspection, as well as for matching the 
prior notice to the corresponding CBP entry to assess the adequacy of 
the prior notice when shipments arrive and are presented for review.
    (Comments) Comments state that the CBP entry number is available 
only from a customs broker or self-filer, but not every import has a 
broker. Other comments state that the entry number is not assigned 
until the customs broker or self-filer transmits entry information 
through the ABI to ACS. Thus, the entry number is not available by noon 
of the day before arrival. Other comments state that entry and line 
numbers are not available earlier than 4 hours before arrival at land 
ports. Some comments suggest that FDA make this information voluntary.
    (Response) FDA agrees in part and has removed the requirement for 
submission of line numbers. The interim final rule only requires 
submission of a CBP entry identifier. FDA believes that the entry 
identifier is necessary for proper identification of the information in 
a prior notice with the appropriate articles for inspection. FDA also 
believes that submission of the entry identifier is critical for 
matching the prior notice to the corresponding CBP entry, which is 
necessary to assess the adequacy of the prior notice when shipments 
arrive and are presented for review. For in-bond entries and FTZ

[[Page 59003]]

admissions, and for prior notices submitted through the FDA PN System 
Interface, an entry identifier is critical for matching the prior 
notice to the corresponding CBP entry if a consumption entry is 
submitted so FDA and CBP can ensure that prior notice requirements were 
satisfied. For transmitters submitting prior notice with CBP entry 
information through the ABI/ACS interface, the CBP entry number 
assigned by CBP is also the entry identifier. For customs brokers or 
self-filers submitting prior notice for a food entering the United 
States as an IT entry, a T&E entry, or FTZ admission, the CPB in-bond 
number or FTZ admission number assigned by CBP is also the entry 
identifier.
    If prior notice is being submitted through the FDA PN System 
Interface, the entry identifier will depend on the entry type and the 
reason for Web submission. If available to the transmitter (e.g., the 
prior notice is for a CBP entry but the ABI/ACS interface is not 
available), the CBP entry number must be used. Where appropriate, the 
in-bond number must be used as the entry identifier. If one of the 
entry identifiers described above does not exist, the transmitter can 
request a system-generated entry identifier. The FDA PN System 
Interface will provide online help to assist the user in determining 
what information to use as the entry identifier for a specific 
transaction.
    This requirement to provide an entry identifier does not apply to 
articles of food imported or offered for import by international mail, 
nor those carried by or accompanying an individual, unless entry is 
otherwise required by CBP and an associated CBP entry identifier has 
thus been assigned. In these cases, the FDA PN System Interface will 
apply a system-generated entry identifier.
    FDA agrees with the comments that line numbers are not necessary. 
Thus, the interim final rule does not require submission of a line 
number. For transmitters using the FDA PN System Interface, the system 
will assign each article of food a unique number for processing and, 
after validation, a PN Confirmation Number will be returned for each 
article of food. For ABI/ACS submissions, when they are confirmed, the 
CBP and FDA line numbers will be assigned as they are under current 
procedures, and the customs broker or self-filer will receive a 
confirmation number for each line through the OASIS/ACS messaging 
process.
7. Product Identity (Sec.  1.281(a)(5) Proposed as Sec.  1.288(e)(1))
    Section 801(m)(1) of the Bioterrorism Act states that a prior 
notice must contain the identity of the article of food being imported 
or offered for import. To ensure that each prior notice adequately and 
completely identifies the food being imported or offered for import, 
Sec.  1.288(e)(1) of the proposed rule required the submission of the 
following information: FDA product code; common, usual, or market name; 
brand name; quantity; and lot, code, or other identifying number.
    a. General comments on product identity. (Comments) Some comments 
ask that FDA obtain product identity information from existing Customs 
information. Other comments believe that the information on product 
identity should be limited to a general description of the product.
    (Response) Under section 801(m) of the FD&C Act, FDA must have the 
information before arrival. Thus, although product identity is provided 
to CBP when entry is filed, currently that does not generally occur 
sufficiently before arrival for FDA to review and respond as envisioned 
by the Bioterrorism Act. Under the interim final rule, with the 
modifications to ABI/ACS, required product identity information can be 
provided through ABI/ACS. The transmission to CBP will be enhanced to 
include the additional product identity information required by prior 
notice, and will be used satisfy both FDA's prior notice requirements 
as well as current entry requirements.
    FDA does not agree that product identity should be limited to a 
general description. For prior notice to accomplish its intended 
purpose and help FDA protect American consumers, a precise description 
of the product is necessary. For example, FDA needs to know that there 
are 100 cartons containing 24/12 ounce (oz) bottles of apple juice and 
200 cartons containing 48/8 oz bottles of apple juice to make its 
decision whether to inspect, sample, or hold a shipment. Information 
about potential contamination may apply only to 8 oz bottles of apple 
juice. Therefore, it would be a drain on FDA resources, as well as 
cause delays at the border, to examine and sample all juice or all 
apple juice imports when only one kind of juice in one kind and size of 
packaging is affected. Currently, this information is provided to FDA 
when entry information is submitted via the ABI/ACS interface by a 
customs broker or self-filer. For those entries submitted via a paper 
mode, the invoice is included in the submission, as it was before OASIS 
and ABI/ACS. The precise description of a food product is commonly 
included on a commercial invoice, e.g. 200 cartons of 24/6 oz cans of 
albacore tuna.
    (Comments) One comment asks for clarification as to how an 
``article'' of food is defined.
    (Response) The description of an ``article'' of food is not the 
same as the definition of ``food'' in Sec.  1.276(b)(5). An ``article'' 
refers to a single food that is associated with the same complete FDA 
Product Code, the same package size, and the same manufacturer or 
grower. These requirements are found in the information required in the 
interim final rule in Sec.  1.281(a)(5), (a)(6), or (a)(7) and again in 
Sec.  1.281(b) and (c).
    (Comments) Some comments assert that the proposed rule increases 
the paperwork burden by requiring separate notices for every article 
from a different manufacturer or grower. Comments recommend that one 
way to reduce this burden would be to allow a single prior notice to 
cover a shipment of multiple articles of food or allow one notice per 
shipment.
    (Response) FDA disagrees. An article of food is a unique item 
related to a specific manufacturer or grower and a specific process or 
size. All of these pieces of information are critical for a risk-based 
assessment of the food. FDA currently receives most of this information 
from customs brokers or self-filers via ABI/ACS. The ABI/ACS system 
also provides the capability to submit information for multiple food 
items as lines in a single entry, when entry level information is 
consistent for a number of articles in a shipment. For example, 
shipment level information, such as estimated time of arrival, can be 
captured once for all articles within a shipment. The ability to 
minimize data entry by copying specific information from one article, 
or line, to another depends upon the sophistication of the software 
being used to create the submission to CBP. The FDA PN System Interface 
is designed to allow for simplified submission of similar articles of 
food by allowing the submitter to easily repeat common information 
(e.g., FDA product code, manufacturer, etc.) while entering different 
quantities (e.g., amount and package size). Both systems will thus 
significantly reduce the amount of repetitive entry of information 
while preserving the identity of each article of food.
    b. Complete FDA product code (Sec.  1.281(a)(5)(i) Proposed as 
Sec.  1.288(e)(1)(i)). FDA proposed to require the submission of the 
complete FDA product code as an element of the identity of the product 
(Sec.  1.288(e)(1)(i)).

[[Page 59004]]

The FDA product code is a unique numeric code currently used by FDA and 
customs brokers and self-filers to describe food products, as well as 
other products regulated by FDA.
    (Comments) The majority of comments emphasize the need to use the 
existing and familiar HTS coding structure for product reporting 
instead of the FDA product code. Some comments ask FDA to update 
product codes with current food items, such as botanicals, additives, 
food contact substances, etc. Some comments state that the importer 
might not know the exact product they will be receiving until the 
product is shipped and, therefore, may not know the FDA product code by 
noon of the day before arrival. One comment recommends clarification of 
what the FDA product codes are and where they can be found. In 
addition, another comment was not able to access the FDA product 
database and urges FDA to correct this situation. Finally, one comment 
suggests that FDA eliminate this data element.
    (Response) The FDA product code is an existing 7-character code 
that describes a product for FDA purposes by industry type and class, 
packaging, process, and specific distinctive character. For example, 
canned tuna is covered by FDA Product Code, 16AEE45. ``16A'' describes 
the product as vertebrate fish, the first ``E'' describes the metal 
package, the second ``E'' describes a commercially sterile process, and 
``45'' describes the fish as tuna.
    Although the HTS codes are currently utilized by CBP and FDA to 
identify generally which imports are subject to an FDA admissibility 
review, these codes are often not sufficient to specifically identify a 
product for FDA decisionmaking. For example, in many cases, the tariff 
code does not describe how the product was processed (e.g., 
commercially sterile or shelf-stable) or how the product is packaged. 
For example, milk and cream are included in the same codes. These codes 
differentiate milk and cream for fat content, but do not indicate the 
process (pasteurization and refrigerated or commercially sterile) or 
packaging (cardboard carton, plastic bottle, or shelf-stable package). 
Thus, several products that FDA considers different from each other 
(because these differences affect the potential safety of the food) may 
be combined under one tariff number HTS code.
    Both the HTS code and the FDA product code are currently required 
on FDA-regulated products and are submitted through the ABI/ACS 
interface. Therefore, the FDA product code is familiar to most of those 
who will be transmitting prior notice. The FDA product code is 
currently available via the Internet at http://www.accessdata.fda.gov/scripts/ora/pcb/pcb.htm as a ``buildable'' code.
    FDA is requiring submission of this data element for prior notice 
as an integral part of the identity of the article. Risk-based 
screening criteria can be very specific. Therefore, the specificity 
provided by the FDA product code is necessary. In addition, the timing 
requirements for submitting prior notice have been decreased 
significantly. Therefore, the issue of adequately identifying the 
product code at the time of submission has been reduced to the extent 
possible, given the mandate from Congress to require prior notice.
    The FDA PN System Interface has a menu-driven FDA product code 
builder that enables the submitter to appropriately describe the 
product. The FDA PN System Interface is also designed to allow a 
submitter who already knows the product code to enter it directly.
    FDA routinely and continually updates the FDA product codes and 
product code builder electronic files to include more specific food 
items, such as additives, exotic produce, and some botanicals. FDA 
intends to issue guidance before the effective date of this rule that 
will provide the flagged HTS codes and FDA product codes identifying 
foods for which prior notice is required. This guidance will be posted 
at http://www.fda.gov, see ``prior notice.''
    (Interim final rule) Section 1.281(a)(5)(i) requires the complete 
FDA product identity code for the article of food covered by a prior 
notice. The interim final rule allows for submission of product 
identity information through ABI/ACS. Customs brokers or self-filers, 
using ABI/ACS, currently may use the FDA product code builder, which is 
available to the public on the FDA Web site, to identify the 
appropriate product code. Those submitting prior notice through the FDA 
PN System Interface will be able to access a FDA product code builder 
specific to those food covered by the prior notice requirement.
    c. Common, usual or market name (Sec.  1.281(a)(5)(ii) Proposed as 
Sec.  1.288(e)(1)(ii)). FDA proposed to require the submission of the 
common or usual or market name of the article of food as an element of 
the identity of the product (Sec.  1.288(e)(1)(ii)). The customs broker 
or self-filer currently submits the common or usual or market name to 
ABI/ACS when entry is made, and it subsequently is transmitted to OASIS 
for each entry line, e.g., article of food.
    (Comments) One comment is concerned that the appropriate name of 
fresh produce or fishery products may not be known at the time of 
shipment.
    (Response) This information is necessary to confirm the accuracy of 
the product code and we have thus retained the requirement to submit it 
in the interim final rule. The timing requirements for submitting prior 
notice have been decreased significantly. Therefore, the issue of 
adequately identifying fresh produce and ``catch of the day'' at the 
time of submission has been reduced to the extent possible, given the 
mandate from Congress to require prior notice.
    (Interim final rule) Section 1.281(a)(5)(ii) requires that the 
submitter supply the common or usual or market name in a prior notice. 
(See 21 CFR 102.5 for additional information about common or usual 
names.)
    d. Trade or brand name (Proposed Sec.  1.288(e)(1)(iii)). FDA 
proposed to require the submission of the trade or brand name of the 
article of food, if it is different than the common or usual or market 
name, as an element of the identity of the product (Sec.  
1.288(e)(1)(iii)).
    (Comments) Comments ask for clarification as to why this 
information is required when the statute does not require it and the 
information will likely be confusing if provided. Commenters also 
recommend eliminating this data element. Comments state that some 
imported products do not have a trade or brand name (e.g., agricultural 
products, fish, and seafood). In addition, comments note that a single 
product could have multiple brand names. Several comments note that the 
importer usually does not know a product's brand or trade name. 
Comments also recommend that FDA clarify in the final rule that it will 
not reject an article of food for failure to include trade or brand 
name when such information does not exist.
    (Response) FDA agrees with the comments. FDA has also determined 
that this information is not critical for risk-based screening, given 
the other information in a prior notice.
    (Interim final rule) FDA has eliminated the requirement to identify 
the trade or brand name in the interim final rule.
    e. Quantity (Sec.  1.281(a)(5)(iii) Proposed as Sec.  
1.288(e)(1)(iv)). FDA proposed to require the submission of the 
quantity of food described from smallest package size to largest 
container as an element of the identity of the product (Sec.  
1.288(e)(1)(iv)). The number of

[[Page 59005]]

container units and units of measure are to be submitted in decreasing 
size of packing unit (starting with the largest). The customs broker or 
self-filer currently submits the quantity of each line entry to ABI/ACS 
when entry is made, and quantity subsequently is transmitted by CBP to 
OASIS. FDA requested comments on whether changes in quantity will occur 
after the deadline for prior notice and, if so, how commonly changes 
occur and how significant the changes usually are.
    (Comments) There were many comments pertaining to quantity. Some 
commenters object to the requirement, stating that it can be difficult 
to identify quantity. For example, comments suggest that it can be 
difficult to identify quantity for processed goods, as quantity may 
change. Also, the exact quantity is difficult to identify for fresh 
produce and fresh fishery products due to the fast-paced shipping of 
perishables and day-to-day harvesting differences. Comments state that 
it is also difficult to ascertain the exact unit (e.g., weight, volume) 
for bulk items. Comments also state that quantity information such as 
package size is not relevant to identify the presence of intentional 
contamination or a food safety hazard. Some comments object to the 
level of specificity, stating that the required quantity data is unduly 
detailed for inspection purposes, seldom needed for risk assessments, 
and not necessary to meet the statutory requirements. Other comments 
recommend that FDA allow a 2-hour amendment/update for needed 
flexibility and accurate reporting or adopt a percentage over/under 
discrepancy tolerance or approximated total units (e.g., weight, 
volume). Comments confirm that changes in quantity occur after the 
proposed deadline for prior notice and that these changes commonly 
represent significant variations in quantity.
    (Response) FDA continues to believe that quantity is a necessary 
component of product identity. The significant decrease in the filing 
deadlines addresses concerns raised by many comments. In addition, in 
further response to the comments on changes in quantity, FDA has 
revised the requirement to ``estimated quantity.'' This means that the 
submitter must tell FDA, at the time of submission of Prior Notice, the 
estimated amount of the article of food that they anticipate will be 
shipped. This change provides importers with leeway to adjust 
shipments, while still ensuring FDA has useful information about 
overall quantity.
    FDA believes that package size is necessary and part of product 
identity. The base unit of measure is a critical characteristic of 
product identity and is thus necessary for effective review of the 
prior notice information. Base unit is critical to processing safety 
requirements and is particularly important when evaluating the safety 
of low-acid canned foods. Both base unit and total quantity (which 
includes knowing the smallest ``package size'') are necessary for 
response (examination) and communication with FDA and CBP staff at the 
border. As noted in FDA's ``Food Security Preventive Measures Guidance 
for Importers'' (Ref. 17), they are also critical for food security 
examinations to determine if the amount ordered is the amount received. 
For example, if more was received than was ordered, the guidance 
recommends an investigation to determine the cause of the discrepancy 
as additional and unwanted articles may have been added to 
intentionally contaminate the shipment. If less product is received 
than ordered or than shipped, some of the product may have been 
intentionally diverted. Both base unit and total quantity are currently 
data elements that can be submitted via ABI/ACS to OASIS. The tutorial 
in the FDA product code builder will be revised to recommend the 
appropriate association of base unit with product code, e.g., FDA 
Product Code 16AEE45, canned tuna would recommend the base unit as **oz 
cans.
    (Interim final rule) Section 1.281(a)(5)(iii) requires that the 
prior notice state the estimated quantity of food that will be shipped 
from largest container to smallest package size. Some examples of 
quantity descriptions are: 100 cartons of 48/6 oz cans each of tuna; 
100 pallets of 2/100 pound (lb) totes each of frozen tuna loins for a 
total of 20,000 lb; 100 pallets of 2/100 lb cartons each of dehydrated 
pig ears for a total of 20,000 lb; 100 cartons of 20 lb of fresh 
watermelons each carton for a total of 2,000 lb, and 2,000 lb of wheat 
in bulk. A prior notice will not be inadequate if the estimated 
quantity changes between the confirmation of prior notice and the time 
of arrival. The interim final rule does not require that a prior notice 
be cancelled and resubmitted if the estimated quantity changes after 
confirmation.
    f. Lot or code numbers or other identifier (Proposed Sec.  
1.288(e)(1)(v)). FDA proposed to require the submission of the lot or 
code numbers or other identifiers that are specific to the article of 
food, if applicable, as an element of the identity of the product 
(proposed Sec.  1.288(e)(1)(v)). Currently, when entry information is 
presented to FDA through ABI/ACS, lot or code numbers may be 
transmitted as ``affirmations of compliance'' and there may be more 
than one identifier represented in an entry line.
    (Comments) Comments state that the addition of lot, code, or other 
identifier information is burdensome and not valuable for inspection 
purposes. In addition, often the lot numbers are simply unknown. 
Comments ask that FDA clarify, if this data element is retained, what 
``lot or code number or other identifier'' means and how it should be 
entered, such as by bar code, letters, or random number. Comments also 
ask that FDA consider that there is no lot or code number for bulk or 
commingled products. Many comments suggest that FDA consider making 
this data element voluntary or removing it completely.
    (Response) FDA agrees in part. The lot or code numbers are the 
identification numbers or code of a production lot, which can more 
specifically identify a product for screening and examination purposes 
and for communication within FDA and with CBP and the grower or 
manufacturer, etc. For example, recalls involving serious health risks 
are often associated with a specific production lot, such as 
counterfeit infant formula or underprocessed canned food. FDA screening 
targets examinations based on information of public health emergencies 
or recalls in foreign countries. FDA regulations already require lot/
code identifiers for some foods. Currently, low acid canned foods, 
acidified foods, and infant formula are required to bear lot codes or 
other identifiers (see 21 CFR 113.60(c) (low-acid canned foods); 21 CFR 
114.80(b) (acidified foods); and 21 CFR 106.90 (infant formula low-acid 
canned foods)). The interim final rule requires lot/code or other 
identifiers only for these kinds of articles of foods. Many other foods 
may have lot or code identifiers that are not required by FDA 
regulation; submission of these identifiers is optional under the 
interim final rule.
    (Comments) Some comments object to the limitation in the proposed 
rule that each lot number of a food would need its own prior notice and 
asserted that FDA should permit multiple lot numbers to be identified 
in one prior notice.
    (Response) FDA agrees. Multiple lot numbers may be identified for 
an article of food. The systems are set up to permit such submissions.
    (Interim final rule) Section 1.281(a)(5)(iv) provides that lot or 
code numbers or other identifiers are required in a prior notice for 
articles of food that are required to bear such numbers by the FD&C Act 
or by FDA

[[Page 59006]]

regulations. Submission of the required lot/code identifier will be 
accommodated by ABI/ACS as an affirmation of compliance or through the 
FDA PN System Interface. ACS currently allows for submission of more 
than one affirmation of compliance per article of food. The FDA PN 
System Interface will accept more than one lot identifier per article 
of food.
8. Manufacturer (Sec.  1.281(a)(6) Proposed as Sec.  1.288(f))
    As provided for in section 801(m)(1) of the FD&C Act, FDA proposed 
to require the submission of the identity of the manufacturer of each 
article of food. The customs broker or self-filer currently submits the 
identity of the manufacturer to ABI/ACS when entry is made, and it 
subsequently is transmitted to OASIS.
    (Comments) Some comments state that some foods are not processed or 
manufactured food, e.g., certain wild-caught or agricultural products; 
therefore, a manufacturer cannot be identified.
    (Response) FDA agrees. Identification of a manufacturer only is 
required for a food that is no longer in its natural state. The FDA PN 
System Interface will recognize (by FDA product code) these foods. The 
manufacturer field must be completed for these foods (identified by FDA 
product code); if it is not completed, the initial validation will 
reject the submission through ABI/ACS or the FDA PN System Interface. 
Guidance regarding FDA product codes that require prior notice, which 
FDA intends to issue before implementation of this rule, will identify 
which product codes should be associated with a manufacturer.
    FDA also recognizes that if an article of food is sent by an 
individual as a personal gift (i.e., for nonbusiness reasons) to an 
individual, what will be available to the sender will be the name and 
address of the firm that appears on the label. Thus, this information 
may be supplied and a registration number need not be provided.
    (Interim final rule) Section 1.281(a)(6) of the interim final rule 
requires that the identity of the manufacturer of an article of food 
that is no longer in its natural state be submitted as part of prior 
notice. However, if the article of food is sent by an individual as a 
personal gift (i.e., for non-business reasons) to an individual in the 
United States, the name and address of the firm that appears on the 
label under 21 CFR 101.5 may be submitted.
9. Grower, If Known (Sec.  1.281(a)(7) Proposed as Sec.  1.288(g))
    As required by section 307 of the Bioterrorism Act, FDA proposed to 
require the submission of the identity of all growers of each article, 
if known, and the growing location if different from the grower's 
business address (proposed Sec.  1.288(g)). If the submission is 
amended, the proposed rule required that the identity of all growers 
must be provided if known at the time of the amendment (Sec.  
1.290(d)).
    FDA solicited comments on whether the FD&C Act gives FDA any 
flexibility to exempt or otherwise treat differently so-called 
processed foods produced with products from more than one grower. FDA 
also solicited comments on whether the term ``grower'' includes a 
harvester or collector of wild products, e.g., some fish and 
botanicals.
    (Comments) A comment states that the agency does not need to 
identify flexibility to exempt processed foods produced with products 
from one or more grower, but rather should recognize that there is not 
a grower of a processed food.
    (Response) FDA agrees. Once an article of food, for prior notice 
purposes, is no longer in its natural state, it has a manufacturer, but 
not a grower.
    (Comments) A commenter states that it is an extremely rare 
occurrence for any single imported lot of a wild botanical raw material 
to have been collected by a single collector. Rather, the comment 
believes that the most common practice of consolidating a single lot of 
wild-harvested botanical raw material involve the product of many dozen 
or even hundreds of individual collectors.
    (Response) FDA agrees and considers a harvester or collector to be 
the grower for the purposes of this provision as the definition of 
grower reflects Sec.  1.276(b)(6)). The interim final rule also allows 
for the identification of a consolidator, when the submitter does not 
know the identities of all harvesters or collectors at the time of 
submission of the prior notice.
    (Comments) Comments assert that if the grower is known, then 
workload for submission of prior notice will increase immensely. The 
comments recommend submitting a one-time listing of all growers that 
supply the importing firm with product and the responsible party could 
update the list as needed or keep a complete grower list with each firm 
and supply it to FDA when needed.
    (Response) The proposed regulation restated the statutory 
requirement. FDA does not agree that a list would satisfy the statutory 
requirement, as it would not tell FDA which grower was associated with 
the particular article of food as envisioned by the statute.
    (Comments) Comments state that it is very difficult to identify a 
grower for commingled products (fresh produce, fishery products, and 
grain) and such identification is not a typical industry practice. 
Comments also ask FDA to define ``bulk,'' and specifically how to 
address this issue with bulk grain.
    (Response) There is only one grower per article of food that is not 
in its natural state. Thus, tomatoes from two different growers are 
different articles of food offered for purposes of prior notice. 
However, FDA has decided that if the identity of all growers is not 
known for an amount of raw agricultural product consolidated from more 
than one grower, including grain or aquacultured fishery products, the 
consolidator firm may be identified in the grower identity data field. 
FDA emphasizes that the submitter may opt to provide the name and 
address of the firm that has consolidated the articles of food from 
different growers or different growing locations only when the 
submitter does not know the identity of any of the growers of the 
consolidated food. If the submitter knows the identity of any grower 
for consolidated foods, a separate prior notice must be submitted for 
each article of food represented by a known grower.
    For example, if consolidator X commingles tomatoes from 5 growers 
into one lot of 90 cartons and the submitter does not know the 
identities of any of those 5 growers, then the submitter may opt to 
provide the identity of consolidator X. If consolidator X commingles 
tomatoes from 3 growers (growers A, B, and C) into one lot of 90 
cartons and, although the submitter knows the identities of the 
growers, none of the tomatoes can be associated with the grower (no 
grower specific identifier accompanies each carton), then the submitter 
may opt to provide the identity of consolidator X.
    If consolidator X commingles 30 cartons of tomatoes from grower A 
with 30 cartons of tomatoes from grower B and 30 cartons of tomatoes 
from grower C and the submitter knows the grower associated with each 
of those 30 carton lots, then each of those 30 carton lots represents 
an article of food and a separate prior notice must be submitted for 
each. However, if consolidator X commingles 30 cartons of tomatoes from 
grower A with 60 cartons of tomatoes commingled from other growers and 
the submitter knows the identity of grower A, then that 30 carton lot 
can be identified by grower and represents an article of food. Two 
prior notices are

[[Page 59007]]

required: The first prior notice would cover 30 cartons of tomatoes and 
must identify grower A; the second prior notice would cover the 
remaining 60 cartons, and the submitter may opt to identify 
consolidator X.
    When bulk grains are commingled, they lose their association with 
each grower and the identity of grain would then be associated with the 
facility that commingled, i.e., consolidated, the grain in a silo or 
truck or rail car before shipment. The submitter may opt to provide the 
identity of this consolidator in the prior notice.
    (Comments) Comments suggest that FDA define ``if known'' and 
provide guidance as to the extent of effort that should be applied to 
find grower information and what will satisfy ``if known.''
    (Response) Section 801(m)(1) of the FD&C Act requires that grower 
information be submitted (or provided to the transmitter for 
submission) if it is known. Thus, this information is not optional: If 
it is known by the submitter, it must be submitted. For purposes of 
this rule, FDA considers the information to be known if the submitter 
is aware of or learns the grower name and growing location due to 
business relationships. FDA is not requiring the submitter to seek out 
information of which the submitter is not aware. However, if the 
identity of the grower is in the possession of the submitter (e.g., on 
documents), we believe the submitter is aware of the identity of the 
grower.
    (Comments) Comments state that if knowing the grower is such 
crucial information, then it should be made mandatory.
    (Response) Because the statute provides the identification of the 
grower ``if known,'' FDA does not have the authority under section 
801(m) of the FD&C Act to require the identification of the grower in 
cases where that identity is not known to the submitter.
    (Interim final rule) Section 1.281(a)(7) requires that a prior 
notice identify the grower, if known to the submitter for an article of 
food that is in its natural state. If a food comes from more than one 
grower, a prior notice must provide for an article of food associated 
with each grower, if their identity of that grower is known. As stated 
previously under discussion of product identity, an ``article'' refers 
to a single food that is associated with the same complete FDA Product 
Code, the same package size, and the same manufacturer or grower. FDA 
has determined that identification of the grower and the growing 
location address is a more appropriate identifier than the address of 
the grower. Therefore, FDA has revised the interim final rule to 
require the grower name and growing location. We have eliminated the 
grower's address. The interim final rule also allows that if the 
submitter does not know the identity of the grower or, if the article 
of food has been consolidated, the identity of any of the growers, the 
submitter may provide the name and address of the firm that has 
consolidated the articles of food from different growers or different 
growing locations.
    As stated previously under discussion of ``manufacturer,'' the FDA 
system will recognize (by FDA product code) which products should be 
associated with a grower and will recognize (by FDA product code) which 
products should be associated with a manufacturer. Thus, if the 
manufacturer field is completed for a food that is in its natural state 
(as identified by FDA product code), the system will not accept the 
transmission. Guidance, which FDA intends to issue before 
implementation of this rule, regarding FDA product codes that require 
prior notice will identify which product codes should be associated 
with a grower. Submission of prior notice via the FDA PN System 
Interface will allow for association of ``header information'' with an 
article of food so that the transmitter would only have to identify 
list each grower and growing location. Each would be identified with a 
separate PN Confirmation Number associated with an entry identified. 
(See description under discussion of lot/code identifier in the 
previous paragraph in section III.H.7.f of this document.) A similar 
capability may be possible for submission through the ABI/ACS 
interface, but that is dependent upon the ABI software used by the 
broker or self-filer.
10. FDA Country of Production (Sec.  1.281(a)(8) Proposed as Sec.  
1.288(h)--Originating Country)
    As provided for in section 801(m)(1) of the FD&C Act, FDA proposed 
to require the submission of the identity of the originating country of 
the article of food (proposed Sec.  1.288(h)). This term was defined in 
proposed Sec.  1.277(c)(2) as the country where the article of food was 
grown and harvested or if manufactured/processed, where the article of 
food was produced. It is proposed, that if the article of food is wild 
fish or seafood and it is harvested in the waters of the United States 
or by a U.S. flagged vessel or processed aboard a U.S. flagged vessel, 
the FDA Country of Production is the United States.
    (Comments) Comments ask that FDA clarify which country should be 
identified when the major component of the final processed food may 
have come from a number of countries. Comments point to blended or 
decaffeinated coffee or apple juice produced from fresh apples and 
apple concentrates from more than one country as examples of such 
foods. Comments also ask that FDA clarify the definition of 
``originating country'' to mean the country in which the product was 
last processed.
    (Response) For a food that is no longer in its natural state, the 
FDA Country of Production is the country where the article of food was 
made. Therefore, for a food such as decaffeinated coffee or apple 
juice, the FDA Country of Production is the country in which the 
facility that made the food is located. For example, if the 
decaffeinated coffee is produced in Country C by decaffeinating a blend 
of coffees from Country A and Country B, the FDA Country of Production 
is Country C.
    (Interim final rule) The interim final rule in Sec.  1.281(a)(8), 
requires that a prior notice contain the FDA Country of Production of 
the article of food being imported or offered for import into the 
United States. As set out in its definition at Sec.  1.276(b)(4), the 
FDA Country of Production is, for an article of food is in its natural 
state, the country where the article of food was grown, including 
harvested or collected and readied for shipment to the United States. 
If, however, an article of food is wild fish, including seafood, that 
was caught or harvested outside the waters of the United States or by a 
that is not registered in the United States, the FDA Country of 
Production is the country in which the vessel is registered. For a food 
that is no longer in its natural state, the FDA Country of Production 
is the country where the article of food was made. However, if an 
article of food is wild fish including seafood, that was made aboard a 
vessel, the FDA Country of Production is the country in which the 
vessel is registered. The interim final rule also provides that the FDA 
Country of Production of food grown and harvested or collected or made 
in a U.S. Territory is the United States.
11. Shipper (Sec.  1.281(a)(9) Proposed as Sec.  1.288(i))
    As provided for in section 801(m)(1) of the FD&C Act, FDA proposed 
to require the submission of the identity of the shipper of the article 
of food (proposed Sec.  1.288(i)). The shipper is typically not the 
carrier.
    (Comments) A comment states that this information could be obtained 
from Customs' AMS.
    (Response) Although CBP's AMS contains information concerning the

[[Page 59008]]

shipper, that information is located in the AMS module of ACS and is 
not currently available to FDA, as required under section 801(m) of the 
FD&C Act, which provides that the information must be submitted to FDA. 
CBP and FDA have concluded that it is not practical, at this time, to 
attempt to modify AMS and the ACS-OASIS interface to provide this 
information to FDA.
    (Interim final rule) Sec.  1.281(a)(9) requires that the shipper be 
included in a prior notice. The interim final rule defines shipper 
(Sec.  1.277(b)(12)) as the owner or exporter who consigns and ships 
the article of food from a foreign country or the person who sends an 
article of food in international mail to the United States.
12. Country From Which the Article Is Shipped (Sec.  1.281(a)(10) 
Proposed as Sec.  1.288(j))
    As provided in section 801(m)(1) of the FD&C Act, FDA proposed to 
require the submission of the identity of the country from which the 
article of food was shipped (proposed Sec.  1.288(j)). This term is 
defined in proposed Sec.  1.277(c)(3) as the country in which the 
article of food was loaded onto the conveyance that brings it to the 
United States.
    (Comments) Several comments state that this provision would require 
submission of information that FDA could obtain from Customs' AMS.
    (Response) Although AMS contains information concerning the country 
from which the article of food is shipped, that information is located 
in the AMS module of ACS and is not currently available to FDA, as 
required under section 801(m) of the FD&C Act which provides that the 
information must be submitted to FDA. CBP and FDA have concluded that 
it is not practical, at this time, to attempt to modify AMS and the 
ACS/OASIS interface to provide this information to FDA.
    (Interim final rule) Section 1.281(a)(10) requires that the country 
from which the article is shipped be included a prior notice. The 
interim final rule defines the country from which the article is 
shipped (Sec.  1.277(b)(3)) as the country in which the article of food 
is loaded onto the conveyance that brings it to the United States.
13. Anticipated Arrival Information (Sec.  1.281(a)(11) Proposed as 
Sec.  1.288(k))--Anticipated Port of Entry, Anticipated Date of 
Arrival, Anticipated Time of Arrival)
    FDA proposed to require the submission of the anticipated port of 
entry (defined as port of arrival), the anticipated date and 
anticipated time when the article of food will arrive at the port of 
entry in the United States (proposed Sec.  1.288(k)) to coordinate 
resources for inspections, examinations, or sampling. FDA also proposed 
to require the prior notice to be updated if any of the anticipated 
arrival information changes after the submission of the prior notice 
(proposed Sec.  1.288(k)(2)). Updates were deemed necessary so FDA 
could change its plan for coordinating resources when anticipated 
arrival information changes.
    a. General comments. (Comments) Comments state that the proposed 
rule is more restrictive than the Bioterrorism Act. Others suggest that 
importers would have to work 24 hours a day, 7 days a week and that the 
proposed rule would eliminate their current methods of doing business. 
Several commenters ask FDA to recognize commercial realities of weather 
and traffic problems that result in port and arrival time changes and 
to provide more flexibility on the information requirements or 
elimination of the requirements altogether. Comments state that a lack 
of flexibility would amount to a limitation of the port that is 
prohibited by the Bioterrorism Act and could impede trade. Other 
comments state flexible arrival requirements are what Congress 
envisioned and ask that FDA not refuse food at the border based on 
inadequacy of anticipated arrival information, changes in border 
crossing, and other problems beyond the control of the importer.
    (Response) The interim final rule requires that the prior notice 
identify the anticipated port of arrival. This information is necessary 
to ensure FDA can plan for inspections and communicate with CBP. FDA 
believes that the reduction of the timeframe for providing prior notice 
will reduce the number of changes that occur to the arrival information 
after submission. However, FDA also recognizes the realities of weather 
and traffic changes and has written the interim final rule to 
accommodate these variances.
    As section 801(m)(1) of the FD&C Act prohibits any limitation on 
ports, a prior notice will not be inadequate if the anticipated port of 
arrival, the anticipated date of arrival, or the anticipated time of 
arrival changes between the time of confirmation of prior notice and 
the time of arrival. This is reflected in Sec.  1.282(a) of the interim 
final rule that specifies what changes in information require 
resubmission of a prior notice. However, if FDA has determined that the 
article of food must be examined upon arrival and the anticipated 
arrival information has changed since timely submission of the prior 
notice, the article may be held by CBP at the port of arrival until the 
examination can be performed.
    b. Anticipated port of arrival. (Comments) Comments state it was 
unclear whether the prior notice was to specify a particular bridge 
crossing or the port itself.
    (Response) The anticipated arrival information must specify the 
anticipated port of arrival and, if there is more than one crossing 
location within that port, the anticipated crossing. For the most part, 
this applies to ports along the northern and southern borders of the 
United States where there are several crossings over many miles, but 
all are included in the same port. For example, a food arriving at the 
port of Buffalo-Niagara Falls may cross at the Peace Bridge or the 
Lewiston Bridge. For the purpose of this rule, to facilitate 
inspection, the identification of the bridge is required. However, the 
prior notice will not be inadequate if the anticipated crossing changes 
between the time of confirmation of prior notice and the time of 
arrival.
    (Comments) Several comments ask that FDA allow importers to choose 
alternate border crossings or ports because of possible traffic delays 
and adverse weather conditions for air and land modes of arrival, or 
changing flight destinations for air modes of arrival. Comments state 
importers and even shippers and carriers do not know which border 
crossing will be used until the food arrives. Some comments note that 
portions of food may be discharged at different ports of arrival at the 
discretion of the carrier due to cargo space and weight limitations.
    (Response) As noted previously, FDA agrees that arrival locations 
and times may change due to business practices, inclement weather, and 
traffic conditions. The interim final rule requires the submission of 
anticipated arrival information. This means that what must be submitted 
are the port, crossing location, date, and time that are known to the 
submitter at the time that prior notice is submitted to FDA. The 
interim final rule does not require that prior notice be cancelled and 
resubmitted if this information changes after FDA has confirmed the 
prior notice for review. A prior notice will not be inadequate if the 
anticipated port of arrival (including crossing location), the 
anticipated date of arrival, or the anticipated time of arrival changes 
between the confirmation of prior notice and the time of arrival.
    c. Anticipated date/time of arrival. (Comments) Several comments 
ask for

[[Page 59009]]

clarification on the definition of time of arrival. For arrival by 
water, comments suggest defining arrival as the time the vessel reaches 
the entrance to the seaport where the importer will be taking delivery, 
the time the vessel reaches the port, or the time the vessel is 
unloaded. For arrival by land and air, comments suggest defining 
arrival as the time the vehicle reaches the border crossing, the time 
the vehicle reaches traffic backed up at the border crossing, or the 
time CBP begins processing the vehicle.
    (Response) The interim final rule requires submission of 
anticipated time and date of arrival to provide FDA with information 
needed for planning resources for examinations of food at the border. 
From FDA's standpoint, ``time of arrival'' relates to when the food 
will first become available for examination at the border. For vessels, 
this would be when the vessel docks in the port. For planes, this would 
be when the plane lands. For land vehicles, such as trucks, buses, and 
trains, this would be when they cross at the border.
    (Comments) Some comments ask for clarification regarding which time 
zone to use. Comments are concerned that, due to time zones, food may 
appear to arrive in the United States before it leaves the country from 
which it is shipped. Some comments suggest FDA use the time zone of the 
port of arrival.
    (Response) The anticipated time and date of arrival relates to the 
time zone of the anticipated port of arrival. The time of prior notice 
submission, anticipated arrival, and actual arrival are all based on 
local time at the port of actual arrival.
    (Comments) Several comments state that it was impossible for 
importers to know the exact time of arrival until the food arrives 
because of possible traffic delays and adverse weather conditions for 
air and land modes of arrival, or changing flight destinations for air 
modes of arrival. Other comments state that shippers and even carriers 
do not know when the truck will arrive. However, some comments note 
that exporters would be likely to know what flight the shipment was on.
    (Response) The interim final rule requires the anticipated time and 
date of arrival. This is the time and date the submitter anticipates 
that the food will arrive at the port of arrival at the time the prior 
notice is submitted and confirmed for FDA review.
    (Comments) Comments also suggest that FDA obtain the arrival 
information from AMS.
    (Response) Although AMS contains some of this information, the 
information is located in the AMS module of ACS and is not available to 
FDA, as required under section 801(m) of the FD&C Act, which provides 
that the information must be submitted to FDA. CBP and FDA have 
concluded that it is not practical, at this time, to attempt to modify 
AMS and the ACS-OASIS interface to provide this information to FDA.
    (Comments) Several comments state that the 4-hour window for 
updates of arrival time is too small and would cause delay in the 
arrival of food and create extra work in the form of amendments. Thus, 
the comments conclude the 4-hour window is unreasonable and should be 
removed. Comments note that even the best-intentioned carrier could 
fail to make the appointment because of waits of at least 5 hours at 
the borders. Others state additional delays occur on the Mexican border 
because the loads must change carriers. Some comments state that it was 
nearly impossible to predict an arrival time for a vessel within a 4-
hour window because ships may arrive in port several days ahead or 
behind schedule and may sit in a harbor for hours or days before being 
granted permission to dock. Thus, these comments conclude the window 
for updates is not realistic for sea transportation. Others state the 
window for updates is impractical for rail transportation. Importers of 
live animals comment that the window for updates would be impossible to 
meet. Several comments suggest that FDA seek alternatives. One comment 
suggests a 6-hour window for updates. Another suggests importers be 
permitted to provide prior notice to FDA 2 hours before the carrier 
reaches the border. One comment suggests that prior notices identifying 
certain FDA-selected border crossings not be held to the arrival time 
and not be required to update the prior notice at the time of arrival.
    (Response) The interim final rule requires submission of 
anticipated arrival information to provide FDA with information 
necessary for planning examinations and communicating with CBP for 
enforcement and examination purposes. FDA believes that the requirement 
for submitting anticipated arrival information serves these purposes. 
FDA has decided to delete the requirements for updating anticipated 
arrival information because of the reduction of the time requirements 
for submission. FDA recognizes that some of the anticipated information 
may change after submission due to unforeseen circumstances, such as 
business practices of carriers, weather conditions, and traffic 
conditions.
    (Interim final rule) The interim final rule (Sec.  1.281(a)(11)) 
requires the submission of the anticipated port of arrival, including 
crossing location, if applicable, and the anticipated date and 
anticipated time when the article of food will arrive at that port. The 
interim final rule does not require that this information be updated if 
it changes after prior notice had been confirmed by FDA for review. The 
interim final rule does not require that a prior notice be cancelled 
and resubmitted if any of the anticipated arrival information changes 
after confirmation.
14. Port Where Entry Will Be Made for Customs Purposes (Proposed Sec.  
1.288(l))
    FDA proposed to require the submission of the identification of the 
port where entry will be made for Customs purposes (Sec.  1.288(l)). 
Often, this port is different from the port where the article of food 
arrived in the United States. FDA proposed that this information is 
necessary to facilitate communication with CBP and FDA field offices 
concerning the adequacy of the prior notice and to enable FDA to 
coordinate resources for inspections, examinations, or sampling.
    (Comments) A comment questions the usefulness of the information 
and asks that FDA delete the requirement because the Customs and FDA 
ports of entry can be different ports. Another comment states that 
providing the information would cost additional resources and time for 
investigation.
    (Response) FDA agrees. Due to interfacing with ABI/ACS and 
development of various means of communication with CBP, this 
information is no longer necessary in the prior notice submission. 
Accordingly, FDA has eliminated this information requirement in the 
interim final rule.
    (Interim final rule) The interim final rule does not require 
submission of the port where entry will be made for Customs purposes.
15. Anticipated Date of Customs Entry (Proposed Sec.  1.288(m))
    FDA proposed to require the submission of the anticipated date of 
entry for U.S. Customs purposes (proposed Sec.  1.288(m)). FDA proposed 
that this information is critical to enable it to allocate resources 
for inspecting imported food shipments and efficient communication with 
and between CBP and FDA field offices.
    (Comments) Several comments ask that FDA eliminate this 
requirement. Comments note that the Customs date of entry is not 
required by the Bioterrorism Act. Comments state that since the

[[Page 59010]]

Customs entry might be a considerable distance from the actual port of 
arrival, the date of Customs entry is difficult to predict. Another 
comment questions the usefulness of the Customs date of entry in 
determining whether to inspect the products at the port of arrival. A 
few comments ask for clarification of the Customs entry process.
    (Response) FDA agrees. FDA has eliminated the Customs date of entry 
in the interim final rule. Due to interfacing with ABI/ACS and 
development of various means of communication with CBP, this 
information is no longer necessary in the prior notice submission.
    (Interim final rule) The interim final rule does not require 
submission of the anticipated date of Customs entry.
16. Importer, Owner, Ultimate Consignee (Sec.  1.281(a)(12), (a)(13), 
and (a)(14) Proposed as Sec.  1.288(n), (o), and (p))
    Under section 801(m)(2)(B)(i) of the FD&C Act, an article of food 
that is imported or offered for import with inadequate notice may not 
be delivered to the importer, owner, or consignee. Thus, FDA proposed 
to require their identities so that FDA can take steps to ensure that 
food refused admission under section 801(m) of the FD&C Act is not 
delivered to them illegally. FDA proposed that only one importer, 
owner, and consignee could be identified for each prior notice.
    (Comments) Some comments argue that section 307 of the Bioterrorism 
Act does not require the prior notice to identify the importer, owner, 
or consignee of the article of food that is the subject of the notice. 
They recommend that this requirement in the proposed rule be eliminated 
as beyond the scope of the statute and unnecessary for the purposes of 
section 307 of the Bioterrorism Act. One comment argues that FDA should 
not require submission of information about the consignee. However, 
another comment states that the level of detail required is generally 
consistent with the information submitted by customs brokers acting as 
agents for importers of record.
    (Response) As requested by some of the comments, FDA considered 
deleting this information or making identity of importer, owner, and 
ultimate consignee optional. However, section 801(m) of the FD&C Act 
explicitly prohibits delivery of an article refused under section 
801(m) to the importer, owner, or consignee. Section 801(l) of the FD&C 
Act likewise prohibits delivery of an article of food that has been 
imported from an unregistered foreign facility that is required to be 
registered under section 415 of the FD&C Act and 21 CFR part 1, subpart 
H. If we do not know the identity of these persons, we cannot determine 
if an article of food that has been refused or placed under hold has 
been illegally diverted and delivered. Accordingly, we have determined 
that this information is critical to ensure that we can efficiently 
enforce the prohibitions in section 801(m) and (l). In requiring this 
information, FDA is relying on both sections 801(m) and (l) and 701(b) 
of the FD&C Act.
    Moreover, information identifying the importer of record and 
consignee is currently provided as part of the existing entry process 
(under OMB control number 0910-0046). Under the interim final rule, the 
CPB and FDA entry submission may be used to satisfy prior notice. We 
estimate that 80 percent of prior notices will be submitted through the 
CPB ABI/ACS entry process. We are concerned that deleting this 
information or making it optional for prior notice purposes could 
create considerable confusion about whether the information was still 
required for entry and admissibility purposes. For FDA, these pieces of 
information are necessary for administering section 801(a) of the FD&C 
Act and its implementing regulations, which require that FDA provide 
notice of sampling and notice of intent to refuse admission to the 
owner or consignee. Indeed, the identities of consignees and importers 
of record have long been provided to FDA. Prior to the availability of 
OASIS, FDA was provided with this information about imported foods on 
the FDA Form 701 (Ref. 18). In addition to the name and address of the 
importer of record and the consignee, FDA Form 701 included information 
such as: Entry number and date, bill of lading number, port of lading, 
country of origin, port of unloading, port of entry, value, container 
number, vessel name, arrival date, location of lot, date available, 
contact phone number, broker identification, manufacturer/shipper, 
quantity, packaging description, and a description of the food 
including the Food Canning Establishment number. Since the availability 
of OASIS, all information that has been submitted through the ABI/ACS 
interface has also included name and address of the importer of record 
and the ultimate consignee. Those who do not provide entry information 
electronically through ABI/ACS submit a ``paper'' entry to CBP and also 
provide FDA paper notification that includes information on importer 
and consignee. Some still use the FDA Form 701.
    (Comments) One comment asserts that the identity of the consignee 
is proprietary, implying that it is protected from disclosure to FDA.
    (Response) Where consignee information is proprietary, it is likely 
to be ``confidential commercial information'' and protected from public 
disclosure. However, the fact that it is considered ``proprietary'' is 
not a bar to requiring it in prior notice and entry submissions.
    (Comments) Other comments ask that FDA decrease the burden of 
providing this information by using the registration number, which FDA 
could use to obtain the other identity information elements from its 
databases
    (Response) FDA agrees in part. Although the interim final rule does 
not require the registration numbers of the importer, owner, or 
ultimate consignee, the FDA PN System Interface allows for submission 
of the name of the firm and limited address information (city and 
country) when a registration number is provided.
    (Comments) Other comments seek to decrease the burden by asking FDA 
to require information regarding the entity submitting the prior 
notice, which could be the importer, owner, or consignee, but not 
regarding all three. Another comment concedes that FDA should require 
the identification of the owner, but that the owner is often the 
importer or the consignee.
    (Response) FDA agrees. The FDA PN System Interface provides the 
transmitter with the ability to easily repeat information, e.g., the 
submitter is the same as the importer or the owner is the same as the 
ultimate consignee. This feature may also be available for submission 
through ABI/ACS, depending on the specific ABI software used by the 
customs broker or self-filer. The identity of the owner is only needed 
if it is not the same as the importer or the ultimate consignee.
    (Comments) Several comments state that FDA should be able to 
communicate its admissibility decisions and decisions about prior 
notice adequacy with the importer.
    (Response) As set out in the interim final rule, in the first 
instance, the carrier will be notified regarding refusals under section 
801(m) of the FD&C Act. Information identifying the importer will allow 
FDA to follow up with the importer and develop procedures for notifying 
them as well.
    (Comments) A comment asks that FDA define ``importer'' consistently 
with CBP. Another comment expresses confusion as to the meaning of the 
term ``owner,'' asking whether the requirement for the owner's identity 
in

[[Page 59011]]

the prior notice refers to the owner of the article of food at the time 
it arrives at the port of arrival.
    (Response) FDA believes that the persons affected by this interim 
final rule will know, in most situations, what entities are referred to 
by the terms ``importer'' and ``owner'' since these terms are commonly 
used in importation, including the CBP entry process. If experience 
with this interim final rule indicates confusion regarding these terms, 
then FDA will issue guidance on them.
    Regarding the term, ``importer,'' FDA agrees with the comment. The 
agency believes this term should be interpreted the same as ``importer 
of record'' as that term is used by CBP in regard to the entry of 
merchandise.
    Regarding the term, ``owner,'' FDA agrees that this is the owner of 
the article of food at the time of arrival. However, if a prior notice 
is given after the article is refused under section 801(m)(1) of the 
FD&C Act, then the owner is the owner or the article of food at the 
time the prior notice is submitted.
    (Comments) Comments ask FDA to limit the information required to 
identify the importer, owner, and consignee to the registration number, 
which FDA could use to obtain the other identity information elements 
from its databases. In this way, comments seek to decrease the burden 
of prior notice submission by avoiding manual entry of addresses. Other 
comments seek to decrease the burden by asking FDA to require 
information regarding the entity submitting the prior notice, which 
could be the importer, owner, or consignee, but not regarding all 
three.
    (Response) The interim final rule does not require the registration 
number of the importer, owner, or ultimate consignee. However, if a 
registration number is provided, city and country may be provided 
instead of the full address.
    (Comments) A comment states that the identification of the 
importer, owner, and consignee could be obtained from AMS.
    (Response) Although AMS may contain information concerning the 
consignee, that information is located in the AMS module of ACS and is 
not available to FDA, as required under section 801(m) of the FD&C Act, 
which provides that the information must be submitted to FDA. CBP and 
FDA have concluded that it is not practical, at this time, to attempt 
to modify AMS and the ACS/OASIS interface to provide this information 
to FDA.
    (Interim final rule) Section 1.281(a)(12), (a)(13), and (a)(14) of 
the interim final rule require submission of information that 
identifies the importer, owner, and ultimate consignee. However, the 
identification of the importer, owner, and ultimate consignee are not 
required if the article of food is imported or offered for import for 
transshipment through the United States under a T&E bond.
17. Mode of Transportation (Sec.  1.281(a)(15))
    In the proposed rule, the timeframe for prior notice was the same 
for all imports, regardless of mode of transportation. Thus, FDA did 
not propose submission of the identification of the mode of 
transportation.
    (Comments) No comments were received on identification of the mode 
of transportation. However, as discussed earlier, many comments 
recommend that FDA should set the timeframes for prior notice by mode 
of transport. FDA agrees and has revised the timeframes accordingly.
    (Response) In the interim final rule, the timeframes are tied to 
mode of transportation. Thus, mode of transportation is necessary to 
calculate when prior notice is timely. In addition, FDA has determined 
that, for submitting prior notice, identification of the mode of 
transportation is necessary for identification of the article of food 
at the time of arrival for the purposes of planning examinations and 
communicating with CBP for enforcement and examination. This 
information currently is provided to FDA by customs brokers or self-
filers through ACS.
    (Interim final rule) Section 1.281(a)(15) requires submission of 
information concerning the mode of transportation, except for those 
prior notice submissions covering articles of food arriving by 
international mail. For submissions through ABI/ACS, this information 
will take the form of the current ABI requirements for declaration of 
mode of transportation. For submissions through the FDA PN System 
Interface, selection of the mode of transportation will be accommodated 
by a drop-down menu.
18. Carrier (Sec.  1.281(a)(16) Proposed as Sec.  1.288(q))
    FDA proposed to require the identity of each carrier or transporter 
firm that transports the article of food from the country from which 
the article was shipped into the United States, including the 
submission of the SCAC. Identification of the carrier is necessary to 
enable FDA and U.S. Customs to identify the appropriate article of food 
for inspection or holding when the food arrives in the United States. 
FDA notes that a carrier typically is a different firm than the 
shipper. The broker or self-filer currently submits carrier information 
to ABI/ACS when entry is made, and it later is transmitted to OASIS.
    (Comments) Comments agree that this information is helpful and 
necessary for locating cargo. Comments note that carrier information is 
currently submitted to CBP via ABI/ACS to OASIS. Other comments state 
that accurate carrier information cannot be provided by 12 noon the day 
before arrival.
    (Response) FDA believes that identification of the carrier is 
necessary for the purpose of response to prior notice, both for 
examination purposes and communication with CBP. The shortened 
timeframes resolve the concern that the carrier may not be known by 
noon the day before arrival, to the extent possible, given the mandate 
from Congress to require prior notice.
    (Comments) Comments ask that FDA eliminate the requirement to 
identify multiple carriers, suggesting that the only pertinent carrier 
is the one arriving at the U.S. port.
    (Response) FDA agrees and has eliminated the requirement to 
identify each and every carrier that transported the article of food 
from the country of production to the United States, i.e., multiple 
carriers. The interim final rule requires submission of the identity of 
the carrier that is or will be carrying the article of the food from 
the country from which the article is shipped to the United States.
    (Interim final rule) Section 1.281(a)(16) requires submission of 
the carrier's SCAC or IATA code. If these codes are not applicable, the 
carrier's name and country must be submitted.
19. Planned Shipment Information (Sec.  1.281(a)(17))
    The proposed rule did not require submission of planned shipment 
information beyond identification of the carrier.
    (Comments) Some comments suggest that, in addition to carrier 
information, FDA should require vessel name, voyage/flight numbers, and 
bill of lading information.
    (Response) FDA agrees. FDA has determined that additional planned 
shipment information is necessary for identification of the article of 
food for examination and communication with CPB. The requirement is to 
provide planned shipment information as it exists when the prior notice 
is submitted. FDA recognizes that some of this information may change 
after the

[[Page 59012]]

prior notice has been submitted and has addressed this in Sec.  
1.287(a), which specifies when changes require resubmission to FDA. 
Most of this information is currently submitted to FDA by customs 
brokers or self-filers through ABI/ACS. The planned shipment 
information is necessary to ensure the effective enforcement of section 
801(m) of the FD&C Act. FDA and CBP have determined that the planned 
shipment information includes submission of HTS code information. The 
HTS code is particularly critical for communication between FDA and CBP 
for shipments that are entered for transportation in-bond without 
appraisement under 19 U.S.C. 1552 or 1553, and identification of the 
HTS will assist CBP in the efficient processing of prior notice through 
ACS. CBP uses the HTS number in ACS to ensure that the required FDA 
information accompanies the entry or entry summary transmitted through 
ABI/ACS to OASIS. For prior notices submitted through the FDA PN System 
Interface, the HTS numbers are needed to ensure that the data collected 
from the Customs entry when it is transmitted through ABI/ACS can be 
matched to prior notice.
    (Interim final rule) Section 1.281(a)(17) requires submission of 
the following planned shipment information, as applicable, based on the 
mode of transportation:
    [sbull] Airway bill number(s) or bill of lading number(s) (not 
applicable to food carried by or otherwise accompanying an individual);
    [sbull] For food arriving by ocean vessel, vessel name and voyage 
number;
    [sbull] For food arriving by air carrier, flight number;
    [sbull] For food arriving by truck, bus, or rail, trip number;
    [sbull] For food arriving as containerized cargo by water, air, or 
land, container number(s);
    [sbull] For food arriving by rail, car number (not applicable to 
food carried by or otherwise accompanying an individual);
    [sbull] For food arriving by privately owned vehicle, the license 
plate number and state or province; and
    [sbull] The 6-digit HTS code that is applicable to the article of 
food.
    The interim final rule does not require that prior notice be 
cancelled and resubmitted if this information changes after FDA has 
confirmed the prior notice for review. A prior notice will not be 
inadequate if any of the planned shipment information changes between 
the confirmation of prior notice and the time of arrival.
20. International Mail (Sec.  1.281(b))
    FDA did not propose separate information requirements for prior 
notice for food imported or offered for import by international mail.
    (Comments) No comments were received on information requirements 
for food imported or offered for import by international mail.
    (Response) For clarity and ease of reference, the interim final 
rule segregates the information required in prior notice submissions 
for food arriving by international mail. In addition, FDA has clarified 
the information required in three instances. FDA has replaced 
anticipated arrival information with planned date of mailing. FDA has 
determined that identification of the recipient of an article of food 
arriving by mail is necessary instead of the importer, owner, or 
consignee. Thus, the interim final rule requires the identification of 
the recipient by name and address for food arriving by international 
mail. Finally, we also have not included information identifying the 
mode of transportation, carrier, planned shipment information, and hold 
information, as this information is not relevant to mail imports.
    (Interim final rule) See table 1A in section II.J of this document 
for the information requirements for food imported or offered for 
import by international mail.
21. Refused Food (Sec.  1.281(c))
    FDA did not propose separate information requirements for prior 
notice for food refused because of inadequate prior notice. However, 
proposed Sec.  1.288(d) required identification of the location where 
the food is being held after the food had been refused for inadequate 
prior notice. This information is necessary to ensure FDA can locate 
the food for inspection and to ensure compliance with the hold 
requirement.
    (Comments) No comments were received on separate information 
requirements for food refused because of inadequate prior notice. 
However, comments ask for clarification that the hold location 
information is only necessary if the prior notice was absent or 
inadequate, e.g., the article of food has been refused under section 
801(m) of the FD&C Act.
    (Response) FDA agrees. For clarity and ease of reference, the 
interim final rule segregates the information required in prior notice 
submissions for food refused because of inadequate prior notice. 
Submission of the hold location information is not necessary for prior 
notice submissions covering an article of food arriving by 
international mail.
    (Interim final rule) See table 1A in section II.J of this document 
for the information requirements for food refused under section 801(m) 
of the FD&C Act.
    (Summary of the interim final rule) Table 1A in section II.J of 
this document shows a summary of all information required by Sec.  
1.281(a), (b), and (c). For clarity, the table also identifies under 
what circumstances certain information is not required, e.g., 
registration numbers.

I. ``What Must You Do If Information Changes After You Have Received 
Confirmation of a Prior Notice From FDA?'' (Section 1.282 Proposed as 
Sec. Sec.  1.289 through 1.294)

1. ``What Changes Are Allowed to a Prior Notice After It Has Been 
Submitted to FDA?'' (Proposed Sec.  1.289)
    FDA proposed to allow changes to certain information in the prior 
notice after a prior notice was submitted. FDA proposed to allow 
amendments to the product identity information when complete product 
identity did not exist by the deadline for the submission of a prior 
notice and updates to arrival information. The proposed rule also 
required that, if the identity of the grower was not known at the time 
of initial submission of the prior notice, but was known at the time of 
submission of amended or updated information, the identity of all known 
growers must be submitted. The proposed rule required that, in the 
event that other information in the prior notice changed, no amendment 
or update was permitted, and the prior notice must be cancelled and 
resubmitted.
    (Comments) Comments ask FDA to be more flexible in allowing changes 
to prior notices. Some comments state that the time periods for prior 
notice and amendments and updates are not workable and should be made 
flexible. Comments note that requiring notice by noon of the day before 
the anticipated importation would cause an increased amount of 
amendments and updates.
    Some comments note that the high degree of detail required in the 
prior notice will increase the need for amendments and that the 
likelihood of amendments will be more than FDA estimated. Some comments 
state that if the timeframe for submitting prior notice was changed, 
i.e., shortened to 4 hours for land and air and 8 hours for water, then 
amendments and updates would not be necessary.

[[Page 59013]]

    (Response) FDA agrees with the comments that state that if the 
deadline for submission of prior notice were reduced, amendments and 
updates would not be necessary. FDA has chosen timeframes that provide 
it with very little leeway in the time it has to ``receive, review and 
respond'' to the prior notice submissions. Thus, we concluded that we 
could no longer permit changes to prior notice without restarting the 
clock. In addition, the use of ABI/ACS precludes amendments and 
updates: changes to ABO/ACS submissions that have been electronically 
transmitted to FDA's OASIS and confirmed by FDA for review are not 
feasible because CBP also needs finality so it can complete its own 
screening of the entry. Therefore, the interim final rule does not 
allow for changes to a prior notice after the transmitter has been 
notified that FDA has confirmed the prior notice for review.
    (Comments) One comment asks that FDA clearly define the 
circumstances under which updates and amendments to submissions of 
prior notice must be made. One comment asks FDA to clarify that a 
change in the anticipated arrival information is not the same as a 
product identity amendment and, therefore, is not subject to the same 
mandates as the procedure for changes in the product identity.
    (Response) Because the interim final rule does not provide for 
amendments and updates, there is no need to address these comments 
asking for clarification.
    (Comments) Some comments suggest that FDA allow amendments to all 
information in the prior notice. Some comments state that it is likely 
that companies filing numerous prior notices will inadvertently make 
clerical errors, such as telephone or fax numbers, Customs ACS entry 
line numbers, or Customs entry type. Others ask for clarification of 
any penalties associated with cancellation of a prior notice and 
resubmission of a correct notice.
    (Response) FDA believes that the reduction of the deadline for 
submission of prior notice and the revisions to the information 
required have eliminated much of the need for amendments. FDA notes 
that transmitters should try to avoid clerical errors that could result 
in unnecessary rejections or refusals. To assist, FDA has designed the 
FDA PN System Interface to review presentation of some information 
before confirmation. The FDA PN System Interface will reject certain 
information if it is in the wrong format or does not match FDA's 
databases and the transmitter will be given an opportunity to make 
corrections during the submission process, before notice of 
confirmation from FDA that the prior notice has been submitted for 
review. The interim final rule provides for no penalty if a prior 
notice is cancelled. If prior notice has been submitted and confirmed 
and the food is no longer imported or offered for import, the prior 
notice should be cancelled. However, if the article of food is still 
imported or offered for import into the United States, submission of a 
corrected and timely prior notice is necessary.
    (Interim final rule) Section 1.282 of the interim final rule 
requires that if the information except estimated quantity, anticipated 
arrival information, and planned shipment information changes after the 
transmitter receives notice that FDA has confirmed the prior notice for 
review, the prior notice should be canceled. If the article of food is 
still intended for import or will be offered for import, the prior 
notice must be resubmitted in accordance with this subpart. If you 
submitted the prior notice via the FDA PN System Interface, you should 
cancel the prior notice via the FDA PN System Interface. If you 
submitted the prior notice via ACS, you should cancel the prior notice 
by requesting that CBP delete the line or entry. The ``clock'' restarts 
after the confirmation of the submission containing the corrected 
information.
2. ``Under What Circumstances Must You Submit a Product Identity 
Amendment to Your Prior Notice After You Have Submitted It to FDA?'' 
(Proposed Sec.  1.290)
    FDA proposed that product identity information required by proposed 
Sec.  1.288(e)(1) may be amended if all of the information about the 
identity of the food did not exist by 12 noon of the calendar day 
before the day of arrival. The proposed rule also provided that the 
common or usual or trade name, brand name, lot or code or 
identification numbers, and quantity may be amended. FDA also clarified 
that a prior notice may not be amended to change completely the 
identity of the article, e.g., a prior notice identifying the food as 
lettuce may not be amended to identify the food as pears. The proposed 
rule provided that prior notice may be amended only once.
    (Comments) Some comments suggest that FDA allow unlimited 
amendments to any information requirement at any time. Several comments 
express concern about the limitation of only one amendment. They 
explain if the process has to start over again because the information 
changes after submitting one amendment, there would be an additional 2-
day delay before the product is allowed to cross the border. Some 
comments indicate that more than one amendment might be needed to 
provide accurate information. Some comments indicate specific 
additional information for which amendments should be allowed, such as 
the carrier and consignee.
    (Response) FDA has chosen timeframes that provide it with very 
little leeway in the time it has to ``receive, review, and respond'' to 
prior notice submissions. Thus, we concluded that we could no longer 
permit changes to prior notice without restarting the clock. However, 
the significant shortening in timeframes should address many of the 
concerns. In addition, the submission systems will allow for correction 
of errors revealed by the systems' initial validation. The interim 
final rule has thus eliminated the requirement for amendments.
    (Comments) One comment asks FDA to create an exemption from 
quantity amendments for bulk shipments for which the actual quantity is 
within 10 percent of the proposed actual quantity. (Response) The 
interim final rule requires submission of the estimated quantity. This 
revision nullifies the need for amendment to the quantity description 
by allowing the submitter to estimate the amount of food that is 
expected to arrive. The interim final rule provides for no penalty if 
the quantity of an article of food imported or offered for import 
differs from the quantity estimated in a prior notice.
    a. Intention to amend. The proposed rule required that the 
submitter must indicate his or her intention to amend the product 
identity information at the time the prior notice is submitted.
    (Comments) One comment contends that, if certain elements are 
amendable, FDA should not need additional advance notice of that fact. 
Other comments ask FDA to eliminate the requirement for the submitter 
to anticipate the need for an amendment. Other comments ask for 
clarification on whether the intent to amend or update must be evident 
on the initial prior notice or if a product identity amendment or 
arrival update can be made anytime within the minimum 2-hour 
requirement.
    (Response) The interim final rule eliminates the requirement for 
amendments and updates. Thus, comments on the proposed limitation are 
moot.
    b. Topping off. FDA recognized that the limitation on amendments 
might affect the practice of ``topping off a container'' by filling 
unused space in the shipping container or truck bed with last-minute 
shipments of other food

[[Page 59014]]

products not covered by prior notice. FDA solicited comments on how 
common ``topping off'' is and the quantities of food involved.
    (Comments) Comments state that it is common practice to fill extra 
space in a shipment with additional product after an order has been 
filled. A comment suggests that there should be an allowance for last 
minute changes in a load. A comment suggests that more flexibility is 
needed to avoid the extraordinary cost of importing a partial shipment. 
A comment states that a prohibition on the practice of topping off 
would make some shipments, particularly of smaller items, less cost 
competitive and may reduce the overall availability of some products. 
Another states that late offers to add additional quantities or even 
additional products to a shipment at a discount make for more efficient 
commerce for importers and can provide economy and value to American 
consumers. Another comment suggests that FDA reconsider and adopt in 
the final rule circumstances under which shippers could amend notices 
to include foods from the same manufacturer or grower. The comment 
further states that this would allow the full utilization of transport 
space even when that space is filled with additional items not 
explicitly declared in the original prior notice.
    (Response) The requirements of the statute are to provide FDA with 
notification of each article of food in advance of importation, not 
advance notice of some of the articles of food and post-arrival 
notification of others. The complete identity of each article of food 
is necessary for FDA to receive, review, and respond to the notice. FDA 
has significantly reduced the time required for submission of the prior 
notice before arrival. FDA has also revised the way information on 
quantity may be presented. The interim final rule requires the 
estimated quantity of the article of food. FDA believes that both of 
these revisions will allow for timely submission of accurate 
information and should limit, as much as is permissible under the 
statute, the effect of prior notice on the practice of ``topping-off.''
3. ``What Is the Deadline for Product Identity Amendments Under 
Proposed Sec.  1.290?'' (Proposed as Sec.  1.291)
    FDA proposed a 2-hour minimum deadline for product identity 
amendments submitted under proposed Sec.  1.291. FDA noted that product 
identity amendments are most likely to be needed for articles imported 
by land or air rather than water arrivals.
    (Comments) Some comments are supportive of a deadline for 
amendments of up to two hours before arrival, but only if that gave FDA 
sufficient time to receive, review, and respond to the information. 
Some comments state that allowing amendments to be submitted up to 2 
hours before arrival would not be problematic, while others contend 
that limiting amendments to two hours before arrival was too 
restrictive and would result in higher costs and compromised product 
integrity. Comments suggest changing the deadline to allow amendments 
up to 1 hour before arrival; until just before or at the time of 
arrival; after arrival (with a 3 hour limit, 24 hour limit, or no limit 
at all); or at any time before or after arrival. Several comments note 
that some information, such as the Customs entry number or quantity, 
cannot be verified by the proposed submitter until the shipment 
arrives. Several comments state that the carriers should be permitted 
to amend product identity information. A few commenters point out that 
the proposed 2-hour period for amendments before arrival is 
particularly problematic for multiple commodity exports. Comments 
indicate that the need for amendments might be identified at the time 
of loading, which may be less that one-half hour before arrival at the 
border.
    (Response) FDA has chosen timeframes that provide it with very 
little leeway in the time it has to ``receive, review and respond'' to 
the prior notice submissions. Thus, we concluded that we could no 
longer permit changes to prior notice without restarting the clock. In 
addition, as noted earlier, ACS cannot accommodate changes in 
submissions that have been confirmed by FDA for review. Therefore, the 
interim final rule does not provide for amendments.
4. ``How Do You Submit a Product Identity Amendment or an Arrival 
Update to a Prior Notice?'' (Proposed Sec.  1.292)
    The proposed rule required that a product identity amendment or an 
arrival update to a prior notice may be submitted only in the same 
manner as an initial prior notice; that is, electronically to FDA 
through the FDA PN System Interface.
    (Comments) A comment asks that the agency examine means by which 
communication to the agency of any unexpected change in this 
information can be provided by the entity that is actually 
knowledgeable about a change in the date of arrival, for example, by 
the ocean or air carrier. Several comments suggest that the carrier 
that is the party with the most accurate information on arrival time 
and can therefore provide the most efficient communication to FDA. 
Other comments raise concerns about providing unlimited discretion to 
carriers to make substantive changes to submissions, but note that the 
need for carriers to make ``updates'' is essential. One comment 
indicates that alternative mechanisms for the carrier to submit 
updates, such as touch-tone telephones, should be explored.
    (Response) Although requirements for amendments to product identity 
information and arrival updates have been deleted from the interim 
final rule, FDA recognized that several entities might have critical 
information concerning required prior notice information. Therefore, 
the interim final rule does not limit who can submit prior notice 
information. The interim final rule continues to require electronic 
submission of prior notice to FDA.
5. ``What Are the Consequences if You Do Not Submit a Product Identity 
Amendment to Your Prior Notice?'' (Proposed Sec.  1.293)
    FDA proposed that if a U.S. importer or U.S. purchaser, or their 
U.S. agent, informed FDA in a prior notice that the submission would be 
amended, but subsequently did not amend it appropriately and within the 
applicable timeframe, then the prior notice would be inadequate for the 
purposes of proposed Sec.  1.278(a). FDA clarified that the 
consequences of inadequate prior notice are the same as the 
consequences for failing to provide prior notice, e.g., the food is 
subject to refusal if admission. FDA explained that the indication that 
a prior notice would be amended tells us that the prior notice is 
incomplete. FDA noted that without complete product identity, the 
agency could not adequately determine whether to inspect or take other 
action when the food arrives in the United States.
    (Comments) Some comments object to the proposed provision that, if 
the submitter of a prior notice indicates that an amendment to the 
product identity will be submitted, but subsequently fails to do so, 
the original prior notice will be deemed inadequate and the product 
would not be allowed to enter. Some point out that FDA should not 
penalize a submitter for anticipating an amendment and then not 
amending the prior notice.
    (Response) For the reasons set forth previously, FDA has eliminated 
the requirement to provide product identity amendments.

[[Page 59015]]

6. ``What Must You Do if the Anticipated Arrival Information (Required 
Under Proposed Sec.  1.288(k)(1)) Submitted in Your Prior Notice 
Changes?'' (Proposed as Sec.  1.294)
    FDA proposed to require the submitter to update anticipated arrival 
information submitted in a prior notice, if the anticipated information 
changes after the submission. FDA proposed that if the time of arrival 
is expected to be more than 1 hour earlier or more than 3 hours later 
than the anticipated time of arrival, the time of arrival must be 
updated. FDA proposed that updates to the arrival information must be 
submitted 2 hours before arrival (proposed Sec.  1.294).
    a. General. (Comments) Many comments indicate that the window of 
time for arrival updates is too small. Several comments suggest 
changing the requirements for submitting updates for arrival 
information. Suggested changes included expanding the window for 
arrival to 2 hours and 6 hours before the anticipated arrival time and 
6, 7, 8, and 18 hours after the anticipated arrival time. A few 
comments state that notification of the day of arrival, not the time, 
should be sufficient. Some comments state that updates to arrival 
information should be allowed upon arrival at the border. One comment 
objects to allowing only one update to arrival information. The comment 
complains that this is very restrictive and that submitters must be 
allowed to keep updating the ``prior notice of arrival'' without 
worrying about the form being rejected.
    Some comments point out that the owner, importer, and U.S. agent 
often do not know the actual port of entry for a ship or airplane, the 
time of entry, or changes in this information. For example, an air 
shipment of seafood may be switched to a different plane, which arrives 
at the U.S. port outside the anticipated arrival window. This may occur 
during nonbusiness hours, before notification of the change can be 
provided.
    One comment suggests that exporters who choose to report to 
specific border crossings identified by FDA, should not be required to 
provide updates due to lateness in the time of arrival at the border.
    One comment states that ambiguity on when updates can be submitted 
might lead to confusion and inconsistent application of these 
provisions. The comment expresses concern that some ports may take the 
position that the update must be provided within the 4-hour window so 
FDA will be informed that the shipment will not be arriving when 
originally anticipated. Yet other ports may take the position that the 
update requirements are satisfied as long as the update is received at 
least 2 hours before arrival, regardless of how many hours or days it 
arrives after the originally identified arrival time.
    Some question how notifications that need to be amended and 
subsequent amendments for numerous entries could assist FDA in 
scheduling of inspections.
    Some point out that carriers should continue to be able to change 
ports of arrival, as necessary, to find a more expeditious route, based 
on weather and/or traffic conditions. One comment states that 
exporters/importers should be able to declare up to three possible 
ports of entry that all fall under the jurisdiction of a single FDA 
regional office for administrative and inspection purposes.
    One comment suggests that a requirement to update the port of entry 
could be viewed as limiting the port of entry, which is prohibited by 
the statute.
    One comment points out that the proposed rule is silent on changes 
to border crossings, unlike changes in arrival time and suggested that 
FDA clarify whether it needs to be notified of a change to the 
anticipated border crossing or if any border crossing is acceptable.
    b. Water. (Comments) One comment asks for a wider margin of 
variability for the arrival of ocean-going vessels. Some comments state 
that for ocean-going shipments, an update should not be required if the 
actual arrival at the port of entry is not more than 24 hours before or 
after the anticipated time of arrival specified in the prior notice. 
One comment notes that because of the logistics and unpredictability of 
ocean transport, it is not possible to accurately predict arrival time 
of a carrier within the 4-hour window provided. One comment notes that 
such tight time frames would increase the cost of the prior notice 
process because the submitter will be forced to continuously check on 
the status of the shipment to ensure that the arrival time is correct 
all the way up to 2 hours before delivery. For ocean imports, vessel 
arrival times may vary widely depending upon weather conditions, 
scheduling, and loading changes. Vessels can be held or delayed at 
various ports en route and importers are unlikely to be informed of 
these changes. Some comments state that it is unrealistic for a sea 
vessel to have to individually update hundreds or thousands of notices 
when the vessel is delayed. Comments ask that FDA allow a single update 
from a carrier to automatically update each prior notice associated 
with food products on that vessel.
    c. Air. (Comments) One comment states that the 2 hours for updates 
is not practical for air shipments because air carriers often do not 
inform importers of changes in arrival time until the cargo is close to 
its destination. One comment notes that because of current air and 
travel security procedures, arrivals are rarely at their scheduled 
times.
    d. Land/road. (Comments) A few comments indicate that with respect 
to trucks, there will be circumstances where a driver cannot contact a 
dispatcher to submit an arrival update, e.g., 2 a.m. The comments note 
that a large amount of border truck traffic flows in the early morning/
mid-to-late evening to avoid rush-hour traffic in major centers. 
However, shippers do not have a mechanism for submitting updates at 
these times when there are unforeseen delays that prevent arrival 
outside of the anticipated window. Comments state that FDA should 
provide flexibility in the rule for these and similar circumstances 
where, for legitimate reasons, it is not possible to provide an update.
    Some comments express concern about current delays for trucks at 
ports of entry, which may vary from a few minutes to 12 hours. The 
comments note that, because it is necessary to submit updates when a 
truck is outside the proposed time range for arrival, many trucks might 
be forced to sit idly on the side of the road waiting for their proper 
window when FDA will allow entry. Comments express concern that if a 
shipment were to miss the original arrival time, they would be forced 
to file an update and wait 2 hours to rejoin the line.
    e. Land/rail. (Comments) For rail cargo, arrival times may vary 
depending on scheduling and loading changes. Often, multiple rail cars 
on one entry can be located at multiple locations across the rail yard. 
Actual crossing times for those cars can vary widely depending on that 
location and the ability of the rail to load and cross them. In these 
cases, linking prior notice into the manifest could also allow the 
carrier to provide electronic updates.
    (Response) FDA agrees that there may be factors such as business 
practices, weather, and traffic congestion that may impact the accurate 
representation of the port, date, and time of arrival. Although the 
interim final rule will continue to require submission of the 
anticipated place, date, and time of arrival that is known to the 
submitter, the interim final rule does not require an update to that 
information, and prior notice will not be deemed inadequate if

[[Page 59016]]

the information changes after FDA has confirmed the prior notice for 
review.
    In sum, FDA has removed from the interim final rule all proposed 
sections related to product identity amendments and arrival updates 
(proposed Sec. Sec.  1.289 through 1.294) because of the following 
situations:
    [sbull] The timeframes are shortened substantially;
    [sbull] The timeframes provide us with very little leeway in the 
time we have to ``receive, review and respond'' to the prior notice 
submissions. Thus, we can no longer permit changes to prior notice 
without restarting the clock. FDA believes that the information 
required by the interim final rule for prior notice should be 
sufficiently fixed to be submitted within these new, shorter 
timeframes;
    [sbull] FDA has revised the required information in the interim 
final rule, including the requirement to provide the estimated 
quantity;
    [sbull] If the estimated quantity, the anticipated arrival 
information, or the planned shipment information change, the interim 
final rule does not require that the prior notice be resubmitted; and
    [sbull] Under the interim final rule, prior notice can be submitted 
through ABI/ACS. The proposed provisions for amendments and updates to 
a submission through ABI/ACS are not feasible after the submissions 
have been electronically transmitted to OASIS and confirmed by FDA for 
review.
    (Summary of the interim final rule) FDA has removed from the 
interim final rule all proposed sections related to product identity 
amendments and arrival updates (proposed Sec. Sec.  1.289 through 
1.294).

J. ``What Happens to Food That Is Imported or Offered for Import 
Without Adequate Prior Notice?'' (Section 1.283) and ``What are the 
Other Consequences of Failing to Submit Adequate Prior Notice or 
Otherwise Failing to Comply With This Subpart?'' (Sec.  1.284 Proposed 
as Sec.  1.278)

1. Inadequate Prior Notice (No Prior Notice, Inaccurate Prior Notice, 
or Untimely Prior Notice) (Sec.  1.283(a) Proposed as Sec.  1.278(a))
    FDA proposed in Sec.  1.278(a) that if an article of food is 
imported or offered for import with no prior notice or inadequate prior 
notice, the food shall be refused admission, as set out in under 
section 801(m)(1) of the FD&C Act. Proposed examples of inadequacy were 
untimely, inaccurate, or incomplete prior notice.
    (Comments) Comments ask for clarification on what would cause a 
prior notice to be incomplete or inadequate. Some comments express 
concern that clerical errors or failure to provide minor information or 
optional information could result in a refusal. Some comments suggest 
that inadequate prior notice should be confined to material omissions 
or major errors that would seriously impede the agency's ability to 
review and appropriately respond to the notice. Comments ask whether 
they would be notified about such deficiencies and given a chance to 
correct them. Some comments object to not receiving feedback, before 
reaching the port, when the prior notice is inadequate.
    (Response) A prior notice is not complete if the required 
information, as set forth in Sec.  1.281, has not been provided. 
However, FDA agrees that feedback during the transmission process to 
reduce mistakes and omissions that could result in unnecessary holdups 
or refusals is a good idea. As explained earlier, both systems will 
review and validate required information to minimize the likelihood 
that clerical or typographical errors will result in an incomplete or 
inaccurate prior notice. The systems will tell transmitters which 
required information is still lacking or is recognized by the initial 
validation as facially incorrect, to allow transmitters to make 
corrections quickly. Moreover, the systems will not provide a 
confirmation until required information is complete and facially valid. 
Thus, if the initial incorrect information is not corrected and 
submitted, the transmitter will not receive a prior notice 
confirmation. FDA believes that this initial review/validation process 
will help ensure that transmitters will not make inadvertent errors 
that could result in a refusal. We advise, however, that this initial 
review/validation process will not be capable of identifying all 
possible errors. Thus, submitters and transmitters should understand 
that confirmation does not mean that FDA has determined that the prior 
notice is accurate in all respects.
    If FDA determines that the prior notice is inaccurate after the 
systems provide a confirmation, the article of food is subject to 
refusal under Sec.  1.283(a)(1)(ii). FDA has the option of issuing the 
refusal notice to the transmitter under Sec.  1.283(a)(1)(ii) before 
arrival, assuming that FDA determines that the prior notice is 
inaccurate before arrival and before the time period for the prior 
notice has expired. If this happens, the transmitter must resubmit an 
accurate prior notice in accordance with Sec.  1.282. This will remove 
the refusal, although it will ``restart the clock'' in terms of when 
prior notice must be submitted to FDA. Until we have had some 
experience with prior notice review, we do not know how often we will 
be able to determine prior notice inaccuracy before food arrives. 
However, in certain situations, inaccuracy of prior notice cannot be 
determined until the article of food is examined upon arrival.
    (Comments) Comments suggest the regulation provide a waiver or 
other mechanism to release foods that are safe, although the electronic 
paperwork is not complete. Comments also suggest that the regulation 
provide that, unless FDA has credible evidence or information that an 
article of food presents a threat of serious adverse health 
consequences or death to humans or animals, that FDA would not refuse 
the article if the prior notice is incomplete or inadequate.
    (Response) FDA does not agree that the regulation should provide a 
waiver for refusal when some, but not all required, information has 
been submitted. Given that the purpose of prior notice is to provide 
FDA with better information sooner about food imports, including such a 
waiver in the rule would seem to be antithetical to the provision. The 
reference to the credible evidence standard in section 801(m) of the 
FD&C Act, which appears in the part of section 801(m) that deals with 
FDA review of prior notice after refusal, does not suggest otherwise. 
Section 801(m)(2)(B)(ii) of the FD&C Act states that, when FDA reviews 
a prior notice that has been submitted for a refused article of food, 
FDA ``shall determine whether there is in the possession of [FDA] any 
credible evidence or information indicating that such article presents 
a threat of serious adverse heath consequences or death to humans or 
animals.'' FDA does not agree that this provision means that FDA should 
not refuse food with an inadequate prior notice under section 801(m)(1) 
of the FD&C Act when FDA has no such credible evidence or information. 
If that is what Congress intended, it would not have provided for 
refusal of an article of food without adequate prior notice, as it did 
in section 801(m)(1) of the FD&C Act.
    (Comments) Comments note that the proposed rule did not set out 
procedures for notifications regarding refusals and holds. Comments ask 
who would be notified of refusal and when. Comments state that FDA 
should notify importers, purchasers, or manufacturers that an article 
is being held. One comment notes that carriers would have no way of 
determining if prior notice had been satisfied until they arrived at

[[Page 59017]]

the border, but that they would be responsible. A comment also states 
that FDA should engage the manufacturer or processor when the situation 
involves a bioterrorism threat or event.
    (Response) FDA and CBP have determined that the most appropriate 
notification point is the carrier. When an article of food arrives at 
the border without adequate prior notice (i.e., none, inaccurate, or 
untimely), the carrier is the clearest immediate point of contact that 
FDA and CBP staff at the border have. Thus, FDA or CBP intend to notify 
the carrier that the article of food is refused due to inadequate prior 
notice when the food is presented for CBP processing. It will be up to 
the carrier to communicate the prior notice refusal to other persons or 
firms. Neither FDA nor CBP currently has sufficient capability at the 
border to communicate these refusals to other persons and still process 
arrivals and examinations in a reasonable amount of time. We recognize 
that this will affect carriers. We will be exploring ways to provide 
notice to the transmitter and others, as well. FDA notes that if 
carriers want to ensure, for any food they are transporting, that prior 
notice has been submitted to FDA and confirmed for review, they can ask 
that a copy of the PN confirmation be provided to them. Indeed, under 
Sec.  1.279(g), for prior notices transmitted through the FDA PN System 
Interface, the carrier must present the PN confirmation number to CBP 
or FDA upon arrival.
    We do not agree that FDA should provide routine advance notice that 
it intends to refuse, examine, or hold food or has asked CBP to do so. 
Although FDA and CBP are structuring implementation to ensure that 
changes in ports and arrival times will not mean that food which should 
be refused, held, or examined at the port of arrival slips past us, we 
believe that routine advance notice could make it easier for the 
unscrupulous to evade FDA requirements and import unsafe food. Finally, 
whether we contact importers or manufacturers when there is a 
bioterrorism threat or other food-related emergency will depend on the 
particular circumstances.
    (Comments) Some comments state that inconsistency in time and 
changes in the port of arrival should not result in refusal of the 
article. One comment asks whether a shipment that arrives one-half hour 
late will be treated the same as one that arrives 12 hours late.
    (Response) As explained elsewhere, changes in the anticipated 
arrival information or planned shipment information will not be a basis 
for a refusal under section 801(m)(1) of the FD&C Act if FDA wants to 
examine the shipment; however, these changes may mean waiting while FDA 
is notified by CBP and arranges to examine the shipment. This is more 
likely to be the case with changes in ports and in arrivals that are 
much later than the anticipated time.
    When it comes to changes in arrival time, what matters is whether 
the prior notice time was submitted sufficiently in advance of arrival, 
in accordance with the timeframes set out in Sec.  1.279(a) of the 
interim final rule. These timeframes are what FDA has determined are 
necessary, as a general matter, to ensure that FDA has enough time to 
receive, review, and respond to each prior notice appropriately. 
However, Sec.  1.283(a)(1)(iii) of the interim final rule does provide 
that if an article of food arrives early, before the prior notice time 
has elapsed, its arrival will not be considered untimely if FDA has 
already reviewed the prior notice, determined its response to the prior 
notice, and advised CBP of that response. FDA believes there is no need 
to make the food wait if the agency has been able to accomplish its 
prior notice review sooner than anticipated.
    (Comments) One comment asks for clarification on whether the 
article would be refused if the classification of goods under the HTS 
code has been changed by Customs officials after the shipment arrives.
    (Response) If the FDA Product Code is accurate, then the article 
will not be refused if the HTS code provided is later changed by CBP 
during its review of the entry for CBP purposes.
    (Comments) One comment asks whether there would be a penalty for 
canceling and resubmitting a prior notice when the changes that need to 
be made to the prior notice cannot be made by an amendment or an 
update.
    (Response) FDA has removed the provisions relating to amendments 
and updates. If required information (with the exception of estimated 
quantity, anticipated arrival information, and planned shipment 
information) changes, e.g., the manufacturer is different than the one 
originally submitted or the complete FDA product code is not accurate, 
you should cancel the prior notice and must resubmit prior notice (if 
you still plan to import or offer for import the article of food into 
the United States). The timeframes set out in Sec.  1.279(a) of the 
interim final rule will start to run again from the time the new prior 
notice is confirmed for review by FDA.
    a. Status and movement of refused foods (Sec.  1.283(a)(2)). FDA 
proposed in Sec.  1.278(b) that if an article of food is imported or 
offered for import is refused under section 801(m)(1) of the FD&C Act, 
the food shall be held at the port unless directed to a secure facility 
under proposed Sec.  1.278(c). Proposed Sec.  1.278(d) provided that 
the person submitting prior notice was responsible for arranging for 
movement of refused food. Proposed Sec.  1.278(e)(2) stated that 
refused food could not be delivered under bond to the importer, owner, 
or consignee. In the preamble to the proposed rule (68 FR 5432), we 
explained that the provisions in title 19 of the U.S. Code relating to 
imports for which entry cannot be made would apply.
    i. General order status (Sec.  1.283(a)(2)(i)). (Comments) One 
comment asks for confirmation that the provisions in title 19 of the 
U.S. Code that apply to unentered merchandise would apply to articles 
of food that have been refused under section 801(m)(1) of the FD&C Act.
    (Response) FDA and CBP generally agree with this comment. However, 
we have concluded that the interim final rule should specify that these 
provisions will apply immediately upon refusal under section 801(m)(1) 
of the FD&C Act because entry of an article of food refused under 
section 801(m)(1) cannot be made for want of proper documents or other 
cause, as described in section 490(a)(1)(C) of the Tariff Act of 1930, 
as amended (19 U.S.C. 1490(a)(1)(C)). Accordingly, Sec.  1.283(a)(2)(i) 
of the interim final rule specifies that an article of food that has 
been refused under section 801(m)(1) of the FD&C Act shall be 
considered general order. Thus, an article of food refused under 
section 801(m)(1) meets the criteria of general order and must be 
handled in accordance with sections 490 and 491 of the Tariff Act (19 
U.S.C. 1490 and 1491) and CBP's implementing regulations at 19 CFR part 
127 except as otherwise specified in 21 CFR part 1, subpart I.
    ii. Locations for holding refused food (Sec.  1.283(a)(2)(ii)).
    (Comment) One comment suggests using the existing system where 
shipments may be held in place at the port for 14 days after which they 
must be moved to general order.
    (Response) After merchandise has arrived in the United States, the 
Customs regulations prescribe a 15-calendar day period during which 
entry must be made. If entry is not made during this time, the 
merchandise then must be sent to general order inasmuch as entry has 
not been completed (see 19 CFR 4.37, 122.50, or 123.10). However, as 
described previously, this 15-calendar day period is not applicable to 
articles refused under section 801(m)(1)

[[Page 59018]]

of the FD&C Act. Articles that are refused for inadequate prior notice 
cannot be entered under any form of Customs entry. Those articles may 
only be entered after adequate prior notice has been given.
    (Comments) Several comments express concern about the impact of 
refusal and holding at the port or secure storage on the quality, 
value, and marketability of perishable fresh and frozen foods.
    (Response) FDA expects that the changes in the interim final rule, 
in particular the shortened timeframes, will mean fewer refusals. In 
addition, since FDA will make every effort to review prior notices for 
refused articles within these same timeframes, those responsible for 
submitting prior notice have the ability to have the refusal removed in 
a matter of a few hours. This, too, significantly reduces the impact of 
the interim final rule on perishables. Finally, FDA also intends to 
provide guidance to its staff on implementing and enforcing the prior 
notice requirements, both during the initial transition period and 
after that period ends.
    FDA agrees that appropriate storage and holding conditions must be 
considered for perishable and frozen foods refused for inadequate prior 
notice. This means that if the article of food arrives in frozen 
condition and has been transported under frozen conditions, the 
facility used for holding the product must provide adequate frozen 
conditions.
    (Comments) Some comments express concern that there are 
insufficient facilities at the U.S./Mexico ports to handle the 
potential refusals during the produce season. One commenter disagrees 
with FDA's statement in the preamble to the proposed rule that ``U.S. 
Customs has identified a well-established network of storage facilities 
that are secure.'' The comment pointed out that there is no 
infrastructure of secure facilities at all ports. A comment noted that 
there are few facilities at remote East and West ports along the U.S./
Canadian border that have temperature controlled environments and are 
available around the clock. Another comment noted that there generally 
is a lack of bonded cold storage facilities at borders and at airports. 
One comment asks for information on the infrastructure of storage 
facilities that would provide sanitation and temperature controls, as 
well as security controls, including security against theft and 
accidents. Some comments ask that FDA publish a list of the secure 
facilities and the costs that FDA authorizes for the refused food.
    (Response) FDA expects that the changes in the interim final rule, 
in particular the shortened timeframes, will mean fewer refusals and 
thus less need for storage for refused articles of food. Nevertheless, 
FDA and CBP agree that the different ranges of storage available at 
different ports need to be addressed. However, this issue needs to be 
addressed in light of the determination, reflected in Sec.  
1.283(a)(2)(i), that food refused under section 801(m)(1) of the FD&C 
Act has ``general order'' status. Under customs laws and regulations, 
general order merchandise must generally be held in a general order 
warehouse (19 CFR 127.1). Customs regulations also empower the port 
director, if merchandise requires specialized storage facilities that 
are unavailable in a bonded facility, to direct the storage of the 
merchandise by the carrier or by any other appropriate means (see 19 
CFR 4.37(f), 122.50(f), or 123.10(f)). Additionally, fruit and other 
perishables may be held by the port director in a bonded cold-storage 
warehouse for a reasonable period, if it is probable that entry will be 
made at an early date (19 CFR 127.28(c)).
    FDA and CBP believe that general order storage qualifies as secure 
facilities for purposes of the Bioterrorism Act, as it is subject to 
the requirements set out at 19 CFR part 19. In particular, 19 CFR 19.9 
contains controls that will ensure that refused food will be adequately 
controlled while in storage and will not be released from general order 
storage without CBP authorization.
    (Comments) Several comments ask for clarification on secure 
facilities. Comments ask whether a general-purpose warehouse in a FTZ 
or a secure facility operated by the importer of record would be 
considered a secure facility under the rule. Another comment suggests 
that a clear chain of custody and fiduciary responsibility is required 
when products are impounded. The comment recommends that appropriate 
and sufficient impound storage facilities must be available before 
enforcement begins.
    (Response) As set out previously, food refused under section 
801(m)(1) of the FD&C Act must be held in accordance with CBP's 
regulations on general order merchandise.
    (Comments) One comment suggests that if there is a failure to 
submit adequate prior notice, the goods should be allowed to move to 
the port of destination.
    (Response) The prior notice is required to be submitted to and 
confirmed by FDA before the article of food arrives at the port of 
arrival. Food refused because of inadequate prior notice must be held 
within the port of entry for the article unless directed by CBP or FDA. 
Thus, refused food may be permitted to move to the port of destination.
    iii. Movement of refused food (Sec.  1.283(a)(2)(iii)). (Comments) 
One comment objects to making the carrier responsible by regulation for 
movement of refused food. One comment suggested that FDA should be 
responsible for movement of refused foods.
    (Response) As set out in the preamble to the proposed rule (68 FR 
5431 to 5432), we do not believe that section 801(m) of the FD&C Act 
mandates that the government take physical control of refused food. 
Rather, it limits the locations where refused food can be held and to 
whom it can be delivered. Accordingly, FDA proposed that the carrier or 
the person who submitted the prior notice arrange for the movement of 
the refused food. FDA has decided to remove this limitation in the 
interim final rule. Since we have removed limitations on who can 
submit, submitters may now be foreign firms that may have difficulty 
arranging to move food from overseas. We have concluded that we should 
not impose any limitations on who may arrange for the movement of 
refused foods. The interim final rule, Sec.  1.283(a)(2)(iii), does 
maintain the requirement that movement of refused food occur under the 
appropriate CBP custodial bond. The interim final rule further provides 
that refused food must be taken directly to the designated facility, 
shall not be entered, and shall not be delivered to any importer, 
owner, or ultimate consignee. Failure to observe these conditions will 
be a violation of the bond and may result in the imposition of 
liquidated damages.
    b. Segregation of refused foods (Sec.  1.283(a)(3)). (Comments) 
Some comments state that FDA should release to the owner or importer 
all of the other food or nonfood items in the shipment that are not 
affected by the inadequate prior notice, in mixed or consolidated 
shipments, if one or more food items has been refused because of 
inadequate prior notice. One comment points out that shipments might 
contain sealed containers of different foods from different sources. 
One comment asks for clarification on how refused products will be 
segregated from products that may continue when the products are on a 
truck or in a rail car. The comment points out that this is a concern 
for less-

[[Page 59019]]

than-truckload (LTL) carriers and small package carriers, who may have 
thousands of overnight or expedited shipments on one trailer. The 
comments express concern that importers and carriers of nonfood items 
and of compliant food items would be unfairly penalized because of a 
noncompliant entry. A comment states that Customs' regulations 
authorize different portions of merchandise imported in a single 
shipment and consigned to a single consignee to be cleared under 
separate consumption entries (19 CFR 141.52). The Customs regulation in 
19 CFR 141.52 also authorizes separate entries for any portions of a 
shipment that will be covered by different types of entry, such as a 
bonded warehouse entry.
    (Response) FDA agrees. In the preamble to the proposed rule, FDA 
recognized that food refused under section 801(m)(1) of the FD&C Act 
may be located in the same container or truck with nonfood items or 
food that is not refused under section 801(m). However, when mixed or 
consolidated imported freight contains refused articles of food that 
must be held, those articles that have been refused must be dealt with 
in a manner that is consistent with the limitations in section 801(m) 
of the FD&C Act. Therefore, FDA has added Sec.  1.283(a)(3) to the 
interim final rule to state that if the article of food that is refused 
is part of a shipment that contains articles that have not been refused 
under section 801(m)(1) of the FD&C Act, the refused article(s) may be 
segregated from the rest of the shipment. This segregation must take 
place within the port of arrival or where the article is held, if 
different and may be supervised by FDA or CBP.
    c. Costs (Sec.  1.283(a)(4)). (Comments) Several comments ask who 
would be responsible for storage and transportation costs. One comment 
notes that the private parties to the importing transaction should be 
liable for storage and transportation costs when food was refused. One 
comment stated that the person submitting prior notice should be 
responsible for these costs. Another comment asks FDA to include a 
provision in the interim final rule that allows carriers to recover 
removal, storage, or dispositions costs from the owner, purchaser, or 
consignee.
    (Response) Inasmuch as articles for which adequate prior notice has 
not been received are considered general order merchandise, the 
expenses of transportation and storage will be the responsibility of 
those parties who are responsible under the general order statutes and 
regulations. FDA has thus decided it is not necessary to include a 
provision in the interim final rule that specifies which private 
parties should be responsible for costs associated with refusal. 
However, we have added Sec.  1.283(a)(4) to the interim final rule to 
clarify that the U.S. Government is not responsible for these costs.
    (Comments) Some comments ask that the regulation establish a damage 
claim system for losses that occur when perishable foods are detained 
for administrative reasons. Some comments suggest that FDA should 
provide compensation for losses, including transportation and storage 
fees, if the agency mistakenly holds imported product because of an 
oversight in the government's processing of a prior notice.
    (Response) FDA disagrees. The interim final rule provides in Sec.  
1.283(a)(4) that neither FDA nor CBP will be responsible for 
transportation, storage, or other expenses resulting from refusal. FDA 
notes that it has never assumed responsibility for expenses associated 
with refusal under the FD&C Act. Any claim against the government 
arising under these activities shall be governed by the Federal Tort 
Claims Act.
    3. Post-refusal submissions and resubmissions (Sec.  1.283(c)). 
(Comment) Comments ask FDA to clarify how inadequate notice could be 
corrected and what steps must be taken to have the product released. 
One comment suggests that the regulation should state that a shipment 
with inadequate prior notice would be held only until the prior notice 
is corrected and that the correction should be required within 24 
hours. One comment suggests that food should be held for 24 hours and 
then deemed released if FDA has not notified the person submitting the 
notice that the food will be examined.
    (Response) FDA agrees that the rule should specify procedures for 
submitting or resubmitting a prior notice after refusal. These are set 
out in Sec.  1.283(c)(i) and (c)(ii) in the interim final rule. FDA 
does not believe it is necessary to impose any limit on how long a 
person has to submit or correct a prior notice for refused foods since 
an article of food refused under section 801(m)(1) of the FD&C Act is 
considered general order merchandise. If no adequate prior notice is 
received within the timeframes set out in 19 CFR part 127, title in the 
refused food will vest in the United States and the refused food will 
be eligible for general order sale or other disposition. Also note that 
fruit, perishables, or merchandise liable to depreciation, may be 
characterized as ``special merchandise'' per 19 CFR 127.28. Alternate 
disposition, consistent with the general order statutes, is then 
provided for.
    The rules governing general order merchandise should be familiar to 
those in the business of importing food, as they are rules of long 
standing that are applied by CBP when no entry is made for food. FDA 
believes that it is up to the persons involved in importing the food 
into the United States to determine how quickly prior notice should be 
submitted or resubmitted for food refused under section 801(m)(1) of 
the FD&C Act.
    FDA does not agree that the refusal should be deemed removed if the 
transmitter does not hear from FDA within 24 hours that FDA will be 
examining the product. Section 801(m)(2)(B)(i) of the FD&C Act states 
that refused food may not be released until prior notice has been 
submitted, reviewed by FDA, and determined by FDA to be adequate.
    (Comments) Many comments state that the regulation should set 
limits on the time FDA has to determine the adequacy of a prior notice 
submitted after a food has been refused in order to ensure quick 
release of refused food. One comment explains that such language would 
be consistent with congressional intent as stated in the Conference 
Report:

if an article of food were offered for import without providing the 
required prior notice, the article of food would be held at the port 
of entry until the Secretary has determined that notice is complete, 
but it would not be held longer than the unelapsed period of prior 
notice unless there is other basis for doing so.

(Conf. Rept. at H2858.)
    (Response) FDA agrees in part. The rule provides in Sec.  
1.283(c)(iii) that once the prior notice or corrections to a prior 
notice have been submitted and confirmed by FDA for review, FDA will 
make every effort to review and respond to the prior notice submission 
within the timeframes set out in Sec.  1.279(a).
    d. Export after refusal (Sec.  1.283(a)(5)). Although export under 
the general order provisions of the title 19 of the U.S. Code was 
discussed in the preamble to the proposed rule (68 FR 5432), the 
proposed rule did not address exportation of food refused under section 
801(m) of the FD&C Act.
    (Comment) One comment asks whether export would be required for 
food refused under section 801(m)(1) of the FD&C Act.
    (Response) Export is not required for an article of food refused 
under section 801(m)(1) of the FD&C Act; it is, however, an option for 
an article of food refused under Sec.  1.283(a) and as permitted under 
CBP's general order

[[Page 59020]]

provisions unless FDA or CBP were to seize or administratively detain 
the food under other authority. We have added Sec.  1.283(a)(5) to the 
interim final rule to make this clear. If an article of food that has 
been refused admission under section 801(m)(1) of the FD&C Act is 
exported, the prior notice should be cancelled within 5 calendar days 
of exportation. FDA and CBP note that any time an article of food 
leaves the country after arriving at the port of arrival, it is 
considered an export for CBP purposes, and the applicable line or entry 
is deleted and, if prior notice was transmitted with the entry via ACS, 
the prior notice will be cancelled as well. This is true regardless of 
whether the intent is to re-import the article, even if the re-import 
occurs after a brief period of time.
    To import that article of food, the prior notice must be re-
submitted, and a new entry must be made, and the new prior notice will 
have the effect of ``restarting the clock'' in terms of when the prior 
notice has been submitted to FDA. If prior notice had been transmitted 
via the FDA Prior Notice System Interface, the prior notice is not 
automatically canceled when the article of food is exported. The only 
way to cancel a prior notice that was transmitted via the FDA Prior 
Notice System Interface is to use that system to explicitly cancel the 
prior notice.
    e. Abandoned merchandise (Sec.  1.283(a)(6)). (Comment) One comment 
states that the regulation should address what happens if refused food 
is not claimed by the owner, purchaser, or consignee.
    (Response) The interim final rule, in Sec.  1.283(a)(6), provides 
that if no prior notice or correction is received in a timely fashion 
or export has not occurred, the food shall be dealt with as set forth 
in CBP regulations relating to be general order merchandise, except 
that it may only be sold for export or destroyed as agreed to by CBP 
and FDA.
5. International Mail (Sec.  1.283(e))
    Although the proposed rule applied to food imported or offered for 
import by mail, see, e.g., 68 FR 5436, there were no proposed 
provisions specific to refusal of food arriving by international mail.
    (Comments) No comments submitted comments specific to refusal of 
food arriving by international mail were submitted.
    (Response) FDA believes that separate refusal procedures are 
necessary for food arriving by mail given differences between mail and 
cargo. FDA believes that these procedures are authorized under section 
701(b) of the FD&C Act because they are necessary to ensure that the 
refusal provisions of section 801(m)(1) of the FD&C Act can be 
efficiently and effectively applied to food that arrives by mail. The 
interim final rule thus provides in Sec.  1.283(e) that in the case of 
food arriving by international mail with inadequate prior notice, the 
parcel will be held by CBP for 72 hours for FDA inspection and 
disposition. If the parcel is refused and there is a return address, 
the article may be returned to sender stamped ``No Prior Notice--FDA 
Refused.'' If there is no return address or FDA determines that the 
articles of food in the shipment appear to present a hazard, FDA may 
dispose of or destroy the parcel at its expense. If FDA does not 
respond within 72 hours of the CBP hold, CBP will return the parcel to 
the sender or, if there is no return address, destroy the parcel, at 
FDA expense.
2. Food Carried by or Otherwise Accompanying an Individual (Sec.  
1.283(b))
    Although the proposed rule applied to food imported or offered for 
import in baggage that was not brought in by a traveler for personal 
use, there were no proposed provisions specific to refusal of food in 
baggage in the proposed rule.
    (Comments) No comments submitted comments specific to refusal of 
food carried by or otherwise accompanying an individual.
    (Response) FDA believes that separate refusal procedures are 
necessary for food carried by or otherwise accompanying an individual 
given differences between these kinds of imports and cargo. FDA 
believes that these separate procedures are authorized under section 
701(b) of the FD&C Act because they are necessary to ensure that the 
refusal provisions of section 801(m)(1) of the FD&C Act can be 
efficiently and effectively applied to food carried by or otherwise 
arriving with an individual.
    (Interim final rule) Section 1.279(f) provides that the individual 
who carries or is accompanied by food must have a copy of the 
confirmation of prior notice when arriving in the United States. 
Section 1.283(b) provides that if there is inadequate prior notice or 
the individual cannot provide FDA or CBP with a copy of the PN 
confirmation, the article of food is subject to refusal. If before 
leaving the port, the individual cannot arrange to have the refused 
food held at the port or exported, the article of food may be 
destroyed.
4. FDA Review After Refusal, Sec.  1.283(d)
    (Comments) Several commenters suggest there should be an efficient 
appeal mechanism in the event that the submitter, importer, owner, or 
consignee believes that food products have been inappropriately refused 
and held.
    (Response) Although such a process is not required by Sec.  801(m) 
of the FD&C Act, FDA agrees that having a review process designed to 
address prior notice issues is warranted. Section 1.283(d) of the 
interim final rule sets out parameters under which a request may be 
submitted to obtain FDA review of whether the article is subject to the 
requirements of this subpart under Sec.  1.276(b)(5) (i.e., meets the 
interim final rule's definition of food) or Sec.  1.277 (i.e., is 
within the scope of the interim final rule) or whether the contents of 
a prior notice submission were accurate. The interim final regulation 
provides that a request must be submitted within 5 days of refusal and 
that FDA will respond within 5 days. FDA notes that if the product is 
perishable, the sooner the request is submitted, the sooner FDA will 
respond. FDA chose these timeframes because they are consistent with 
the timeframes for perishables contemplated under the new 
administrative detention provisions at Sec.  304(h) of the FD&C Act, 21 
U.S.C. 334(h). After review, if FDA determines that the article is not 
subject to prior notice or that the prior notice submission is 
accurate, it will notify the requester, the transmitter, and CBP that 
the food is no longer subject to refusal under section 801(m)(1) of the 
FD&C Act.
5. Prohibition on Delivery Outside of the Port, Sec.  1.283(f)
    (Comments) One commenter suggests following existing procedures and 
allowing refused foods to be held at the importer's place of business, 
quarantined and considered to be undeliverable, but held for sampling 
and release. Another commenter asks for clarification on whether 
product could be shipped to the importer, purchaser, or consignee's 
facility, if prior notice is inadequate.
    (Response) The statute explicitly states that an article of food 
that is refused under the provisions of section 801(m)(1) must be held 
and shall not be delivered to the importer, owner, or consignee. See 
Sec.  801(m)(2)(B)(i). Thus, the provisions of the Bioterrorism Act 
specifically override certain existing procedures that apply when food 
is subject to refusal under Sec.  801(a) of the FD&C Act. In accordance 
with the new procedures specified in the Bioterrorism Act, Sec.  
1.283(de) of the interim final rule provides that, notwithstanding 
Sec.  801(b) of the FD&C Act, 21 U.S.C. 381(b), an

[[Page 59021]]

article of food refused under Sec.  801(m)(1) may not be delivered to 
the importer, owner, or ultimate consignee or transferred by any person 
from the port or secure facility until prior notice is submitted to FDA 
in accordance with this subpart, FDA has examined the prior notice, FDA 
has determined that the prior notice is adequate, and FDA has notified 
CBP and the transmitter that the article of food no longer is subject 
to refusal of admission under Sec.  801(m)(1) of the FD&C Act. After 
this notification, entry may be made in accordance with law and 
regulation.
6. Relationship to Admissibility (Sec.  1.283(g))
    The proposed rule (Sec.  1.278(f)) differentiated between a refusal 
of admission under section 801(m)(1) of the FD&C Act (prior notice) and 
refusal of admission under section 801(a) of the FD&C Act or other U.S. 
laws. The proposed rule clarified that a determination that an article 
of food is no longer subject to refusal of admission under section 
801(m)(1) of the FD&C Act does not mean that it will be admitted to the 
United States under other provisions of the law that apply to 
admissibility determinations.
    (Comments) One comment asks for clarification on whether a shipment 
will have to remain at the port and be subject to inspection until 
after FDA receives and reviews the entry documentation through OASIS. 
The comment points out that in most cases, OASIS review occurs after 
the goods have at least been conditionally released. Other comments 
state FDA should conduct its review under section 801(a) of the FD&C 
Act at the same time it is doing its prior notice review. Another 
comment asks what would happen if a prior notice was determined to be 
inadequate as part of FDA's review under section 801(a) of the FD&C 
Act.
    (Response) Section 1.283(g) provides that FDA's determination that 
an article of food is no longer refused under section 801(m)(1) of the 
FD&C Act is different than, and may come before, determinations of 
admissibility under other provisions of the FD&C Act or other U.S. 
laws. As a general matter, FDA intends to use prior notice information 
to determine what products should be inspected upon arrival; we do not 
intend to make admissibility decisions under section 801(a) of the FD&C 
Act until entry has been made. The refusal under section 801(m)(1) of 
the FD&C Act will be removed after prior notice has been received, 
reviewed, and responded to by FDA, and there will be no further 
requirement to hold at the port for purposes of section 801(m). As a 
general matter, at that point, the procedures under section 801(a) and 
(b) of the FD&C Act would apply. If FDA discovers that prior notice was 
inadequate after an article leaves the port of arrival but before it 
makes a decision to ``may proceed'' or release an article of food under 
section 801(a) of the FD&C Act, FDA may refuse the article under 
section 801(m)(1) and ask CBP to issue a notice of redelivery.
Interim Final Rule (Sec.  1.283)
    FDA revised the proposed rule to provide for more specificity, 
clarify the status of refused food, and provide a mechanism for FDA 
review after refusal. In the interim final rule, FDA identifies the 
consequences and procedures for the following situations:
    a. Inadequate Prior Notice (No, inaccurate, or untimely prior 
notice) (Sec.  1.283(a)(1)). The article is subject to refusal under 
section 801(m) and, if refused, unless immediately exported with CBP 
concurrence, must be held.
    b. Status and movement of refused food (Sec.  1.283(a)(2)). A 
refused article of food shall not be delivered to the importer, owner, 
or ultimate consignee until FDA has examined the prior notice, 
determined the adequacy of the prior notice and notified the 
transmitter and CBP that the article of food covered by the prior 
notice is no longer refused. A refused food is considered general order 
merchandise under section 490 of the Tariff Act of 1939, as amended. 
The refused food must be moved under appropriate custodial bond. FDA 
must be notified of the location where the food has been or will be 
moved within 24 hours of refusal. The food must be taken directly to 
the designated location, shall not be entered, and shall not be 
delivered to any importer, owner, or ultimate consignee.
    c. Segregation (Sec.  1.283(a)(3)). If a refused food is part of a 
shipment that contains other articles, the refused food may be 
segregated from the rest of the shipment within the port of arrival or 
where it is held, if different. FDA or CBP may supervise the 
segregation.
    d. Costs (Sec.  1.283(a)(4)). Neither FDA nor CBP will be liable 
for transportation, storage, or other expenses resulting from refusal.
    e. Post-refusal submissions and resubmissions (Sec.  1.283(c)). If 
an article of food is refused for no or inaccurate prior notice, the 
prior notice must be submitted to and confirmed by FDA for review.
    f. Export after refusal (Sec.  1.283(a)(5). A refused food may be 
exported with CBP concurrence and supervision. If a refused food is 
exported, the prior notice should be cancelled within 5 days of 
exportation.
    g. No post refusal submission or request for review (Sec.  
1.283(a)(6). If no prior notice, correction, or request for FDA review 
is submitted in a timely fashion after an article of food is refused, 
the food will be dealt with as set forth in CBP regulations relating to 
general order merchandise. It may only be sold for export or destroyed 
as agreed to by CBP and FDA.
    h. International mail (Sec.  1.283(e)). In the case of food 
arriving by international mail, if prior notice is inadequate, the 
article will be held by CBP for 72 hours for FDA inspection and 
disposition. If the article of food is refused and there is a return 
address, the parcel may be returned to sender. If there is no return 
address or the article of food in the parcel appears to present a 
hazard, FDA may dispose of or destroy it at FDA's expense. If FDA does 
not respond within 72 hours of the CBP hold, CBP will return the parcel 
back to the sender or, if there is no return address, may destroy the 
parcel at FDA's expense.
    i. Food carried by or otherwise accompanying an individual (Sec.  
1.283(b)). The individual must have a copy of the confirmation when 
entering the United States. If there is inadequate prior notice, the 
article will be refused entry and may be held at the port or exported. 
If arrangements for holding or export cannot be made, the food may be 
destroyed.
    j. FDA review after refusal (Sec.  1.283(d)). After refusal, the 
submitter, importer, owner, or ultimate consignee may submit a written 
request asking FDA to review whether the article is subject to the 
requirements of this subpart under Sec. Sec.  1.276(b)(5) and 1.277, or 
whether the prior notice submission is accurate. The interim final rule 
also sets out procedures and timeframes for this review process.
    k. Prohibition on delivery outside of the port (Sec.  1.283(f)). A 
refused article of food may not be delivered to the importer, owner, or 
ultimate consignee until FDA has examined the prior notice, determined 
the adequacy of the prior notice and notified the transmitter and CBP 
that the article of food covered by the prior notice is no longer 
refused. When food that has been refused under section 801(m)(1) of the 
FD&C Act is held at the port or secure facility, it may not be 
transferred by any person from the port or secure facility until prior 
notice is submitted to FDA in accordance with this subpart, FDA has 
examined the prior notice, FDA has determined that the prior notice is 
adequate, and FDA has notified CBP

[[Page 59022]]

and the transmitter that the article of is food no longer refused.
    l. Relationship to admissibility (Sec.  1.283(g)). A determination 
that an article of food is no longer subject to refusal under section 
801(m)(1) of the FD&C Act is different than, and may come before, 
determinations of admissibility under other provisions of the FD&C Act 
or other U.S. laws. A determination that an article of food is no 
longer subject to refusal under section 801(m)(1) of the FD&C Act does 
not mean that it will be granted admission under other provisions of 
the FD&C Act or other U.S. laws.
6. What Are the Other Consequences of Failing To Submit Adequate Prior 
Notice or Otherwise Failing To Comply With This Subpart? (Sec.  1.284)
    In accordance with section 301(ee) of the FD&C Act, the proposed 
rule (Sec.  1.278(g)) provided that it is a prohibited act to import or 
offer for import an article of food without complying with the 
requirements of section 801(m) of the FD&C Act, or otherwise to violate 
any requirement under section 801(m). In addition, the proposed rule 
provided that the United States can bring a civil action in Federal 
court to enjoin persons who commit prohibited acts and bring a criminal 
action in Federal court to prosecute persons who commit prohibited 
acts. In addition, under 21 U.S.C. 335a, FDA can seek debarment of any 
person who has been convicted of a felony relating to importation of 
food into the United States.
    (Comments) Some comments ask that FDA provide a transition period 
for implementing the regulation, during which a submitter would not be 
prosecuted for providing inadequate or incomplete prior notice.
    (Response) The requirements of the statute do not allow for this 
kind of a transition period. FDA will, however, provide guidance on 
enforcement to its staff containing the agency's policies on 
injunctions, prosecution, and debarment related to failure to provide 
timely and accurate prior notice, as well as the agency's policies 
regarding refusals under section 801(m)(1) of the FD&C Act and holds 
under section 801(l). FDA intends to include a transition period in 
this guidance, during which it will emphasize education to achieve 
compliance. While FDA will nonetheless be authorized to take various 
types of enforcement action for violations of the prior notice 
requirements, this planned transition period will allow FDA to focus 
its resources on the most appropriate circumstances. While this 
transition period is important, FDA also intends to provide guidance to 
its staff on enforcing the prior notice requirements after a transition 
period. These guidance documents will be made available to the public, 
and FDA will publish a notice of availability in the Federal Register.
    This enforcement discretion with regard to refusals of foods under 
801(m) and 801(l) will not impact FDA's ability to take other actions 
that may be necessary, such as conducting inspections for food safety 
and security concerns, determining whether an article of food is 
subject to refusal under section 801(a) of the FD&C Act at the port of 
entry, or taking any other action under the FD&C Act. FDA may consider 
the failure to provide prior notice as a factor in determining whether 
to examine the product at destination. In addition, it will not impact 
upon CBP's ability to assess penalties under 19 U.S.C. 1595a(b) or to 
take enforcement action under any other authority.
    (Interim final rule) Section 1.284 of the interim final rule 
establishes a separate provision to cover the other consequences of 
failing to submit adequate prior notice or otherwise comply with 21 CFR 
part 1, subpart I. The interim final rule provides that the failure of 
a person who imports or offers for import an article of food to submit 
prior notice is a prohibited act under section 301(ee) of the FD&C Act 
(21 U.S.C. 331(ee)). The interim final rule also sets out the civil, 
criminal, and debarment actions that the United States may bring 
against persons who commit a prohibited act.

K. ``What Happens to Food That Is Imported or Offered for Import From 
Unregistered Facilities That Are Required To Register Under 21 CFR Part 
1, Subpart H?'' (Sec.  1.285)

    As set out in the preamble to the interim final rule on 
registration of food facilities under section 415 of the FD&C Act, FDA 
has decided to include in the prior notice interim final rule the 
provisions that address what happens when imports from unregistered 
foreign food facilities arrive at the port. FDA decided this course was 
most appropriate because, in the first instance, we will be using the 
prior notice review process to ensure that foreign food facilities are 
registered. Moreover, FDA believes that the procedures for dealing with 
food from unregistered foreign facilities should be, as they were in 
the proposed registration rule, identical in most respects to the prior 
notice procedures, and thus it makes sense to consolidate them in one 
regulation.
    (Comments) Comments on the registration proposed rule are described 
in the preamble to the interim final registration rule, published 
elsewhere in this issue of the Federal Register.
    (Response) Responses to comments on the registration proposed rule 
are described in the preamble to the interim final registration rule, 
published elsewhere in this issue of the Federal Register.
7. Interim Final Rule (Sec.  1.285)
    FDA revised the proposed rule to provide for more specificity, to 
clarify the status of food under hold, and to provide a mechanism for 
FDA review after a hold is imposed.
    a. Failure to register (Sec.  1.285(a) and (b)). If an article of 
food from a foreign manufacturer that is not registered as required 
under section 415 of the FD&C Act (21 U.S.C. 350d) and 21 CFR part 1, 
subpart H, is imported or offered for import into the United States, 
the food is subject to refusal of admission under section 801(m)(1) of 
the FD&C Act and 21 CFR 1.283(a) for failure to provide adequate prior 
notice. The failure to provide the correct registration number of any 
foreign manufacturer if registration is required under section 415 of 
the FD&C Act and 21 CFR part 1, subpart H, renders the identity of that 
facility incomplete.
    If an article of food from a foreign facility that is not 
registered as required under section 415 of the FD&C Act and 21 CFR 
part 1, subpart H, is imported or offered for import, it is subject to 
a hold within the port of entry for the article unless directed by CBP 
or FDA under section 801(l) of the FD&C Act unless exported.
    b. Status and movement of held food. An article of food under hold 
is considered general order merchandise under section 490(a) of the 
Tariff Act of 1930, as amended. The food must be moved under 
appropriate custodial bond. FDA must be notified of the location where 
the food has been or will be moved within 24 hours of the hold. It must 
be taken directly to the designated facility, shall not be entered, and 
shall not be delivered to any importer, owner, or ultimate consignee.
    c. Segregation (Sec.  1.285(d)). If a food placed on hold is part 
of a shipment that contains other articles, the food may be segregated 
from the rest of the shipment within the port of arrival or where the 
article is held, if different.
    d. Costs (Sec.  1.285(e)). Neither FDA nor CBP will be liable for 
transportation, storage, or other expenses resulting from a hold.
    e. FDA review after hold (Sec.  1.285(j)). After an article of food 
has been placed

[[Page 59023]]

on hold, prior notice submitter, the importer, owner, or ultimate 
consignee may submit a written request asking FDA to review whether the 
foreign facility is subject to the requirements of section 415 of the 
FD&C Act. The interim final rule also sets out procedures and 
timeframes for this review process.
    f. Export after refusal (Sec.  1.285(f)). A food under hold may be 
exported with CBP concurrence and supervision.
    g. No registration or request for review (Sec.  1.285(g)). If no 
registration number is obtained from FDA or no request for FDA review 
is submitted in a timely fashion after a food is placed under hold, the 
food will be dealt with as set forth in CBP regulations relating to 
general order merchandise. It may only be sold for export or destroyed 
as agreed to by CBP and FDA.
    h. International mail (Sec.  1.285(k)). In the case of food 
arriving by international mail, if required registration is lacking, 
the article will be held by CBP for 72 hours for FDA inspection and 
disposition. If the food is held and there is a return address, the 
parcel may be returned to sender. If there is no return address or the 
article of food in the parcel appears to present a hazard, the FDA may 
dispose of or destroy it, at FDA's expense. If FDA does not respond 
within 72 hours of the CBP hold, CBP may return the parcel to the 
sender or, if there is no return address, destroy the parcel at FDA's 
expense.
    i. Food carried by or otherwise accompanying an individual (Sec.  
1.285(h)). If placed on hold, the individual may arrange to have the 
food held at the port or exported. If such arrangements cannot be made, 
the food may be destroyed.
    j. Post-refusal and post-hold submissions (Sec.  1.285(i)). To 
resolve a refusal if an article of food has been refused under Sec.  
1.285(a), the facility must be registered and a registration number 
obtained from FDA. The prior notice must then be submitted in 
accordance with Sec.  1.283(c).
    To resolve the hold if an article of food is held under Sec.  
1.285(b) the foreign facility must be registered and a registration 
number obtained from FDA. FDA must be notified of the applicable 
registration number in writing by mail, express courier, fax, or e-
mail. The notification must provide the name and contact information 
for the person providing the registration information. The location for 
delivering this notification will be listed at http://www.fda.gov--see 
Food Facility Registration. If FDA determines that the food should no 
longer be held, it will notify the person providing the information and 
CBP the food is no longer subject to hold under section 801(l).
    k. Prohibition on delivery outside of the port (Sec.  1.285(l)). An 
article of food under hold may not be delivered to the importer, owner, 
or ultimate consignee or transferred by any person from the port or the 
secure facility until registration is complete and FDA has notified CBP 
that the article of food is no longer under hold.
    l. Relationship to other admissibility provisions (Sec.  1.285(m)). 
A determination that an article of food is no longer subject to hold 
under section 801(l) of the FD&C Act is different than, and may come 
before, determinations of admissibility under other provisions of the 
FD&C Act or other U.S. laws. A determination that an article of food is 
no longer subject to hold under section 801(l) does not mean that it 
will be granted admission under other provisions of the FD&C Act or 
other U.S. laws.

IV. Issuance of an Interim Final Rule and Effective Date; Comments

    We are issuing this rule as an interim final rule, with an 
opportunity for public comment. Although we are seeking comment on this 
interim final rule, it will be in effect on December 12, 2003. Thus, 
its requirements will be in effect and have the force and effect of law 
from that date until they are modified by the issuance of a final rule. 
FDA will, however, provide guidance on enforcement to its staff 
containing the agency's policies on injunctions, prosecution, and 
debarment related to failure to provide timely and accurate prior 
notice, as well as the agency's policies regarding refusals under 
section 801(m)(1) of the FD&C Act and holds under section 801(l). FDA 
intends to include a transition period in this guidance, during which 
it will emphasize education to achieve compliance. While FDA will 
nonetheless be authorized to take various types of enforcement action 
for violations of the prior notice requirements, this planned 
transition period will allow FDA to focus its resources on the most 
appropriate circumstances.
    The comment period on this interim final rule will open today for a 
period of 75 days. Moreover, to ensure that those that comment on this 
interim final rule have had the benefit of our outreach and educational 
efforts and have had experience with the systems, timeframes, and data 
elements, FDA intends to reopen the comment period for an additional 30 
days in March 2004. In addition, this date will coincide with the 
issuance of the plan by FDA and CBP relating to timeframes.
    FDA invites public comment on this interim final rule. The agency 
will consider modifications to this interim final rule based on 
comments made during the comment period. Interested persons may submit 
to the Division of Dockets Management (see ADDRESSES) written or 
electronic comments regarding this interim final rule by [75 days after 
December 12, 2003.]. Two copies of any comments are to be submitted, 
except that individuals may submit one copy. Submit one electronic 
copy. Submit electronic comments to http://www.fda.gov/dockets/ecomments.
    Comments are to be identified with the docket number found in 
brackets in the heading of this document. Received comments may be seen 
in the Division of Dockets Management between 9 a.m. and 4 p.m., Monday 
through Friday.
    As noted, this regulation is effective on December 12, 2003. FDA 
will address comments received and confirm or amend the interim final 
rule in a final rule. The agency, however, will not consider any 
comments that have been previously considered during this rulemaking.

V. Analysis of Economic Impacts

A. Final Regulatory Impact Analysis

    FDA has examined the economic implications of this interim final 
rule as required by Executive Order 12866. Executive Order 12866 
directs agencies to assess all costs and benefits of available 
regulatory alternatives and, when regulation is necessary, to select 
regulatory approaches that maximize net benefits (including potential 
economic, environmental, public health and safety, and other 
advantages; distributive impacts; and equity). Executive Order 12866 
classifies a rule as significant if it meets any one of a number of 
specified conditions, including: Having an annual effect on the economy 
of $100 million, adversely affecting a sector of the economy in a 
material way, adversely affecting competition, or adversely affecting 
jobs. A regulation is also considered a significant regulatory action 
if it raises novel legal or policy issues. FDA has determined that this 
interim final rule is a significant regulatory action as defined by 
Executive Order 12866.
    Comments on the economic analysis of the proposed prior notice rule 
covered several major issues, including: The costs estimated to learn 
the rule, the costs to coordinate prior notice information, the costs 
of filing through a broker, and the costs of delayed arrival (including 
truck time costs and the costs

[[Page 59024]]

for lost value of products). We address all comments relevant to the 
economic analysis in detail as each issue appears in the analysis.
1. Need for Regulation
    Section 307 of the Bioterrorism Act of 2002 requires prior notice 
of all food imported or offered for import into the United States. If 
FDA fails to issue a final regulation by December 12, 2003, section 307 
of the Bioterrorism Act provides for a default minimum period of 
advance notice that is not fewer than 8 hours and not more than 5 days 
before an article of food is imported or offered for import into the 
United States. This regulation is needed to implement the statutory 
provisions.
2. Interim Final Rule Coverage
    Unless excluded, this interim final rule applies to all FDA-
regulated food for human and animal consumption that is imported or 
offered for import into the United States. This includes food that is 
imported for export, food transshipped through the United States to 
another country, and food for use in an FTZ. This interim final rule 
does not apply to food that is imported then exported from the port of 
arrival without leaving the port; meat, poultry, or egg products that 
are under the exclusive jurisdiction of USDA; food carried by or 
otherwise accompanying an individual when entering the United States 
for personal use. For the purpose of this rule, the definition of food 
does not include food contact substances (including food packaging), 
pesticide chemicals, or pesticide chemical residues.
    As required by the Bioterrorism Act, the notification must provide 
the identity of the article, manufacturer, shipper, and grower (if 
known), the FDA Country of Production, the country from which the 
article is shipped, and the anticipated port of arrival. In addition, 
the notification must provide the identity of the person who submits 
and transmits the prior notice, the importer, the owner, the consignee, 
the carrier, the CBP entry identifier, anticipated time and date of 
arrival, anticipated shipment information, and, if the food has been 
refused admission and required to be held, the location where it is 
held.
    For food shipments arriving in the United States through 
international mail, notification of the import must be sent before the 
article is mailed. Only the prior notice information that is relevant 
to that type of shipment must be submitted for articles of food 
arriving by international mail. Notification of mail entries will be 
received only through the FDA PN System Interface. For food carried by 
or otherwise accompanying an individual when entering the United States 
that is not for personal use, such as food for sale that is brought 
into the United States in baggage, prior notice must be submitted 
through the FDA PN System Interface.
    a. Number of establishments affected. Using 2001 fiscal year 
information from OASIS (industry codes 02 through 52, 54, and 70 
through 72), FDA has estimated that there are 77,427 importers and 
consignees who receive imported food shipments. Commenters were 
concerned that this importer number represented only importers of 
edible food products, and not such items as food packaging. These 
commenters concluded that FDA's estimate was too low. OASIS does 
include all importers of food, for both humans and animals, and food-
related items and therefore does not underestimate the number of food 
importers. Also, because food contact substances, including food 
packaging, are excluded from interim final rule coverage, our estimate 
of importers should sufficiently account for food importers that might 
not have been formally captured by the OASIS data.
    Comments also indicated that they wanted an expansion of the 
persons allowed to submit prior notice. The proposed rule had 
restricted the submission of prior notice to U.S. importers or U.S. 
purchasers (or their brokers). For the interim final rule, FDA has 
authorized the submission of prior notice by any person.
    Using information from the OASIS system, FDA has determined that 
there are approximately 100,000 foreign manufacturers/processors of an 
article of food. We assume here that foreign manufacturer/processor 
costs associated with this interim final rule will be spread across the 
supply chain; we therefore do not directly address the distribution of 
costs. We think it probable, however, that most of the ongoing costs of 
this interim final rule will be borne by consumers in the form of 
higher retail food prices.
    i. New and closing importer establishments. In addition to the U.S. 
importers currently operating, in future years some new import 
businesses will open and some existing import businesses will close. 
According to the Small Business Administration, in 2001 about 10 
percent of all businesses were new and 10 percent of all businesses 
closed. These new importers will have to become familiar with the FDA 
prior notice system, and some may need to obtain computer equipment and 
Internet access to comply with prior notice requirements.
    ii. Baseline. FDA considers the baseline for this analysis the 
state of the world before the Bioterrorism Act, and we assume this 
baseline has zero costs and benefits.
    b. Current state of the world. The majority of the information that 
will be required by section 307 of the Bioterrorism Act now is supplied 
at the time of entry by a customs broker or self-filer, and usually is 
submitted electronically. Although importers already must notify CBP of 
entries, the Bioterrorism Act requires notification to FDA before the 
food shipment reaches the U.S. port of arrival. This requirement will 
change the current practice of notifying CBP and then subsequently FDA 
upon arrival (and as long as 15 days past arrival based on the time the 
consumption entry may be filed with CBP).
    OASIS showed that approximately 2.9 million food entry lines were 
imported via sea and air transportation in fiscal year 2002. 
Information on food-importing practices indicates that importers 
bringing food products into the United States by vessel notify CBP and 
FDA before their arrival. Importers using vessels as their mode of 
transport for products can notify CBP well in advance of the actual 
shipping date, but CBP will not certify the entry until 5 days before 
the vessel is expected to dock at a U.S. port. FDA is notified of the 
shipment then, through CBP, as early as 5 days before the vessel's 
arrival at a U.S. port.
    Importers bringing food products in by airplane can notify CBP of 
their intent to import food into the United States no more than 24 
hours before the scheduled flight departure time, but cannot certify 
their cargo manifests with CBP until the airplane has taken off from 
the airport of the exporting country (``wheels-up''). FDA is notified 
after ``wheels up'', once the import entry has been filed and certified 
by CBP. CBP has informed FDA that they receive flight information for 
87.6 percent of the flights at the time of ``wheels up.''
    OASIS showed that around 2.3 million entry lines of food were 
imported into the United States via ground transportation in fiscal 
year 2002. The usual practice today for food brought in by truck or 
train (products coming directly from Canada or Mexico) is not to notify 
CBP until arrival. (Filers can certify their entry data up to 24 hours 
before arrival, but CBP does not give a ``screening response'' to the 
entry until actual arrival.) Even though these importers likely have 
the orders and invoices for these products in advance,

[[Page 59025]]

they do not currently notify CBP until the arrival of the food or 
thereafter.
    The constraints prior notice places on those wishing to import food 
into the United States depend on: When the order for the product is 
placed, the minimum prior notice submission time, and the 
manufacturing/processing or other location where the product to be 
imported is held before importing into the United States. A longer 
prior notice submission time would change more business practices for 
food operations nearer to the U.S. border than for those farther away 
from the United States. For example, an 8-hour prior notice minimum 
timeframe will not significantly affect most food shipments imported 
from China, because they are likely to come by sea or by air and the 
length of the journey by either mode of transportation is longer than 8 
hours. If the food to be imported is instead located in Mexico or 
Canada, and the prior notice submission timeframe is 8 hours, there is 
a greater likelihood that the food is located less than 8 hours driving 
time from the U.S. border, and transporting some shipments to the U.S. 
buyer of the product within a specified time would be much more 
difficult. Whereas there is no expectation that a product ordered from 
China will arrive in the United States in 8 hours, in the case of some 
products from Mexico or Canada, normal business practices do include 
the expectation of a quick or rushed delivery to a U.S. destination; 
this expectation may not be met for some prescribed minimum prior 
notice submission timeframes.
    Given the standard importing business practices described in the 
previous paragraphs, and given the restraints that prior notice places 
on food importers using land transportation (and in some cases air 
transportation), we classify options for this analysis by minimum prior 
notice time based on costs for those shipments of imported food that 
arrive in the United States by ground and, in longer minimum submission 
time options, by air transportation as well. Therefore, while we 
include food shipments imported by vessel in the learning, 
coordinating, and submitting costs of each option considered, we do not 
calculate a lost product value or waiting time for products arriving by 
vessel because they are not constrained by the minimum prior notice 
timeframes considered in any of the options. Highly perishable food 
products are generally not imported to the United States by sea.
3. Regulatory Options Considered
    Comments on the estimates used in the analysis of the proposed rule 
indicated that FDA should reexamine the following factors: (1) The time 
it takes to learn about the prior notice rule; (2) the time it takes to 
coordinate information for prior notice submission; (3) the number of 
entries expected yearly; (4) the lost value for perishable products; 
(5) the cost of carrier waiting time; and (6) the costs to current 
BRASS users. These comments have led FDA to assess additional options, 
and revise the estimated costs for other options.
    We analyzed 12 options for a prior notice regulation. Each option 
covers all food subject to the interim final rule that is imported to 
the United States; the mode of transportation for the food is 
specifically addressed in options where minimum prior notice time 
constrains importation:
    Option 1. Current state of the world, pre-Bioterrorism Act 
(baseline).
    Option 2. Prior notice time of 1 hour (constrained by shipments 
arriving by land modes of transport); electronic submission of 
information. This option would require the persons responsible for all 
food imported or offered for import into the United States to notify 
FDA of their intent to import articles of food through an importer, 
customs broker, purchaser, or other agent. This option applies to all 
imported foods subject to the interim final rule. Submission of prior 
notice information must be electronic. Any change in prior notice 
information requires resubmission of corrected or new information.
    Option 3. Require all components of option 2, but lengthen the 
minimum prior notice time to 2 hours (constrained by shipments arriving 
by land transportation modes).
    Option 4. Require all components of option 2, but lengthen the 
minimum prior notice time to 4 hours (constrained by shipments arriving 
by air and land modes of transport); electronic submission of 
information.
    Option 5. Require all components of option 2, including a 1-hour 
minimum prior notice time for vehicles, but lengthen the minimum prior 
notice time to 4 hours for articles of food arriving by train and by 
air, and 8 hours for articles of food arriving by vessel; electronic 
submission of information.
    Option 6. Require all components of option 2, but lengthen the 
minimum prior notice time to 2 hours for articles of food arriving by 
vehicle, 4 hours for articles of food arriving by train and by air, and 
8 hours for articles of food arriving by vessel; electronic submission 
of information (interim final rule).
    Option 7. Require all components of option 4, but allow some prior 
notice information to be revised 1 hour before arrival at a U.S. port.
    Option 8. Require all components of option 2, but lengthen the 
minimum prior notice time to 8 hours (statutory self-executing 
provision).
    Option 9. Require all components of option 7, but allow some prior 
notice information to be revised 1 hour before arrival at a U.S. port.
    Option 10. Require all components of option 2, but lengthen the 
prior notice time to 12 noon of the calendar day before crossing the 
U.S. border.
    Option 11. Require all components of option 9, but allow some prior 
notice information to be revised 1 hour before arrival at a U.S. port.
    Option 12. Require all components of option 9, but allow some prior 
notice information to be revised 2 hours before arrival at a U.S. port 
(proposed rule).
    a. Option 1: Current state of the world, pre-Bioterrorism Act. 
Having no prior notice requirements is option 1 in our analysis. The 
Bioterrorism Act requires that FDA issue prior notice regulations or 
default times take effect, so this option is not legally viable. The 
OMB cost-benefit analysis guidelines recommend discussing statutory 
requirements that affect the selection of regulatory approaches. These 
guidelines also recommend analyzing the opportunity cost of legal 
constraints that prevent the selection of the regulatory action that 
best satisfies the philosophy and principles of Executive Order 12866. 
This option will serve as the baseline against which other options will 
be measured for assessing costs and benefits.
    b. Option 2: Minimum prior notice timeframe of 1 hour; electronic 
submission of information; any change in information requires 
resubmission--i. Costs--(1) Learning costs. The party responsible for 
submitting prior notice to FDA will incur administrative and 
notification costs to comply with this regulation. The responsible 
party likely will become aware of the prior notice requirement through 
normal business activities: reading the trade press, reading industry 
news, FDA outreach, trade outreach, or conversations with other 
business operators who also must comply with prior notice. Once the 
submitter of the information becomes aware of the regulation, he or she 
will need to learn the requirements of the regulation, which will 
require finding a copy of the prior notice requirements and reading and 
understanding them.
    In response to comments received, FDA has re-estimated the costs of 
learning about the prior notice regulation. Comments said that the FDA 
underestimated the learning costs in the

[[Page 59026]]

proposed rule, because of the large change in business practices. 
According to the comments, the importer, depending upon its size, will 
have at least two trained filers for CBP and FDA-related entries. 
Commenters also stated that it is quite likely that an entire brokerage 
staff, including supervisors, will need to understand the FDA prior 
notice system.
    Some comments suggested that the estimated 1 and 2 hour learning 
time for the rule would in fact be an all day training event. Comments 
recalled having a daylong seminar to learn about OASIS when it was 
introduced. In response to the information these comments submitted, in 
this final analysis, FDA assumes that one manager and two subordinates 
from each importing business will attend an 8-hour training session on 
the prior notice regulation.
    FDA used wage rates from the Bureau of Labor Statistics National 
Compensation Survey (Ref. 3), doubled to include overhead costs, to 
estimate the cost of the time to learn the prior notice requirement. 
For an administrative worker, the cost per hour is $25.10: for a 
manager, $56.74. FDA assumes that two administrative workers and one 
manager will be trained for 8 hours each on the prior notice 
requirements. As shown in table 1B of this document, total costs of 
this learning activity are about $66 million for the first year.
    Given the 10 percent turnover in business reported by the Small 
Business Administration, FDA expects 10 percent of the total search 
costs to be incurred in each subsequent year after prior notice is in 
effect as new firms enter the industry. This cost is also shown in 
table 1B of this document.

      Table 1B.--Cost To Learn About the Prior Notice Requirements
------------------------------------------------------------------------
                                                          Administrative
                                          Manager cost     worker cost
                                                          (two workers)
------------------------------------------------------------------------
Number of firms.......................           77,427           77,427
Wage rate per hour for manager and               $56.74           $25.10
 administrator Worker (including
 overhead)............................
1-day learning seminar................              * 8              * 8
First year one time learning costs....      $35,145,664      $31,094,684
Total first year learning costs.......  ...............      $66,240,000
Annual learning costs for new entrants  ...............      $6,624,000
------------------------------------------------------------------------
* Hours.

    (2) Computer acquisition costs. Both the Produce Marketing 
Association (PMA) and the National Food Processors Association (NFPA) 
submitted comments to FDA before FDA published the proposed rule that 
indicated that about 96 percent of the food industry has readily 
available Internet access. The American Feed Industry Association, 
which represents animal food manufacturers, also agreed with NFPA's 
estimate that 96 percent of the food industry has electronic 
transmitting capacity.
    Since all prior notices must be submitted electronically, we 
estimate that there are 3,097 responsible parties without Internet 
access (4 percent of the 77,427 importers). These persons will have to 
purchase a computer and gain Internet access to transmit the 
information via a prior notice screen. This one-time computer cost and 
a recurring Internet access cost for these facilities are shown in 
table 2 of this document.
    Again, given a 10 percent turnover rate for businesses in the 
import industry, we expect there to be new businesses in the future 
that may need to purchase electronic transmitting capabilities. With 
the passage of time, persons will likely purchase this computer 
equipment in the ordinary course of business, not solely to comply with 
prior notice. We include an estimate of this cost for new entrants to 
ensure that we do not underestimate the costs of electronic 
transmitting capacity.
    A few comments indicated that they did not agree with the estimated 
cost for Internet access; they stated that the cost would be higher. 
Since FDA will be receiving most prior notices through ABI/ACS, which 
is an electronic submission system, and since the FDA PN System 
Interface will be used for mail and other non-ABI/ACS transmissions and 
is Web-based, FDA does not agree that Internet access rates should be 
estimated at a higher rate.

  Table 2.--Facilities and Responsible Parties Without Initial Internet
                                 Access
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Number of facilities....................................           3,097
Computer equipment cost per facility....................          $2,000
Annual cost of Internet access ($20 per month x 12).....            $240
Search costs for equipment and access ($25.10 x 8 hours)            $201
Total First Year One Time Cost of Electronic                  $7,559,777
 Transmitting Capacity..................................
Annual one time cost of electronic transmitting capacity        $755,978
 for firms entering industry in subsequent years........
------------------------------------------------------------------------

    (3) Annual costs to submit prior notice entry lines. FDA used OASIS 
information to determine that about 5.2 million entry lines of food 
were imported into the United States in fiscal year 2002, including 
formal mail and express carrier (e.g., Federal Express) entries. An 
``entry line'' is an FDA term used by OASIS, which refers to a line on 
an invoice that reflects a certain article specific to manufacturer/
processor or packaging: e.g., 100 cases containing 48, 6-oz cans of 
tuna.
    Comments on the proposed rule were concerned that the FDA fiscal 
year 2001 OASIS entry line estimate (4.7 million lines) was too low. 
Some comments said that not all the food categories that will need to 
submit prior notice were included in the count; other comments said 
that the prior notice requirement would, because of the information 
required, increase the number of lines per entry by a significant 
amount.
    According to FDA OASIS codes, all formal entries for human and 
animal food were included in the OASIS line count. This count included 
all food contact substances, including the bulk chemicals and polymers 
used to

[[Page 59027]]

produce food-packaging material. The OASIS line count also included the 
codes for beer and wine, but not distilled spirits (e.g., bourbon, 
whiskey, gin, etc.).
    The OASIS entry line totals do not include informal entries for 
mail or express carrier shipments, or for food brought into the United 
States as personal baggage, not for personal use, but intended for sale 
or other distribution use. Persons bringing food into the United States 
by these means, however, are required to submit prior notice to the 
FDA. Therefore, even though food contact substances, including food 
packaging, pesticide chemicals, and pesticide chemical residues are no 
longer subject to the interim final rule, we do not reduce the estimate 
of imported food entry lines in order to capture informal food lines 
and other imported food items that are not currently included in the 
OASIS line estimates. Rather than adjust the total line estimate 
downward to account for the exclusion of food packaging, pesticide 
chemicals, and pesticide chemical residues we adjust the estimate of 
lines upwards to capture food lines not in OASIS. The upward adjustment 
should be regarded as net of food contact substances and food 
packaging.
    For the prior notice interim final rule, then, FDA has re-estimated 
the number of entry lines expected to be filed yearly for prior notice. 
The FDA PN System Interface and ABI/ACS are estimated to handle up to 
25,000 prior notice submissions on a usual business day, for a 
projected yearly total of 6.5 million submissions. (FDA's prior notice 
system will operate 24 hours a day, 7 days a week; however, since most 
shipments enter the United States during a normal business work week, 
Monday through Friday, we estimate the projected prior notice line 
total as 25,000 daily submissions x 260 days = 6.5 million lines per 
year.) This updated total includes estimates for informal and other 
entries not currently captured by OASIS.
    According to OASIS data, the average import entry contains 2.6 
lines, which means that there are typically more than two different 
articles of food per import entry: e.g., 100 cases of canned tuna and 
50 cases of canned peaches in the same shipment. A prior notice must be 
filed for each of the lines in an entry.
    FDA estimates that it will take, on average, 1 hour to submit an 
import entry of 2.6 lines. This time is an average; some entries will 
take longer than 1 hour to complete and other entries will take less 
than 1 hour to complete.
    This 1-hour estimate includes 45 minutes of an administrative 
worker's time to gather information to initially complete the prior 
notice, and then 15 minutes of a manager's time to verify that the 
information is correct. Assuming that there is an average of 2.6 lines 
per entry, and each line requires a prior notice, then each line 
actually takes about 23 minutes to complete.
    Comments on the prior notice proposed rule agreed with the FDA 
estimation for time to fill out the notice. Comments also agreed that 
once prior notice submitters were familiar with the information 
required, an hour was a reasonable time estimate. Some comments, 
however, suggested that the time to make amendments and updates to the 
prior notice had not been included or was not sufficient in the 
proposed rule. FDA believes the 1 hour estimate is appropriate for the 
following reasons: (1) The interim final rule does not contain update 
or amendment provisions as the reduced time for submitting a prior 
notice negated the need for them; (2) CBP Form 3461, (the entry 
document upon which information is provided to CBP) carries an 
estimated burden of 15.5 minutes and FDA Importer Entry Notice (as 
required by section 801 of the FD&C Act) carries an estimated burden of 
8.5 minutes (Paperwork Reduction Act estimates); and (3) many comments 
agree with the hour estimate for submitting prior notice (23 minutes 
per line).
    Comments were also concerned that FDA had not included costs to 
have a licensed customs broker file prior notice submissions in the 
costs estimated for the proposed rule. FDA specifically made no 
assumptions in its analysis of the proposed rule about who would file 
the prior notice. Our estimate covered anyone who was authorized to 
file a prior notice based on the anticipated number of entry lines. The 
analysis implicitly assumed that if an importer, owner, or consignee 
hired a customs broker to submit their prior notices, the broker would 
do so at the marginal cost. In the competitive market for broker 
services, this assumption is reasonable.
    However, FDA prior notice may now be submitted through ABI/ACS for 
most importations, so the burden of prior notice submission will most 
likely be on the customs brokers that normally file with CBP. Some 
comments said that the current customs broker cost to file an entry 
with CBP is $110, with the additional filing of prior notice increasing 
these costs by up to 70 percent. Other comments also indicated that the 
additional costs to file prior notice would be between $50 or $100 or 
more for an entry.
    Based on comments and FDA's own research on the broker costs, FDA 
agrees that the average costs to submit prior notice will be higher 
than the $33 per entry estimated in the proposed rule. For this interim 
final rule, FDA used information provided by commenters to estimate $75 
as the cost to file prior notice. FDA believes that using a midrange 
estimate is appropriate for this cost since filing prior notice through 
ABI/ACS should efficiently combine transactions costs for brokers 
submitting information to both CBP and FDA.
    Using the OASIS data indicating that the average imported entry 
contains 2.6 lines, we can then divide the expected yearly 6.5 million 
total lines by 2.6, which results in 2.5 million expected import 
entries. Table 3 of this document shows that the annual cost of prior 
notice submissions based on 2.5 million entries will be about $187.5 
million.

     Table 3.--Cost To Fill Out Prior Notice Screens by Import Entry
                          [Must Be Electronic]
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Broker cost per entry to submit prior notice...........              $75
OASIS entry total based on 6.5 million lines...........        2,500,000
Total Annual Costs (of all prior notice screens based       $187,500,000
 on 2.6 lines per entry, including updates and
 amendments to the information)........................
------------------------------------------------------------------------

    (4) Information coordination costs. As previously stated, FDA 
received numerous comments on the time it takes to file a prior notice 
for each line, with some comments agreeing that an entry will take an 
hour to complete once firms learn how to submit the information. 
However, comments were concerned that the preparation cost to 
coordinate the information needed for each prior notice had not been 
calculated.

[[Page 59028]]

    In particular, comments said that firms will need to teach their 
suppliers, manufacturers/processors, customers, drivers, warehouses, 
growers, carriers, and shippers about the prior notice requirements 
regardless of whether each of the parties has filing responsibilities. 
FDA agrees. This new collection will necessitate some additional 
coordination of information among the parties involved in importing the 
article of food into the United States.
    FDA assumes it takes about 2 business days (16 hours) for an 
administrative employee of the prior notice-submitting firm to 
coordinate with others to set up the new business practices required to 
receive the information needed for prior notice. We assume this set-up 
time will be sufficient to coordinate information for existing 
importing accounts. Table 4 of this document reports the costs of this 
information gathering and coordinating activity.
    Because we expect some importing firms to enter and leave the 
industry every year, so do we expect importing firms to experience a 
turnover rate for their import accounts. FDA assumes that the turnover 
rate on these types of accounts is similar to the entry and exit rate 
of firms. We therefore assume that 10 percent of the firms' accounts 
each year are new accounts for which prior notice coordination of 
information is needed. This cost is also presented in table 4 of this 
document.

    Table 4.--Information Gathering and Coordination for Prior Notice
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Number of firms submitting notices......................          77,427
Administrative worker wage rate (doubled to include               $25.10
 overhead)..............................................
Time to coordinate existing accounts....................        16 hours
First year cost of coordination of information on            $31,094,683
 current accounts.......................................
Annual cost of coordination of information on new             $3,109,468
 accounts...............................................
------------------------------------------------------------------------

    ii. FDA costs. Information Technology. We assume that FDA's 
information technology (IT) costs for this option and each option 
hereafter are the costs of interfacing with ABI/ACS to receive prior 
notice through OASIS for most FDA-regulated food subject to this 
interim final rule. FDA is developing an FDA PN System Interface to 
receive prior notice information for import entries that cannot be 
accommodated through ABI/ACS, mainly mail and baggage entries, and 
prior notices for food refused under section 801(m) of the FD&C Act.
    FDA has allocated $12.5 million for the development of the FDA 
prior notice system for fiscal year 2003. This total is broken down 
into $7,400,000 for infrastructure design, procurement, setup, 
operations, and maintenance of computer system hardware and system and 
database software and licensing, plus $5,100,000 for contractor 
services for the design, development, testing, and implementation of 
the FDA PN System Interface and the extensive enhancements required by 
OASIS to support prior notice. These costs are summarized in table 5 of 
this document. Also included in table 5 are the costs CBP has incurred 
to accommodate prior notice. CBP costs include modifying ABI/ACS, 
training, and outreach.
    In the next few years, CBP plans to have its new system, ACE 
(Automated Commercial Environment), operational. The ACE system will 
replace the current ABI/ACS as well as combine other CBP entry 
functions and transactions. Prior Notice submission will be compatible 
with ACE. It is quite likely that importers will benefit from the 
enhanced functions of the new ACE system.

                 Table 5.--FDA Prior Notice System Costs
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Infrastructure design and implementation................      $7,400,000
Contractor services.....................................      $5,100,000
FDA system interface costs..............................     $12,500,000
CBP ABI/ACS system modification costs...................        $500,000
Total prior notice system costs.........................     $13,000,000
------------------------------------------------------------------------

    Human Resources. The implementation of prior notice does not 
specifically call for the hiring of additional FDA border or 
inspectional staff. However, even before the passage of the 
Bioterrorism Act, FDA hired 300 additional consumer safety officers to 
help with the inspection of articles of food. And with the 
implementation of the prior notice interim final rule, it is quite 
likely that FDA will need to concentrate even more of its human 
resources on enforcement activities. Currently, FDA is working on a 
memorandum of understanding with CBP that would allow FDA to commission 
CBP's help as needed for inspections and enforcement activities related 
to the prior notice rule.
    Destruction of Foods. FDA will be responsible for the destruction 
of articles of food that come into the United States via international 
mail and whose prior notices are considered inadequate or refused. FDA 
does not have an estimate of these destruction costs. We expect these 
destruction costs to be minimal, however, based on the fact that these 
will be personal food shipments and that there were relatively few 
formal mail entries (38,000) for articles of food in the OASIS data for 
fiscal year 2002.
    iii. Current operating practices affected--(1) Food importers 
currently using BRASS. In response to comments, FDA and CBP have agreed 
to allow prior notice information to be filed through ABI/ACS for most 
articles of food. By allowing prior notice to be submitted through ABI/
ACS, FDA has eliminated the duplicative information collection that 
would have resulted from the proposed stand-alone FDA Web-based system. 
While combining agency efforts has eliminated duplicative submission of 
information for many food importers, the combined system will increase 
submission requirements for those food importers who use BRASS.
    BRASS is a CBP program that allows expedited arrival processing for 
high-volume, repetitive shipments that have been judged by CBP to be 
low risk. BRASS processing is not compatible with the electronic 
submission of prior notice information because entry information for 
BRASS shipments is not filed until entry summary, long after the food 
has crossed the border. Therefore, those food importers who currently 
use BRASS and its expedited arrival process

[[Page 59029]]

will no longer be able to do so once prior notice submission is 
required.
    Currently, importers who qualify to use BRASS show paperwork at the 
border. These importers then only have to submit an entry summary after 
arrival (up to 10 business days later). In contrast, non-BRASS 
importers must submit an entry and a later entry summary. Since prior 
notice is required before arrival, importers of FDA-regulated products 
will no longer be able to submit information to CBP using BRASS; they 
must submit both the entry information (which includes prior notice 
requirements) and then a later entry summary to CBP.
    Data from CBP show that about 630,000 entry lines were submitted 
through BRASS for FDA-regulated products, including foods, in fiscal 
year 2002. We use this information to estimate the increased submission 
costs for these importers once they are no longer able to use BRASS to 
expedite entry of their products. Increased submission costs come in 
the form of having to make two submissions through CBP instead of the 
one summary entry after arrival in the United States. We calculated the 
cost of the one additional transmission of information, now required 
due to the prior notice information that is needed before arrival, in 
table 3 of this document. By using these same costs per import entry 
($75), we can account for the extra costs for BRASS users. Table 6 
shows that the extra submission of information by importers no longer 
able to use BRASS will be about $18 million per year.
    Being able to use BRASS not only allows the condensing of the 
submission of required import information, but also allows the 
importer's carrier or transporter to spend less time crossing the 
border. BRASS users must stop at the border only long enough for a CBP 
official to ``wand'' the barcode information pertaining to their 
shipments and assign a CBP entry number to the shipment. Once food 
importers are no longer able to use BRASS, however, they must not only 
submit more information on the shipment than was previously required at 
arrival, but they also will no longer be able to cross the border as 
quickly. Because former BRASS entries will no longer be able to get 
through the border checkpoints as easily as they used to, we include 
here the cost of an extra half-hour of truck time per BRASS entry.
    Using one comment's estimate of the cost of truck time, $250 per 
hour, we can calculate the yearly additional cost of wait time at the 
border for food importers who were former BRASS users. Table 6 of this 
document shows the cost of the additional truck time for BRASS users to 
be about $30 million annually.

               Table 6.--Additional Costs for BRASS Users
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Additional Submission Costs:
    Total cost per import entry.........................             $75
    FY 2002 BRASS line total for FDA-regulated products.         630,000
    BRASS yearly entry total (2.6 lines per entry)......         242,308
    Additional annual costs of submissions for BRASS         $18,173,100
     users..............................................
Additional border wait time:
    Cost per half hour..................................            $125
    BRASS yearly entry total (2.6 lines per entry)......         242,308
    Additional annual border wait costs for former BRASS     $30,288,500
     users..............................................
    Total annual additional food importing costs for         $48,462,000
     BRASS users........................................
------------------------------------------------------------------------

    (2) Loss of value for highly perishable products. A 1-hour minimum 
prior notice requirement would be less likely to change current food 
importing practices than would a longer minimum time requirement for 
prior notice submission. Pre-proposal comments received from Canadian 
and Mexican perishable seafood processors and produce growers indicated 
they would prefer the minimum prior notice time to be set at 4 hours or 
less. The seafood processors and produce growers asked for the shorter 
minimum prior notice time because the source of these food products 
often is close to the U.S. border, and the products are perishable.
    For example, Canadian fruit and vegetable producers said that such 
products as ``leafy vegetables, green onions, cabbage, cauliflower, new 
potatoes, sweet cherries, and berries are harvested within hours of 
arrival at the U.S. border and cannot withstand delays, especially 
during the extreme heat of summer and early fall when the products are 
in season.'' As another example, a produce company from Mexico 
commented that growers typically harvest produce in the morning, pack 
and cool the fruit in the afternoon, and then start the drive to the 
U.S. border during evening hours. Some, but not all, of the border 
ports are open in the evenings during the height of the Mexican produce 
season. If notice to FDA is required by 12 noon the calendar day before 
arrival at the border, as FDA proposed, it is unlikely that these 
produce products could be harvested in the morning in Mexico and then 
enter the United States by the same evening, because not all the 
information would be prepared in time to meet the submission deadline 
in the proposed rule, which was 12 noon the day before arrival in the 
United States.
    Canadian seafood industry comments said that 90 percent of all 
fresh seafood sales are same day orders that are processed, sold, and 
shipped in the same day. They also commented that if buyers were 
required to submit seafood orders early (by 12 noon on the calendar day 
before arrival) because of prior notice requirements, they would tend 
to order short, rather than risk being left with a decomposing 
inventory. Comments also said that many perishable seafood contracts 
with shippers call for a variety of species to be delivered depending 
on what could be harvested that day; thus, species and the specific 
amount of fish in an import entry will be uncertain for longer prior 
notice timeframes.
    From these comments, it is clear that at least in some industries, 
when the order for the shipment is received, when the prior notice is 
submitted, when the shipment is loaded, and the loaded shipment's 
location relative to a U.S. border all play roles in determining how 
the requirement for prior notice will affect current business operating 
practices.
    FDA expects that there will be some imported shipments by vehicle 
for which the order was received just before the shipping time, some 
shipments for which the composition of the product has changed since 
the time when the prior notice was submitted, and some shipments for 
which other changes to the information on the prior notice must be 
made. Importers whose shipments fall into this ``changed'' category 
must

[[Page 59030]]

resubmit the prior notice or risk that their products will be refused 
admission into the United States and held if the notice is deemed 
inadequate.
    FDA does not have information on the number of shipments that, 
under this option, would need to submit or resubmit prior notice 
information due to a late order or a change in the information provided 
on the original notice. We know that changes will occur for some 
percentage of all prior notices; comments did not indicate the 
percentage of notices that would have to be resubmitted.
    Depending on the U.S. entry point, however, comments FDA received 
before publishing the proposal indicated that between 40 and 100 
percent of shipments from Canada and Mexico are loaded less than 4 
hours before arrival. Therefore FDA believes that it is this subset of 
importers, importing perishable products not far from the U.S. border, 
that will be most concerned with the prior notice submission timeframe. 
Based on this information, FDA bases its prior notice resubmission 
percentage rates and prior notice arrival time on the 4 hours required 
under option 4.
    Option 4 is to have prior notice be required 4 hours before 
arrival, with the resubmission rate at 20 percent; one-half the 
comments' lower bound estimate of 40 percent. By using option 4 as the 
base option, we can then estimate resubmission rates for prior notice 
arrival times that are less than 4 hours. We assume, then, that for 
each hour reduction in required prior notice arrival time, the 
resubmission rate for importers of perishable produce and seafood 
(based on their location to the border and order placement) is cut in 
half. Thus, for a 3 hour prior notice timeframe, we assume the 
resubmission rate for notices will be 10 percent, for a 2 hour prior 
notice timeframe the resubmission rate for notices will be 5 percent, 
and for a 1 hour prior notice timeframe (this option) the resubmission 
rate for notices is 2.5 percent.
    (3) Loss of value for perishables. The following paragraphs and 
tables outline how FDA calculated a loss in product value to account 
for the time that perishable produce and seafood from Canada and Mexico 
might have to wait to cross the border due to prior notice 
resubmission. This wait occurs if prior notice needs to be submitted or 
canceled and resubmitted due to shipment changes when the shipment is 
closer to the border than the 1 hour required; the transporter of the 
shipment must wait for the minimum prior notice time to elapse before 
crossing the border or risk being denied entry.
    Comments from Canadian and Mexican perishable seafood and produce 
producers indicated that the mode of transport that causes the most 
concern for delays are shipments arriving in the United States by 
truck. Some comments, however, indicated that some perishable products 
might arrive via air transportation, and that air flights from Latin 
America and even potentially some countries in Europe could take less 
than 8 hours and in some cases less than 4 hours.
    FDA has examined flight times to the countries suggested by 
comments. FDA does not believe that articles of food arriving in the 
United States on flights from South America or from Europe will be 
delayed by the prior notice requirement. However, FDA does believe that 
perishable products being flown in from Central America might 
experience some delay, and therefore lost product value, as a result of 
prior notice. We will begin to include the products from these 
countries in option 4, minimum prior notice time of 4 hours.
    Information on perishable produce and seafood from Canada and 
Mexico used in this analysis represents yearly shipments of each 
product regardless of mode of transport. We assume most of these 
shipments arrive in the United States by truck or other ground 
transportation, given the proximity of Mexican and Canadian processors 
to the border, but it is possible that some shipments by air and sea 
are included in this count. These yearly all-inclusive totals should 
therefore be sufficient to account for any delay in time that importers 
of food shipments from Canada and Mexico may experience.
    Table 7 of this document shows the volume of fresh, perishable 
produce imported into the United States from Mexico for the calendar 
year 2001 (Ref. 4). Produce was included in the count if it was 
considered `highly or very highly perishable' (Ref. 5) and if the 
produce was not regulated under section 8e of the Agricultural 
Marketing Agreement Act of 1937 (AMAA). Products currently regulated by 
the AMAA (including, tomatoes, avocadoes, oranges, dates, hazelnuts, 
grapefruit, table grapes, kiwi fruit, limes, most olives, onions, Irish 
potatoes, plums, prunes, raisins, and walnuts), are required to notify 
USDA at least 1 day before arrival to make arrangements for inspection 
and certification of the product they are importing. These products 
therefore are not included in the count because they already have 
business practices in place that would accommodate the prior notice 
requirements provided in this option.
    Several comments wanted products under the AMAA and products that 
are somewhat less perishable to be included in the perishability loss 
of value calculation. FDA has decided not to include these products in 
the lost value calculation; products under the AMAA already have 
operating practices in place to ensure they provide notice before 
arrival and those products that are less than highly perishable, such 
as potatoes, are not going to lose value because of the prior notice 
times presented in these options. FDA will expand its analysis to 
include the cost of additional truck time for longer submission times 
for all products being imported into the United States. FDA agrees with 
the comments that stated that the cost of truck time from a delay at 
the border is a real cost regardless of a product's perishability.
    Multiplying the volume of Mexican produce that was imported into 
the United States in 2001 by the current U.S. border prices per pound 
(Ref. 6) for these products gives an estimate of wholesale revenue. 
Then we convert the wholesale revenue to retail revenue using the 
retail price mark-up on produce in the United States. We will increase 
the wholesale revenue by 100 percent in these estimates to represent a 
reasonable retail price mark-up rate across produce commodities in the 
United States (Ref. 7). Some comments did not agree with FDA's 
calculation of the spread between wholesale and retail prices for 
perishable products. We reexamine our choice of the 100 percent mark-up 
rate in a sensitivity analysis presented later in the costs section.

BILLING CODE 4160-01-P

[[Page 59031]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.075

    We repeat the exercise outlined above in table 7 of this document 
for Canada, as shown in table 8 of this document. For these 
calculations we assume that Canadian produce growers use business 
practices that are similar to those used by Mexican growers; FDA did 
not receive any comments to the contrary. As with the Mexican produce, 
only Canadian produce that is highly or very highly perishable and did 
not fall under the purview of the AMAA is included in table 8 of this 
document.

[[Page 59032]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.076

    Assuming that perishable produce has an average life span of 7 
days, we estimate the value of the time lost (1 hour) for 2.5 percent 
of the imports waiting to cross the border as a less than 1 percent 
loss in the product's value (1 hour out of 168 hours). Applying this 
0.6 percent loss in value to 2.5 percent of the total retail revenue of 
imported Mexican fresh produce results in approximately a $519,000 loss 
in produce value. We calculate that same 0.6 percent loss in product 
value for 2.5 percent of the Canadian imported perishable produce. This 
loss in product value due to the 1-hour wait time totals approximately 
$60,000.
    We used information from the annual imported seafood statistics 
published by the National Marine Fisheries Service (Ref. 8) to estimate 
the weight and wholesale value in dollars of all perishable seafood 
products imported from Mexico and Canada. As we did for perishable 
produce, we mark-up the wholesale price of the perishable seafood by 
100 percent (Ref. 9) to represent the retail value of the products. 
Table 9 of this document shows the value of perishable seafood imports 
from Mexico; table 10 of this document shows the value of perishable 
seafood imports from Canada.

BILLING CODE 4160-01-P

[[Page 59033]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.077


[[Page 59034]]


[GRAPHIC] [TIFF OMITTED] TR10OC03.078


[[Page 59035]]


[GRAPHIC] [TIFF OMITTED] TR10OC03.079


[[Page 59036]]


[GRAPHIC] [TIFF OMITTED] TR10OC03.080

BILLING CODE 4160-01-C
    We used the same logic for seafood as we did for produce to account 
for the possibility of having to resubmit prior notice: A change in the 
type of seafood in the shipment made after the original notice was 
submitted, less than 1 hour before scheduled arrival, would lead to a 
reduction in value. We use the reduction in the value of perishable 
imported seafood to account for the cost of a wait at the border while 
prior notice is resubmitted. Then, assuming that perishable seafood 
will keep for 2 days in a consumer's refrigerator (Ref. 10), we find 
that a 1-hour wait caused by the prior notice requirement for 2.5 
percent of the products would result in a 2.1 percent loss in that 
seafood's value (1 hour out of 48 hours). The lost time would result in 
a $59,000 loss in value of Mexican perishable seafood imports and a 
$978,000 loss in value of Canadian perishable seafood imports.
    Table 11 of this document shows the loss in value caused by the 
resubmitted prior notice information for the 2.5 percent of imported 
Mexican and Canadian fresh seafood and produce affected.
[GRAPHIC] [TIFF OMITTED] TR10OC03.081

    Table 12 of this document presents a summary of the costs 
associated with option 2. Also presented in table 12 of this document 
are the present values of the costs associated with this option, 
calculated using the OMB-recommended discount rates of 3 and 7 percent.
    The first 6 rows of the summary table are the same for options 2 
through 9. The options differ only in the time set for prior notice and 
revisions; the differences in cost across options arise from 
differences in the lost value of produce and seafood, and in some 
options, the cost of truck time.

Table 12.--Summary of Costs for Option 2 (1 Hour Prior Notice Submission
                                  Time)
------------------------------------------------------------------------
                                                              Dollars
                                                            (thousands)
------------------------------------------------------------------------
Learning costs..........................................         $66,240

[[Page 59037]]

 
Coordination costs......................................         $31,095
Computer acquisition costs..............................          $7,600
FDA prior notice system costs...........................         $13,000
Annual costs to fill out prior notice screens...........        $187,500
Additional costs for BRASS users........................         $48,462
Lost value for Mexican produce..........................            $519
Lost value for Canadian produce.........................             $60
Lost value for Mexican seafood..........................             $59
Lost value for Canadian seafood.........................            $978
Total first year costs for Option 2.....................        $355,513
Annual costs after first year...........................        $249,372
Present value of costs at 7% for 20 years...............      $2,741,043
Present value of costs at 3% for 20 years...............      $3,813,068
------------------------------------------------------------------------

    c. Option 3: Minimum prior notice time of 2 hours before arrival; 
electronic submission of information; any change in information 
requires resubmission. Option 3 requires that prior notice be submitted 
2 hours before arrival. If the prior notice time for submission is 2 
hours instead of 1 hour, the probability of having to adjust and 
resubmit prior notice information will be greater. Now, instead of 2.5 
percent of the importers of perishable products from Canada and Mexico 
having to cancel and resubmit their notices, we will assume that the 2-
hour submission timetable means that 5 percent will have to resubmit 
their notices. FDA expects most orders to be placed well in advance of 
the 2-hour timeframe. Carriers of these products may not be able to 
cross the border for 2 hours instead of 1 hour, which affects 1.2 
percent of the produce life span (2 hours out of 168 hours) and 4.2 
percent of the seafood life span (2 hours out of 48 hours).
    Table 13 of this document shows the loss in value caused by the 
resubmitted prior notice information for the 5 percent of imported 
Mexican and Canadian fresh seafood and produce affected.

Table 13.--Loss in Value Caused by Resubmitted Prior Notice Under Option
                                    3
------------------------------------------------------------------------
 
------------------------------------------------------------------------
                  Perishable Produce
 
2001 Imported Mexican produce total retail value.....     $3,458,525,000
1.2% Reduction in value for 5% of Mexican produce....         $2,075,115
2001 Imported Canadian produce total retail value....       $401,826,000
1.2% Reduction in value for 5% of Canadian produce...           $241,096
Total Lost Value for Produce.........................         $2,316,000
 
                  Perishable Seafood
 
2001 Imported Mexican seafood total retail value.....       $112,277,406
4.2% Reduction in value for 5% of Mexican seafood....           $235,783
2001 Imported Canadian seafood total retail value....     $1,863,217,894
4.2% Reduction in value for 5% of Canadian seafood...         $3,912,758
Total Lost Value for Seafood.........................         $4,149,000
------------------------------------------------------------------------

    We do not include the costs of truck time with this option, as the 
prior notice timeframe is relatively short and encompassed within the 
time many trucks currently spend at the borders.
    Table 14 of this document presents a summary of the costs 
associated with option 3. Also presented in table 14 of this document 
are the present values of the costs associated with this option using 
the OMB-recommended discount rates of 3 and 7 percent.

Table 14.--Summary of Costs for Option 3 (2 Hour Prior Notice Submission
                                  Time)
------------------------------------------------------------------------
                                                              Dollars
                                                            (thousands)
------------------------------------------------------------------------
Learning costs..........................................         $66,240
Coordination costs......................................         $31,095
Computer acquisition costs..............................          $7,600
FDA prior notice system costs...........................         $13,000
Annual costs to fill out prior notice screens...........        $187,500
Additional costs for BRASS users........................         $48,462
Lost value for Mexican produce..........................          $2,075
Lost value for Canadian produce.........................            $241
Lost value for Mexican seafood..........................            $236
Lost value for Canadian seafood.........................          $3,913
Total first year costs for Option 3.....................        $360,362
Annual costs after first year...........................        $254,221
Present value of costs at 7% for 20 years...............      $2,792,413

[[Page 59038]]

 
Present value of costs at 3% for 20 years...............      $3,885,209
------------------------------------------------------------------------

    d. Option 4: Minimum prior notice timeframe of 4 hours before 
arrival; electronic submission of information; any change in 
information requires resubmission. Option 4 requires that prior notice 
be submitted 4 hours before arrival instead of 2 hours before arrival.
    How much the business practices of importers, produce growers, and 
seafood processors will be affected by prior notice requirements again 
will depend on how early the orders are received compared with how 
early prior notice must be submitted. If the order for the product is 
placed more than 4 hours before the shipment is scheduled to arrive at 
the border, then there should be no delay in the importation of the 
product.
    What is more likely to cause a wait before crossing the border is 
if the information on the prior notice changes after the prior notice 
has been submitted (i.e., quantity shipped is greater than the quantity 
specified on the prior notice); this situation will be exacerbated if 
the exporting facility is located within 4 hours of the U.S. border. 
For example, if the prior notice is submitted for swordfish before the 
transport is loaded, and the fish to be loaded turns out to be shark 
instead of swordfish, the prior notice information submitted will not 
match the actual shipment. This is one way that information on a prior 
notice submission might change after the prior notice has already been 
submitted to FDA, thus requiring a cancellation of the prior notice and 
a resubmission of the corrected information.
    Having to resubmit a prior notice to FDA may not cause any delay of 
the shipment if the original submission was placed early enough. 
However, it is likely that the necessary corrected prior notice 
information will be resubmitted not long before the article of food 
starts heading for the border. Therefore it is likely that some 
shipments may have to wait several hours before entering the United 
States.
    If the prior notice time for submission is 4 hours before arrival 
instead of 2 hours, the probability of having to adjust and resubmit 
prior notice information will be greater. Now, instead of 5 percent of 
the importers of perishable products from Canada and Mexico having to 
resubmit their notices, we will assume that the 4-hour submission 
timetable means that 20 percent will have to resubmit their notices. 
Since pre-proposal comments asserted that 40 to 100 percent of trucks 
are loaded less than 4 hours before driving to the border, we will 
assume one-half of their lower-bound estimate as the percentage of 
articles of food that will have to have their prior notices 
resubmitted.
    For this option, and other options where the minimum prior notice 
time for food arriving by airplane is 4 hours or longer, we include the 
lost value for highly and very highly perishable produce and seafood 
imported from Central American countries (including some Caribbean 
countries and Colombia), not subject to the AMAA. Perishable produce 
from Belize, Costa Rica, the Dominican Republic, Guatemala, Haiti, 
Jamaica, Honduras, Nicaragua, Panama, and Colombia can all be flown to 
Miami, FL in 2 to 4 hours, depending on the starting location. 
Perishable fish products from the Bahamas, Barbados, Costa Rica, the 
Dominican Republic, El Salvador, Guatemala, Haiti, Honduras, Jamaica, 
Nicaragua, Panama, and Colombia also can be flown to Miami, FL in 2 to 
4 hours. Table 15 of this document shows the retail value of perishable 
produce imported from Central America to the United States for 2001. 
Table 16 of this document shows the retail value of perishable seafood 
imported from Central America for 2001.

BILLING CODE 4160-01-P

[[Page 59039]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.082


[[Page 59040]]


[GRAPHIC] [TIFF OMITTED] TR10OC03.083

BILLING CODE 4160-01-C
    Importers of perishable products from Canada, Mexico, and Central 
America may not be able to cross the border for 4 hours, which is 2.4 
percent of the produce life span (4 hours out of 168 hours) and 8.3 
percent of the seafood life span (4 hours out of 48 hours).
    Table 17 of this document shows the loss in value caused by the 
cancelled and resubmitted prior notice information for the 20 percent 
of imported Mexican, Canadian, and Central American perishable seafood 
and produce affected.

[[Page 59041]]



Table 17.--Loss in Value Caused by Resubmitted Prior Notice Under Option
                                    4
------------------------------------------------------------------------
 
------------------------------------------------------------------------
                  Perishable Produce
 
2001 Imported Mexican produce total retail value.....     $3,458,525,000
2.4% Reduction in value for 20% of Mexican produce...        $16,600,920
2001 Imported Canadian produce total retail value....       $401,826,000
2.4% Reduction in value for 20% of Canadian produce..         $1,928,765
2001 Imported Central American produce total retail         $217,420,000
 value...............................................
2.4% Reduction in value for 20% of Central American           $1,043,616
 produce.............................................
Total Lost Value for Produce.........................        $19,574,000
 
                  Perishable Seafood
 
2001 Imported Mexican seafood total retail value.....       $112,277,406
8.3% Reduction in value for 20% of Mexican seafood...         $1,863,805
2001 Imported Canadian seafood total retail value....     $1,863,217,894
8.3% Reduction in value for 20% of Canadian seafood..        $30,929,417
2001 Imported Central American produce total retail         $251,796,496
 value...............................................
8.3% Reduction in value for 20% of Central American           $4,179,822
 seafood.............................................
Total Lost Value for Seafood.........................        $36,973,000
------------------------------------------------------------------------

    For this 4-hour prior notice submission timeframe and for all 
subsequent options with longer timeframes for submission, we also begin 
to include some holding time costs paid to carriers of products to be 
imported. We add in this cost in response to the comments that 
indicated that at least 40 percent of food products being imported from 
Canada and Mexico are coming from locations located 4 hours or less 
from a U.S. border. For products located less than 4 hours from the 
U.S. border, it is quite possible that the carrier will have to be paid 
for additional waiting time over what had been established under the 
current business practices. Comments indicated that additional truck 
time was a real possibility for all food products being imported and 
not just perishable products. We therefore include a percentage of all 
products requiring prior notice in the cost estimate in table 18 of 
this document.
    We do not have information on the number of import entries that may 
use additional truck time because of prior notice submission times. 
Therefore, we will assume that 20 percent of the 2.3 million lines that 
entered the United States by ground transportation in fiscal year 2002 
(based on OASIS data) will pay for an additional 1 hour of truck time 
per entry. We use 20 percent as the percentage of trucks delayed to be 
consistent with our resubmission rate of 20 percent when the prior 
notice submission timeframe is 4 hours before arrival.

         Table 18.--Cost of Additional Carrier Tme for Option 4
------------------------------------------------------------------------
 
------------------------------------------------------------------------
2002 OASIS import entry lines by ground                        2,300,000
 transportation (truck or train).....................
Average number of lines per entry....................                2.6
Total number of ground entries.......................            884,615
20% of ground entries................................            176,923
Cost for 1 hour of carrier time ($250 per hour)......               $250
Total cost of truck time.............................        $44,231,000
------------------------------------------------------------------------

    Table 19 of this document presents a summary of the costs 
associated with option 4. Also presented in table 19 of this document 
are the present values of the costs associated with this option using 
the OMB-recommended discount rates of 3 and 7 percent.

  Table 19.--Summary of Costs for Option 4 (4 hour minimum prior notice
                            submission time)
------------------------------------------------------------------------
                                                            Dollars
                                                          (thousands)
------------------------------------------------------------------------
Learning costs.......................................            $66,240
Coordination costs...................................            $31,095
Computer acquisition costs...........................             $7,600
FDA prior notice system cost.........................            $13,000
Annual costs to fill out prior notice screens........           $187,500
Additional Costs for BRASS users.....................            $48,462
Lost value for Mexican produce.......................            $16,601
Lost value for Canadian produce......................             $1,929
Lost value for Central American produce..............             $1,044
Lost value for Mexican seafood.......................             $1,864
Lost value for Canadian seafood......................            $30,929
Lost value for Central American seafood..............             $4,180
Cost for truck time..................................            $44,231
Total first year costs for Option 4..................           $454,675
Annual costs after first year........................           $348,534
Present value of costs at 7% for 20 years............         $3,791,567
Present value of costs at 3% for 20 years............         $5,288,348
------------------------------------------------------------------------


[[Page 59042]]

    e. Option 5: Minimum prior notice time frame of 1 hour before 
arrival for vehicles, 4 hours before arrival for rail and air, and 8 
hours before arrival for vessels; electronic submission of information; 
any change in information requires resubmission. Option 5 requires that 
prior notice be submitted 1 hour before arrival for articles of food 
being imported by vehicle and 4 hours before arrival for articles of 
food being imported by rail or air modes of transportation. This option 
is a combination of the minimum prior notice times used in options 2, 
4, and 8. By varying minimum prior notice times by conveyance type, 
option 5 provides flexibility for the importers where it is most 
needed.
    Importers whose articles of food are transported by vehicle from 
Canada and Mexico are most constrained by facility proximity to the 
United States, so a 1-hour minimum prior notice time for these 
shipments is the least constraining possible while still allowing FDA 
the time needed to review the import information. Comments on shipments 
of food arriving in the United States by vehicle indicated that 
(specifically Mexican) food facilities are often close to the U.S. 
border, and thus requested that FDA require a minimum prior notice time 
of 2 hours rather than the proposed 12 noon the calendar day prior to 
arrival. A minimum prior notice time for vehicle traffic of 1 hour will 
be even less constraining on importers than the 2 hours requested by 
the majority of comments.
    Importers whose shipments of food are flown in from the Caribbean, 
Central America, and Colombia, or importers whose food shipments are 
brought into the United States by train will be less constrained by 
minimum prior notice time than food shipments arriving by vehicle, but 
more constrained than food shipments arriving in the United States by 
vessel. Therefore, for this option, importers bringing food into the 
United States by airplane or by train are required to give prior notice 
a minimum 4 hours before arrival. This timeframe is sufficient for even 
shorter flights from Caribbean countries and Central American countries 
to the United States. For example, though the actual flying time of a 
direct flight from the Bahamas to Miami is only 2 hours, the airplane 
must be loaded, taxied to the runway, cleared for take-off, and on 
arrival landed, taxied from the runway, and unloaded. A 4-hour minimum 
prior notice time will therefore seldom be constraining. A 4-hour 
minimum prior notice time for flights could be constraining for rush 
orders of food from Canada and Mexico. However, OASIS fiscal year 2002 
data shows that only about 10,000 food entry lines were flown in from 
Canada and only about 20,000 lines flown in from Mexico. This is a very 
small portion, less than 1 percent, of total shipments from Canada and 
Mexico.
    Option 5 requires that prior notice be submitted 8 hours before 
arrival for articles of food being imported by vessel. We do not 
specifically address food importation by vessel in this option because 
this mode of transport will not be constrained by an 8 hour minimum 
prior notice timeframe. The costs of this option for vessels will be 
the same as in the previous option.
    (i) One-hour minimum prior notice time for food arriving by 
vehicle. Importers of perishable products from Canada and Mexico, whose 
articles of food arrive in the United States by vehicle, will have to 
submit prior notice 1 hour before arrival. This short, minimum 
submission time should eliminate the probability of having to resubmit 
prior notice for all but 2.5 percent of those perishable products 
imported from Canada and Mexico.
    OASIS data indicates that approximately 44 percent of all imported 
food shipments used land transportation to arrive in the United States 
for fiscal year 2002. These shipments must come from Canada and Mexico 
(or in some cases transshipped), as these are the countries that have 
land borders with the United States. OASIS data shows that only about 2 
percent of imported food shipments arrived in the United States by rail 
in 2002, and less than 1 percent of shipments arrived from Canada and 
Mexico by air. Thus, at least 97 percent of all imported food shipments 
arriving from Canada and Mexico used vehicles as the mode of transport.
    Using this 97 percent estimate, we calculate the proportion of the 
total retail value of highly perishable produce and seafood from Canada 
and Mexico that arrives in the United States by vehicle. We then use 
this new retail value, 97 percent of the total value, to calculate the 
lost product value (1 hour out of 168 hours for produce, 1 hour out of 
48 hours for seafood) for the 2.5 percent of highly perishable produce 
and seafood from Canada and Mexico for which importers would have to 
resubmit the prior notice when the minimum submission time is 1 hour. 
Table 20 of this document shows the loss in value caused by the 
cancelled and resubmitted prior notice information for the 2.5 percent 
of imported Mexican and Canadian perishable seafood and produce 
affected.
    We also do not include the cost of truck time with this option, 
because the minimum prior notice time for articles of food arriving by 
vehicle is only 1 hour. Given current border wait times and 
manufacturing/processing facility distance from the U.S. border, it is 
unlikely that articles of food will have to wait to enter the United 
States because of prior notice requirements.

Table 20.--Loss in Value Caused by Resubmitted Prior Notice Under Option
 5 for Shipments Arriving by Vehicle (1-hour minimum notice requirement)
------------------------------------------------------------------------
                                                            Dollars
------------------------------------------------------------------------
                 Perishable Produce:
 
2001 Imported Mexican produce total retail value.....     $3,458,525,000
97% of Total retail value for Mexican produce........     $3,354,769,000
0.6% Reduction in value for 2.5% of Mexican produce..           $503,215
2001 Imported Canadian produce total retail value....       $401,826,000
97% of Total retail value for Canadian produce.......       $389,771,000
0.6% Reduction in value for 2.5% of Canadian produce.            $58,466
Total lost value for produce.........................           $562,000
 
                  Perishable Seafood
 
2001 Imported Mexican seafood total retail value.....       $112,277,000
97% of Total retail value for Mexican seafood........       $108,909,000
2.1% Reduction in value for 2.5% of Mexican seafood..            $57,177
2001 Imported Canadian seafood total retail value....     $1,863,218,000

[[Page 59043]]

 
97% of Total retail value for Canadian seafood.......     $1,807,321,000
2.1% Reduction in value for 2.5% of Canadian seafood.           $948,844
Total lost value for seafood.........................         $1,006,000
------------------------------------------------------------------------

    (ii) Four-hour minimum prior notice time for food arriving by rail 
and air. The 4-hour minimum submission time for prior notice applies to 
articles of food imported by rail and air modes of transportation. A 4-
hour minimum prior notice time for these modes of transportation could 
be constraining for products arriving from the countries bordering the 
United States.
    Since we are assuming that 97 percent of food imported from Canada 
and Mexico arrives by vehicle, we are left with 3 percent that is 
imported by rail or air. We adjust the total retail value of highly 
perishable produce and seafood from Canada and Mexico to account for 
this 3 percent. Table 21 of this document shows the lost value for the 
20 percent of perishable products arriving by rail and air from Canada 
and Mexico that may have to resubmit prior notice when the minimum 
prior notice time is 4 hours.
    For Central American countries, it is probable that most, if not 
all, of their perishable products are imported to the United States by 
air. Therefore, for the highly perishable produce and seafood coming 
from the Central American region, we assume that 97 percent of the 
perishable produce and seafood from Central America is shipped to the 
United States by air. We adjust the total retail value of the 
perishable products from Central America to reflect that 97 percent of 
the total value that arrives in the United States by air. Table 21 of 
this document shows the loss of value for those 20 percent of air 
shipments from Central America for which prior notice was resubmitted 
under option 5.
[GRAPHIC] [TIFF OMITTED] TR10OC03.084

    Table 22 of this document presents a summary of the costs 
associated with option 5, including the costs of the option at the OMB-
recommended discount rates of 3 and 7 percent.

[[Page 59044]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.085

    e. Option 6: Minimum prior notice timeframe of 2 hours before 
arrival for vehicles, 4 hours before arrival for rail and air, and 8 
hours before arrival for vessels; electronic submission of information; 
any change in information requires resubmission (interim final rule). 
Option 6 requires that prior notice be submitted 2 hours before arrival 
for articles of food being imported by vehicle and 4 hours before 
arrival for articles of food being imported by rail or air modes of 
transportation.
    Option 6 requires that prior notice be submitted 8 hours before 
arrival for articles of food being imported by vessel. We do not 
specifically address food import by vessel in this option because this 
mode of transport will not be constrained by an 8-hour minimum prior 
notice timeframe. The costs of this option for vessels will be the same 
as in the previous options.
    i. Two-hour minimum prior notice time for food arriving by vehicle. 
Importers of perishable products from Canada and Mexico, whose articles 
of food arrive in the United States by vehicle, will have to submit 
prior notice 2 hours before arrival. This short, minimum submission 
time frame should eliminate the probability of having to resubmit prior 
notice for all but 5 percent of those perishable products imported from 
Canada and Mexico.
    OASIS data indicates that approximately 44 percent of all imported 
food shipments used land transportation to arrive in the United States 
for fiscal year 2002. These shipments must come from Canada and Mexico 
(or in some cases transshipped), as these are the countries that have 
land borders with the United States. OASIS data shows that only about 2 
percent of imported food shipments arrived in the United States by rail 
in 2002, and less than 1 percent of shipments arrived from Canada and 
Mexico by air. Thus, at least 97 percent of all imported food shipments 
arriving from Canada and Mexico used vehicles as the mode of transport.
    Using this 97 percent estimate, we calculate the proportion of the 
total retail value of highly perishable produce and seafood from Canada 
and Mexico that arrives in the United States by vehicle. This new 
retail value, 97 percent of the total value, is then used to calculate 
the lost product value for the 5 percent of highly perishable produce 
and seafood from Canada and Mexico for which importers would have to 
resubmit the prior notice when the minimum submission time is 2 hours. 
Table 23 of this document shows the loss in value caused by the 
cancelled and resubmitted prior notice information for the 5 percent of 
imported Mexican and Canadian perishable seafood and produce affected.
    We do not include the lost value for perishable seafood and produce 
imported from Central America in table 23 of this document since 
perishable products from Central America are most likely flown into the 
United States. We also do not include the cost of truck time with this 
option since the minimum prior notice time for articles of food 
arriving by vehicle is only 2 hours. Given current border wait times 
and manufacturing/processing facility distance from the U.S. border, it 
is unlikely that trucks will have to wait to enter the United States 
because of prior notice requirements. We expect that some delays will 
occur, but that they will be relatively rare and will impose little 
additional cost compared with a 1-hour minimum prior notice time. We 
therefore do not include any additional truck time costs for this 
option.

[[Page 59045]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.086

    ii. Four-hour minimum prior notice time for food arriving by rail 
and air. The 4-hour minimum submission time for prior notice applies to 
articles of food imported by rail and air modes of transportation. A 4-
hour minimum prior notice timeframe for these modes of transportation 
could be constraining for products arriving from the countries 
bordering the United States.
    Since we are assuming that 97 percent of food imported from Canada 
and Mexico arrives by vehicle, we are left with 3 percent that is 
imported by rail or air. We adjust the total retail value of highly 
perishable produce and seafood from Canada and Mexico to account for 
this 3 percent. Table 24 of this document shows the lost value for the 
20 percent of perishable products arriving by rail and air from Canada 
and Mexico that may have to resubmit prior notice when the minimum 
prior notice timeframe is 4 hours.
    For Central American countries, it is probable that most, if not 
all, of their perishable products are imported to the United States by 
air. Therefore, for the highly perishable produce and seafood coming 
from the Central American region, we assume that 97 percent of the 
perishable produce and seafood from Central America is shipped to the 
United States by air. We adjust the total retail value of the 
perishable products from Central America to reflect that 97 percent of 
the total value that arrives in the United States by air. Table 24 of 
this document shows the loss of value for those 20 percent of air 
shipments from Central America for which prior notice was resubmitted 
under option 6.

[[Page 59046]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.087

    Table 25 of this document presents a summary of the costs 
associated with option 6, including the costs of the option at the OMB-
recommended discount rates of 3 and 7 percent.
[GRAPHIC] [TIFF OMITTED] TR10OC03.088

    f. Option 7: Prior notice required 4 hours before arrival; 
electronic submission of information; allow changes to the prior notice 
submission up to 1 hour before arrival. We now take the estimates in 
option 4 and adjust them to account for the effects of allowing changes 
to the prior notice submission without requiring resubmission. Although 
the original submission time of 4 hours before arrival is relatively 
short, allowing changes to the original submission, in the form of 
electronic amendments and updates, would improve the flow of import 
traffic by reducing the notice resubmission rate. The smaller 
resubmission rate would reduce the loss of value for perishable foods 
that might otherwise have to wait extra time before crossing the U.S. 
border.
    Prior notice requires that certain information about each imported 
food product be relayed to FDA before

[[Page 59047]]

arrival. A more flexible entry screen that allows for updates and 
amendments to some notice information would reduce the likelihood that 
the original notice would have to be resubmitted by importers, thus 
lessening the time burden, and therefore the costs of prior notice. 
Even a 1 hour amendment and updates to prior notice would provide some 
flexibility for importers in industries where certain information, such 
as the type of the product being imported and the quantity of the 
article to be imported, may change or is not known until just before 
shipping.
    It is also important to note here that we assume that the 1 hour 
time FDA has estimated that it takes to fill out each prior notice is 
sufficient for this option, even with the opportunity of amending prior 
notice information. This time is sufficient because amending or 
updating a particular item in the prior notice submission should only 
take a few seconds to a few minutes in time.
    If prior notice can be amended and updated, fewer resubmissions 
would occur. For this option, then, with amendment and updates, we will 
assume that the number of prior notice resubmissions necessitated by 
changes in information on the notice would be reduced from 20 percent 
(as in option 4) to 2.5 percent. FDA believes that the resubmission 
rate for a 4-hour prior notice time with 1-hour amendment will result 
in about the same resubmission rate as option 2 (a straight, 1 hour 
before arrival, prior notice timeframe). FDA believes these two 
timeframes will cause about the same resubmission rate, because both 
arrival timeframes are relatively short and both are within the 
timeframe of 4 hours that was suggested by Canadian and Mexican 
perishable products importers.
    Compared with option 4 (4 hours prior notice with no amendments or 
updates), option 7 would save 4 hours wait time per prior notice 
submission that can be amended or updated. Prior notice submissions 
that cannot be amended or updated, however, would lead to waits of 4 
hours. Those 2.5 percent of shipments for which prior notice cannot be 
amended or updated would wait an extra 4 hours before being able to 
cross the border. This wait translates into 2.4 percent of the 
perishable produce life span (4 hours out of 168 hours) and 8.3 percent 
of the perishable seafood life span (4 hours out of 48 hours). Table 26 
of this document shows the costs of submitting prior notice for a 4-
hour minimum time before arrival, with a 1-hour timeframe before 
arrival for submitting amendment and updates, for Canadian, Mexican, 
and Central American perishable produce and seafood.
[GRAPHIC] [TIFF OMITTED] TR10OC03.089

    Table 27 of this document compares the reduction in the costs of 
this interim final rule if amendments and updates to prior notice are 
allowed (option 7), as opposed to the no-amendment 4-hour option 4.

[[Page 59048]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.090

    Although submitters can amend prior notice information with this 
option, we assume that those 2.5 percent of prior notice submissions 
that cannot use the amendment, but instead have to wait an additional 4 
hours to cross the border, would incur at least some truck costs as a 
result of this wait time. Therefore, we will assume that 2.5 percent of 
the 2.3 million lines that entered the United States by ground 
transportation in fiscal year 2002 (based on OASIS data) would pay for 
an additional 4 hours of truck time per line. We use 2.5 percent as the 
percentage of trucks delayed to be consistent with our resubmission 
rate of 2.5 percent when the prior notice submission timeframe is 4 
hours before arrival with a 1-hour amendment option. Table 28 of this 
document shows the costs of truck time associated with those prior 
notices that cannot be amended.

         Table 28.--Cost of Additional Carrier Time for Option 7
------------------------------------------------------------------------
 
------------------------------------------------------------------------
2002 OASIS import entry lines by ground transportation         2,300,000
 (truck or train).......................................
Average number of lines per entry.......................             2.6
Total number of ground entries..........................         884,615
2.5% of ground entries..................................          22,115
Cost for 4 hours of carrier time ($250 per hour)........          $1,000
Total cost of truck time................................     $22,115,000
------------------------------------------------------------------------

    Table 29 of this document presents a summary of the costs 
associated with option 7. Also presented in table 29 of this document 
are the present values of the costs associated with this option using 
the OMB-recommended discount rates of 3 and 7 percent.

[[Page 59049]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.091

    g. Option 8: Minimum prior notice timeframe of 8 hours before 
arrival; electronic submission of information; any change in 
information requires resubmission (statutory default option). Option 8 
is to issue an interim final rule that incorporates the default minimum 
timeframe for prior notices as provided in the Bioterrorism Act. Pre-
proposal information and comments on the proposed rule indicated that 
Canadian and Mexican produce growers and seafood processors are 
concerned that the longer the minimum time required for the prior 
notice, the less fresh their products will be when they reach U.S. 
customers. Less-than-optimal fresh (i.e., lower quality) products would 
result in a lower price paid for the imported produce or seafood 
shipments, or possibly even the loss of a customer's business to a 
domestic producer.
    For importers of perishable products such as seafood and produce, 
the 8-hour minimum time for prior notice is expected to change business 
practices. How much importer, produce grower, and seafood processor 
business practices will be affected by prior notice requirements will 
depend on how early the orders are received compared with how early 
prior notice must be submitted. Also, as the prior notice submission 
time increases, the location of the exporter in relation to the U.S. 
border becomes a more important factor in determining whether changes 
in business practices are needed.
    If the prior notice time for submission is 8 hours instead of 4 
hours, the probability of having to resubmit prior notice information 
will be greater. Now, instead of 20 percent of the importers of 
perishable products from Canada, Mexico, and Central America having to 
resubmit their notices, we will assume that the 8-hour submission 
timetable means that 30 percent will have to resubmit their notices.
    As explained in option 2, we based the resubmission rate 
percentages for perishable products coming from Canada and Mexico on 
comments FDA received indicating that 40 to 100 percent of the products 
from these two countries are shipped from locations no more than 4 
hours from the border. For shorter prior notice timeframes, starting 
with the 4-hour option and moving downward in minimum prior notice 
time, we halved the resubmission rate because every hour decrease in 
required prior notice submission time will eliminate a significant 
number of prior notice resubmissions for those facilities close to the 
border. For options with longer timeframes, however, instead of 
doubling the resubmission rate, we begin to add an additional 10 
percent resubmission rate for each additional 4 hours of required prior 
notice minimum submission time. We do this because, aside from 
perishable products and rush orders, most foods are ordered in advance 
of shipping and the quantities of such foods are easily identifiable; 
these are orders that will not change and thus will not require 
resubmission of prior notice.
    Carriers of products requiring prior notice may not be able to 
cross the border for 8 hours or longer, instead of 4 hours. This time 
for prior notice represents 4.8 percent of the produce life span (8 
hours out of 168 hours) and 16.7 percent of the seafood life span (8 
hours out of 48 hours). Table 30 of this document shows the loss in 
value caused by the resubmitted prior notice information for the 30 
percent of imported Mexican, Canadian, and Central American perishable 
seafood and produce affected.

[[Page 59050]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.092

    For this 8-hour prior notice submission timeframe, we include 
holding time costs paid to carriers of products to be imported. We add 
in this cost in response to comments indicating that for longer 
submission timeframes and for products located less than 8 hours from 
the U.S. border, it is quite possible that the carrier would have to be 
paid for additional waiting time over what had been established under 
the current business practices.
    We do not have information on the number of import entries that may 
use additional truck time because of prior notice submission 
timeframes. We will assume that 30 percent of the 2.3 million lines 
that entered the United States by ground transportation in fiscal year 
2002 (based on OASIS data) would pay for an additional 2 hours of truck 
time per entry. We use 30 percent as the percentage of trucks delayed 
to be consistent with our resubmission rate of 30 percent when the 
prior notice submission timeframe is 8 hours before arrival. These 
costs are summarized in table 31 of this document.
[GRAPHIC] [TIFF OMITTED] TR10OC03.093

    Table 32 of this document presents a summary of the costs 
associated with option 8. Also presented in table 32 of this document 
are the present values of the costs associated with this option using 
the OMB-recommended discount rates of 3 and 7 percent.

[[Page 59051]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.094

    h. Option 9: Prior notice required 8 hours before arrival; 
electronic submission of information; allow changes to the prior notice 
submission up to 1 hour before arrival. We now take the estimates in 
option 8 and adjust them to account for the effects of allowing changes 
to the prior notice submission. With an original submission time of 8 
hours before arrival, it is likely that allowing changes to the 
original submission, in the form of electronic amendments and updates, 
would improve the flow of import traffic--especially since comments 
indicated that between 40 and 100 percent of products coming from 
Canada and Mexico are within 4 hours of a U.S. border. Regardless of 
when the order is placed, if the exporting facility of the product is 
located less than 8 hours from a U.S. border, allowing amendments and 
updates to prior notice would reduce the notice resubmission rate, and 
also reduce the loss of value for perishable foods that might otherwise 
have to wait extra time before crossing the U.S. border.
    Again, we note with this option, we assume that the FDA 1-hour time 
estimate for filling out each prior notice is sufficient, even with the 
option of amending prior notice information. This time is sufficient 
because amending or updating a particular item in the prior notice 
submission should only take a few seconds to a few minutes in time.
    For this option, with amendment and updates, we will assume that 
the number of prior notice resubmissions necessitated by changes in 
information on the notice will be reduced from 30 to 5 percent. 
Although the amendment will eliminate the need for notice resubmission 
for many entries, the uncertainty associated with some shipment 
information increases as the prior notice minimum submission timeframe 
increases. Thus, for an 8-hour original submission time frame, it is 
unlikely that the allowance of an amendment will reduce the prior 
notice resubmission rate to 2.5 percent as presented in option 7. 
Instead, we assume that an 8-hour prior notice submission timeframe 
with a 1-hour amendment will reduce the prior notice resubmission rate 
to 5 percent.
    Option 9 saves 8 hours of wait time per entry for prior notices 
that can be amended or updated. The 5 percent of imports for which the 
prior notice cannot be amended, however, will end up waiting at the 
border or at the manufacturing/processing facility an additional 8 
hours before arriving in the United States, which is 4.8 percent of the 
perishable produce life span (8 hours out of 168 hours) and 16.7 
percent of the perishable seafood life span (8 hours out of 48 hours). 
Table 33 of this document shows the costs of submitting prior notice 
for an 8-hour minimum time, with a 1-hour amendment and updates, for 
Canadian, Mexican, and Central American perishable produce and seafood.

[[Page 59052]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.095

    Table 34 of this document compares the reduction in the costs of 
this interim final rule if an amendment and update to prior notice is 
allowed (option 9) as opposed to the no-amendment option 8.

[[Page 59053]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.096

    Although submitters can amend prior notice information with this 
option, we assume that those 5 percent of entries that cannot use the 
amendment, but instead have to wait an additional 8 hours before 
arriving in the United States would incur at least some truck costs as 
a result of this wait time. We will therefore assume that 5 percent of 
the 2.3 million lines that entered the United States by ground 
transportation in fiscal year 2002 (based on OASIS data) would pay for 
an additional 8 hours of truck time per prior notice submission. We use 
5 percent as the percentage of trucks delayed to be consistent with our 
resubmission rate of 5 percent when the prior notice submission 
timeframe is 8 hours before arrival with a 1-hour amendment option. 
Table 35 shows the costs of truck time associated with those prior 
notices that cannot be amended.
[GRAPHIC] [TIFF OMITTED] TR10OC03.097

    Table 36 of this document presents a summary of the costs 
associated with option 9. Also presented in table 36 of this document 
are the present values of the costs associated with this option using 
the OMB-recommended discount rates of 3 and 7 percent.

[[Page 59054]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.098

    i. Option 10: Prior notice received by 12 noon of the calendar day 
before arrival; electronic submission of information; any change in 
information requires resubmission. This option requires that prior 
notice be submitted no later than 12 noon of the calendar day before 
the expected day of arrival. Under this option, prior notice submitters 
will have to let FDA know of the incoming food shipment at least 12 
hours before the shipment reaches the U.S. port of arrival. This option 
would likely cause a change in importer business practices and the 
business practices of their clients in much the same way as option 8, 
but the potential loss of product value is higher because the minimum 
prior notice time has increased.
    Again, how business practices would be affected by prior notice 
requirements depends on how early the invoice orders are received, when 
the truck is loaded, and when prior notice is submitted.
    As before, we assume that as the minimum notice time increases, the 
likelihood of a resubmission also increases. Instead of 30 percent of 
the importers of perishable products from Canada and Mexico having to 
cancel their original prior notices and resubmit, we will assume that 
the 12-hour submission timetable means that 40 percent will have to 
cancel and resubmit their notices.
    We increase the percentage of resubmission this time by 10 percent 
because as the prior notice time frame increases relative to the time 
of arrival, it becomes more likely that the prior notice information 
will change after the notice is submitted to FDA, thus requiring 
resubmission of the notice. The transporters of products with 
resubmitted prior notices may then have to wait as long as 12 hours, 
which affects 7.1 percent of the produce life span (12 hours out of 168 
hours) and 25 percent of the seafood life span (12 hours out of 48 
hours).
    Table 37 of this document shows the loss in value caused by the 
resubmitted prior notice information for the 40 percent of imported 
Mexican, Canadian, and Central American perishable seafood and produce 
that might be affected.

[[Page 59055]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.099

    For option 10, we also include the costs of additional carrier time 
that may be necessary due to the longer minimum prior notice submission 
timeframe. For option 8 we had included the cost of an additional 2 
hours of truck time for 30 percent of ground-based import entry lines; 
for this option we will include the cost of an additional 4 hours of 
truck time for 40 percent of ground-based import entry lines. We expect 
the percentage of imported shipments that need extra truck time, and 
the truck time itself, to increase as the prior notice submission 
timeframe increases. These costs are summarized in table 38 of this 
document.
[GRAPHIC] [TIFF OMITTED] TR10OC03.100

    Table 39 of this document presents a summary of the costs 
associated with option 10. Also presented in table 39 of this document 
are the present values of the costs associated with this option using 
the OMB-recommended discount rates of 3 and 7 percent.

[[Page 59056]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.101

    j. Option 11: Prior notice received by 12 noon of the calendar day 
before arrival; electronic submission of information; allow changes to 
the prior notice submission up to 1 hour before arrival. We now take 
the estimates in option 10 and adjust them to account for the effects 
of allowing changes to the prior notice submission. Since prior notice 
must be submitted by 12 noon on the calendar day before arrival, it is 
reasonable to expect that not all the information required on a prior 
notice would be final.
    The prior notice requires the addresses of the submitter, importer, 
owner, and consignee, as well as the carrier, manufacturer, and grower 
if known. Required information also includes the identity of the 
article of food, its FDA Country of Production, the country from which 
the food is shipped, its CBP entry identifier, the date, time, and 
anticipated port of arrival, and planned shipment information.
    Increasing the number of required fields that can be changed in the 
prior notice before arrival reduces the likelihood that the information 
would have to be completely resubmitted by importers. This change would 
lessen the time burden, and therefore, the cost of having to submit 
prior notice. Allowing a 1-hour amendment and updates to prior notice 
would provide some flexibility for importers in industries where some 
of the required information, such as the specific type of food (i.e., 
codfish instead of fish) of the product being imported, may change or 
is not known until just before shipping. Again we note that we assume 
that 1-hour time FDA estimates that it takes to fill out each prior 
notice is sufficient, even with the option of amending prior notice 
information. This time is sufficient because amending or updating a 
particular item in the prior notice submission should only take a few 
seconds to a few minutes.
    For this option with amendment and updates, we assume that the 
number of prior notice resubmissions necessitated by changes in 
information on the notice would be reduced from 40 percent (as in 
option 10) to 10 percent. The notice resubmission rate for this option 
is expected to be higher than previous options with amendments because 
the original submission must be given by 12 noon on the calendar day 
before arrival. The lengthening of the minimum prior notice time period 
from 8 hours with amendment (option 9) to 12 noon the calendar day 
before arrival with amendment (this option) suggests that there would 
be significantly more prior notices initially submitted for which all 
required information has not been completely determined. Less-than-
final information on original prior notice submissions increases the 
likelihood that the notice will require revision, either in the form of 
an amendment or in the form of a total resubmission of the original 
prior notice.
    Option 11 saves 12 hours wait time per entry line that can be 
amended or updated for the prior notice over the time used in option 9. 
Those shipments, whose prior notice must be completely resubmitted, 
would wait an additional 12 hours at the manufacturing/processing 
facility or at the U.S. border; 7.1 percent of the perishable produce 
life span (12 hours out of 168 hours) and 25 percent of the perishable 
seafood life span (12 hours out of 48 hours). Table 40 of this document 
shows the costs of submitting prior notice for a 12-hour minimum time, 
with a 1-hour timeframe for amendment and updates before arrival, for 
Canadian, Central American, and Mexican perishable produce and seafood.

[[Page 59057]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.102

    Table 41 of this document compares the reduction in the costs of 
this rule if an amendment and update to prior notice is allowed (option 
11) as opposed to the no-amendment option 10.

[[Page 59058]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.103

    Although submitters can amend prior notice information with this 
option, we assume that those 10 percent of entry lines that cannot be 
amended, but instead have to wait an additional 12 hours to arrive in 
the United States would incur at least some truck costs corresponding 
to this wait time. Therefore we will assume that 10 percent of the 2.3 
million lines that entered the United States by ground transportation 
in fiscal year 2002 (based on OASIS data) would pay for an additional 
12 hours of truck time per line. We use 10 percent as the percentage of 
trucks delayed to be consistent with our resubmission rate of 10 
percent when the prior notice submission timeframe is noon the calendar 
day before arrival with a 1-hour amendment option. Table 42 of this 
document shows the costs of truck time associated with those prior 
notices that cannot be amended.

        Table 42.--Cost of Additional Carrier Time for Option 11
------------------------------------------------------------------------
 
------------------------------------------------------------------------
2002 OASIS import entry lines by ground transportation         2,300,000
 (truck or train).......................................
Average number of lines per entry.......................             2.6
Total number of ground entries..........................         884,615
10% of ground entries...................................          88,462
Cost for 12 hours of carrier time ($250 per hour).......          $3,000
Total cost of truck time................................    $265,386,000
------------------------------------------------------------------------

    Table 43 of this document presents a summary of the costs 
associated with option 11. Also presented in table 43 of this document 
are the present values of the costs associated with this option using 
the OMB-recommended discount rates of 3 and 7 percent.

[[Page 59059]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.104

    k. Option 12: Prior notice received by 12 noon of the calendar day 
before arrival; electronic submission of information; allow changes to 
the prior notice submission up to 2 hours before arrival (proposed 
rule). Option 12 is the option that was originally proposed by FDA. 
This option requires prior notice submission by noon on the calendar 
day before arrival, with updates and amendments that can be submitted 
up to 2 hours before scheduled arrival at a U.S. port. We re-present 
the option here for comparison, as the costs attributable to each 
option have changed significantly since the proposed rule stage.
    For this option with amendment and updates, we assume that the 
number of prior notice resubmissions necessitated by changes in 
information on the notice would be reduced from 40 percent (as in 
option 10) to 15 percent. The notice resubmission rate for this option 
is expected to be higher than previous options with amendments because 
the original submission must be given by 12 noon on the calendar day 
prior to arrival and the minimum amendment timeframe before arrival is 
now 2 hours instead of 1 hour.
    Option 12 saves 12 hours wait time per entry line that can be 
amended or updated for the prior notice over the time used in option 
10. Those shipments whose prior notice must be completely resubmitted 
however, would wait an additional 12 hours at the manufacturing/
processing facility or at the U.S. border; 7.1 percent of the 
perishable produce life span (12 hours out of 168 hours) and 25 percent 
of the perishable seafood life span (12 hours out of 48 hours). Table 
44 of this document shows the costs of submitting prior notice for a 
12-hour minimum time, with a 2-hour timeframe for amendment and updates 
before arrival, for Canadian, Central American, and Mexican perishable 
produce and seafood.

[[Page 59060]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.105

    Although submitters can amend prior notice information with this 
option, we assume that those 15 percent of entry lines that cannot be 
amended, but instead have to wait an additional 12 hours to arrive in 
the United States would incur at least some truck costs corresponding 
to this wait time. Therefore we will assume that 15 percent of the 2.3 
million lines that entered the U.S. by ground transportation in fiscal 
year 2002 (based on OASIS data) would pay for an additional 12 hours of 
truck time per line. We use 15 percent as the percentage of trucks 
delayed to be consistent with our resubmission rate of 15 percent when 
the prior notice submission timeframe is noon the calendar day before 
arrival with a 2-hour amendment option. Table 45 of this document shows 
the costs of truck time associated with those prior notices that cannot 
be amended.
[GRAPHIC] [TIFF OMITTED] TR10OC03.106

    Table 46 of this document presents a summary of the costs 
associated with option 12. Also presented in table 46 of this document 
are the present values of the costs associated with this option using 
the OMB-recommended discount rates of 3 and 7 percent.

[[Page 59061]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.107

4. Summary of Options
    Table 47 of this document gives a summary of the costs associated 
with the prior notice rule for each option presented. The costs 
associated with the prior notice requirements are included for each 
option for all modes of transportation. These costs include the 
following items: Learning the rule, coordinating the required 
information, acquiring computer equipment, and annual submission costs 
for all imported food shipments. The cost of lost value for perishable 
products is included in each option calculation depending on mode of 
transportation and minimum prior notice submission time. Lost truck 
time is included for options with longer timeframes.

BILLING CODE 4160-01-P

[[Page 59062]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.108

BILLING CODE 4160-01-C

[[Page 59063]]

    Sensitivity analysis. We estimate that the costs of the interim 
final rule (option 6) will be about $367 million in the first year and 
$261 million in later years. At a 7 percent discount rate, the present 
value of the costs of the interim final rule, discounted 20 years into 
the future, would be about $3 billion; for a discount rate of 3 
percent, the present value costs would be $4 billion. These estimates 
rely on several important assumptions:
    [sbull] In option 6, for perishable products from Canada, Mexico, 
and Central America: 5 percent of prior notices will need to be 
resubmitted if the notice must be submitted 2 hours before arrival for 
vehicles; 20 percent of prior notices will need to be resubmitted if 
the notice must be submitted 4 hours before arrival for air and rail.
    [sbull] The minimum entry time for food shipments imported over 
land and by air is a constraining factor for those importers who use 
these modes of transportation. The additional costs for shipments made 
over land and by air are greater for a specified minimum prior notice 
time, the closer the facility is to the U.S. border. Shipments arriving 
by sea are not likely to be affected by a specified minimum prior 
notice time.
    [sbull] The retail value of imported fresh seafood and produce is 
100 percent higher than its wholesale value.
    [sbull] The number of entry lines requiring prior notice will not 
increase over time.
    [sbull] Prior notice must be submitted for informal food entries, 
i.e., international mail.
    [sbull] BRASS is not compatible with submitting prior notice.
    We now present a sensitivity analysis, which shows how our 
estimates of costs for the interim final rule change if we use 
different assumptions. We substitute the following assumptions for 
those used previously:
    [sbull] In option 6 for perishable products from Canada, Mexico, 
and Central America: 10 percent of prior notices will need to be 
resubmitted when the prior notice time is 2 hours before arrival for 
vehicles; 40 percent of prior notices will need to be resubmitted if 
the prior notice must be submitted 4 hours before arrival for shipments 
arriving by rail and air.
    [sbull] The retail value of imported fresh seafood and produce is 
200 percent higher than its wholesale value.
    [sbull] The number of entry lines requiring prior notice will 
increase 3 percent per year.
    [sbull] Prior notice does not need to be submitted for informal 
food entries, i.e., international mail.
    [sbull] BRASS is compatible with submitting prior notice.
    Tables 48 and 49 of this document show the results of the 
sensitivity analysis. The tables show that the estimated cost of the 
interim final rule is most sensitive to the assumed fraction of prior 
notices that will need to be changed. The present value of the interim 
final rule is most sensitive to the rate of discount.
[GRAPHIC] [TIFF OMITTED] TR10OC03.109


[[Page 59064]]


[GRAPHIC] [TIFF OMITTED] TR10OC03.110

5. Benefits
    The FDA prior notice system will provide FDA with enhanced 
knowledge of what articles of food are being imported or offered for 
import into the United States including the anticipated port of 
arrival, the country of production, and the specific product identity. 
Requiring prior notice of imported food shipments and defining the 
required data information will therefore improve FDA's ability to 
detect accidental and deliberate contamination of food and to deter 
deliberate contamination.
    Currently, FDA does not receive much advance notice about food 
products entering the United States from foreign sources, or the 
location of the food's anticipated port of arrival. With the 
information required by this interim final rule, FDA will know in 
advance what articles of food are being imported or offered for import, 
before they arrive at the port. In the event of a credible threat for a 
specific product or a specific manufacturer/processor, for example, FDA 
will be able to mobilize and assist in the detention and removal of 
products that may be a serious health threat to human or animals.
    FDA plans to review prior notices in a central location, on a 24/7 
basis. These persons will decide on a case-by-case basis whether the 
article of food needs to be held. Because prior notice will be linked 
through ABI/ACS system in most instances, if FDA wishes to stop and 
hold a shipment for examination, inspection, sampling, or other purpose 
and does not have personnel at the needed location, pursuant to a 
Memorandum of Understanding between FDA and CBP, CBP will act on FDA's 
behalf until FDA personnel can reach the location. The prior notice 
system linked through ABI/ACS will allow FDA to send messages to the 
screens of individual CBP staff, ensuring that time sensitive 
information is received and acted upon by the appropriate persons. 
Having notice of an article of food imported or offered for import into 
the United States before it reaches a U.S. port will allow FDA 
personnel to be ready to respond to shipments that appear to pose a 
significant and immediate serious risk to public health.
    Historical evidence suggests that a terrorist or other intentional 
strike on the food supply is a low-probability, but potentially high-
cost event. FDA has conducted its own assessment of the vulnerability 
of the U.S. food supply and additionally has commissioned two threat 
assessments, one through the Battelle Memorial Institute and a second 
through the Institute of Food Technologists. These assessments 
determined the most serious risks of intentional contamination during 
various stages of food production and distribution. The results of 
these assessments are classified. We have also received intelligence 
information regarding threats to the food supply that are guiding our 
food security efforts. Nonetheless, FDA lacks data to estimate the 
likelihood of a strike occurring. Without knowing the likelihood of a 
strike occurring, we cannot quantitatively measure the reduction in 
probability of an event occurring.
    We can, however, show the potential risk associated with 
contaminated imported foods. Many past outbreaks have been traced to 
imported foods (Refs. 12 and 13); table 50 of this document gives some 
examples. An intentional attack on the food supply that sought to 
disrupt the food supply and sicken many U.S. citizens could be much 
larger than the examples given in table 50.
    The potential hazard associated with a single shipment of imported 
food is large. For example, a single line entry from OASIS for a 
truckload of imported cantaloupe (gross weight 1,000 lb) represents 510 
lb (231,332 grams) (g) of edible food, or 1,652 (140 g) servings. If an 
entire line or shipment is contaminated, then that number of servings 
represents the potential

[[Page 59065]]

exposure to the hazard. The FDA prior notice system alone will not 
prevent such exposures, but by increasing the amount of information 
available and giving FDA notice in advance of arrival, an essential 
component of the barrier against accidental or deliberate contamination 
of food is formed. FDA is better able to integrate intelligence, 
vulnerability, and entry data to plan import surveillance activities as 
a result.
[GRAPHIC] [TIFF OMITTED] TR10OC03.111

    We can examine the high costs of a potential terrorist event by 
comparing costs of responding to a terrorist event with and without the 
advantage of having the FDA prior notice system. For example, if U.S. 
officials or FDA receives intelligence concerning the possibility of an 
intentional contamination of an incoming food shipment, in absence of 
prior notice, even with information on the type of food product, 
officials would be unlikely to know when and where the food was 
expected to cross U.S. borders. In this case, it is likely that 
officials would slow down the movement of food shipments through the 
border ports or possibly even close down some ports of entry to prevent 
the contaminated articles from entering the United States.
    Information on the west coast port lock-out during Fall 2002, 
indicated that the closing of 29 major west coast ports cost the U.S. 
economy $1 billion a day (Refs. 14 and 15). Given that there are 361 
ports of entry for the entire United States, if U.S. officials had to 
close all ports to prevent contaminated food from entering the country, 
the U.S. economy could lose upwards of $12.5 billion each day the ports 
remain closed. This cost exceeds the first year costs ($367 million), 
the annual costs ($261 million), and the present value of costs ($3 
billion at the 7 percent discount rate and $4 billion at the 3 percent 
discount rate) for the chosen option of this rule. Thus, having the FDA 
prior notice system does not eliminate, but may significantly reduce 
the costs of a terrorist attack on the food supply as compared to not 
having the system.

                  Table 51.--Cost Benefit Summary Table
------------------------------------------------------------------------
                                   Annualized costs    Annualized costs
                                   over 20 years at    over 20 years at
                                   7% discount rate    3% discount rate
                                     ($ millions)        ($ millions)
------------------------------------------------------------------------
Option 5--2 hour prior notice                  $272               $269
 for vehicle, 4 hour for rail
 and air, 8 hour vessels
 (interim final rule)...........
Benefits--FDA will know in advance what articles of food are being
 imported or offered for import, before they arrive at the port. In the
 event of a credible threat, FDA will be able to mobilize and assist in
 the detention and removal of specific products that may pose a serious
 health threat to human or animals.
------------------------------------------------------------------------

B. Small Entity Analysis (or Final Regulatory Flexibility Analysis)

    FDA has examined the economic implications of this interim final 
rule as required by the Regulatory Flexibility Act (5 U.S.C. 601-612). 
If a rule has a significant economic impact on a substantial number of 
small entities, the Regulatory Flexibility Act requires agencies to 
analyze regulatory options that would lessen the economic effect of the 
rule on small entities consistent with statutory objectives. FDA finds 
that this interim final rule will have a significant economic impact on 
a substantial number of small entities.
1. Number of Establishments Affected
    FDA finds that this interim final rule would affect 77,427 U.S. 
importers. Most of these importers have fewer than 500 employees, thus 
making them small

[[Page 59066]]

businesses as defined by the Small Business Administration. Because 
most of the importers affected are small, all options considered in the 
Benefit-Cost Analysis in section IV.A of this document are regulatory 
relief options.
    A few comments stated that FDA's analysis of the impact of prior 
notice on small businesses was inadequate. The comments also wished to 
see a breakdown of costs of the rule per small business by industry 
sector. Unfortunately, FDA does not have detailed information on which 
businesses subject to this interim final rule are small, nor did 
comments provide such information. Therefore, FDA cannot perform a 
detailed analysis of the costs per small business by industry sector. 
With limited data, FDA can estimate an average cost per importer for 
some of the prior notice cost categories, estimate some costs of the 
rule per retail establishment, and provide an average estimate of cost 
per establishment if the costs of the rule were evenly distributed 
across the supply chain.
2. Costs per Entity
    This interim final rule requires FDA be notified of incoming 
products electronically before the food arrives at a U.S. port. The 
annual cost of doing so is about $2,400 per submitter (based on $187.5 
million in notification costs/77,427 U.S. importers). This calculation 
is presented in table 52 of this document. Also presented in table 52 
is the cost per importer to learn about the prior notice interim final 
rule and to coordinate the information that needs to be submitted; the 
costs per importer of these two activities are about $850 and $400, 
respectively.
    As discussed and shown in tables 1B and 2 of this document, about 
3,100 U.S. importers are estimated to not have electronic transmitting 
capacity and will have to obtain computer equipment (at a cost of about 
$2,000 per importer) and Internet access (at a cost of about $240 
annually) in order to comply with this interim final rule. FDA could 
not provide flexibility for those importers who do not have electronic 
transmitting capacity, because paper notices could not be submitted in 
the prior notice timeframe and would therefore actually be more 
burdensome to importers, and because FDA would not be able to receive, 
review, and respond to paper prior notices that are submitted on a 
routine basis.
    This interim final rule will cause some loss of product value if 
the prior notice requirement causes perishable products to have to wait 
any length of time before arriving at a U.S. port. The costs of lost 
product value vary with the required notice time. FDA does not have 
information on the subset of importers who will be affected by these 
costs; therefore, we cannot calculate a cost per importer for these 
potential losses. We do discuss the various costs associated with this 
possibility in the options outlined previously.
    Table 52 of this document shows the average costs per importer to 
learn the rule, coordinate information, and submit prior notice. Table 
52 also shows the average costs to the importer to absorb the costs of 
not being able to use BRASS and to absorb costs of lost value of 
perishable products. Table 52 also shows these average costs per retail 
establishment and per establishment across the supply chain. Numbers 
for establishments come from the County Business Patterns, U.S. Census, 
and Non-Employer statistics. A complete discussion of these 
establishment numbers can be found in the FDA Registration of Food 
Facilities interim final rule (Ref. 20).
[GRAPHIC] [TIFF OMITTED] TR10OC03.112

3. Additional Flexibility Considered
    Because of the requirements of the Bioterrorism Act, FDA is 
precluded from selecting some of the options that typically would be 
considered to lessen the economic effect of the interim final rule on 
small entities, including granting an exemption to small entities. FDA 
concludes that it would be inconsistent with section 307 of the 
Bioterrorism Act to allow small entities a later effective date, since 
the Bioterrorism Act establishes an effective date for prior notice 
that applies to FDA-regulated food imported or offered for import into 
the United States, whether or not FDA has issued a final rule by this 
deadline. Thus, FDA concludes that Congress intended for prior notice 
to apply to FDA-regulated food by the effective date established in the 
Bioterrorism Act.

C. Unfunded Mandates

    Title II of the Unfunded Mandates Reform Act of 1995 (Public Law 
104-4) requires cost-benefit and other analyses before any rulemaking 
if the rule would include a ``Federal mandate that may result in the 
expenditure by State, local, and tribal governments, in the aggregate, 
or by the private sector, of $100,000,000 or more (adjusted annually 
for inflation) in any 1 year.'' The current inflation-adjusted 
statutory threshold is $113 million. FDA has determined that this 
interim final rule is significant under the Unfunded Mandates Reform 
Act. FDA has carried out the cost-benefit analysis in preceding 
sections (see table 47 of this document for the total costs). The other 
requirements under the Unfunded Mandates Act of 1995 include assessing 
the rule's effects on the following factors:

[[Page 59067]]

    [sbull] Future costs;
    [sbull] Particular regions, communities, or industrial sectors;
    [sbull] National productivity;
    [sbull] Economic growth;
    [sbull] Full employment;
    [sbull] Job creation; and
    [sbull] Exports.
    The issues listed in the bullets are covered in detail in the cost 
benefit analysis of the preceding sections, with the exception of the 
trade effects of this interim final rule, which we will discuss here.
    Although most of the information required for prior notice is 
already supplied to CBP when importing food products, this new notice 
requirement may cause a reduction of imports of certain food products 
into the United States. For example, food manufacturers, processors, or 
growers may choose to stop exporting food products to the United States 
if the additional costs of complying with the prior notice increase the 
price of the imported product (or perhaps decrease the quality of the 
product) to the point where they cannot compete with a domestically-
grown or produced product. This may be the case for food products that 
are grown or produced in the United States with an elastic enough 
supply to meet consumer demand without large increases in price. For 
example, if Florida-grown and California-grown oranges meet the demand 
for the fruit in this country at or close to current prices, then it is 
unlikely that the United States will import many oranges from other 
countries, if the price of the imported product rises (or the product 
quality is lowered) because of the prior notice requirement.
    On the other hand, for example, there are products for which 
substitutes, and more specifically, U.S. grown or produced substitutes, 
are not available. In these cases, and in cases where U.S. demand for 
the product greatly exceeds domestic supply, importers will pass along 
to the consumer any increase in price for the product brought about by 
the prior notice requirement (as long as the quality and other 
attributes of the product remain intact). For example, exotic fruits 
such as coconuts, mangoes, and papayas are not grown in significant 
quantities in the United States; if the demands for those fruits are 
relatively inelastic, there will not be a significant decrease in 
quantity demanded in the United States when the importers raise the 
price of the fruit to cover the costs of submitting prior notice.

D. SBREFA Major Rule

    The Small Business Regulatory Enforcement Fairness Act of 1996 
(SBREFA) (Pub. L. 104-121) defines a major rule for the purpose of 
congressional review as having caused or being likely to cause one or 
more of the following: An annual effect on the economy of $100 million 
or more; a major increase in costs or prices; significant adverse 
effects on competition, employment, productivity, or innovation; or 
significant adverse effects on the ability of U.S.-based enterprises to 
compete with foreign-based enterprises in domestic or export markets. 
In accordance with SBREFA, OMB has determined that this interim final 
rule is a major rule for the purpose of congressional review.

VI. Paperwork Reduction Act of 1995

    This interim final rule contains information collection provisions 
that are subject to review by OMB under the Paperwork Reduction Act of 
1995 (44 U.S.C. 3501-3520). A description of these provisions is given 
below with an estimate of the annual reporting burden. The estimate 
includes the time for reviewing instructions, searching existing data 
sources, gathering and maintaining the data needed, and completing and 
reviewing each collection of information, i.e., each prior notice.
    Title: Prior Notice of Imported Food.

A. Description

    Section 801(m) of the FD&C Act (21 U.S.C. 381(m)) requires prior 
notice to the Secretary of Health and Human Services (the Secretary) of 
an article of food that is being imported or offered for import into 
the United States. Section 801(m)(1) of the FD&C Act states that the 
Secretary shall require submission of notice providing the identity of 
each of the following: The article of food; the manufacturer; the 
shipper; the grower, if known at the time of notification; the 
originating country; the shipping country; and the anticipated port of 
arrival. Section 801(m)(2)(A) of the FD&C Act states that the Secretary 
shall by regulation prescribe the time of submission of the 
notification in advance of importation or the offering of the food for 
import, which period shall be no less than the minimum amount of time 
necessary for the Secretary to receive, review, and appropriately 
respond to such notification, but may not exceed 5 days. FDA's prior 
notification of imported food shipments interim final rule implements 
these statutory provisions.
1. Comments on the Burden of Information Collection
    Some comments on the proposed burden of information collection 
stated that the information collection would not be necessary if ABI/
ACS could be used to submit the required information. Other comments 
stated that the information collection was unproductive and unduly 
burdensome for the benefits it would provide. Still other comments 
stated that FDA had underestimated the hours associated with the 
reporting burden.
    FDA's agreement with CBP to allow most prior notices to be 
submitted through ABI/ACS will greatly reduce the burden of this new 
collection of information.
    A few comments were concerned that FDA had underestimated the 
proposed burden because they did not understand that FDA had calculated 
the submitting burden based on import entries, not entry lines. For 
each import entry, the prior notice or notices are expected to take 
about an hour to file. The prior notice or notices for each import 
entry would cover approximately 2.6 lines, with each line representing 
a different article of food to be imported. For this interim final rule 
burden of information analysis, FDA has clarified how the estimates 
were calculated to allay the comments' concerns.
2. Information Collection Burden Estimate
    FDA estimates the burden for this information collection as 
follows:

[[Page 59068]]

[GRAPHIC] [TIFF OMITTED] TR10OC03.113

B. Hour Burden Estimate

1. Number of Establishments Affected
    Using 2001 fiscal year information from OASIS (industry codes 02 
through 52, 54, and 70 through 72), FDA has determined that there are 
approximately 77,427 importers and consignees who receive shipments of 
food imported or offered for import into the United States. FDA does 
not have specific information on who will submit prior notice since 
there are no restrictions on who can submit prior notice. Therefore, 
FDA estimates prior notice submission information based on the 77,427 
importers of food in OASIS.
2. New and Closing Importers
    In addition to the U.S. importers currently in existence, in future 
years new import businesses will open and some existing import 
businesses will close. These new submitters would have to become 
familiar with the FDA prior notice system and possibly obtain computer 
equipment and Internet access to comply with prior notice requirements.
    According to the Small Business Administration Office of Advocacy, 
in 2001, about 10 percent of all businesses were new and 10 percent of 
businesses closed. Using the 10 percent opening and closing business 
statistic, and given that there are currently 77,427 U.S. importers, 
FDA assumes that on a yearly basis 7,743 importers will leave the 
market and 7,743 importers will enter the market.
3. Hour Burden Estimate Researching the Prior Notice Requirement
    a. Learning the interim final rule. To become familiar with the 
requirements for this interim final rule, FDA estimates that one 
manager and two subordinates from each importing business will attend 
an 8-hour training session on the prior notice regulation. This one-
time research burden for the existing importers is about 1,858,248 
hours (3 people per firm x 8 hours x 77,427 importers). This portion of 
the estimate is for 21 CFR part 1, subpart I, 1.279 through 1.285 and 
is shown in row 1 of table 53 of this document.
    In the years that follow the startup year for prior notice, it is 
reasonable to expect a certain percentage of importing firms to enter 
and leave the market. In addition to the first year burden to research 
prior notice, it is expected that 185,832 hours will be spent annually 
researching the prior notice requirement by the anticipated 7,743 new 
importers entering the market annually that must learn about prior 
notice (3 people per firm x 8 hours x 7,743 new importers). This 
portion of the estimate is for 21 CFR part 1, subpart I, 1.279 through 
1.285 and is shown in row 2 of table 53 of this document.
    b. Coordinating the information. FDA assumes it will take about 2 
business days (16 hours) for an administrative employee of the prior 
notice-submitting firm to coordinate with others to establish new 
business practices required to receive the information needed for prior 
notice. We assume this set-up time is sufficient to coordinate 
information for existing importing accounts. The total hours needed to 
gather information for existing accounts is 1,238,832 (77,427 importing 
firms x 16 hours per firm). This portion of the estimate is for 21 CFR 
part 1, subpart I, 1.279 through 1.285 and is shown in row 1 of table 
53 of this document. Thus, the total burden listed in row 1 is 
1,858,248 hours + 1,238,832 hours = 3,097,080 one-time burden hours to 
learn the rule and coordinate information.
    In addition to the first year coordination burden, we expect 
importing businesses to see a 10 percent turnover in their accounts. 
Thus, in future years, importing firms will spend 123,883 hours to 
gather information on their new accounts. This portion of the estimate 
is for 21 CFR part 1, subpart I, 1.276 through 1.285 and is shown in 
row 2 of table 53 of this document. Thus, the total burden listed in 
row 2 is 185,832 hours + 123,883 hours = 309,715 one-time burden hours 
for new firms to learn the rule and coordinate information.
4. Submitting Prior Notice
    To estimate the repetitive effort of submitting a prior notice, FDA 
assumes the activity takes 1 hour each time an import entry is 
submitted. An import

[[Page 59069]]

entry, on average, constitutes 2.6 different articles of food; a prior 
notice must be submitted for each article of food. Therefore we 
estimate that submitting prior notice for each article of food will 
take 23 minutes to complete (23 minutes per line = 60 minutes/2.6 lines 
per entry). On an annual basis, submitting prior notice will take about 
2.5 million hours (23 minutes (or 0.384 hours) per prior notice x 6.5 
million notices). This estimate is for 21 CFR part 1, subpart I, 1.280 
through 1.281 and is shown in row 3 of table 53 of this document.
    FDA does not have information on how many prior notices will come 
from each of the 77,427 importers. However, we assume that 6.5 million 
prior notices will be submitted annually based on fiscal year 2002 
OASIS information and estimates of prior notice capacity. We divide 6.5 
million lines by the 77,427 importers to get an average annual response 
frequency per importer of 84 notices.
5. Changes to a Confirmed Prior Notice
    The annual total number of changes made by importers to confirmed 
prior notices will vary depending on the minimum prior notice 
submission time required. For example, more confirmed prior notices 
will likely have to be changed if the minimum prior notice submission 
time is noon the calendar day before arrival as opposed to a minimum 
submission time of 2 hours before arrival. FDA's interim final rule 
requires a minimum prior notice submission time for each of the 
following situations: 2 hours before arrival for articles of food 
imported by vehicle, 4 hours before arrival for articles of food 
imported by rail and air, and 8 hours before arrival for articles of 
food imported by vessel.
    By combining the percentages by mode of transport and taking into 
account the location of the exporting country, we assume that about 4 
percent of all prior notices (260,000 notices) will have to be 
resubmitted after confirmation is received from FDA. We assume that 
changes in the prior notices will be minor adjustments; therefore, both 
the cancellation of the original notice and the resubmission of the new 
notice are estimated to take about 30 minutes. This estimate is for 21 
CFR part 1, subpart I, 1.282 and is shown in row 4 of table 53 of this 
document.
6. Refused Admission
    Although FDA at this time does not have enough information to 
estimate a percent of refusals under the new prior notice program, for 
the purposes of this analysis FDA estimates the reporting burden 
assuming a 2 percent refused admission rate.
    An imported food product is subject to refusal under section 
801(m)(1) of the FD&C Act if it arrives at the port of arrival with 
untimely, inaccurate, or no prior notice. FDA estimates that about 
130,000 of the annual prior notices will be subject to refusal (2 
percent of 6.5 million prior notices).
    If an article of food is refused under section 801(m)(1) of the 
FD&C Act, the food must be held until the prior notice has been 
correctly submitted or until the product is exported. FDA must be 
notified of the location where the food has been or will be moved 
within 24 hours of refusal.
    In many cases, the location notice will be given as part of a 
correction and resubmission, as described in the next section. FDA 
estimates that 13,000 out of the 130,000 annual refusals will give the 
location notice separately and that it will take about 15 minutes per 
prior notice to notify FDA of the shipment's location. This will result 
in about 3,250 hours (13,000 notices x 0.25 hours). This estimate is 
for 21 CFR part 1, subpart I, 1.283(a)(2)(iv) and 1.285(c)(4) and is 
shown in row 5 of table 53 of this document.
7. Correction and Resubmission of Prior Notice
    FDA estimates that 97,500 out of the 130,000 annual refusals will 
be because of inaccurate prior notice requiring resubmission, or 
because no prior notice was submitted. FDA estimates that it will take 
an hour to cancel, correct, and resubmit, or submit (in the case of no 
notice) each of these 97,500 notices. This estimate is for 21 CFR part 
1, subpart I, 1.283(a)(5)(ii) and is shown in row 6 of table 53 of this 
document.
8. Exportation of Products Refused Admission
    Some importers of articles of food that have been refused admission 
into the United States will decide to export their product rather than 
try to submit or resubmit prior notice. FDA estimates that this will 
occur for only about 25 percent of the 130,000 articles refused 
admission for inaccurate, untimely, or no prior notice. If an article 
of food is refused admission under section 801(m)(1) of the FD&C Act 
and exported, FDA requests, but does not require, that prior notice be 
cancelled. FDA estimates that for these 32,500 articles of food, prior 
notice will be cancelled 25 percent of the time and that this 
cancellation will take 15 minutes per article. This estimate is for 21 
CFR part 1, subpart I, 1.283(a)(7) and is shown in row 7 of table 53 of 
this document.
9. FDA Review Request
    If an article of food to be imported is refused under section 
801(m)(1) of the FD&C Act or placed under hold under section 801(1), a 
request may be submitted asking for an FDA review. FDA estimates that 
of the 130,000 articles of food that are refused admission under 
section 801(m)(1) of the FD&C Act or placed under hold under section 
801(1) of the FD&C Act yearly, 10 percent will request an FDA review 
(13,000 reviews). FDA estimates that it will take the requestor about 8 
hours to prepare the factual and legal information necessary to request 
a review. Thus, importers will spend about 104,000 hours on review 
requests annually. This estimate is for 21 CFR part 1, subpart I, 
1.283(a)(6)(i) through (a)(6)(iv) and 1.285(f)(1) through (f)(4) and is 
shown in row 8 of table 53 of this document.

C. Capital Cost and Operating and Maintenance Cost Burden

    Since all prior notices must be submitted electronically, we assume 
that the 3,097 responsible parties without Internet access (4 percent 
of the 77,427 importers) will have to purchase the appropriate computer 
equipment and gain Internet access to transmit the information. 
Assuming computer equipment costs each firm $2,000 and yearly Internet 
access costs each firm $240 ($20 per month for 12 months), this results 
in a one-time computer cost for these facilities of $6,194,000 and a 
recurring Internet access cost of $743,000. This estimate is for 21 CFR 
part 1, subpart I, 1.279 through 1.285 and is included in row 1 of 
table 53 of this document.
    For the 7,743 new firms that enter the import market each year, we 
expect 310 of them to need to purchase computer equipment and obtain 
Internet access. On an annual basis we expect new importers to spend 
$620,000 on computers and $74,400 on Internet access to be able to 
submit their prior notice information. This estimate is for 21 CFR part 
1, subpart I, 1.279 through 1.285 and is included in row 2 of table 53 
of this document.
    The information collection provisions of this interim final rule 
have been submitted to OMB for review.
    Prior to the effective date of this interim final rule, FDA will 
publish a notice in the Federal Register announcing OMB's decision to 
approve, modify, or disapprove the information collection provisions in 
this interim final rule. An agency may not conduct

[[Page 59070]]

or sponsor, and a person is not required to respond to, a collection of 
information unless it displays a currently valid OMB control number.

VII. Analysis of Environmental Impact

    The agency has carefully considered the potential environmental 
effects of this action. FDA has concluded under 21 CFR 25.30(h) that 
this action is of a type that does not individually or cumulatively 
have a significant effect on the human environment. Therefore, neither 
an environmental assessment nor an environmental impact statement is 
required.

VIII. Federalism

    FDA has analyzed this interim final rule in accordance with the 
principles set forth in Executive Order 13132. FDA has determined that 
the rule does not contain policies that have substantial direct effects 
on the States, on the relationship between the National Government and 
the States, or on the distribution of power and responsibilities among 
the various levels of government. Accordingly, the agency has concluded 
that the rule does not contain policies that have federalism 
implications as defined in the Executive order and, consequently, a 
federalism summary impact statement is not required.

IX. References

    The following references have been placed on display in the 
Division of Dockets Management (see ADDRESSES) and may be seen by 
interested persons between 9 a.m. and 4 p.m., Monday through Friday. 
FDA has verified the Web site addresses, but is not responsible for any 
subsequent changes to the Web sites after this document publishes in 
the Federal Register.

    1. Ruling NY G89921 (June 12, 2001), U.S. Bureau of Customs and 
Border Protection, http://rulings.customs.gov.
    2. Bureau of Economic Analysis, http://www.bea.doc.gov.
    3. U.S. Department of Labor, Bureau of Labor Statistics, 
``National Compensation Survey: Occupation Wages in the United 
States, 2000, Summary 01-04,'' available at http://www.bls.gov/ncs/ocs/sp/ncbl0354.pdf.
    4. USDA Agricultural Marketing Service, March 2002, ``Fresh 
Fruits and Vegetable Shipments,'' http://www.ams.usda.gov.
    5. Kasmire, Dr. Robert F., Vegetable Marketing Specialist, 
http://www.thepacker.com/rbcs/handbookarticles/properis.htm, 
accessed on 9.16.02.
    6. USDA Agricultural Marketing Service produce point price 
reports for various border crossings for the dates September 12, 
2002, and September 16, 2002, http://www.ams.usda.gov.
    7. Florida Department of Agriculture and Consumer Services 
(FDACS), http://www.ffva.com/rps.htm.
    8. National Marine Fisheries Service, Fisheries Statistics and 
Economics Division, http://www.st.nmfs.gov, accessed September 2002.
    9. Florida Department of Agriculture and Consumer Services, 
http://doacs.state.fl.us/press/1999/090999.html and http://www.ffva.com/rps.htm.
    10. Center for Food Safety and Applied Nutrition, http://
www.cfsan.fda.gov/[sim]dms/qa-sto8.html.
    11. Small Business Administration Office of Advocacy, ``Small 
Business by the Numbers'', May 2002, http://www.sba.gov/advo/.
    12. Herwaldt B.L., M.L. Ackers, and Cyclospora Working Group, 
``An Outbreak in 1996 of Cyclosporiasis Associated With Imported 
Raspberries,'' New England Journal of Medicine, May 29, 1997, 1548-
1556.
    13. Food Safety: Federal Efforts to Ensure the Safety of 
Imported Foods Are Inconsistent and Unreliable, GAO Publication, 
April 1998, http://www.gao.gov.
    14. ``Port Lockout Could Harm U.S. Economy,'' http://www.firstcoastnews.net/news/2002-10-01/usw_portlockout.asp.
    15. ``Transportation official says strike at U.S. port would 
ripple across globe,'' http://www.govexec.com/dailyfed/0202/022702gsn1.htm.
    16. ``The Informal Sector in El Salvador,'' Embassy of the 
United States of America in El Salvador, http://sansalvador.usembassy.gov/ Select Economic Info (left column), then 
select the first option ``Economic and Commercial Reports, 
Updates,'' at next screen under Socio-Economic Reports, select the 
last article ``The Informal Sector in El Salvador, 1999,'' and 
Import Alert 1A1211, FDA Guidance, March 1998, http://www.fda.gov/ora/_import_ia1211.html.
    17. Guidance for Industry, Importers and Filers, Food Security 
Preventive Measures Guidance, FDA Publication, March 2003.
    18. Investigations Operations Manual, FDA Publication, page 179.
    19. FDA Registration of Food Facilities interim final rule, 
published elsewhere in the issue of the Federal Register.

List of Subjects in 21 CFR Part 1

    Cosmetics, Drugs, Exports, Food labeling, Imports, Labeling, 
Reporting and recordkeeping requirements.

0
Therefore, under the Federal Food, Drug, and Cosmetic Act and under 
authority delegated to the Commissioner of Food and Drugs, 21 CFR part 
1 is amended as follows:

PART 1--GENERAL ENFORCEMENT REGULATIONS

0
1. The authority citation for 21 CFR part 1 continues to read as 
follows:

    Authority: 15 U.S.C. 1453, 1454, 1455; 19 U.S.C. 1490, 1491; 21 
U.S.C. 321, 331, 332, 333, 334, 335a, 343, 350c, 350d, 352, 355, 
360b, 362, 371, 374, 381, 382, 393; 42 U.S.C. 216, 241, 243, 262, 
264.


0
2. Subpart I, consisting of Sec. Sec.  1.276 through 1.285, is added to 
part 1 to read as follows:
Subpart I--Prior Notice of Imported Food

General Provisions

Sec.
1.276 What definitions apply to this subpart?
1.277 What is the scope of this subpart?

Requirements to Submit Prior Notice of Imported Food

1.278 Who is authorized to submit prior notice?
1.279 When must prior notice be submitted to FDA?
1.280 How must you submit prior notice?
1.281 What information must be in a prior notice?
1.282 What must you do if information changes after you have 
received confirmation of a prior notice from FDA?

Consequences

1.283 What happens to food that is imported or offered for import 
without adequate prior notice?
1.284 What are the other consequences of failing to submit adequate 
prior notice or otherwise failing to comply with this subpart?
1.285 What happens to food that is imported or offered for import 
from unregistered facilities that are required to register under 21 
CFR part 1, subpart H?

General Provisions


Sec.  1.276  What definitions apply to this subpart?

    (a) The act means the Federal Food, Drug, and Cosmetic Act.
    (b) The definitions of terms in section 201 of the act (21 U.S.C. 
321) apply when the terms are used in this subpart, unless defined 
below.
    (1) Calendar day means every day shown on the calendar.
    (2) Country from which the article originates means FDA Country of 
Production.
    (3) Country from which the article is shipped means the country in 
which the article of food is loaded onto the conveyance that brings it 
to the United States or, in the case of food sent by international 
mail, the country in which the article will be mail.
    (4) FDA Country of Production means:
    (i) For an article of food that is in its natural state, the 
country where the article of food was grown, including harvested or 
collected and readied for shipment to the United States. If an article 
of food is wild fish, including seafood that was caught or harvested 
outside the waters of the United States by a vessel that is not 
registered in the United States, the FDA Country of Production is the 
country in which the vessel is registered. If an article of food that 
is in its natural state was grown,

[[Page 59071]]

including harvested or collected and readied for shipment, in a 
Territory, the FDA Country of Production is the United States.
    (ii) For an article of food that is no longer in its natural state, 
the country where the article was made; except that, if an article of 
food is made from wild fish, including seafood, aboard a vessel, the 
FDA Country of Production is the country in which the vessel is 
registered. If an article of food that is no longer in its natural 
state was made in a Territory, the FDA Country of Production is the 
United States.
    (5) Food has the meaning given in section 201(f) of the act,
    (i) Except for purposes of this subpart, it does not include:
    (A) Food contact substances as defined in section 409(h)(6) of the 
act (21 U.S.C. 348(h)(6)); or
    (B) Pesticides as defined in 7 U.S.C. 136(u).
    (ii) Examples of food include fruits, vegetables, fish, including 
seafood, dairy products, eggs, raw agricultural commodities for use as 
food or as components of food, animal feed (including pet food), food 
and feed ingredients, food and feed additives, dietary supplements and 
dietary ingredients, infant formula, beverages (including alcoholic 
beverages and bottled water), live food animals, bakery goods, snack 
foods, candy, and canned foods.
    (6) Grower means a person who engages in growing and harvesting or 
collecting crops (including botanicals), raising animals (including 
fish, which includes seafood), or both.
    (7) International mail means foreign national mail services. 
International mail does not include express carriers, express 
consignment operators, or other private delivery services.
    (8) No longer in its natural state means that an article of food 
has been made from one or more ingredients or synthesized, prepared, 
treated, modified, or manipulated. Examples of activities that render 
food no longer in its natural state are cutting, peeling, trimming, 
washing, waxing, eviscerating, rendering, cooking, baking, freezing, 
cooling, pasteurizing, homogenizing, mixing, formulating, bottling, 
milling, grinding, extracting juice, distilling, labeling, or 
packaging. Crops that have been cleaned (e.g., dusted, washed), 
trimmed, or cooled attendant to harvest or collection or treated 
against pests, waxed, or polished are still in their natural state for 
purposes of this subpart. Whole fish headed, eviscerated, or frozen 
attendant to harvest are still in their natural state for purposes of 
this subpart.
    (9) Port of arrival means the water, air, or land port at which the 
article of food is imported or offered for import into the United 
States, i.e., the port where the article of food first arrives in the 
United States. This port may be different than the port where 
consumption or warehouse entry or foreign trade zone admission 
documentation is presented to the United States Bureau of Customs and 
Border Protection (CBP).
    (10) Port of entry, in sections 801(m) and 801(l) of the act, means 
the port of entry as defined in 19 CFR 101.1.
    (11) Registration number refers to the registration number assigned 
by FDA under section 415 of the act (21 U.S.C. 350d) and 21 CFR part 1, 
subpart H.
    (12) Shipper means the owner or exporter of the article of food who 
consigns and ships the article from a foreign country or the person who 
sends an article of food by international mail to the United States.
    (13) United States means the Customs territory of the United States 
(i.e., the 50 states, the District of Columbia, and the Commonwealth of 
Puerto Rico), but not the Territories.
    (14) You means the person submitting the prior notice, i.e., the 
submitter, or the person transmitting prior notice information on 
behalf of the submitter, i.e., the transmitter.


Sec.  1.277  What is the scope of this subpart?

    (a) This subpart applies to all food for humans and other animals 
that is imported or offered for import into the United States for use, 
storage, or distribution in the United States, including food for gifts 
and trade and quality assurance/quality control samples, food for 
transshipment through the United States to another country, food for 
future export, and food for use in a U.S. Foreign Trade Zone.
    (b) Notwithstanding paragraph (a), this subpart does not apply to:
    (1) Food for an individual's personal use when it is carried by or 
otherwise accompanies the individual when arriving in the United 
States;
    (2) Food that was made by an individual in his/her personal 
residence and sent by that individual as a personal gift (i.e., for 
non-business reasons) to an individual in the United States;
    (3) Food that is imported then exported without leaving the port of 
arrival until export;
    (4) Meat food products that at the time of importation are subject 
to the exclusive jurisdiction of the U.S. Department of Agriculture 
(USDA) under the Federal Meat Inspection Act (21 U.S.C. 601 et seq.);
    (5) Poultry products that at the time of importation are subject to 
the exclusive jurisdiction of USDA under the Poultry Products 
Inspection Act (21 U.S.C. 451 et seq.); and
    (6) Egg products that at the time of importation are subject to the 
exclusive jurisdiction of USDA under the Egg Products Inspection Act 
(21 U.S.C. 1031 et seq.).

Requirements To Submit Prior Notice of Imported Food


Sec.  1.278  Who is authorized to submit prior notice?

    A prior notice for an article of food may be submitted by any 
person with knowledge of the required information. This person is the 
submitter. The submitter also may use another person to transmit the 
required information on his/her behalf. The person who transmits the 
information is the transmitter. The submitter and transmitter may be 
the same person.


Sec.  1.279  When must prior notice be submitted to FDA?

    (a) Except as provided in paragraph (c) of this section, you must 
submit the prior notice to FDA and the prior notice submission must be 
confirmed by FDA for review as follows:
    (1) If the article of food is arriving by land by road, no less 
than 2 hours before arriving at the port of arrival;
    (2) If the article of food is arriving by land by rail, no less 
than 4 hours before arriving at the port of arrival;
    (3) If the article of food is arriving by air, no less than 4 hours 
before arriving at the port of arrival; or
    (4) If the article of food is arriving by water, no less than 8 
hours before arriving at the port of arrival.
    (b) Except in the case of an article of food imported or offered 
for import by international mail, you may not submit prior notice more 
than 5 calendar days before the anticipated date of arrival of the food 
at the anticipated port of arrival.
    (c) Notwithstanding paragraphs (a) and (b) of this section, if the 
article of food is arriving by international mail, you must submit the 
prior notice before the article of food is sent to the United States.
    (d) FDA will notify you that your prior notice has been confirmed 
for review with a reply message that contains a Prior Notice (PN) 
Confirmation Number. Your prior notice will be considered submitted and 
the prior notice time will start when FDA has confirmed your prior 
notice for review.
    (e) The PN Confirmation Number must accompany any article of food

[[Page 59072]]

arriving by international mail. The PN Confirmation Number must appear 
on the Customs Declaration that accompanies the package.
    (f) A copy of the confirmation including the PN Confirmation 
Number, must accompany any article of food that is subject to this 
subpart when it is carried by or otherwise accompanies an individual 
when arriving in the United States. The copy of the confirmation must 
be provided to CBP or FDA upon arrival.
    (g) The PN Confirmation Number must accompany any article of food 
for which the prior notice was submitted through the FDA Prior Notice 
System Interface (FDA PN System Interface) when the article arrives in 
the United States and must be provided to CBP or FDA upon arrival.


Sec.  1.280  How must you submit prior notice?

    (a) You must submit the prior notice electronically to FDA. You 
must submit all prior notice information in the English language, 
except that an individual's name, the name of a company, and the name 
of a street may be submitted in a foreign language. All information, 
including these items, must be submitted using the Latin (Roman) 
alphabet. Unless paragraph (d) of this section applies, you must submit 
prior notice through:
    (1) The CBP Automated Broker Interface of the Automated Commercial 
System (ABI/ACS); or
    (2) The FDA PN System Interface at http://www.access.fda.gov. You 
must submit prior notice through the FDA PN System Interface for 
articles of food imported or offered for import by international mail, 
other transaction types that cannot be made through ABI/ACS, and 
articles of food that have been refused under section 801(m)(1) of the 
act and this subpart.
    (b) If a custom broker's or self-filer's system is not working or 
if the ABI/ACS interface is not working, prior notice must be submitted 
through the FDA PN System Interface.
    (c) If FDA determines that FDA PN System Interface is not working, 
FDA will issue notification at http://www.access.fda.gov and FDA Web 
site at http://www.fda.gov --see Prior Notice. Once FDA issues this 
notification, if you intended to use the FDA PN System Interface to 
submit a prior notice, you must submit prior notice information by e-
mail or by fax to FDA. The location for receipt of submission by e-mail 
or fax is listed at http://www.fda.gov--see Prior Notice--PN System 
Interface.
    (d) If FDA determines that the Operational and Administration 
System for Import Support (OASIS) is not working, FDA will issue 
notification at http://www.access.fda.gov, on the FDA Web site at 
http://www.fda.gov, and through messages in ABI/ACS. Once FDA issues 
this notification, all prior notices must be submitted to FDA by e-mail 
or by fax. The location for receipt of submission by e-mail or fax is 
listed at http://www.fda.gov--see Prior Notice.
    (e) Prior notice information will only be accepted at the listed e-
mail or fax locations if FDA determines that the FDA PN System 
Interface or OASIS is not working.


Sec.  1.281  What information must be in a prior notice?

    (a) General. For each article of food that is imported or offered 
for import into the United States, except by international mail, you 
must submit the information for the article that is required in this 
paragraph.
    (1) The name of the individual submitting the prior notice and his/
her business address, and phone number, fax number, and e-mail address, 
and the name and address of the submitting firm, if applicable. If a 
registration number is provided, city and country may be provided 
instead of the full address;
    (2) If different from the submitter, the name of the individual and 
firm, if applicable, transmitting the prior notice on behalf of the 
submitter and his/her business address, and phone number, fax number, 
and e-mail address. If a registration number is provided, city and 
country may be provided instead of the full address;
    (3) The entry type;
    (4) The CBP entry identifier (e.g., CBP entry number or in-bond 
number), if available;
    (5) The identity of the article of food being imported or offered 
for import, as follows:
    (i) The complete FDA product code;
    (ii) The common or usual name or market name;
    (iii) The estimated quantity of food that will be shipped, 
described from largest container to smallest package size; and
    (iv) The lot or code numbers or other identifier of the food if 
required by the act or FDA regulations, e.g., low acid canned foods, by 
21 CFR 113.60(c); acidified foods, by 21 CFR 114.80(b); and infant 
formula, by 21 CFR 106.90;
    (6) For an article of food that is no longer in its natural state, 
the name and address of the manufacturer and the registration number 
assigned to the facility that is associated with the article of food. A 
registration number is not required for a facility associated with an 
article of food if the article is imported or offered for import for 
transshipment, storage, and export, or further manipulation and export. 
If the article of food is sent by an individual as a personal gift 
(i.e., for nonbusiness reasons) to an individual in the United States, 
you may provide the name and address of the firm that appears on the 
label under 21 CFR 101.5 instead of the name, address, and registration 
number of the manufacturer. If a registration number is provided, city 
and country may be provided instead of the full address;
    (7) For an article of food that is in its natural state, the name 
and growing location address of the grower, if known. If the submitter 
does not know the identity of the grower or, if the article has been 
consolidated, the identity of any of the growers, you may provide the 
name and address of the firm that has consolidated the articles of food 
from different growers or different growing locations;
    (8) The FDA Country of Production;
    (9) The name and address of the shipper and, if the shipper is 
required to register under 21 CFR part 1, subpart H, the registration 
number assigned to the shipper's facility that is associated with the 
article of food. A registration number is not required for a facility 
associated with an article of food if the article is imported or 
offered for import for transshipment, storage, and export, or further 
manipulation and export. If a registration number is provided, city and 
country may be provided instead of the full address;
    (10) The country from which the article is shipped;
    (11) Anticipated arrival information about the article of food 
being imported or offered for import, as follows:
    (i) The anticipated port of arrival and, if the anticipated port of 
arrival has more than one border crossing, the specific anticipated 
border crossing where the food will be brought into the United States;
    (ii) The anticipated date on which the article of food will arrive 
at the anticipated port of arrival; and
    (iii) The anticipated time of that arrival;
    (12) The name and address of the importer. If a registration number 
is provided, city and country may be provided instead of the full 
address. The identity of the owner is not required for an article of 
food that is imported or offered for import for transshipment through 
the United States under a Transportation and Exportation entry;
    (13) The name and address of the owner if different from the 
importer or ultimate consignee. If a registration

[[Page 59073]]

number is provided, city and country may be provided instead of the 
full address. The identity of the importer is not required for an 
article of food that is imported or offered for import for 
transshipment through the United States under a Transportation and 
Exportation entry;
    (14) The name and address of the ultimate consignee. If a 
registration number is provided, city and country may be provided 
instead of the full address. The identity of the ultimate consignee is 
not required for an article of food that is imported or offered for 
import for transshipment through the United States under a 
Transportation and Exportation entry;
    (15) The mode of transportation;
    (16) The Standard Carrier Abbreviation Code (SCAC) or International 
Air Transportation Association (IATA) code of the carrier which is, or 
will be, carrying the article of food from the country from which the 
article is shipped to the United States, or if codes are not 
applicable, then the name and country of the carrier;
    (17) Planned shipment information, as applicable:
    (i) The Airway Bill number(s) or Bill of Lading number(s). This 
information is not required for an article of food when carried by or 
otherwise accompanying an individual when entering the United States;
    (ii) For food arriving by ocean vessel, the vessel name and voyage 
number;
    (iii) For food arriving by air carrier, the flight number;
    (iv) For food arriving by truck, bus, or rail, the trip number;
    (v) For food arriving as containerized cargo by water, air, or 
land, the container number(s). This information is not required for an 
article of food when carried by or otherwise accompanying an individual 
when entering the United States;
    (vi) For food arriving by rail, the car number. This information is 
not required for an article of food when carried by or otherwise 
accompanying an individual;
    (vii) For food arriving by privately owned vehicle, the license 
plate number and State or province; and
    (viii) The 6-digit Harmonized Tariff Schedule (HTS) code.
    (b) Articles arriving by international mail. For each article of 
food that is imported or offered for import into the United States by 
international mail, you must submit the information for the article 
that is required in this paragraph.
    (1) The name of the individual submitting the prior notice and his/
her business address, and phone number, fax number, and e-mail address, 
and the name and address of the submitting firm, if applicable. If a 
registration number is provided, city and country may be provided 
instead of the full address;
    (2) If different from the submitter, the name of the individual and 
firm, if applicable, transmitting the prior notice on behalf of the 
submitter and his/her business address and phone number, fax number, 
and e-mail address. If a registration number is provided, city and 
country may be provided instead of the full address;
    (3) The entry type (which will be a mail entry);
    (4) The identity of the article of food being imported or offered 
for import, as follows:
    (i) The complete FDA product code;
    (ii) The common or usual name or market name;
    (iii) The estimated quantity of food that will be shipped, 
described from largest container to smallest package size; and
    (iv) The lot or code numbers or other identifier of the food if 
required by the act or FDA regulations, e.g., low acid canned foods, by 
21 CFR 113.60(c); acidified foods, by 21 CFR 114.80(b); and infant 
formula, 21 CFR 106.90;
    (5) For an article of food that is no longer in its natural state, 
the name and address of the manufacturer and the registration number 
assigned to the facility that is associated with the article of food. A 
registration number is not required for a facility associated with an 
article of food if the article is imported or offered for import for 
transshipment, storage and export, or further manipulation and export. 
If the article of food is sent by an individual as a personal gift 
(i.e., for non-business reasons) to an individual in the United States, 
you may provide the name and address of the firm that appears on the 
label under 21 CFR 101.5 instead of the name, address, and registration 
number of the manufacturer. If a registration number is provided, city 
and country may be provided instead of the full address;
    (6) For an article of food that is in its natural state, the name 
and growing location address of the grower, if known. If the submitter 
does not know the identity of the grower or, if the article has been 
consolidated, the identity of any of the growers, you may provide the 
name and address of the firm that has consolidated the articles of food 
from different growers or different growing locations;
    (7) The FDA Country of Production;
    (8) The name and address of the shipper and, if the shipper is 
required to register under 21 CFR part 1, subpart H, the registration 
number assigned to the shipper's facility that is associated with the 
article of food. A registration number is not required for a facility 
associated with an article of food if the article is imported or 
offered for import for transshipment, storage and export, or further 
manipulation and export. If a registration number is provided, city and 
country may be provided instead of the full address;
    (9) The country from which the article is shipped (i.e., mailed);
    (10) The anticipated date of mailing; and
    (11) The name and address of the U.S. recipient.
    (c) Refused articles. If the article of food has been refused under 
section 801(m)(1) of the act and this subpart, you must submit the 
information for the article that is required in this paragraph. 
However, if the refusal is based on Sec.  1.283(a)(1)(iii) (Untimely 
Prior Notice), you do not have to re-submit any information previously 
submitted unless it has changed or the article has been exported and 
the original prior notice was submitted through ABI/ACS. If the refusal 
is based on Sec.  1.283(a)(ii), you should cancel the previous 
submission per Sec.  1.282(b) and (c).
    (1) The name of the individual submitting the prior notice and his/
her business address, and phone number, fax number, and e-mail address, 
and the name and address of the submitting firm, if applicable. If a 
registration number is provided, city and country may be provided 
instead of the full address;
    (2) If different from the submitter, the name of the individual and 
firm, if applicable, transmitting the prior notice on behalf of the 
submitter and his/her business address, and phone number, fax number, 
and e-mail address. If the registration number is provided, city and 
country may be provided instead of the full address;
    (3) The entry type;
    (4) The CBP entry identifier (e.g., CBP entry number or in-bond 
number), if available;
    (5) The identity of the article of food being imported or offered 
for import, as follows:
    (i) The complete FDA product code;
    (ii) The common or usual name or market name;
    (iii) The quantity of food that was shipped, described from largest 
container to smallest package size; and
    (iv) The lot or code numbers or other identifier of the food if 
required by the act or FDA regulations, e.g., low acid canned foods, by 
21 CFR 113.60(c); acidified foods, by 21 CFR 114.80(b); and infant 
formula, by 21 CFR 106.90;

[[Page 59074]]

    (6) For an article of food that is no longer in its natural state, 
the name and address of the manufacturer and the registration number 
assigned to the facility that is associated with the article of food. A 
registration number is not required for a facility associated with an 
article of food if the article is imported or offered for import for 
transshipment, storage and export, or further manipulation and export. 
If the article of food is sent by an individual as a personal gift 
(i.e., for non-business reasons) to an individual in the United States, 
you may provide the name and address of the firm that appears on the 
label under 21 CFR 101.5 instead of the name, address, and registration 
number of the manufacturer. If a registration number is provided, city 
and country may be provided instead of the full address;
    (7) For an article of food that is in its natural state, the name 
and growing location address of the grower, if known. If the submitter 
does not know the identity of the grower or, if the article has been 
consolidated, any of the growers, you may provide the name and address 
of the firm that has consolidated the articles of food from different 
growers or different growing locations;
    (8) The FDA Country of Production;
    (9) The name and address of the shipper and, if the shipper is 
required to register under 21 CFR part 1, subpart H, the registration 
number assigned to the shipper's facility that is associated with the 
article of food. A registration number is not required for a facility 
associated with an article of food if the article is imported or 
offered for import for transshipment, storage and export, or further 
manipulation and export. If a registration number is provided, city and 
country may be provided instead of the full address;
    (10) The country from which the article is shipped;
    (11) The port of arrival;
    (12) The name and address of the importer. If a registration number 
is provided, city and country may be provided instead of the full 
address. The identity of the importer is not required for an article of 
food that is imported or offered for import for transshipment through 
the United States under a Transportation and Exportation entry;
    (13) The name and address of the owner, if different from the owner 
or ultimate consignee. If a registration number is provided, city and 
country may be provided instead of the full address. The identity of 
the owner is not required for an article of food that is imported or 
offered for import for transshipment through the United States under a 
Transportation and Exportation entry;
    (14) The name and address of the ultimate consignee. If a 
registration number is provided, city and country may be provided 
instead of the full address. The identity of the ultimate consignee is 
not required for an article of food that is imported or offered for 
import for transshipment through the United States under a 
Transportation and Exportation entry;
    (15) The mode of transportation;
    (16) The Standard Carrier Abbreviation Code (SCAC) or International 
Air Transportation Association (IATA) code of the carrier which carried 
the article of food from the country from which the article is shipped 
to the United States, or if codes are not applicable, then the name and 
country of the carrier;
    (17) Shipment information, as applicable:
    (i) The Airway Bill number(s) or Bill of Lading number(s); however, 
this information is not required for an article of food when carried by 
or otherwise accompanying an individual when entering the United 
States;
    (ii) For food that arrived by ocean vessel, the vessel name and 
voyage number;
    (iii) For food that arrived by air carrier, the flight number;
    (iv) For food that arrived by truck, bus, or rail, the trip number;
    (v) For food that arrived as containerized cargo by water, air, or 
land, the container number(s); however, this information is not 
required for an article of food when carried by or otherwise 
accompanying an individual when entering the United States;
    (vi) For food that arrived by rail, the car number; however, this 
information is not required for an article of food when carried by or 
otherwise accompanying an individual;
    (vii) For food that arrived by privately owned vehicle, the license 
plate number and State or province;
    (viii) The 6-digit HTS code; and
    (18) The location and address where the article of refused food 
will be or is being held, the date the article has arrived or will 
arrive at that location, and identification of a contact at that 
location.


Sec.  1.282  What must you do if information changes after you have 
received confirmation of a prior notice from FDA?

    (a)(1) If any of the information required in Sec.  1.281(a) except 
the information required in:
    (i) Sec.  1.281(a)(5)(iii) (quantity),
    (ii) Sec.  1.281(a)(11) (anticipated arrival information), or
    (iii) Sec.  1.281(a)(17) (planned shipment information) changes 
after you receive notice that FDA has confirmed your prior notice 
submission for review, you must resubmit prior notice in accordance 
with this subpart unless the article of food will not be offered for 
import or imported into the United States.
    (2) If any of the information required in Sec.  1.281(b), except 
the information required in Sec.  1.281(b)(10) (the anticipated date of 
mailing), changes after you receive notice that FDA has confirmed your 
prior notice submission for review, you must resubmit prior notice in 
accordance with this subpart, unless the article of food will not be 
offered for import or imported into the United States.
    (b) If you submitted the prior notice via the FDA PN System 
Interface, you should cancel the prior notice via the FDA PN System 
Interface.
    (c) If you submitted the prior notice via ABI/ACS, you should 
cancel the prior notice via ACS by requesting that CBP delete the 
entry.

Consequences


Sec.  1.283  What happens to food that is imported or offered for 
import without adequate prior notice?

    (a) For each article of food that is imported or offered for import 
into the United States, except for food arriving by international mail 
or food carried by or otherwise accompanying an individual, the 
consequences are:
    (1) Inadequate prior notice--(i) No prior notice. If an article of 
food arrives at the port of arrival and no prior notice has been 
submitted and confirmed by FDA for review, the food is subject to 
refusal of admission under section 801(m)(1) of the act (21 U.S.C. 
381(m)(1)). If an article of food is refused for lack of prior notice, 
unless CBP concurrence is obtained for export and the article is 
immediately exported from the port of arrival under CBP supervision, it 
must be held within the port of entry for the article unless directed 
by CBP or FDA.
    (ii) Inaccurate prior notice. If prior notice has been submitted 
and confirmed by FDA for review, but upon review of the notice or 
examination of the article of food, the notice is determined to be 
inaccurate, the food is subject to refusal of admission under section 
801(m)(1) of the act (21 U.S.C. 381(m)(1)). If the article of food is 
refused due to inaccurate prior notice, unless CBP concurrence is 
obtained for export and the article is immediately exported from the 
port of arrival under CBP supervision, it must be held within

[[Page 59075]]

the port entry for the article unless directed by CBP or FDA.
    (iii) Untimely prior notice. If prior notice has been submitted and 
confirmed by FDA for review, but the full time that applies under Sec.  
1.279 of this subpart for prior notice has not elapsed when the article 
of food arrives, the food is subject to refusal of admission under 
section 801(m)(1) of the act (21 U.S.C. 381(m)(1)), unless FDA has 
already reviewed the prior notice, determined its response to the prior 
notice, and advised CBP of that response. If the article of food is 
refused due to untimely prior notice, unless CBP concurrence is 
obtained for export and the article is immediately exported from the 
port of arrival under CBP supervision, it must be held within the port 
of entry for the article unless directed by CBP or FDA.
    (2) Status and movement of refused food. (i) An article of food 
that has been refused under section 801(m)(1) of the act and paragraph 
(a) of this section shall be considered general order merchandise as 
described in section 490 of the Tariff Act of 1930, as amended, 19 
U.S.C. 1490.
    (ii) Refused food must be moved under appropriate custodial bond. 
FDA must be notified of the location where the food has been or will be 
moved, within 24 hours of refusal. The refused food shall not be 
entered and shall not be delivered to any importer, owner, or ultimate 
consignee. The food must be taken directly to the designated location.
    (3) Segregation of refused foods. If an article of food that is 
refused is part of a shipment that contains articles of food that have 
not been placed underhold, the refused article of food may be 
segregated from the rest of the shipment. This segregation must take 
place within the port, of arrival or where the article is held, if 
different. FDA or CBP may supervise segregation. If FDA or CBP 
determines that supervision is necessary, segregation must not take 
place without supervision.
    (4) Costs. Neither FDA nor CBP are liable for transportation, 
storage, or other expenses resulting from refusal.
    (5) Export after refusal. An article of food that has been refused 
under Sec.  1.283(a) may be exported with CBP concurrence and under CBP 
supervision unless it is seized or administratively detained by FDA or 
CBP under other authority. If an article of food that has been refused 
admission under Sec.  1.283(a) is exported, the prior notice should be 
cancelled within 5 business days of exportation.
    (6) No post-refusal submission or request for review. If an article 
of food is refused under section 801(m)(1) and no prior notice is 
submitted or resubmitted, no request for FDA review is submitted in a 
timely fashion, or export has not occurred in accordance with paragraph 
(a)(7) of this section, the article of food shall be dealt with as set 
forth in CBP regulations relating to general order merchandise (19 CFR 
part 127), except that the article may only be sold for export or 
destroyed as agreed to by CBP and FDA.
    (b) Food carried by or otherwise accompanying an individual. If 
food carried by or otherwise accompanying an individual arriving in the 
United States is not for personal use and does not have adequate prior 
notice or the individual cannot provide FDA or CBP with a copy of the 
PN confirmation, the food is subject to refusal of admission under 
section 801(m)(1) of the act. If before leaving the port, the 
individual arrange to have the food held at the port or exported, the 
article of food shall be destroyed.
    (c) Post-Refusal Prior Notice Submissions.
    (1) If an article of food is refused under Sec.  1.283(a)(1)(i) (no 
prior notice) and the food is not exported, prior notice must be 
submitted in accordance with Sec. Sec.  1.280 and 1.281(c) of this 
subpart.
    (2) If an article of food is refused under Sec.  1.283(a)(1)(ii) 
(inaccurate prior notice) and the food is not exported, you should 
cancel the prior notice in accordance with Sec.  1.282 and must 
resubmit prior notice in accordance with Sec. Sec.  1.280 and 1.281(c).
    (3) Once the prior notice has been submitted or resubmitted and 
confirmed by FDA for review, FDA will endeavor to review and respond to 
the prior notice submission within the timeframes set out in Sec.  
1.279.
    (d) FDA Review After Refusal.
    (1) If an article of food has been refused admission under section 
801(m)(1) of the act, a request may be submitted asking FDA to review 
whether the article is subject to the requirements of this subpart 
under Sec.  1.276(b)(4) or Sec.  1.277, or whether the information 
submitted in a prior notice is accurate. A request for review may not 
be used to submit prior notice or to resubmit an inaccurate prior 
notice.
    (2) A request may be submitted only by the submitter, importer, 
owner, or ultimate consignee. A request must identify which one the 
requester is.
    (3) A request must be submitted in writing to FDA and delivered by 
mail, express courier, fax, or e-mail. The location for receipt of a 
request is listed at http://www.fda.gov--see Prior Notice. A request 
must include all factual and legal information necessary for FDA to 
conduct its review. Only one request for review may be submitted for 
each refused article.
    (4) The request must be submitted within 5 calendar days of the 
refusal. FDA will review and respond within 5 calendar days of 
receiving the request.
    (5) If FDA determines that the article is not subject to the 
requirements of this subpart under Sec.  1.276(b)(5) or Sec.  1.277 or 
that the prior notice submission is accurate, it will notify the 
requester, the transmitter, and CBP that the food is no longer subject 
to refusal under section 801(m)(1) of the act.
    (e) International Mail. If an article of food arrives by 
international mail with inadequate prior notice or the PN confirmation 
number is not affixed as required, the parcel will be held by CBP for 
72 hours for FDA inspection and disposition. If FDA refuses the article 
under section 801(m) of the act and there is a return address, the 
parcel may be returned to sender stamped ``No Prior Notice--FDA 
Refused.'' If the article is refused and there is no return address or 
FDA determines that the article of food in the parcel appears to 
present a hazard, FDA may dispose of or destroy the parcel at its 
expense. If FDA does not respond within 72 hours of the CBP hold, CBP 
may return the parcel to the sender or, if there is no return address, 
destroy the parcel, at FDA expense.
    (f) Prohibitions on delivery and transfer.
    (1) Notwithstanding section 801(b) of the act, an article of food 
refused under section 801(m)(1) of the act may not be delivered to the 
importer, owner, or ultimate consignee until prior notice is submitted 
to FDA in accordance with this subpart, FDA has examined the prior 
notice, FDA has determined that the prior notice is adequate, and FDA 
has notified CBP and the transmitter that the article of food is no 
longer refused admission under section 801(m)(1).
    (2) During the time an article of food that has been refused under 
section 801(m)(1) of the act is held, the article may not be 
transferred by any person from the port or the secure facility until 
prior notice is submitted to FDA in accordance with this subpart, FDA 
has examined the prior notice, FDA has determined that the prior notice 
is adequate, and FDA has notified CBP and the transmitter that the 
article of food no longer is refused admission under section 801(m)(1). 
After this notification by FDA to CBP and transmitter, entry may be 
made in accordance with law and regulation.
    (g) Relationship to other admissibility decisions. A determination 
that an

[[Page 59076]]

article of food is no longer refused under section 801(m)(1) of the act 
is different than, and may come before, determinations of admissibility 
under other provisions of the act or other U.S. laws. A determination 
that an article of food is no longer refused under section 801(m)(1) 
does not mean that it will be granted admission under other provisions 
of the act or other U.S. laws.


Sec.  1.284  What are the other consequences of failing to submit 
adequate prior notice or otherwise failing to comply with this subpart?

    (a) The importing or offering for import into the United States of 
an article of food in violation of the requirements of section 801(m), 
including the requirements of this subpart, is a prohibited act under 
section 301(ee) of the act (21 U.S.C. 331(ee)).
    (b) Section 301 of the act (21 U.S.C. 331) prohibits the doing of 
certain acts or causing such acts to be done.
    (1) Under section 302 of the act (21 U.S.C. 332), the United States 
can bring a civil action in federal court to enjoin persons who commit 
a prohibited act.
    (2) Under section 303 of the act (21 U.S.C. 333), the United States 
can bring a criminal action in Federal court to prosecute persons who 
are responsible for the commission of a prohibited act.
    (c) Under section 306 of the act (21 U.S.C. 335a), FDA can seek 
debarment of any person who has been convicted of a felony relating to 
importation of food into the United States or any person who has 
engaged in a pattern of importing or offering adulterated food that 
presents a threat of serious adverse health consequences or death to 
humans or animals.


Sec.  1.285  What happens to food that is imported or offered for 
import from unregistered facilities that are required to register under 
21 CFR part 1, subpart H?

    (a) If an article of food from a foreign manufacturer that is not 
registered as required under section 415 of the act (21 U.S.C. 350d) 
and subpart H is imported or offered for import into the United States, 
the food is subject to refusal of admission under section 801(m)(1) of 
the act and Sec.  1.283 for failure to provide adequate prior notice. 
The failure to provide the correct registration number of the foreign 
manufacturer, if registration is required under section 415 of the act 
and 21 CFR part 1, subpart H, renders the identity of that facility 
incomplete for purposes of prior notice.
    (b) Unless CBP concurrence is obtained for export and the article 
is immediately exported from the port of arrival, if an article of food 
is imported or offered for import from a foreign facility that is not 
registered as required under section 415 of the act and is placed under 
hold, it must be held within the port of entry for the article unless 
directed by CBP or FDA.
    (c) Status and movement of held food. (1) An article of food that 
has been placed under hold under section 801(l) of the act shall be 
considered general order merchandise as described in section 490 of the 
Tariff Act of 1930, as amended (19 U.S.C. 1490).
    (2) Food under hold under section 801(l) must be moved under 
appropriate custodial bond. FDA must be notified of the location where 
the food has been or will be moved, within 24 hours of the hold. The 
food subject to hold shall not be entered and shall not be delivered to 
any importer, owner, or ultimate consignee. The food must be taken 
directly to the designated facility.
    (d) Segregation of refused foods. If an article of food that has 
been placed under hold under section 801(l) is part of a shipment that 
contains articles that have not been placed under hold of the act, the 
food under hold may be segregated from the rest of the shipment. This 
segregation must take place within the port of arrival where the 
article is held, if different. FDA or CBP may supervise segregation. If 
FDA or CBP determine that supervision is necessary, segregation must 
not take place without supervision.
    (e) Costs. Neither FDA nor CBP will be liable for transportation, 
storage, or other expenses resulting from any hold.
    (f) Export after refusal. An article of food that has been placed 
under hold under section 801(l) of the act may be exported with CBP 
concurrence and under CBP supervision unless it is seized or 
administratively detained by FDA or CBP under other authority.
    (g) No Registration or Request for Review. If an article of food is 
placed under hold under section 801(l) of the act and no registration 
or request for FDA review is submitted in a timely fashion or export 
has not occurred in accordance with subsection (g), the food shall be 
dealt with as set forth in CBP regulations relating to general order 
merchandise, except that the article may only be sold for export or 
destroyed as agreed to by CBP and FDA.
    (h) Food carried by or otherwise accompanying an individual. If an 
article of food carried by or otherwise accompanying an individual 
arriving in the United States is placed under hold under section 801(l) 
of the act because it is from a foreign facility that is not registered 
as required under section 415 of the act, 21 U.S.C. 350d, and subpart 
H, the individual may arrange to have the food held at the port or 
exported. If such arrangements cannot be made, the article of food may 
be destroyed.
    (i) Post-refusal and post-hold submissions. (1) Post-refusal. To 
resolve the refusal if an article of food is refused under Sec.  
1.283(a) because the facility is not registered, the facility must be 
registered and a registration number has been obtained, you should 
cancel the prior notice and must resubmit the prior notice in 
accordance with Sec.  1.283(c).
    (2) Post-hold. To resolve a hold, if an article of food is held 
under Sec.  1.285(b) because it is from a foreign facility that is not 
registered, the facility must be registered and a registration number 
must be obtained.
    (i) FDA must be notified of the applicable registration number in 
writing. The notification must provide the name and contact information 
for the person submitting the information. The notification may be 
delivered to FDA by mail, express courier, fax, or e-mail. The location 
for receipt of a notification of registration number associated with an 
article of food under hold is listed at http://www.fda.gov--see Food 
Facility Registration. The notification should include the applicable 
CBP identifier.
    (ii) If FDA determines that the article is no longer subject to 
hold, it will notify the person who provided the registration 
information and CBP that the food is no longer subject to hold under 
section 801(l) of the act.
    (j) FDA review after hold. (1) If an article of food has been 
placed under hold under section 801(l), a request may be submitted 
asking FDA to review whether the facility associated with the article 
is subject to the requirements of section 415 of the act. A request for 
review may not be submitted to obtain a registration number.
    (2) A request may be submitted only by the prior notice submitter, 
importer, owner, or ultimate consignee of the article. A request must 
identify which one the requestor is.
    (3) A request must be submitted in writing to FDA and delivered by 
mail, express courier, fax or e-mail. The location for receipt of a 
request is listed at http://www.fda.gov--see Prior Notice. A request 
must include all factual and legal information necessary for FDA to 
conduct its review. Only one request for review may be submitted for 
each article under hold.
    (4) The request must be submitted within 5 calendar days of the 
hold. FDA will review and respond within 5 calendar days of receiving 
the request.
    (5) If FDA determines that the article is not from a facility 
subject to the requirements of section 415, it will

[[Page 59077]]

notify the requestor and CBP that the food is no longer subject to hold 
under section 801(l) of the act.
    (k) International mail. If an article of food is that arrives by 
international mail is from a foreign facility that is not registered as 
required under section 415 of the act (21 U.S.C. 350d) and subpart H, 
the parcel will be held by CBP for 72 hours for FDA inspection and 
disposition. If the article is held under section 801(1) of the act and 
there is a return address, the parcel may be returned to sender stamped 
``No Registration--No Admission Permitted.'' If the article is under 
hold and there is no return address or FDA determines that the article 
of food is in the parcel appears to present a hazard, FDA may dispose 
of or destroy the parcel at its expense. If FDA does not respond within 
72 hours of the CBP hold, CBP may return the parcel to the sender 
stamped ``No Registration--No Admission Permitted'' or, if there is no 
return address, destroy the parcel, at FDA expense.
    (l) Prohibitions on delivery and transfer. (1) Notwithstanding 
section 801(b) of the act (21 U.S.C. 381(b)), an article of food that 
has been refused under section 801(m)(1) of the act may not be 
delivered to the importer, owner, or ultimate consignee until prior 
notice is submitted to FDA in accordance with this subpart, FDA has 
examined the prior notice, FDA has determined that the prior notice is 
adequate, and FDA has notified CBP and the transmitter that the article 
of food is no longer refused admission under section 801(m)(1) of the 
act.
    (2) During the time an article of food that has been refused under 
section 801(m)(1) of the act is held, the article may not be 
transferred by any person from the port or the secure facility location 
until prior notice is submitted to FDA in accordance with this subpart, 
FDA has examined the prior notice, FDA has determined that the prior 
notice is adequate, and FDA has notified CBP and the transmitter that 
the article of food is no longer refused admission under section 
801(m)(1) of the act. After this notification by FDA to CBP and 
transmitter, entry may be made in accordance with law and regulation.
    (m) Relationship to other admissibility provisions. A determination 
that an article of food is no longer subject to hold under section 
801(l) of the act is different than, and may come before, 
determinations of admissibility under other provisions of the act or 
other U.S. laws. A determination that an article of food is no longer 
under hold under section 801(l) does not mean that it will be granted 
admission under other provisions of the act or other U.S. laws.

    Dated: October 2, 2003.
Tommy G. Thompson,
Secretary of Health and Human Services.

    Dated: October 8, 2003.
Tom Ridge,
Secretary of Homeland Security.
[FR Doc. 03-25877 Filed 10-9-03; 8:45 am]
BILLING CODE 4160-01-P