[Federal Register Volume 70, Number 2 (Tuesday, January 4, 2005)]
[Rules and Regulations]
[Pages 459-553]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-28593]



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Part III





Department of Agriculture





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Animal and Plant Health Inspection Service



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9 CFR Parts 93, 94, 95, and 96



Bovine Spongiform Encephalopathy; Minimal-Risk Regions and Importation 
of Commodities; Final Rule and Notice

Federal Register / Vol. 70, No. 2 / Tuesday, January 4, 2005 / Rules 
and Regulations

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DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection Service

9 CFR Parts 93, 94, 95, and 96

[Docket No. 03-080-3]
RIN 0579-AB73


Bovine Spongiform Encephalopathy; Minimal-Risk Regions and 
Importation of Commodities

AGENCY: Animal and Plant Health Inspection Service, USDA.

ACTION: Final rule.

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SUMMARY: We are amending the regulations regarding the importation of 
animals and animal products to establish a category of regions that 
present a minimal risk of introducing bovine spongiform encephalopathy 
(BSE) into the United States via live ruminants and ruminant products 
and byproducts, and we are adding Canada to this category. We are also 
establishing conditions for the importation of certain live ruminants 
and ruminant products and byproducts from such regions. These actions 
will continue to protect against the introduction of BSE into the 
United States while removing unnecessary prohibitions on the 
importation of certain commodities from minimal-risk regions for BSE, 
currently only Canada.

EFFECTIVE DATE: March 7, 2005.

FOR FURTHER INFORMATION CONTACT: For information concerning ruminant 
products, contact Dr. Karen James-Preston, Director, Technical Trade 
Services, National Center for Import and Export, VS, APHIS, 4700 River 
Road Unit 38, Riverdale, MD 20737-1231; (301) 734-4356.
    For information concerning live ruminants, contact Lee Ann Thomas, 
Director, Technical Trade Services, Animals, Organisms and Vectors, and 
Select Agents, National Center for Import and Export, VS, APHIS, 4700 
River Road Unit 38, Riverdale, MD 20737-1231; (301) 734-4356.
    For other information concerning this rule, contact Dr. Gary 
Colgrove, Director, Sanitary Trade Issues Team, National Center for 
Import and Export, VS, APHIS, 4700 River Road Unit 38, Riverdale, MD 
20737-1231; (301) 734-4356.

SUPPLEMENTARY INFORMATION:

I. Purpose

    This document makes final, with changes, a proposed rule that the 
Animal and Plant Health Inspection Service (APHIS) of the U.S. 
Department of Agriculture (USDA or the Department) published in the 
Federal Register on November 4, 2003 (68 FR 62386-62405, Docket No. 03-
080-1). In that document, we proposed to establish a category of 
regions that present a minimal risk of introducing bovine spongiform 
encephalopathy (BSE) into the United States via live ruminants and 
ruminant products and byproducts, and to add Canada to this category. 
The proposal also set forth conditions for the importation of certain 
live ruminants and ruminant products and byproducts from BSE minimal-
risk regions. We solicited public comment on the proposed rule and its 
underlying risk analysis and other supporting analyses for 60 days 
ending on January 5, 2004. At the time the proposed rule was published, 
BSE had never been detected in a native animal in the United States and 
only a single case in a native animal had been reported in Canada (in 
Alberta in May 2003). In December 2003, BSE was detected in an imported 
dairy cow in Washington State. This document describes the course of 
this rulemaking before and after the detection in Washington State, 
including how the rulemaking was affected by additional BSE-related 
safeguards imposed by USDA's Food Safety and Inspection Service (FSIS) 
in January 2004. It also responds to public comments received on the 
proposed rule and its underlying risk analysis and other supporting 
analyses, both before the original closing date on January 5, 2004, and 
during an extended comment period that closed on April 7, 2004, and 
explains the changes we are making in this final rule.

II. Summary of Changes Made in This Final Rule

    Based on our continued analysis of the issues and on information 
provided by commenters, we have made certain changes in this final rule 
from the provisions we proposed in November 2003, as supplemented by 
our March 2003 notice of the extension of the comment period. Those 
changes, summarized in the list below, are discussed in detail in our 
responses to comments.
    1. For bovines imported from a BSE minimal-risk region for feeding 
and then slaughter (referred to as feeder cattle), we are making the 
following changes:
     We are requiring that feeder cattle be permanently marked 
before entry as to country of origin with a brand or other means of 
identification approved by the Administrator, rather than by an ear 
tattoo as proposed. Feeder cattle imported from Canada must be marked 
with ``C[and]N.''
     We are requiring that feeder cattle be individually 
identified before entry by an eartag that allows the animal to be 
traced back to the premises of origin and are specifying that the 
eartag may not be removed until the animal is slaughtered.
     We are requiring that the animal health certification 
currently required under existing Sec.  93.405 for certain live animals 
imported into the United States include, for feeder cattle imported 
from a BSE minimal-risk region, additional information relating to 
animal identification, origin, destination, and responsible parties.
     We are requiring that feeder cattle be moved from the port 
of entry to a feedlot in a sealed means of conveyance and then from the 
feedlot to a recognized slaughtering establishment in a sealed means of 
conveyance. The cattle may not be moved to more than one feedlot.
     When referring to the destination of feeder cattle 
imported into the United States, we are using the terminology ``the 
feedlot identified on the APHIS Form VS 17-130'' rather than 
``designated feedlot.''
     We are specifying that the physical location of the 
feedlot of destination and the person responsible for movement of the 
cattle be identified on the documentation required for movement from 
the port of entry to the feedlot.
    2. For sheep and goats imported from a BSE minimal-risk region for 
feeding and then slaughter (referred to as ``feeder sheep and goats'') 
we are making the following changes:
     As with cattle, we are requiring that feeder sheep and 
goats be permanently marked before entry as to country of origin (with 
the requirements for marking modified as appropriate for sheep and 
goats). Feeder sheep and goats imported from Canada must be marked with 
``C.''
     As with cattle, we are requiring that feeder sheep and 
goats be individually identified before entry by an eartag that allows 
the animal to be traced back to the premises of origin and are 
specifying that the eartag may not be removed until the animal is 
slaughtered.
     We are continuing to refer to the feedlot of destination 
for feeder sheep and goats as a ``designated feedlot'' and are adding 
criteria for such feedlots. The sheep and goats may not be moved to 
more than one designated feedlot.
     We are requiring the same additional information on the 
health certification required under Sec.  93.405 as described above for 
feeder cattle.
     We are requiring that feeder sheep and goats be moved from 
the port of entry to a designated feedlot as a group in a sealed means 
of conveyance, not be

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commingled with any sheep or goats that are not being moved directly to 
slaughter from the designated feedlot at less than 12 months of age, 
and be moved from the designated feedlot to a recognized slaughtering 
establishment in a sealed means of conveyance.
    3. For sheep and goats imported from a BSE minimal-risk region for 
immediate slaughter, we are prohibiting the importation of sheep and 
goats that are positive, suspect, or susceptible for TSEs.
    4. We are moving the provisions for the importation of feeder sheep 
and goats from Canada from proposed Sec.  93.436 to Sec.  93.405 and 
Sec.  93.419.
    5. We are moving the provisions for the importation of sheep and 
goats from Canada for immediate slaughter from proposed Sec.  93.436 to 
Sec.  93.419 and Sec.  93.420.
    6. We are clarifying in Sec.  93.420 that all ruminants imported 
from Canada for immediate slaughter must be moved to a recognized 
slaughtering establishment in a sealed means of conveyance.
    7. We are not specifying in our regulations that the intestines 
from bovines imported from Canada be removed at slaughter in the United 
States and be disposed of in a manner approved by the Administrator.
    8. We are not including any import restrictions because of BSE for 
live cervids (e.g., deer, elk) and cervid products from a BSE minimal-
risk region.
    9. We are specifying that there are no import restrictions because 
of BSE for camelids (i.e., llamas, alpacas, guanacos, and vicunas) from 
a BSE minimal-risk region.
    10. We are also providing in Sec.  94.18 for the overland 
transiting of products derived from bovines, sheep, and goats from a 
BSE minimal-risk region that are eligible for entry into the United 
States. Additionally, we are clarifying that the existing provisions in 
Sec.  94.18 for the transiting of ruminant products from regions in 
which BSE exists or that pose an undue risk of BSE apply only to 
transiting at air or sea ports.
    11. We are requiring that bovines, sheep, and goats imported from a 
BSE minimal-risk region be subject to a ruminant feed ban equivalent to 
requirements established by Food and Drug Administration (FDA) of the 
U.S. Department of Health and Human Services at 21 CFR 589.2000. This 
is a change from our proposal that the ruminants ``are not known to 
have been fed ruminant protein, other than milk protein.''
    12. In the definition of bovine spongiform encephalopathy (BSE) 
minimal-risk region, we are rewording the factor that said a BSE 
minimal-risk region is one that has ``a ban on the feeding of ruminant 
protein to ruminants that appears to be an effective barrier to the 
dissemination of the BSE infectious agent, with no evidence of 
significant noncompliance with the ban'' to say instead that the region 
is one in which ``a ruminant-to-ruminant feed ban is in place and is 
effectively enforced.''
    13. We are providing that meat, meat byproducts, and meat food 
products derived from bovines from a BSE minimal-risk region may not be 
imported into the United States unless an air-injected stunning process 
was not used at slaughter and unless the specified risk materials 
(SRMs) and the small intestine were removed in the exporting region, 
consistent with the FSIS regulations at 9 CFR 313.15 and 310.22 for 
stunning and processing in the United States. We are defining SRMs as 
those materials designated as such by FSIS in 9 CFR 310.22, to include 
the brain, skull, eyes, trigeminal ganglia, spinal cord, vertebral 
column (excluding the vertebrae of the tail, the transverse process of 
the thoracic and lumbar vertebrae, and the wings of the sacrum), and 
dorsal root ganglia of cattle 30 months of age and older, and the 
tonsils and distal ileum of the small intestine of all cattle.
    14. We are removing the proposed requirement that imported meat 
derived from bovines from BSE minimal-risk regions be derived only from 
animals less than 30 months of age when slaughtered.
    15. We are removing the proposed requirement that meat derived from 
bovines in a BSE minimal-risk region that are slaughtered in that 
region come from animals slaughtered at a facility that either 
slaughters only bovines less than 30 months of age or complies with an 
approved segregation process.
    16. We are clarifying that the final rule applies to ``meat,'' 
``meat byproducts,'' and ``meat food products'' as defined by FSIS.
    17. We are removing the requirement that hunter-harvested meat be 
accompanied by a certificate of the national government of Canada.
    18. We are clarifying the type of ruminant offal from a BSE 
minimal-risk region that is allowed importation into the United States.
    19. We are providing that tallow may be imported from a BSE 
minimal-risk region provided the tallow is composed of less than 0.15 
percent insoluble impurities and is not commingled with any other 
material of animal origin.
    20. We are providing that, except for gelatin allowed importation 
under Sec.  94.18(c), gelatin imported from a BSE minimal-risk region 
must be derived from the bones of bovines that were subject to a 
ruminant feed ban equivalent to the requirements established by FDA at 
21 CFR 589.2000 and from which SRMs were removed.
    21. We are providing that sheep casings may be imported from a BSE 
minimal-risk region provided the sheep from which the casings were 
derived were less than 12 months of age when slaughtered and were 
subject to a ruminant feed ban equivalent to that of FDA at 21 CFR 
589.2000.
    22. We are adding and revising definitions in this final rule to 
clarify the meaning of certain terms used in the rule.

III. Background

A. Bovine Spongiform Encephalopathy

    APHIS regulates the importation of animals and animal products into 
the United States to guard against the introduction of various animal 
diseases, including BSE. The regulations are contained in 9 CFR parts 
92, 93, 94, 95, and 96.
    BSE is a progressive and fatal neurological disorder of cattle that 
results from an unconventional transmissible agent. BSE belongs to the 
family of diseases known as transmissible spongiform encephalopathies 
(TSEs). In addition to BSE, TSEs include, among other diseases, scrapie 
in sheep and goats, chronic wasting disease (CWD) in deer and elk, and 
variant Creutzfeldt-Jakob disease in humans. The agent that causes BSE 
and other TSEs has yet to be fully characterized. The theory that is 
most accepted in the scientific community is that the agent is a prion, 
which is an abnormal form of a normal protein known as cellular prion 
protein. The BSE agent does not evoke any demonstrated immune response 
or inflammatory reaction in host animals. BSE is confirmed by 
postmortem microscopic examination of an animal's brain tissue or by 
detection of the abnormal form of the prion protein in an animal's 
brain tissues. The pathogenic form of the protein is both less soluble 
and more resistant to degradation than the normal form. The BSE agent 
is extremely resistant to heat and to normal sterilization processes. 
BSE is spread to cattle primarily through the consumption of animal 
feed containing protein from ruminants infected with BSE.
    BSE was first diagnosed in 1986 in the United Kingdom. Since then, 
there have been more than 187,000 confirmed cases of BSE in cattle 
worldwide. The disease

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has been confirmed in native-born cattle in 20 European countries in 
addition to the United Kingdom, and in some non-European countries, 
including Japan, Israel, and Canada. Over 95 percent of all BSE cases 
have occurred in the United Kingdom, where the epidemic peaked in 1992/
1993. Agricultural officials in the United Kingdom have taken a series 
of actions to mitigate BSE, including making it a reportable disease, 
banning mammalian meat-and-bone meal in feed for all food-producing 
animals, prohibiting the inclusion of animals more than 30 months of 
age in the animal and human food chains, and destroying all animals 
showing signs of BSE and other potentially exposed animals at high risk 
of developing the disease. As a result of these actions, most notably 
the feed bans, the annual incidence of BSE in the United Kingdom has 
fallen dramatically. The figure below illustrates the downward trend in 
BSE cases among cattle born after implementation of the feed ban.
[GRAPHIC] [TIFF OMITTED] TR04JA05.010

    Variant Creutzfeld-Jakob disease (vCJD), a chronic and fatal 
neurodegenerative disease of humans, has been linked via scientific and 
epidemiological studies to exposure to the BSE agent, most likely 
through consumption of cattle products contaminated with the BSE agent. 
To date, since vCJD was first identified in 1996, approximately 150 
probable and confirmed cases of vCJD have been identified. The majority 
of these cases have either been identified in the United Kingdom or 
were linked to exposure that occurred in the United Kingdom, and all 
cases have been linked to exposure in countries with native cases of 
BSE. Some studies estimate that more than 1 million cattle may have 
been infected with BSE throughout the epidemic in the United Kingdom. 
This number of infected cattle could have introduced a significant 
amount of infectivity into the human food supply. Yet, the number of 
cases of vCJD identified to date suggest a substantial species barrier 
that may protect humans from widespread illness due to BSE.

B. APHIS' Regulatory Approach to BSE: Past and Present

    Since 1989 APHIS has prohibited the importation of live cattle and 
other ruminants and certain ruminant products, including most rendered 
protein products, into the United States from countries where BSE is 
known to exist. In 1997, due to concerns about widespread risk factors 
and inadequate surveillance for BSE in many European countries, APHIS 
added an additional classification of countries as regions of undue 
risk for BSE and extended importation restrictions on ruminants and 
ruminant products to all of the countries in Europe. In December 2000, 
APHIS expanded its prohibitions on imports of rendered ruminant protein 
products from BSE-restricted regions to include rendered protein 
products of any animal species, due to concern that cattle feed 
supposedly free of ruminant protein may have been cross-contaminated 
with the BSE agent. The same importation restrictions apply to regions 
where BSE has been confirmed in a native animal and regions that 
present an undue risk of BSE because of import requirements less 
restrictive than those that would be acceptable for import into the 
United States and/or because of inadequate surveillance (9 CFR 94.18).
    In effect then, until implementation of this final rule, countries 
have fallen into one of three categories with regard to BSE:
     Regions in which BSE is known to exist;
     Regions that present an undue risk of BSE because of 
import requirements less restrictive than those that would be 
acceptable for import into the United States and/or because of 
inadequate surveillance; and
     Regions that do not fall into either of the above two 
categories.
    This regulatory framework recognized only two risk situations--
those regions considered free of BSE and those regions considered to 
present a BSE risk--and prohibited the importation of live ruminants 
and most ruminant products from those regions considered to present a 
BSE risk.
    In our November 2003 proposed rule, we explained that we believed 
it was appropriate to establish an additional category of regions with 
regard to BSE--the BSE minimal-risk region. We stated that regions that 
could be eligible for a minimal-risk classification would be (1) those 
regions in which a BSE-infected animal has been diagnosed, but in which 
measures have been taken that make it unlikely that BSE would be 
introduced from that region into the United States, and (2) those 
regions that cannot be considered BSE-free even though BSE has not been 
detected, but that have taken sufficient measures to be

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considered minimal risk. We proposed to add Canada to the new BSE 
minimal-risk category and also proposed conditions for the importation 
of certain live ruminants and ruminant products and byproducts from BSE 
minimal-risk regions.
    Our proposed definition of BSE minimal-risk regions included the 
standards we would use to evaluate the BSE risk from a region and to 
classify a region as one of minimal risk for BSE. To qualify as a BSE 
minimal-risk region, we proposed that a region be one that meets the 
following standards:
    1. The region maintains and, in the case of regions where BSE was 
detected, had in place prior to the detection of BSE, risk mitigation 
measures adequate to prevent widespread exposure and/or establishment 
of the disease. Such measures include the following:
     Restrictions on the importation of animals sufficient to 
minimize the possibility of infected ruminants being imported into the 
region, and on the importation of animal products and animal feed 
containing ruminant protein sufficient to minimize the possibility of 
ruminants in the region being exposed to BSE;
     Surveillance for BSE at levels that meet or exceed 
recommendations of the Office International des Epizooties (OIE, also 
now referred to as the World Organisation for Animal Health) for 
surveillance for BSE; and
     A ban on the feeding of ruminant protein to ruminants that 
appears to be an effective barrier to the dissemination of the BSE 
agent, with no evidence of significant noncompliance with the ban.
    2. In regions where BSE was detected, the region conducted an 
epidemiological investigation following detection of BSE sufficient to 
confirm the adequacy of measures to prevent the further introduction or 
spread of BSE, and continues to take such measures.
    3. In regions where BSE was detected, the region took additional 
risk mitigation measures, as necessary, following the BSE outbreak 
based on risk analysis of the outbreak, and continues to take such 
measures.
    We stated in our proposal that we would use these standards as a 
combined and integrated evaluation tool, basing a BSE minimal-risk 
classification on the overall effectiveness of control mechanisms in 
place (e.g., surveillance, import controls, and a ban on the feeding of 
ruminant protein to ruminants). We noted that this approach would 
differ from some of the numerical guidelines specified by OIE in its 
recommendations for a BSE minimal-risk country or zone (discussed 
below).
Basis for Focused Regulatory Restrictions
    Our proposed rule was based on a number of considerations. A 
significant amount of research has been conducted on BSE since the 
disease was initially identified and since we first established our 
regulatory framework to protect against the introduction of BSE. 
(Please note: In this final rule, we use the term ``importation'' to 
mean the movement of animals or products into the United States or 
another country and the term ``introduction'' to mean the movement of a 
disease agent into the United States or another country.)
    While there are many unanswered questions, both research studies 
and field epidemiological experience have demonstrated effective 
control measures to prevent spread of this disease. Ongoing studies 
have identified specific tissues where the majority of infectivity 
appears to reside, so that these tissues can be removed from the food 
chain. Early epidemiological work identified contaminated feed as the 
primary method of spread of the disease between animals. Continued 
monitoring and surveillance in Europe--where the exposure is assumed to 
be the highest--have demonstrated the effectiveness of control measures 
that have been enacted, such as feed bans that prevent the recycling of 
the agent. This increased body of knowledge provides a sound and 
compelling scientific basis for more focused regulatory restrictions 
with regard to BSE than those we have been operating under.
    A more focused approach is also supported by the international 
community, as evidenced by the evolution of BSE guidelines adopted by 
the OIE (Ref 1). The OIE is recognized by the World Trade Organization 
(WTO) as the international organization responsible for development and 
periodic review of standards, guidelines, and recommendations with 
respect to animal health and zoonoses (diseases that are transmissible 
from animals to humans). The OIE guidelines for trade in terrestrial 
animals (mammals, birds, and bees) are detailed in the Terrestrial 
Animal Health Code (Ref 2). The OIE guidelines on BSE, contained in 
Chapter 2.3.13 of the Terrestrial Animal Health Code, and supplemented 
by Appendix 3.8.4 of the Code, currently provide for five possible BSE 
classifications for regions. For each classification, the guidelines 
recommend different export conditions for live animals and products, 
based on the risk presented by the region. This framework not only 
recognizes different levels of risk among regions, but provides for 
trade in live animals and products under certain conditions even from 
regions considered high-risk under the OIE guidelines.
    As a member of the OIE, the United States, represented by APHIS, 
has been actively involved in the development of OIE guidelines and 
fully supports the OIE position that gradations in BSE risk among 
regions should be recognized and that trade should be commensurate with 
risk. Although APHIS did not incorporate the text of OIE's BSE 
guidelines into its proposed rule, the agency based its standards on 
these guidelines. The standards contain the same basic factors for 
assessing a region's BSE status as the OIE guidelines (e.g., import 
requirements, incidence, surveillance, feed restrictions, etc.). APHIS 
also considered the OIE guidelines, in conjunction with other relevant 
factors and available information, when evaluating Canada as a BSE 
minimal-risk region, and will do so in the future in evaluating other 
countries that may apply for minimal-risk status under our regulations. 
It is in this context that APHIS' standards and the OIE guidelines 
should be viewed.
    We believe it is important to explain the relationship of our 
standards to the OIE guidelines because a number of commenters 
questioned why we did not adopt the OIE guidelines outright and/or 
assumed that differences in text meant that APHIS had rejected the OIE 
guidelines. While there are differences between the APHIS standards and 
the OIE guidelines, these differences reflect the different purposes 
and uses of the OIE guidelines and our standards.
    The OIE guidelines are designed to provide a science-based 
reference document for international trade in animals and animal 
products. To this end, the OIE Terrestrial Animal Health Standards 
Commission draws upon the expertise of internationally renowned 
specialists to draft new and revised articles of the Terrestrial Code 
in light of advances in veterinary science. Draft texts are circulated 
to member countries for review and comment and, as a general rule, are 
adopted based on consensus of the OIE membership. Articles adopted by 
the membership provide guidance for use by veterinary authorities, 
import/export services, epidemiologists and all those involved in 
international trade. OIE guidelines are not intended to be 
prescriptive; each member nation may determine its own appropriate 
level of protection and, therefore, establish its own import 
requirements. (In accordance with Article 5 of the WTO ``Agreement on 
the Application of Sanitary and

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Phytosanitary Measures'' (WTO-SPS Agreement), WTO members are obligated 
to base their import requirements on an assessment of risk, taking into 
account the standards, guidelines, and recommendations, and the risk 
assessment techniques developed by the relevant international 
organizations.)
    Regulations, which may be based on the OIE guidelines, are 
prescriptive, as they are intended to be enforced as written and are 
not designed to be a point of reference. Furthermore, because 
rulemaking may take considerable time, the most successful regulations 
must also be flexible enough to allow a country to consider individual 
circumstances among its trading partners, as well as changes in 
science, without undergoing constant revisions. One reason that APHIS 
has decided not to simply adopt the OIE guidelines as regulations is 
that they are constantly evolving and subject to change. Some chapters, 
in fact, such as the one on BSE, are continually being updated as new 
information becomes available. For example, the OIE is currently 
considering proposing a three-tier country classification system for 
BSE as an alternative to the existing five-tier system. In 2004, the 
OIE changed the recommended reported incidence rate for minimal-risk 
regions from less than 1 case per million during each of the last four 
consecutive 12-month periods within the cattle population over 24 
months of age to less than 2 cases per million during that time period 
within that cattle population. This example of a numeric threshold 
points to another reason that APHIS chose not to adopt the OIE 
guidelines as regulations. In some cases, holding a country to a rigid 
criterion without consideration of compensatory risk reduction measures 
may not be scientifically justified and unfairly discriminate against 
regions where the overall conditions indicate equivalence with minimal 
BSE risk. In other cases, rigidly applying a numeric criterion without 
a thorough consideration and evaluation of relevant factors (e.g., the 
quality of a country's surveillance program and the supporting 
veterinary infrastructure) could result in trade with a region that may 
meet OIE guidelines but, nonetheless, present, in our view, an undue 
risk of BSE introduction. Therefore, rather than incorporate the text 
of the OIE guidelines into our regulations, APHIS chose to base its 
evaluation on OIE guidelines in a way that allows us to consider an 
individual country's specific situation and to analyze risk based on 
the overall effectiveness of actions taken by the country to prevent 
the introduction and spread of BSE.
    As stated above, APHIS considered the OIE guidelines in evaluating 
whether Canada met our proposed standards, and we plan to consider them 
in assessing whether other countries that may apply for minimal-risk 
classification meet our standards. To illustrate how we would use the 
OIE guidelines for minimal-risk regions in applying our own standards, 
we can look to our evaluation of the incidence of BSE with respect to 
Canada. Although APHIS' standards do not include a numerical threshold 
for incidence, our standards provide that a region must have in place 
risk mitigation measures adequate to prevent widespread exposure and/or 
establishment of the disease. In concluding that measures taken in 
Canada had prevented widespread exposure and/or establishment, we 
compared Canada's incidence rate of two infected cattle in 2003 out of 
a population of 5.5 million cattle over 24 months of age with OIE's 
recommendation of less than two infected cattle per million during each 
of the last four consecutive 12-month periods within the cattle 
population over 24 months of age. Canada's incidence rate (0.4 per 
million head of adult cattle) is well below the current OIE 
recommendation regarding incidence in minimal-risk regions. We also 
considered that the reported rate of disease cannot be considered 
independently from either the level and quality of disease surveillance 
or from the position on the epidemic curve. In this regard, we note 
that Canada exceeds the OIE recommended level of testing. We also 
consider Canada's surveillance program for BSE in cattle to be of high 
quality because it includes active surveillance for BSE in cattle that 
is appropriately targeted based on known risk factors. Also, because 
Canada implemented import restrictions and a feed ban before detection 
of BSE in any indigenous animals, it is more likely that the incidence 
of BSE in Canada is decreasing (on the down slope of the epidemic 
curve), rather than increasing (on the up slope).
The November 2003 Proposed Rule
    As explained above, our proposed standards for minimal-risk regions 
were based on the OIE guidelines for BSE minimal-risk regions, using 
those guidelines as a reference. We based our proposed classification 
of Canada as a minimal-risk region, as well as our proposed mitigation 
measures for live ruminants and ruminant products and byproducts from 
Canada, on an analysis of risk APHIS prepared entitled, ``Risk 
Analysis: BSE Risk from Importation of Designated Ruminants and 
Ruminant Products from Canada into the United States.'' The analysis 
drew on a number of sources of information, including scientific 
literature, results of epidemiological investigations, data provided by 
the Canadian Government, a quantitative analysis (i.e., uses numerical 
values) of the risk of BSE in Canada prepared by the Canadian Food 
Inspection Agency (CFIA), and quantitative analyses of the consequences 
of BSE being introduced into the United States prepared by the Harvard 
Center for Risk Analysis at Harvard University (HCRA) and the Center 
for Computational Epidemiology at Tuskegee University (Ref 3) 
(discussed in more detail below under the heading ``Harvard-Tuskegee 
Investigation of BSE Risk in the United States''). This analysis was 
made available to the public when the proposed rule was published in 
November 2003.
    We solicited public comment on the proposed rule and its underlying 
risk analysis and other supporting analyses for 60 days ending on 
January 5, 2004. As noted, at the time the proposed rule was published, 
BSE had never been detected in a native animal in the United States, 
and only a single case in a native animal had been reported in Canada 
(in Alberta in May 2003).
The Reopening of the Comment Period and Explanatory Note
    On December 23, 2003, less than 2 weeks before the close of the 
comment period for our proposed rule, USDA announced a presumptive 
positive case of BSE in a dairy cow in Washington State. Samples had 
been taken from the cow on December 9 as part of USDA's BSE 
surveillance program. The BSE diagnosis was made on December 22 and 23 
by histopathology and immunohistochemical testing at the National 
Veterinary Services Laboratories in Ames, IA, and was verified on 
December 25 by the international reference laboratory, the Veterinary 
Laboratories Agency in Weybridge, England.
    Upon detection of the BSE-positive cow in Washington State, USDA, 
FDA, and other Federal and State agencies, along with CFIA, immediately 
began working together to perform an epidemiological investigation (Ref 
4), trace any potentially infected cattle, trace potentially 
contaminated rendered product, increase BSE surveillance, and take 
additional measures to address human and animal health.

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    The epidemiological investigation and DNA test results confirmed 
that the infected cow was not indigenous to the United States, but 
rather was born and most likely became infected in Alberta, Canada, 
before Canada's 1997 implementation of a ban on feeding mammalian 
protein to ruminants.
    Following detection of the imported BSE-infected cow in Washington 
State in December 2003, further safeguards on human and animal health 
were implemented in the United States by FDA and FSIS. These actions 
are described in more detail below under the headings ``Measures 
Implemented by FSIS'' and ``Measures Implemented by FDA.''
    In response to comments from the public requesting an extension of 
the comment period and in order to give the public an additional 
opportunity to comment on the proposed rule in light of these 
developments, on March 8, 2004, we published a notice in the Federal 
Register (69 FR 10633-10636, Docket No. 03-080-2) reopening and 
extending the comment period until April 7, 2004. The notice also 
announced the availability of a document titled ``Explanatory Note'' 
that discussed each component of the original risk analysis and related 
information in light of the new BSE case. (You may view the Explanatory 
Note document on the Internet by accessing the APHIS Web site at http://www.aphis.usda.gov/lpa/issues/bse/bse.html. Click on the document 
titled ``Analysis of Risk--Update for the Final Rule: Bovine Spongiform 
Encephalopathy; Minimal Risk Regions and Importation of Commodities, 
December 2004.'')
    The Explanatory Note stated that APHIS did not consider the 
detection of a second BSE case to have an effect on the conclusions of 
the original risk analysis and explained why. The original risk 
analysis addressed the likelihood that animals might have been infected 
before Canada implemented its feed ban in 1997 and also concluded that 
compliance with the feed ban in Canada would have minimized the 
likelihood of infectivity from these animals spreading to other 
ruminants in Canada.
    As noted above, the epidemiological investigation and DNA test 
results indicated that the infected cow most likely became infected 
before Canada's 1997 implementation of a ban on feeding mammalian 
protein to ruminants. Both animals diagnosed with BSE were older than 
30 months of age. The cow found to have BSE in December 2003 also was 
imported into the United States when it was older than 30 months; the 
proposed rule would not have allowed the importation of cattle 30 
months of age or older.
    The Explanatory Note observed further that, although an additional 
animal of Canadian origin had been diagnosed with BSE since the time 
APHIS published its November 2003 proposed rule and risk analysis, the 
fact remained that only two cases of BSE had been detected in animals 
born in Canada. The Explanatory Note also discussed the additional BSE 
control measures taken by Canada after BSE had been detected in that 
country.
    The March 2004 notice that reopened and extended the comment period 
on our proposed rule also proposed allowing the importation of beef 
from Canada, regardless of the age of the cattle from which it was 
derived, provided other specified mitigating conditions were met, and 
invited comment on this change from our November 2003 proposal. The 
original proposal would have required the beef to come from cattle that 
were less than 30 months of age at the time of slaughter.
    We explained in the notice that the change in our thinking was 
based on the changes FSIS made in its regulations in January 2004, and 
the fact that Canada had also implemented the changes made by FSIS. 
Among other things, FSIS required that cattle tissues considered at 
particular risk of containing the BSE agent in infected animals 
(referred to as ``specified risk materials'' or SRMs) be removed from 
cattle at slaughter and prohibited their use in human food. FSIS 
designated as SRMs the brain, skull, eyes, trigeminal ganglia, spinal 
cord, vertebral column (excluding the vertebrae of the tail, the 
transverse process of the thoracic and lumbar vertebrae, and the wings 
of the sacrum), and dorsal root ganglia of cattle 30 months of age and 
older, and the tonsils and distal ileum of the small intestine of all 
cattle. To ensure effective removal of the distal ileum, FSIS also 
required that the entire small intestine be removed and be disposed of 
as inedible. FSIS did not restrict the age of cattle eligible for 
slaughter, because the removal of SRMs effectively mitigates the BSE 
risk to humans associated with cattle that pass both ante-mortem and 
post-mortem inspections (i.e., apparently healthy cattle); FSIS and FDA 
regulations prohibit the use of other cattle in human food. The 
Canadian Government had already established equivalent safeguards in 
Canada in July 2003. In addition, because regions wishing to export 
meat and meat products to the United States must follow processing 
practices equivalent to those of FSIS, the FSIS requirements 
effectively require removal of SRMs from all cattle slaughtered outside 
the United States when meat derived from those cattle is intended for 
export to the United States, which would prevent such materials from 
entering the food chain in the United States. Additionally, FDA's feed 
ban prohibits ruminant protein from entering the ruminant feed chain. 
Therefore, we stated in our notice that we did not believe it was 
necessary to require that beef imported from BSE minimal-risk regions 
be derived from cattle under 30 months of age, provided measures 
equivalent to those of FSIS regarding SRM removal are in place in the 
exporting region and provided such other measures as are necessary 
(e.g., a prohibition on the use of air injection stunning devices, 
controls to prevent cross-contamination) are in place.
    We received a total of 3,379 comments on the proposed rule from the 
public by the close of the comment period on April 7, 2004.

C. Background Information for APHIS' Response to Comments

    Before discussing the comments received, we consider it useful to 
discuss a number of documents and actions that contributed to the basis 
for our establishment of a BSE minimal-risk region category and our 
inclusion of Canada in that category. These include: Measures 
implemented by FSIS and FDA to further reduce BSE risk in the United 
States; the Harvard-Tuskegee investigations of BSE risk in the United 
States; a memorandum from Joshua Cohen and George Gray of the HCRA; 
measures taken in Canada in response to BSE risk prior to May 2003; a 
2002 Canadian assessment of BSE risk in that country; the 
epidemiological investigation and a report by an international review 
team following the diagnosis of BSE in a cow in Canada in May 2003; 
additional measures taken in Canada; and an update to the APHIS 
analysis of the risk of allowing the importation of ruminants and 
ruminant products and byproducts from Canada.
Roles of Different Agencies
    Protecting human and animal health from the risks of BSE is carried 
out on the Federal level primarily by APHIS regarding animal health and 
FSIS regarding food safety, in coordination with the following FDA 
Centers: The Center for Veterinary Medicine regarding animal feed; the 
Center for Food Safety and Applied Nutrition regarding foods other than 
meat, poultry, and egg products; and other Centers regarding drugs, 
biologics, and

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devices containing bovine material. These agencies collaborate, issuing 
regulations under their respective authorities, to implement a 
coordinated U.S. response to BSE.
    APHIS is promulgating this final rule under the authority of the 
Animal Health Protection Act, which gives the Secretary broad 
discretion to regulate the importation of animals and animal products 
when he or she determines it to be necessary. As discussed below, FSIS 
and FDA have recently published regulations regarding BSE to protect 
human health. Because of the specific focus of each of these three 
agencies, provisions for similar products may sometimes differ slightly 
in the agencies' respective regulations as appropriate based on the 
intended consumer.
Measures Implemented by FSIS
    FSIS, in a series of three interim final rules that were published 
and made effective on January 12, 2004, took additional measures to 
prevent the BSE agent from entering the human food supply. In its 
interim final rule titled, ``Prohibition on the Use of Specified Risk 
Materials for Human Food and Requirements for the Disposition of Non-
Ambulatory Disabled Cattle'' (FSIS Docket No. 03-025IF; 69 FR 1861), 
and referred to below as the SRM rule, FSIS designated certain cattle 
tissues as SRMs and prohibited their use in human food. As noted 
earlier, FSIS designated as SRMs the brain, skull, eyes, trigeminal 
ganglia, spinal cord, vertebral column (excluding the vertebrae of the 
tail, the transverse process of the thoracic and lumbar vertebrae, and 
the wings of the sacrum), and dorsal root ganglia of cattle 30 months 
of age and older, and the tonsils and distal ileum of the small 
intestine of all cattle as SRMs. FSIS also required removal of the 
entire small intestine and disposal of it as inedible to ensure 
effective removal of the distal ileum.
    To facilitate enforcement of the SRM rule, FSIS has developed 
procedures to verify the approximate age of cattle that are slaughtered 
in official establishments. Such procedures, based on records or 
examination of teeth, are intended to ensure that SRMs from cattle 30 
months of age and older are effectively segregated from edible 
materials (Ref 5).
    As provided by the SRM rule, materials designated as SRMs if they 
are from cattle 30 months of age and older will be deemed to be SRMs 
unless the establishment can demonstrate that they are from an animal 
that was younger than 30 months of age at the time of slaughter.
    Further, FSIS developed procedures to verify that cross-
contamination of edible tissue with SRMs is reduced to the maximum 
extent practical in facilities that slaughter cattle or process 
carcasses or parts of carcasses of cattle, for cattle both younger than 
30 months of age and 30 months of age and older (Ref 5).
    The SRM rule also declared mechanically separated beef (MS(beef)) 
to be inedible and prohibited its use for human food. Additionally, the 
SRM rule prohibited all non-ambulatory disabled cattle for use as human 
food.
    The second interim final rule, titled ``Meat Produced by Advanced 
Meat/Bone Separation Machinery and Meat Recovery (AMR) Systems'' (FSIS 
Docket No. 03-038IF; 69 FR 1874-1885), prohibited products produced by 
advanced meat recovery (AMR) systems from being labeled as ``meat'' if, 
among other things, they contain central nervous system (CNS) tissue. 
AMR is a technology that enables processors to remove the attached 
skeletal muscle tissue from livestock bones without incorporating 
significant amounts of bone and bone products into the final meat 
product. FSIS had previously established and enforced regulations that 
prohibited spinal cord from being included in products labeled 
``meat.'' The interim final rule expanded that prohibition to include 
dorsal root ganglia (DRG)--clusters of CNS tissue connected to the 
spinal cord along the vertebral column. In addition, because the 
vertebral column and skull of cattle 30 months of age and older have 
been designated as SRMs, they cannot be used for AMR. Because they are 
not SRMs, the skull and vertebral column from cattle younger than 30 
months of age are allowed to be used in AMR systems. However, 
establishments that use skulls and vertebral columns in the production 
of beef AMR product must be able to demonstrate that such materials are 
from cattle younger than 30 months of age.
    The third interim final rule, titled ``Prohibition on the Use of 
Certain Stunning Devices Used to Immobilize Cattle During Slaughter'' 
(FSIS Docket No. 01-0331IF; 69 FR 1885-1891), prohibited the use of 
penetrative captive bolt stunning devices that deliberately inject air 
into the cranial cavity of cattle, because the use of such devices may 
force large fragments of CNS tissue into the circulatory system of 
stunned cattle where the fragments may become lodged in edible tissues.
    Also on January 12, 2004, FSIS published a notice, ``Bovine 
Spongiform Encephalopathy Surveillance Program,'' announcing it would 
no longer pass and apply the mark of inspection to carcasses and parts 
of cattle selected for BSE testing by APHIS until the sample testing 
has been completed, and the result is negative (FSIS Docket No. 03-
048N; 69 FR 1892).
Measures Implemented by FDA
    FDA, like FSIS, has taken additional measures to prevent the BSE 
agent from entering the human food supply. In an interim final rule 
published in the Federal Register on July 14, 2004, ``Use of Materials 
Derived from Cattle in Human Food and Cosmetics,'' FDA prohibited SRMs 
(the same as defined by FSIS), the small intestine of all cattle, 
material from non-ambulatory disabled cattle, material from cattle not 
inspected and passed for human consumption, and MS(beef) from use in 
FDA-regulated human food, including dietary supplements, and cosmetics 
(69 FR 42255; FDA Docket No. 2004N-0081).
    In an advance notice of proposed rulemaking issued jointly by FDA, 
FSIS, and APHIS on July 14, 2004, ``Federal Measures to Mitigate BSE 
Risks: Considerations for Further Action'' (69 FR 42288-42300, FDA 
Docket No. 2004N-0264, FSIS Docket No. 04-021ANPR, APHIS Docket No. 04-
047-1), FDA requested additional information to help it determine the 
best course of action to reduce the already small risk of BSE spread 
through animal feed. (We refer to the advance notice of proposed 
rulemaking below as the ``USDA/FDA joint notice.'')
    FDA continues to conduct inspections to monitor compliance of 
domestic feed mills, renderers, and protein blenders with regulations 
it put in place in 1997 to prevent recycling of potentially infectious 
cattle tissue through ruminant feed. (FDA regulations at 21 CFR 
589.2000 prohibit the feeding of most mammalian protein to ruminants in 
the United States.) FDA also has expanded the scope of its inspections 
to include other segments of animal feed production and use, such as 
transportation firms, farms that raise cattle, and animal feed salvage 
operations. Compliance with the feed ban by U.S. feed mills, renderers, 
and protein blenders is currently very high. As of July 2004, 
conditions or practices warranting regulatory sanctions had been found 
in less than 1 percent of inspected facilities (Ref 6).
Harvard-Tuskegee Investigation of BSE Risk in the United States
    In April 1998, USDA commissioned the HCRA at Harvard University and 
the Center for Computational Epidemiology at Tuskegee University to 
conduct a comprehensive investigation of BSE risk

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in the United States. The report was completed in 2001 and released by 
the USDA. Following a peer review of the Harvard-Tuskegee Study in 2002 
(Ref 7), the authors responded to the peer review comments (Ref 8) and 
released a revised risk assessment in 2003 (Ref 3). The report, widely 
referred to as the Harvard Risk Assessment or the Harvard Study, is 
referred to in this document as the Harvard-Tuskegee Study.
    The Harvard-Tuskegee Study reviewed available scientific 
information related to BSE and other TSEs, assessed pathways by which 
BSE could potentially occur in the United States, and identified 
measures that could be taken to protect human and animal health in the 
United States. The assessment concluded that the United States is 
highly resistant to any amplification of BSE or similar disease and 
that measures taken by the U.S. Government and industry make the United 
States robust against the spread of BSE to animals or humans should it 
be introduced into this country.
    The Harvard-Tuskegee Study concluded that the most effective 
measures for preventing the potential spread of BSE are: (1) The ban 
placed by APHIS on the importation of live ruminants and ruminant meat-
and-bone meal from the United Kingdom since 1989 and all of Europe 
since 1997; and (2) the feed ban instituted in 1997 by FDA. The 
Harvard-Tuskegee Study further indicated that, if introduction of BSE 
had occurred via importation of live animals from the United Kingdom 
before 1989, mitigation measures in place in the United States at the 
time the Study was conducted would have minimized exposure and worked 
to eliminate the disease from the U.S. cattle population.
    The Harvard-Tuskegee Study also identified three practices that 
could create a pathway for human exposure to the BSE agent or the 
spread of BSE should it be introduced into the United States: (1) Non-
compliance with FDA's regulations prohibiting the use of certain 
proteins in feed for cattle and other ruminants; (2) rendering of 
animals that die on the farm and use (through illegal diversion or 
cross-contamination) of the rendered product in ruminant feed; and (3) 
the inclusion of high-risk tissues from cattle, such as brain and 
spinal cord, in products for human consumption.
    The Harvard-Tuskegee Study's independent evaluation of the 
potential risk mitigation measures predicts that a prohibition against 
rendering of animals that die on the farm would reduce the number of 
potential cases of BSE in cattle following hypothetical exposure by 82 
percent as compared to the base case scenario, and that a ban on SRMs 
(which included, according to the evaluation, the brain, spinal cord 
and vertebral column, ``gut,'' and eyes) from inclusion in human and 
animal food would reduce potential BSE cases in cattle by 88 percent 
and potential human exposure to BSE by 95 percent as compared to the 
base case scenario (Ref 9).
    In 2003, following the identification of BSE in a native-born cow 
in Canada, USDA, working with HCRA, evaluated the implications of a 
then-hypothetical introduction of BSE into the United States from 
Canada, using the same simulation model developed for the initial 
Harvard-Tuskegee Study. This assessment, titled ``Evaluation of the 
Potential Spread of BSE in Cattle and Possible Human Exposure Following 
Introduction of Infectivity into the United States from Canada'' (Ref 
10), confirmed the conclusions of the earlier Harvard-Tuskegee Study--
namely, that a very low risk exists of BSE becoming established or 
spreading should it be introduced into the United States.
Cohen and Gray Memorandum
    Following receipt of comments from the public on its November 2003 
proposed rule, APHIS requested the HCRA to respond to comments that 
pertained to the Harvard-Tuskegee Study. The HCRA's response to the 
comments, authored by Joshua Cohen and George Gray, was reported to 
APHIS in a June 18, 2004, memorandum, referred to below as ``the Cohen 
and Gray memorandum.'' The memorandum also updates the model used in 
the Harvard-Tuskegee Study with new data from the FDA addressing two 
critical model parameters--mislabeling of products containing 
prohibited ruminant protein and contamination of nonprohibited protein 
with prohibited protein. You may view the memorandum on the Internet by 
accessing the APHIS Web site at http://www.aphis.usda.gov/lpa/issues/bse/bse.html. Click on the document titled ``Analysis of Risk--Update 
for the Final Rule: Bovine Spongiform Encephalopathy; Minimal Risk 
Regions and Importation of Commodities, December 2004.''
Measures Taken in Canada in Response to BSE Risk Prior to May 2003
    Import restrictions. Canada imposed import restrictions to guard 
against the introduction of BSE, starting in 1990. In that year, Canada 
prohibited the importation of live cattle from the United Kingdom and 
the Republic of Ireland. In 1994, an import ban was imposed on all 
countries where BSE had been detected in native cattle. In 1996, Canada 
made this policy even more restrictive and prohibited the importation 
of live ruminants from any country that had not been recognized as free 
of BSE following a comprehensive risk assessment. Some animals were 
imported into Canada from high-risk countries prior to the imposition 
of these import restrictions. A total of 182 cattle were imported into 
Canada from the United Kingdom between 1982 and 1990. Similar to 
actions taken in the United States, efforts were made in Canada to 
trace these animals. In late 1993, after Canada identified a case of 
BSE in one of the imported bovines, all cattle imported from the United 
Kingdom or the Republic of Ireland that remained alive at that time 
were killed.
    Canada has also restricted the importation of ruminant products, 
including meat-and-bone meal, since 1978. In general, Canada has 
prohibited the importation of most meat-and-bone meal from countries 
other than the United States, Australia, and New Zealand. Limited 
amounts of specialty products of porcine or poultry origin have been 
allowed to be imported into Canada under permit for use in aquaculture 
feed products. No meat-and-bone meal for livestock feed-associated uses 
has been imported, except from the United States, Australia, and New 
Zealand.
    Feed ban. A crucial element in preventing the spread and 
establishment of BSE in a country is the implementation of a ruminant-
to-ruminant feed ban. Canada implemented a feed ban in 1997 that 
prohibits the feeding of most mammalian protein to ruminants. Under the 
ban in Canada, mammalian protein may not be fed to ruminants, with 
certain exceptions. These exceptions include pure porcine or equine 
protein, blood, milk, and gelatin. The feed ban is equivalent to the 
feed ban in place in the United States, with the addition that Canada 
prohibits the feeding of plate waste and poultry litter to ruminants.
    Canada has provided information, including statistics on 
compliance, demonstrating that an effective feed ban is in place in the 
rendering, feed manufacturing, and livestock raising industries. Few 
cattle born before implementation of the Canadian feed ban are alive 
today, given that most male cattle are slaughtered before 24 months of 
age and given the normal cull rates for beef and dairy cows. It is 
estimated that 39.4 percent of the beef cattle born in 1996 are alive 
today. It is estimated that 5.8 percent of the dairy cattle born in 
1996 are alive today.

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Infected animals typically exhibit clinical signs of BSE 4 to 6 years 
after infection, and 95 percent of infected cattle exhibit clinical 
signs in less than 7 years. Since cattle born before the feed ban would 
now be 7 years of age or older, any remaining infected cattle, if 
present, would likely be showing clinical signs of BSE that would allow 
their detection through Canada's BSE surveillance system.
    Canadian Government authorities inspect rendering facilities, feed 
manufacturers, and feed retailers to ensure compliance with the feed 
ban. Rendering facilities are regulated under an annual permit system, 
and compliance with the regulations is verified through at least one 
inspection each year. Feed manufacturers or mills, feed retailers, and 
farms have been inspected on a routine basis. These inspections have 
shown a high level of compliance. CFIA indicates that, with respect to 
the inedible rendering sector, full compliance with the feed ban 
requirements has been consistently achieved, and that, with respect to 
the Canadian commercial feed industry, CFIA has identified 
noncompliance of ``immediate concern'' in fewer than 2 percent of feed 
mills inspected during 2003-2004. Those instances of noncompliance of 
``immediate concern'' are dealt with when identified. According to 
CFIA, noncompliance of immediate concern includes situations where 
direct contamination of ruminant feed with prohibited materials has 
occurred, as identified through inspections of production documents or 
visual observation, and where a lack of appropriate written procedures, 
records, or product labeling by feed manufacturers may expose ruminants 
to prohibited animal proteins (Ref 11).
    Surveillance. Canada has an adult cattle population of 
approximately 5.5 million cattle older than 24 months of age. The 
current OIE Code, Appendix 3.8.4, references adult cattle populations 
as those greater than 30 months and recommends examining at least 300 
samples per year from high-risk animals in a country with an adult 
cattle population of 5 million, or 336 samples per year in a country 
with an adult cattle population of 7 million. Even though the adult 
cattle population in Canada is defined as greater than 24 months of age 
and OIE defines it as greater than 30 months of age, Canada has met or 
exceeded this level of surveillance for the past 7 years, thus 
exceeding the OIE guidelines. Active targeted surveillance was begun in 
Canada in 1992, with numbers of annual samples ranging from 225 in 1992 
to current levels of over 15,800 per year. This surveillance has 
continued to be targeted surveillance, with samples obtained from adult 
animals exhibiting some type of clinical signs or considered high risk 
for other reasons that could be considered consistent with BSE. During 
the time Canada has been conducting surveillance for BSE, BSE has been 
detected in only two cattle indigenous to Canada--the cows diagnosed 
with BSE in May and December 2003.
Canadian 2002 BSE Risk Assessment
    In December 2002, CFIA issued an assessment of the risk of BSE in 
Canada. The assessment evaluated BSE risk factors and correlating risk 
mitigation measures being taken in Canada, as well as surveillance 
being conducted in that country to detect any BSE-infected animals. The 
risk assessment analyzed the possibility that BSE infectivity was 
introduced into Canada through 665 cattle imported into Canada from 
Europe between 1979 and 1997, when Canada implemented its feed ban. The 
analysis indicated a low potential for cumulative introduction of 
infectivity into Canada via these cattle and further suggested that the 
likelihood of the spread and establishment of BSE in Canada, both 
before and after the 1997 feed ban, was negligible (Ref 12).
Epidemiological Investigation and a Report by an International Review 
Team
    On May 20, 2003, CFIA reported a case of BSE in a beef cow in 
northern Alberta. Following the detection of the BSE-infected cow, 
Canada conducted an epidemiological investigation of the BSE 
occurrence, working with, among others, APHIS representatives. The 
epidemiological investigation showed that the animal was born before 
implementation of the feed ban in 1997, and that exposure likely 
occurred prior to or near the time of the imposition of the feed 
regulations. Although a specific source of infection was not 
identified, the most likely source of exposure was feed that contained 
protein from an infected animal imported from the United Kingdom 
between 1982 to 1989.
    Additionally, the epidemiological investigation focused on rendered 
material or feed that could have been derived from the carcass of the 
infected cow. As part of that investigation, a survey was conducted of 
approximately 1,800 sites that were at some risk of having received 
such rendered material or feed. The survey suggested that 99 percent of 
the sites surveyed experienced either no exposure of cattle to the feed 
(96 percent of the sites) or only incidental exposure (3 percent of the 
sites). The remaining 1 percent represented limited exposures, such as 
cattle breaking into feed piles, sheep reaching through a fence to 
access feed, and a goat with possible access to a feed bag. 
Depopulation of Canadian herds possibly exposed to the feed in question 
was carried out by the Canadian Government. Canadian officials 
conducted a wide-ranging investigation of possible exposure to the feed 
in question and carried out depopulation of Canadian herds possibly 
exposed to the feed. On each of those farms where the investigation 
could not rule out the possibility of exposure to feed that may have 
contained rendered protein from the infected animal, the herds were 
slaughtered and tested. All of those animals tested negative for BSE 
and their carcasses were disposed of in ways, such as disposal in 
landfills, to ensure that they did not go into the animal food chain 
(Ref 13).
    In June 2003, an international review team (IRT) of animal disease 
experts assessed the CFIA's investigation of the May 2003 case of BSE 
and Canada's overall protective measures. The IRT noted the quality of 
the Canadian investigation and the effectiveness of protective measures 
in place in Canada. The IRT recommended a number of actions to further 
enhance the safety of human and animal health, including putting in 
place a national requirement that SRMs be removed from products 
destined for consumption; a review of animal feed restrictions; 
strengthened tracking and tracing systems; improved disease testing and 
surveillance; and additional efforts to improve disease awareness among 
producers, veterinarians, and the public (Ref 14).
Additional Measures Taken in Canada
    Response to the IRT Report. Subsequent to the IRT report, in July 
2003 Canada implemented the requirement that SRMs be removed from 
cattle at slaughter (Ref 15). Additionally, Canada implemented enhanced 
measures for identification and for tracking and tracing, as well as 
for increased BSE surveillance and testing. We discuss the increased 
surveillance and testing in greater detail below. (Ref 16).
    Epidemiological Investigation of the Case in Washington State. As 
noted above, in December 2003, BSE was detected in a Canadian-origin 
cow in Washington State. Canada, along with the United States, 
conducted a rigorous epidemiological investigation. As with the May 
2003 case, the epidemiological investigation showed that the animal was 
born in Canada before implementation of the feed ban in 1997 and, in 
all likelihood, was exposed to

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BSE before or near the time the Canadian feed ban was imposed. As with 
the May 2003 case, although a specific source of infection was not 
identified, the investigation indicated that the most likely source of 
exposure was feed that contained protein from an infected animal 
imported from the United Kingdom between 1982 to 1989. Again, the 
investigation resulted in the destruction and testing of a large number 
of potentially exposed cattle, and testing resulted in no further 
evidence of infection.
    Increased Surveillance. In January 2004, the Canadian Government 
announced that it would increase its level of BSE testing. As of 
December 1, 2004, Canada had tested more than 15,800 animals for BSE in 
2004, all with negative results, and has announced its goal of testing 
at least 30,000 animals in 2005. The surveillance program focuses on 
testing high-risk cattle: dead, dying, diseased, and down cattle over 
30 months of age and cattle showing neurological symptoms consistent 
with BSE. This level of testing represents a significant increase over 
previous testing levels; surveillance levels in Canada have increased 
to current levels from under 500 animals per year in 1996.
Update to APHIS' Risk Analysis and Summary of Mitigation Measures and 
Their Applicability to Canada as a BSE Minimal-Risk Region
    In order to add transparency to APHIS' basis for establishing a BSE 
minimal-risk category and including Canada in that category, we are 
making available a separate update of factors and measures that 
mitigate the risk of BSE and their applicability to imports from 
Canada. This update, titled ``Analysis of Risk-Update for the Final 
Rule: Bovine Spongiform Encephalopathy; Minimal Risk Regions and 
Importation of Commodities, December 2004,'' can be viewed on the 
Internet at http://www.aphis.usda.gov/lpa/issues/bse/bse.html. Click on 
the document titled ``Analysis of Risk-Update for the Final Rule: 
Bovine Spongiform Encephalopathy; Minimal Risk Regions and Importation 
of Commodities, December 2004.''
    The update extends the discussions APHIS provided previously in its 
risk analysis, explanatory note, proposed rule, and notice extending 
the comment period. In the update, we summarize the APHIS standards for 
a BSE minimal-risk region and the factors considered in our evaluation 
of such a region. We expand on our considerations of Canada as a 
minimal-risk region in the context of those standards. In accordance 
with OIE guidelines (Chapter 1.3.2), the original analysis had four 
major components: (1) Release assessment; (2) exposure assessment; (3) 
consequence assessment; and (4) risk estimation. In the update, we 
discuss in detail two of these four components--the release assessment 
and exposure assessment--and provide, in more depth, data relevant to 
our consideration of BSE risk. Finally, the update addresses 
information that has become available subsequent to our original 
analysis.

IV. Comments From the Public

    As noted above, we received a total of 3,379 comments from the 
public by the close of the comment period on April 7, 2004. They were 
from members of Congress, representatives of State and local 
governments, livestock producers, importers and exporters, 
organizations representing livestock producers, organizations 
representing processors and distributors of animal products and 
byproducts, individual companies, representative of foreign 
governments, a national animal health association, human health 
associations, the academic community, and other members of the public.
Subjects of Comments Received
    A number of commenters supported the rule and recommended no 
changes to the proposed provisions. Other commenters supported the rule 
in general but recommended certain changes to the proposed provisions. 
Others comments consisted only of recommended changes, objections to 
the rule in general or to specific provisions, or requests for 
clarification. In general, the comments we received on the proposed 
rule can be categorized as follows:
     Comments on the proposed standards for BSE minimal-risk 
regions;
     omments on whether Canada should be recognized as a 
minimal-risk region;
     Comments on the proposed risk mitigation measures for the 
importation of live ruminants from Canada;
     Comments on the proposed risk mitigation measures for the 
importation of ruminant meat and meat products derived from animals in 
Canada;
     Comments on the risk analysis;
     Comments on the economic analysis;
     Comments on the environmental analysis;
     Comments advocating that we delay implementation of this 
rule or withdraw the proposal;
     Comments on miscellaneous issues related to the proposed 
rule.
    We discuss these comments by topic below.
Clarification
    We note that, in order to clarify our intent in this final rule, we 
are making a change to the proposed minimal-risk standards that was not 
addressed by commenters. One of the standards we proposed to evaluate 
for a BSE minimal-risk region was whether the region maintains, and, in 
the case of regions where BSE was detected, had in place prior to the 
detection of BSE, risk mitigation measures adequate to prevent 
widespread exposure and/or establishment of the disease. In this final 
rule, we are clarifying that the BSE detection referred to in that 
factor is detection in an animal indigenous to the region, consistent 
with the OIE guidelines for BSE. We are making this change to 
distinguish between the risk of BSE from detection in indigenous 
animals and imported animals. In this regard, detection of the disease 
in an indigenous animal suggests that transmission of the agent has 
occurred in the region, whereas an imported case does not.
    In this final rule, we are making several other clarifications of 
our regulations. These additional clarifications are discussed below, 
following the discussion of comments, under the heading ``V. Additional 
Clarifications.''

A. Proposed Standards for BSE Minimal-Risk Regions

    Some of the comments we received on our proposed rule agreed with 
the standards proposed for a BSE minimal-risk region and supported our 
proposed classification of Canada as such a region. However, a number 
of other commenters questioned the clarity of and basis for the BSE 
minimal-risk standards. Others disagreed that Canada should be 
considered such a region.
Proposed Minimal-Risk Standards in General
    Issue: One commenter requested that APHIS reconsider the approach 
of establishing a category of BSE minimal-risk region. The commenter 
stated that, because OIE already lists a category very similar to 
APHIS' BSE minimal-risk category, referring to ``minimal risk'' in the 
proposal is an unnecessary duplication of definitions and could lead to 
confusion. The commenter also suggested that APHIS link definitions and 
the consequent treatment of animals and meat products to the OIE Code. 
Several commenters said that APHIS should not adopt criteria for BSE 
minimal-risk regions that differ from

[[Page 470]]

OIE guidelines for BSE minimal-risk regions or questioned APHIS' basis 
for doing so. One of these commenters stated that OIE guidelines have 
highly detailed and specific criteria that allow the identification of 
minimal-risk regions and said that APHIS did not provide sufficient 
analysis in the proposed rule to support the creation of a new minimal-
risk category. Some others said that APHIS did not adequately describe 
the scientific basis for deviating from the OIE guidelines, 
particularly with respect to time during which ruminant feed 
restrictions have been in place.
    Response: We are making no changes based on these comments. We 
consider the definition of BSE minimal-risk region in this rule to be 
clear. We have explained our reasoning in detail for adopting 
performance standards for the critical factors, and discussed at some 
length our conclusion that some regulatory flexibility is essential. We 
noted the that the OIE guidelines are fluid, and discussed above in 
section III. B., under the heading ``APHIS' Regulatory Approach to BSE: 
Past and Present,'' that OIE may revise its BSE classifications in the 
near future.
    As discussed above in section III. B. under the heading ``More 
Focused Regulatory Restrictions,'' although APHIS did not incorporate 
the text of OIE's BSE guidelines into its proposed rule, the agency 
based its standards on those guidelines, and the APHIS standards 
contain the same essential factors for assessing a region's BSE status 
as the OIE guidelines (e.g., import requirements, incidence, 
surveillance, feed restrictions, etc.). The proposed rule and 
associated risk analysis explain where APHIS' proposed standards for 
minimal-risk regions departed from OIE guidelines. The preamble to the 
proposed rule discussed how we would use those standards to evaluate 
the BSE risk of a region. We said we would use the standards as a 
combined and integrated evaluation tool in evaluating a region, 
focusing on the overall effectiveness of all control mechanisms in 
place (e.g., surveillance, import controls, and a ban on the feeding of 
ruminant protein to ruminants). We further explained that, in regions 
where BSE had been diagnosed, we would base our evaluation on the 
overall effectiveness of all control mechanisms in place at the time 
BSE was diagnosed in the region, and on actions taken after the 
diagnosis (e.g., the epidemiological investigation of the occurrence). 
We agree that this approach differs from the OIE's in that it does not 
adhere to specific numerical recommendations specified in some of the 
OIE guidelines, but, as discussed earlier, the OIE guidelines are in 
flux and are meant to be a reference document. Further, 
disqualification of a region for failure to precisely meet one OIE 
recommendation would not account for a region's potential to present an 
overall minimal risk for BSE by exceeding other OIE recommendations or 
other relevant factors bearing on a risk to animal health.
    We discussed in the proposed rule's preamble how we applied our 
standards for minimal risk to an evaluation of Canada's BSE risk. For 
example, we stated that, although Canada has had a feed ban in place 
for only 7 years (1 year less than provided for by OIE), this time 
period may be conservative because of the variability in the incubation 
period for BSE. Based on an analysis of data collected in the United 
Kingdom, the Harvard-Tuskegee Study (Ref 17) estimates that the 
variability distribution for the BSE incubation period in cattle has a 
median (50th percentile) of approximately 4 years and a 95th percentile 
of approximately 7 years. Based on the best-fit parameter values 
provided in the Harvard-Tuskegee Study (Ref 18), the mean (expected 
value) of the incubation period distribution is estimated at 4.2 years, 
and 7.5 years (August 1997 through January 2005) represents the 
estimated 97.5th percentile of the incubation period. We determined 
that the duration of the feed ban in Canada adequately addresses the 
expected BSE incubation period, taking into consideration all of the 
actions Canada has taken to prevent the introduction and control the 
spread of BSE (e.g., import controls, level and quality of 
surveillance, effectiveness of feed ban, epidemiological investigation 
of detected cases, and depopulation of herds possibly exposed to 
suspected feed sources). We, therefore, concluded that a feed ban of 
less than 8 years' duration was appropriate for Canada. Canada, in 
fact, meets all OIE guidelines for a minimal-risk region, except for 
the duration of its feed ban.
    We also note that OIE's guidelines for BSE include not just 
guidelines for classifying regions according to risk, but corresponding 
guidelines for trade in cattle, meat, and meat products from regions, 
according to the region's BSE risk classification. Our rule is 
consistent with this two-part OIE approach of considering a region's 
overall BSE risk status in combination with appropriate import 
restrictions for specific commodities.
    Issue: A few commenters said that adopting criteria less stringent 
than OIE guidelines could result in other countries' perceiving the 
United States as having a greater BSE risk status and, therefore, 
prohibiting or restricting imports of cattle and beef from the United 
States. One commenter observed that OIE has five risk classifications 
for regions and said that, while some countries may choose to trade 
with high-risk regions, the United States should trade only with 
countries determined to be free of BSE.
    Response: We are working diligently on an international level to 
ensure that BSE-related trade restrictions are based on sound science 
and a realistic understanding of the risks presented by the commodities 
we are proposing for trade. We do not believe it is appropriate to 
limit trade in cattle, meat, and meat products only to regions 
determined to be free of BSE if there are measures that can be applied 
to mitigate the risk of those commodities introducing BSE into the 
United States. There are such mitigation measures, consistent with 
those we have proposed. In fact, OIE guidelines provide for trade in 
cattle of any age, as well as beef and many other cattle products, even 
from countries that are considered high risk for BSE.
    Issue: One commenter said that he was not opposed to APHIS' 
adopting criteria for minimal-risk regions that differ from OIE 
guidelines, but that APHIS' criteria put too much emphasis on import 
controls and epidemiological investigations and not enough on risk 
management measures in a country under consideration. The commenter 
mentioned a variety of risk mitigation measures in place in the 
European Union, including removal of SRMs; a ban on the feeding of 
mammalian meat-and-bone meal (MBM) to cattle, sheep, and goats; a 
suspension on the use of processed animal protein in feeds for any 
animals farmed for the production of food since January 2001, with the 
exception of fish meal for pigs and poultry; high processing standards 
for the treatment of ruminant animal waste; surveillance measures in 
accordance with the OIE Code; an ongoing awareness program for 
veterinarians; compulsory notification of all cattle showing clinical 
signs of BSE; testing of risk animals (fallen stock, emergency 
slaughtered animals, and animals with clinical signs at post-mortem 
inspection) over 24 months of age and healthy slaughtered animals over 
30 months of age; culling policy for animals with a high probability of 
receiving the same potentially infected feed as a BSE case and 
offspring of female BSE cases; approval of rapid tests with the same 
sensitivity as the confirmatory methods.

[[Page 471]]

    Response: We agree with the commenter regarding the effectiveness 
of an integrated BSE risk management approach, and APHIS' standards for 
minimal-risk regions consider risk management measures such as those 
mentioned by the commenter. As discussed above, the standards we 
proposed for a BSE minimal-risk region included the need for risk 
mitigation measures to have been in place even before detection of BSE. 
These would be considered under the broad criteria that form our 
definition of minimal-risk region. Specifically, those standards 
include: (1) Having in place risk mitigation measures adequate to 
prevent widespread exposure and/or establishment of the disease, 
including import restrictions, surveillance for BSE at levels that meet 
or exceed OIE recommendations, and a ban on the feeding of ruminant 
protein to ruminants; (2) conducting, in regions where BSE has been 
detected, an epidemiological investigation sufficient to confirm the 
adequacy of measures to prevent the further introduction or spread of 
BSE; and (3) taking additional risk mitigation measures, as necessary, 
in regions where BSE has been detected.
    We emphasize, in this final rule, import controls as actions to 
avoid the introduction of the BSE infectious agent, and epidemiological 
investigations as action to promptly determine the extent of 
introduction. However, we also place value on risk management actions 
that were already in place in cases where BSE is detected.
    Issue: Several commenters stated that APHIS' proposed standards for 
a minimal-risk region were relatively ambiguous compared to the 
corresponding provisions of the OIE Code. One such commenter stated 
this is partly because the proposal did not have an objective 
acceptable threshold regarding the extent of BSE infection in the 
country and a minimum enforcement period of effective measures, 
including a feed ban. Consequently, recommended the commenter, the 
United States should either: (1) Prepare objective guidelines that 
would allow exporting countries to determine their status with a 
certain level of predictability; or (2) investigate and approve more 
than one country. The commenter stated that the latter option would 
give other countries a much clearer idea of what is acceptable.
    Response: As explained previously, while there are differences 
between the APHIS standards and the OIE guidelines, these differences 
reflect the different purposes and uses of the OIE guidelines and our 
standards. The OIE guidelines are designed to provide a science-based 
reference document for international trade in animals and animal 
products. Articles adopted by the OIE membership provide guidance for 
use by veterinary authorities, import/export services, epidemiologists 
and all those involved in international trade. OIE guidelines are not, 
however, intended to be prescriptive; each member nation may determine 
its own appropriate level of protection and, therefore, establish its 
own import requirements.
    In contrast, regulations, which may be based on the OIE guidelines, 
are prescriptive, as they are intended to be enforced through an 
appropriate enforcement and compliance program. Furthermore, as 
rulemaking may take considerable time, the most successful regulations 
must also be flexible enough to allow a country to consider individual 
circumstances among its existing and potential trading partners, as 
well as advances in science, without undergoing constant revisions.
    As explained previously, specific numeric recommendations in the 
OIE guidelines have changed over time and can be expected to change 
further in the future. Rigid adherence to each specific standard would 
disqualify some regions that present an overall minimal risk for BSE, 
despite not quite meeting one standard, as a result of exceeding 
certain other guidelines. We do not consider the suggested approach to 
provide a sufficient level of flexibility to allow consideration of the 
nature of BSE and the need to acknowledge and address varying 
permutations of risk among different regions on a case-by-case basis. 
Under the Animal Health Protection Act (AHPA) (7 U.S.C. 8301-8317), 
``the Secretary may prohibit or restrict the importation or entry of 
any animal, article, or means of conveyance * * * if the Secretary 
determines that the prohibition or restriction is necessary to prevent 
the introduction into or dissemination within the United States of any 
pest or disease of livestock'' (7 U.S.C. 8303(a)). However, neither the 
AHPA nor the Secretary (or officials delegated by the Secretary) has 
delineated through regulations all the specific conditions that might 
be considered necessary to protect against the introduction of animal 
diseases or pests. This flexibility is necessary for APHIS to evaluate 
situations involving specific animal diseases or pests of concern and 
impose specific importation conditions necessary to mitigate the risk 
of the introduction of such diseases and pests.
    The use of rigid criteria may limit the scope of acceptable 
alternatives for mitigating risk. This is particularly critical for 
trade-related issues. The situations in individual regions differ 
significantly, and each region defines its own particular spectrum of 
control measures. An equivalent level of risk might be reached using 
various combinations of different control measures. In this context, it 
is quite possible that a region that does not meet a particular numeric 
standard could compensate for any risk with other control measures. A 
case in point is Canada. Although Canada does not precisely meet the 
OIE guideline for duration of a feed ban, its control measures in other 
areas (such as surveillance and import restrictions) more than 
compensate for this. In some cases, holding a country to a rigid 
criterion without consideration of compensatory risk reduction measures 
may inappropriately discriminate against regions where the overall 
conditions indicate minimal BSE risk. In other cases, uniformly 
applying a numeric criterion without a thorough consideration of 
qualitative factors (e.g., the quality of a country's surveillance 
program and the supporting veterinary infrastructure) could result in 
trade with a region that presents an undue risk of BSE introduction. In 
order to make rational decisions, APHIS needs the flexibility to make 
case-by-case determinations regarding the animal health status of 
particular regions. In fact, the OIE guidelines state that risk 
assessment should be flexible, in order to deal with the complexity of 
real-life situations. Specifically, the OIE Code states that risk 
assessment must be able to accommodate the variety of animal 
commodities, the multiple hazards that may be identified with an 
importation, the specificity of each disease, detection and 
surveillance systems, exposure scenarios, and types and amounts of data 
and information (Ref 19).
    With regard to investigating and recognizing additional countries 
as BSE minimal-risk regions, that process begins with a request by the 
country interested in being considered, along with submission by that 
country of the necessary information. Several countries, in fact, 
submitted data in conjunction with their comments on our proposed rule. 
In those cases where the information exchange between the requesting 
country and the United States is at a very preliminary stage, it will 
likely be some time before we have all of the information needed and 
can complete our evaluation. Once an evaluation is completed, we will 
provide an opportunity for public comment through a proposed rule to

[[Page 472]]

add the region to our list of minimal-risk regions for BSE.
    Issue: Two commenters questioned why we did not include the 
preparation of a risk analysis as a criterion for minimal-risk status, 
pointing out that a risk analysis is a basic requirement for OIE 
country classification for BSE under the OIE guidelines. One of these 
commenters said that the OIE guidelines regarding BSE minimal-risk 
require that a risk analysis be conducted and appropriate measures be 
taken to manage any risk identified. In contrast, said the commenter, 
instead of focusing on a region's total risk analysis process (as the 
OIE guideline does), APHIS focuses only on whether the region's risk 
mitigation strategies are adequate to prevent ``widespread exposure 
and/or establishment of the disease.'' The commenter questioned whether 
this approach would allow a region's potential BSE risk to be 
adequately assessed and addressed before the region was considered 
minimal-risk.
    Response: We consider an analysis of risk to be an inherent and 
integral component of the evaluation of a particular region with regard 
to BSE. Further, such an analysis is required under the WTO-SPS 
Agreement and the North American Free Trade Agreement. We encourage any 
region proposing trade to conduct such a risk analysis and include it 
with the documentation and data that APHIS requires. However, we did 
not include the preparation of a risk analysis by a region in our 
standards for minimal-risk status because APHIS itself intends to 
assess the BSE risk of a region using the criteria that were listed. 
APHIS routinely performs a risk analysis when proposing to allow 
imports, not just regarding BSE, but also with regard to other diseases 
of concern. A case in point is the risk analysis we prepared for this 
rulemaking. The standard mentioned by the commenter-whether a region's 
risk mitigation strategies are adequate to prevent widespread exposure 
and/or establishment of the disease--is only one factor that will be 
considered in the risk analysis. That factor itself has subsets 
concerning import restrictions, surveillance for BSE at levels that 
meet or exceed OIE guidelines, and a ban on the feeding of ruminant 
protein to ruminants. In addition, our risk analysis would assess 
whether, in regions where BSE has been detected, the region: (1) Had 
conducted an epidemiological investigation sufficient to confirm the 
adequacy of measures to prevent the further introduction or spread of 
BSE and (2) had taken, and was continuing to take, additional risk 
mitigation measures, as necessary, such as, for example, increased 
surveillance. With regard to Canada, our risk analysis assessed both 
the risk mitigation measures in place before the diagnosis of BSE in 
that country and the actions Canada took after the detection.
    Issue: Two commenters recommended that we provide more specificity 
about how APHIS would evaluate whether a region meets the criteria for 
minimal-risk status. One of the commenters called the proposed 
standards for minimal-risk regions ``a series of ill-defined factors'' 
and complained that no mechanisms for enumerating or weighing these 
factors were set forth in the proposal. The other commenter agreed with 
the approach of evaluating a region for minimal-risk status using a 
combined and integrated evaluation tool, rather than basing the 
evaluation on single-factor values such as OIE recommendations on 
feeding. However, the commenter suggested that how a region meets 
APHIS' standards should be quantitatively as well as qualitatively 
evaluated and that the results should be measured in terms of the 
relative importance to the combined and integrated overall evaluation 
(e.g., surveillance might need to be different from the OIE 
recommendation and weighted more heavily than some other standards). 
The commenter suggested further that, in evaluating regions beyond 
Canada, APHIS should publish for public comment detailed risk 
assessments, as well as the results of the combined and integrated 
evaluation of the factors used to determine risk for establishing any 
BSE minimal-risk region.
    Response: We consider it necessary and appropriate not to specify 
in the regulations mechanisms for enumerating or weighing the standards 
for a minimal-risk region. As discussed above under the heading ``More 
Focused Regulatory Restrictions,'' holding a country to a rigid 
criterion without consideration of compensatory risk reduction measures 
may, in some cases, unfairly discriminate against regions where the 
overall conditions indicate equivalence with minimal BSE risk. In other 
cases, uniformly applying a numeric criterion without a thorough 
consideration of qualitative factors (e.g., the quality of a country's 
surveillance program and the supporting veterinary infrastructure) 
could result in trade with a region that presents an undue risk of BSE 
introduction.
Application of Standards to Other Countries
    Issue: A number of commenters raised questions regarding how the 
proposed standards for BSE minimal-risk regions would be applied to 
countries other than Canada. Some commenters stated it appeared the 
standards were tailored to meet the situation in Canada. Several 
commenters proposed additional countries for classification as BSE 
minimal risk and suggested that those countries be included in this 
rulemaking. One commenter requested that APHIS publish for public 
comment evaluations done for regions beyond Canada. One commenter 
recommended that applications for BSE minimal-risk recognition from 
regions with similar status as Canada be rejected. Conversely, another 
commenter recommended that any countries that currently have standards 
that equal or exceed those of Canada should be included as BSE minimal-
risk regions in this final rule.
    Response: We stated in our proposed rule that we would consider 
requests from other countries for recognition as minimal-risk regions 
once the regulatory framework defining a BSE minimal-risk region had 
been established through this rulemaking. We will evaluate other 
countries using the same standards we used for evaluating Canada. 
Countries wishing to be recognized as minimal-risk regions by APHIS 
need to apply for such recognition by following the procedures set 
forth in 9 CFR part 92, ``Importation of Animals and Animal Products: 
Procedures for Requesting Recognition of Regions.'' Although the 11 
factors listed in part 92 are not the same as the standards listed in 
this rule for BSE minimal-risk regions, they are broadly applicable to 
any change in disease status and are compatible with the BSE minimal-
risk standards in this rule. As noted above, several countries 
submitted data in conjunction with their comments on our proposed rule. 
Once all of the necessary information is received, we will conduct an 
evaluation of the request and, if a proposal appears warranted, provide 
an opportunity for public comment through a proposed rule to add the 
region to our list of minimal-risk regions for BSE. A final rule based 
on the proposed rule would need to be issued before imports could 
begin.
    Issue: One of the standards for minimal-risk status was that a 
region in which BSE has been detected must have had in place, prior to 
the detection of BSE in the region, risk mitigation measures adequate 
to prevent widespread exposure to and/or establishment of the disease. 
Several commenters asked how, according to that criterion, countries 
that reported cases of BSE before scientific studies had determined 
appropriate risk

[[Page 473]]

mitigation requirements would be able to be considered BSE minimal-risk 
regions.
    Response: We agree that countries that were among the first to 
diagnose BSE will, under the standards in this rule, not qualify as BSE 
minimal-risk regions. Because of the lengthy incubation period of the 
disease, by the time BSE was diagnosed in such countries and control 
measures were implemented, the chances that the disease had 
significantly spread were great. However, individual regions may apply 
to APHIS to be able to export to the United States specific products 
under conditions that could differ from those in our current 
regulations. Such applications should be submitted in accordance with 9 
CFR part 92 and will be considered when received by APHIS.
Measures to Prevent Widespread Exposure or Establishment
    Issue: In our proposed definition of BSE minimal-risk region in 
Sec.  94.0, we provided that such a region must maintain, and, in the 
case of regions where BSE was detected, must have had in place prior to 
the detection of BSE, risk mitigation measures adequate to prevent 
widespread exposure and/or establishment of the disease. One commenter 
asked the following questions: (1) What exactly are the risks to be 
addressed and mitigated by the country seeking minimal-risk status; (2) 
what risk mitigation measures are deemed adequate; and (3) what are the 
standards to be used to judge whether the measures are adequate?
    Response: As discussed in the preamble to our proposed rule, in 
evaluating whether a country had in a place risk mitigation measures 
adequate to prevent widespread exposure or establishment of BSE, we 
would consider whether the country had in place:
     Restrictions on the importation of animals sufficient to 
minimize the possibility of infected ruminants being imported into the 
region, and on the importation of animal products and animal feed 
containing ruminant protein sufficient to minimize the possibility of 
ruminants in the region being exposed to BSE;
     Surveillance for BSE at levels that meet or exceed OIE 
recommendations for surveillance for BSE; and
     A ban on the feeding of ruminant protein to ruminants that 
appears to be an effective barrier to the dissemination of the BSE 
infectious agent, with no evidence of significant noncompliance with 
the ban.
    We provided, further, that, in regions where BSE was detected, a 
minimal-risk region must have conducted an epidemiological 
investigation following detection of BSE sufficient to confirm the 
adequacy of measures to prevent the further introduction or spread of 
BSE, and must continue to take such measures. Additionally, the region 
must have taken additional risk mitigation measures, as necessary, 
following the BSE outbreak based on risk analysis of the outbreak, and 
continue to take such measures.
    We did not specify numeric thresholds for each of the above 
criteria. As discussed above, because rulemaking may take considerable 
time, the most successful regulations must also be flexible enough to 
allow a country to consider individual circumstances among its trading 
partners, as well as changes in science, without undergoing constant 
revisions. Further, in some cases, holding a country to a rigid 
criterion without consideration of compensatory risk reduction measures 
may not be scientifically justified and may unfairly discriminate 
against regions where the overall conditions indicate minimal BSE risk. 
In other cases, rigidly applying a numeric criterion without a thorough 
consideration and evaluation of relevant factors (e.g., the quality of 
a country's surveillance program and the supporting veterinary 
infrastructure) could result in trade with a region that may meet 
numeric criteria but, nonetheless, present, in our view, an undue risk 
of BSE introduction. Therefore, APHIS chose to base its evaluation on 
OIE guidelines in a way that allows us to consider an individual 
country's specific situation and to analyze risk based on the overall 
effectiveness of actions taken by the country to prevent the 
introduction and spread of BSE.
    Issue: As noted above, one of the proposed standards for a BSE 
minimal-risk region was that, in regions where BSE was detected, the 
region ``had in place prior to the detection of BSE, risk mitigation 
measures adequate to prevent widespread exposure and/or establishment 
of the disease.'' One commenter asked for clarification of the meaning 
of ``widespread exposure or establishment,'' of whether moderate 
exposure or establishment is acceptable, and of how many cases are 
acceptable in both humans and animals. Another commenter stated that 
the wording in the definition could create disagreements with regions 
applying for BSE minimal-risk status as to whether the disease is 
widespread in a particular region.
    Response: APHIS has set no specific thresholds for an acceptable 
number of cases in humans or animals. Rather, the Agency will conduct 
an evaluation of the BSE situation in a region according to the factors 
in that region and define mitigations appropriate for the conditions. 
APHIS would consider in its evaluations OIE recommendations regarding 
the recommended maximum number of BSE cases per million at different 
BSE risk levels.
    As an example, APHIS considers the situation that existed in the 
United Kingdom and certain other European countries in the 1990s to be 
clearly an example of widespread exposure or establishment, and also 
one that would clearly contribute to a high-risk categorization under 
OIE guidelines (Ref 1). Widespread BSE exposure in the United Kingdom 
was at its peak in the early 1990's, as reflected by the finding of 
more than 30,000 cases per year in 1992-1993. The situation has 
improved dramatically with the stringent control measures that have 
been imposed in the United Kingdom. This has also been the case in 
other European countries that have had what we consider ``widespread 
exposure.'' It is important to note that, in each of these situations, 
BSE was detected and control measures were then instituted, resulting 
in some delay until the effects of the control measures could become 
apparent. These situations were very different, for example, from the 
situation in Canada, where: (1) Control measures were in place before 
the detection of the disease; (2) only two animals of Canadian origin 
have been confirmed with BSE; (3) both were born before implementation 
of Canada's feed ban; and (4) Canada has maintained other protective 
measures (including import restrictions) that would help preclude a 
significant level of infectivity from being transmitted to the cattle 
population.
Surveillance
    Issue: One commenter stated that the premise in the proposed rule 
that prevalence of BSE will be lower in regions with adequate 
prevention and control measures does not take into account that the 
level of determined prevalence is dependent on the quality and level of 
surveillance in each region. The commenter expressed concern that, 
although a country may say it has low prevalence, its surveillance may 
be inadequate to accurately measure the prevalence.
    Response: We agree with the commenter concerning the importance of 
a valid and effective surveillance program. One of the first 
evaluations we make regarding a country or other region seeking a 
particular animal health status is the effectiveness and

[[Page 474]]

reliability of its veterinary infrastructure, including its 
surveillance programs.
    Issue: One commenter recommended that the specific content of 
adequate surveillance systems be detailed in the regulations.
    Response: In this rulemaking, we require that a region seeking BSE 
minimal-risk status conduct surveillance for BSE at levels that meet or 
exceed OIE recommendations for surveillance for the disease. As noted 
above, in establishing its guidelines, the OIE Terrestrial Animal 
Health Standards Commission draws upon the expertise of internationally 
renowned specialists to draft new and revised articles of the 
Terrestrial Code in light of advances in veterinary science. Therefore, 
the OIE guidelines are constantly evolving and subject to change. In 
order to make our regulations flexible enough to allow us to 
accommodate internationally recognized changes in science without 
making constant revisions to the regulations, we are basing our 
requirements for surveillance on OIE recommendations, but are not 
specifying numeric thresholds in this rule.
Feed Restrictions
    Issue: One of the standards we proposed for a BSE minimal-risk was 
that the region have ``a ban on the feeding of ruminant protein to 
ruminants that appears to be an effective barrier to the dissemination 
of the BSE infectious agent, with no evidence of significant 
noncompliance with the ban.'' Several commenters took issue with this 
factor. The commenters stated that the absence of evidence of 
noncompliance is not evidence of compliance and that this standard 
could be met by countries with no or minimal compliance monitoring. The 
commenters stated that the feed ban should be enforced by an inspection 
program, including sampling and testing of feed, as recommended by the 
IRT. Another commenter took issue with the words ``appears to be,'' 
recommending instead that the factor should address whether a feed ban 
is or is not an effective barrier in a particular region. One commenter 
stated that specific guidelines for compliance, including on-farm 
compliance, should be provided.
    Response: We concur that the lack of evidence of noncompliance may 
not be evidence of compliance. We did not intend for the proposed rule 
to produce or allow for the result described by the commenter. For this 
reason, we are changing the wording of the factor referred to by the 
commenter to provide instead that ``a ruminant-to-ruminant feed ban is 
in place and effectively enforced.'' It was, and continues to be, our 
intent to evaluate all relevant factors thoroughly. Determining whether 
a feed ban has been effectively enforced will involve a review by APHIS 
of a number of interrelated factors, including: The existence of a 
program to gather compliance information and statistics; whether 
appropriate regulations are in place in the region; the adequacy of 
enforcement activities (e.g., whether sufficient resources and 
commitment is dedicated to enforcing compliance); a high level of 
facility inspections and compliance; accountability of both inspectors 
and inspected facilities; and adequate recordkeeping. Our individual 
evaluation of the BSE status of a region will assess these factors and 
evaluate any contribution to risk.
    Issue: Several commenters expressed concern regarding a U.S. 
recommendation to the OIE that the OIE feed ban duration standard be 
reduced from 8 to 5 years. One commenter recommended that USDA champion 
a continuation of the current OIE standard. Commenters stated that 
shortening the standard from an 8-year feed ban was inadvisable because 
it is possible some residual ruminant protein feed in some countries 
would be fed for several years after a feed ban went into effect.
    Response: The APHIS recommendation that the OIE standard for the 
minimum duration of a feed ban be reduced from 8 years to 5 years was 
based on the estimated average incubation period of the BSE agent in 
cattle. As discussed above, the Harvard-Tuskegee Study (Ref 17) 
estimates that the variability distribution for the BSE incubation 
period in cattle has a median (50th percentile) of approximately 4 
years. Based on the best-fit parameter values provided in the Harvard-
Tuskegee Study (Ref 18), the mean (expected value) of the incubation 
period distribution is estimated at 4.2 years. However, the OIE decided 
not to change the standard.
Epidemiological Investigation
    Issue: A commenter expressed concern with the proposed factor for a 
BSE minimal-risk region related to an epidemiological investigation. 
This factor stated that, in regions where BSE has been detected, a 
minimal-risk region must have ``conducted an epidemiological 
investigation following detection of BSE sufficient to confirm the 
adequacy of measures to prevent the further introduction or spread of 
BSE, and continues to take such measures.'' The commenter stated that 
the standard focuses on the conduct of an investigation and not whether 
there were definitive findings resulting from such an investigation. 
The commenter also took issue with our explanation in the preamble that 
``an investigation following a detected case would include, among other 
things, an investigation to determine the most likely source of the 
animal's exposure to BSE,'' saying that the ``most likely source'' is 
not a definitive finding.
    Response: Certainly, the quality of the investigation and its 
results and findings must be carefully evaluated. However, definitive 
findings are not always possible or necessary in an epidemiological or 
scientific investigation. If a region is able to explain the approach 
it has taken in its investigation and produce adequate information 
regarding the most likely source of infection, the lack of a definitive 
finding can be within normal scientific parameters. Uncertainty may, in 
many instances, be compensated for in other areas, such as through 
appropriate mitigations. Depending on the quality of the 
epidemiological investigation, the absence of definitive findings may 
be less important than whether there are adequate measures in place to 
address disease risk.
Additional Measures
    Issue: One commenter expressed concern with the proposed factor for 
a BSE minimal-risk region that requires that, in regions where BSE was 
detected, the minimal-risk region ``took additional measures, as 
necessary, following the BSE outbreak based on risk analysis of the 
outbreak, and continues to take such measures.'' The commenter objected 
to our explanation in the preamble that additional risk mitigation 
measures could include ``a broad eradication program, increased 
surveillance, or additional import restrictions,'' expressing concern 
that the statement indicates that additional measures either could or 
could not include those listed by APHIS.
    Response: We intended the additional mitigation measures that were 
listed by the commenter (a broad eradication program, increased 
surveillance, and additional import restrictions) to be examples of 
possible additional measures that might be necessary. In pointing to 
those measures, we did not intend to provide a definitive list of 
additional mitigation measures we might consider; rather, the examples 
were intended to provide a sense of the types of measures we might 
consider. Indeed, in the discussion of OIE standards in the updated 
risk analysis,

[[Page 475]]

we provide several more examples of additional mitigation measures we 
are considering, e.g., an ongoing awareness program for veterinarians, 
farmers, and workers involved in transportation, marketing, and 
slaughter of cattle; compulsory notification and investigation of all 
suspected cases of BSE; and examination in an approved laboratory of 
brain and other tissues collected within the framework of the 
surveillance and monitoring system. As we stated in the preamble of our 
proposal, measures will be required that are appropriate depending on 
the conclusions of the risk analysis that is required following a BSE 
diagnosis.
Human Health Risks
    Issue: Several commenters recommended that the definition of BSE 
minimal-risk region specifically list actions taken to minimize human 
health risks, which the commenter said should be equal to or more 
stringent than those in the United States. The commenters stated that 
the definition should require, for example, that minimal-risk regions 
do the following: (1) Ban use of non-ambulatory cattle; (2) hold 
product/carcass until negative results are obtained; (3) prohibit air-
injected stunning; (4) remove high-risk tissues; and (5) prevent the 
inclusion of central nervous system tissue in ``meat'' products.
    Response: The issues raised by the commenters relate to the 
equivalency of standards for the production of meat in countries that 
export to the United States. The FSIS regulations in 9 CFR 327.2 
provide that, to be eligible to export meat and meat products to the 
United States, a foreign country must be able to certify that it 
applies to its own meat processing establishments requirements 
equivalent to those in the United States. Under those regulations, 
exporting countries are required to provide documentation supporting 
how their meat inspection system is equivalent to that of the United 
States. FSIS determines whether the systems are equivalent. The FSIS 
procedures for evaluating such equivalency are discussed below in more 
detail, under the heading ``Verification of Compliance in the Exporting 
Region.'' Each of the requirements recommended by the commenter are 
currently required of meat processing establishments in the United 
States and, therefore, are applicable to establishments in foreign 
countries that wish to export meat and meat products to the United 
States.
Tracking and Labeling
    Issue: One commenter recommended that requirements for a minimal-
risk region include existence of a national animal identification and 
tracking program, adequate and active testing and monitoring programs 
for all OIE List A animal diseases, and product labeling to enable 
tracking of the product.
    Response: Although the standards for a BSE minimal-risk region in 
this rule do not specifically require a national animal identification 
and tracking program, they do include a requirement for an effective 
epidemiological investigation and the ability of authorities in the 
region to conduct traceback and trace-forward of animal feed or 
rendered material. An evaluation of these capabilities will include 
consideration of animal identification. Although we acknowledge the 
importance of adequate testing and monitoring for OIE List A diseases 
with regard to whether and under what conditions animals and animal 
products should be allowed importation from a particular region, those 
diseases are already addressed individually in the regulations in 9 CFR 
92, 93, 94, 95, 96, and 98. Further, we do not consider List A diseases 
to fall under the scope of this rulemaking. List A diseases are defined 
by OIE as transmissible diseases that: (1) Have the potential for very 
serious and rapid spread, irrespective of national borders; (2) are of 
serious socioeconomic and/or public health consequences; and (3) are of 
major importance in the international trade of animals and animal 
products. BSE is not included as an OIE List A disease but, instead, is 
categorized as a List B disease. List B diseases are considered to be 
(1) of socioeconomic and/or public health importance within countries 
and (2) significant in the international trade of animals and animal 
products.
    With regard to product labeling in the exporting region, it is not 
clear to us from the comment what type of labeling the commenter is 
referring to.
Testing of Ruminants
    Issue: One commenter stated that, if BSE is diagnosed in a country, 
the United States should not accept ruminants and ruminant products 
from that country until the country tests all cattle over 20 months of 
age at slaughter. Other comments recommended that we require that all 
cattle slaughtered in such a country be tested for BSE. Some commenters 
recommended that such testing be carried out by USDA representatives in 
Canada.
    Response: We understand the interest expressed by some commenters 
in testing certain cattle for slaughter. However, no live animal tests 
exist for BSE and the currently available postmortem tests, although 
useful for disease surveillance (i.e., in determining the rate of 
disease in the cattle population), are not appropriate as food safety 
indicators. We know that the earliest point at which current testing 
methods can detect a positive case of BSE is 2 to 3 months before the 
animal begins to demonstrate clinical signs. We also know that the 
incubation period for this disease--the time between initial infection 
and the manifestation of clinical signs--is generally very long, on the 
average of about 5 years. Accordingly, we know there is a long period 
during which, using the current methodology, testing an infected animal 
that has not demonstrated clinical signs of the disease would, 
incorrectly, produce negative results. If, however, the infected animal 
is already exhibiting some type of clinical signs that could be 
consistent with BSE, then the test is not likely to produce false 
negative results.
    Development of reliable food safety indicators will require 
improved understanding of the pathogenesis of the disease and improved 
laboratory methods. However, if BSE is present in a country's cattle 
population, various mitigation measures, such as feed bans and removal 
of SRMs, are available to prevent the spread of BSE in cattle and to 
prevent human exposure to the BSE agent. The United States and Canada 
have already implemented such measures. The results of an enhanced 
animal surveillance program for BSE, announced by the Secretary on 
March 15, 2004 (Ref 20), and currently underway, which will help 
determine the prevalence of BSE in the United States, should the 
disease exist, and will provide information that will indicate whether 
these measures should be adjusted. But measures such as SRM removal and 
the prohibition of the use of non-ambulatory cattle in human food will 
ensure a safe meat supply. Testing of individual animals, especially if 
it is performed on clinically normal animals at slaughter, is not in 
itself an effective risk mitigation measure for protecting public 
health. The purpose of a surveillance program is to gauge the level of 
BSE prevalence. This can be achieved through targeted sampling, as is 
being carried out in the United States and Canada.
    For these reasons, we do not consider the testing at slaughter of 
every bovine over 20 months of age, or the testing of every bovine at 
slaughter, to be scientifically justified or meaningful in the context 
of either human or animal health. Making this a criterion for minimal-
risk regions would not contribute to human or animal health protection 
beyond the protection

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achieved by a statistically and epidemiologically valid surveillance 
plan, coupled with the risk mitigations specified in this rule.

B. Recognition of Canada as a Minimal Risk Region

    Issue: A number of commenters questioned whether Canada has made 
improvements to its systems (e.g., surveillance infrastructure, 
surveillance levels, removal of SRMs, feed ban compliance) sufficient 
to warrant the resumption of exports of ruminants and ruminant products 
to the United States. Other commenters contended that Canada has not 
effectively enforced its feed ban and that further investigation and 
enforcement is necessary.
    Response: Enhancements Canada has made to its surveillance levels 
are discussed above in section III. B. under the heading ``Additional 
Measures Taken in Canada'' (Ref 16). Additionally, Canada has added a 
rapid test as a routine screening tool and has expanded the number of 
laboratories approved to run BSE tests. These steps should shorten the 
interval between collection of samples and diagnosis. In July 2003, the 
Canadian Government issued requirements for the removal, 
identification, control, and disposition of SRMs (Ref 15). The Canadian 
SRM requirements for products eligible for importation into the United 
States are equivalent to requirements in the United States.
    Based on the information available to us, including communication 
with and visits to Canada, we have concluded that Canada has 
effectively enforced its feed ban. Canada implemented a feed ban in 
1997 that prohibits the feeding of most mammalian protein to ruminants. 
The Canadian feed ban is essentially the same as the feed ban in place 
in the United States. Canadian Government authorities inspect rendering 
facilities, feed manufacturers, and feed retailers to ensure compliance 
with the feed ban. Procedures to reduce the likelihood of cross-
contamination are in place at all feed mills that handle both 
prohibited and nonprohibited feeds. As discussed below under the 
heading ``Prevalence of BSE in Canada,'' CFIA indicates that compliance 
with the feed ban is very high.
    Issue: Several commenters expressed concern about the 4 months that 
passed between the death of the BSE-infected Canadian cow in January 
2003 and the diagnosis of BSE in May 2003. The commenters stated that 
this delay in diagnosis indicates that disease surveillance and 
laboratory disease diagnostic capabilities in Canada are not equal to 
those in the United States.
    Response: It is true that the May 2003 case of BSE in Canada was 
not confirmed until 4 months after the death of the animal. This delay 
was due to a combination of factors, primarily the fact that the sample 
was not identified as ``suspect'' for BSE. Samples were taken from the 
cow at slaughter because it was non-ambulatory. The animal passed ante-
mortem inspection but was condemned on post-mortem inspection for 
pneumonia. Because the cow did not display classic clinical signs of 
BSE, samples were tested as they would be for any routine surveillance 
sample. Also, because the sample was identified as part of routine 
surveillance, the laboratory did not place a high priority on it for 
testing. In order to address the delay, Canada has changed its 
surveillance approach, primarily by using rapid screening tests for 
BSE. We consider BSE surveillance and diagnostic capabilities in Canada 
to be equivalent to and as effective as those in the United States.
    Issue: One of the standards we proposed for qualification as a BSE 
minimal-risk region was that a region conduct surveillance for BSE at 
levels that meet or exceed OIE guidelines. One commenter objected to 
that standard with regard to Canada, stating OIE surveillance 
recommendations are intended for countries that have not diagnosed a 
case of BSE in native cattle. A number of commenters stated that Canada 
should not be considered a BSE minimal-risk region until that country 
increases its surveillance levels for BSE, so that the disease 
situation in Canada is better understood. Some commenters raised 
concerns that Canada's proposed level of testing was much lower than 
what the United States has proposed for U.S. testing. One commenter 
recommended that a surveillance program test all high-risk cattle in 
Canada during a period of at least 12 to 18 months.
    Response: The commenter's suggestion that OIE surveillance 
recommendations are intended for countries that have not diagnosed a 
case of BSE in native cattle is incorrect. The OIE testing guidelines 
apply to any country or zone, whether or not BSE has been diagnosed in 
a native animal. As discussed above, Canada has an adult cattle 
population of approximately 5.5 million cattle older than 24 months of 
age. The current OIE Code, Appendix 3.8.4, references adult cattle 
populations as those greater than 30 months and recommends examining at 
least 300 samples per year from high-risk animals in a country with an 
adult cattle population of 5 million, or 336 samples per year in a 
country with an adult cattle population of 7 million. Even though the 
adult cattle population in Canada is defined as greater than 24 months 
of age and OIE defines it as greater than 30 months of age, Canada has 
met or exceeded this level of surveillance for the past 7 years, thus 
exceeding the OIE guidelines. Additionally, OIE recommends sampling of 
target cattle that display clinical signs compatible with BSE and 
cattle that have died or been killed for reasons other than routine 
slaughter. Canada again exceeds OIE guidelines by conducting active 
targeted surveillance that, in addition to sampling animals that 
display clinical signs that could be considered consistent with BSE, 
includes sampling animals with risk factors for BSE.
    Also, in May 2004, the Canadian Government initiated enhancements 
of its BSE surveillance program. This enhanced surveillance program 
focuses on determining a maximum prevalence of BSE in Canada and will 
allow the Canadian Government to improve further, if necessary, the 
effectiveness of Canada's BSE risk management measures. Under the plan, 
Canada is progressively increasing the number of animals tested 
annually to be able to detect BSE at a level as low as 1 in 1 million 
animals. During 2004, through December 1, a total of more than 15,800 
samples had been obtained. Testing may reach 30,000 animals in 2005. 
This level of testing represents a significant increase over previous 
testing levels; surveillance levels in Canada have increased to current 
levels from under 500 animals per year in 1996. Canada's testing 
program, like that in the United States, focuses on those animals most 
at risk of BSE. Because the cattle population in Canada is much smaller 
than the cattle population in the United States, Canada does not need 
to test the same number of animals as the United States (where testing 
of over 200,000 animals has been announced) to reach high levels. 
Surveillance testing of 30,000 animals in Canada is equivalent to the 
U.S. target of sampling 240,000 to 300,000 animals. With the import 
requirements APHIS is establishing for live animals and products from 
Canada, there is simply no scientific basis to wait until Canada has 
completed 12 to 18 months of enhanced surveillance before allowing 
imports from that country.
    Issue: In the preamble to our proposed rule, we discussed the 
epidemiological investigation that Canada conducted after the diagnosis 
of a BSE-infected cow in Canada in May 2003. Among other things, the 
investigation focused on rendered material or feed that could

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have been derived from the carcass of the infected cow. CFIA traced the 
potential movement of material from the infected cow to rendering 
facilities and then to feed mills and determined that the risk of the 
material having been mislabeled as ruminant feed was extremely low. As 
noted below under the heading ``Other Comments Related to the Risk 
Basis for the Rule,'' as part of that investigation, a survey was 
conducted of approximately 1,800 sites that were at some risk of having 
received such rendered material or feed. The survey suggested that 99 
percent of the sites surveyed experienced either no exposure of cattle 
to the feed (96 percent of the sites) or only incidental exposure (3 
percent of the sites). We stated in our proposal that the remaining 1 
percent represented limited exposures, such as cattle breaking into 
feed piles, sheep reaching through a fence to access feed, and a goat 
with possible access to a feed bag. One commenter recommended that all 
cattle that were part of the 1 percent limited exposures be slaughtered 
before Canada is classified as a BSE minimal-risk region.
    Response: As discussed above, depopulation of Canadian herds 
possibly exposed to the feed or in question was carried out by the 
Canadian Government, which conducted a wide-ranging investigation of 
possible exposure to the feed in question and carried out depopulation 
of Canadian herds possibly exposed to the feed. On each of those farms 
where the investigation could not rule out the possibility of exposure 
to feed that may have contained rendered protein from the infected 
animal, the herds were slaughtered and tested, in each case with 
negative results.
    Issue: One commenter asked whether APHIS consulted with or sought 
the opinion of leading international scientific experts with regard to 
the proposed mitigation measures and, if so, whether those experts 
considered those risk mitigation measures adequate.
    Response: The risk mitigation measures in this rulemaking are 
equivalent to those measures considered appropriate by the OIE, which 
are guidelines developed by teams of international veterinary and other 
scientific experts. Additionally, following the diagnosis of BSE in 
Canada in May 2003, a review team of international experts evaluated 
the situation and reported favorably on the measures being taken in 
that country with regard to BSE. Those measures are equivalent to those 
set forth in this rulemaking.
    Issue: One commenter asked whether the epidemiological 
investigation conducted by Canada following the diagnosis of BSE in May 
2003 was the only information from Canada used in developing the 
proposed rule.
    Response: As we note above, APHIS was able to effectively evaluate 
the animal disease situation in Canada and risk mitigation measures 
taken by that country based on information such as the 2002 Canadian 
assessment of BSE risk in that country, the epidemiological 
investigation that Canada conducted following the diagnose of BSE in 
Canada in May 2003, and on continuing exchanges on multiple animal 
health issues, as well as on a long history of trade with Canada and 
close and continued interaction and communication with Canadian 
authorities. As discussed above in section II. C., under the heading 
``Update to APHIS'' Risk Analysis and Summary of Mitigation Measures 
and Their Applicability to Canada as a BSE Minimal-Risk Region,'' APHIS 
has developed an update to the risk analysis that APHIS conducted for 
the November 2003 proposed rule. The update elaborates on the available 
scientific information and on the analysis supporting the rule. It is 
also designed to make the process APHIS followed in evaluating the risk 
of imports from Canada more transparent (Ref 21).

C. Risk Mitigation Measures for Importation of Ruminants

How the Rule Applies to Camelids, Cervids, Bison, and Water Buffalo 
Alpacas and Other Camelids
    Issue: In Sec.  93.436 of our proposed rule, we provided that the 
importation of any ruminant from a BSE minimal-risk region would be 
prohibited unless the animal met the conditions we proposed for various 
types of live ruminants from the region. The types of ruminants for 
which we provided import conditions in Sec.  93.436 were bovines, 
ovines (sheep and goats), and cervids (e.g., deer, elk). The proposed 
provisions did not include conditions for the importation of camelids 
(llamas, alpacas, guanacos, and vicunas).
    A number of commenters stated that prohibiting the importation of 
camelids because of BSE was not justifiable. The commenters cited a 
number of reasons why camelids should be allowed importation from BSE 
minimal-risk regions, including, said the commenters, the following:
     Camelids are physiologically distinct from ruminants and 
are not true ruminants. For instance, camelids have a three-compartment 
stomach, whereas other animals considered ruminants have a four-
compartment stomach;
     Camelids are traditionally used for fiber, recreation, and 
show, rather than for food;
     Purebred registries for camelids ensure the animals' 
health and identification;
     Camelids are not fed high-protein feeds;
     Camelids are resistant to the BSE agent and do not 
transmit the disease to other camelids or any other species; and, in 
fact, no camelid has been diagnosed with a TSE;
     Prohibiting camelids from a BSE minimal-risk region would 
not be consistent with OIE guidelines, both because the OIE guidelines 
on BSE relate only to bovines, and because OIE recommends that an 
importing country not be more trade-restrictive than necessary to 
achieve the desired level of protection.
    Other commenters recommended ways of tracking the location of 
camelids in the United States if they were allowed importation from BSE 
minimal-risk regions. One commenter requested that camelids that had 
been exported from the United States to Canada for breeding purposes 
before the May 2003 diagnosis of BSE in Canada be allowed to be 
returned to their original U.S. premises.
    Response: Although we agree that taxonomic differences exist 
between camelids and ruminants such as cattle, sheep, and goats, we do 
not consider those differences to be sufficient to exclude camelids 
from being regulated as ruminants with regard to most diseases of 
concern. Regardless of their taxonomic classification, camelids meet 
the definition of ruminants and are susceptible to ruminant diseases, 
including foot-and-mouth disease and tuberculosis. However, with regard 
to BSE, we agree it is not necessary to prohibit the importation of 
camelids from minimal-risk regions. Although we recognize there are 
unknowns with regard to susceptibility to BSE, given the mitigation 
measures that must be in place for a region to be recognized as minimal 
risk for BSE, and the facts that there have been no diagnosed cases of 
BSE in camelids and that camelids are not typically fed ruminant 
byproducts, we agree it would be highly unlikely BSE would be 
introduced into the United States through the importation of camelids 
from BSE minimal-risk regions.
    Therefore, in this final rule, we are providing in Sec.  93.436(f) 
that camelids from a BSE minimal-risk region may be imported into the 
United States without any restrictions related to BSE. However, such 
animals will continue to be subject to all other applicable import

[[Page 478]]

requirements in part 93, subpart D, for ruminants imported into the 
United States. We are also amending Sec.  93.400 of the regulations to 
add a definition of camelid to mean all species in the family 
Camelidae, including camels, llamas, alpacas, guanacos, and vicunas.
    Issue: One commenter questioned why we proposed restricting the 
importation of alpacas because of BSE but not the importation of mink, 
felines, and mice, which are also susceptible to certain TSEs. Another 
commenter questioned why the restrictions regarding BSE in the 
regulations apply only to four-stomached animals, despite the fact that 
certain single-stomached animals have been be shown to be susceptible 
to BSE and that certain other animals, such as horses, also eat animal 
byproducts. One commenter asked whether the occurrence of the disease 
in single-stomached animals suggests that the root cause of BSE may be 
the environment and that the disease has not been adequately defined.
    Response: Although BSE belongs to the family of diseases known as 
TSEs, and certain species other than those classified as ruminants have 
been known to be infected with some form of TSE, natural infections of 
BSE have been confirmed only in cattle, other bovines, some zoo animals 
including exotic felines, and domestic cats. Experimental infections of 
BSE can be induced in certain other species, such as mice and sheep. 
Animals that have been experimentally inoculated with BSE are 
prohibited entry into the United States except for entry under permit 
for research. Zoological animals are restricted to entry under permit 
to recognized zoological parks. Research indicates that BSE spreads 
primarily through the ingestion of ruminant feed containing protein and 
other products from ruminants infected with BSE. Because domestic 
felines (1) are rarely infected with BSE, even in BSE high-risk 
regions, (2) are generally not rendered for animal feed, and, (3) if 
rendered, are precluded from ruminant feed by the FDA feed ban, the 
importation of domestic felines from BSE-affected regions is not 
considered a significant risk. We do not have any evidence to suggest 
that it is necessary to establish prohibitions or restrictions on the 
importation of non-ruminant animals because of BSE.
Cervids
    Issue: In our proposed rule, we included provisions for the 
importation of live cervids from a BSE minimal-risk region, but only if 
such cervids were to be moved directly to slaughter in the United 
States and met other conditions, including that the cervids not be 
known to have been fed ruminant protein, other than milk protein, 
during their lifetime. One commenter stated that it would be impossible 
to verify the feeding practices for cervids. Conversely, a number of 
commenters stated that our proposed provisions regarding cervids were 
too stringent. A number of commenters stated that live cervids should 
be allowed importation for any reason from BSE minimal-risk regions. 
Several pointed out that BSE has not been identified in cervids. 
Several commenters recommended specific conditions for the importation 
of live cervids for any reason from a BSE minimal-risk region. One 
recommended that the cervids be farmed animals originating from herds 
that have participated for at least 3 years in a CWD surveillance 
program. Another commenter recommended that it be required that the 
cervids were born after implementation of the required feed ban, were 
not known to have been fed ruminant proteins prohibited under the feed 
ban, are identified by permanent identification enabling tracing of the 
animal back to the herd and dam of origin, and were members of a herd 
that participates in a TSE surveillance program and that is not known 
to have been affected with a TSE.
    Response: In this final rule, we are not including restrictions on 
the importation of cervids from a BSE minimal-risk region for reasons 
relating to BSE. The import restrictions we proposed took a 
conservative approach in that they were based on evidence of cervid 
susceptibility to CWD, rather than susceptibility to BSE. We 
extrapolated from CWD susceptibility of cervids to predict a 
theoretical risk that cervids might also be susceptible to BSE. 
However, APHIS, like many of the commenters, is aware of no 
epidemiological data indicating cervids are naturally susceptible to 
the BSE agent. Published observations indicate that, during the height 
of the BSE outbreak in 1992 and 1993 in the United Kingdom, exotic 
ruminants of the Bovidae family in zoos were affected with BSE, while 
cervids, which are members of the Cervidae family, were not (Ref 22). 
Therefore, even in regions that have high levels of circulating 
infectivity and that should be considered high risk for BSE, BSE 
susceptibility in cervids was not observed.
    Although specific challenge studies have not been conducted to 
evaluate the experimental infectivity of BSE in cervids, natural 
infection has not been observed. At least some of the certification 
requirements for cervids in the proposed rule were focused on TSEs in 
general rather than BSE specifically. For example, the proposed 
requirements included certification that the cervids had been members 
of a herd that was subject to TSE surveillance and that was not known 
to be infected with or exposed to a TSE. Upon reconsideration, APHIS 
concluded that restrictions relating to general TSE-related factors in 
the absence of demonstrated BSE in cervids would be outside the scope 
of this regulation, which was intended to focus on BSE.
    In addition, it should be noted that Canada, as a BSE minimal-risk 
region, is not likely to have high circulating levels of the infectious 
agent. Since no infected cervids were observed in captive zoo cervids 
(unlike in other bovine species) in the United Kingdom at a time when 
there were high levels of circulating infectivity, it is unlikely that 
infected cervids will be detected in a BSE minimal-risk region. 
Therefore, the available information suggests that importation of 
cervids from Canada does not pose a risk of importing BSE into the 
United States.
    APHIS considers these observations to be evidence suggesting that 
cervids from BSE minimal-risk regions should not be restricted for BSE, 
even in view of the fact that no controlled studies have been conducted 
on cervid susceptibility to BSE. Although APHIS is not restricting 
cervids for BSE, it will maintain requirements related to cervids for 
other diseases, including CWD. General surveillance for CWD will detect 
any TSE exposure, thus providing additional assurances.
    We are adding a definition of cervid to Sec.  93.400 to mean all 
members of the family Cervidae and hybrids, including deer, elk, moose, 
caribou, reindeer, and related species. This definition is the same as 
the definition of cervid used in 9 CFR part 55 with regard to CWD. 
Additionally, we are amending the definition of cervid in Sec.  94.0 to 
also be consistent with the definition in Sec.  55.1.
    Issue: One commenter recommended that the regulations require that 
all cervids imported into the United States from Canada be tested for 
TSEs such as CWD.
    Response: We are making no changes based on the comment. There is 
no evidence that cervids affected with CWD pose a risk for BSE and we 
do not consider such testing warranted.
Bison and Water Buffalo
    Issue: Many of the provisions in our proposed rule had to do with 
the importation of bovines and bovine products from a BSE minimal-risk 
region. Several commenters asked that

[[Page 479]]

the regulations include a definition of bovine and that such a 
definition make it clear whether ``bovine'' includes bison and water 
buffalo.
    Response: We are adding a definition of bovine to the definitions 
in Sec. Sec.  93.400, 94.0, and 95.1 to mean Bos taurus (domestic 
cattle), Bos indicus (zebu cattle), and Bison bison (American bison). 
These types of bovines were those for which our risk assessment 
determined whether the proposed risk mitigation measures would be 
appropriate. Water buffalo may not be imported into the United States 
under this rule.
    Issue: Several commenters recommended that the restrictions and 
prohibitions for bovines in this rule not apply to bison because of 
husbandry and feeding practices within the bison industry. At the 
least, said the commenters, bison should be allowed entry into the 
United States from Canada if they were born after the required feed ban 
and were fed no ruminant protein. The commenters stated that, among 
other factors, there has never been a reported case of BSE in bison in 
North America, farmed bison are not fed high-levels of protein and are 
not fed animal byproducts under industry association codes, and bison 
in Canada have been under a disease surveillance program since 1992.
    Response: We are making no changes based on these comments. The 
reference to bovines in the proposed rule included bison. As such, live 
bison may be imported from BSE minimal-risk regions subject to the same 
conditions as other bovines. Published information from the United 
Kingdom (Ref 22) indicates that, along with other bovines, bison are 
susceptible to BSE. Because such susceptibility has been demonstrated, 
we do not consider it prudent to assume that voluntary industry 
practices will be sufficient safeguards against the disease.
    Issue: Another commenter wanted to eliminate obstacles to importing 
wood bison from Canada for conservation and restoration projects in 
Alaska.
    Response: We will consider this comment in developing our planned 
rulemaking regarding the importation from BSE minimal-risk regions of 
live bovines other than those addressed in our November 2003 proposed 
rule.
Identification of Bovines, Sheep, and Goats From BSE Minimal-Risk 
Regions
    Issue: In Sec.  93.436(b)(3) and (d)(3) of our proposed rule, we 
included the requirement that for bovines, sheep, and goats imported 
from a BSE minimal-risk region for feeding and then slaughter, the 
inside of one ear on each animal be permanently and legibly tattooed 
with letters identifying the exporting country, and that animals 
exported from Canada be tattooed with the letters ``CAN.'' Several 
commenters said tattoos were not sufficient to permanently identify 
animals because such markings can become illegible over time and cannot 
be effectively monitored without restraining the animal. Other 
commenters stated that ear tattoos can be obscured by dirt and hair, 
are not readily visible--particularly on animals with dark-skinned 
ears--and are difficult to apply under winter conditions. A number of 
commenters recommended that identification of country of origin by hot 
iron branding be required for cattle imported for feeding from BSE 
minimal-risk regions.
    Response: We agree that tattoos might not provide effective, 
readily visible, permanent identification of the country of origin of 
bovines. Therefore, we are requiring in Sec.  93.436(b)(3) that bovines 
imported for feeding and then slaughter from a BSE minimal-risk region 
be permanently and humanely identified before arrival at the port of 
entry with a distinct and legible mark identifying the exporting 
country, properly applied with a freeze brand, hot iron, or other 
method, and easily visible on the live animal and on the carcass prior 
to skinning, unless the bovine is imported for immediate slaughter in 
accordance with Sec.  93.429. The mark must not be less than 2 inches 
or more than 3 inches high, and must be applied to each animal's right 
hip, high on the tail-head (over the junction of the sacral and first 
cocygeal vertebrae). Animals exported from Canada must be so marked 
with ``CAN''.
    We are also requiring in this final rule that a brand or other 
specified form of permanent identification be used to mark sheep and 
goats that are imported for feeding and then slaughter. We are 
providing in Sec.  93.419(d)(1) that sheep and goats imported for 
feeding and then slaughter from a BSE minimal-risk region be 
permanently identified before arrival at the port of entry. We will 
require humane identification with a distinct, permanent, and legible 
mark identifying the exporting country, properly applied with a freeze 
brand, hot iron, or other method before arrival at the port of entry, 
and easily visible on the live animal and on the carcass prior to 
skinning. The mark must be not less than 1 inch or more than 1\1/4\ 
inches high. In all cases, the permanent identification must identify 
the country of export. Animals exported from Canada must be so marked 
with ``C''.
    Additionally, we are providing that other means of permanent 
identification may be used upon request if deemed by the APHIS 
Administrator as adequate to humanely identify the animal in a distinct 
and legible way as having been imported from the BSE minimal-risk 
region.
    Issue: One commenter recommended that the regulations provide that 
cattle requiring the identifying mark be branded on the left cheek.
    Response: Although we agree that branding should be required for 
cattle imported for feeding from a BSE minimal-risk region, we disagree 
it is necessary to require that the brand be applied to the cheek of 
the animal. Facial branding is more stressful for cattle than branding 
the hind quarters. We consider a brand on the right hip to be adequate 
for quick identification of the animal as an export from a BSE minimal-
risk region.
    Issue: Several commenters recommended that all live cattle that 
have been imported into the United States from Canada be permanently 
identified with a hot iron brand.
    Response: We do not consider the action requested by the commenters 
necessary. Canada, like the United States, was proactive in 
implementing a BSE prevention program. Canada has had a ruminant feed 
regulation in place since 1997. Canada prohibited the importation of 
live cattle from the United Kingdom and the Republic of Ireland 
starting in 1990, and subsequently applied the same prohibitions to 
additional countries as those countries identified native cases of BSE. 
In 1996, Canada made this policy even more restrictive and prohibited 
the importation of live ruminants from any country that had not been 
recognized as free of BSE. Canada has also conducted surveillance in 
high-risk cattle to monitor the effectiveness of these measures. The 
combination of these factors makes Canadian-origin cattle currently 
located in the United States a very low risk for infection with BSE 
and, in combination with the safeguards in place in the United States, 
makes them very unlikely to cause the amplification of BSE in U.S. 
cattle or pose a health risk to U.S. consumers.
    The identification recommended by the commenters would require the 
use of significant resources of time, personnel, and funding, and would 
provide in return information that is of minimal value. The question 
that must be answered is whether BSE is present in the U.S. cattle 
population. This can be done only through the extensive targeted 
surveillance program underway in the United States. Canadian-origin 
animals will be included in targeted

[[Page 480]]

surveillance efforts being carried out in this country. Attempting to 
track Canadian imports--animals that are not contributing significantly 
to increased risk at this time--will serve only to draw resources away 
from the targeted surveillance efforts.
    Issue: One commenter recommended that the regulations require that 
cattle imported from a BSE minimal-risk region for immediate slaughter 
be electronically identified as part of a recognized national system.
    Response: We are making no changes based on this comment. We 
consider the sealing requirements for the means of conveyance 
transporting the animals adequate to ensure immediate slaughter of the 
animals.
    Issue: One commenter stated that the requirement for permanently 
identifying sheep and goats probably violates international agreements 
that forbid a country from applying health or food safety standards to 
foreign products that are not met by domestically produced products. 
The commenter stated that, because the BSE statuses of Canada and 
United States are now similar, similar standards should be adopted.
    Response: We are making no changes based on the comment. BSE has 
been detected in two cows indigenous to Canada, whereas a BSE-infected 
animal indigenous to the United States has not be detected to date. The 
domestic animal health regulations that govern interstate movement in 
the United States are based on differences in disease status among 
States. Because the United States makes no distinctions among States 
with regard to BSE, a tattoo requirement would be meaningless for 
interstate movements.
    Issue: One commenter recommended that permanent marking with a 
brand or tattoo be required for all livestock imported into the United 
States, unless the animals are moved in a sealed conveyance to 
immediate slaughter.
    Response: We do not consider it necessary to apply the permanent 
marking requirements of this rule to all livestock imported into the 
United States. The purpose of the branding requirement in this rule for 
cattle, sheep, and goats is to allow for quick and easy identification 
of the animals as having been imported from a BSE minimal-risk region, 
not to track the animals.
    Issue: A number of commenters recommended that, to be able to more 
effectively maintain identity of animals imported from a BSE minimal-
risk region for feeding and then slaughter, and to be able to trace the 
animals back to the premises of origin, some form of individual 
identification should be required, such as an eartag. Some commenters 
stated that the identification should allow for tracing back to the 
animal's dam.
    Response: We agree that it is important to be able to trace cattle, 
sheep, and goats that are imported from a BSE minimal-risk region for 
feeding and then slaughter back to the animals' premises of origin, and 
concur that an eartag can be an effective method of individual animal 
identification. Therefore, we are requiring in Sec.  93.436(b)(4) for 
bovines and in Sec.  93.419(d)(2) for sheep and goats that an eartag of 
the country of origin that is determined by the Administrator to meet 
the standards for official eartags in the United States and to be 
traceable to the premises of origin (which we are defining in Sec.  
93.400 as the premises where the animal was born) be applied to 
bovines, sheep, and goats imported for feeding and then slaughter, 
before the animals' entry into the United States. We do not, however, 
consider it necessary to require that the eartag make it possible to 
trace the animal back to its dam. If an infected animal is diagnosed, 
epidemiological investigation and, if necessary, depopulation will 
involve all animals of potential concern in the herd of origin.
    Issue: Several commenters recommended that we require maintenance 
of individual identification of imported animals throughout the 
lifetime of each animal.
    Response: We agree that removal of the animal's individual 
identification would prevent USDA from reconciling the required APHIS 
movement forms to confirm that all animals are slaughtered as required. 
Therefore we are requiring in Sec.  93.436(b)(4) for feeder bovines, 
and Sec.  93.419(d)(2) for feeder sheep and goats, that no person may 
alter, deface, remove, or otherwise tamper with the individual 
identification placed on each animal that is in the United States or 
moving into or through the United States and that such identification 
may be removed only at slaughter.
    Issue: One commenter recommended that APHIS require electronic 
identification for cattle, sheep, and goats, in addition to the 
permanent identification.
    Response: As discussed above, we are requiring individual 
identification of bovines, sheep, and goats imported from BSE minimal-
risk regions for feeding and then slaughter. However, the national 
animal identification plan announced by the Secretary of Agriculture on 
March 15, 2004, does not mandate the use of any particular technology, 
including electronic identification, and we are not requiring that the 
individual identification under this rule be electronic. Further, there 
is little infrastructure for reading electronic identification devices 
in the United States. Therefore, individual identifications would still 
require visual reading.
    Issue: One commenter recommended that, for bovines less than 30 
months of age, we require eartags that allow traceback to the producer 
of origin with verification for ownership history, movement history, 
and compliance with the ruminant feed ban. This commenter and other 
commenters recommended that we require that the eartags be a form of 
electronic identification.
    Response: As we discussed above for cattle imported into the United 
States from a BSE minimal-risk region for feeding and then slaughter, 
we are requiring that an official eartag of the country of origin that 
is determined by the Administrator to meet the standards for official 
eartags in the United States and to be traceable to the premises of 
origin be applied to the animal before its entry into the United 
States. With regard to cattle from Canada, since January 1, 2001, 
Canada has required all cattle to be identified with machine-readable 
eartags (radio frequency identification or bar coded) that would allow 
them to be traced to their herd of origin within Canada. With regard to 
verification of feed ban compliance, this rule requires that such 
verification accompany cattle exported to the United States in the form 
of a certificate issued either by a full-time salaried veterinary 
officer of the national government of the region of origin, or by a 
veterinarian designated or accredited by the national government of the 
region of origin and endorsed by a full-time salaried veterinary 
officer of the national government of the region of origin. We do not 
consider it necessary or practical for the individual animal 
identification to also be a means of verifying individual on-farm 
compliance with the feed ban regulations. As discussed above, we also 
do not consider it practical at this time to require that the 
identification be electronic, due to the fact that such identification 
would require availability and general use of readers, which is 
currently not the case.
    Issue: Several commenters requested that the proposed requirement 
for an ear tattoo be replaced in the case of bison with a requirement 
for an electronic eartag.
    Response: As discussed above, we agree with the need for an eartag 
as a means of tracing animals to their premises of origin. However, we 
consider it necessary that the animal also be marked in some permanent 
and

[[Page 481]]

easily visible way as having been imported from a BSE minimal-risk 
region. In the case of bison from Canada, this would be a brand or 
other permanent ``CAN'' mark on the right hip. The hip brand is 
necessary so that bovines from a BSE minimal-risk region that are not 
imported for immediate slaughter can be easily identified as such in 
feedlots and at slaughter or if they are illegally diverted from the 
feeder/slaughter chain. The purpose of the mark is to provide permanent 
identification and eartags cannot be relied upon to be permanent 
identification.
    Issue: Several commenters recommended that APHIS allow the use of 
forms of individual identification other than those specified in the 
regulations, provided such means of identification are deemed 
acceptable by the APHIS Administrator. One commenter stated that APHIS 
should not limit the use of acceptable technologies to identify animals 
from BSE minimal-risk regions. Instead, APHIS should establish 
standards for animal identification and traceability systems.
    Response: We agree that there may be acceptable means of 
identifying animals in addition to those we are specifying and, as 
stated above, have provided for approval by the Administrator of other 
adequate means of identification. At this time, U.S. standards for 
animal identification and traceability are under development and will 
be made available for public comment in future rulemaking.
    Issue: One commenter stated that we should allow retinal vascular 
imaging as a form of animal identification.
    Response: At this time, we do not consider retinal scanning alone 
to provide adequate identification of animals because the scans cannot 
be performed more than a few hours after death. Due to tissue 
deterioration, it is extremely difficult to obtain a valid scan.
Movement to Feedlots and Then to Slaughter
    Issue: We proposed to require that bovines, sheep, and goats 
imported from a BSE minimal-risk region for feeding and then slaughter 
be moved directly from the port of entry to a designated feedlot. We 
proposed to define designated feedlot in Sec.  93.400 as ``a feedlot 
indicated on the declaration required under Sec.  93.407 as the 
destination of the ruminants imported into the United States.'' 
Paragraph (b) of Sec.  93.407 requires presentation by the importer of 
a declaration for imported ruminants that includes, among other 
information, the name of the person to whom the ruminants will be 
delivered and the location of the place to which such delivery will be 
made. Several commenters asked how APHIS will verify that imported 
cattle moved to a feedlot were not moved from the feedlot other than to 
slaughter. Many commenters requested that the regulations include 
criteria for approval of a feedlot as a designated feedlot. A number of 
commenters recommended specific criteria for such approval.
    Response: Based on these comments, we consider it necessary to 
clarify our intent as to what we meant by a designated feedlot in the 
proposal and where and how we are using that term in this final rule.
    In this final rule, we are still requiring, as proposed, that 
cattle from a BSE minimal-risk region imported into the United States 
for feeding and then slaughter (which we refer to as feeder cattle) 
must be moved from the port of entry to an identified feedlot, but we 
are not calling that feedlot a ``designated feedlot.'' In our proposal, 
it was our intent that a feedlot for cattle be ``designated'' only in 
the sense that it was identified as the location to which the cattle 
would be moved for feeding and then movement to slaughter. We did not 
specify criteria for designated feedlots for either cattle or sheep and 
goats and did not require that cattle from BSE minimal-risk regions be 
segregated from other cattle at feedlots. Because there has been no 
demonstrated lateral transmission of BSE from bovine to bovine (the 
most likely cause or transmission in bovines appears to be through 
ingestion of infected ruminant protein), we considered it sufficient to 
ensure that the imported cattle be clearly marked as to country of 
origin.
    FSIS's January 2004 SRM rule, discussed above under the heading 
``Measures Implemented by FSIS,'' which requires that SRMs be removed 
from all cattle at slaughter--both from cattle born and raised in the 
United States and from imported cattle--further supports the conclusion 
that it is not necessary to require segregation of imported feeder 
cattle from U.S. feeder cattle while at a feedlot before slaughter. 
Individual identification, permanent marking indicating the country of 
origin, and movement only under an APHIS-issued movement permit (the 
physical destination of the cattle must be identified on all documents 
described in Sec.  93.407 and on APHIS Form VS 17-130) will allow 
monitoring and tracking of the imported cattle as they move from the 
port of entry to the identified feedlot and then to a recognized 
slaughtering establishment. This process is as follows.
    Movement of cattle to feedlots and then to slaughter. Means of 
conveyance containing cattle for feeding and then slaughter will be 
presented to an APHIS port veterinarian at a border port listed in 
Sec.  93.403(b) or as provided in Sec.  93.403(f). These cattle must be 
accompanied by the health certificate from the region of origin (in 
this case Canada) that is required under Sec.  93.405. The health 
certificate must list the eartag number of each of the animals in the 
shipment. Additionally, the animals must be accompanied by the 
certification required from the country of origin under Sec.  
93.436(b)(5) regarding the age, feeding history, and identification of 
the cattle. The means of conveyance must have been sealed in the region 
of origin with seals of the national government of the region of 
origin. (The requirement for sealing of the vehicle is discussed below 
under the heading ``Sealed Means of Conveyance.'')
    The APHIS port veterinarian will review the paperwork and inspect 
the shipment to ensure that it is being imported in compliance with the 
regulations. The APHIS port veterinarian will then complete and sign 
APHIS Form VS 17-30, ``Report of Animals, Poultry, or Eggs Offered for 
Importation.'' (This is a standard form completed by APHIS port 
veterinarians as certification of the inspection and release of animals 
offered for importation from any region.) The APHIS port veterinarian 
will also complete and sign APHIS VS Form 17-130, ``Permit for Movement 
of Restricted Animals,'' which will authorize the movement of the 
animals to a feedlot. The APHIS VS Form 17-130, which must identify the 
physical location of the feedlot and the individual responsible for the 
movement of the animal, must also be signed by the owner or the shipper 
of the animals, to certify that the livestock will be delivered to the 
consignee without diversion.
    The cattle must be moved as a group to the feedlot indicated on the 
APHIS VS Form 17-130. When the cattle arrive at the feedlot, the seal 
must be broken only by an accredited veterinarian or by a State or USDA 
representative or his or her designee. The person breaking the seal 
will indicate on the APHIS VS Form 17-130 where and when the animals 
were received and the number of animals received, as well as the date 
and time the seal was broken. The form will be signed by the person 
breaking the seal and a copy sent to the APHIS Area Office or Regional 
Office. APHIS or

[[Page 482]]

State officials may spot-check this process at the feedlot. (In this 
final rule, we are adding a definition of State representative to the 
definitions in Sec.  93.400 to mean a veterinarian or other person 
employed in livestock sanitary work of a State or a political 
subdivision of a State who is authorized by such State or political 
subdivision of a State to perform the function involved under a 
memorandum of understanding with APHIS. This definition is consistent 
with the definition of State representative as used elsewhere in the 
APHIS regulations. Section 93.400 already includes a definition of 
accredited veterinarian.)
    Once at the feedlot designated on the import documents and the 
movement permit, the cattle must remain there until transported to a 
recognized slaughtering establishment and must not be moved to 
different feedlots, onto range, or to cattle sales. As provided in 
Sec.  93.436(b)(4) regarding individual identification by eartag of 
each animal, the eartag required under this rule must not be removed 
from any of the animals. The feedlot operator must be able to account 
for all incoming cattle from BSE minimal-risk regions--those sent to 
slaughter and those that die at the feedlot.
    When the cattle are to be sent to slaughter, an accredited 
veterinarian or a State or USDA employee must complete APHIS VS Form 1-
27 at the feedlot and seal the means of conveyance. The APHIS VS Form 
1-27, which must identify the physical location of the recognized 
slaughtering establishment and the individual responsible for the 
movement of the animal, must also be signed by the owner or the shipper 
of the animals, certifying that the livestock will be delivered to the 
consignee without diversion. This APHIS Form VS 1-27 must accompany the 
cattle to the slaughtering establishment, along with a copy of the 
APHIS VS Form 17-130 and the health certificate that accompanied the 
animals from the port of entry to the feedlot. Upon arrival of the 
means of conveyance at the slaughtering establishment, a USDA 
representative will break the seal, complete the APHIS VS Form 1-27, 
and return all the paperwork that accompanied the animals to either the 
APHIS Area Office or Regional Office. Although we acknowledge that this 
process will involve time and costs for the importer and the feedlot 
owner, it will provide APHIS with a means of monitoring the movement of 
these shipments. However, following implementation of the National 
Animal Identification System currently under development, we will 
evaluate the effectiveness of tracking these shipments by the national 
identification system compared to tracking by means of the documents 
required by this rule. In recognition of the possibility that 
alternative effective means of monitoring movement may be developed, we 
are providing in this final rule that the animals shipped must be 
accompanied by the movement documentation described above or other 
movement documentation deemed acceptable by the Administrator.
    Movement of sheep and goats to feedlots and then to slaughter. The 
requirements in this final rule for the movement of feeder sheep and 
goats from a BSE minimal-risk region from the port of entry to a 
feedlot and then to slaughter are the same as those described above for 
the movement of cattle. However, provisions regarding the feedlots 
themselves for sheep and goats are more detailed than those for cattle, 
due to the fact that transmission of BSE among sheep and goats could 
potentially differ from transmission among bovines. In this final rule, 
we are using the term ``designated feedlot'' for the feedlot of 
destination of the sheep and goats. We discuss the criteria and 
rationale for designated feedlots for sheep and goats below under the 
heading ``Designated Feedlots for Sheep and Goats.''
    Issue: With regard to ruminants moved to a U.S. feedlot and then to 
slaughter, one commenter asked whether APHIS or FSIS would verify that 
the animals are properly permanently identified.
    Response: The accredited veterinarian who issues the APHIS VS Form 
1-27 for movement to slaughter will verify that the required 
identification is on the animal and record it on the form.
    Issue: Several commenters recommended that the regulations require 
that means of conveyance carrying livestock from BSE minimal-risk 
regions to feedlots (i.e., feeder cattle) in the United States be 
sealed at the border. Several commenters questioned why cattle for 
immediate slaughter must be moved as a group, but those going to a 
designated feedlot will be allowed to be moved to slaughter at varying 
times and to different slaughter facilities. The commenters said this 
defeats the purpose of control over and traceback of imported animals. 
Another recommended that the rule clarify how bovines from BSE minimal-
risk regions sent to designated feedlots will be kept separate from 
U.S. bovines. Several commenters expressed concern that the potential 
diversion of feeder cattle would result in their being over 30 months 
of age when slaughtered. A number of commenters recommended that the 
possibility of the diversion of feeder cattle for breeding use could be 
eliminated by requiring that feeder cattle from BSE minimal-risk 
regions be neutered before importation. Other commenters recommended 
that feeder cattle from Canada be required to be moved to quarantined 
feedlots.
    Response: All of the above comments were in response to our 
proposal to allow feeder cattle to be imported from BSE minimal-risk 
regions provided they were moved to a designated feedlot as a group, 
then were moved directly to slaughter. These comments were made based 
on the premise that, to be in accord with the proposed requirements, 
Canadian feeder cattle needed to be segregated from U.S. feeder cattle. 
However, because of the identification and movement requirements 
discussed above and the recent FSIS requirements for the removal of 
SRMs from all cattle at slaughter in the United States, we do not 
consider it necessary to segregate Canadian and U.S. feeder cattle.
    However, as an added safeguard that the animals are moved directly 
from the port of entry to a feedlot and from the feedlot to a 
recognized slaughtering establishment, we are requiring in this final 
rule that means of conveyance carrying feeder cattle from the U.S. port 
of entry to a feedlot have been sealed in the region of origin with 
seals of the national government of the region of origin. We are 
providing that such seals must be broken only at port of entry by the 
APHIS port veterinarian or at the feedlot by an accredited veterinarian 
or a State or USDA representative or his or her designee. If the seals 
are broken by the APHIS port veterinarian at the port of entry, the 
means of conveyance must be resealed with seals of the U.S. Government 
before being moved to the feedlot. We are also requiring that means of 
conveyance carrying cattle from the feedlot to a slaughtering 
establishment be sealed with seals of the U.S. Government before 
leaving the feedlot.
    Issue: One commenter stated that neutered male animals should be 
allowed to utilize range resources without having to go directly to 
confined feedlots.
    Response: This rule requires that the physical location of the 
cattle be identified. Because of the inherent difficulties involved in 
identifying and gathering those cattle on range that were imported from 
a BSE minimal-risk region and must be slaughtered before they are 30 
months of age, we are not providing that feeder cattle imported from a 
BSE minimal-risk region may be placed on range. They must be put into

[[Page 483]]

the feedlot identified on the APHIS movement permit and other 
accompanying documentation to help ensure they are slaughtered in a 
timely manner.
Maximum Age of Cattle, Sheep, and Goats Imported From a BSE Minimal-
Risk Region
    Issue: APHIS proposed to limit live cattle imported from a BSE 
minimal-risk region to those that would be less than 30 months of age 
at slaughter. A number of commenters expressed concerns regarding that 
maximum age. The commenters stated that, because there have been 
multiple detections of BSE in cattle less than 30 months of age in 
Europe and Japan, APHIS should decrease the maximum age for imports. 
Recommended maximums ranged from 18 to 28 months of age. Several 
commenters requested that APHIS more comprehensively state and validate 
the scientific basis for determining that cattle in the 20 to 30 month 
age range do not present a risk of BSE. Another commenter cited 
evidence from Britain that the commenter said indicates some cattle may 
be fast incubators of the disease and, therefore, have the potential to 
introduce detectable levels of BSE into the food chain. One commenter 
expressed concern that, because bulls are routinely slaughtered at 19 
to 22 months old, they may be too young to test positive for the 
disease, even though those animals may be infected with BSE. One 
commenter stated that with prion diseases, the incubation time tends to 
become shorter the longer a specific prion has been circulating within 
a species.
    Response: As discussed in our proposal, pathogenesis studies--where 
tissues obtained from orally infected calves were assayed for 
infectivity--have illustrated that levels of infectious BSE agent in 
certain tissues vary with the age of an animal. Infectivity was not 
detected in most tissues in cattle until at least 32 months post-
exposure. The exception to this is the distal ileum (a part of the 
intestines), where infectivity was confirmed in the experimentally 
infected cattle as early as 6 months post-exposure, and the tonsils, 
where infectivity was confirmed at 10 months post-exposure.
    Research demonstrates that the incubation period for BSE in cattle 
is linked to the infectious dose received--i.e., the larger the 
infectious dose received, the shorter the incubation period. While some 
cases of BSE have been found in cattle less than 30 months of age, 
these are relatively few and have occurred in countries with 
significant levels of circulating infectivity (i.e., where infected 
ruminants are used for feed for other ruminants, which in turn become 
infected).
    In our proposal, we set out a list of standards we will use to 
evaluate the BSE risk from a region and determine whether it is 
appropriate to classify that region as a region of minimal-risk for 
BSE. We stated that we would use these standards as a combined and 
integrated evaluation tool, basing a BSE minimal-risk classification on 
the overall effectiveness of control mechanisms in place (e.g., 
surveillance, import controls, and a ban on the feeding of ruminant 
protein to ruminants). Given the low level of circulating infectivity 
in minimal-risk regions, we proposed a 30-month age limit for cattle 
and proposed that the intestines be removed from those imported cattle. 
As discussed already, following the detection of a BSE-positive cow in 
Washington State in December 2003, FSIS implemented additional measures 
to protect the human food supply in the United States--including a 
requirement that SRMs be removed from all cattle--and prohibited the 
use of SRMs in human food.
    Under these circumstances, we continue to consider 30 months of age 
to be the appropriate age threshold for removal of most SRMs. We are 
evaluating whether cattle over 30 months of age could be safely 
imported into the United States from a BSE minimal-risk region under 
the same conditions as younger cattle, since SRM removal is now 
standard operating procedure for all cattle 30 months of age and older 
that go to slaughter in the United States. However, we are not making a 
change with regard to live cattle over 30 months of age in this final 
rule, because, as stated in our March 8, 2004, notice, we are currently 
evaluating the appropriate approach regarding live cattle other than 
those specified in our proposal and intend to address that issue in a 
supplemental rulemaking proposal in the Federal Register.
    Issue: Several commenters asked why we proposed that live sheep and 
goats 12 months of age and older would not be allowed importation into 
the United States. One commenter noted that we said in our proposal 
that we would allow cattle less than 30 months of age to be imported 
from BSE minimal-risk regions because BSE infectivity was not detected 
in most tissues in cattle until at least 32-months post-exposure to the 
agent. In contrast, said the commenter, although we stated BSE 
infectivity has not been demonstrated in most tissues in sheep and 
goats until 16 months post-exposure, we proposed to prohibit the 
importation of live sheep and goats 12 months of age or older from a 
BSE minimal-risk region. The commenter noted that APHIS was 
establishing a safety margin of 2 months for cattle (6.25 percent) (32 
months/30 months), but 4 months (25 percent) for sheep and goats. The 
commenter requested that APHIS provide the scientific basis for 
determining whether this distinction is significant.
    Response: As noted above, research has indicated that the levels of 
infectious agent in certain tissues vary with the age of an animal. 
Infectivity in cattle was not detected in most tissues until the animal 
was at least 32 months post-exposure. In sheep and goats, infectivity 
has not been demonstrated in most tissues until 16 months of age post-
exposure. The 30-month age limit for cattle imported from minimal-risk 
regions is accepted internationally in BSE standards set by various 
countries and is consistent with OIE guidelines and target surveillance 
(Ref 23). We proposed a 12-month age limit for sheep and goats based on 
the research regarding infectivity in such animals and, practically 
speaking, because 12 months is consistent with the age at which lambs 
are generally sent to slaughter.
    Issue: Several commenters recommended that, rather than using the 
age of an animal as a risk mitigation measure, APHIS should follow OIE 
guidelines that allow the movement of cattle born after an effective 
feed ban was implemented, provided appropriate risk mitigation measures 
are applied during slaughter and processing.
    Response: The import conditions proposed by APHIS for importation 
of bovines for immediate slaughter from BSE minimal-risk regions 
included several restrictions, including both age of the animal and the 
requirement that the animal not be known to have been fed ruminant 
protein. Those conditions were analyzed together in our risk analysis, 
which did not differentiate among the efficacy of the alternative risk 
mitigation options. Based on that analysis of risk, we are including 
both conditions in this final rule.
    Issue: One commenter asked if, since the May 2003 diagnosis of a 
BSE infected cow, CFIA has tested a statistically ``responsible'' 
number of brains of cattle less than 30 months of age in order to state 
with confidence that the region does not have younger animals that 
would test positive, as has happened in the United Kingdom and Japan.
    Response: APHIS published a risk assessment in November 2003 that 
discussed the risks and identified

[[Page 484]]

mitigation measures necessary for the import of certain live cattle and 
products from minimal-risk countries, and does not consider such 
testing on the part of Canada to be necessary before importation of 
these commodities. Experience in the United Kingdom and other parts of 
Europe in dealing with widespread BSE outbreaks, unlike the limited 
number of infections in Canada, has shown that testing cattle that are 
non-ambulatory, dead on the farm, or showing clinical signs consistent 
with BSE is the method most likely to disclose BSE if it is present in 
the cattle population. If BSE is not detected through testing of such 
``high-risk'' animals, there is little or no benefit to testing other 
cattle populations. It should be noted that CFIA, like APHIS, has 
conducted active surveillance since 1992 and implemented an expanded 
surveillance program on June 1, 2004. As of December 1, 2004, a total 
of more than 15,800 samples had been obtained in Canada, all with 
negative results for BSE.
Verification and Enforcement of Age Limits
    Issue: For ruminants entering the United States from a BSE minimal-
risk region for immediate slaughter, one commenter recommended that 
U.S. border officials and the receiving slaughtering establishment 
accept the age verification prepared by accredited Canadian 
veterinarians in order to expedite movement of the animals from the 
source feedlot to the slaughtering establishment. The commenter stated 
that such expeditious movement is important both from an animal welfare 
perspective and a product quality perspective. Conversely, another 
commenter indicated that USDA veterinarians should have the option of 
refusing entry to any cattle that appear to be 30 months of age or 
older.
    Response: As with the importation of all livestock into the United 
States, APHIS port veterinarians will be responsible for assuring that 
shipments of animals presented for import fulfill all necessary import 
requirements before their release from the border port. However we 
agree with the commenter who stated that verification of the animals' 
age can be made based on review of the certificate that is required by 
this rule to accompany the shipment of live bovines, sheep, and goats 
from BSE minimal-risk regions. Further, we agree that verification by 
means of the certificate will expedite movement of the animals to their 
destination.
    Therefore, instead of requiring, as we proposed in Sec.  
93.436(a)(4) and (c)(4) for bovines and sheep and goats, respectively, 
that means of conveyance that are used to move the animals to immediate 
slaughter be sealed with seals of the U.S. Government at the port of 
entry, we are requiring in Sec.  93.436(a)(4) for bovines and Sec.  
93.420(a) for other ruminants that the means of conveyance be sealed in 
the region of origin with seals of the national government of the 
region of origin. Such animals will undergo visual inspection by U.S. 
inspectors at the port of entry while they are in the means of 
conveyance. However, we are also providing in those sections that if 
U.S. inspectors at the port of entry consider it necessary to unseal 
the means of conveyance, the means of conveyance must be resealed with 
seals of the U.S. Government.
    Also, as discussed below under the heading ``Sealed Means of 
Conveyance,'' we are requiring that bovines, sheep, and goats imported 
from a BSE minimal-risk region for movement to a feedlot be moved in a 
means of conveyance that is sealed with seals of the national 
government of the region of origin. As with animals imported for 
immediate slaughter, such animals will undergo visual inspection by 
U.S. inspectors at the port of entry while they are in the means of 
conveyance and, as with animals imported for immediate slaughter, if 
U.S. inspectors at the port of entry consider it necessary to unseal 
the means of conveyance, the means of conveyance must be resealed with 
seals of the U.S. Government.
    Issue: Several commenters stated that determining the age of 
animals is not an exact science and that USDA should more clearly set 
out how it expects to enforce the 30-month age limit for slaughter.
    Response: Under this rule, cattle imported from a BSE minimal-risk 
region must be accompanied by certification by an authorized veterinary 
representative of the region of origin that the animals entering the 
United States are less than 30 months of age. In its January 2004 SRM 
rule, FSIS explained that the Agency's inspection program personnel 
will confirm the age of cattle, both of U.S. and foreign origin, that 
are slaughtered in official establishments, by means of documentation 
that identifies the age of the animal and, where necessary, by 
examination of the dentition of the animal to determine whether at 
least one of the second set of permanent incisors has erupted (the 
permanent incisors of cattle erupt from 24 to 30 months of age).
    Issue: A number of commenters asked what will be done with imported 
feeder cattle if they are determined to be over 30 months of age when 
received for slaughter.
    Response: If FSIS concludes the animals are 30 months of age or 
older, or if it cannot be determined that the animals are less than 30 
months of age, all SRMs will be removed, which would include brain and 
central nervous system tissue, along with the animal's tonsils and the 
distal ileum of the small intestine. FSIS will notify APHIS when such 
situations arise and APHIS will initiate enforcement action as 
appropriate. As we noted in APHIS'' March 2004 notice reopening the 
comment period on the proposed rule, APHIS is currently evaluating the 
appropriate approach regarding live cattle 30 months of age and older 
and intends to address that issue in a supplemental rulemaking in the 
Federal Register. (Please note: Although the wording we used in our 
notice did not specifically state the live animals we would evaluate 
for potential future rulemaking would be cattle and other animals other 
than those already included in the proposal, we consider our intent to 
have been clear in the context of the issues discussed in that notice.)
Importation of Cattle Other Than Those Going to Slaughter
    Issue: Our proposed rule provided that all ruminants would be 
prohibited importation from a BSE minimal-risk region, except for those 
imported in accordance with the provisions of the proposed rule. The 
only bovines for which conditions for importation were included in the 
proposed rule were those being moved either directly to slaughter or to 
a designated feedlot for further feeding before slaughter. In both 
cases, the proposed provisions limited importation to bovines that 
would be less than 30 months of age at slaughter. Similar provisions 
were proposed for sheep and goats that would be less than 12 months of 
age at slaughter. In effect, this provided for the continued 
prohibition on the importation of breeding cattle, sheep, and goats 
from Canada that APHIS imposed following the diagnosis of a BSE-
infected cow in that country in May 2003.
    Several commenters supported a continued prohibition on the 
importation of breeding cattle from Canada. One commenter stated that 
such animals should not be allowed into the United States from Canada 
until the year 2012, 15 years after the implementation of the feed ban 
in that country.
    Many commenters, however, stated that the regulations should allow 
the importation from a BSE minimal-risk

[[Page 485]]

region of cattle intended for other than immediate slaughter or 
slaughter after further feeding. One commenter recommended that APHIS 
open the border to breeding stock under 36 months of age. Another 
commenter recommended that cattle born after 2000 be allowed 
importation. A number of commenters stated that live cattle born after 
implementation of the feed ban in the BSE minimal-risk region should be 
allowed importation. Others said that cattle that were born before 
implementation of the feed ban, but other than in a high-risk area of 
the BSE minimal-risk region, should be allowed importation. Several 
commenters stated that no importation measures over and above the 
exporting country's being a BSE minimal-risk region would be necessary 
if the United States requires the removal of all SRMs upon slaughter in 
this country.
    A number of commenters recommended more specific conditions under 
which breeding cattle should be allowed importation from BSE minimal-
risk regions generally or from Canada specifically. One commenter 
requested that the importation be allowed for cattle that are 
temporarily brought to the United States for livestock expositions. 
Some of the other conditions recommended by commenters are the same 
ones we proposed to apply to the importation of ``feeder'' or ``fed'' 
cattle, such as that the animal was born after implementation of the 
feed ban and was not known to have been fed prohibited ruminant 
protein. In addition, several commenters recommended that the animal 
have permanent identification traceable back to the dam and herd of 
origin and not be progeny of a BSE suspect or confirmed animal. One 
commenter recommended that identification be in the form of an 
electronic eartag. Another commenter expressed confidence that breeding 
cattle imported from a BSE minimal-risk region could be adequately 
monitored using a permit process along with health certification before 
importation and by requiring recordkeeping by importers of animal 
transfers or disposal, including use in the food chain.
    Another commenter requested that the regulations allow the 
importation of registered cattle that were born in the United States 
and were taken to Canada at least 1 year following implementation of 
the ruminant feed ban in Canada, and also their offspring. The 
commenter provided suggested means of verifying the origin of the 
animal, including a tattoo of the breed registration number and 
accompaniment by the animal's registration certificate. Another 
commenter requested that U.S. origin cattle that are stranded in Canada 
be allowed to return to the United States if accompanied by a 
certification by the Government of Canada that, in accordance with 
Canada's feed ban, the animals have been not been fed ruminant protein 
while in that country.
    One commenter recommended that cattle over 30 months of age be 
allowed importation if the animals have tested negative for BSE. One 
commenter recommended allowing the importation of breeding stock that 
are found to be negative to a new BSE test.
    One commenter stated that pregnant heifers should be allowed 
importation if, after calving in the United States, the heifers are 
slaughtered before reaching 30 months of age. One commenter recommended 
allowing the importation of breeding cattle under 30 months of age or, 
alternatively, donor dams born in the United States and owned by U.S. 
producers. At the minimum, stated the commenter, such donor dams should 
be eligible to be returned to the herd of the owner, along with 
offspring resulting from embryo transfer.
    One commenter stated that, because BSE is not transmitted 
horizontally, the regulations should allow for the temporary 
importation of cattle into the United States for purposes such as 
livestock shows and rodeos, breeding, and semen collection, as long as 
the animal has permanent identification and tracking is carried out 
that the Administrator deems appropriate to ensure that the animal is 
returned to its country of origin.
    Response: We have carefully reviewed and considered the commenters' 
requests to allow the importation of cattle other than cattle less than 
30 months of age for immediate slaughter and cattle imported for 
feeding and then slaughter at less than 30 months of age. As we stated 
in our March 8, 2004, notice, we are currently evaluating the 
appropriate approach regarding other live cattle and intend to address 
that issue in a separate proposed rule in the Federal Register. We are 
taking the information provided by commenters into consideration in 
conducting the evaluation. However, at this time, we are making no 
changes in this final rule to allow the importation of cattle from BSE 
minimal-risk regions other than those for immediate slaughter, or for 
feeding then and slaughter, at less than 30 months of age.
    There is no BSE test for live animals at this time. The risk 
assessment made available by APHIS in conjunction with the November 
2003 proposed rule assessed the risk of resuming trade in designated 
ruminants and ruminant products from Canada. The analysis was conducted 
primarily in the context of feeder animals imported for slaughter. 
Special circumstances that might relate to breeding animals were not 
addressed. The analysis considered various risk factors associated with 
feeder animals for slaughter and mitigations of those risks. The age of 
the animal and the effect of a feed ban were two of the most 
significant factors. APHIS determined that cattle that are less than 30 
months of age are unlikely to have infectious levels of the BSE agent 
and that animals born after the feed ban was implemented are unlikely 
to have been exposed to the infectious agent. The combination of these 
factors caused us to conclude that we could safely import cattle for 
feeding and slaughter or for immediate slaughter that (1) were less 
than 30 months of age; (2) were subject to a ruminant feed ban; (3) 
were imported through designated ports of entry and, if moved directly 
to slaughter, were moved in a sealed means of conveyance; (4) were 
accompanied from the port of entry to a recognized slaughtering 
establishment by VS Form 17-33, or were accompanied by an APHIS Form VS 
17-130 for movement to the feedlot designated on the import documents 
and by APHIS Form VS 1-27 for movement from the feedlot; (5) were moved 
as a group to either a designated feed lot or recognized slaughtering 
establishment and (6) had their intestines removed at slaughter.
    The assessment did not consider the effects of these risk 
mitigation measures individually. Because we did evaluate the 
individual effects of these mitigation measures and the fact that we 
did not address the special circumstances related to breeding animals 
in our risk analysis, at this time we are not providing for the 
importation of such animals from BSE minimal-risk regions.
Request for Bans on Imports of Live Animals
    Issue: Several commenters expressed concern regarding the 
importation of any live cattle from Canada and requested that the 
importation of such animals continue to be prohibited. One commenter 
questioned how we can be certain that live animals from Canada are not 
affected by BSE, given there is currently no method available for 
testing live animals for the disease.
    Response: We acknowledge there are currently no approved live 
animal tests for BSE. However, our comprehensive analysis and 
evaluation leads firmly to the conclusion that the conditions specified 
in this rule for the importation of ruminants and ruminant products 
from BSE minimal-risk regions will be

[[Page 486]]

effective and will protect against the introduction of BSE into the 
United States. In our proposal, we set out a list of standards we would 
use to evaluate the BSE risk from a region and determine whether it is 
appropriate to classify that region as a region of minimal-risk for 
BSE. We stated that we would use these standards as a combined and 
integrated evaluation tool, basing a BSE minimal-risk classification on 
the overall effectiveness of control mechanisms in place (e.g., 
surveillance, import controls, and a ban on the feeding of ruminant 
protein to ruminants).
    In addition, we proposed individual risk mitigation measures for 
specific commodities, including live animals intended for importation 
from BSE minimal-risk regions, to further protect against the 
introduction and transmission of BSE in the United States. For live 
animals, such measures include: Maximum age requirements, movement 
restrictions and use within the United States, identification 
requirements, and removal of SRMs. As noted, our proposed rule 
specified removal of the intestines. However, FSIS has since issued 
regulations regarding SRM removal in all cattle slaughtered in the 
United States, including the removal of the tonsils and distal ileum in 
cattle of any age.
    Canada has implemented strong measures to guard against the 
introduction, establishment, and spread of BSE among cattle in that 
country, to detect infected animals through surveillance, and to 
protect the Canadian animal and human food supplies. Among other 
things, Canada has taken the following actions: Maintenance of 
stringent import restrictions since 1990; prohibition of the 
importation of live ruminants and most ruminant products from countries 
that have not been recognized as free of BSE; surveillance for BSE 
since 1992; implementation of a feed ban in 1997 that prohibits the 
feeding of most mammalian protein to ruminants; and extensive 
epidemiological investigations after the case of BSE in May 2003 and 
the Canadian origin case in Washington State in December 2003. Given 
these and other measures taken by Canada (e.g., requirements for 
removal of SRMs), and the conditions in this rule for the importation 
of ruminants and ruminant products from BSE minimal-risk regions, it is 
highly unlikely BSE would be introduced through the importation of live 
cattle for immediate slaughter or for feeding and slaughter under this 
rule.
    Issue: One commenter stated that, because every infected cow in 
North America has been a Holstein cow from Canada, APHIS should 
specifically prohibit the importation of dairy (in general, Holstein) 
cows. Another commenter stated that the differences between the risk 
profiles of dairy and beef cattle should be taken into account; that 
the feeding practices of dairies are more risky than those used by beef 
producers. The commenter requested that APHIS increase BSE testing for 
dairy cattle.
    Response: We are making no changes based on these comments. (It 
should be noted that, contrary to the commenter's statement, the cow 
that was diagnosed as BSE-infected in Alberta Canada in May 2003 was a 
beef cow and not a Holstein cow.) BSE is spread primarily through the 
use of ruminant feed containing protein and other products from 
ruminants infected with BSE. In cattle, oral ingestion of feed 
contaminated with the BSE is the only documented route of field 
transmission of the disease (Ref 24). Although there is no evidence to 
indicate that the breed of cattle is a risk factor for BSE, there is 
some evidence that the use of BSE-contaminated ruminant protein results 
in an increased risk of BSE in dairy cattle compared to beef cattle. 
However, this is most likely due to the differences in feeding 
practices between dairy and beef producers, because dairy cattle 
routinely receive high-protein feeds during milk production. In regions 
with an effective feed ban on ruminant protein, the differences in 
feeding practices should not significantly increase the level of risk, 
given that no ruminant protein is fed to either beef or dairy cattle.
    Issue: One commenter stated that APHIS should prohibit the 
importation for slaughter of any foreign animal born before the feed 
ban that is intended for human consumption or rendering. Another 
commenter stated the cattle born in Canada in a high-risk area before 
implementation of that country's feed ban should be prohibited 
importation.
    Response: From the context of the first comment, it appears the 
commenter is referring only to the importation of bovines. Practically 
speaking, the guidelines of both commenters will be met by the 
combination of the required feed ban and the provision limiting the 
importation of bovines to those less than 30 months of age.
Importation of Cattle for Subsequent Export of Meat
    Issue: One commenter stated that we should allow the importation of 
live cattle for slaughter through eastern U.S./Canadian border ports 
and allow the meat to be exported to Canada for use at fast food 
outlets.
    Response: We are making no changes based on the comment. We 
consider it necessary to apply the same risk mitigation measures 
regarding the importation of cattle from Canada for slaughter 
regardless of the intended destination of the meat derived from the 
animals. With regard to exportation of beef to Canada, this rule does 
not place any restrictions on the export to Canada of meat from cattle 
slaughtered in the United States. Those meat commodities that can be 
exported to Canada from the United States can be found at http://www.inspection.gc.ca.
Cattle Importations From Any Region
    Issue: One commenter stated that all beef cows imported into the 
United States from any country should be processed as a group.
    Response: Our proposal concerned the importation of live ruminants 
and ruminant products from regions that present a minimal risk of 
introducing BSE into the United States. Requirements regarding the 
importation of beef cows from elsewhere in the world are beyond the 
scope of this rulemaking.
Importation of Veal Calves
    Issue: Several commenters recommended that veal calves not be 
subject to the ban on the importation of live ruminants from Canada 
that the United States established in May 2003, because veal calves are 
a low-risk commodity due to their diet and their age at slaughter.
    Response: Veal calves are eligible for importation into the United 
States under this rule.
Basis for Restrictions on Sheep and Goats
    Issue: In Sec.  93.436(b) and (c) of our proposed rule, we proposed 
to allow the importation of sheep and goats from a BSE minimal-risk 
region for either immediate slaughter or for feeding and then 
slaughter, provided specified conditions were met. These conditions 
included, among others, the requirements that the sheep or goats be 
less then 12 months of age when slaughtered and not have been known to 
have been fed ruminant protein, other than milk protein, during their 
lifetime. Additionally, we proposed to require that sheep and goats 
imported for feeding and then slaughter be moved directly from the port 
of entry to a designated feedlot and then to slaughter.
    A number of commenters recommended that, because the OIE guidelines 
do not specifically address

[[Page 487]]

sheep or goats with regard to BSE, the importation of sheep and goats 
from BSE minimal-risk regions not be restricted.
    Response: We are making no changes based on this comment. Of the 
family of TSE diseases, one that has been known to occur naturally in 
sheep and goats is scrapie. With regard to sheep and goats and scrapie, 
the OIE guidelines recommend that all animal TSEs be considered when 
doing a risk assessment for the scrapie status of a country. There is 
currently less than complete understanding of the exact nature of TSEs 
and, in particular, their capability to cross species lines or adapt to 
new species; however, one theory is that BSE originated from scrapie 
(Ref 25). The OIE Terrestrial Animal Health Code (the OIE Code) 
discourages the importation of breeding animals from countries with 
scrapie or risk factors for TSEs in small ruminants, unless the animal 
originated from a scrapie-free flock. Because Canada is not free of 
TSEs, it is appropriate under the OIE Code to restrict the importation 
of breeding sheep and goats from Canada or any region that is not free 
of TSEs in sheep and goats or that has not conducted adequate 
surveillance to establish freedom. It is also appropriate to establish 
measures to prevent the diversion of imported feeder sheep or goats 
into breeding flocks in the United States. Since natural scrapie and 
the TSE in sheep caused experimentally by the BSE agent can't be 
differentiated by current routine diagnostic tests, APHIS intends to 
develop proposed rulemaking that would regulate for all TSEs in sheep 
and goats in this manner. In order to reestablish trade in low-risk 
sheep and goat commodities from BSE minimal-risk regions in a timely 
manner, we are addressing sheep and goats imported for immediate 
slaughter and for feeding and then slaughter in this rulemaking.
    Issue: A number of commenters recommended that breeding, feeder, 
and slaughter sheep and/or goats of any age, or feeder sheep and/or 
goats of any age be allowed unrestricted entry from a BSE minimum-risk 
region. Other commenters recommended that such animals be allowed entry 
if they were born after the implementation of a ruminant feed ban in 
the region, were not known to have been fed protein prohibited by the 
required feed ban, and are permanently identified in such a way that 
would allow tracing back to the dam and flock of origin. Several 
commenters recommended that breeding sheep and goats under 12 months of 
age be allowed importation. One commenter recommended that any sheep 
from a scrapie-monitored premises or sheep of any age that have been 
genotyped for scrapie resistance be allowed entry into the United 
States from a BSE minimal-risk region.
    Response: Sheep and goats over 12 months of age, such as breeding 
sheep and goats, were addressed in our risk assessment as animals with 
the potential to have infectious levels of the BSE agent. We consider 
it necessary to require risk mitigation measures to ensure that such 
animals do not introduce BSE into the United States. We are currently 
evaluating the type of mitigation measures needed to control risks 
associated with these animals and may conduct rulemaking in the future 
regarding the requirements necessary for the safe importation from BSE 
minimal-risk regions of such animals.
    Issue: One commenter questioned the advisability of allowing the 
importation from BSE minimal-risk regions of live sheep and goats 
younger than 12 months of age, stating that BSE infectivity has been 
shown to be more widely distributed in sheep tissue than in that of 
cattle.
    Response: Although the commenter is correct that results from 
experimental infections of sheep have shown that the BSE prion is more 
widely distributed in sheep tissues than in cattle, infectivity could 
not be demonstrated in most tissues until at least 16 months post-
exposure to the agent.
Sheep and Goats and Other TSEs
    Issue: Several commenters questioned how the proposed requirements 
for the importation of sheep and goats from BSE minimal-risk regions 
relate to other sections of APHIS animal import regulations, 
particularly those with regard to scrapie, a TSE for which there are 
import restrictions in part 93 and for which an eradication program 
exists in the United States. One commenter recommended that Canada be 
required to implement a country-wide scrapie eradication program 
identical to the U.S. system, along with an active surveillance system 
that meets or exceeds U.S. criteria and numbers. The commenter stated 
that such an eradication and surveillance system would reduce risk and 
eventually eradicate scrapie in the Canada, as well as any other 
variant TSE expressed in a manner clinically similar to scrapie, 
thereby reducing the risk of BSE entering the United States through the 
importation of sheep from Canada.
    Response: We agree with the commenter that a strong scrapie program 
in Canada will mitigate scrapie and possibly BSE risks for the United 
States. Historically, the United States has not significantly 
restricted the movement of sheep and goats into the United States from 
Canada with regard to TSEs because our ongoing bilateral trade 
relationship made it likely that our countries shared the same scrapie 
types and because both countries have maintained similar control and 
eradication programs for scrapie and prevention programs for BSE. Since 
the occurrence of BSE in two native Canadian cows, there is a now a 
very small risk that Canadian sheep and goats might have been exposed 
to BSE in feed and that BSE or a variant scrapie type may have been 
transmitted to sheep or goats, and an even more remote risk that BSE or 
a variant of BSE has become established through lateral transmission to 
other sheep and goats. We note that strong, although not mandatory, 
programs exist in Canada for surveillance and certification of sheep 
and goats with regard to scrapie. Although the proposed rule did not 
address the possible relationship of these programs in Canada to 
requirements for importing sheep and goats from minimal-risk regions 
for BSE, we consider it appropriate to restrict the importation of 
sheep and goats from BSE minimal-risk regions if certain conditions 
exist for those animals with regard to BSE or scrapie.
    Because of the differing nature of the BSE risk in sheep and goats 
as compared to that in bovines, we have reconsidered placing the import 
conditions for live sheep and goats from BSE minimal-risk regions in 
Sec.  93.436 as proposed (``Ruminants from regions of minimal risk for 
BSE''). The parallel construction of that section--two paragraphs 
addressing requirements for bovines, followed by two paragraphs 
addressing requirements for sheep and goats--may give the impression 
that sheep, goats, and bovines all present the same risk profile and 
require exactly parallel restrictions. In fact, the risks associated 
with importing sheep and goats include a very small risk that some 
sheep and goats may have naturally contracted, and might theoretically 
laterally spread, BSE or a variant of BSE, and a somewhat larger risk 
that sheep and goats affected by scrapie variants may spread these 
diseases. The primary risks presented by sheep and goats are related to 
scrapie and laterally transmissible variants that may or may not be 
related to BSE, not classic BSE.
    To correct this erroneous impression, we are moving the 
requirements for sheep and goats out of Sec.  93.436 and into other 
sections of the CFR that more generally address importation of sheep 
and goats (Sec. Sec.  93.419 and 93.420). While these changes will 
implement the

[[Page 488]]

requirements necessary for the current situation, because Canada is the 
only listed BSE minimal-risk region in Sec.  94.18(a)(3), we will need 
to reexamine these changes in the future if other countries are added 
to the list.
    One of the other changes we are making in this final rule is to 
amend Sec.  93.405, which has exempted sheep and goats from Canada that 
are not imported for immediate slaughter from restrictions that apply 
to sheep and goats from most regions of the world due to scrapie. Under 
this final rule, those restrictions will also apply to feeder sheep and 
goats from Canada.
    We are amending Sec. Sec.  93.419 and 93.420. Under the existing 
regulations, Sec.  93.419 has included provisions specifically for the 
importation of sheep and goats from Canada, other than those for 
immediate slaughter. In this final rule, we are including in Sec.  
93.419 most of the conditions for the importation of sheep and goats 
from Canada that we set forth in Sec.  93.436 of our proposal. However, 
those conditions that apply exclusively to sheep and goats from Canada 
for immediate slaughter, as opposed to feeding and then slaughter, we 
are including in Sec.  93.420, which currently includes conditions for 
the importation of ruminants from Canada for immediate slaughter.
    The existing provisions in Sec.  93.420 for the importation of 
ruminants from Canada for immediate slaughter require that the 
ruminants be consigned from the port of entry directly to a recognized 
slaughtering establishment and there be slaughtered within 2 weeks from 
the date of entry. Additionally, Sec.  93.420 provides that such 
ruminants will be inspected at the port of entry. In this final rule, 
we are retaining those provisions in Sec.  93.420 and are adding in 
that section the requirements we proposed for sheep and goats from BSE 
minimal-risk regions for immediate slaughter that the ruminants be 
moved as a group to the slaughtering establishment in sealed means of 
conveyance. However, as discussed above under the heading 
``Verification and Enforcement of Age Limit of Ruminants,'' we are 
requiring that the means of conveyance be sealed in the region of 
origin. As we proposed for sheep and goats for immediate slaughter, we 
are also specifying that the seals may be broken at the recognized 
slaughtering establishment only by a USDA representative. The shipment 
must be accompanied from the port of entry to the recognized 
slaughtering establishment by APHIS Form VS 17-33, which shall include 
the location of the recognized slaughtering establishment. By including 
these provisions in Sec.  93.420, they will be applied to sheep, goats, 
and other ruminants from Canada. This change to Sec.  93.420 represents 
a codification of conditions that APHIS has already been requiring by 
policy. (Please note: These same provisions with regard to bovines for 
immediate slaughter from BSE minimal-risk regions, including Canada, 
are included in Sec.  93.436 as proposed.)
    Additionally, we are providing in Sec.  93.420 that sheep and goats 
may not be imported from Canada for immediate slaughter if any one of 
the following conditions exists:
     The animals have tested positive for or are suspect for a 
TSE;
     The animals have resided in a flock or herd that has been 
diagnosed with BSE; or
     The animals' movement is restricted within Canada as a 
result of exposure to a TSE.
    These prohibitions preclude the entry of sheep and goats most 
likely to pose a risk for TSE transmission. For the reasons described 
above, we are also requiring in Sec.  94.19(c) and (d) of this final 
rule that meat, meat byproducts, meat food products, and carcasses of 
ovines and caprines from BSE minimal-risk regions not be derived from 
animals that were positive, suspect, or susceptible for TSEs. We are 
adding definitions of positive for a transmissible spongiform 
encephalopathy and suspect for a transmissible spongiform 
encephalopathy to Sec. Sec.  93.400 and 94.0.
Designated Feedlots for Sheep and Goats
    Issue: One commenter recommended that we include in the regulations 
specific criteria for designated feedlots for sheep and goats and 
methods and criteria according to which inventory control and 
traceability can be achieved once feeder lambs are imported.
    Response: Because of the uncertainty regarding BSE infectivity and 
transmissibility in sheep and goats, we concur that it is appropriate 
to establish criteria for designated feedlots for sheep and goats from 
BSE minimal-risk regions to ensure that such animals from are not 
commingled with U.S. sheep and goats not going to slaughter or U.S. 
sheep and goats older than those eligible for entry from a BSE minimal-
risk region. Scrapie, the best-studied TSE in sheep and goats, is 
laterally transmitted from sheep/goats to sheep/goats (most frequently 
either through exposure to an infected placenta or placental fluids or 
to environments contaminated with these tissues and fluids). Because 
experimental BSE in sheep has a tissue distribution that closely mimics 
that of scrapie in sheep, it is reasonable to conclude that BSE, if 
transmitted to sheep in feed, might be laterally transmitted. Until the 
risk of lateral transmission is better defined, we consider it prudent 
to ensure that sheep and goats of unknown TSE status are not commingled 
with U.S. sheep and goats not being moved to slaughter.
    Therefore, in Sec.  93.400, we are adding a definition of 
designated feedlot to mean a feedlot that has been designated by the 
Administrator as one that is eligible to receive sheep and goats 
imported from a BSE minimal-risk region and whose owner or legally 
responsible representative has signed an agreement to adhere to, and is 
in compliance with, the requirements for a designated feedlot. We are 
also adding specific requirements for a designated feedlot to Sec.  
93.419, ``Sheep and goats from Canada.'' Under these requirements:
     The owner of the designated feedlot or the owner's 
representative must monitor sheep and goats entering the feedlot to 
insure that all sheep and goats imported from a BSE minimal-risk region 
have the required ``C'' brand.
     Records must be kept at the feedlot of the acquisition and 
disposition of all sheep and goats imported from a BSE minimal-risk 
region that enter the feedlot. Such records must include the official 
eartag and all other identifying information; the date the animal was 
acquired by the feedlot and the animal's age at the time; the date the 
animal was shipped to slaughter and the animal's age at the time; and 
the plant where the animal was slaughtered. For sheep and goats 
imported from a BSE minimal-risk region that die in the feedlot, the 
eartag must be removed and be kept on file at the feedlot, along with a 
record of the disposition of the carcass.
     Copies must be maintained at the feedlot of the VS 17-130 
forms that indicate the official identification number of the animal 
and that accompany the animal to the feedlot and then to slaughter.
     Inventory and other records must be kept at the feedlot 
for at least 5 years.
     The feedlot must allow inspection by and provide inventory 
records to State and Federal animal health officials upon their 
request.
     Eartags on animals entering the feedlot must not be 
removed unless such removal is necessary for medical reasons. In such 
cases, and in cases where eartags are otherwise detached from the 
animal, an official scrapie program eartag assigned to the feedlot for 
this purpose or another form of official identification must be applied 
to the animals from which the eartags were

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removed and must be cross-referenced in the designated feedlot's 
records to enable matching with the original eartag.
     Either the entire feedlot or designated pens within the 
lot must be terminal for sheep and goats to be moved directly to 
slaughter at less than 12 months of age.
     If the inventory cannot be reconciled or if animals are 
not moved to slaughter as required, the feedlot's status as a 
designated feedlot will be withdrawn by the Administrator.
Distribution of BSE Agent in Goats
    Issue: In our proposed rule, we stated that, in the absence of data 
regarding distribution of the BSE agent in goats, it is assumed that 
such distribution would be similar to distribution of the agent in 
sheep tissues. One commenter stated that in the absence of scientific 
data such an assumption should not be made.
    Response: We disagree. Because distribution of the TSE scrapie is 
similar in sheep and goats, we consider it more logical to assume 
similarity of potential BSE distribution in sheep and goats than 
dissimilarity.
Ovine Embryos and Semen
    Issue: One commenter stated that because ovine embryos and semen 
have not demonstrated BSE infectivity, they should be allowed 
importation from a BSE minimal-risk region.
    Response: We are making no changes based on this comment. Under the 
existing regulations, semen from sheep and goats is currently not 
prohibited importation from regions listed in Sec.  94.18(a) as being 
affected with or at undue risk of BSE and will not be prohibited 
importation from BSE minimal-risk regions. However, we consider it 
necessary to prohibit the importation of ovine and caprine embryos from 
BSE minimal-risk regions. No studies have been conducted to date with 
regard to the BSE risk of ovine and caprine embryos. In the absence of 
an assessment of risk from such materials, we consider it prudent to 
continue to prohibit the importation of ovine and caprine embryos from 
regions listed in Sec.  94.18(a), which will include, under this rule, 
BSE minimal-risk regions.
Determining Age by Break Joint Technique
    Issue: One commenter recommended that instead of using less than 12 
months as the age of eligibility for sheep imported from a BSE minimal-
risk region, the maximum age for sheep should be determined by the 
``break joint'' technique that is used by FSIS to classify lamb.
    Response: We are making no changes based on this comment. The break 
joint in young lambs and goats is a cartilaginous area of the cannon 
bone that is not ossified. This joint ossifies with age to become what 
is called a spool joint. The break joint (or spool joint) method for 
establishing the maturity of a lamb or goat is not a FSIS regulation, 
but is instead contained in a guideline pamphlet published by the 
Agricultural Marketing Service (AMS) entitled ``Official United States 
Standards for Grades of Slaughter Lambs, Yearlings and Sheep'' (Ref 
26). This method was never presented as a truly reliable method for 
identifying animals of less than 12 months age, but instead was 
intended to provide general marketing methods and practices for 
agricultural commodities so that consumers could obtain the quality of 
product they desire.
    The break joint method is not sufficiently accurate to determine 
the age of sheep or goats for the risk mitigation purposes of this 
rule. Also, the break joint can not be readily determined in live 
animals and is therefore not useful in determining the age of slaughter 
sheep. Therefore, we are making no changes based on this comment.
Sealed Conveyances and Movement to Immediate Slaughter
    Issue: In Sec.  93.436 of our proposed rule, we included 
requirements that bovines, sheep and goats, and cervids imported from a 
BSE minimal-risk region for immediate slaughter be moved from the port 
of entry to a recognized slaughtering establishment in conveyances 
sealed at the port of entry with seals of the U.S. Government. We 
proposed, further, that the seals could be broken only at the 
recognized slaughtering establishment by a USDA representative. (As 
discussed above, we are requiring in this final rule that the means of 
conveyance be sealed in the region of origin.) One commenter asked what 
procedures will be followed with regard to the animals if broken seals 
or missing cattle are discovered at the slaughter plant and what 
procedures APHIS will follow if a truck cannot be adequately sealed at 
the port. The commenter also stated that USDA representatives should 
not include employees of the slaughtering establishment. Another 
commenter asked what the verification process would be concerning APHIS 
documents and sealed conveyances.
    Response: APHIS has provisions whereby the Agency enters into 
compliance agreements with the management of approved slaughtering 
establishments. These have proven to be exceptionally effective across 
a range of programs. We will work in accordance with these agreements 
and in close cooperation with FSIS to ensure that animals are accounted 
for and will take appropriate remedial measures as necessary.
    We do not expect, as a practical matter, to encounter situations 
where a means of conveyance cannot be adequately sealed at the port. As 
noted, we are requiring in this final rule that the means of conveyance 
be sealed in the region of origin before reaching the U.S. port of 
entry. If for some reason the APHIS inspector at the port needs to 
break the seal, resealing a means of conveyance that had previously 
been sealed is not expected to be a problem and there are several types 
of seals that can be used.
Immediate Slaughter
    Issue: In our proposal, we noted that, under the definition of 
immediate slaughter in Sec.  93.400, ruminants imported into the United 
States for immediate slaughter must be slaughtered within 2 weeks of 
the date of entry into the United States. Several commenters 
recommended that, in order to better control the movement of the cattle 
in the United States, the regulations not allow 2 weeks for slaughter,. 
Another commenter asked which government official will oversee and 
verify that all animals are sent to slaughter within the 2 weeks 
following entry into the United States. Other commenters wanted to know 
what steps will be taken if the cattle are not slaughtered within the 
required time period.
    Response: We continue to consider it appropriate to define 
immediate slaughter as slaughter within 2 weeks after entry into the 
United States. Animals imported for immediate slaughter must be moved 
directly from the port of arrival to the slaughter facility. However, 
cattle moved into the United States for slaughter are not always 
slaughtered as soon as they arrive at the slaughtering establishment. 
Because of the effects of stress and shrinkage during shipment, they 
are often held at the slaughtering establishment to improve body 
condition. Also, the date the animals are slaughtered is dependent on 
the workload at the slaughtering establishment. The 2-week period was 
established to allow time for arrival, processing, conditioning and 
slaughter of the animals in a reasonable amount of time. Because 
recognized

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slaughtering establishments must have full-time Federal or State 
veterinary inspectors on the premises, official government oversight of 
the arrival and penning of the animals is available. APHIS Form VS 17-
33 accompanies every shipment of animals imported for immediate 
slaughter and must be returned to the APHIS veterinarian at the port of 
entry after the animals are slaughtered. Any establishment that fails 
to comply with its agreement with APHIS will have its approval to 
receive further shipments of restricted animals for slaughter 
suspended.
Methods of Disposal
    Issue: Paragraphs (a)(6) and (b)(10) of Sec.  93.436 of our 
proposed rule included the requirement that the intestines of bovines 
imported from a BSE minimal-risk region be removed at slaughter in the 
United States. Paragraphs (a)(7) and (b)(11) of Sec.  93.436 of the 
proposed rule required that the intestines be disposed of in a manner 
approved by the Administrator. Several commenters asked for 
clarification regarding who we were referring to as the 
``Administrator.''
    Response: In APHIS'' regulations, including the definitions in 
Sec.  93.400 regarding the importation of ruminants into the United 
States, ``Administrator,'' unless otherwise identified, is defined as 
``The Administrator of the Animal and Plant Health Inspection Service 
or any other employee of the Animal and Plant Health Inspection 
Service, United States Department of Agriculture, to whom authority has 
been or may be delegated to act in the Administrator's stead.''
    However, in this final rule, we are not specifying that SRMs and 
other tissues removed at slaughter in the United States from bovines 
imported from a BSE minimal-risk region be disposed of in a manner 
approved by the Administrator. FSIS regulations governing disposal 
already exist in that Agency's regulations at 9 CFR 310.22, 314.1 and 
314.3, and we consider it appropriate that the FSIS provisions be 
followed with regard to disposal.
    Issue: A number of commenters stated that we should specify the 
potential means of disposal of removed intestines and verification of 
such disposal. Several commenters stated that materials requiring 
disposal under the regulations should be rendered by a licensed 
rendering company, with materials resulting from rendering being 
subject to FDA feed rules. In all cases, stated commenters, rendering 
should be the main option, and any other method must have to conform to 
the transportation, traceability, and pathogenic reduction requirements 
currently imposed on the rendering industry. Several commenters stated 
that disposal options should include only rendering, incineration, or 
alkaline digestion at an approved and licensed facility. Other 
commenters stated that burial, landfilling, composting, or burning 
should not be disposal options. Several commenters asked what FSIS will 
require of slaughtering establishments to ensure that the intestines 
are removed and disposed of properly.
    Response: In its SRM rule, FSIS established provisions regarding 
disposal of SRMs. In the explanatory information to that rule, FSIS 
stated: ``In this interim final rule, FSIS is requiring that 
establishments that slaughter cattle and establishments that process 
the carcasses or parts of cattle develop, implement, and maintain 
written procedures for the removal, segregation, and disposition of 
SRMs....'' FSIS provided further that the establishments must address 
their control procedures in their Hazard Analysis and Critical Control 
Point (HACCP) plans, sanitation standard operating procedures, or other 
prerequisite programs, and that FSIS will ensure the adequacy and 
effectiveness of the establishment's procedures. The FSIS SRM rule also 
requires that establishments that slaughter cattle and establishments 
that process the carcasses or parts of cattle maintain daily records 
that document the implementation and monitoring of their procedures for 
the removal, segregation, and disposition of SRMs. The rule provided in 
9 CFR 310.22(c) that SRMs must be disposed of in accordance with the 
FSIS requirements for disposal in 9 CFR 314.1 and 314.3. Those 
regulations provide that allowable means of disposing of the materials 
include tanking (inedible rendering), or-in those establishments that 
do not have facilities for tanking-incineration or denaturing.
    The comment period for the SRM rule closed on May 7, 2004. FSIS is 
assessing the comments it received on the rule, including those 
regarding the issue of disposal, and will determine whether to maintain 
or modify the requirements of the rule. In determining whether to 
approve a manner of disposal, FSIS will consult with FDA and the U.S. 
Environmental Protection Agency.
    Issue: Some commenters stated that, in addition to being prohibited 
from the food chain, SRMs should also be prohibited from being 
rendered.
    Response: FSIS considers SRMs to be unfit for human food. 
Therefore, such materials may be rendered only as inedible (not for 
human consumption). As discussed above, the allowable means of 
disposing of the materials include tanking (inedible rendering) or-in 
those establishments that do not have facilities for tanking-
incineration or denaturing.
    Issue: Several commenters asked whether proper disposal of 
intestines includes utilizing intestines in a meat-and-bone meal 
product that is used as a feed ingredient for nonruminant animals. The 
commenters stated that the distal ileum should be allowed to be 
processed into meat-and-bone meal for feeding to nonruminant animals 
because there is a high level of compliance with mandatory feed 
restrictions in United States.
    Response: We are making no changes based on these comments. FDA 
regulates the ingredients used in animal feed, including SRMs.
Testing at Slaughter
    Issue: A number of commenters recommended testing increased numbers 
of cattle for BSE at slaughter in the United States. Some commenters 
stated that determining which cattle are to be tested should depend on 
the animals' ages. Guidelines ranged from testing all cattle over 24 
months of age to all cattle over 30 months of age. One commenter 
recommended testing all cattle imported from a BSE minimal-risk region 
that were born before 2000. Some commenters recommended testing all 
cattle from Canada. Others recommended testing of all cattle sent to 
slaughter in the United States or all cattle that die in any location. 
One commenter recommended that the importer be required to have each 
imported animal that dies other than by slaughter tested at an 
accredited veterinary diagnostic laboratory.
    Response: APHIS, in cooperation with FSIS and FDA, has developed an 
intensive national BSE surveillance plan. The goal of this plan is to 
test as many cattle in the targeted high-risk population as possible in 
a 12-to 18-month period. Experience in the United Kingdom and other 
parts of Europe has shown that testing cattle that are non-ambulatory, 
dead on the farm, or showing clinical signs consistent with BSE is the 
method most likely to disclose BSE if it is present in the cattle 
population. This enhanced surveillance was begun on June 1, 2004. As of 
December 7, 2004, 136,153 cattle had been tested, all with negative 
results.
    Over a period of 12-18 months, APHIS will test as many cattle as 
possible in the targeted high-risk population. Data obtained in this 
effort will demonstrate whether BSE is actually present in the U.S. 
adult cattle

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population and, if so, help provide estimates of the level of the 
disease. This data will also help determine whether risk management 
policies need to be adjusted. The key to surveillance is to look at the 
population of animals where the disease is likely to occur. Thus, if 
BSE is present in the U.S. cattle population, there is a significantly 
better chance of finding the BSE within this targeted high-risk cattle 
population than within the general cattle population.
Non-Ambulatory Disabled (Downer) Animals
    Issue: Many commenters stated that no beef derived from non-
ambulatory (``downer'') animals should be allowed either to enter the 
United States or enter the U.S. food supply. Other commenters stated 
that meat from any downer animal should be held until the animal is 
tested for BSE, and should be allowed into the food supply only if the 
animal tests negative. Some commenters stated that downer animals 
should be allowed to go to custom slaughtering for the owner's personal 
use.
    Response: The issues raised by the commenters concern the safety 
for human consumption of beef slaughtered in the United States, which 
USDA addresses through its food safety agency, FSIS. As discussed above 
under the heading ``Measures Implemented by FSIS,'' that agency has 
determined that the carcasses of non-ambulatory disabled cattle are 
unfit for human food under section 1(m)(3) of the Federal Meat 
Inspection Act (FMIA), and that all non-ambulatory disabled cattle that 
are presented for slaughter will be condemned (i.e., not passed for 
human consumption). With regard to Canada specifically, that country is 
not allowing non-ambulatory animals to be slaughtered for export.
    Issue: One commenter expressed concern that Canada has not adopted 
the same BSE risk mitigation measures adopted by the United States, 
such as not prohibiting downer animals from entering the human food 
chain.
    Response: As noted above, Canada is not allowing non-ambulatory 
animals to be slaughtered for export. All of the FSIS requirements 
imposed on the U.S. domestic beef supply as a consequence of that 
agency's January 12, 2004, rulemakings also apply to foreign countries 
that are eligible to export beef to the United States. The foreign 
country's inspection program must be deemed by FSIS to be equivalent to 
the U.S. inspection program before the country can ship beef to the 
United States. This means that SRMs must have been properly removed in 
the exporting country consistent with the U.S. requirements, and that 
non-ambulatory disabled cattle be prohibited for human food purposes. 
FSIS has an on-going verification system to assess the effectiveness of 
the equivalency determination made for each foreign country deemed 
eligible to export meat to the United States, as discussed below under 
the heading ``Verification of Compliance in the Exporting Region.''
    Issue: Several commenters expressed concern that if non-ambulatory 
animals are excluded from slaughter in the United States, the current 
targeted surveillance systems will miss the chance to test these 
animals.
    Response: We disagree with the commenter that non-ambulatory 
animals will not be tested under the U.S. targeted surveillance system. 
Even before the FSIS determination that all non-ambulatory disabled 
cattle that are presented for slaughter will be condemned, these types 
of animals have often moved through channels other than for human 
consumption. A comparison of testing records before and after the FSIS 
determination indicates that this category of animals was being tested 
before that determination and continues to be tested.
Use of Blood in Ruminant Feed
    Issue: Several commenters stated that we should continue to 
prohibit the importation of live cattle from Canada because, according 
to the commenters, that country allows the feeding of blood and certain 
other ruminant products to cattle that are banned in the United States. 
Another commenter expressed concern that the proposal did not contain 
adequate verification that cattle imported from Canada are not fed 
animal blood.
    Response: The CFIA feed ban was implemented in 1997 to prevent BSE 
from entering the food chain. The CFIA's feed ban, equivalent to the 
FDA prohibition on the feeding of most mammalian protein to ruminants, 
prohibits materials that are comprised of protein, including meat-and-
bone meal, derived from mammals such as cattle, sheep and other 
ruminants, as well as salvaged pet food, plate waste and poultry 
litter. Products exempt from CFIA's feed ban include pure porcine and 
equine proteins, poultry and fish proteins, milk, blood, and gelatin, 
and non-protein animal products such as rendered animal fats (e.g., 
beef tallow, lard, poultry fat). These are products that are also 
exempt from the FDA prohibition. (Please note, however, that as 
discussed above in section III. C. under the heading ``Measures 
Implemented by FDA,'' in an advance notice of proposed rulemaking 
issued jointly by FDA, FSIS, and APHIS on July 14, 2004, FDA requested 
additional information to help it determine the best course of action 
regarding the feed ban.)
    In 2001, the EU Scientific Steering Committee (SSC), a scientific 
advisory committee for the EU, considered the amount and distribution 
of BSE infectivity in a typical case of BSE and estimated that, in an 
animal with clinical disease, the brain contains 64.1 percent of the 
total infectivity in the animal and the spinal cord contains 25.6 
percent. Thus, the brain and spinal cord of cattle with clinical BSE 
are estimated to contain nearly 90 percent of the total infectivity in 
the animal. According to the EU SSC, the remaining proportion of 
infectivity in a typical animal with clinical BSE is found in the 
distal ileum (3.3 percent), the dorsal root ganglia (2.6 percent), the 
spleen (0.3 percent), and the eyes (0.04 percent). Similar conclusions 
on the relative infectivity of specific tissues from an infected cow 
have been reached by Comer and Huntley in their evaluation of the 
available literature (Ref 27).
    We have noted that recent scientific studies have indicated that 
blood may carry some infectivity for BSE; however, those studies have 
concerned blood transfusions in animals. Additional research is 
necessary to determine which animals may become infected with BSE via 
blood, as well as the amount of infectivity contained in blood. We 
continue to consider it appropriate to recognize Canada as a minimal-
risk region because that country has taken a number of measures that 
would make it unlikely that BSE would be introduced from that country 
into the United States. The measures include a feed ban equivalent to 
that in effect in the United States.
    In addition to CFIA's feed ban on ruminant protein, Canada has 
taken additional measures to protect against the importation and 
possible spread of BSE. Such measures include: Import restrictions on 
live ruminants and ruminant products from countries that have not been 
recognized as free of BSE, surveillance and monitoring for BSE, and 
epidemiological investigation following the detection of BSE sufficient 
to confirm the adequacy of measures to prevent the further introduction 
and spread of the disease. Because of the mitigation measures taken by 
Canada to guard against the introduction and spread of BSE, we consider 
there to be minimal risk of infected blood entering the food chain from 
that region. However, to ensure the adequacy of feed restrictions for 
ruminants imported from Canada and other regions that may be

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recognized as minimal-risk regions for BSE in the future, we require in 
this rule that ruminants must have been subject to a ruminant feed ban 
that is equivalent to the requirements established by the U.S. Food and 
Drug Administration. That provision replaces the condition in our 
proposal that required that ruminants not be fed ruminant protein, 
other than milk protein, during their lifetime.
Animal Inventories
    Issue: One commenter recommended that the regulations require that 
cattle and other ruminants imported from a BSE minimal-risk region be 
accompanied by certification of the exact number of animals being 
shipped and the individual identification of the animals.
    Response: Section 93.407 of the existing regulations requires a 
declaration of, among other information, the number of ruminants 
presented for import. Additionally, on a working basis, we have 
interpreted the requirement in Sec.  93.405 that ruminants imported 
into the United States from Canada for other than immediate slaughter 
be accompanied by certification to include official identification of 
the ruminants. However, in order to make clear our intent, we are 
amending Sec.  93.405 by adding a new paragraph (a)(4) to specify that 
the information on the certificate required by that section must 
include the following: (1) The name and address of the importer; (2) 
the species, breed, number or quantity of ruminants or ruminant test 
specimens to be imported; (3) the purpose of the importation; (4) 
individual ruminant identification, which includes the eartag required 
by this final rule and any other identification present on the animal, 
including registration number, if any; (5) a description of the 
ruminant, including name, age, color, and markings, if any; (6) region 
of origin; (7) the address of or other means of identifying the 
premises of the herd of origin and any other premises where the 
ruminants resided immediately prior to export, including the State or 
its equivalent, the municipality or nearest city, or an equivalent 
method, approved by the Administrator, of identifying the location of 
the premises, and the specific physical location/destination of the 
feedlot where the ruminants are to be moved after importation; (8) the 
name and address of the exporter; (9) the port of embarkation in the 
foreign region; and (10) the mode of transportation, route of travel, 
and port of entry in the United States.
    We are also specifying in Sec.  93.436 that an official 
identification and any other identification on bovines imported for 
feeding and then slaughter from a BSE minimal-risk region must be 
listed on the APHIS Form VS 17-130 that must accompany the animals from 
the port of entry and on the APHIS Form VS 1-27 that must accompany the 
animals to slaughter. For sheep and goats, that requirement is in Sec.  
93.419. With regard to ruminants imported from a BSE minimal-risk 
region for immediate slaughter, the requirement that the animals be 
accompanied to slaughter by APHIS Form VS 17-33 for movement to 
slaughter will enable tracking of the animals following importation. 
Additionally, ruminants moved directly to slaughter must be moved in 
means of conveyance that was sealed in the region of origin and that is 
opened only by a USDA representative. We consider these requirements 
adequate to ensure immediate slaughter of such ruminants.
Transiting of Live Ruminants Through the United States
    Issue: One commenter stated that there would be little risk in 
allowing the transiting through the United States of products and live 
animals that have been recognized as low-risk by another country and in 
accordance with OIE standards. Several commenters expressed concern 
that the current prohibition on the importation of sheep and goats from 
Canada has unnecessarily eliminated the transiting of sheep and goats 
from Canada through the United States to Mexico and other Latin 
American countries. The commenters noted that the regulations as 
proposed would allow live sheep and goats imported from a BSE minimal-
risk region to be moved to designated feedlots in other than a sealed 
means of conveyance, and that, therefore, the regulations should also 
allow the transiting of lambs to Mexico.
    Response: We agree that the issue of the transiting of live sheep, 
goats, and bovines through the United States from a BSE minimal-risk 
region should be considered. As we noted in our March 2004 notice 
reopening the comment period on the proposed rule, we are currently 
evaluating, and intend to address in a supplemental rulemaking in the 
Federal Register, the importation of live animals under conditions 
other than those specified in our proposed rule.
    Issue: One commenter asked how APHIS will ensure that cattle are 
not exported from Canada to Mexico, then re-exported from Mexico into 
the United States.
    Response: As noted above, in this final rule we are codifying our 
interpretation that, under the requirements of Sec.  93.405, live 
cattle imported into the United States, including cattle from Mexico, 
must be accompanied by a certificate that includes, among other 
information, the region of origin of the animals.
Movement Forms
    Issue: One commenter stated that FSIS policies need to be 
established to ensure that agency's inspectors return the VS Form 17-33 
(which must accompany imported livestock to immediate slaughter) to the 
APHIS Port Veterinarian in a timely manner.
    Response: We agree that close collaboration and timely coordination 
between APHIS and FSIS is necessary, and both agencies are committed to 
establishing the most appropriate mechanism to achieve that result. 
APHIS is in the process of developing written instructions for FSIS 
personnel at approved slaughtering establishments and will submit those 
instructions to FSIS before this rule is implemented.
    Issue: One commenter recommended that the rule not be implemented 
until certain Veterinary Services forms and a memorandum are updated.
    Response: The documents referred to by the commenter are 
periodically reviewed and updated. As currently written, the forms 
provide sufficient information regarding the number and species of 
animal, as well as the seal numbers that are applied to the means of 
conveyances.
    Issue: Several commenters recommended that importers be required to 
account for all cattle, whether dead or sold.
    Response: The necessary accountability regarding the location, 
movement and disposition of animals will be provided by the requirement 
that movement permit APHIS Form VS 17-130, which identifies the 
physical destination of the animals and the person responsible for the 
movement of the animals, accompany all movements in the United States 
of feeder cattle imported from BSE minimal-risk regions.
Age and Feed Verifications
    Issue: Several commenters asked whether FSIS will verify the 
following information: (1) That animals are less than 30 months of age 
at slaughter; (2) that CFIA is using the same procedure for determining 
animal age as FSIS; and (3) that ruminants imported from BSE minimal-
risk regions for slaughter were not fed ruminant protein.

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    Response: Countries eligible to export meat to the United States 
must have a meat inspection system equivalent to the U.S. meat 
inspection system (as discussed below in section IV. D. under the 
heading ``Verification of Compliance in the Exporting Region''), 
including a system for verifying that SRMs are properly identified and 
removed from the human food supply. FSIS has an ongoing verification 
system to assess the effectiveness of the equivalency determination 
made for each foreign country deemed eligible to export meat to the 
United States. For live cattle, the FSIS-inspected slaughtering 
establishment is required by FSIS to implement procedures to determine 
the age of cattle in order to properly deal with SRMs. FSIS verifies 
that the establishment is meeting the regulatory requirements. Any 
cattle deemed to be 30 months of age and older must have those tissues 
that are considered SRMs in such animals, as well as the small 
intestine, removed and disposed of as inedible material.
    Regarding verification procedures for ensuring that an animal has 
not been fed ruminant protein during its lifetime, APHIS will not 
recognize a region as a BSE minimal-risk region unless APHIS has first 
determined that the region has in place and is effectively enforcing a 
ruminant-to-ruminant feed ban and that the region has a reliable 
veterinary infrastructure that can certify that the requirements of 
this rule with regard to individual shipments have been met. For FSIS, 
part of that agency's equivalency determination is based on the total 
system for ensuring that the BSE-infective agent is appropriately 
controlled. FSIS would rely upon certifications made by the government 
of the exporting country in order to assess compliance with these 
requirements.
Certification of Feed Ban Compliance
    Issue: Several commenters requested that the regulations require 
that the owner of ruminants imported from BSE minimal-risk regions be 
responsible for certifying that their animals have not been fed 
ruminant protein. One commenter further recommended that all imported 
cattle, regardless of their region of origin, be accompanied by an 
affidavit stating the animals have not been fed ruminant-derived 
protein.
    Response: One of the requirements in this rule regarding the 
importation of feeder and slaughter cattle from a BSE minimal-risk 
region is that they have been fed in compliance with the ruminant feed 
ban of the region of origin and, further, that the ruminant feed ban is 
equivalent to the requirements established by the FDA. That provision 
will replace the requirement in our proposal that such animals not have 
been fed ruminant protein, other than milk protein, during their 
lifetime. Certification for import must be provided by the government 
of the exporting country--in this case, CFIA. For the purposes of 
international trade, the country of export is required to issue the 
official health certification required by the importing country.
    We do not consider it necessary to require that all imported 
cattle, regardless of their region of origin, be accompanied by an 
affidavit stating the animals have not been fed ruminant-derived 
protein. Cattle are not permitted importation from those regions listed 
in Sec.  94.18(a)(1) as regions in which BSE exists, nor are they 
permitted importation from regions listed in Sec.  94.18(a)(2) as those 
that pose an undue risk of BSE. For regions that are included in 
neither of these categories, except for those regions listed in Sec.  
94.18(a)(3) as BSE minimal-risk regions, we do not consider it 
warranted based on risk to require certification that ruminants 
imported into the United States were subject to a feed ban.
    Issue: One commenter recommended that, because the United States 
already considered the scope and application of a feed ban in Canada 
before proposing to designate that country as a BSE minimal-risk 
region, the required certification for live ruminants and ruminant 
products from Canada not include a statement concerning compliance with 
the feed ban for individual commodities. The commenter requested that 
the certification be required to address only any additional measures 
taken to prevent against the introduction of BSE into the United 
States, such as verification of age for live animals and removal of 
SRMs for beef. Another commenter stated that a broad certification 
addressing the feed ban established in the region of origin would be 
more appropriate than certification based solely on the knowledge of 
the certifying officer.
    Response: We are making no changes based on these comments. We 
consider it necessary for possible traceback efforts that the 
verification statement regarding compliance with the feed ban 
requirements be included on the documentation that is provided when 
animals or commodities are presented for entry at U.S. border stations. 
Such certification for individual commodities will require that the 
certifying individual have knowledge of the origin of the commodities.
Border Stations
    Issue: Several commenters expressed concern that cattle are being 
imported into the United States illegally after dark on back roads. One 
commenter stated that border ports should be open 24 hours a day, 7 
days per week. Another commenter asked whether APHIS or FSIS will 
verify CFIA procedures to ensure that cattle were imported into the 
United States through an APHIS-designated port of entry.
    Response: U.S. Customs and Border Protection (CBP), Department of 
Homeland Security, monitors every port of entry with officers, 24 hours 
per day, 7 days per week, to ensure security at America's borders and 
ports of entry and, among other things, protect our agricultural and 
economic interests from harmful pests and diseases. Because CBP 
monitors every port of entry around the clock, we are confident that 
all shipments of live animals entered through those ports, including 
cattle imported from Canada, will be referred to APHIS and meet all 
applicable laws and regulations before importation into the United 
States. The issue of attempts at illegal smuggling is one that must be 
dealt with at any country's borders. APHIS' regulations in Sec.  93.408 
explicitly require that all live cattle imported into the United States 
be inspected by APHIS' Veterinary Services at designated ports of 
entry. Any individual who violates the regulations is subject to civil 
and criminal penalties in accordance with the AHPA.
    Issue: Several commenters expressed concern that our proposal did 
not designate a sufficient number of U.S./Canadian land border ports 
for the importation of live ruminants and ruminant products from Canada 
and requested that we establish additional land border ports in 
Minnesota, Montana, and North Dakota. Commenters specifically requested 
that we designate Dunseith, ND, as a port of entry. One commenter said 
that if our proposal were made final, a significant portion of renewed 
trade from Canada would be in the form of live animals. The commenter 
expressed concern that, because the proposal listed only three 
designated ports of entry convenient to the Canadian prairie Provinces, 
any delays at the ports of entry could become a serious animal welfare 
issue.
    Response: Section 93.403(b) of the regulations lists 20 designated 
ports of entry for the importation of live ruminants from Canada. Seven 
of those ports are in either Minnesota, Montana, or North Dakota. 
Dunseith, ND, is listed as a designated port of entry for live

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ruminants. The remainder of the designated ports are in Idaho, Maine, 
New York, Vermont, and Washington.
    With regard to meat and edible products derived from ruminants in 
Canada, we proposed that such commodities from Canada could be imported 
into the United States from Canada only through the border ports we 
listed in Sec.  94.19(k) of our proposal. Proposed Sec.  94.19(k) 
listed fewer ports of entry for meat and edible products from Canada 
than are listed in Sec.  93.403(b) for the importation of live animals. 
This is because the number of ports designated for meat and edible 
products is limited by the availability of facilities for FSIS 
personnel trained in the inspection of such commodities to conduct 
their required inspections.
    We do not have any evidence to suggest that the land border ports 
listed in Sec. Sec.  93.403(b) and 94.19(g) (redesignated from Sec.  
94.19(k) of the proposal) will be inadequate to provide inspection and 
import-related services for ruminant products and live ruminants 
entering the United States from Canada. Therefore, we are not making 
any changes in response to the comments. However, if, in the future, we 
add other countries to the list of BSE minimal-risk regions, or if the 
volume of imported commodities warrants it, we will adjust the list of 
designated ports accordingly.
Timing of Health Inspections
    Issue: One commenter recommended that the regulations require that 
animals intended for importation into the United States be inspected by 
an accredited veterinarian within 24 hours before shipment and be 
accompanied with a certificate of veterinary inspection.
    Response: We are making no changes based on this comment. The 
regulations in Sec.  93.408 explicitly require that all live cattle 
imported into the United States from Canada be inspected at the port of 
entry. Animals imported into the United States under this rule will be 
visually inspected by a U.S. inspector while on the means of conveyance 
at the port of entry. (Also, as noted above under the heading 
``Verification and Enforcement of Age Limit of Ruminants,'' U.S. 
inspectors at the port of entry will, if they consider it necessary, 
unseal the means of conveyance at the port of entry.) Section 93.418 
requires certificates of veterinary inspection for cattle other than 
for immediate slaughter. Requiring that such inspection be conducted 
within 24 hours of export would not be consistent with our current 
requirements for health certificates that require issuance of such 
certificates by the exporting region within 30 days of export, and 
would be unnecessary because the animals would be reinspected at the 
border 24 hours or less after inspection in the exporting region. From 
the standpoint of ensuring animal health and detecting disease, it is 
preferable to have two inspections up to 30 days apart.

D. Risk Mitigation Measures for Importation of Ruminant Products and 
Byproducts

Age of Animals From Which Meat Is Derived
    Issue: In Sec.  94.19 of our proposed rule, we provided that meat 
derived from bovines slaughtered in a BSE minimal-risk region could be 
imported into the United States under certain conditions. One of the 
conditions was that the meat be derived from bovines that were less 
than 30 months of age when slaughtered. One commenter stated that the 
OIE and Canada prohibit the importation of meat products and carcasses 
from bovines less than 30 months of age; therefore, the United States 
should do the same. Conversely, a number of commenters stated that, 
provided all SRMS were removed from the animals, it was unnecessary to 
require that the animals from which the meat was derived were less than 
30 months of age at slaughter. With the removal of the SRMs, said the 
commenters, the risk of BSE would be sufficiently mitigated.
    Response: We consider the commenters' recommendation to allow the 
importation of meat from bovines of any age under certain conditions to 
have merit. As we discussed in our March 8, 2004, extension of the 
comment period on our November 2003 proposed rule, and as we discuss 
above in section III. C. under the heading ``Measures Implemented by 
FSIS,'' the FSIS SRM rule designated the following tissues in cattle as 
SRMs and prohibited their use in human food: The brain, skull, eyes, 
trigeminal ganglia, spinal cord, vertebral column (excluding the 
vertebrae of the tail, the transverse processes of the thoracic and 
lumbar vertebrae, and the wings of the sacrum) and dorsal root ganglia 
of cattle 30 months of age and older, and the tonsils and distal ileum 
of the small intestine of all cattle. To ensure effective removal of 
the distal ileum, FSIS requires removal of the entire small intestine 
and prohibits its use in human food.
    These prohibitions do not restrict the slaughter of cattle in the 
United States based on age. The only role the age of the cattle plays 
in FSIS actions is in determining whether certain tissues (e.g., 
central nervous system tissues) in the animal should be considered SRMs 
due to the animal's age.
    Under FSIS regulations, meat inspection systems and processing 
requirements in Canada and in any country authorized to export meat and 
meat products to the United States must be equivalent to those in the 
United States in order for meat and meat products to be eligible for 
importation. Under these circumstances, we no longer consider it 
necessary to require that meat from bovines that is imported from a BSE 
minimal-risk region be derived only from animals less than 30 months of 
age, or that the animals were slaughtered in a facility that either 
slaughters only bovines less than 30 months of age or has in place a 
process adequate to segregate the meat from other meat slaughtered at 
the facility.
    With regard to meat from sheep, goats, and other ovines and 
caprines, neither the proposed rule nor this final rule identifies SRMs 
in ovines and caprines that could be removed to eliminate any potential 
infectivity from products derived from the animals. Therefore, this 
final rule will require, as proposed, that meat from sheep or goats or 
other ovines or caprines from a BSE minimal-risk region be derived from 
animals that were less than 12 months of age when slaughtered, and we 
are adding the same condition for the importation of meat byproducts 
and meat food products derived from ovines or caprines. We discuss the 
issue of meat byproducts and meat food products below.
    We disagree with the commenter who stated that international 
guidelines preclude the importation of meat products and carcasses from 
bovines less than 30 months of age from countries that OIE would 
consider to be minimal risk for BSE. The OIE guidelines recommend 
allowing the importation of meat from cattle of any age from such 
minimal-risk regions, provided the necessary risk mitigation measures 
are taken (e.g., the meat contains no part of the brain, eyes, spinal 
cord, skull or vertebral column, or protein products derived from such 
materials).
What Constitutes Meat
    Issue: In our proposed rule, we stated that, to be considered meat 
that is eligible for importation into the United States from a BSE 
minimal-risk region, a product would have to meet the FSIS definition 
of meat in 9 CFR 301.2. The FSIS regulations provided that, to be 
considered meat, product that undergoes mechanical separation and meat 
recovery from the bones of livestock must be processed in such a way 
that the processing does not crush,

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grind, or pulverize bones, so that bones emerge comparable to those 
resulting from hand-deboning and the meat itself meets the criteria of 
no more than 0.15 percent or 150 mg/100 gm of product for calcium (as a 
measure of bone solids content) within a tolerance of 0.03 or 30 mg. We 
noted in the preamble of our proposal that, except where the FSIS 
definition of meat was specifically referenced in our proposal, when we 
used ``meat'' we meant the standard dictionary definition of the term. 
One commenter stated that ``meat,'' as defined according to its common 
usage, could mean several different things. The commenter recommended 
that how we intend to use the term in the regulations should be 
specific to its purpose.
    Response: In order to avoid confusion, in this final rule we are 
using the term ``meat'' in all cases to mean meat as defined by FSIS. 
In its AMR rule, FSIS revised the definition of meat in 9 CFR 301.2 to 
mean, ``The part of the muscle of any cattle, sheep, swine, or goats 
that is skeletal or that is found in the tongue, diaphragm, heart, or 
esophagus, with or without the accompanying and overlying fat, and the 
portions of bone (in bone-in product such as T-bone or porterhouse 
steak), skin, sinew, nerve, and blood vessels that normally accompany 
the muscle tissue and that are not separated from it in the process of 
dressing. * * *'' FSIS provided further that meat does not include the 
muscle found in the lips, snout, or ears, and that meat may not include 
significant portions of bone, including hard bone and related 
components, such as bone marrow, or any amount of brain, trigeminal 
ganglia, spinal cord, or dorsal root ganglia.
    Additionally, in this final rule, we are clarifying that meat, meat 
byproducts, and meat food products from bison qualify as meat, meat 
food products, and meat byproducts under this rule, even though such 
commodities derived from bison are not included under the FSIS 
definitions.
Meat Byproducts and Meat Food Products
    Proposed Sec.  94.19 prohibited the importation of fresh (chilled 
or frozen) meat, meat products, and edible products other than meat 
(excluding gelatin, milk, and milk products) from ruminants that have 
been in a BSE minimal-risk region, unless conditions allowing for the 
importation of a specified commodity were included in that section or 
in Sec.  94.18. In Sec.  94.19, we proposed conditions for the 
importation of the following commodities: Fresh (chilled or frozen) 
bovine whole or half carcasses or other meat; fresh (chilled or frozen) 
bovine liver; fresh (chilled or frozen) bovine tongues; fresh (chilled 
or frozen) carcasses or other meat of ovines and caprines; fresh 
(chilled or frozen) meat or dressed carcasses of hunter-harvested wild 
sheep, goats, cervids, or other ruminants; fresh (chilled or frozen) 
meat of cervids either farm-raised or harvested on a game farm or 
similar facility; fresh (chilled or frozen) meat from specified wild-
harvested musk ox, caribou or other cervids; and gelatin.
    Issue: A number of commenters expressed concern that the proposed 
rule did not specifically include conditions for the importation of 
processed meat products. The commenters stated that products processed 
for edible use from boneless cuts of beef and other parts of the 
carcass from cattle of any age should be allowed importation, provided 
SRMs were removed from the cattle from which the products were derived. 
One commenter stated that, by incorporating FSIS's regulatory 
description of meat from 9 CFR 301.2, APHIS excluded from importation 
from a BSE minimal-risk region meat food products that are separately 
defined by FSIS as ``any article capable of use as human food which is 
made wholly or in part from any meat or other portion of the carcass of 
any cattle.'' The commenter stated that this prohibits the importation 
of a wide range of products for which there is no discernible risk 
factor.
    Response: We agree it is not necessary to prohibit the importation 
of processed meat products and byproducts from ruminants that meet the 
conditions in this rule for the importation of meat. Therefore, we are 
providing in Sec.  94.19 of this final rule that, along with meat as 
defined by FSIS, the importation conditions in this rule also apply to 
those products that are included in the FSIS definitions of meat food 
product and meat byproduct in 9 CFR 301.2.
    In those definitions, meat byproduct is defined as ``any part 
capable of use as human food, other than meat, which has been derived 
from one or more cattle, sheep, swine, or goats. * * *'' Meat food 
product is defined as ``any article capable of use as human food which 
is made wholly or in part from any meat or other portion of the carcass 
of any cattle, sheep, swine, or goats, except those exempted from 
definition as a meat food product by the [FSIS] Administrator in 
specific cases or by the regulations in * * * [9 CFR part 317], upon a 
determination that they contain meat or other portions of such 
carcasses only in a relatively small proportion or historically have 
not been considered by consumers as products of the meat food industry, 
and provided that they comply with any requirements that are imposed in 
such cases or regulations as conditions of such exemptions as to assure 
that the meat or other portions of such carcasses contained in such 
articles are not adulterated and that such articles are not represented 
as meat food products. * * *''
    Additionally, we are not specifying in this final rule that the 
meat and meat commodities imported into the United States under this 
rule must be chilled or frozen. Chilling or freezing meat and meat 
products does not affect the BSE risk from those commodities.
Cervid Products
    Issue: A number of commenters addressed the issue of the 
importation of products derived from cervids, including meat, antlers, 
trophies, and urine. One commenter objected in general to the 
importation of any hunter-harvested wild ruminant products. Most of the 
other commenters who addressed the issue of cervid products recommended 
that they be eligible for importation from a BSE minimal-risk region. 
Some commenters said such products should be eligible for importation 
without restriction. Others suggested specific conditions for importing 
such products. Several commenters recommended that we prohibit the 
importation of offal derived from cervids from BSE minimal-risk 
regions, because of the susceptibility of cervids to CWD.
    Response: As we discuss above under the heading ``Cervids,'' in 
this final rule we are not prohibiting or restricting the importation 
of cervids from BSE minimal-risk regions because of BSE. APHIS is aware 
of no epidemiological data indicating that cervids are naturally 
susceptible to the BSE agent. Published observations indicate that, 
during the height of the BSE outbreak in 1992 and 1993 in the United 
Kingdom, exotic ruminants of the Bovidae family in zoos were affected 
with BSE, while cervids, which are members of the Cervidae family, were 
not (Ref 22). Therefore, even in regions that have high levels of 
circulating infectivity and that should be considered high risk for 
BSE, BSE susceptibility in cervids was not observed. Therefore, in this 
final rule, we are not imposing any restrictions on cervid products 
from BSE minimal-risk regions because of BSE.
    Issue: Several comments recommended that products from wild 
cervids, especially from the United Kingdom, be allowed importation 
into the United States regardless of the exporting region's BSE status. 
The commenters stated that wild deer by

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their nature are not fed ruminant protein, that no TSE has ever been 
recorded in the deer population in the United Kingdom, and that 
surveillance of wild deer is ongoing in the United Kingdom, with no 
evidence of prion.
    Response: We are making no changes based on the comments, other 
than those we are making in this final rule with regard to cervid 
products from BSE minimal-risk regions. The provisions we proposed, and 
the risk analysis we conducted in conjunction with this rulemaking, 
concerned ruminant imports from BSE minimal-risk regions. We consider 
the issue of the importation of ruminant products from BSE-affected 
regions to be outside the scope of this rulemaking.
What SRMs Should Be Removed
    Issue: One commenter stated that we said in our proposal that a 
region we might classify as minimal risk for BSE could, strictly 
speaking, be classified as a moderate-risk country or zone under OIE 
guidelines. The commenter stated that OIE recommends, for moderate-risk 
countries or zones, that meat and meat products for export not contain 
brain, eyes, spinal cord, distal ileum or mechanically separated meat 
from skull and vertebral column from cattle over 6 months of age. The 
commenter expressed concern that, for cattle under 30 months of age 
from BSE minimal-risk regions, we proposed to require only the removal 
of the intestines at slaughter.
    Response: In our proposal, we did not make a general statement that 
BSE minimal-risk regions by our guidelines might be classified as BSE 
moderate-risk countries by OIE guidelines. Our discussion was 
particular to the situation in Canada. Our evaluations concluded that, 
according to our proposed standards, Canada qualified as a BSE minimal-
risk region. We indicated that, although a strict reading of the OIE 
standards relative to the duration of a feed ban would classify Canada 
as a moderate-risk country until 2005, our integrated approach to 
evaluating the BSE status of a country considers the length of a feed 
ban within the context of all control measures in place. Further, 7 
years represents the 95th percentile of the incubation period 
distribution; therefore, there is a rational basis for departing from 
the OIE guideline of 8 years. We considered the sum total of the 
control mechanisms in place at the time of diagnosis (e.g., 
effectiveness of surveillance, import controls, and feed ban) and the 
actions taken after it (e.g., epidemiological investigations, 
depopulation), thereby allowing the actions CFIA took in other elements 
to compensate for a shorter feed ban duration than recommended by OIE. 
Consistent with OIE guidelines, we consider the 30-month age standard 
for SRMs-except for tonsils and the distal ileum, as discussed below-to 
be adequate for regions such as Canada that we consider to be minimal-
risk for BSE. If countries (or other regions) other than Canada apply 
for a BSE minimal-risk designation under this rule, we will evaluate 
such requests on a case-by-case basis, and consider, as we did for 
Canada, the combination of factors affecting the risk of BSE being 
introduced into the United States from such countries or other regions.
    According to OIE guidelines, in a minimal-risk region, all of the 
tissues listed by the commenter except the distal ileum need be removed 
only from cattle over 30 months of age. The distal ileum need not be 
removed from cattle of any age. FSIS regulations define tonsils and the 
distal ileum as SRMs regardless of the age of cattle and require their 
removal. These definitions are applicable to meat from cattle 
slaughtered in the United States, as well as to meat imported from 
eligible foreign sources. To be consistent with the FSIS requirements, 
we are requiring in Sec.  94.19(a)(2) and (b)(2) that meat and other 
bovine products imported into the United States from a BSE minimal-risk 
region be derived from cattle that have had SRMs and the small 
intestine removed in accordance with the FSIS regulations.
    Issue: Several commenters recommended that not just intestines, but 
also brains, eyes and spinal tissue be prohibited from the food chain 
or rendering.
    Response: As discussed above in section III. C. under the heading 
``Measures Implemented by FSIS,'' that agency's SRM rule applies to 
meat from cattle slaughtered in the United States, as well as to meat 
from eligible foreign sources. As noted, we are requiring that meat and 
other bovine products from a BSE minimal-risk region be derived from 
animals that have had SRMs removed in accordance with the FSIS 
regulations.
Removal of SRMs
    Issue: One commenter stated that an exporting region would 
generally be unable to accurately certify that ``SRMs have been 
removed,'' and that APHIS should require instead certification that ``a 
majority of the known SRMs have been removed.'' For example, said the 
commenter, when a carcass-splitting band saw is used to split a carcass 
through the spinal cord, bone dust mixed with spinal cord tissue is 
left on the exposed cut surfaces of the vertebral column before removal 
of the spinal cord. Also, said the commenter, captive bolt pistols, 
when penetrating the skull during the stunning procedure, provide a 
source of hematogenous spread of central nervous system tissue to the 
carcass, although not as much as when air stunning devices are used. 
The commenter also stated that if BSE is anything like scrapie, perhaps 
steam is not an adequate means of sterilizing equipment after being 
used on BSE-contaminated tissues, given the heat-resistant nature of 
the scrapie agent. Another commenter raised similar issues, stating 
that the U.S. Government should discontinue contamination of beef with 
prions from the central nervous system and change allowable methods of 
slaughter and processing. The commenter recommended that captive bolt 
stunning be replaced by electrical stunning, that immobilization of the 
animal by a pithing rod be prohibited, and that no sawing through the 
spinal cord be permitted.
    Response: On January 12, 2004, FSIS published an interim final rule 
prohibiting the use of penetrative captive bolt devices that 
deliberately inject air into the cranial cavity of cattle, because that 
method of stunning has been found to force visible pieces of central 
nervous system tissue ( known as macro-emboli) into the circulatory 
system of stunned cattle. The comment period on that interim final rule 
closed on May 7, 2004, and FSIS is assessing the comments on this 
issue. At this time, FSIS considers the current stunning methods 
allowable for use in the United States to be practical and effective, 
based on a review of published studies on stunning methods.
    Regarding the cross-contamination issues identified by the 
commenter, FSIS has developed procedures to verify that cross-
contamination of edible tissue with SRMs is reduced to the maximum 
extent practical in facilities that slaughter cattle or process 
carcasses or parts of carcasses of cattle, both animals younger than 30 
months of age and 30 months of age and older. If an establishment uses 
dedicated equipment to cut through SRMs, or if it segregates cattle 30 
months of age and older from cattle younger than 30 months of age, then 
the establishment may use routine operational sanitation procedures 
(i.e., no special sanitation procedures are required). If the 
establishment does not segregate cattle 30 months of age and older from 
younger cattle, equipment used to cut through SRMs must be cleaned and 
sanitized before it is used on carcasses or parts from cattle less than 
30 months of age. FSIS believes

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that, due to the multiple risk mitigation measures implemented in the 
United States to prevent the spread of BSE, these procedures will 
reduce to the extent possible cross-contamination of carcasses with 
high-risk tissues. However, to assist in determining whether it should 
strengthen the measures required of establishments, on March 31, 2004, 
FSIS issued a press release during the comment period for its SRM rule 
that specifically requested public comment on methods to prevent cross-
contamination of carcasses with SRMs. The type of measures described 
above have also been implemented in Canada.
Advanced Meat Recovery Systems
    Issue: Several commenters stated that AMR systems (a technology 
that enables processors to remove the attached skeletal muscle tissue 
from livestock bones without incorporating significant amounts of bone 
and bone products into the final meat product) are notorious for 
containing tissue derived from the dorsal root ganglia (an SRM) in the 
final product, and recommended that the use of AMR be prohibited in the 
United States when slaughtering animals of Canadian origin. 
Additionally, the commenters recommended that products that contain AMR 
meat should not be allowed into the United States from BSE minimal-risk 
regions.
    Response: In its AMR rule, FSIS amended its description of meat to 
make it clear that, to be considered meat, AMR product may not include 
significant portions of bone or related components, such as bone 
marrow, or any amount of central nervous system-type tissues. 
Additionally, FSIS'' AMR rule provided that AMR systems may not use 
bones classified as SRM (vertebral column and skull of cattle 30 months 
of age and older). The AMR rule states that, if skulls or vertebral 
column bones from cattle 30 months of age and older are used in AMR 
systems, the product exiting the AMR system is adulterated, and the 
product and the spent bone materials are inedible and must not be used 
for human food. FSIS stated that the potential for human exposure to 
the BSE-infective agent is prevented in products prepared from cattle 
30 months of age and older using AMR systems because the AMR product 
cannot include source materials from the skull or vertebral column or 
contain any amount of brain, trigeminal ganglia, spinal cord or dorsal 
root ganglia. AMR systems can be used to prepare meat from the skull 
and vertebral column of cattle under 30 months of age. However, these 
source materials from cattle under 30 months of age are not designated 
as SRMs. The FSIS requirements are applicable to domestic beef as well 
as to beef from a foreign country deemed eligible for export to the 
United States.
Request for Clarification of Intent
    Issue: One commenter stated that the proposed rule seemed to allow 
the importation of some products containing bone or even SRMs. The 
commenter requested that APHIS clarify whether this was the intent, 
and, if so, provide the scientific justification for that decision.
    Response: It is not clear to us what provisions in the proposed 
rule the commenter is referring to. It is not APHIS' intent to allow 
the importation of any SRMs from BSE minimal-risk regions. SRMs must be 
removed from imported cattle at slaughter in the United States and must 
have been removed from cattle in the exporting country from which meat 
and meat products are derived. The skull and vertebral bones are 
included in the definition of SRMs (both according to the Canadian 
regulations and those of the United States because of the possibility 
that those bones might contain dorsal root ganglia) so ``bones of 
concern'' as far as BSE are concerned are not allowed importation. 
Other bones have not been shown to pose a risk of BSE infectivity.
Tonsils and Third Eyelid
    Under our proposed rule, intestines would have been the only 
tissues required to be removed at slaughter from cattle less than 30 
months of age from a BSE minimal-risk region. We also proposed that 
beef imported from a BSE minimal-risk region be derived only from 
bovines less than 30 months of age from which the intestines had been 
removed.
    Issue: One commenter stated that the EU SSC recommends also that 
tonsils of bovines of any age be regarded as a BSE risk. Several other 
commenters stated that, although our proposed rule required removal of 
only the intestines, Canada requires removal of all SRMs from animals 
at slaughter, and that U.S. citizens should be afforded the same level 
of protection as Canadian citizens. The commenters stated that because 
tonsils and third eyelid lymphoid tissue have been demonstrated to have 
possible BSE infectivity in animals as early as 10 months post-
inoculation, USDA should not only require removal of all SRMs from 
animals and products imported from minimal-risk regions, but also from 
all cattle slaughtered in the United States.
    Response: We are assuming that the commenters who referred to 
``animals'' in these comments were referring to bovines and bovine 
products from BSE minimal-risk regions. As discussed above in this 
document under the heading ``Age of Animals from Which Meat is 
Derived,'' requirements for removal of SRMs in Canada for meat and meat 
products eligible to be imported and U.S. requirements are currently 
equivalent. All of the requirements that were imposed by FSIS'' SRM 
rule on cattle slaughtered in the United States also apply to meat 
imported into the United States from foreign countries eligible to 
export the beef to the United States. FSIS'' SRM rule identified 
tonsils as SRMs. Tonsils of all cattle, regardless of age, must be 
removed. Based on FSIS's requirements, all regions intending to import 
meat and meat products into the United States will also have to remove 
the tonsils from cattle of all ages from which the meat and meat 
products are derived. As noted, we are providing in this rule that we 
consider SRMs to be those identified as such by FSIS.
    With regard to the third eyelid, there is no evidence that the 
third eyelid lymphoid tissue is a tissue at risk of infectivity for BSE 
in bovines. The only TSE agents that have been found in the third 
eyelid are scrapie in sheep and CWD in deer and elk. PrPres 
(the pathological form of the prion protein) has not been found in the 
third eyelid of cattle. There have been no reports of its presence in 
goats. Therefore, neither FSIS nor APHIS considers the third eyelid to 
be an SRM.
Distal Ileum
    Issue: A number of commenters took issue with the requirement in 
our proposal that the intestines be removed from cattle less than 30 
months of age from BSE minimal-risk regions, even though we stated in 
the explanatory information of our proposal that the distal ileum (a 
part of the small intestine) is the only part of the intestine that is 
likely to have infectious levels of the BSE agent. Several comments 
stated that we were incorrect in stating in our March 8, 2004, notice 
reopening the proposed rule comment period that FSIS classifies the 
small intestine of cattle of all ages as an SRM. The commenters stated 
that the FSIS rule classifies only the distal ileum as SRM, but 
requires removal of the entire small intestine as a means of ensuring 
the removal of the distal ileum. The commenters stated that APHIS 
should recommend removal only of the distal ileum. Other commenters 
stated that, at most, APHIS should require removal of the small 
intestine. One commenter recommended removal of the last 70

[[Page 498]]

inches of the small intestine, rather than the entire small intestine. 
Another commenter provided an anatomical description of the bovine 
small intestine that the commenter said could be used to develop a 
model of certification for the removal and disposal of the distal 
ileum.
    Response: The commenters are correct that FSIS classified the 
distal ileum from cattle of all ages as an SRM and not the entire small 
intestine. FSIS requires removal of the entire small intestine to 
ensure effective removal of the distal ileum. Canada has the same 
requirements. This final rule on BSE minimal-risk regions adopts FSIS'' 
requirements regarding removal of SRMs and the small intestine. In its 
SRM rule, however, FSIS acknowledged that methods might exist for 
processors to effectively remove the distal ileum without removing the 
entire small intestine and requested comments on that issue. The 
comment period for the FSIS interim final rule closed on May 7, 2004.
    Issue: One commenter stated that, although beef casings are 
currently allowed into the United States from countries not listed as 
BSE-affected or posing an undue risk of BSE, the FSIS rule requires the 
removal of the entire small intestine from all cattle of all regions 
regardless of BSE status. In addition, stated the commenter, the FSIS 
rule has prevented the importation of the entire intestines of cattle 
from regions where no BSE exists if the exporting country cannot 
certify removal of the small intestine. The commenter recommended that 
exporting countries that do not fall into any of the U.S. BSE risk 
categories should not be required to remove any SRM, much less certify 
the removal of the entire small intestine.
    Response: In addressing FSIS' application of its regulations to 
countries other than BSE minimal-risk regions, the commenter is raising 
an issue that goes beyond the scope of the APHIS rulemaking. In both 
its SRM rule and the USDA/FDA joint notice, FSIS specifically requested 
comment on the issue of removal of the distal ileum.
Tongue and Liver
    Issue: In Sec.  94.19(d) of our proposed rule, we provided that 
bovine tongues could be imported from BSE minimal-risk regions if the 
tongues were derived from bovines that were born after the region 
implemented an effective ban on the feeding of ruminant protein to 
ruminants, that are not known to have been fed ruminant protein other 
than milk protein during their lifetime, and from which the tonsils 
were removed at slaughter. Several commenters stated that the 
regulations should prohibit either the importation of all tongues from 
bovines from BSE minimal-risk regions, or the importation of tongues 
from bovines 30 months or older. Some of the commenters stated that the 
risk from tongues is unacceptable because the tongue is attached to the 
tonsils, which are likely to contain the BSE infectious agent in an 
infected animal.
    Response: We do not consider it necessary to prohibit the 
importation of bovine tongues from a BSE minimal-risk region, provided 
the conditions set forth in this rule are met. As we stated above under 
the heading ``What Constitutes Meat?,'' the tongue (but not the 
peripheral glandular material) is a muscle included in the FSIS 
definition of meat, and, to date, BSE infectivity has not been detected 
in muscle meat of cattle. In this final rule, we are not including a 
separate paragraph that includes the conditions for importing tongues 
from BSE minimal-risk regions. Tongues will be subject to the same 
requirements as other meat.
    We do acknowledge, however, as we did in our proposed rule, that it 
is necessary to ensure that the tongues come from bovines from which 
the tonsils have been removed. As we discuss above under the heading 
``Age of Animals from Which Meat is Derived'' and elsewhere, we 
believe, from an animal health perspective, to consider as SRMs those 
tissues listed by FSIS as SRMs. Under that listing, tonsils of all 
cattle, regardless of age, must be removed. Several procedures exist 
for removal of tongues so that they are effectively separated from the 
tonsils, including cutting of the tongue at its base and cutting the 
hyoid bones and associated structures to liberate the tongue from the 
tonsils.
    Issue: Several commenters stated that the proposed rule did not 
make clear why APHIS would require that bovine tongues or tallow from a 
BSE minimal-risk region be derived from animals that were born after 
the implementation of an effective feed ban, while the same requirement 
was not proposed for liver. Similarly, another commenter questioned why 
the age of an animal should be a factor regarding some products from a 
BSE minimal-risk region, such as meat, and not others, such as tongue 
and liver. Several commenters recommended that the regulations require 
that bovine liver from BSE minimal-risk regions be from cattle under 30 
months of age and that certification be required that this and any 
other requirements for liver have been met.
    Response: Under this rule, tongues, which, as we noted, are 
included in the FSIS definition of meat in 9 CFR 301.2, will be subject 
to the same requirements as other meat, including the requirement that 
the tongues be derived from bovines that were subject to a ruminant 
feed ban during their lifetime equivalent to the requirements 
established by FDA. Thus it is unnecessary for us to retain the 
separate conditions for tongues that appeared in Sec.  94.19 of the 
proposed rule, including the condition that the tongues be derived from 
bovines that were born after the region implemented an effective ban on 
the feeding of ruminant protein to ruminants. Also, as discussed in 
this document under the heading ``Age of Animals from which Meat is 
Derived,'' we are not including the requirement we proposed that meat 
from bovines from BSE minimal-risk regions be derived from animals that 
were less than 30 months of age when slaughtered. Liver, which falls 
under the FSIS definition in 9 CFR 301.2 of meat byproducts, will be 
subject to the same importation requirements in our rule as meat.
    With regard to certification, Sec.  94.19 as proposed and as set 
forth in this final rule already requires certification that the 
requirements for liver and other commodities regulated under that 
section have been met.
    Issue: One commenter asked how APHIS could conclude that the 
intestines of cattle are not safe, but the tongue and liver are.
    Response: Our proposed requirement that the intestines of cattle 
from BSE minimal-risk regions be removed was based on evidence that BSE 
infectivity could exist in the distal ileum of bovines as young as 6 
months of age. Similar infectivity has not been demonstrated in the 
tongue or liver of bovines of that age.
Milk and BSE Risk
    Issue: One commenter stated that milk was a dangerous prion carrier 
and that milk protein is an unacceptable risk.
    Response: At this time, there is no scientific evidence that milk 
and milk products are sources of BSE infectivity that would pose any 
BSE risk to public or animal health. Milk and milk products are 
regulated by the FDA and the safety of milk is discussed in ``BSE 
Questions and Answers'' that can be accessed on that agency's Web site 
at http://www.cfsan.fda.gov/comm/bsefaq.html.

[[Page 499]]

Verification of Compliance in the Exporting Region
    Issue: A number of commenters stated that USDA should conduct 
monitoring to ensure that imported products meet the FSIS definition of 
meat. One commenter recommended that APHIS specify the methods that 
will be used to conduct such verification. Several commenters asked 
whether APHIS or FSIS will verify the CFIA procedures necessary to 
ensure compliance with this rule. Other commenters questioned whether 
USDA can verify the practices of Canadian producers and the meat 
industry in that country. One commenter stated that verification should 
include the presence of USDA personnel in Canadian beef processing 
plants.
    Response: As required under the FMIA, FSIS ensures that imported 
meat in the U.S. marketplace is safe, wholesome, unadulterated, and 
properly labeled by (1) determining if foreign countries and their 
establishments have implemented food safety system and inspection 
requirements equivalent to those in the United States and (2) 
reinspecting imported meat and poultry products from those countries 
through random sampling of shipments. Countries eligible to export meat 
to the United States must have a meat inspection system determined by 
FSIS to be equivalent to the U.S. meat inspection system, including a 
system for verifying that SRMs are properly identified, segregated, and 
removed from meat that is exported to the United States. FSIS has a 
system to verify the ongoing equivalence of each foreign country deemed 
eligible to export beef to the United States. The FSIS equivalency 
determination is based on the country's inspection system for 
appropriately controlling the BSE-infective agent.
    FSIS conducts annual system equivalence audits, as required by the 
FMIA, to verify that the foreign country's inspection system remains 
equivalent to that required in the United States. This audit includes a 
sampling of export-certified foreign establishments. FSIS's audit 
system focuses on two essential components of safe food production that 
must be present in a foreign food regulatory system: (1) Industry 
process control, which is executed by establishments through sanitary 
procedures such as sanitation, HACCP and quality assurance systems, and 
microbial/chemical testing programs; and (2) government inspection, 
verification, and enforcement activities exercised in a form and at an 
intensity appropriate to ensure the effectiveness of industry process 
controls and detect noncompliance. Foreign food regulatory system 
audits are conducted in four phases: Planning, execution, evaluation, 
and feedback. Each of these phases is discussed below:
    1. Planning. FSIS prepares a consolidated annual plan to audit each 
country that exports meat, poultry, or egg products to the United 
States. Individual country audit plans are based, in large part, upon 
prior experience with the exporting country. For example, all previous 
FSIS audit reports are reviewed to identify issues for inclusion in the 
current audit. Port-of-entry reinspection data are also reviewed at 
this time to determine trends and identify areas of special interest 
for audit. These documents and data are used by FSIS to develop an 
audit plan that is customized for each country. The plan includes a 
list of foreign establishments selected for centralized records review. 
A subset of these establishments is further selected for on-site audit. 
FSIS uses a statistical method for establishment selection. Additional 
establishments may be added for cause.
    2. Execution. An auditor (or in some cases an audit team) is 
dispatched to the exporting country's inspection headquarters and/or to 
sub-offices as agreed in the audit protocol. Opening discussions are 
held with exporting country officials to determine if the national 
system of inspection, verification, and enforcement is being 
implemented as documented, and to identify significant trends or 
changes in operations. The FSIS auditor examines a sample of program 
records that provide evidence of the exporting country's regulatory 
activities and accompanies officials of the exporting country on field 
visits to a representative sample of establishments eligible to export 
to the United States. Exporting country officials conduct a review to 
verify that each selected establishment continues to achieve the U.S. 
level of sanitary protection. Particular attention is paid to how 
eligible establishments address food safety hazards, some of which may 
be different from those encountered in the United States. FSIS auditors 
observe establishment activities and correlate review findings made by 
exporting country officials. Selected microbiological and chemical 
laboratories are also reviewed, and a farm or feedlot is visited to 
verify animal drug controls. In a closing meeting, the FSIS auditor 
provides exporting country officials with an overview of conditions 
observed and ensures that audit observations are clearly understood.
    3. Evaluation. FSIS conducts a post-audit evaluation of all data 
collected on-site. When evaluating audit data, FSIS considers how 
sanitary measures of the foreign food regulatory system compare to 
those used in the United States and determines whether the foreign 
system cumulatively provides the same level of protection.
    4. Feedback. FSIS then sends the exporting country a draft audit 
report and provides the country an opportunity to respond to the 
audit's findings. After consideration of comments from the country, a 
final report is prepared. An action plan is mutually developed to 
address any issues raised by the audit. These issues are tracked by 
FSIS until resolution and are automatically included as items of 
special interest in the next audit.
    All reports of initial equivalence audits and equivalence 
verification audits are posted on the FSIS Web site (http://www.fsis.usda.gov/regulations/foreign_audit_reports_past/index.asp) when they are final, which is immediately after the final 
version is delivered to the audited country.
Meat From Beef vs. Dairy Cattle
    Issue: One commenter suggested distinguishing meat obtained from 
beef cattle from meat obtained from dairy cattle.
    Response: We are making no changes based on this comment. We are 
not aware of any benefits in addressing BSE mitigations or risk that 
would be derived from identifying meat as having come from beef or 
dairy cattle.
Request for Import Bans
    Issue: A number of commenters requested bans on certain commodities 
from Canada or other countries. Commenters stated that APHIS should not 
allow the importation of Canadian beef. Other commenters requested that 
APHIS not allow the importation of beef (some commenters specified 
ground beef) or animal feedstuffs from any country. None of these 
commenters provided data or other information to support their 
requests.
    Response: We are making no changes based on these comments. Under 
the Animal Health Protection Act, the Secretary of Agriculture (or 
official delegated in accordance with 7 CFR 2.22 and 2.80) may prohibit 
or restrict articles if the Secretary determines such prohibition or 
restriction is necessary to prevent the introduction or dissemination 
within the United States of any pest or disease of livestock. The 
Secretary has determined that the

[[Page 500]]

measures in place in Canada relative to BSE, together with the import 
risk mitigations required by this rule, would be effective in 
preventing the introduction of BSE into the United States via meat and 
meat products imported from Canada. Further, the United States, as part 
of the World Trade Organization, cannot set up arbitrary barriers to 
trade that would prohibit the importation of animal products if the 
risk of such products introducing livestock diseases or pests into the 
United States can be mitigated.
    Animal feed containing animal products may currently be imported 
into the United States under an import permit that sets out the 
conditions for such importation. Feed containing ruminant protein other 
than milk protein is prohibited importation into the United States from 
any region listed in Sec.  94.18(a), which lists regions in which BSE 
exists, those that pose an undue risk of BSE, and, under this final 
rule, those that are considered BSE minimal-risk regions.
Offal
    Issue: The regulations prior to this rule prohibited the 
importation of offal from any region listed in Sec.  94.18(a). Prior to 
this rule, the only regions listed in Sec.  94.18(a) were those in 
which BSE exists and those that present an undue risk of introducing 
BSE into the United States. As noted, however, in this final rule, we 
are including in Sec.  94.18(a)(3) a list of BSE minimal-risk regions.
    Paragraphs (a) and (a)(1) of the regulations in Sec.  95.4--which 
deal with restrictions due to BSE on the importation of processed 
animal protein, offal, tankage, fat, glands, certain tallow other than 
tallow derivatives, and serum--prohibit the importation of specified 
materials from regions listed in Sec.  94.18(a), unless the materials 
meet conditions set forth in Sec.  95.4.
    In Sec.  95.4(g) of our proposal, we set forth risk mitigation 
measures under which offal derived from cervids from BSE minimal-risk 
regions could be imported into the United States. However, we did not 
include provisions in our proposed rule for the importation of offal 
from ruminants other than cervids. The proposal was limited to cervid 
offal because cervid offal was among the most commonly imported low-
risk commodities from BSE minimal-risk regions. We proposed to define 
offal in Sec.  95.1 to mean the parts of a butchered animal that are 
removed in dressing, consisting largely of the viscera and trimmings, 
which may include, but are not limited to, brains, thymus, pancreas, 
liver, heart, and kidney.
    A number of commenters addressed the importation of offal other 
than cervid offal for edible and inedible purposes. One commenter 
recommended that the only requirement for the importation of offal from 
Canada should be certification from the Canadian Government that the 
fresh offal and other edible by-products are derived from bovines that 
were slaughtered and processed in a facility approved and inspected by 
the Government of Canada, and from which SRMs had been removed. Other 
commenters expressed concern that the proposed definition of offal in 
Sec.  95.1 would preclude the importation of hearts and kidneys from 
cattle from BSE minimal-risk regions and recommended that such organs 
be allowed importation provided they do not come in contact with SRMs. 
Several commenters noted that, although the proposed regulations and 
definition of offal in part 95 would prohibit the importation of liver 
from cattle from BSE minimal-risk regions, the provisions in proposed 
Sec.  94.19(c) provided for the importation of bovine liver from BSE 
minimal-risk regions if no air-injected stunning was used at slaughter. 
One commenter stated that it was not clear whether our proposed 
definition of offal applied to cervids. The commenter also recommended 
that the word ``trimmings'' be removed from the proposed definition of 
offal because its inclusion could be construed to prohibit the 
importation of meat trimmings. One commenter stated that the import 
prohibitions in part 95 should apply only to tissues that have been 
proven to potentially harbor the BSE infective agent.
    Response: We agree with the commenters that there is no scientific 
reason to limit the importation of offal from BSE minimal-risk regions 
to offal derived from cervids and that the criterion for whether 
products, including offal, derived from ruminants are allowed 
importation into the United States should be whether those products 
pose a risk of introducing BSE into the United States. Consequently, in 
this final rule, we are defining offal to mean ``the parts of an animal 
that are removed in dressing, including meat, meat byproducts, and 
organs,'' and, for clarity's sake, are specifying in Sec.  95.4(g) the 
conditions for the importation of offal from BSE minimal-risk regions. 
The conditions for importation of offal from ruminants from BSE 
minimal-risk regions are the same as those set forth in Sec.  94.19 of 
this final rule for the importation of meat, meat byproducts, and meat 
food products. We are providing in Sec.  95.4(g) that offal derived 
from ruminants from BSE minimal-risk regions is allowed importation 
into the United States if the offal is derived from cervids or if the 
offal is derived from bovines, ovines, or caprines and the following 
conditions are met:
    1. If the offal is derived from bovines, the offal:
     Contains no SRMs and is derived from bovines from which 
the SRMs were removed;
     Is derived from bovines for which an air-injected stunning 
process was not used at slaughter; and
     Is derived from bovines that were subject to a ruminant 
feed ban equivalent to the requirements established by FDA.
    2. If the offal is derived from ovines or caprines, the offal is 
derived from animals that:
     Have not tested positive for and are not suspect for a TSE 
(we are adding definitions of positive for a transmissible spongiform 
encephalopathy and suspect for a transmissible spongiform 
encephalopathy to Sec.  95.1 of the regulations);
     Were less than 12 months of age when slaughtered and that 
are from a flock or herd subject to a ruminant feed ban equivalent to 
the requirements established by FDA;
     Have resided in a flock or herd that has not been 
diagnosed with BSE; and
     Have not had their movement restricted in the BSE minimal-
risk region as a result of exposure to a TSE.
    As required for meat, meat byproducts, and meat food products in 
Sec.  94.19, we are requiring certification from the country of origin 
that the offal meets the above requirements and are requiring that the 
offal, if arriving at a U.S. land border port, arrives at a port listed 
in Sec.  94.19(g).
Tallow
    Issue: One commenter stated that it does not make sense to prohibit 
the importation of tallow from Canada but allow the importation of 
Canadian beef and veal.
    Response: The proposed rule did not prohibit the importation of 
tallow from BSE minimal-risk regions. We provided in proposed Sec.  
95.4(f) that tallow could be imported from a BSE minimal-risk region if 
the tallow is composed of less than 0.15 percent protein and meets 
certain other conditions specified in the proposal.
    Issue: One commenter said there is no scientific basis for 
requiring that tallow eligible for importation contain no more than 
0.15 percent impurities. The commenter stated that research

[[Page 501]]

conducted by Dr. D.M. Taylor, et al., of the Animal Health Institute, 
Edinburgh Scotland, failed to find an association between the 
occurrence of BSE and the consumption of tallow by cattle, and that in 
studies using BSE-spiked tallow, no infectivity was found in crude, 
unfiltered tallow extracted from rendered meat-and-bone meal. The 
commenter stated that the study was validated by injecting spiked BSE 
tallow intracerebrally into experimental mice without resulting 
demonstrated changes associated with TSEs. The commenter stated further 
that, in 1991, the World Health Organization (WHO) assembled 
consultants who determined tallow not to be a risk to animal or human 
health. Additionally, stated the commenter, the Harvard-Tuskegee Study 
refers to the safety of tallow.
    Response: The research referenced by the commenter documents the 
results of mouse assays. We are unaware of any studies that have been 
performed using cattle experimentally fed tallow infected with BSE with 
resulting absence of infectivity. Based on the scientific evidence 
currently available, it is not possible to dismiss the possibility that 
ingestion of tallow infected with BSE creates a risk of the 
transmission of BSE. This conclusion is consistent with the OIE Code, 
Article 2.3.13.1., which recommends that one of the conditions for the 
importation of tallow from any country, regardless of its BSE status, 
be that the tallow is protein-free (i.e., have a maximum level of 
insoluble impurities of 0.15 percent in weight).
    While WHO concluded that because of the proteinaceous nature of TSE 
agents, they will tend to remain with the cellular residues of meat-
and-bone meal during the extraction process rather than being extracted 
with the lipids of tallow, the EU SSC considers that possible TSE risks 
associated with tallow will result from protein impurities that may be 
present in the end product, because it is expected that TSE agents, if 
present in the product, would be associated with those impurities (Ref 
28).
    Issue: One commenter specifically supported the proposed provisions 
regarding edible tallow. Another commenter supported the proposed 
conditions except for the requirement that the intestines of the bovine 
had been removed at slaughter and the requirement that the bovine not 
have been fed ruminant protein other than milk protein. Instead, said 
the commenter, the requirement regarding feeding should refer instead 
to adherence to the CFIA and FDA feed bans. Another commenter stated 
that importation of all tallow should be prohibited. Several commenters 
stated that tallow should be accepted from BSE minimal-risk regions 
only if all SRMs were removed from the bovines from which the tallow 
was derived, segregation of the tallow from potentially risky materials 
is carried out in the region of origin, and the tallow is accompanied 
by certification by the owner of the animal from which the animal was 
derived that the animal was not fed ruminant protein. Other commenters 
recommended that there be no restrictions on the importation of tallow 
from BSE minimal-risk regions. One commenter stated that it was not 
scientifically defensible to require that tallow not be derived from an 
animal that died otherwise than by slaughter. Several commenters stated 
that, under the OIE Code, tallow is considered protein-free if it 
contains no more than 0.15 percent impurities, and that protein-free 
tallow should be allowed importation without further restriction. 
Several commenters said such tallow should be allowed importation no 
matter what the BSE status of the region of origin. The commenters 
stated further that, even if tallow intended for food, feed, 
fertilizers, cosmetics, pharmaceuticals including biologicals, or 
medical devices is not protein-free, it should be allowed importation 
if (1) it came from bovines that were subject to ante-mortem inspection 
with favorable results, and (2) had not been prepared using SRMs. One 
commenter also recommended that derivatives of non-protein-free tallow 
intended for the uses listed above be allowed importation without 
restriction.
    Response: In this rule, we are making some changes to the 
requirements we proposed regarding the importation of tallow from BSE 
minimal-risk regions. We agree that protein-free tallow will not pose a 
risk of introducing BSE into the United States. As noted above, this 
conclusion is consistent with the recommendation in the OIE Code that 
protein-free tallow (maximum level of insoluble impurities of 0.15 
percent in weight) be considered a commodity that may be imported 
without restriction, regardless of the BSE status of the exporting 
country. Therefore, we are removing the restrictions we proposed for 
the importation of protein-free tallow from BSE minimal-risk regions 
that could be used in animal feed, except for the requirements that the 
tallow be accompanied by certification that it is protein-free and, if 
arriving at a land border port, that it arrive at a port listed Sec.  
94.19(g). Additionally, with the commenter who recommended segregation 
of the tallow from any other risky products for BSE. We are also adding 
language to Sec.  95.4(f) to indicate that the listed importation 
requirements for tallow are for tallow imported into the United States 
from BSE minimal-risk regions as listed in Sec.  94.18(a)(3).
    Therefore, in this final rule, Sec.  95.4(f) authorizes the 
importation of tallow from BSE minimal-risk regions that could be used 
in animal feed, provided the tallow is accompanied by official 
documentation certifying that: (1) The tallow is protein-free tallow 
(maximum level of insoluble impurities of 0.15 percent in weight); and 
(2) after processing, the tallow was not exposed to or commingled with 
any other animal origin material. The requirements of our proposal 
pertaining to the port of arrival of the shipment and the requirement 
that each shipment be accompanied by an original certificate will 
remain. We intend to address the importation of tallow from regions 
other than BSE minimal-risk regions in future rulemaking.
    Under the existing regulations in Sec.  95.4, tallow derivatives 
are allowed importation from regions listed in Sec.  94.18(a) as 
regions affected with BSE or that pose an undue risk of BSE. Likewise, 
under this rule, tallow derivatives from BSE minimal-risk regions will 
be eligible for importation into the United States.
Tallow and Offal Testing and Inspection
    Issue: One commenter requested that our rule include the methods 
that will be used to test or inspect at the border any tallow or offal 
intended for importation into the United States from a BSE minimal-risk 
region to ensure that BSE-contaminated tallow or offal does not enter 
this country.
    Response: For tallow or offal subject to the FMIA to enter the 
United States, it must originate from a country where the inspection 
system has been determined by FSIS to be equivalent to the U.S. meat 
inspection system. As part of its equivalence determination, FSIS 
requires that certified establishments in foreign countries eligible to 
export meat product to the United States develop, implement, and 
maintain written procedures for the removal, segregation, and 
disposition of materials identified by FSIS as SRMs, to ensure that 
such materials are not used for human food. Thus, the use of SRMs in 
the production of edible tallow and offal imported into the United 
States is prohibited. When shipments reach the U.S. border, they are 
subject to reinspection by FSIS. Such reinspection can include review 
of documentation, product examination, and laboratory testing. If the 
product is not covered under the FMIA, FDA

[[Page 502]]

enforces its import restrictions applicable to those products.
    Issue: One commenter recommended that the importation of any organ 
meat into the United States from a BSE minimal-risk region be 
prohibited.
    Response: We are making no changes based on this comment. Some 
bovine tissues have demonstrated infectivity, whereas others have not. 
Tissues that have demonstrated infectivity are designated as SRMs and 
must be removed and disposed of as inedible. The small intestine of all 
cattle must also be removed and disposed of as inedible to ensure 
effective removal of the distal ileum. There is no BSE basis for 
prohibiting the importation of other tissue, including other tissue 
that is organ meat.
Sheep Casings
    Issue: As discussed above, in this rule we are adding the category 
of BSE minimal-risk regions to the existing categories in Sec.  
94.18(a) of regions where BSE exists or that present an undue risk of 
BSE. Several commenters stated that, although our proposed rule would 
allow the importation of live sheep from BSE minimal-risk regions under 
certain conditions, there was no mention of amending part 96, which, 
among other things, prohibits the importation of casings (bovine or 
other ruminant casings) from any region listed in Sec.  94.18(a). 
Because BSE minimal-risk regions will be listed in Sec.  94.18(a), said 
the commenters, this will preclude the importation of sheep casings 
from BSE minimal-risk regions. The commenters stated that APHIS should 
address this inconsistency by amending Sec.  96.2(b) to allow the 
importation of casings from BSE minimal-risk regions such as Canada.
    Response: The commenters are correct that we did not address the 
importation of sheep casings from BSE minimal-risk regions in the 
proposed rule. We agree that sheep casings imported from a BSE minimal-
risk region that are derived from sheep that were less than 12 months 
of age when slaughtered and that were from a flock subject to a 
ruminant feed ban equivalent to the requirements of FDA pose no more of 
a BSE risk than live sheep that meet the same conditions imported from 
such a region. Therefore, we are providing in Sec.  96.2(b) that sheep 
casings from a BSE minimal-risk region that are derived from animals 
less than 12 months of age when slaughtered and that were from a flock 
subject to a feed ban equivalent to FDA's may be imported into the 
United States from a BSE minimal-risk region, provided the casings are 
accompanied by an original certificate stating those conditions have 
been met. The certificate must be written in English. The certificate 
must be issued by an individual authorized to issue such a certificate 
under the provisions of current Sec.  96.3, which contains provisions 
for the issuance of certificates of animal casings from any foreign 
region. Upon arrival of the sheep casings in the United States, the 
certificate must be presented to an authorized inspector at the port of 
arrival. We are also adding a new paragraph (d) to Sec.  96.3 to 
provide that the required certification for sheep casing imported from 
BSE minimal-risk regions must be included on the certification required 
by that section.
Bile
    Issue: One commenter expressed concern that our proposed rule did 
not include provisions for the importation of bile from BSE minimal-
risk regions. The commenter stated that bile is synthesized in the 
liver and recycled from the intestines back to the liver before being 
stored in the gall bladder. In addition, said the commenter, bile has 
very low protein content, has never been found to contain any BSE 
agent, and has been classified by the EU in the same low-risk category 
as milk and liver. The commenter stated that if APHIS will allow the 
importation of bovine liver without regard to the age of the animal 
from which it was derived, then the importation of bile should also be 
allowed, because the process of collecting bile includes removing the 
gall bladder from the liver before emptying it.
    Response: The opinion of the European Union Scientific Steering 
Committee (Ref 29) includes bile in category IV--no detectible 
infectivity in a BSE-infected animal. However, because we did not 
address the importation of bile from a BSE minimal-risk region in our 
risk analysis for the proposed rule, we are not including bile in this 
final rule as a product eligible for importation from a BSE minimal-
risk region. However, we intend to address the importation of ruminant 
bile from such regions in separate rulemaking.
Blood Products
    Issue: One commenter recommended that APHIS allow the importation 
of blood products, including serum and products derived from serum, 
from a BSE minimal-risk region, provided the product is accompanied by 
certification by the exporting country that the blood was collected at 
the time of slaughter in a hygienic manner from either (1) a fetus or 
an animal that is less than 30 months of age; or (2) an animal older 
than 30 months of age that was either a live animal or stunned with a 
non-penetrating stunning device. The commenter noted that APHIS stated 
in its proposed rule that infectivity has not been detected in bovine 
tissues apart from the distal ileum until at least 32 months post-
exposure. As a result, said the commenter, the probability that blood 
collected from animals less than 30 months of age at slaughter might be 
contaminated with BSE is negligible. The commenter stated that, for 
animals older than 30 months, the potential that blood might be 
contaminated with BSE infectivity following stunning can be effectively 
mitigated by ensuring that blood is collected either from animals 
slaughtered with a non-penetrating stunning device or from live 
animals.
    Response: We did not address the importation of blood and blood 
products from BSE minimal-risk regions in the risk analysis we 
conducted for this rulemaking. Currently, conclusive science is lacking 
regarding the risk of BSE transmission by blood and blood products. 
Scientific studies researching TSE infectivity and blood have to date 
been limited to mouse bioassay. In those studies, infectivity in mice 
was not demonstrated (Ref 30). However, in studies with sheep, TSE 
infectivity in blood was demonstrated. To date, there are no known 
cattle studies researching TSE/BSE infectivity and blood.
Fetal Bovine Serum
    Issue: A number of commenters recommended that APHIS allow the 
importation of fetal bovine serum (FBS) from BSE minimal-risk regions. 
Commenters stated that FBS is collected from fetuses, which, if allowed 
to develop into calves, would meet the under-30-months-of-age criterion 
of our proposal. Further, it is collected under a controlled system 
that ensures that it is not exposed to SRMs. One commenter stated that 
there have been no documented cases of transmission of BSE from cow to 
fetus during pregnancy.
    Response: We are making no changes based on the comments. There is 
no conclusive data to indicate whether BSE is transmitted by blood or 
blood products such as FBS. The commenters did not identify the uses to 
which FBS would be applied. Were serum to contain infectious levels of 
the BSE agent, it might pose a risk for livestock if used in certain 
applications such as bovine vaccine production or bovine embryo 
transfer, or for other products brought into direct exposure with 
ruminants. Unless and until there is conclusive data to demonstrate 
that BSE is not transmitted by blood and would

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not be a contaminant of FBS, we consider it necessary to prohibit the 
importation of FBS from BSE minimal-risk regions. However, we realize 
that more information is necessary on this subject, and we are working 
with FDA to assess the risk from FBS and related materials and their 
various uses.
    Issue: One commenter recommended that, because of the need for FBS 
and the potential serious consequences of BSE in FBS, APHIS should 
pursue rulemaking to allow the importation of FBS under certain 
conditions from countries affected with foot-and-mouth-disease.
    Response: We have taken the commenter's guideline under 
consideration, but consider it outside the scope of this rulemaking, 
and are making no changes based on the comment in this final rule.
Gelatin and Collagen
    Issue: In Sec.  94.19(j) of our proposal, we proposed to allow the 
importation of gelatin from BSE minimal-risk regions, provided the 
gelatin was derived from the bones of bovines that were less than 30 
months of age when slaughtered and that were not known to have been fed 
ruminant protein other than milk protein during their lifetime. One 
commenter stated that those restrictions on the importation of gelatin 
were unnecessary and that the only requirement for the importation of 
gelatin from a BSE minimal-risk region should be that the bones used in 
the production of gelatin did not include the skull or vertebral 
columns from animals older than 30 months of age.
    Response: Consistent with the changes we discuss above under the 
heading ``Age of Animals from which Meat is Derived'' regarding the 
effectiveness of the removal of SRMs in mitigating BSE risk, we are 
removing the proposed requirement that the gelatin be derived from the 
bones of bovines less than 30 months of age when slaughtered and are 
requiring instead that the gelatin be derived from the bones of bovines 
from which the SRMs were removed. Also, consistent with the changes we 
discuss above under the heading ``Certification of Feed Ban 
Compliance,'' we are revising our provisions regarding gelatin from BSE 
minimal-risk regions to require that the bovines from which the gelatin 
was derived were subject to a ruminant feed ban equivalent to that 
established by FDA.
    We are also adding language to the regulations to clarify how the 
provisions regarding gelatin in Sec.  94.19(f) of this final rule 
differ from the existing provisions regarding gelatin in Sec.  94.18. 
The existing provisions in Sec.  94.18 have allowed the importation of 
gelatin under import permit from regions in which BSE exists or that 
pose an undue risk of BSE. APHIS issues such a permit only after 
determining that the gelatin will be imported only for use in human 
food, human pharmaceutical products, photography, or some other use 
that will not result in the gelatin coming in contact with ruminants in 
the United States. We are making no changes to those provisions. The 
provisions in Sec.  94.19(f) of this final rule regarding gelatin from 
BSE minimal-risk regions allow for the importation of certain gelatin 
over and above that eligible for importation under Sec.  94.18(c)--
i.e., if the gelatin from a BSE minimal-risk region meets the 
conditions of Sec.  94.19(f), it will not be limited to uses that will 
not result in the gelatin coming in contact with ruminants in the 
United States. To clarify this, we are identifying the gelatin 
addressed in this final rule in Sec.  94.19(f) as gelatin not allowed 
importation under Sec.  94.18(c). Additionally, we are making a 
nonsubstantive wording change to Sec.  94.18(b) to clarify that the 
only gelatin derived from ruminants from regions listed in Sec.  
94.18(a)(1) or (a)(2) as regions in which BSE exists or that pose an 
undue risk of BSE that is eligible for importation is gelatin that 
meets the requirements of Sec.  94.18(c).
    Issue: One commenter recommended that collagen also be addressed in 
the regulations and be allowed importation from a BSE minimal-risk 
region under the same conditions as gelatin.
    Response: Collagen derived from hides is not considered a risk 
(hides are exempt from most restrictions). However, collagen can be 
derived from bones. In addition, collagen is not subjected to the same 
extreme conditions of processing as is gelatin. We believe there is a 
need for more research regarding the risk from bone-derived products 
that have the potential for direct exposure to ruminants and are making 
no changes based on the comment.
    Issue: One commenter requested that this final rule confirm there 
will be no restrictions on the importation of gelatin and collagen from 
hides or skins.
    Response: According to the OIE guidelines, hide-derived products 
should be allowed unrestricted entry because they do not pose a BSE 
risk. At this time, we allow the importation of hide-derived gelatin 
and collagen under permit.
    Issue: One commenter stated that all gelatin derived from the bones 
of bovines should be prohibited importation into the United States 
because there have been instances of people contracting vCJD from 
gardening with bone meal.
    Response: We are making no changes based on this comment. We assume 
the commenter linked gelatin and bone meal because both products are 
derived from bones.
    In this rule, we are allowing the importation of gelatin from a BSE 
minimal-risk region only if the gelatin is derived from bovines from 
which SRMs have been removed in the exporting region, and, further, 
that the bovines from which the gelatin was derived were subject to a 
ruminant feed ban equivalent to the requirements established by the 
U.S. Food and Drug Administration.
    To date, there is no known link between bone-derived gelatin and 
vCJD and we are unaware of any evidence that shows that handling bone 
meal can cause vCJD. Additionally, on January 9, 2004, the Centers for 
Disease Control issued a Morbidity and Mortality Weekly Report (Ref 31) 
that confirms that since 1996, surveillance efforts have not detected 
any cases of indigenous vCJD in the United States.
Importation of Animal Feed From Canada
    Issue: Several commenters stated that the importation of feed that 
contains animal byproducts from Canada should be prohibited. Another 
commenter addressed the requirements in part 95 of the regulations 
regarding certification for the importation of products used in animal 
feed into the United States. The commenter stated that, because 
obtaining original certifications for each load of feed can be time-
consuming and expensive for feed mills not located close to government 
veterinary certification services, the Canadian regulations allow faxed 
copies of veterinary certificates to accompany loads of feed, with the 
understanding that the feed mill will keep a copy of the original on 
file once it arrives at the mill. The commenter requested that APHIS 
honor this form of certification for feed containing animal protein, 
or, at a minimum, for feeds containing only vitamins and minerals as 
the only animal source of ingredients in the feed.
    Response: We are making no changes based on these comments. We did 
not propose any changes to the provisions in 9 CFR part 95 regarding 
the importation of meat meal and bone meal for animal feed and consider 
the comments to be outside the scope of the proposal.
    Issue: One commenter recommended a prohibition on the importation 
of feed and feed byproducts from either of the

[[Page 504]]

two Canadian feed mills that have been associated with BSE-infection in 
that country, unless such feed is submitted to routine FDA inspection.
    Response: We do not consider it practical or necessary to place 
restrictions on individual feed mills that may have handled high-risk 
material more than 5 years ago. We consider current USDA and FDA import 
restrictions on processed animal proteins from BSE countries, including 
minimal-risk countries, adequate to provide the necessary protection to 
public and animal health.
Plate Waste and Poultry Litter
    Issue: One commenter stated that plate waste and poultry litter 
have the potential of exposing ruminants to BSE infection and should be 
among the materials prohibited in feed for ruminants.
    Response: This final rule requires that the ruminant feed ban in 
BSE minimal-risk regions be equivalent to that of FDA in the United 
States. As discussed above in section III. C. under the heading 
``Measures Implemented by FDA,'' in an advance notice of proposed 
rulemaking issued jointly by FDA, FSIS, and APHIS on July 14, 2004, FDA 
requested information to help it determine the best course of action 
with regard to the ruminant feed ban.
Cooperative Service Agreements
    Issue: Although Sec.  95.4 restricts the importation of animal 
protein, tankage, fat, glands, tallow other than tallow derivatives, 
and serum from regions where BSE is known to exist or that present an 
undue risk of BSE, Sec.  95.4(c) exempts certain materials from the 
restrictions under certain conditions. One of the conditions for such 
an exemption is that the facility where the materials are processed and 
stored have entered into a cooperative service agreement with APHIS to 
pay for the costs of an APHIS veterinarian to make annual inspections 
of the facility. In our proposed rule, we proposed that, for facilities 
in a BSE minimal-risk region, in lieu of annual APHIS inspections of 
the facility, such inspections could be carried out by the government 
agency responsible for animal health in the region, although APHIS 
would reserve the right to inspect as necessary. One commenter stated 
that cooperative service agreements should be required for all 
countries in order to maintain uniformity.
    Response: We are making no changes based on the comment. In order 
for APHIS to consider a region eligible for BSE minimal-risk status, 
APHIS would have evaluated the region's veterinary infrastructure as 
well as the risk of BSE in the region. This rule requires that 
equivalent inspections be performed by the veterinary authorities of 
such minimal-risk regions, thereby relieving the need for cooperative 
service agreement cost recovery mechanisms for APHIS to conduct the 
site inspections. As noted, however, APHIS reserves the right to 
conduct site inspections as needed.
    Issue: Several commenters addressed the fact that the FDA ban on 
feeding ruminant products to ruminants in this country has included an 
exemption allowing mammalian blood and blood products to be used in 
ruminant feed. One commenter, referring to the APHIS proposed 
requirement that ruminants imported into the United States not have 
been feed ruminant protein other than milk protein, asked how APHIS 
will handle cattle that were fed blood meal before FDA announced in 
January 2004 that it will eliminate the blood and blood product 
exemption. Another commenter stated that the proposed rule contained 
inadequate verification that a similar tightening of restrictions will 
be taken by Canada.
    Response: At this time, both the United States and Canada allow the 
use of bovine blood and blood products in ruminant feed. Therefore, the 
feeding requirements for ruminants in Canada are currently equivalent 
to those here in the United States. We are requiring in this final rule 
that bovines imported from a BSE minimal-risk region have been fed in 
accordance with the feed requirements that were in effect in the United 
States at that time. Therefore, herd owners in minimal-risk regions 
will have to meet any new U.S. feed requirements in order for their 
animals to be eligible for export to the United States. As discussed 
above in section III. C. under the heading ``Measures Implemented by 
FDA,'' FDA has requested additional information to help it determine 
the best course of action regarding the feed ban.
Importation Based on Origin of Meat
    Issue: One commenter recommended that APHIS should allow the 
importation of (1) meat that originated in the United States and was 
processed in a BSE minimal-risk region, and (2) meat that originated in 
a region not listed in Sec.  94.18 (a)(1) or (2) as a BSE-affected or 
undue-risk region.
    Response: Even before this final rule, the regulations in Sec.  
94.18 allowed for the situations described by the commenter by allowing 
the importation into the United States of meat, meat byproducts, and 
meat food products derived from ruminants that had never been in a 
region listed in Sec.  94.18(a). That provision would allow the 
importation of U.S. origin meat that was processed in a BSE minimal-
risk region. However, the commodities must meet all other applicable 
importation conditions in part 94 of the regulations.

E. Risk Basis for the Classification of Canada

    Of the 3,379 comments that APHIS received on the proposed rule, 
approximately 15 questioned the risk basis for the proposed 
classification of Canada as a minimal-risk region for BSE. These 
comments focused largely on the nature of our risk analysis; APHIS' use 
of the Harvard-Tuskegee Study; whether the risk analysis provided 
sufficient data and adequately considered uncertainties; the prevalence 
of BSE in Canada; and whether existing regulations should be 
maintained. The issues raised by these commenters are discussed below 
by topic.
Nature of the Risk Analysis
    Issue: One commenter stated that USDA has not presented an 
appropriate risk analysis that supports the proposed action to allow 
the importation of ruminants and ruminant products from Canada. The 
commenter said that the risk analysis presents opinions, judgments, and 
conjectures rather than relevant data and the results of transparent 
and sound quantitative analysis.
    Response: We disagree with the comments. We believe that our risk 
analysis provides a solid basis for action by the Secretary under the 
Animal Health Protection Act (7 U.S.C. 8301-8317), USDA's statutory 
authority for animal health regulations, and that it meets Federal 
guidelines and requirements related to rulemaking, including the 
Administrative Procedure Act (5 U.S.C. 551 et seq.) and Executive Order 
12866, Regulatory Planning and Review.
    Experts in the field of risk analysis generally agree that 
different methods of risk assessment are appropriate in different 
circumstances. OIE Guidelines for Import Risk Analysis involving trade 
in animals and animal products (Ref 19), for example, recognize both 
qualitative and quantitative risk assessment methods as valid. 
Likewise, Codex Alimentarius (Ref 32), the international standard-
setting organization for food safety, encourages the use of 
quantitative information in risk analysis to the extent possible, but 
provides that food safety risk analysis may be either qualitative or 
quantitative.
    APHIS' risk analysis, which relied on both qualitative and 
quantitative

[[Page 505]]

information, including the Harvard-Tuskegee Study's quantitative 
analysis of the risk of BSE spreading if introduced into the United 
States (Ref 3), provided the information necessary to make informed, 
scientifically sound, well-reasoned decisions for our action with 
respect to Canada.
    Issue: The same commenter maintained that APHIS' risk analysis 
fails to answer questions about the impacts of the proposed rule on 
human health, including: What is the probable change to human health 
risk (i.e., frequency and severity) that would be caused by each 
alternative risk management option considered (e.g., reopening the 
border to less restricted imports, importing under different types of 
restrictions, keeping the status quo), and how certain is the change in 
health risk caused by each proposed action? Specifically, the commenter 
stated that the risk analysis does not provide ``any quantitative or 
substantive qualitative estimation of the frequency and severity of 
adverse health effects from the different decision alternatives, beyond 
undefined adjectives such as `low,' offered without any clear explicit 
interpretation or any explicit verifiable derivation from data.''
    The commenter stated that these questions, and analogous questions 
for animal health, are usually considered essential components of a 
health risk assessment. For example, said the commenter, a Joint United 
Nations Food and Agricultural Organization/World Health Organization 
Expert Consultation ``defines risk characterization (corresponding 
approximately to what USDA terms `risk estimation') as the `integration 
of hazard identification, hazard characterization [i.e., dose-response 
or exposure-response relation] and exposure assessment into an 
estimation of the adverse effects likely to occur in a given 
population, including attendant uncertainties.' '' The commenter also 
pointed to a similar definition used by the Codex Alimentarius 
Commission: ``The qualitative and/or quantitative estimation, including 
attendant uncertainties, of the probability of occurrence and severity 
of known or potential adverse health effects in a given population 
based on hazard identification, hazard characterization, and exposure 
assessment.'' The commenter asserted that ``qualitative reassurances do 
not constitute an adequate risk analysis.''
    The commenter also stated that the Harvard-Tuskegee Study found 
``available information inadequate'' to assess the risk of U.S. 
consumers developing vCJD from cows or meat. The commenter said that 
when maintaining the status quo will have no adverse impact on public 
health, and a proposed change could have a negative impact on public 
health, sound public policy dictates that the change not be made until 
all information needed to adequately assess the public health risk is 
available.
    Response: The commenter suggested that the risk analysis for the 
rulemaking answer very specific questions about the precise impacts of 
the rule on human health. As the Harvard-Tuskegee Study noted, the 
information necessary to quantitatively assess the risk of humans 
contracting vCJD as a result of consuming BSE-contaminated food 
products is not available (Ref 33). Thus, the Harvard-Tuskegee Study 
quantified potential human exposure, but did not estimate how many 
people might contract vCJD from such exposure. That does not mean, 
however, that there is insufficient information about the potential 
impacts of the rule on human health. The Harvard-Tuskegee Study 
concluded that only a small amount of potentially infective tissues 
would likely reach the human food supply and be available for human 
consumption. As explained above, that amount was based on conditions as 
they existed in 2001, before safeguards implemented recently by FSIS 
and FDA, including prohibitions on the use of air injection stunning 
devices at slaughter and prohibitions on the use of nonambulatory 
cattle and SRMs in human food. These newly implemented safeguards, as 
well as additional information that indicates that compliance with feed 
restrictions in the United States is better than had been estimated, 
makes it far less likely that even small amounts of infective tissue 
would reach the human food supply and be available for human 
consumption. Further, we know that, despite estimates that more than 1 
million cattle may have been infected with BSE during the course of the 
epidemic in the United Kingdom, which could have introduced a 
significant amount of infectivity into the human food supply, only 150 
probable and confirmed cases of vCJD have been identified worldwide. 
This data suggests a substantial species barrier that may protect 
humans from widespread illness due to ingesting BSE-contaminated meat. 
This barrier suggests that it is unlikely that there would be any 
measurable effects on human health from small amounts of infectivity 
entering the food chain. We believe that this information allows an 
appropriate assessment of the effects of this rulemaking on human 
health.
    Regarding the commenter's assertion that our risk analysis lacked 
essential components and provides only qualitative assurances, we 
disagree. As explained earlier, APHIS analyzed the risk of BSE being 
introduced into the United States through the importation of live 
ruminants and ruminant products and byproducts from Canada under the 
proposed rule. In doing so, we drew on a number of sources of 
information, including the Harvard-Tuskegee Study, which, as noted, 
specifically and quantitatively assessed the consequences of an 
introduction of BSE.
    APHIS' risk analysis began with identifying the hazard as ``the BSE 
risk that might be posed by importation of designated commodities and 
animals into the United States from Canada.'' Carefully scrutinizing 
both qualitative and quantitative information, we characterized the 
hazards to animal health, public health, the environment, and trade and 
evaluated the likelihood that U.S. livestock would be exposed to 
infectious levels of BSE from any of the commodities that would be 
allowed into the United States under the proposed rule.
    Based on the hazard identification, hazard characterization 
(referred to in our risk analysis using the OIE terminology, ``release 
assessment''), and exposure assessment, APHIS' risk analysis then 
estimated the adverse effects likely to occur--that is, we 
characterized the risk. The hazard identification, release assessment, 
and exposure assessment clearly indicated that it is unlikely that 
infectious levels of BSE would be introduced into the United States 
from Canada with any of the commodities included in the assessment, and 
that, even if the BSE agent were introduced into the United States, it 
would be extremely unlikely to enter commercial animal feed and thereby 
infect U.S. cattle or to result in human exposure to the BSE agent.
    This conclusion was based on multiple factors, each of which 
reduces risk. These factors include the low number of infected animals 
or products that might conceivably be imported into the United States 
from Canada even without the mitigations applied by this rule, given 
the import and feed restrictions in place in Canada; the low reported 
incidence rate in that country coupled with Canada's active 
surveillance program--both of which satisfy and exceed the OIE 
guideline for a minimal BSE risk country or zone; the further reduction 
in risk associated with imports as a result of the mitigation measures 
imposed by this rule; the very

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low likelihood of tissue from an infected animal entering the U.S. 
animal feed chain or the human food chain as a result of past and 
recent safeguards imposed by USDA and FDA on slaughter practices, the 
prohibitions of nonambulatory cattle and SRMs in human food, and animal 
feed restrictions, both in Canada and the United States; and the very 
low likelihood that any such tissue would contain infectious levels of 
the BSE agent, and be present in sufficient quantities in feed consumed 
by susceptible animals to cause infection.
    Issue: The same commenter stated that the Secretary's own advisory 
committee cautioned against making BSE-related regulatory decisions 
until a more thorough scientific risk analysis is completed. The 
commenter cited the Report of the Secretary's Advisory Committee on 
Foreign Animal Diseases, Measures Related to Bovine Spongiform 
Encephalopathy in the United States, February 13, 2004.
    Response: The February 13 report to the Secretary cited by the 
commenter (Ref 34) discusses a report prepared by an international 
review team (IRT) that, at the Secretary's request, reviewed the U.S. 
response to the case of BSE in Washington State and recommended 
measures that could be taken to provide additional public or animal 
health benefits. The IRT, which was established as a subcommittee of 
the Secretary's Advisory Committee, delivered its report to the 
Secretary's Advisory Committee on February 4, 2004. The IRT report was 
titled ``Measures Relating to BSE in the United States'' (Ref 35). The 
February 13 report said that the IRT's conclusions about the level of 
BSE likely to be circulating in the United States and North American 
cattle populations were different from those of the Harvard-Tuskegee 
Study. The February 13 report stated, ``The Committee must have this 
issue of risk resolved prior to completing its recommendations to the 
Secretary. It is imperative that the Secretary has the best available 
science and more precise risk assessments in order to make appropriate 
regulatory decisions.'' The regulatory decisions referred to in the 
report involve decisions by the Secretary about whether and how to 
respond to recommendations of the IRT, particularly those related to 
exclusion of SRMs and non-ambulatory cattle from human and animal food 
supplies in the United States. The IRT also made recommendations 
related to surveillance of U.S. cattle for BSE, laboratory diagnosis of 
samples taken for surveillance purposes, animal identification, and 
other domestic measures, such as educational programs, that could 
provide additional public or animal health benefits. None of the IRT's 
recommendations pertained to import restrictions. Accordingly, the 
specific statement cited by the commenter is not relevant to this 
rulemaking. We have responded to and are in the process of evaluating 
the balance of the committee's recommendations. We, of course, agree 
that sound regulatory decisions must be based on a scientifically sound 
risk assessment and the best available science, and we believe we have 
adhered to that standard in this rule.
APHIS' Use of the Harvard-Tuskegee Study
    Issue: The same commenter maintained that the Harvard-Tuskegee 
Study was prepared for purposes other than to serve as support for a 
decision to allow the importation of live ruminants and ruminant 
products from Canada. Moreover, said the commenter, it was prepared 
before the BSE cases in 2003 and, even though the authors have updated 
their analysis, none of the simulation runs or analyses were 
specifically appropriate for the action that USDA propose, and none 
claimed to model the current situation in Canada. The commenter said 
that USDA does not explain how the Harvard-Tuskegee Study, which did 
not use Canadian data, can even be used as an analytic tool to support 
reclassifying Canada's risk status. At best, said the commenter, the 
Harvard-Tuskegee Study should be viewed as a first-cut ``screening'' 
risk analysis, whose conclusions suggest the need for additional 
refined risk analyses.
    Response: We agree that the Harvard-Tuskegee model is not 
appropriate for modeling the situation in Canada. We did not employ the 
model to that end. Rather, we used the model to evaluate the likelihood 
that BSE would spread if introduced into the United States from Canada. 
As explained previously, the Harvard-Tuskegee Study analyzed the risk 
that BSE would spread if introduced into the United States. The 
Harvard-Tuskegee model doesn't specify the external source of the 
infectivity, only its size and timing. Therefore, it is relevant to 
evaluating the consequences of introducing BSE into the United States 
from any country. In fact, because of the similarities between the 
measures in place in Canada and the United States, when CFIA conducted 
its assessment of the risk of BSE in Canada, it used the Harvard-
Tuskegee model as a base.
    APHIS conducted a separate analysis to determine the risk of BSE 
being introduced into the United States through live ruminants or 
ruminant products or byproducts imported from Canada, and concluded 
that it is unlikely that infectious levels of BSE would be introduced 
into the United States from Canada as under the proposed rule. Drawing 
on the Harvard-Tuskegee Study, then, APHIS also concluded that, even if 
the BSE agent were introduced into the United States, it would be 
extremely unlikely to enter commercial animal feed and thereby infect 
U.S. cattle, or to result in human exposure to the BSE agent. This is 
where the Harvard-Tuskegee Study is useful and directly applicable to 
this rulemaking.
    As discussed above, USDA commissioned the HCRA and the Center for 
Computational Epidemiology at Tuskegee University to conduct what we 
now refer to as the Harvard-Tuskegee Study in 1998. The objective of 
the Harvard-Tuskegee Study was to analyze and evaluate the measures 
implemented by the U.S. Government to prevent the spread of BSE in the 
United States and to reduce the potential exposure of Americans to the 
BSE agent. The Harvard-Tuskegee Study reviewed available scientific 
information related to BSE and other TSEs, assessed pathways by which 
BSE could potentially spread in the United States, and identified 
measures that could be taken to protect human and animal health in the 
United States.
    The Harvard-Tuskegee Study evaluated the potential for the 
establishment and spread of BSE in this country if 10 infected cows 
were introduced into the United States. The Harvard-Tuskegee Study 
concluded that, if introduced, BSE is extremely unlikely to become 
established in the United States (Ref 36). This conclusion was based on 
the estimation that ``the disease is virtually certain to be eliminated 
from the country within 20 years after its introduction'' under the 
model's base case assumptions (i.e., the most likely scenario) assuming 
10 infected cattle were introduced into the United States. The study's 
conclusions also were based on the preventive measures already in place 
in the United States at the time the study was conducted. The Harvard-
Tuskegee Study also concluded that, should BSE enter the United States, 
only a small amount of potentially infective tissues would likely reach 
the human food supply and be available for human consumption. For the 
purpose of quantifying both animal and human exposure to the BSE agent, 
the Harvard-Tuskegee Study expressed the amount of infectivity in terms 
of cattle oral

[[Page 507]]

ID50s. A cattle oral ID50 is the amount of 
infectious tissue that would be expected to cause 50 percent of exposed 
cattle to develop BSE. By tracking cattle oral ID50s in the 
tissues of cattle through slaughter, processing, rendering, animal 
feeding, and human consumption, the model can evaluate the human 
exposures and animal health consequences of introducing BSE in imported 
animals or meat.
    The Harvard-Tuskegee Study concluded that, based on conditions as 
they existed in 2001, the three practices that could contribute most to 
either human exposure or the spread of BSE, should it be introduced 
into the United States, were noncompliance with FDA's feed 
restrictions, rendering of animals that die on the farm and illegal 
diversion or cross-contamination of the rendered product in ruminant 
food, and inclusion of high-risk tissue, such as brain and spinal cord, 
in human food. As noted earlier in section III. C. in the discussion of 
Federal actions since December 2003, FSIS and FDA have implemented 
comprehensive safeguards that both agencies have concluded provide 
exceptionally effective protection to both human and animal health, and 
a higher level of protection than contemplated in 2001.
    Even without these additional safeguards, however, the Harvard-
Tuskegee Study concluded that, based on conditions as they existed in 
2001, if 10 infected cows were introduced into the United States, only 
five new cases of BSE in cattle would be expected. In fact, the 
Harvard-Tuskegee Study predicted that there was at least a 50 percent 
chance that there would be no new cases at all. The extreme case (95th 
percentile of distribution) predicted 16 new cases of BSE in cattle and 
180 cattle oral ID50s available for potential human exposure 
over 20 years. Even the highest of these predictions indicate a small 
number of cases of BSE and extremely small potential for human 
exposure. With the additional safeguards implemented in the United 
States in 2004 (i.e., the FSIS requirement that SRMs be removed from 
all cattle at slaughter and the condemnation of non-ambulatory disabled 
cattle presented for slaughter), this already small potential is 
reduced even further. This outcome is dramatically different from the 
experience in the United Kingdom, where it is estimated that there were 
nearly 1 million infected animals and millions of cattle oral 
ID50s were available for potential human exposure (Ref 36).
    In all cases, even the most extreme, the Harvard-Tuskegee Study 
concluded that the United States is highly resistant to the spread of 
BSE or a similar disease and that BSE is extremely unlikely to become 
established in the United States (where establishment is defined as 
continued occurrence after 20 years). Thus, APHIS' statement that the 
Harvard-Tuskegee Study found that, even if BSE were to enter the United 
States, it would be unlikely to spread, is an accurate representation 
of the Study's findings. Again, it must be emphasized that the Harvard-
Tuskegee Study did not factor in the additional safeguards in place in 
the United States today.
    As mentioned earlier in connection with our revised risk analysis, 
the HCRA recently updated its model using updated estimates for some of 
the model parameters, based on new data about compliance with feed 
restrictions. The results are even lower estimates of risk than 
previously predicted. This recent revision is discussed in more detail 
in the response to the next comment.
    Issue: The same commenter maintained that APHIS' risk analysis 
represented the Harvard-Tuskegee Study as being more definitive and 
reassuring than it really is by stating that the Study found, even if 
BSE were to enter the United States, that it would be unlikely to 
spread. The commenter said that APHIS gave inadequate consideration to 
worst case scenarios, which the commenter referred to as ``low-
frequency, potentially high health consequence events,'' and to the 
sensitivity analysis in the Harvard-Tuskegee Study.
    The commenter stated that the Harvard-Tuskegee Study reports that 
its sensitivity analysis indicates that the predicted number of 
additional cattle infected is particularly sensitive to the assumed 
proportion of ruminant meat-and-bone meal (MBM) that is mislabeled and 
the assumed proportion of properly labeled MBM that is incorrectly fed 
to cattle. The commenter stated that the predicted human exposure is 
likewise sensitive to these parameters. The commenter stated that 
assigning worst case values to even two of the three sets of parameters 
(demographic assumptions and MBM production; feed production; and feed 
practice) is sufficient to shift the conclusion based on the base case 
scenario that ``imported BSE cases will probably die out'' to 
``imported cases will probably start an epidemic.'' The commenter 
further stated that, even if a subset of the key drivers were assigned 
values within its allowed uncertainty range, spread of BSE is highly 
likely, which suggests the need for a much more thorough risk analysis. 
The commenter stated that the findings of the Harvard-Tuskegee Study 
should have driven USDA to commission additional refined data 
gathering, development of more refined models, and consequent refined 
risk analysis.
    Response: APHIS is confident that it appropriately represented the 
Harvard-Tuskegee Study as demonstrating that BSE would be unlikely to 
spread even if it were to be introduced into the United States.
    Sensitivity analysis evaluates the degree to which changes in the 
data used in a model affect the model's results. The Harvard-Tuskegee 
Study used a sensitivity analysis to mathematically evaluate the extent 
to which variations in input data affected the modeled results, 
including the likelihood that BSE would spread if introduced, rather 
than die out. The Harvard-Tuskegee Study evaluated the effects of 
changes when one model parameter was assigned a worst case value but 
other model parameters were held at values assigned in the base case, 
as well as the effects of assigning worst case values to multiple model 
parameters at the same time. (The base case values represent the 
Harvard-Tuskegee Study's, and USDA's, best estimates of what is likely 
to be representative of conditions in the United States. Extreme case 
scenarios are those in which some or all model parameters are given 
worst case values; in the worst of the extreme case scenarios, all 
model parameters are simultaneously assigned worst case values.)
    We evaluated the Harvard-Tuskegee Study's sensitivity analysis and 
extreme case scenarios and used the results as a key factor in reaching 
our conclusion that the risk from importing Canadian animals and 
products is very low.
    According to the Harvard-Tuskegee Study, changing the value 
assigned to most model parameters had only a limited influence on 
results. That is, even when they were assigned their worst case values, 
the results were not substantially different from what was predicted 
when all model parameters were assigned their base case values.
    The model parameters that had the most significant effects on the 
Harvard-Tuskegee model results were: (1) The misfeeding rate 
(proportion of correctly labeled prohibited feed that is incorrectly 
administered to cattle); (2) the feed mislabeling rate (proportion of 
prohibited feed incorrectly labeled as nonprohibited); and (3) the 
render reduction factor (amount by which the rendering treatment 
reduces the amount of BSE infectivity).
    When Harvard-Tuskegee conducted its original analysis in 2001,

[[Page 508]]

establishing realistic bounds for the values of some of these model 
parameters was complicated by the limited amount of available 
information. For example, data on feed ban compliance indicated the 
fraction of facilities out of compliance with the feed ban regulations, 
but not the fraction of all prohibited material passing through 
noncompliant facilities. Second, the data did not differentiate between 
technical violations (e.g., incorrect paperwork) and substantive 
violations. Harvard-Tuskegee therefore estimated the frequency of 
violations indirectly (Ref 36).
    Simultaneously assigning estimated worst case values to the model's 
demographic model parameters (i.e., proportion of animals that die on 
farm that are rendered, relative susceptibility vs. age for BSE in 
cattle, and the incubation period for BSE in cattle) and all MBM 
production, feed production, and feed administration model parameters 
at the same time resulted in a 75 percent chance that BSE would not 
become established in the United States. The ``upper tail of the 
distribution'' (i.e., the 25 percent chance that BSE would spread in 
the worst of the worst case scenarios) is what concerned the commenter.
    To reduce uncertainty about the importance of extreme case 
scenarios, we requested, as the commenter suggested, additional data 
gathering and refinement of the analysis. Specifically, we asked Joshua 
Cohen and George Gray at the HCRA in 2004 to refine its risk analysis 
to incorporate additional, more recent data on the mislabeling of 
products containing prohibited ruminant protein and the contamination 
of nonprohibited feeds with ruminant protein. Cohen and Gray ran the 
model using updated worst case values for model parameters related to 
ruminant MBM production and feed production. No new information on the 
rate of misfeeding was available, so Cohen and Gray continued to use 
the same value for misfeeding as had been used previously. However, 
because the misfeeding rate has the greatest influence on the predicted 
number of infected cattle following the introduction of BSE into the 
United States, Cohen and Gray ran multiple sets of simulations to 
determine how its value influenced the predicted results. Values tested 
included the original worst case value of 15 percent, as well as a 
range of values below that, from 0 percent to 12.5 percent.
    Cohen and Gray used the most recent FDA data to estimate 
probabilities for mislabeling and contamination in MBM production 
(rendering) facilities and feed production facilities. Mislabeling 
occurs when a producer fails to label a product with prohibited 
material (e.g., ruminant material) as ``Do not feed to cattle or other 
ruminants.'' Contamination may occur when a prohibited product is 
incorporated into a nonprohibited product, or when prohibited and 
nonprohibited products are handled by the same facility without proper 
segregation or cleaning and disinfection.
    Since the publication of the 2001 Harvard-Tuskegee Study, FDA has 
collected and distributed additional information on compliance with its 
feed restrictions that quantifies the number of facilities out of 
compliance and provides information on the nature of violations 
discovered. With respect to the number of noncompliant facilities, 
FDA's databases do not report the size of the facilities (i.e., amount 
of material produced), so Cohen and Gray conservatively estimated that 
noncompliant facilities were the same size on average as compliant 
facilities. With respect to data on the nature of violations 
discovered, Cohen and Gray relied on data collected by FDA before 
September 2003, because it provides better detail on the nature of 
violations than data collected afterward. Data collected before 
September 2003 is reported as the total number of firms with at least 
one violation and designates each violation as a case in which (1) 
products were not labeled as required; (2) the facility did not have 
adequate systems to prevent commingling, or (3) the facility did not 
adequately follow recordkeeping regulations. More recent data do not 
provide this level of detail.
    Cohen and Gray reported their results in a June 18, 2004, 
memorandum to the Agency (Ref 37). The following table (Table 2 in the 
analysis) shows the original and revised assumptions for rates of 
contamination and mislabeling at MBM production (rendering) facilities 
and feed production facilities.

                                  Assumptions for Mislabeling and Contamination
----------------------------------------------------------------------------------------------------------------
                                                    MBM production                      Feed production
                                         -----------------------------------------------------------------------
                                                                    Revised                             Revised
                Parameter                  Base case  Worst case  worst case   Base case  Worst case  worst case
                                           2003 \a\    2003 \a\       \b\      2003 \a\    2003 \a\       \b\
                                           (percent)   (percent)   (percent)   (percent)   (percent)   (percent)
----------------------------------------------------------------------------------------------------------------
Probability of contamination............        14          25           1.8        16          16           1.9
Proportion of prohibited material                0.1         1           1           0.1         1           1
 transferred to nonprohibited material
 per contamination event................
Mislabeling probability.................         5          10           2.3         5          33          4
----------------------------------------------------------------------------------------------------------------
\a\ Values from Cohen et al. (2003)
\b\ Values developed for the 2004 assessment.

    This table shows that, not only are the revised worst case 
estimates for certain of the model parameters much lower than the 
original worst case estimates, they are also lower than the base case 
estimates.
    The predicted results based on the revised estimates show, with 95 
percent confidence, that BSE will not spread if the misfeeding rate is 
7.5 percent or less. Even when higher misfeeding rates are assumed, 
however, the results indicate that BSE spread would be very slow.
    Using the terminology of the model, the value of R0 
determines whether the number of BSE infected cattle will increase or 
decrease over time and how rapidly. R0 is calculated based 
on information put into the model, including information on the number 
of infected animals slaughtered, the amount of infectivity remaining 
after rendering, and the quantity of ruminant MBM that is consumed by 
cattle. Values of R0 greater than 1 indicate an outcome 
where the number of infected animals will increase; values less than 1 
indicate an outcome where the disease will decrease and eventually 
disappear. The degree to which R0 is greater than or less 
than 1 is a measure of the rapidity with

[[Page 509]]

which the disease will increase or decrease.
    Using even the highest estimated misfeeding rate of 15 percent, 
Cohen and Gray found that the value of R0 is 1.23, only 
slightly higher than 1, which indicates a very slow rate of spread in 
the worst case. HCRA noted in its 2004 analysis that data to 
characterize the misfeed rate would be very useful and might make it 
possible to judge whether a misfeed rate of more than 7.5 percent is 
even plausible. Regardless, the risk of BSE spreading at even a very 
slow rate when the highest estimated misfeeding rate is used assumes 
that no further mitigation measures are taken that could prevent the 
disease from spreading in the cattle population. As mentioned 
previously, FDA continues to conduct inspections to monitor compliance 
of feed mills, renderers, and protein blenders with the 1997 feed ban 
rule and has expanded the scope of its inspections to monitor 
compliance with the 1997 feed ban rule.
    Issue: The same commenter stated further that the Harvard-Tuskegee 
Study noted that a ``true validation of the simulation model * * * is 
not possible'' due to lack of direct, real world experience with 
importing BSE-infected cattle.
    Response: Although the Harvard-Tuskegee model is not amenable to 
formal validation through controlled experiments that monitor and 
measure the consequences of introducing BSE into a country, Harvard-
Tuskegee did test its model using a real world situation. As a test of 
the model's plausibility, Harvard-Tuskegee modeled the small BSE 
outbreak identified in Switzerland following the introduction of BSE 
infectivity from the United Kingdom. Working with experts in 
Switzerland, the authors identified appropriate values for model 
parameters necessary to appropriately characterize that country's 
practices and procedures and then simulated the introduction of BSE 
infectivity. The simulation took into account risk management actions, 
such as feed bans instituted by the Swiss. HCRA found that the model's 
predictions were ``reasonably close to empirical observations (Ref 
38),'' providing confidence in the model's structure and approach.
    Issue: The same commenter stated that the need for more refined 
quantitative risk analysis is further increased by the fact that the 
Harvard-Tuskegee Study did not thoroughly model spatial (or other) 
heterogeneity of BSE risks. In other words, the Study did not, in the 
commenter's words, consider the extent to which some herds are 
particularly susceptible, or if other rare conjunctions of unfavorable 
conditions occur in a small fraction (e.g., less than 1 percent of 
cases) of a large number of replicates (e.g., farms, processing runs, 
etc.) each year in the United States, then, by chance, combinations of 
worst case conditions may occur several times per year at random 
locations, leading to sporadic adverse animal and human health events. 
The commenter further stated that the Harvard-Tuskegee Study authors 
noted something similar, stating, ``Many of the simulation results are 
`right skewed, meaning that the average value often exceeds the median 
(50th percentile) and can sometimes exceed even the 95th percentile.' 
'' The commenter stated that while the average case is reassuring, the 
extreme cases are not, and said that extreme cases need to be better 
quantified. Such analysis of low frequency, potentially high health 
consequence events from removing current restrictions on Canadian beef 
imports appears to have been omitted entirely from any of USDA's risk 
analyses, and is not fully addressed by the Harvard-Tuskegee Study, 
which indicates the possibility of such events but does not address 
them specifically for the Canadian situation, which was not the focus 
of that study.
    In summary, the commenter stated, it is not concern about the 
average case or base case alone that should inform the risk analysis 
component of decision making in this case, but concern about the less 
likely but high consequence events and the upper tail of the risk 
distribution that should be the focus of substantive analysis. Unless 
some credible information is provided about how frequently adverse 
events are expected to occur with and without the proposed changes, it 
is impossible to make an informed judgment about whether the economic 
benefits outweigh the human and animal health risks.
    Response: We disagree that the Harvard-Tuskegee Study did not model 
the heterogeneity of BSE risks sufficiently to allow it to provide 
meaningful information for decisions about this rulemaking. We believe 
that our risk analysis does provide sufficient information about the 
potential for adverse events.
    Specifically, the Harvard-Tuskegee Study considered differential 
susceptibility of cattle with respect to age, as well as differential 
infectivity by duration of infection and differential exposure by usage 
type and age. In their June 18, 2004, memorandum Cohen and Gray 
conclude ``There is no evidence that susceptibility differs 
substantially among animals of the same age * * * [E]ven if 
susceptibility does vary * * *, there is no reason to believe the 
Harvard-Tuskegee model would substantially * * * underestimate the 
degree to which the disease would spread * * *'' (Ref 37).
    The Harvard-Tuskegee Study did not consider heterogeneity in 
virulence of BSE strains, clustering of rare events within geographic 
areas or affected populations, or varying susceptibility between breeds 
of cattle. The commenter did not provide any evidence or data to show 
that such heterogeneities exist, and we are unaware of any such data or 
evidence that would allow the modeling suggested by the commenter. To 
our knowledge, there is nothing in the scientific literature that 
concludes that one herd or breed is more susceptible to BSE than 
another. Cohen and Gray concur (Ref 37). We also note that, while 
samples from a few cattle in Japan and Italy have recently demonstrated 
some unusual patterns on Western blot tests, which suggests a 
possibility that different strains of BSE may exist, the evidence is 
far from conclusive and could be explained by other factors (Ref 39). 
Thus, there is no information at this point about the existence of 
different strains, much less about differences in virulence among 
strains, that could be modeled. In the absence of such data or 
evidence, any consideration of the potential impacts of these 
heterogeneities would be purely hypothetical and speculative, and would 
not provide an appropriate basis for making regulatory decisions. 
However, we continue to monitor the latest scientific research, and 
will certainly consider any significant information that becomes 
available.
    APHIS' risk analysis evaluated known BSE risks and provided a 
rational, scientific basis for our classification of Canada as a BSE 
minimal-risk region and for determination that the application of 
specified mitigation measures would allow for the safe importation of 
certain animals and products from Canada. Further, our assessment of 
actions taken by the Canadian Government lead us to place Canada on the 
list of BSE minimal-risk regions.
Data and Uncertainties
    Issue: The same commenter asserted that USDA's recent re-analysis 
(the Explanatory Note) was not adequately sensitive to data and did not 
attempt to address uncertainties and that its conclusions are, 
therefore, unsupportable.
    Specifically, the commenter said that APHIS' conclusion and 
supporting reasoning that the second case does not alter the risk 
estimate ``violates

[[Page 510]]

principles of sound statistical inference and risk assessment, which 
teach that observing a second adverse event in a monitored population 
in a comparatively short period of time after the first observation is 
informative and should significantly inform (i.e., update) data-driven 
risk estimates, especially when there is a high prior uncertainty about 
model parameters.''
    Codex Alimentarius and other sources, said the commenter, specify 
that a risk analysis should include uncertainty analysis. The commenter 
said that major technical questions and uncertainties that should be 
addressed and modeled include: the roles of horizontal and vertical 
transmission (if any); susceptibility distribution within cattle of the 
same age; variability of virulence of different new BSE cases; 
proportion of infected animals in Canada (``low'' we are told, but how 
long, on what basis, and with what confidence); detection probability 
per case (and hence the number of true cases per observed case); the 
age distribution at first infection; the latency period (and its 
distribution) until expression; the potential for clustering of rate 
events within geographic areas, processing plants, affected 
populations, etc.; the status and extent of current and future 
compliance and attendant consequences of noncompliance (such as 
mislabeling, etc.) in Canada and the United States; and differences in 
the likelihood of spread of BSE in different geographic areas or for 
different strains of BSE, different types of cattle, etc. The commenter 
maintained that these and other sources of uncertainty make initial 
perceptions about risk sufficiently uncertain that the number of cases 
of BSE actually detected should shape updated beliefs. When the 
observed rate increases from one to two detected cases in the past 
year, said the commenter, estimated risks should increase 
correspondingly. (In Bayesian terms, noted the commenter, the prior 
should be sufficiently diffuse or noninformative, given the above 
uncertainties, so that the posterior is heavily driven by the data, 
rather than by the prior * * *).
    Response: We disagree with the suggestion that a second infected 
cow of Canadian origin should have altered the conclusions of our risk 
analysis--namely, that the BSE risk associated with importing ruminants 
and ruminant products and byproducts from Canada as proposed would be 
very low. Our Explanatory Note explained that a comprehensive 
investigation conducted by APHIS in coordination with Canadian 
authorities indicated that the second BSE-positive animal, found in 
Washington State, most likely became infected in Canada before Canada's 
feed ban was put in place in 1997. The apparent or reported rate of 
disease is meaningful when considered in conjunction with the level and 
quality of disease surveillance and from the position on the epidemic 
curve. Canada is well below the reported incidence rate that the OIE 
recommends for minimal-risk status (i.e., 2 detected cases per million 
animals during the last 4 consecutive 12-month periods) and, with over 
15,800 animals tested as of December 1, 2004, Canada far exceeds the 
OIE surveillance guidelines for BSE. Further, Canada implemented import 
restrictions and a feed ban prior to detection of BSE in any indigenous 
animals. The downward pressure exerted by a feed ban--which the early 
experience in the United Kingdom demonstrated to be substantial even if 
only partially implemented--and the time of controls before detection 
of the disease indicate that it is more likely that the incidence of 
BSE is decreasing in Canada rather than increasing. Although the 
reported or apparent incidence of BSE in Canada has increased since May 
2003, we are also aware that infected animals born before the feed ban 
in 1997 have entered the age when they are more likely to be detected, 
given the incubation period, and that surveillance for BSE in North 
America has increased. APHIS' designation of Canada or any country as a 
BSE minimal-risk region is based on the sum total of a country's 
prevention and control mechanisms for the disease. These include import 
restrictions, surveillance, feed restrictions, epidemiological 
investigations, and other measures. It is our view that these factors, 
evaluated together, provide a better indication of a country's BSE risk 
than any single numeric threshold criterion for BSE incidence. 
Therefore, while the discovery of a second infected cow alters Canada's 
reported incidence rate, the change does not affect the conclusions of 
our risk analysis. Similarly, it would not have affected Canada's 
categorization or classification as a BSE minimal-risk region according 
to OIE guidelines. We note in particular that this rule will not allow 
the importation of cattle born before Canada implemented its feed ban.
    In its decisionmaking, APHIS considered both qualitative and 
quantitative information. With regard to uncertainty analysis, although 
APHIS' risk analysis for the proposed rule did not include a separate 
section entitled ``Uncertainty Analysis,'' the analysis did, in fact, 
address uncertainty throughout.
    For example, in its analysis of BSE risk from imports from Canada, 
APHIS' risk analysis documented and described the current state of 
knowledge of BSE epidemiology based on the outbreaks in the United 
Kingdom and other parts of Europe. While the analysis indicates that 
BSE transmission occurs primarily through contaminated feed, it also 
states that uncertainty exists as to whether this is the only mechanism 
by which the disease may be spread. Having considered this lack of 
certainty, APHIS errs on the side of caution by requiring further risk 
mitigation measures, as discussed in the risk analysis, such as age 
limitations on live animals imported into the United States. The risk 
analysis states, ``* * * [A]lthough risk factors can be identified with 
some certainty, individual risk mitigation measures may be difficult to 
apply precisely. For example * * * it has not been established with 
certainty that contaminated feed is the only pathway. Furthermore, it 
cannot be assumed that there is complete compliance with a feed ban, 
which is the most effective mitigation for contaminated feed. 
Therefore, [APHIS] considered it necessary to mitigate risk arising 
from alternate pathways or lack of compliance with a feed ban.''
    The Harvard-Tuskegee Study (Ref 3), referred to in the context of 
APHIS' risk analysis, uses probability distributions. That Study 
includes probability distributions for many of the model's parameters, 
including the age at which animals first become infected, the 
incubation period of BSE, and the level of compliance with a feed ban. 
Use of these probabilistic input parameters allows the results of the 
Harvard-Tuskegee Study to be expressed probabilistically, thereby being 
explicit about the implications of several key sources of uncertainty 
inherent in the model.
    We did not attempt to estimate the number of BSE-infected animals 
that might be imported into the United States under this rule. We have 
confidence in Canada's BSE control measures and the rule's required 
mitigation measures and note, further, that BSE incidence and 
surveillance in Canada are well within the OIE guidelines for BSE 
minimal risk. We note further that the Harvard-Tuskegee Study concluded 
that, even if a small quantity of infectivity were introduced into the 
United States, it is not likely to cause the establishment of BSE.
    With respect to the commenter's assertion that there is so much 
uncertainty about the situation in

[[Page 511]]

Canada that detection of the second infected cow should be given 
significant weight in shaping our beliefs, we disagree that we failed 
to adequately consider the data or to give appropriate weight to the 
detection of BSE in a second cow of Canadian origin.
    Although the commenter suggests that APHIS should have used a 
Bayesian technique in estimating the prevalence of BSE in Canada, such 
a technique would have started with the same information base-it would 
have been informed by the available historical surveillance data, 
including that acquired since implementation of the Canadian feed ban 
and import restrictions, which would be relevant to the current 
prevalence estimate. The projected trajectory of the disease is down, 
because of the downward pressures the measures have been shown to exert 
on the incidence of disease in such a region. We know that Canada had 
two indigenous cases of BSE in an adult cattle population of 5.5 
million (a reported incidence rate that is well within the OIE 
guidelines for a minimal-risk country). Even before the discovery of 
two Canadian-origin animals with BSE, we had information from both 
active and passive surveillance about the prevalence of BSE in Canada 
and we would have used that information to construct a prior 
distribution. Finally, we note Canada has tested thousands of animals 
for BSE, and Canadian surveillance since the most recent detected case 
has increased significantly. As of December 1, 2004, Canada had tested 
over 15,800 animals in 2004 with no additional BSE cases found.
    Issue: The same commenter stated that USDA should conduct a risk 
analysis that, in addition to addressing the uncertainties already 
listed in the comment concerning the second case, addresses the 
following:
Exposure
     What is the probable prevalence of BSE in Canada now and 
in the future under the proposed conditions. The modeling should 
explicitly document the data and assumptions used to answer it, 
specifically including compliance rates with any existing or future 
management strategies such as feed bans.
     What is (and has been) the likely age distribution of BSE 
infections among Canadian ruminants over time? A variety of models from 
the United Kingdom and Japan address the issue of ``hidden'' 
(unobserved) prevalence and the age distribution of unobserved cases.
Exposure-Response
     What is the probability distribution for R0 
(R0 being the likelihood that the disease will amplify or 
diminish over time)?
     What is the frequency distribution of R0 in 
different herds/locations/populations in the United States where 
Canadian ruminants might be imported?
Risk Characterization
     How much would the probability of a U.S. epidemic in the 
next 10 years increase if Canadian ruminants are imported under the 
proposed conditions? (This is driven by the probability that 
R0 > 1 and the expected time until the first BSE import 
starts an epidemic.)
     If R0 < 1, then how would the equilibrium level 
of sporadic outbreaks or cases in the United States increase if 
Canadian ruminants are imported? What is the total harm per outbreak? 
Putting these two together, what is the increment (mean and variance) 
in flow of harm per unit time from allowing the imports?
    Response: A thorough discussion of why it is not necessary to 
determine a precise numeric measurement of prevalence of BSE in the 
Canadian cattle population follows, under the heading ``Prevalence of 
BSE in Canada.''
    The commenter's other points seek to determine the likelihood of 
different scenarios occurring, given changes in variables. As explained 
previously, APHIS largely based its conclusions about the likelihood of 
BSE spreading if introduced into the United States on the Harvard-
Tuskegee Study. The Harvard-Tuskegee Study evaluated the effects of 
changes when one model parameter was assigned a worst case value but 
other model parameters were assigned base case values, as well as the 
effects of assigning worst case values to multiple model parameters at 
the same time. We are confident that the extreme scenarios presented by 
Harvard-Tuskegee are extremely unlikely to occur and that the base case 
represents the most likely scenario given the available information. 
Cohen and Gray's memorandum (Ref 37), discussed in response to a 
previous comment, substantiates this. Second, we are confident that, 
even if the most extreme case occurred, few cases of BSE would result 
and even fewer cases of vCJD. Again, this is substantiated by Cohen and 
Gray's memorandum, which indicates that even in the most extreme case, 
the disease will still spread very slowly, leaving time to intervene. 
Neither the Harvard-Tuskegee Study nor the Cohen and Gray memorandum 
considered recently strengthened safeguards on slaughter practices, 
including a ban on the use of air injection stunning devices, 
requirements for removal of SRMs, and a ban on the use of nonambulatory 
cattle in human food, that would provide further increases in 
protection for human and animal health.
    Issue: The same commenter stated that APHIS' assertion that it is 
unlikely that BSE would be introduced from Canada under the proposed 
rule is not the result of any rational analysis based on independently 
verifiable, explicit calculations from data. In fact, said the 
commenter, applying the methods of the Harvard-Tuskegee Study, some BSE 
imports would be expected under the proposed rule if the age 
distribution of BSE in beef and the probability of erroneous labeling 
or routing put at least some positive probability, even if only 0.0001 
percent per animal, on such an import.
    Response: We disagree with the comment and with the assumption 
inherent in it. Our decision and the critical evaluation and analyses 
on which it is based are scientifically sound and entirely consistent 
with our statutory authority. APHIS, and indeed all regulatory 
agencies, are called upon each day to make informed and reasonable 
decisions without numerical calculations. APHIS has made such decisions 
for years. Although rigorous experimental research, which forms the 
scientific basis for determining which tissues harbor the BSE agent in 
infected cattle, can be fed into computer modeling, it is not necessary 
in all cases to base decisions on numerical calculations. There is a 
wide body of independently verifiable scientific evidence regarding 
BSE, including how to control and eliminate the disease. Based on 
qualitative and quantitative evidence, we have concluded that the risk 
associated with imports under this rulemaking is very low. Regarding 
the commenter's second point, we did not assert that there is zero 
probability that BSE would be introduced from Canada under the 
conditions we proposed. Rather, we concluded that such imports are 
unlikely. Furthermore, the Harvard-Tuskegee Study demonstrated that, 
even if a small amount of infectivity were introduced into the United 
States, it would be unlikely to spread and result in the establishment 
of BSE. In accordance with the Animal Health Protection Act, the 
Secretary has concluded quite reasonably that restrictions on the 
importation of ruminant meat and meat products from Canada, but not 
prohibition of those

[[Page 512]]

commodities, is necessary to prevent the introduction of BSE from 
Canada.
    APHIS carries out an array of animal and plant health regulatory 
programs, governing both domestic and imported commodities. In none of 
these programs, many of which have been in place for years, is it 
possible to assure that there is zero risk. Indeed, were we to make 
trade dependent on zero risk, foreign, as well as interstate, trade in 
animals and animal products would cease to exist.
    Issue: The same commenter quoted APHIS as stating that, 
``[a]lthough the BSE-infected cow in Washington State was more than 30 
months of age when diagnosed, it was obviously not imported under the 
conditions of the yet-to-be-implemented proposed rule and would not 
have been allowed to be imported under the proposed rule.'' The 
commenter said that USDA has not shown it is impossible for BSE to 
occur in some cattle less than 30 months of age or that some cattle 
older than 30 months of age might be inadvertently imported.
    Response: As discussed above, the epidemiological investigation 
conducted by APHIS and others following the detection of BSE in a cow 
in Washington State in December 2003 indicated that the cow was born in 
Canada early in 1997 before Canada initiated a feed ban. This animal 
and all others born before Canada's feed ban would now be at least 7 
years old. Because the rule requires that all cattle imported into the 
United States from Canada be less than 30 months old, no animals born 
before Canada's feed ban will be allowed to enter the United States 
under this rule. Furthermore, the rule also requires that cattle 
imported from Canada be slaughtered before they are 30 months of age. 
In actual practice, because cattle imported into the United States from 
Canada will be coming in for slaughter or for feeding and slaughter, 
the large majority will be less than 24 months of age (most male cattle 
are slaughtered before 24 months of age). FSIS has established 
procedures for checking an animal's age at slaughter through records 
and/or dentition. These procedures apply to both domestic and imported 
cattle and we are confident they are effective in determining age. The 
appropriate SRMs based on age will be removed from any cattle that are 
determined to be 30 months of age or older based on those procedures, 
and APHIS will take enforcement action as necessary.
    With regard to the possibility that BSE could occur in cattle 
younger than 30 months of age, research demonstrates that the shorter 
incubation period (i.e., infection developing in less than 30 months) 
is apparently linked to younger animals receiving a relatively large 
infectious dose (Ref 40). The younger cases have occurred primarily in 
countries with significant levels of circulating infectivity. 
Specifically, BSE was found in animals less than 30 months of age in 
the United Kingdom in the late 1980's to early 1990's, when the 
incidence of BSE was extremely high. This research also suggests that a 
calf must receive an oral dose of 100 grams of infected brain material 
containing high levels of the infectious agent to produce disease 
within a minimum of approximately 30 months (Ref 40). All available 
evidence leads to the conclusion that the level of infectivity in the 
Canadian cattle population is low and that compliance with the feed ban 
is high. Further, infectivity in animals younger than 30 months has in 
most cases been confined to tonsils and distal ileum, both of which 
would be removed at slaughter in the United States.
Prevalence of BSE in Canada
    Issue: The same commenter specifically argued that APHIS should 
present quantitative evidence of the true prevalence of BSE in Canada 
and that the risk analysis for the rule should take this into account. 
The commenter said that the risk analysis only discusses the prevalence 
of BSE in Canada in vague, subjective terms such as ``very low'' and 
``unlikely'' to generate cases in the United States, but that recent 
history now suggests that figure is 100 percent. The commenter asserted 
that more quantitative information is needed on the likely prevalence 
of BSE infections in Canadian ruminants and ruminant products that 
would be imported under the proposed rule (true prevalence, not just 
detected or qualitatively perceived). How likely is it, asked the 
commenter, that BSE prevalence in Canada could be 0.01 percent or 0.1 
percent, or 1 percent, given current and prior testing? The commenter 
stated the belief that available data could help provide useful upper 
bounds.
    Response: We disagree with the comment. Precise measurement of true 
prevalence of BSE is difficult to achieve, given the constraints of 
current testing methods available. It should be noted that no country 
in the world is attempting to officially define the true prevalence of 
BSE in its entire cattle population. Reports of incidence rates are 
indications of detectable levels of disease. Current testing 
methodology can only detect BSE, at the earliest, a few months before 
an animal exhibits clinical signs and, therefore, limits the ability to 
measure true prevalence in the entire cattle population. Data obtained 
through targeted surveillance can be extrapolated to make inferences 
about prevalence in broader populations as necessary. However, a 
specific calculation of true prevalence of BSE is not necessary to 
determine whether risk management policies or control policies are 
appropriate or need to be changed, and the importance of determining an 
exact prevalence rate should not be overstated.
    We also disagree with the commenter's assertion that APHIS needs to 
establish a more precise estimate of the true prevalence of BSE in 
Canada for this rulemaking. Our risk analysis presented compelling 
evidence that the prevalence of BSE in Canada is low. The absence of a 
precise numeric measurement of prevalence of BSE in the Canadian cattle 
population is not an absence of information to inform estimates. As we 
have stated, we will use a combined and integrated approach that 
examines the overall effectiveness of control mechanisms in place when 
evaluating a country for BSE minimal risk. We believe that such an 
evaluation will provide a better indication of a country's BSE risk 
than simply a numeric threshold for BSE incidence or prevalence.
    The threshold for incidence set by OIE for BSE minimal-risk regions 
is less than 2 cases per million cattle over 24 months of age during 
each of the last four consecutive 12-month periods. There have been two 
cases of BSE in Canadian-origin cattle since May 2003 out of an adult 
(over 24 months of age) cattle population of 5.5 million (0.4 per 
million) and no cases before May 2003. While we recognize that the 
number of detected cases does not, by itself, allow for a determination 
of prevalence, the number may be taken as a strong indication in 
countries with active surveillance that the mitigation measures in 
place to prevent the introduction and spread of BSE are working, thus 
prevalence is likely to be low. As we have discussed elsewhere, this is 
the case in Canada, which has had strict import controls in place since 
1978 and instituted its feed ban, equivalent to that of the United 
States, on the same date as the United States in August 1997. Canada 
has also conducted surveillance for BSE since 1992 and has met or 
exceeded OIE guidelines for surveillance since 1995. It should be noted 
that OIE guidelines refer to the reported incidence of BSE infection or 
levels of detectable disease.
    The commenter is incorrect in asserting that recent history 
suggests that Canadian imports are 100 percent likely to generate cases 
of BSE in the United States. While our risk analysis

[[Page 513]]

evaluated whether an infected ruminant or ruminant product from Canada 
might be imported, and concluded that the risk was considered ``low,'' 
that risk was considered in the context of the proposed mitigation 
measures. In addition, the risk analysis considered the likelihood that 
such an animal or product would spread the disease to other animals 
within the United States; in other words, whether the imported source 
of infectivity would generate new cases within the United States.
    Issue: The same commenter asserted that the HCRA's ``Evaluation of 
the Potential Spread of BSE in Cattle and Possible Human Exposure 
Following Introduction of Infectivity into the United States from 
Canada'' (Ref 10) (referred to below as the Canada Study) contradicts 
the statement in APHIS' risk analysis that the prevalence of BSE in 
Canada is ``low.'' According to the commenter, the Canada Study states 
that the prevalence of BSE in Canada cannot be determined because of 
the absence of strong evidence about the prevalence of BSE in the 
Canadian herd. The commenter also took issue with a statement we made 
that, although a second case of BSE was detected in an animal of 
Canadian origin, the total number of diagnosed cases attributed to that 
country remains low. According to the commenter, this statement is 
irrelevant and misleading. The commenter said that what matters for 
risk assessment purposes is the occurrence rate per unit time, not the 
total (cumulative) number ever diagnosed, and that two diagnosed cases 
in less than 1 year is not self-evidently a ``low'' rate.
    Response: APHIS' assessment of the prevalence of BSE in Canada was 
related to the small number of cases detected through an active 
surveillance program, and was not contingent upon there being only one 
case. The statement from the Canada Study that the prevalence of BSE in 
Canada cannot be determined is taken out of context and used by the 
commenter to imply that no judgment about the prevalence of BSE in 
Canada may be made. The Canada Study actually stated that, in the 
absence of strong evidence about the prevalence of BSE in the Canadian 
herd, the authors chose to posit a hypothetical introduction of five 
BSE-positive bulls into the United States instead of calculating a 
probability of such an introduction. The model used by the HCRA was not 
set up to gauge the probability of the introduction of BSE into the 
United States, but rather to calculate the outcome if the BSE agent 
were introduced. Moreover, the unavailability of precise data for a 
quantitative estimate of the prevalence of BSE in Canada does not 
preclude an evaluation and judgment about the prevalence of BSE in 
Canada. APHIS proposed to classify Canada as a minimal-risk region 
after considering substantial evidence about the BSE situation in that 
country, including information on the incidence of cases of BSE and 
level of surveillance, as well as other relevant factors such as the 
quality of Canada's BSE surveillance program and its veterinary 
infrastructure.
    Issue: The same commenter stated that, until the source of 
contaminated feed for the two cows is determined, it is not possible to 
determine whether infectivity occurred before or after the feed ban was 
implemented in Canada because of the animals' ages and the 2-8 year 
incubation period for BSE. The commenter asserted that, if the 
infectivity occurred after the feed ban was implemented, this suggests 
a continuing risk of BSE in younger Canadian cattle. The commenter 
therefore maintained that APHIS must determine the source of the 
contaminated feed or test more representative samples of Canadian 
cattle to conclude that the prevalence of BSE in Canada is low. 
Specifically, said the commenter, Canada plans to test 8,000 head in 
the next 12 months under limited surveillance; it should be required to 
test all cattle over 24 months of age for 2 years. The United States 
should not relax restrictions for countries of unknown prevalence.
    Response: As discussed previously, we disagree that Canada is a 
country of unknown prevalence for BSE or that a precise measurement of 
prevalence must be made before cattle from Canada are allowed to be 
imported into the United States. As determined by the epidemiological 
investigations conducted after their detections, both the May and 
December 2003 cases of BSE involved cows born before Canada implemented 
its feed restrictions. Both cows were most likely to have become 
infected by consuming contaminated feed at very early ages, most likely 
before the feed ban was implemented.
    Animals born before Canada's feed ban would now be at least 7 years 
old. At this stage of the incubation period, most remaining cattle 
infected before the feed ban was implemented would be symptomatic. In 
light of the active surveillance program in Canada, as well as 
restrictions on the slaughter of animals with symptoms compatible with 
BSE, any such infected cattle are likely to be detected and to be 
eliminated from the food chain. Because this rule requires that all 
cattle imported into the United States from Canada be less than 30 
months old at the time of importation and slaughter, no animals born 
before Canada's feed ban will be allowed to enter the United States 
under this rule. The age of cattle can also be verified at the time of 
slaughter through records and/or dentition. As noted above, the 
appropriate SRMs based on age will be removed from any cattle that are 
determined to be or suspected of being 30 months of age or older and 
enforcement action will be taken as necessary by APHIS. Further, as 
noted in response to a previous comment concerning the possibility that 
BSE could occur in cattle younger than 30 months of age, infectivity in 
such young animals has been associated with a high incidence of 
infectivity in the cattle population where the animal originates. This 
is not the case with Canada. Further, infectivity in animals younger 
than 30 months has in most cases been confined to tonsils and distal 
ileum, both of which would be removed at slaughter in the United States 
and Canada.
    Issue: One commenter stated that the APHIS risk analysis builds 
upon the Harvard-Tuskegee Study's conclusion that the introduction of 
BSE into the United States would be an unlikely event. However, the 
fact that the remains of the December 2003 cow are known to have 
entered the food chain renders APHIS' risk analysis relative to human 
health issues nonapplicable and outdated.
    Response: We disagree. The Harvard-Tuskegee Study did not address 
the likelihood of the introduction of BSE infectivity into the United 
States. However, the Harvard-Tuskegee study did conclude that, even if 
a small amount of BSE infectivity were introduced into the United 
States, the disease is unlikely to spread and become established. We 
are confident that the incidence of BSE in U.S. cattle, if any, is and 
will remain extremely low.
    The epidemiological investigation that was conducted following 
detection of an imported cow in Washington State (Ref 4) determined 
that the animals was born before implementation of a ban in Canada on 
feeding mammalian protein to ruminants and was most likely to have 
become infected before that feed ban was implemented. Additionally, the 
investigation determined that the animal was imported into the United 
States in 2001 at approximately 4 years of age, was more than 30 months 
of age when diagnosed, and clearly would not have qualified for 
importation under the provisions of this final rule.
    To date, BSE has never been confirmed in indigenous U.S. cattle. We 
cannot state with certainty that BSE will

[[Page 514]]

never occur in indigenous animals or that material from BSE-infected 
animals will never enter the human or bovine food supply. We note, 
however, that an interim rule published by FSIS on January 12, 2004, 
excludes all non-ambulatory disabled cattle and all SRMs, regardless of 
the health status of the animal from which they are taken, from the 
human food supply. In addition, FDA has banned any material from non-
ambulatory cattle and SRMs from all cattle from FDA-regulated human 
food, including dietary supplements, and cosmetics. These rules and 
other Federal measures described previously ensure stringent protection 
of the U.S. food supply.
    Issue: One commenter said that the term ``isolated cases'' used in 
the March 4 request for comment is very subjective and asked how we 
could use the word ``isolated'' when we do not know the prevalence of 
the disease in the Canadian national herd. The commenter stated that we 
should clarify what we meant so that appropriate comment could be 
provided on whether to allow high-risk, over 30-month-old, animals into 
the United States. The commenter stated further that USDA should not 
relieve restrictions on imports from Canada until Canada tests a 
significant percentage of its cull animals, with a major emphasis on 
the highest risk animals, over the next 2-5 years, without any 
significant positive findings.
    Response: The terms ``isolated cases'' and ``isolated'' were not 
used in the March 2004 notice or the Explanatory Note., nor did APHIS 
propose to allow the importation of any live cattle over 30 months of 
age from Canada.
    Finally, as discussed in response to several comments, we do not 
believe it is necessary to wait to relieve restrictions on imports from 
Canada until such testing as the commenter suggests has been conducted. 
Although active surveillance must be conducted to ensure that 
prevention and control measures implemented by a country are providing 
adequate protection, there is sufficient evidence already, based on 
nearly a decade of active surveillance in Canada at levels that have 
met or exceeded OIE guidelines, for us to conclude that Canada's 
prevention and control measures have been effective.
    Issue: One commenter said that the discovery of a Canadian cow with 
BSE in Washington State, coupled with the previous finding of a BSE cow 
in Alberta, indicates that the Canadian feed supply was contaminated as 
late as 1997. The commenter stated that the infected cattle were from 
two different herds and utilized different feed sources and concluded 
that other infected cattle undoubtedly exist. The commenter also 
concluded that since both the United States and Canada have been doing 
surveillance for several years without a diagnosed case, these cases 
must be considered as the first cases to appear on the epidemiological 
curve. The commenter stated further that the epidemiological curve for 
BSE is an extended one and must be considered at this time likely to 
continue for several more years, perhaps 5 to 10, and that no Canadian 
cattle should be allowed to enter the United States until sufficient 
time has elapsed for any remaining infected cattle to be identified and 
removed from the Canadian cattle population.
    Response: We disagree with the comment. While it is possible that 
additional BSE-infected cattle may exist in Canada, we have confidence 
that if such cattle do exist the number is small. First, Canada has not 
imported ruminant MBM from any country with BSE since 1978 (Ref 12). 
Second, Canada has prohibited the feeding of ruminant MBM to ruminants 
since August 1997, and CFIA has verified high levels of compliance with 
the feed ban by routine inspections of both renderers and feed mills 
(Ref 12). Third, Canada has traced and destroyed all remaining cattle 
imported from the United Kingdom (Ref 12). Fourth, Canada has traced 
and destroyed the majority of the cattle that comprised the birth 
cohorts of the two Canadian BSE cases (Ref 11 and 13). Fifth, Canada 
has conducted surveillance for BSE since 1992 and has conducted 
targeted surveillance at levels that have met or exceeded OIE 
guidelines since 1995 (Ref 12 and 13).
    Even if BSE-infected cattle do remain in Canada, they are likely to 
be older animals that were exposed before Canada's feed ban in 1997. 
Because this rule requires that imported animals be less than 30 months 
old, such animals could not legally enter the United States under this 
rule. Even if an infected cow did enter the United States, the Harvard-
Tuskegee Study indicates it would be unlikely to lead to the spread of 
BSE in cattle or to human exposure to the BSE agent.
    Regarding the suggestion that the two BSE-infected Canadian cows 
must be considered as the first cases to appear on the epidemiological 
curve, we disagree. The evidence strongly indicates that the two 
Canadian cases do not represent the beginning of a multi-year, 
exponentially expanding outbreak such as occurred in the United 
Kingdom. In the United Kingdom, where BSE was first detected, measures 
to prevent and control the spread of the disease were implemented only 
after the disease had reached epidemic proportions. In countries such 
as Canada, where effective measures were implemented before detection 
of any case of BSE, and well before detection in any indigenous animal, 
the situation is quite different. The best scientific evidence from the 
United Kingdom and other countries is that BSE is spread primarily by 
contaminated feed and that prohibiting the feeding of ruminant-origin 
protein to ruminants prevents disease spread. Canada has had such a 
feed ban for over 7 years. While a few older animals born before Canada 
initiated its feed ban may have been exposed to BSE and may yet develop 
clinical signs, Canada has taken every necessary step to prevent an 
epidemic. While additional cases may occur in cattle born before 
implementation of Canada's feed ban, the epidemiological evidence 
indicates the number of new cases, if any, will be limited by the 
downward pressure of the comprehensive mitigations in place.
    Issue: One commenter stated that, because the source of infection 
has not been identified for either BSE-positive cow of Canadian origin, 
the possibility exists that more asymptomatic cases may be present in 
Canadian herds, and that additional BSE-positive cattle have already 
gone to slaughter. The commenter stated that APHIS should not relieve 
restrictions on importations from Canada in the midst of an outbreak of 
uncertain size. Another commenter expressed concern that Canada 
admitted to identifying two feed mills not in compliance with the 
mandate to cease mixing mammalian tissue into cattle feed. The 
commenter stated that these mills were the source of the feed that led 
to the two identified cases of BSE in Canadian cattle.
    Response: As we stated in the March 2004 Explanatory Note to our 
risk assessment, epidemiological evidence indicates that both of the 
BSE-infected animals of Canadian origin were born before implementation 
in that country of a ban on the feeding of ruminant protein to 
ruminants, that they were most likely exposed to the BSE agent through 
consumption of contaminated feed, and that epidemiological follow-up 
has identified the feed mills where the contaminated feed most likely 
originated.
    From an epidemiological standpoint, it would be virtually 
impossible to definitively pinpoint a ``source of infection'' that 
occurred over 7 years ago. Canada has, however, evaluated the various 
potential sources of infection and has concluded that the source of

[[Page 515]]

infection was most likely a bovine imported from the United Kingdom in 
the 1980's.
    We agree it is possible there may be other asymptomatic BSE-
infected animals in Canada. However, because the two BSE-infected 
animals were born before the feed ban, there is no evidence to suggest 
that the feed ban is ineffective. The feed mills identified as having 
provided possibly infected feed most likely distributed that feed 
before the ban was implemented. The feed mills complied with CFIA feed 
ban regulations after they were implemented and have a good compliance 
record based on CFIA inspections. CFIA indicates that with respect to 
the inedible rendering sector, full compliance with the feed ban 
requirements has been consistently achieved, and that with respect to 
the Canadian commercial feed industry, non-compliance of ``immediate 
concern'' has been identified in fewer than two percent of feed mills 
inspected during the period April 1, 2003, to March 31, 2004. Those 
instances of noncompliance of ``immediate concern'' are dealt with when 
identified (Ref 11). According to CFIA, non-compliance of immediate 
concern includes situations where direct contamination of ruminant feed 
with prohibited materials has occurred, as identified through 
inspections of production documents or visual observation, and where a 
lack of appropriate written procedures, records, or product labeling by 
feed manufacturers may expose ruminants to prohibited animal proteins.
    An effective feed ban is an important part of the mitigation 
measures proposed for the importation of ruminants and ruminant 
products from a BSE minimal-risk region. However, the feed ban is not 
the sole mitigation in this rule. In addition to the risk-mitigating 
effect of the feed ban, importations of cattle and cattle products will 
also be subject to the import restrictions described in this rule. 
Those restrictions are based on the scientifically demonstrated 
likelihood of the BSE agent residing selectively in various tissues of 
animals of specified species and ages. Based on our analysis of the 
risk of such importations, it is highly unlikely that the BSE agent 
will be transmitted to the cattle population of the United States or 
into the U.S. human food supply through ruminants or ruminant products 
or byproducts imported into the United States under this rule.
    Additionally, the rule prohibits the importation of any cattle 30 
months of age or older, which includes cattle born before Canada 
implemented its feed ban. This age restriction was not in place when 
the cow that was detected as positive for BSE in December 2003 was 
imported into the United States.
    Issue: One commenter expressed concern that some cattle under 30 
months of age and, therefore, eligible for importation from Canada 
under the proposed rule, might be offspring of cattle born before the 
feed ban (and thus offspring of potentially infected cattle). The 
commenter noted that Canadian officials indicated that 68 British 
cattle that died or were slaughtered in Canada more than 10 years ago 
are the probable source of the original BSE infection in Canada. The 
commenter stated that current OIE guidelines do not recommend the 
immediate culling of offspring in the case of index or cohort animals, 
provided they are excluded from food and feed chains at the end of 
their lives. The commenter stated that until all animals born in Canada 
before the feed ban have been properly identified, as well as their 
offspring, the risk of importing one of these animals into the United 
States remains a risk that USDA has not adequately recognized. Other 
commenters also stated that there are likely additional undetected 
cases of BSE in Canada resulting from exposure to contaminated feed and 
that we should not relieve import restrictions at this time. One 
commenter stated that there are still breeding cattle alive in Canada 
that may have been exposed to the similar infectious material as the 
two BSE-positive cows identified in Alberta, Canada, and Washington 
State.
    Response: We disagree that the possible presence of additional 
animals in Canada, infected before implementation of the Canadian feed 
ban, present risks that have not been addressed for this rulemaking. As 
stated in responses to several other comments, it is possible that 
cattle born before Canada initiated its feed ban in August of 1997 may 
still exist in Canada. Because these cattle are now 7 years old or 
older, this rule will not allow them to be imported into the United 
States. Offspring of such cattle, which may be eligible for 
importation, are not likely to be infected with BSE. Although some 
evidence suggesting maternal transmission exists, such transmission has 
not been proven and, if it occurs at all, it occurs at very low levels 
not sufficient to sustain an epidemic (Ref 41). Canada has conducted 
extensive investigations of both of the two known BSE-infected animals 
in Canada and culled all of those animals' herdmates and offspring, all 
of which tested negative for BSE. Based on the low prevalence of BSE in 
Canadian cattle combined with the unlikely occurrence of maternal 
transmission, we concluded that cattle eligible for importation from 
Canada under this rule are highly unlikely to have BSE. Breeding cattle 
of any age may not be imported into the United States from Canada under 
this rule.
    Issue: One commenter stated that Canada has offered no scientific 
proof that it has either contained or eradicated BSE from its cattle 
herd, and that the two BSE-infected cattle detected were discovered 
despite a very limited testing program in effect in both the United 
States and Canada at the time.
    Response: We disagree. We believe Canada has established through 
import restrictions, a rigorous feed ban and ongoing surveillance that 
BSE is contained and that the necessary mitigation measures are in 
place to detect and prevent the dissemination of BSE infected material 
and eradicate the disease. Our rule is not predicated on eradication of 
BSE from a region. Canada meets our requirements for a minimal-risk 
region in part because the country has had an active, targeted 
surveillance program since 1992, and has exceeded OIE guidelines for 
BSE surveillance for more than the past 7 years. Additionally, as 
discussed above, Canada has significantly broadened that surveillance 
program.
    Issue: One commenter stated that, because BSE has a long latency 
period, it is not possible to know at present the exact disease status 
of Canada.
    Response: We concur that at present it is not possible to know with 
certainty whether any additional cows in Canada are infected with BSE. 
However, as documented in our risk analysis, we have concluded that the 
surveillance, prevention, and control measures implemented by Canada, 
in combination with the import restrictions imposed by this rule, will 
comprehensively mitigate the risk of introducing BSE into the United 
States through imported Canadian-origin animals and animal products.
Whether Existing Regulations Should be Maintained
    Issue: One commenter stated that APHIS has not demonstrated that 
the current regulations applicable to regions where BSE exists are not 
necessary in all cases. According to the commenter, the Harvard-
Tuskegee Study said import restrictions and the feed ban in the United 
States were the two most important reasons the United States was 
unlikely to have BSE. The commenter maintained that these regulations 
are essential now that BSE has ``crossed the Atlantic'' and pointed out 
that most

[[Page 516]]

countries that have reported a single case of BSE in a native animal 
have had additional cases either the following year or within the next 
several years. The commenter further stated that, according to the 
Harvard-Tuskegee Study, if BSE were introduced into the United States, 
it would be eliminated within 20 years, but only if the conditions 
affecting the spread of BSE remained unchanged for the 20 years 
following its introduction. The commenter maintained that time frame is 
not acceptable. The commenter stated that the regulations should not be 
relaxed without a comprehensive scientific evaluation of the 
implications of such relaxation. The commenter further recommended that 
APHIS immediately upgrade its present safeguards and restrictions for 
all imported beef and cattle and mobilize all its available resources 
to vigorously enforce these restrictions. One other commenter also 
noted the Harvard-Tuskegee Study's statement that the ban on the 
importation of live ruminants and ruminant MBM is the most effective 
measure for reducing the spread of BSE and maintained that USDA should 
``follow this recommendation from its own funded study.''
    Response: As discussed above, we have determined that it is 
appropriate, based on science, to use our standards for minimal-risk 
regions as a combined and integrated evaluation tool, focusing on the 
overall effectiveness of control mechanisms in place (e.g., 
surveillance, import controls, and a ban on the feeding of ruminant 
protein to ruminants).
    The commenters' paraphrasing of the Harvard-Tuskegee study is 
misleading. What the study actually said was, ``Measures in the U.S. 
that are most effective at reducing the spread of BSE include the ban 
on the import of live ruminants and ruminant MBM from the [United 
Kingdom] (since 1989) and all of Europe (since 1997) by USDA/APHIS, and 
the feed ban instituted by the Food and Drug Administration in 1997 to 
prevent recycling of potentially infectious cattle tissues.'' APHIS' 
restrictions on imports from regions listed in Sec.  94.18(a)(1) and 
(a)(2) are very restrictive and APHIS is not reducing those 
restrictions.
    As noted, since our proposed rule was published, FSIS and FDA have 
both strengthened their requirements concerning slaughter practices and 
food restrictions. The Harvard-Tuskegee Study's predictions that, if 
BSE entered the United States in as many as 10 cattle, few new cases of 
BSE would result and the disease would be eliminated within 20 years, 
at most, were based on the control measures existing in 2001. The 
Harvard-Tuskegee Study did not take into account recent regulatory 
changes concerning the use of rendered ruminant origin materials or 
active measures, such as culling and testing, that would be taken in 
response to an outbreak and for the purpose of eradication. If BSE were 
detected in a cow native to the United States, APHIS would work with 
other Federal agencies and State governments to eradicate preventable 
disease as quickly as possible. In combination with the recent changes 
in Federal regulations, we are confident that BSE would be eradicated 
in substantially less than 20 years.
    Regarding the possibility of additional cases being discovered in 
Canada, for reasons given in response to other comments on this issue, 
we would expect that number, if any, to be very low. This is based on 
the fact that Canada has had comprehensive BSE prevention and control 
measures in place for many years, and that the two animals found in 
2003 with BSE were older animals likely to have been exposed to 
contaminated feed before implementation of the feed ban.
Remove Import Restrictions
    Issue: Several commenters stated that, because BSE is considered a 
North American problem, the APHIS risk analysis and the proposed 
mitigation measures should be revisited, and restrictions on movement 
from Canada should be removed.
    Response: APHIS does not agree that the restrictions included in 
this rule should be removed. Based on our risk analysis, we consider 
these restrictions appropriate at this time to protect the United 
States from the introduction of BSE from minimal-risk regions such as 
Canada. BSE has been detected in two cows indigenous to Canada and, at 
this time, BSE has not been detected in any ruminant indigenous to the 
United States.
Other Comments Related to the Risk Basis for the Rule
    Issue: One commenter stated that APHIS has not properly analyzed 
the risk associated with Canada's inability to identify the source of 
the BSE case discovered on May 20, 2003. The commenter stated that, 
because the cow diagnosed with BSE in May 2003 could have consumed 
contaminated feed after the feed ban was in place and up to the age of 
3, and because Canada cannot definitively say that the cow's remains 
did not enter the ruminant feed chain, other Canadian cattle are likely 
to be infected. APHIS did not present the full range of risk 
possibilities associated with this scenario and, instead, presented 
only a best case scenario. Therefore, we should not relieve 
restrictions on imports.
    Response: The CFIA in May 2003 confirmed BSE in a cow from northern 
Alberta that was slaughtered in January 2003. In response, CFIA 
immediately started an exhaustive epidemiological investigation. U.S. 
representatives worked in conjunction with Canada during the 
investigation, the results of which are available on the CFIA Web site 
(Ref 13). The investigation considered a wide range of possible sources 
of infection, including two possible routes of MBM exposure, maternal 
transmission, exposure to chronic wasting disease via domestic or 
sylvatic cervids, exposure to scrapie, and the possibility that the 
infected animal may have originated in the United States. CFIA 
concluded, consistent with scientific knowledge from the United Kingdom 
and Europe, that the most likely source of BSE for the infected cow 
would have been the consumption of feed containing MBM of ruminant 
origin contaminated with the BSE prion before the United States and 
Canada implemented a feed ban in August 1997. CFIA also concluded that 
the original source of the BSE prion in MBM is likely to have been from 
a limited number of cattle imported directly into either Canada or the 
United States from the United Kingdom in the 1980s, before BSE was 
detected in that country.
    Proving the source of an infection is rarely easy, particularly 
when the infection occurred, as in this case, 6 or 7 years earlier. 
CFIA's epidemiological investigation was thorough and complete and its 
conclusions consistent with scientific knowledge about BSE and the 
facts associated with this case. CFIA did identify the source of the 
infection with as much certainty as is reasonable to expect. APHIS is 
confident that CFIA's conclusions are accurate.
    As discussed above, the epidemiological investigation additionally 
focused on rendered material or feed that could have been derived from 
the carcass of the infected cow. As part of that investigation, a 
survey was conducted of approximately 1,800 sites that were at some 
risk of having received such rendered material or feed. The survey 
suggested that 99 percent of the sites surveyed experienced either no 
exposure of cattle to the feed (96 percent of the sites) or only 
incidental exposure (3 percent of the sites). The remaining 1 percent 
represented limited exposures, such as cattle breaking into feed piles, 
sheep

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reaching through a fence to access feed, and a goat with possible 
access to a feed bag. Depopulation of Canadian herds possibly exposed 
to the feed in question was carried out by the Canadian Government. 
Canadian officials conducted a wide-ranging investigation of possible 
exposure to the feed in question and carried out depopulation of 
Canadian herds possibly exposed to the feed. On each of those farms 
where the investigation could not rule out the possibility of exposure 
to feed that may have contained rendered protein from the infected 
animal, the herds were slaughtered and tested. All of those animals 
tested negative for BSE and their carcasses were disposed of in ways, 
such as disposal in landfills, to ensure that they did not go into the 
animal food chain.
    Issue: One commenter, in light of the detection of two BSE-positive 
cows of Canadian origin, criticized the Canadian risk assessment for 
having concluded that ``993 times out of a thousand, there would be no 
BSE infection in Canada as the result of importation of cattle from the 
UK and Europe from 1979 to 1997.''
    Response: Canada's risk assessment concluded that there is a very 
small probability that BSE was introduced into Canada as a result of 
the importation of cattle from the United Kingdom or elsewhere in 
Europe from 1979 to 1997. The estimated probability of at least one 
infection of BSE occurring before 1997 was 7.3 x 10 -3 or, 
as the commenter noted, that 993 times out of a thousand, there would 
be no BSE infection in Canada as the result of importation of cattle 
from the UK and Europe from 1979 to 1997'' (Ref 12). However, the 
Canadian risk assessment did not conclude that no infected animal would 
ever be found. Both Canada and the United States have conducted 
aggressive surveillance for BSE designed to detect the disease should 
it exist in our cattle populations. Other controls are in place to 
ensure that the disease does not spread and amplify in the cattle 
populations or result in human exposure.
    Issue: One commenter stated that the United States has a zero 
tolerance policy for fecal, ingesta, or milk contamination on livestock 
carcasses or meat products. The commenter said that these contaminants 
can result in diseases that are treatable, even though they may cause 
severe illness and death, but stated that BSE causes a disease in 
humans that invariably causes death and asked why we could find an 
acceptable risk for BSE, which is always terminal, when we have zero 
tolerance for contaminants, which may cause diseases which are 
treatable.
    Response: The comment suggests an inconsistency that is not 
present. The policy of zero tolerance is consistent for adulterants 
whether the adulterant is E. coli O157:H7 or the BSE agent. Under FMIA, 
a meat food product is adulterated if, among other circumstances, it 
bears or contains any poisonous or deleterious substance that may 
render it injurious to health (21 U.S.C. 601 (m)(3)). FMIA requires 
that FSIS inspect the carcasses, parts of carcasses, and meat food 
products of amenable species to ensure that such articles are not 
adulterated (21 U.S.C. 604, 606). FMIA gives FSIS broad authority to 
promulgate such rules and regulations as are necessary to carry out the 
provision of the Act (21 U.S.C. 621).
    FSIS recognizes the agent that causes BSE as an adulterant under 
FMIA (Ref 42). The infective agent that causes BSE, however, is not 
fully characterized or easily identified. USDA's Agricultural Research 
Service is currently conducting research to further characterize the 
agent that causes BSE. Pathogenesis studies have confirmed that certain 
tissues of cattle (i.e., the brain, skull, eyes, trigeminal ganglia, 
spinal cord, vertebral column--excluding the vertebrae of the tail, the 
transverse processes of the thoracic and lumbar vertebrae, and the 
wings of the sacrum, and dorsal root ganglia of cattle 30 months of age 
and older, and the tonsils and distal ileum of all cattle) are 
predisposed to harboring the infective agent that leads to BSE. FSIS, 
as part of its January 12, 2004, rulemaking, designated these tissues 
as SRMs, declaring that they are inedible, and prohibited their use for 
human food. For these BSE rules, FSIS also used the adulteration 
provision, which relies upon the determination that certain cattle and 
parts are unfit for human food because of the uncertainty associated 
with onset of the disease and the value of the testing results.
    E. coli O157:H7 is well characterized and recognized by industry as 
associated with fecal contamination that is transferred from hide or 
digestive tract onto carcass during dehiding. As a result, industry 
recognizes that sanitary dressing is a critical step in the production 
of safe beef, particularly regarding E. coli O157:H7. In contrast, the 
infective agent for BSE cannot be easily identified and removed in the 
same way as fecal content. As a result, FSIS has a zero tolerance for 
SRMs (i.e., any evidence that SRMs were not properly controlled as 
inedible will result in the product being considered as adulterated) 
that scientific studies confirmed as associated with the BSE agent. 
Furthermore, FSIS excludes non-ambulatory cattle from the human food 
supply because European surveillance data have shown a higher incidence 
of BSE in non-ambulatory disabled cattle than in healthy slaughter 
cattle. Therefore, the inconsistency in tolerance suggested by the 
commenter does not exist.
    The FMIA requires that FSIS inspect the carcasses, parts of 
carcasses, and meat food product of all cattle, sheep, swine, goats, 
horses, mules, or other equines that are capable for use as human food 
to ensure that such articles are not adulterated (21 U.S.C. 604, 606). 
If the carcasses, parts of carcasses, and meat food products are found, 
upon inspection, to be not adulterated, FSIS marks them as ``Inspected 
and passed'' (21 U.S.C. 604, 606, 607).

F. Economic Analysis for the Rulemaking

    In accordance with Executive Order 12866 and the Regulatory 
Flexibility Act, we assessed the potential economic costs and benefits 
of our November 2003 proposed rule and its potential effects on small 
entities. We included a summary of our economic analysis in the 
proposed rule and indicated how the public could obtain a copy of the 
full economic analysis.
    A number of commenters addressed the potential economic effects of 
the proposed rule. Some of the comments focused on the rule in general 
or specific provisions of the rule, while others addressed our analysis 
of the potential economic effects of the rule. We discuss below each of 
the issues raised by commenters. Because some of the comments were 
technical in nature, we have tried to use the commenters' wording where 
practicable. Therefore, the manner in which we characterize each of the 
issues reflects the commenters' viewpoint.
    The issues are grouped into eight sections:
     Economic modeling;
     Prices and quantities;
     Social welfare changes;
     Consumer demand;
     Feeder animal movement and feedlot requirements;
     U.S. beef exports;
     Effects on small entities; and
     Other.
1. Economic Modeling
    Issue: The APHIS economic analysis of the potential impact of the 
proposed rule falls short of estimating the larger economic impacts 
this rule could have on the U.S. economy. It provides only a limited 
analysis of the effect of imports of Canadian cattle and beef on prices 
in the United States and ignores

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the impacts this rule will have on associated industries and their 
productive output, as well as on employment.
    Response: The commenter provides his own analysis of impacts, using 
multipliers to demonstrate economy-wide effects. (Multipliers measure 
total change throughout the economy resulting from one unit change for 
a given sector.) Effects can be described as direct, indirect, or 
induced. Direct effects represent the initial change in the industry in 
question. Indirect effects are changes in inter-industry transactions 
as supplying industries respond to increased demands from the directly 
affected industries. Induced effects reflect changes in local spending 
that result from income changes in the directly and indirectly affected 
industry sectors (Ref 43).
    We acknowledge that the rule will have effects that reach beyond 
the cattle producing and processing sectors. However, the analysis 
presented by the commenter estimates only the negative impacts to the 
wider economy while ignoring the positive impacts. The commenter 
calculates that a reduction in U.S.-supplied feeder cattle of 283,182 
head reduces sales by $181.2 million and causes a $701.2 million loss 
to the economy, assuming a multiplier of 3.87. However, the analysis 
for the proposed rule also showed an increase in the total number of 
feeder cattle fed in the United States of 221,318 head. When valued at 
$938 per head, the resulting additional fed cattle generate $207.6 
million in additional sales for U.S. feedlot operators. Applying the 
commenter's choice of a 3.87 multiplier yields an economic gain of 
$803.4 million from feeding these additional feeder cattle. The result 
is a net gain to the U.S. economy of $102.2 million for importing the 
504,500 feeder cattle from Canada. The same type of analysis would also 
apply to slaughter cattle and carcass beef.
    However, the multipliers the commenter chose for his analysis are 
Type II, which include direct, indirect, and induced effects. We 
consider the use of Type I multipliers (only the direct and indirect 
effects) more appropriate for the calculation of impacts of changes in 
cattle supplies as well as changes in exports. Income loss and reduced 
consumer spending that might occur in one part of the cattle industry 
due to this rule need to be balanced against the growth in income and 
spending that can be expected to occur in other parts of the industry. 
In recognition of the commenter's observation that the rule will have 
impacts on associated industries, we include in the analysis for this 
final rule a multi-sector model of feed inputs, animal production, and 
animal product processing for a number of agricultural sub-sectors 
besides cattle and beef. Using this model, we estimate effects of 
reestablished imports from Canada in terms of changes in gross revenue. 
For the cattle sector, gross revenues are simulated to decline in 2005 
by between 3.85 percent and 4.81 percent and for the beef processing 
sector, by between 1.26 percent and 1.59 percent. This model does not 
provide measures of change in welfare for the United States because of 
the rule; however, welfare changes would be smaller than the change in 
gross revenue identified by the model.
    Issue: The decrease in the quantity of cattle supplied by the 
United States is a longer-term effect than the analysis suggests. 
Because the calf-crop that will produce beef in 2005 has already been 
conceived, this reduction will not occur until at least 2006. If the 
decrease in quantities supplied by U.S. entities is a short-term 
consequence (such as cattle held on feed for longer periods), then the 
longer-term price impact of holding supplies should be calculated.
    Response: The model used to estimate effects of the proposed rule 
did not specify the period of time over which U.S. cattle producers 
would reduce herd size in response to price declines following 
resumption of imports from Canada. We expect that the resumption of 
cattle imports from Canada will have effects both in the near term 
(adjustment of the length of time animals are fed) and longer term 
(adjustment of calf retention and breeding decisions). We acknowledge 
that the comparative statics model abstracts from the problem of what 
becomes of the cattle that are already in the system, ready to be 
marketed in the near term; however, we believe the net benefits 
identified by the model are robust to this abstraction.
    Holding cattle longer on feed depends mainly on feed prices 
relative to expected slaughter prices. Favorable forage conditions are 
expected to result in more cattle being placed on winter pasture and 
then moved to feedlots after the grazing season ends. Record-high 
feeder cattle prices in the United States will continue to pull more 
heifers into the feedlots than are retained for breeding. Effects 
described by the analysis should be viewed as including both near-term 
and longer-term effects.
    Issue: Calculating results on a weekly rather than an annual basis 
allows the ``surge effect'' to be more clearly reflected. Annual 
averages smooth the price impacts. Weekly surges have been shown to 
exhibit a powerful effect, both fundamentally and psychologically on 
cattle and beef markets.
    Response: The commenter's reference to surge effects concerns 
weekly price swings that can affect cattle and beef markets. While we 
understand that market disruptions can occur within a short time 
period, we are unable to model expected impacts of the rule on a weekly 
basis, as we are unaware of any data with sufficient depth and 
precision to model weekly effects. Annual data used in the analysis of 
welfare impacts generally capture the very short-term market events 
that may occur, even if they are not described in detail. In the 
analysis for this final rule, price effects are estimated over the one 
or two quarters that the backlog of Canadian fed and feeder cattle are 
expected to be imported.
    Issue: The entire model is heavily dependent on elasticities 
calculated in 1996. The current situation in U.S. beef supply and 
demand is very different from that year's; there have been shifts in 
demand since 1996.
    Response: The elasticities used in the analysis for this final rule 
have been revised from those used for the proposed rule. The revised 
elasticities are provided by USDA Economic Research Service, based on 
historical price and quantity data. The price elasticities of supply 
and demand, respectively, are 0.61 and -0.76 for fed cattle, 0.40 and -
0.89 for feeder cattle, and 0.84 and -0.80 for wholesale beef. For 
comparison in our consideration of near-term price effects during 
importation of the cattle backlog in the analysis for the final rule, 
we calculate the results using supply and demand elasticities reduced 
by one-half. Buyers and suppliers of cattle can reasonably be expected 
to be less responsive to price changes in one or two quarters than over 
a year.
2. Prices and Quantities
    Issue: In its economic analysis, APHIS estimated that reestablished 
slaughter cattle imports from Canada of 840,000 head would result in a 
price decline for such animals of $1.30 per cwt. With regard to feeder 
cattle, APHIS estimated that reestablished feeder cattle imports from 
Canada totaling 504,500 head would result in a price decline of 72 
cents per cwt. However, if you affect the price of a 1,200-pound 
finished steer by $1.70 per cwt, then you have to change the price of 
an 800-pound feeder steer by more than 80 cents per cwt.
    Response: The commenter apparently confused the $1.30 per cwt drop 
in price with the percentage decline it represents, i.e., 1.7 percent. 
In the economic analysis for this final rule, we

[[Page 519]]

find the decline in prices for fed cattle in 2005 to range from $1.95 
to $2.72 per cwt. For feeder cattle, the decline in prices ranges from 
$0.61 to $1.22 per cwt.
    Issue: With constant demand, if you increase supply by 1 percent, 
you affect the price by 3 to 5 percent. Before the May 2003 ban on 
ruminant imports into the United States, Canada shipped about 3 percent 
of its cattle to the United States, both feeder and finished. 
Accordingly, with finished cattle bringing about $100 per cwt, the 
estimated effect on the U.S. market should be at least $9 per cwt.
    Response: The commenter describes a change that graphically can be 
portrayed as movement to a lower price on a vertical (constant) demand 
curve, due to an outward supply shift. In reference to the percentage 
of cattle shipped from Canada, we believe the commenter did not mean to 
write ``3 percent of their cattle,'' but rather 3 percent of cattle 
marketed in the United States. With this change and a fixed demand, the 
percentages set forth by the commenter would lead as stated to at least 
a $9 per cwt drop in price.
    However, this projected price decline is too large for several 
reasons. While demand for feeder and finished cattle is inelastic, it 
is not perfectly inelastic. Demand will increase as price falls, 
moderating the price decline. The own price elasticities of demand 
(percentage change in demand for a given percentage change in price) 
used in the analysis for this final rule are -0.89 for feeder cattle 
and -0.76 for fed cattle. These are considered short-run elasticities. 
In addition, the increase in overall supply will be less than the 
number of cattle imported from Canada. The imports will partly result 
in an increase in the total supply of cattle sold in the United States, 
but also partly displace U.S.-produced cattle. Lastly, while the 
percentages and prices used by the commenter are not specific, 
inaccuracies do spuriously contribute to the commenter's conclusion. 
Cattle under 30 months of age imported from Canada in 2002 comprised 
about 2 percent of the U.S. market for such animals, not 3 percent. 
Annual 2005 prices forecasted in November 2004 for choice steers 
(Nebraska, Direct, 1100-1300 lbs), according to USDA World Agricultural 
Supply and Demand Estimates, range from $82 to $88 per cwt, not $100 
per cwt.
    Issue: With the loss of other foreign markets for Canadian beef, 
Canada will probably send more cattle to the United States.
    Response: We agree that because of the closure of foreign markets 
for Canadian beef, there are additional cattle in Canada that are 
likely to be shipped to the United States with the resumption of 
imports. This backlog of Canadian cattle is included in the analysis 
for this final rule.
    Issue: A thorough analysis detailing the entire scale of impacts on 
exports due to the proposed rule is warranted. For example, the 
economic analysis shows the proposed price effect of importing 840,800 
slaughter cattle from Canada. It indicates an increase in the number 
slaughtered in the United States of only 66,350 and a decrease in the 
number supplied by the United States of 474,450, yielding a price 
decrease of $1.30 per cwt. What calculations were used to arrive at 
these numbers?
    Response: Impacts on U.S. exports were addressed in the economic 
analysis for the proposed rule by considering a range for possible 
foreign market losses if importing countries do not agree with the U.S. 
categorization of Canada as a BSE minimal-risk region. Reestablished 
imports from Canada of 840,800 head of slaughter cattle were estimated 
to result in an increase of 366,350 head in the total number of cattle 
slaughtered and displacement of 474,450 head that would have been 
supplied by U.S. entities. These calculations are based on the partial 
equilibrium model referenced in footnote 4 of the economic analysis, 
and a price-quantity baseline as shown in table 2 of the analysis. The 
same model, but with more current baseline data and estimates on 
expected cattle imports from Canada, is used in the analysis for this 
final rule.
    Issue: The calculation used to determine the annual number of 
feeder cattle fed at U.S. feedlots assumes inventory turnover of three 
times per year, an average of 120 days on feed. This assumes that all 
feedlots are 100 percent full each day of the year. Due to seasonal 
supply shortages (e.g., there were 11 percent less cattle on feed 
during the third quarter of 2003 than the first quarter of that year) 
and an average of 150 days on feed, industry turnover averages are much 
closer to 2.5 times per year. Using 2.5 inventory turns per year, the 
number of feeder cattle fed in U.S. feedlots becomes 27,273,750 head 
per year. This is 5,454,750 head (17 percent) less than the 32,728,500 
calculated using three inventory turns per year. An overstated 
inventory number understates the price impact related to resumption of 
cattle imports.
    Response: We concur that we may have used too large a number of 
inventory turns per year in calculating the number of feeder cattle fed 
at U.S. feedlots. The baseline number of feeder cattle marketed in 
2005, for feedlots with capacities greater than 1,000 head, is assumed 
to be 22,125,000 head, as provided by the USDA Office of the Chief 
Economist.
    Issue: The baseline slaughter cattle information table uses a 
slaughter cattle price of $78.16 per cwt, the average price of choice 
steers for the first two quarters of 2003. The market has been over 
$100 per cwt this fall [the fall of 2003] and Cattle-Fax [a member-
owned information organization serving producers in all segments of the 
cattle industry] forecasts a price of $87 per cwt for the second 
quarter of 2004. Due to the non-typical price structure that is 
forecast well into 2004, the price of $78.16 per cwt clearly translates 
into understated market damages.
    Response: In the analysis for this final rule, we use a price range 
for fed cattle of $82 to $88 per cwt, based on the annual forecast for 
2005, as of November 2004 (USDA World Agricultural Supply and Demand 
Estimates). This price range takes into consideration continued high 
U.S. demand for beef and present restrictions on U.S. beef exports.
    Issue: If the scenarios described in the proposed rule regarding 
the potential loss of export markets assume an eventual recovery of 
these lost markets, costs need to be estimated representing recovery 
efforts. If the assumption is a terminal loss of markets, then a long-
term accumulated loss value should be estimated and reported.
    Response: We do not assume a permanent loss of export markets. 
Since publication of the proposed rule, many countries have established 
restrictions on U.S. cattle and beef due to the Washington State BSE 
discovery. It is not clear to us what is meant by ``recovery efforts,'' 
but we believe it is likely the commenter is referring to negotiations 
between the United States and its trading partners for the resumption 
of cattle and beef imports from the United States. In the analysis for 
this final rule, we consider how the rule may influence these 
countries' future decisions with respect to the lifting of the import 
restrictions.
    Issue: The cost/benefit analysis of the proposed rule shows little 
if any benefit and underestimated cost to U.S. producers, feeders and 
packers. It should also be noted that the benefits are limited, as the 
December prices of Alberta feeder cattle were 10 to 18 percent higher 
than those of December 2002 and the prices of Alberta slaughter cattle 
were 7 to 9 percent higher than those of December 2002.
    Response: The analysis for the proposed rule estimated price 
declines

[[Page 520]]

for feeder and fed cattle, given a resumption of imports from Canada. 
As a group, U.S. entities in competition with firms exporting the 
Canadian cattle can be expected to experience reduced earnings. They 
will sell fewer cattle at lower average prices. Entities buying feeder 
and fed cattle at lower average prices due to the increased supply from 
Canada can be expected to experience increased earnings. Quantities of 
cattle assumed to be imported from Canada are based on the backlog that 
has built up because of current restrictions and on historic import 
levels. Once the backlog has cleared in 2005, prices for feeder and fed 
cattle in Canada relative to prices in the United States will influence 
the number of Canadian cattle sold in the United States and, therefore, 
the ultimate price effects as well.
    Issue: With the December 2003 BSE discovery in Washington State, we 
have a very clear example of negative price impact from losing our 
export markets. The only export market currently closed that we 
estimate would remain open under the least favorable reaction to the 
APHIS proposal is Mexico. The January Live Cattle contract fell from 
$90.80 per cwt to $73.50 per cwt, or approximately 19 percent. This 
negative price impact has not only deflated fed-cattle prices, but is 
also discounting feeder cattle and calf prices. Every animal 
slaughtered will take discounts each time it is sold, resulting in 
heavy cumulative discounts. The APHIS proposal shows potential losses 
from a 32 percent reduction in beef exports (approximately Japan's 
portion) to range from $1.65 to $1.93 per cwt on a live weight basis. 
Another very clear example of the significance of Japan as an export 
market is demonstrated by the loss of 44 percent of the volume of beef 
and beef variety meat exports to Japan in 2001-2002 due to the 
discovery of BSE in Japan. Industry economists estimated the sharp 
decline in exports to Japan negatively impacts fed cattle prices in the 
United States by $2.50 per cwt to as much as $4.00 per cwt. Nor was the 
impact confined to the beef industry--shockwaves rippled through the 
grain and oilseed sectors, as well as the shipping industry. It is 
important to realize that this impact was felt from only a 44 percent 
loss of the Japan market * * *[I]t took nine months to make significant 
progress and full recovery had not occurred in the trade sector after 
one year. Determining the actual price impact of lost export markets 
appears much more amplified than the APHIS proposal suggests.
    Response: Although prices for cattle did decline sharply 
immediately following the Washington State BSE discovery in December 
2003, they quickly rebounded. Forecasted annual 2005 prices for feeder 
cattle, as of October 2004, are $94 to $100 per cwt. This is one of the 
baseline price ranges used in the analysis for this final rule. Beef 
prices are also forecasted to remain high despite export restrictions. 
A wholesale light Choice boxed beef price for 2005 of $141 to $147 per 
cwt is used in the analysis. In the discussion of possible effects of 
this rule on U.S. exports, we acknowledge the premium earnings foregone 
due to closed foreign markets.
    Issue: The economic analysis assumes a scenario where U.S. markets 
are unaffected with BSE--a scenario that is no longer true. In 
addition, it accepts as justification, in part, for the economic risks, 
the high prices received by cattle producers and feeders in recent 
months. However, if you adjust dollars for inflation, producers 
received less for cattle than they did 40 years earlier.
    Response: The analysis for this final rule takes into consideration 
existing conditions for the U.S. cattle and beef markets. Today's 
cattle prices, adjusted for inflation, may well be lower than 40 years 
ago, but this fact is not pertinent in considering expected benefits 
and costs of the rule.
    Issue: Annual imports of beef into the United States rose from 3.6 
billion pounds in 1995 to 5.5 billion pounds in 2000. In addition, 
other factors, such as the declining share of the retail dollar passed 
on to U.S. producers, have already injured the U.S. cattle industry. To 
open the border will accentuate this problem. Opening the border to 
live cattle imports combined with Canadian beef imports will result in 
supplies being increased by 9 percent and will result in an 18 to 20 
percent decline in prices. When the Canadian border was opened to beef 
imports into the United States, our cattle prices declined 20 percent.
    Response: The economic analysis performed for the proposed rule did 
not indicate the cattle and beef increases suggested by the commenter. 
The analysis showed that with resumption of imports from Canada, the 
number of fed cattle may increase by about 3 percent, the number of 
feeder cattle by less than 2 percent, and beef supplies by less than 1 
percent (given ongoing boneless beef imports). We expect a decline in 
prices due to these increased supplies, but not an 18 percent to 20 
percent decline. With the resumption of beef imports from Canada in 
2003, there was an increase in cattle prices (choice steers, Nebraska, 
1100-1300 lbs) from $78.49 per cwt in the second quarter, to $83.07 per 
cwt in the third quarter, to $99.38 per cwt in the fourth quarter (USDA 
World Agricultural Supply and Demand Estimates). The analysis for this 
final rule indicates a decline in cattle prices for 2005 of roughly 
between 0.63 percent and 3.2 percent due to reestablishment of imports 
from Canada, depending on the category of cattle frame and underlying 
import assumptions.
    Issue: The beef analysis for the proposed rule used two different 
baseline prices for beef, $3.00 and $3.50 per pound. It should be noted 
that these values for beef may be low. USDA's Economic Research Service 
(ERS) quotes beef prices at $4.32 per pound in November 2003, a record 
high.
    Response: In the economic analysis for the proposed rule, we noted 
that $3.00 and $3.50 per pound were used as baseline prices to take 
into consideration affected beef products lower in value than choice 
cuts. In the analysis for this final rule, we use a wholesale beef 
price range of $141 to $147 per cwt (light Choice boxed beef), a 
forecasted annual 2005 price provided by USDA Economic Research 
Service.
3. Social Welfare Changes
    Issue: Despite APHIS' assertions that price decreases associated 
with the renewal of trade of feeder and slaughter cattle with Canada 
would not significantly affect buyers or sellers of slaughter cattle, 
APHIS must recognize that these costs would be borne entirely by 
relatively few small businesses, whereas the consumer surplus (in the 
form of reduced beef prices) would be spread out among millions of 
consumers.
    Response: We acknowledge that consumers who benefit from the 
expected price decreases will outnumber U.S. livestock producers and 
other entities harmed by the same price decreases. The economic 
analysis indicates that the net change in welfare due to these impacts 
within the United States will be positive.
    Issue: Three scenarios in the analysis for the proposed rule are 
used to evaluate reestablished cattle and beef imports from Canada, 
assuming (1) no loss, (2) 32 percent loss, and (3) 64 percent of U.S. 
beef export markets. Based on the APHIS analysis, producers and feeders 
lose under all three scenarios. Packers gain only if export markets are 
maintained while live cattle imports resume. Benefits to retailers/
consumers are positive under each assumption. The only net benefit 
scenario for all sectors occurs if live cattle imports resume and 
export markets are maintained.

[[Page 521]]

    Response: The commenter is correct in concluding that the economic 
analysis for the proposed rule indicated that loss of export markets 
due to the rule could result in an overall negative impact for the 
United States. The analysis was clear in stating that we do not know 
how other countries would react to reestablished imports from Canada. 
Since publication of the proposed rule, many countries have established 
import restrictions on U.S. cattle and beef because of the Washington 
State BSE discovery. In the analysis for this final rule, we consider 
how the rule may influence these countries' future decisions with 
respect to lifting of the import restrictions. Possible trade effects 
of the rule cannot be discussed with the same confidence as expected 
domestic impacts.
    Issue: APHIS' use of ``consumer surplus'' is theoretically 
questionable. By making a direct offset between the ``consumer 
surplus'' of public and the ``producer surplus'' of the industry, APHIS 
assumes that these surpluses are both measurable and comparable between 
producers and consumers. The concentration of the negative impacts on a 
relatively small number of industry participants and the wide diffusion 
of benefits across millions of consumers suggests that the true impact 
is much more negative than the analysis suggests.
    Response: Benefit-cost analysis, the approach used for analyzing 
Federal regulations, determines whether benefits to society as a whole 
outweigh costs to society as a whole. Costs and benefits are not borne 
equally by all groups in a society. When measured in monetary units, 
comparing changes in consumer and producer surplus is well within 
standard economic theory, regardless of whether the number of entities 
differs across producers and consumers. This standard application of 
economic theory, moreover, is recommended in OMB guidance (Ref 44).
    Issue: An impact that is particularly germane is that of other 
countries shutting their borders to U.S. exports based on the proposed 
rule. Although this has been addressed in the analysis, it depends upon 
increased ``consumer surplus'' to offer generous offsets to the 
crippling losses on the beef industry.
    Response: APHIS' economic analysis for the proposed rule found that 
the net effect of the resumption of cattle imports from Canada would be 
positive for both feeder cattle and slaughter cattle--that is, the 
action would benefit U.S. buyers more than it would harm U.S. sellers. 
The analysis for this final rule also shows net positive effects. This 
is not surprising, as it is a standard result of microeconomic theory 
that opening a formerly restricted market benefits consumers in that 
market more than it hurts producers participating in the market when it 
was closed. Prior to the Washington State BSE discovery, exports of 
U.S. beef and ruminant products were earning 7.5 billion annually. 
Immediately afer the discovery, these export earnings fell by 64 
percent. As of November 2004, the export decline had been reduced to 41 
percent of pre-BSE levels. (Source: USDA Transcript, Release No. 
0497.04, November 9, 2003.)
    Issue: Serious concerns exist about the analytical framework that 
finds offsets for every producer loss as a gain in consumer surplus.
    Response: We disagree. It is a standard result of microeconomic 
theory that expanding the supply in a formerly restricted market causes 
both an increase in consumer surplus and a decrease in producer surplus 
among producers participating in the market before it was opened. The 
analysis would cause more concern if this were not the case.
    Issue: In its economic analysis for the proposed rule, APHIS' 
states that estimated price declines for producers/suppliers and 
consumers/buyers of slaughter cattle, feeder cattle, and beef due to 
allowing imports of live cattle from Canada would largely reflect a 
return to the more normal market conditions that prevailed before 
Canada's BSE discovery. APHIS' economic analysis states that these 
``more normal'' market conditions would come at an annual decrease of 
$448.7 million for sellers of cattle. APHIS' analysis also claims a 
``net benefit'' from reopening the border that presumably is based on 
consumers' savings through lower beef prices. APHIS needs to reevaluate 
its economic analysis in light of the current situation and in light of 
other trends in the beef industry, taking into account the economic 
situation of cattle farmers and ranchers.
    Response: APHIS used the phrase ``more normal market conditions'' 
in reference to our nation's long history of trade with Canada in 
cattle and beef and has omitted this wording in the analysis for the 
final rule to avoid any misunderstanding. The net benefits estimated in 
the analysis result from the gains for consumers and other purchasing 
entities (due to the price declines) exceeding the losses for producers 
and other parties whose products will compete with the imports from 
Canada.
    Issue: Do normal conditions suggest livestock values that reflect 
negative margins for U.S. producers? If so, that is science that must 
be considered in the rule, because producers operating at a loss are 
less able to invest in disease prevention, surveillance, and response.
    Response: The rule is expected to result in price declines, but 
such declines do not equate to negative margins for U.S. producers. 
Clearly, those producers with smallest net revenues will be the most 
affected. Given current prices, it is not expected that the rule will 
cause producers to reduce their investments in disease prevention, 
surveillance, and response.
    Issue: The APHIS analysis shows no benefit to the U.S. live cattle 
industry or consumers for assuming greater risk. How will reopening the 
border benefit consumers? How will reopening the border benefit 
producers?
    Response: The economic analysis for the proposed rule showed that 
beef consumers could be expected to benefit due to lower prices. 
Producers, if in competition with fed and feeder cattle that would be 
imported from Canada, are not expected to benefit because of the 
reestablished imports. However, owners of slaughter facilities, for 
example, are expected to benefit because of the additional supply of 
fed cattle. The analysis showed that gains to consumers would exceed 
losses to producers, for a net gain overall. These same conclusions are 
reached in the analysis for this final rule.
    Issue: Since the United States closed its border to the importation 
of Canadian cattle under 30 months of age, the beef processing industry 
in Weld County, Colorado, which is the largest contributor to the local 
economy there, has been experiencing significant financial losses and 
is at risk of losing the entire beef industry in that area. The risk 
from the importation of beef, with its limited inspections, far exceeds 
the potential problems associated with importation of live cattle from 
Canada.
    Response: As shown in the economic analysis for the proposed rule, 
buyers of feeder cattle can be expected to benefit from resumption of 
imports from Canada. Communities such as that identified by the 
commenter that are dependent on processing industries will gain from 
the reestablished trade. Removal of SRMs at slaughter and other 
required risk-mitigating measures of this rule will ensure that beef 
entering the United States from Canada satisfies animal health criteria 
the same as or equivalent to those required in the United States.
    Issue: In the analysis for the proposed rule, expected effects of 
the rule on the

[[Page 522]]

fed and feeder cattle markets were examined in separate scenarios. The 
results of these two scenarios indicate that when fed cattle imports 
are resumed, producers' surplus declines by $448 million. When feeder 
cattle imports are resumed, producers' surplus declines by $182 
million. APHIS concludes that these impacts would be independent and 
that increased imports of feeder cattle would benefit feedlot owners. 
Lower prices for feeder cattle are more likely, however, to pass 
through the market channel to consumers, and feedlot producers are not 
likely to realize significant benefits from the lower prices for feeder 
cattle. This suggests that the impacts of these events [reestablished 
fed cattle and feeder cattle imports from Canada] would be additive, 
implying that opening the border to trade with Canada on fed cattle and 
feeder cattle would likely have an effect of more than $630 million.
    Response: Benefits from lower prices for feeder cattle and fed 
cattle may be at least partially realized by entities further down the 
marketing chain, including consumers. Revenue margins for feedlot 
operators may be characterized by greater rigidity than is implied in 
the analysis for the proposed rule. This possibility is acknowledged in 
the analysis for this final rule. Impacts described from reestablishing 
fed and feeder cattle imports from Canada would be additive. Their 
addition does not negate the fact that expected benefits outweigh 
expected costs of resumption of imports.
4. Consumer Demand
    Issue: A significant negative reaction by importing countries 
regarding the safety of Canadian beef may very well translate into a 
U.S. consumer backlash should U.S. beef and beef products be perceived 
as unsafe. What are the long-term costs and implications of domestic 
market share loss to other protein sources?
    Response: According to Cattle-Fax, U.S. domestic beef sales and 
demand remained strong after the discovery of a single cow diagnosed 
with BSE in the state of Washington. Three months after Canada 
announced a case of BSE, limited trade resumed with the United States, 
and imports of Canadian boneless meat from animals less than 30 months 
of age at slaughter began entering the United States. There has been no 
evidence that domestic consumers substituted other protein sources due 
to either the BSE discovery in Washington State, or in response to 
resumed imports of Canadian boneless meat. There is no indication that 
domestic consumers had a negative reaction to resumed imports of 
Canadian boneless meat. Rather, all market reports indicate that 
consumer demand for beef remains strong, even in light of over 70 
countries imposing import bans on U.S. cattle and beef products in 
response to the BSE case in Washington. In fact, the National 
Cattleman's Beef Association, along with the Cattlemen's Beef Board, 
administered checkoff surveys of U.S. consumers in January 2004 that 
indicated that 97 percent of consumers were aware of BSE and a record 
89 percent were confident in the safety of domestic beef on the market. 
That confidence level increased to 91 percent in February surveys. 
Because there were no discernible losses in consumer confidence or 
demand for domestic beef, and likewise no domestic market share loss to 
other protein sources in response to a single case of BSE in Washington 
State or in response to resumed imports of Canadian boneless meat, we 
would not expect this climate to change in light of increased imports 
of associated Canadian commodities.
    Issue: Even if U.S. practices are adequate to avoid amplification 
of BSE after it is imported in Canadian animals, it is clearly wrong to 
assume, as APHIS does, that a limited number of U.S. cases associated 
with Canadian-born animals will not materially injure the U.S. industry 
and consuming public. The fallout over the Washington State BSE case 
has shown that quite clearly. Cattle prices are dropping on the basis 
of a single Canadian-born cow slaughtered in the United States. The 
loss of economic confidence in the beef supply has clear negative 
impacts on producer revenue. In APHIS' analytical approach, it should 
also have clear negative impacts on ``consumer surplus,'' since the 
downward shifting of the demand curve reflects the reduced potential 
for enjoyment of beef by a shaken public. Assurances--such as we had in 
December of 2003--of overall safety of the U.S. beef supply will help 
mitigate this impact. However, the economic impacts are large even if 
``it is highly unlikely that such an introduction would pose a major 
animal health or public health threat.''
    Response: U.S. beef consumers have not reduced beef consumption 
since the discovery of BSE in an imported cow in the United States, nor 
are there indications of a long-term impact of the discovery on the 
domestic demand for beef. Following the BSE discovery in Washington 
State in December 2003, a sudden price decline was short-lived. Prices 
today have largely recovered, with the projected 2004 price range for 
choice steers (Nebraska, 1100-1300 lbs) ranging from $84 to $88 per 
cwt, compared to prices of $67.04 and $84.69 for 2002 and 2003, 
respectively (USDA World Agricultural Supply and Demand Estimates). 
U.S. cattle and beef markets since the single BSE occurrence in 
Washington State have, if anything, reflected the strength and 
resilience of these industries and the high level of confidence 
consumers hold with respect to the health and safety of U.S. cattle and 
beef. We do not expect the rule to result in an increase in risk of BSE 
in the United States. Removal of SRMs at slaughter and other risk-
mitigating measures of the rule will ensure that beef entering from 
Canada satisfies animal health criteria that are the same as or 
equivalent to those required in the United States.
    Issue: The most serious problem with the economic analysis for the 
proposed rule is the failure to take seriously the costs to both the 
producer and the consumer as a result of loss in confidence associated 
with even a very limited incidence of BSE in the United States.
    Response: Consumer confidence is an issue of concern for APHIS; 
however U.S. consumers do not appear to have reacted to the case of BSE 
reported in Washington State in a way that demonstrates profound loss 
of confidence. There were short-term price effects in U.S. markets for 
cattle and beef, but there do not appear to have been longer-term 
decreases in the demand for beef or increases in the demand for 
substitute protein sources such as chicken and pork. In this respect, 
U.S. consumers' reaction appears to differ from the reaction of 
consumers in countries like Germany, Japan, and the United Kingdom 
following BSE discoveries in those countries.
    Issue: The economic analysis for the proposed rule is no longer 
applicable to current cattle market conditions, due to the Washington 
State BSE discovery.
    Response: The economic analysis for this final rule takes into 
consideration market changes that have occurred since the initial 
analysis was done. The Washington State BSE discovery has had a 
significant effect on U.S. beef exports, but it has had little effect 
on domestic demand, as reflected in continuing high price levels for 
beef and cattle.
    Issue: Once animals are allowed in, if boneless cuts are the only 
exports allowed, what will happen to the remaining cuts? Are they going 
to be dumped into our markets?
    Response: Beef imported from Canada, like beef from cattle of U.S.

[[Page 523]]

origin, will be consumed domestically or exported to another country 
depending on prices, trade arrangements, and the numerous other factors 
influencing the beef market. APHIS cannot predict the eventual use, 
other than to note current restrictions on U.S. beef exports.
    Issue: The most important impact of APHIS' proposed rulemaking is 
the potential for BSE cases in the United States caused by the 
importation of Canadian cattle. This is dismissed almost offhandedly in 
the published analysis. This conclusion has already been proven wrong 
and is the most glaring deficiency in the economic analysis of the 
proposed rule. Additionally, the proposed rule ignores the potential 
economic impact should Canada discover additional cases of BSE while 
the United States is known to be importing Canadian beef and cattle.
    Response: The risk mitigation measures included in the proposed 
rule were developed to ensure that ruminants and ruminant products 
imported from Canada pose a minimal BSE risk to the United States. 
Under the conditions of this final rule, the cow of Canadian origin 
that was diagnosed with BSE in Washington State would not have been 
eligible for importation into the United States. We do not expect the 
rule to result in an increased risk of BSE in the United States, given 
the risk-mitigating measures put in place in Canada and the monitoring 
of the movement of imported cattle that will be required. Removal of 
SRMs at slaughter and other risk-mitigating measures of the rule will 
ensure that beef entering from Canada satisfies animal health criteria 
the same as or equivalent to those required in the United States.
    Issue: The APHIS analysis ignores the cost the rule would have if a 
second BSE event occurred on U.S. soil due to the transmission, or 
market and consumer perception of transmission, resulting from this 
rule, or even the increased risk that producers and consumers would 
incur from trade with Canada when there is risk of introduction of BSE. 
A BSE outbreak would cause demand for beef to decline and an increase 
in human health concerns. Estimates of the cost of the 1986 outbreak on 
the British economy, with a herd size of 12.04 million head, are $5.8 
billion. Given that the U.S. herd size is 8 times larger, a worst-case 
scenario suggests the impacts on the United States could be as large as 
$46.4 billion.
    Response: U.S. consumers have not appeared to reduce beef 
consumption in response to the BSE case found in Washington State. The 
commenter refers to the economic impact of BSE in the United Kingdom, 
applying it to the North American situation. It is important to note, 
as reported by Mathews and Buzby, that the total number of confirmed 
cases of BSE in the United Kingdom has exceeded 175,000 on over 35,000 
farms, compared to the 2 confirmed cases in native North American 
cattle (Ref 45). We do not expect the rule to result in an increased 
risk of BSE in the United States.
5. Feeder Animal Movement and Feedlot Requirements
    Issue: APHIS did not consider in its economic analysis the costs of 
ensuring compliance with risk mitigation measures. Such verification 
(e.g., determination of animal age through dentition and the auditing 
of health certificates) will be burdensome and costly. Simply 
obtaining, tracking, and recording the necessary information will be 
time-consuming and take an undeterminable amount of man-hours.
    Response: We acknowledge there will be additional costs to U.S. 
cattle feeding and packing operations that decide to import Canadian 
cattle. The additional costs will include, but not be limited to, those 
associated with increased recordkeeping requirements. These costs will 
vary by operation. In the analysis for the final rule, we approximate 
the cost of inspection and certification for movement of Canadian 
feeder cattle from the port of entry to a feedlot and ultimately to a 
slaughter facility. As with other business expenditures, affected U.S. 
firms will include additional recordkeeping costs associated with 
importing Canadian cattle in their cost calculations, and will purchase 
Canadian cattle only if the expected returns of doing so outweigh the 
costs.
    Issue: Designated feedlots and slaughter facilities will need to 
develop a sound segregation plan for Canadian cattle. This adds another 
level of regulation, cost, and complexity. Without a national animal 
identification system, which is at least 2 years away, the only way for 
U.S. feedlots to keep segregation integrity with regard to U.S. and 
Canadian cattle would be to keep cattle in country-specific pens. This 
in itself would make it extremely difficult for feedlots to effectively 
manage cattle health care and feed costs, costing the industry millions 
of dollars annually. The only way to comply would be for feedlots to 
establish ``Canadian regions'' within each facility and construct 
separate hospital treatment facilities. This would also include the 
tracking of individual animal movements within designated feeding 
facilities, segregated transportation schedules and staged slaughter 
times--which requires a more efficient and effective communication link 
than current industry standards.
    Response: In this final rule, there are no requirements for 
designated feedlots with regard to feeder cattle imported from Canada. 
Further, the rule does not require feedlots or slaughter facilities to 
develop segregation plans for live cattle from Canada. Canadian feeder 
cattle, and feeder sheep and goats, moved from the port of entry to a 
feedlot and from the feedlot to slaughter must be accompanied by an 
APHIS Form VS 17-130 to the feedlot and from the feedlot to slaughter 
by an APHIS Form VS 1-27. These forms will list all animals moved. This 
final rule will also require that feeder cattle be individually 
identified before entry by an eartag that allows the animal to be 
traced back to the premises of origin. The eartag may not be removed 
until the animal is slaughtered.
    Issue: The costs of segregating Canadian cattle from U.S. cattle 
include additional downtime and changeover time (between processing 
imported Canadian cattle versus others), increased quality control and 
regulatory inspection, and a doubling of sku [stock keeping unit] 
inventory requirements (for ``export only'' sales under the Bovine 
Export Verification (BEV) program). Furthermore, these costs will 
definitely place smaller Northern tier single-plants at a disadvantage 
compared to those in other regions.
    Response: Segregation/tracking of Canadian-origin product at the 
processing stage and beyond will not be necessary to ensure that the 
products are safe. We address issues concerning the BEV program in our 
responses to other comments.
    Issue: The proposed rule requires that sheep and goats imported 
from a BSE minimal-risk region be less than 12 months of age if 
imported for immediate slaughter or for feeding and then slaughter. Was 
the cost of managing and maintaining imported Canadian sheep and goats 
as a separate group included in the economic analysis?
    Response: The cost of managing and maintaining imported Canadian 
sheep and goats as a separate group was not included in the economic 
analysis for the proposed rule. Whether individual feedlot operations 
consider it worthwhile to handle imports from Canada--i.e., whether the 
expected additional revenue exceeds the costs associated with feedlot 
designation--will be an individual choice and will be voluntary on the 
part of feedlots.

[[Page 524]]

    In this final rule, we specify that sheep and goats not for 
immediate slaughter will be required to be moved to designated 
feedlots. Criteria for designated feedlots include a written agreement 
between the feedlot's representative and APHIS that the feedlot will 
not remove eartags from animals unless medically necessary and cross-
reference with the original eartag any eartag that must be replaced on 
an animal, will create and maintain acquisition and disposition records 
for at least 5 years, will maintain copies of APHIS movement permits, 
will allow Federal and State health officials to inspect the premises 
and animals upon request, and will designate either the entire feedlot 
or designated pens within the feedlot as terminal for sheep and goats 
to be moved only directly to slaughter at less than 12 months of age.
    Issue: The record high prices for cattle that farmers and ranchers 
received during the summer and fall of 2003 have given way to limit[ed] 
down drops in live and future cattle prices. In addition, the market 
analysis done for the proposed rule ignores recent changes in 
Americans' diets and cattle herd culling due to extended drought 
conditions throughout the United States. The economic analysis also 
ignores that Canadian cattle were captive supplies for cattle that may 
have been used to manipulate United States cattle markets. These 
factors were not considered by APHIS in weighing the costs and benefits 
of the proposed rule.
    Response: Record high prices for cattle during the summer and fall 
of 2003 primarily resulted from tight cattle supplies due to weather 
conditions and the ban on imports from Canada. With resumption of 
imports from Canada and improved forage conditions, there will be an 
increase in the cattle supply, causing downward pressure on prices 
received by domestic producers. APHIS, of course, does not have 
authority under statutory mandate to regulate marketing practices such 
as packer ownership of captive cattle, and any issues presented by 
packer ownership of cattle supplies is outside the scope of this rule. 
The economic analysis does not consider captive cattle supplies in 
examining the costs and benefits of this regulation.
6. U.S. Beef Exports
    Issue: The economic analysis does not estimate the impact on the 
U.S. beef cattle industry as a result of trading partner discomfort 
with the lessening of restrictions on the importation of ruminants and 
their products from Canada. APHIS must rework the economic analysis to 
take this significant impact into consideration.
    Response: In the economic analysis for the proposed rule, we 
addressed possible impacts of the rule on U.S. cattle and beef exports. 
Consideration was given to the possibility that importing countries may 
not agree with the United States' categorization of Canada as a region 
of minimal risk. That part of the analysis, regarding possible 
restrictions on cattle and beef imports from the United States by other 
countries because of the rule, addressed possible impacts due to 
``trading partner discomfort.'' The analysis for this final rule takes 
into consideration current restrictions on U.S. beef exports and 
addresses the question of how the rule may affect these restrictions.
    Issue: The negative trade scenarios outlined in the cost-benefit 
analysis of the proposed rule are based upon there continuing to be 
very few countries in the world that fully adopt or embrace the 
recommendations of the OIE regarding imports from BSE-affected 
countries. Such an underlying assumption is rapidly changing. The 
possibility that the United States would face lasting negative trade 
effects as a result of implementation of the proposed rule seems 
increasingly remote.
    Response: In the economic analysis for the proposed rule, we did 
not assume there would be lasting negative trade effects. However, 
neither could we assume that negative trade reactions might not result 
if importing countries did not accept the U.S. categorization of Canada 
as a BSE minimal-risk region. We now have a different situation, with 
beef imports from the United States prohibited by a number of 
countries. It is possible that, because of the rule, these countries 
may either delay lifting current restrictions on cattle and beef 
imports from the United States or become more open to reestablishment 
of the imports. The analysis for this final rule addresses these 
possible impacts for U.S. beef exports.
    Issue: In its cost-benefit analysis, APHIS does not appear to have 
considered the recent U.S. experience with the cost of segregating U.S. 
origin meat from Canadian meat to meet Japan's demand that we ship to 
that country only U.S. born and slaughtered meat. To the extent there 
are data or estimates available regarding the cost to the U.S. industry 
to meet Japanese demands, this should be considered in APHIS' analysis.
    Response: We believe that the commenter is referring to the 
voluntary BEV program. Under the BEV program, USDA's Agricultural 
Marketing Service certifies through compliance audits that beef and 
other products exported by an eligible supplier are derived from cattle 
slaughtered in the United States. The BEV program, while ongoing for 
Canada and Mexico, has been terminated for Japan pending resumption of 
U.S. beef exports to that country. The BEV program will not be affected 
by this rule.
    Issue: Even if BEV-compliant slaughter facilities do not import 
Canadian live cattle, they will have to comply and certify they are not 
receiving Canadian-origin cattle from feedlots and adopt new BEV 
regulations.
    Response: As noted above, the BEV is a program, not a regulation, 
and is not covered by this rule. Slaughter facilities, if necessary, 
will be able to identify Canadian-origin cattle by the animal 
identification requirements included in the rule.
    Issue: The proposed analysis calculated the price effect from lost 
export markets by using elasticities and price information. A large 
factor that was not analyzed was the loss in premiums that the U.S. 
beef industry gains by ``upgrading'' cuts with a low value in the 
United States by sending them to markets that pay a much higher price 
for them. Japan is the main premium market for U.S. beef and beef 
variety meats. Based on 2000 research conducted by the United States 
Meat Export Federation, the extra value achieved by U.S. beef exports 
is $1.2 billion per year (Ref 46). The loss of export markets will 
directly pass those markets' portions of this loss of value back to the 
U.S. beef industry. These losses are in addition to the losses caused 
by an increased supply of beef on the U.S. market. The extent to which 
export premiums support prices of domestic beef should be further 
analyzed.
    Response: In the economic analysis accompanying the proposed rule, 
we stated that we were unsure how other countries would react to a 
resumption of ruminants and ruminant products from Canada. Because of 
the Washington State BSE discovery, most U.S. beef exports are now 
restricted. The question has become how the rule might affect current 
restrictions. In addressing this issue, we acknowledge the premium 
earnings foregone due to closed foreign markets.
    Issue: The proposed rule fails to take into account the value of 
the entire animal to the industry. The rule appears to look at muscle 
cuts, but ignores the ``drop value'' of products such as variety meats, 
rendered products and goods that utilize such items as a base 
ingredient (i.e., pet foods). No analysis was done for the potential 
loss of variety meat exports, both in terms of increased

[[Page 525]]

supply in the United States and lost premiums. Beef variety meat (BVM) 
exports to Japan averaged 149,388 metric tons from 2000-2002 and 
averaged $309 million in value. Japan is the number two market for BVM, 
while Korea is number four with an average of 22,949 metric tons valued 
at an average $36.5 million from 2000-2002. The Livestock Marketing 
Information Center states ``The byproduct value can have a considerable 
impact on current slaughter cattle prices.'' In mid-November, the 
byproduct (drop credit) value surpassed $10 per cwt on a live weight 
basis. This is a significant proportion (ten percent) of the entire 
animal value. What are the costs of losing these variety meat markets?
    Response: In response to the single case of BSE in Washington 
State, many export markets placed bans on imports from the United 
States. As the commenter states, Japan was the second largest market 
for U.S. BVM. Exports of BVM to Japan, January to March for 2003 and 
2004, illustrate the significance of lost sales. During these three 
months in 2003, 18,988 metric tons of BVM valued at over $41 million 
were exported to Japan. During the same months in 2004, only 154 metric 
tons of BVM with a value of $1.4 million were exported. A question 
addressed in the analysis for the final rule is whether the rule, in 
itself, can be expected to affect the restrictions on U.S. beef exports 
and therefore the continued loss of premium earnings on beef variety 
meat.
    Issue: It is assumed, although not stated in the proposed rule, 
that beef and variety meats would be segregated through processing 
beyond slaughter. If this is not done, all economic advantages of prior 
animal segregation are lost, while the associated costs of segregation 
are incurred by the industry with no benefit accruing to the domestic 
or international consumer.
    Response: This final rule does not impose any requirements vis-a-
vis labeling, segregation, or preservation of identity of the product 
of Canadian feeder or slaughter cattle. Once imported Canadian cattle 
are moved to slaughter, the application of FSIS rules for the removal 
and disposal of SRMs will prevent adverse consequences related to BSE.
    Issue: Costs of plant segregation lines were not included in the 
analysis. Assuming that the proposed rule allows the reestablishment of 
Canadian beef and cattle imports, and our export markets, mainly Japan 
and Korea, require that no Canadian beef be exported to them, the costs 
of animal and beef segregation would become a direct cost to the U.S. 
beef industry.
    Response: APHIS agrees that there could be operational and 
recordkeeping costs associated with exporting U.S. beef to Asian 
markets once they reopen, if the importing countries require that the 
products be derived from cattle of U.S. origin. However, if such 
requirements were placed on U.S. exports, the effects would be 
attributable to the policies of the importing countries, not to this 
rule.
    Issue: The APHIS analysis fails to address the likelihood that U.S. 
beef export customers would reject the proposed actions.
    Response: In the economic analysis for the proposed rule, APHIS 
addressed possible effects of the rule on U.S. cattle and beef exports. 
Consideration was given to the possibility that importing countries 
might not agree with the U.S. categorization of Canada as a region of 
minimal risk. In the analysis for this final rule, we consider whether 
the rule may influence other countries' decisions with regard to 
lifting of current restrictions on U.S. beef.
7. Effects on Small Entities
    Issue: With regard to potential effects of the rule on small 
entities, economies of scale dictate that larger entities will be 
better able to absorb increased fixed costs on a per-unit basis. 
Segregation costs in packing and processing sectors will have a larger 
impact on smaller entities. It is believed that larger entities are 
better situated to absorb market volatility than smaller firms. The 
history of production agriculture has shown that smaller producers have 
higher costs of production and face higher risks associated with lower 
market prices. The economic analysis as proposed by USDA would have 
harsher consequences on smaller enterprises.
    Response: APHIS agrees that larger entities will be better able to 
absorb costs associated with the rule than smaller entities, such as 
costs of segregating sheep and goats less than 12 months of age at 
designated feedlots. We expect entities that envisage a profit by doing 
so to make the capital investments and plan for the operating outlays 
that may be required to import such ruminants from Canada.
    Issue: The claim that the impacts on small business cannot be 
estimated due to lack of data is not correct. There is considerable 
data available from USDA's National Agricultural Statistics Service 
(NASS) on livestock inventories by operation size. There is clearly 
adequate data to define small business impact. APHIS should complete a 
more thorough economic analysis of these impacts, particularly in light 
of the events of December 2003. Such an analysis should be made 
available for public comment before consideration of adoption of the 
proposed rule.
    Response: APHIS showed in table 19 of the economic analysis for the 
proposed rule that the great majority of entities in industries 
expected to be directly affected by the rule are small, based on NASS 
data and Economic Census data. It is understood that effects of the 
rule will differ among entities, depending on specific business 
circumstances. APHIS does not have data that would allow a 
comprehensive analysis of potential economic effects for small entities 
beyond the price declines and welfare gains and losses that are 
described generally. We are unaware of NASS data or additional data 
available from the producer segment of the livestock industry that can 
be used to more finely examine these variations in impact. However, we 
do provide as an example possible effects of the rule on earnings by 
small beef cow operations.
    Issue: Any resumption of Canadian live cattle imports should be 
carefully studied to ensure there is no negative impact on the U.S. 
cattle market. Such analysis should focus on specific geographic areas, 
especially Idaho and the Pacific Northwest.
    Response: The various price and welfare effects described in the 
analysis are for the nation as a whole, because reestablished imports 
from Canada will not be restricted by region. However, it is recognized 
that regions of the United States that historically have been more 
closely associated with cattle imports from Canada can be expected to 
be more heavily affected by the rule. An example of possible effects on 
northern U.S. packing plants is referred to in the analysis of impacts 
of small entities.
8. Other
    Issue: Costs of removing intestines are not included in the 
analysis. This would be a requirement of cattle imported from Canada 
and associated costs should be outlined. Associated costs include the 
costs of removal as well as the loss of the intestine as a product as 
opposed to removal of only the distal ileum. The intestines are a 
significant product for international markets.
    Response: The FSIS SRM rule requires removal of the small intestine 
from all cattle slaughtered in the United States. For illustrative 
purposes, the FSIS Regulatory Impact Analysis estimates small intestine 
disposal costs to be $0.22 per animal, the value of the small intestine 
(casings and trepas) to be $12.21 per animal, and the value of 
alternative industrial uses of small intestine to be $0.33 per animal.

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G. Environmental Assessment for the Rulemaking

    Consistent with the National Environmental Policy Act of 1969 
(NEPA), as amended (42 U.S.C. 4321 et seq.), and regulations of the 
Council on Environmental Quality (CEQ) for implementing the procedural 
provisions of NEPA (40 CFR parts 1500-1508), we prepared an 
environmental assessment (EA) regarding the potential impact on the 
quality of the human environment due to the importation of ruminants 
and ruminant products and byproducts from Canada under the conditions 
specified in our proposed rule. In December 2004, we revised the EA to 
address the detection of a BSE-infected cow in Washington State in 
December 2003 and actions subsequently taken by Federal agencies to 
further protect the U.S. food supply from potential BSE infection. 
Other revisions to the EA include the addition of more detail about the 
available disposal methods of BSE-infected carcasses and information 
regarding disposal requirements for SRMs of cattle that are now 
required to be removed in the United States when establishments 
slaughter cattle or process cattle carcasses or cattle parts. The EA 
may be viewed on the Internet at http://www.aphis.usda.gov/lpa/issues/bse/bse.html.
    Issue: One commenter asked whether APHIS considered the appropriate 
disposal of intestines in its EA.
    Response: The revised EA gave an overview of the four methods that 
would be approved for disposal of diseased carcasses and discussed the 
FSIS SRM rule, which required slaughter establishments and 
establishments that process the carcasses or parts of cattle to 
develop, implement, and maintain written procedures for the removal, 
segregation, and disposition of SRMs. In its SRM rule, FSIS discussed 
the need for establishments to have the flexibility to choose the 
disposal method or methods most appropriate for them; however, general 
disposal procedures are found in 9 CFR 314.1 and 314.3.
    Issue: One commenter stated that APHIS should work with FSIS to 
develop an environmental impact statement (EIS) for this rulemaking. 
The commenter suggested that the proposed rulemaking would have 
potentially significant environmental effects and establishes a 
precedent for future actions with potentially significant environmental 
effects.
    Response: The commenter is distinguishing between an EA such as the 
one we have prepared for this rulemaking and an EIS. An EA is a concise 
public document by which a Federal agency briefly provides its analysis 
for determining whether to prepare an EIS or a finding of no 
significant impact (CEQ NEPA Implementing Regulations, 40 CFR 1508.9). 
An EA identifies and assesses the significance of potential impacts on 
the environment of the proposed action. Its purpose is to provide any 
agency with the appropriate environmental information to make an 
informed decision about the proposed action and assist the agency in 
deciding whether an EIS is needed. An EIS is a more extensive 
environmental analysis that seeks to compare potential positive and 
negative environmental effects and weigh negative environmental effects 
against an action's other objectives. As discussed above, APHIS has 
prepared an EA that analyzes the potential environmental effects of the 
proposed rule. (Instructions for obtaining or viewing the revised EA 
are included below under the heading ``National Environmental Policy 
Act.) The revised EA provides additional information on the anticipated 
nature and extent of environmental consequences and the relevance of 
preventive actions to protect public health and safety. Based on the 
known cause of BSE; on the risk information cited to and referenced in 
the EA; on the preventive actions set forth in this rulemaking and on 
other mitigation requirements imposed by FSIS, FDA, and the U.S. 
Environmental Protection Agency; and on the history of BSE in this 
country, this rulemaking should not significantly affect the quality of 
the human environment. The CEQ NEPA Implementing Regulations define 
significance in terms of intensity, including the degree to which the 
action may establish a precedent for future actions with significant 
effects or that it represents a decision in principle about a future 
consideration (40 CFR 1508.27(b)(6)). This section of the CEQ 
regulations does not apply to this rulemaking because: (1) The EA 
concludes that the effects are not significant, (2) there is no 
evidence that any effects in the rulemaking would be cumulative or 
cumulatively significant, and (3) any future importations from other 
countries that might eventually be designated BSE minimal-risk regions 
under this rulemaking will be considered in separate NEPA analyses.

H. Withdraw or Delay Implementation of Rule

Withdraw or Delay Rule for Economic Reasons
    Issue: A number of commenters recommended that APHIS withdraw, 
delay, or restrict implementation of the rule because of its potential 
negative economic effects on the U.S. livestock and livestock product 
industry, due to the potential significant influx of cattle from Canada 
over a short period of time. Additionally, said the commenters, the 
rule could harm the U.S. export market and its BSE status in the eyes 
of other countries if trade is allowed with Canada or if requirements 
less stringent than OIE recommendations are adopted. Further, 
commenters recommended that APHIS delay implementation of the rule 
until Canada removes its unfair restrictions on exports from the United 
States, and delay the rule until all U.S. export markets that were 
closed due to the December 2003 detection in an imported cow in 
Washington State are reopened. According to the commenters, if the rule 
is implemented, APHIS should do one or more of the following to 
minimize market disruptions:
     Offer an extended window for implementation that closely 
corresponds with the cattle industry's standard feeding period of 135 
to 150 days;
     Resume imports of live cattle in small increments and 
build up over a 3 to 5 year period;
     Do not allow cattle for immediate slaughter to be imported 
before feeder cattle;
     Establish a monthly quota for imported cattle until the 
backlog of cattle from Canada is reduced;
     Stagger resumption of imports of live cattle according to 
the feeding and weight of the animals;
     Restrict tonnage of imports to the amount that was being 
imported before restrictions on Canadian imports were established.
    Response: APHIS does not have authority to restrict trade based on 
its potential economic impact, market access effects, or quantity of 
products. Under its statutory authority, APHIS may prohibit or restrict 
the importation or entry of any animal or article when the agency 
determines it is necessary to prevent the introduction or dissemination 
of a pest or disease of livestock. However, APHIS is actively 
negotiating with trading partners to reestablish our export markets.
    Issue: One commenter stated that the importation of live cattle 
from Canada should not be resumed until Canada is able to verify that 
actions equivalent to those imposed by FDA have been in place for at 
least 30 months before such importation begins.
    Response: As stated above, we consider the feed ban in Canada to be 
equivalent to the one established and enforced by FDA in the United 
States,

[[Page 527]]

and we consider the feed ban to have been equivalent for more than the 
30 months recommended by the commenter.
    Issue: One commenter referred to an announcement by CFIA of its 
intention to conduct further inquiry into the importation of cattle 
into Canada between 1982 and 1989, their herds of origin in the United 
Kingdom, and the resulting use of rendered materials and feed 
distribution from 1986 until 1993. The commenter stated that the 
information from this phase of CFIA's investigation is vital to 
determining the risks of allowing further imports from Canada.
    Response: We acknowledge the potential value of further inquiry by 
CFIA in understanding the origin and nature of BSE in North America. 
However, the epidemiological investigations into both BSE cases (the 
BSE cow detected in Canada in May 2003 and the BSE cow imported into 
the United States from Canada and later slaughtered in Washington 
State) have indicated that it is likely the infected cows were born in 
Canada before implementation of the feed ban and thus were likely to 
have been infected under risk conditions that no longer exist. Under 
this rule, in combination with safeguards in place in Canada and in the 
United States, we consider the risk that BSE-infected or contaminated 
animals or animal products will enter the United States from Canada and 
expose U.S. livestock through feeding of infected materials to 
susceptible animals to be extremely low. Consequently, we do not 
consider it necessary to delay implementation of this rule until CFIA 
completes its inquiry.
Request for Public Meetings
    Issue: Several commenters requested that public meetings be held 
before this rule is made final. One of the commenters requested that 
USDA convene a meeting of beef producers and consumers to develop a 
strategy to protect our beef industry and consumers.
    Response: We do not believe that public meetings at this time would 
identify any issues that have not already been raised in the comments 
received on our proposed rule. As discussed above, we initially 
provided a 60-day comment period on our November 4, 2003, proposed 
rule, which closed on January 5, 2004. On March 8, 2004, we reopened 
the comment period for an additional 30 days until April 7, 2004. 
Additionally, we gave notice we would consider any comments on the 
proposed rule we had received between January 6, 2004 (the day after 
the close of the original comment period) and March 8, 2004. We 
received a total of 3,379 comments during the 5-month period between 
November 4, 2003 and April 7, 2004, and do not consider it necessary to 
hold public meetings before proceeding with this final rule.
    Issue: A number of commenters requested the delay of this 
rulemaking until the investigation of the December 2003 detection of 
BSE in a cow in Washington State was completed. Several commenters 
requested that APHIS wait until all appropriate domestic measures to 
reduce BSE risk are in place before allowing the importation of 
ruminant products from regions that have had a BSE case. Another 
commenter requested that APHIS not implement the proposed rule until 
the advance notice of proposed rulemaking published by APHIS in the 
Federal Register on January 21, 2003 (``Risk Reduction Strategies for 
Potential BSE Pathways Involving Downer Cattle and Dead Stock of Cattle 
and Other Species'' (68 FR 2703-2711, Docket No. 01-068-1)), and the 
advance notice of proposed rulemaking published by FDA in the Federal 
Register on November 6, 2002 (Ref 47) are followed by proposed and 
final actions. Several commenters requested that the final rule not be 
implemented until USDA has expanded BSE surveillance, testing, and 
prevention efforts and has increased funding for BSE research, 
education, and development of rapid tests to detect the disease in live 
animals.
    Response: We do not consider it necessary to delay implementation 
of this final rule. As discussed above in section III. B. under the 
heading ``Reopening of the Comment Period and Explanatory Note,'' an 
extensive investigation of the detection of the BSE-infected cow in 
Washington State has been completed. Since publication of the proposed 
rule and following the detection of the imported BSE case in Washington 
State, the United States has redirected resources towards planning, 
implementation, and enforcement of national policy measures to enhance 
BSE surveillance and protect human and animal health. In that regard, 
both USDA and FDA have initiated additional food and feed safety 
measures, discussed previously in this document. In addition, USDA has 
initiated an enhanced BSE surveillance program that targets cattle from 
populations considered at highest risk for BSE, Also, FSIS public 
health veterinarians have begun assisting in APHIS' BSE animal 
surveillance efforts by collecting brain samples from all cattle 
condemned during ante-mortem inspection at Federally inspected 
establishments. This will allow APHIS to focus on sample collection at 
locations other than Federally inspected establishments, such as 
rendering operations and farms. Details of the BSE surveillance plan 
are available at: http://www.aphis.usda.gov/lpa/issues/bse/BSE_Surveil_Plan03-15-04.pdf.
    Strengthening of the passive surveillance system for BSE through 
outreach and education is an integral part of the USDA surveillance 
plan. In this regard, APHIS has developed plans to enhance existing 
educational materials and processes in conjunction with other Federal 
and State agencies. These outreach efforts will inform veterinarians, 
producers, and affiliated industries of the USDA surveillance goals and 
the sometimes subtle clinical signs of BSE, and will encourage 
reporting of suspect or targeted cattle on-farm and elsewhere. One of 
the tools for reporting high-risk cattle, announced on June 8, 2004, is 
a toll-free number (1-866-536-7593).
    To help cover additional costs incurred by industries participating 
in the surveillance plan, and to help encourage reporting and 
collection of targeted samples, USDA may provide payments for certain 
transportation, disposal, cold storage, and other costs.
    In addition, increased funding has been requested for USDA's 
Agricultural Research Service (ARS) to further study BSE. Examples of 
research projects ARS is actively engaged in include: Development of 
information and methods to characterize and differentiate among the 
known prion diseases of ruminant livestock and cervids, including BSE; 
development and validation of diagnostic and surveillance tests for BSE 
and CWD and development of intervention strategies for these diseases; 
development of biological and biochemical methods for detection of the 
transmissible agent in animal tissues and in the environment; 
identification and development of new methods and collaborative 
arrangements with other institutions for detecting animal proteins, 
especially prion proteins (PrP), in fields, barns, abattoirs, animal 
feed, feed additives or other animal products; and development of novel 
techniques for destruction of prion molecules.
    It is important to note that all of the above measures are 
specifically designed to further minimize risks of BSE to animal and 
human health in the United States that were already low, as 
characterized by the Harvard-Tuskegee Study, even before the measures 
taken since December 2003. Because APHIS' risk analysis was based on 
the controls in place before these improvements, we

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consider it unnecessary to delay the implementation of this rule until 
additional measures are in place.
    General information and links to relevant APHIS documents are 
available at http://www.aphis.usda.gov/lpa/issues/bse/bse.html. General 
information and links to relevant FSIS documents are available at 
http://www.fsis.usda.gov/oa/news/2004/bseregs.htm. General information 
and links to relevant FDA documents are available at http://www.fda.gov/cvm/index/bse/bsetoc.html. In addition, the joint APHIS-
FSIS-FDA advance notice of proposed rulemaking published on July 14, 
2004, provides an overview of all Federal actions taken related to BSE 
and requests comment on additional measures under consideration.
    Issue: A number of commenters recommended not only that APHIS 
follow OIE guidelines for BSE minimal-risk status, but that the Agency 
also delay any rulemaking action until new guidelines regarding BSE 
risk have been set by OIE. Commenters noted that APHIS was involved in 
discussions with the international community regarding such guidelines. 
One commenter stated that OIE is only in the process of developing 
guidelines that would be consistent with the standards for minimal-risk 
regions in the proposal.
    Response: OIE guidelines have continually evolved and are likely to 
continue evolving, which is one reason that APHIS has decided not to 
simply adopt the OIE guidelines as regulations. The United States and 
other countries routinely propose revisions of the OIE BSE chapter (and 
other animal disease chapters) and make comments on draft OIE 
guidelines through official channels. These comments reflect technical 
and scientific issues relevant to the United States. The 
recommendations are reviewed by an ad hoc committee. As appropriate, 
the ad hoc committee issues a report suggesting revisions to existing 
OIE chapters. These are presented for adoption at the next General 
Session of the International Committee.
    For instance, in April 2004, the OIE ad hoc committee issued a 
report proposing an example of a simplified BSE classification scheme. 
This report followed a meeting held in Paris on April 15 and 16, 2004, 
which resulted from OIE discussions in 2003 regarding the OIE's desire 
to simplify the BSE risk categorization system while retaining its 
scientific base. The report included an example of a simplified BSE 
categorization scheme. It is planned that a simplified scheme will be 
proposed for possible adoption in 2005.
    OIE experts proposed a revision of the risk categories and a 
reduction in their number from five (``free,'' ``provisionally free,'' 
``minimal risk,'' ``moderate risk,'' and ``high risk'') to three 
(``negligible risk,'' ``controlled risk,'' or ``undetermined risk''). 
The report stated that the three-category system offered the best 
science-based practicable approach to the epidemiology of BSE in 
combination with an emphasis on the safety of commodities for trade 
rather than on a classification of country status. This overall 
approach, currently under consideration by OIE, is a scientifically 
sound approach consistent with APHIS' approach in this final rule, 
which evaluated in an integrated way the risk conditions existent in 
the exporting region in combination with risk mitigation measures for 
commodities. These proposed OIE changes, as well as current OIE 
guidelines, reinforce the validity of the approach APHIS adopted, which 
also includes an evaluation of risk in regions seeking to be 
categorized as minimal risk, coupled with an intense focus on commodity 
mitigations.
    Issue: Several commenters made various statements to the effect 
that we should not proceed with the rulemaking at this time because of 
a lack of certainty about the prevalence of BSE in Canada. Several 
commenters stated that the December 2003 find means that Canada no 
longer has a single case, and that Canada cannot now be considered a 
minimal-risk for BSE. One other commenter specifically disagreed with 
APHIS' conclusion that the additional case of BSE of Canadian origin 
does not significantly alter the original risk estimate. Another 
commenter stated that, based on the respective cattle populations, the 
detection of BSE in 2 cows of Canadian origin is the equivalent of 15 
positive cases in the United States in less than a year and that, 
therefore, the risk of BSE from Canada is too high to resume imports. 
Several commenters asked whether the finding of a second BSE cow of 
Canadian origin will preclude Canada from consideration as a BSE 
minimal-risk region.
    Response: The diagnosis of BSE in a cow of Canadian origin in 
Washington State in December 2003 does not preclude Canada from being 
considered a BSE minimal-risk region. Under this rule, a determination 
of minimal-risk status is based on an evaluation of all of a country's 
BSE prevention and control measures and not on any single criterion, 
such as the number of reported cases of BSE or any numerical threshold 
for prevalence. While we did not quantitatively estimate the true 
prevalence of BSE in Canada, we did evaluate the evidence involving the 
reported incidence of BSE and the nature and level of BSE surveillance 
for minimal risk regions in general and for Canada in particular. There 
is ample evidence to support the conclusion that the prevalence in 
Canada is very low and that Canada has implemented BSE prevention and 
control measures adequate to prevent widespread exposure and/or 
establishment of the disease.
    Further, and, we believe, very importantly, the epidemiological 
evidence obtained shows that both animals referred to by the commenters 
were likely to have been infected before implementation of the Canadian 
feed ban. As noted, cattle born before the 1997 feed ban are not 
eligible for importation under this rule. Therefore, the detection of 
BSE in the two animals does not reflect the current risk conditions in 
Canada and the U.S. import conditions addressed in the analysis and 
proposed rule. In addition to the measures currently in place in Canada 
that make it unlikely that new cases are developing, the import 
restrictions in this rule and safeguards in place in the United States 
make it highly unlikely that the BSE agent will be introduced into the 
United States from Canada, spread to the U.S. cattle population, or 
enter the U.S. human food supply through ruminants or ruminant products 
or byproducts imported into the United States from Canada.
    Issue: A number of commenters recommended that APHIS not allow the 
importation of cattle, beef, or beef products from Canada until more 
time has passed. The periods of time suggested by commenters ranged 
from 2 years to 12 years. Commenters provided various reasons for their 
recommendations. While some commenters recommended a delay only in 
allowing the importation of cattle, others requested a moratorium on 
all imports of live cattle, fresh beef, pre-cooked beef, and beef 
products until a specified period of time has elapsed or until 
exporters can prove the commodities are BSE-free. Some stated generally 
either that it requires a substantial amount of time until a region can 
be considered to present no risk or that more information is necessary 
on Canada's BSE prevention efforts. One commenter recommended that the 
importation of live cattle from Canada not be resumed until USDA can 
assure the U.S. beef industry and the public that it has done a 
complete analysis of the Canadian livestock production system to ensure 
that

[[Page 529]]

potential exporters are in full compliance with U.S. regulations that 
seek to prevent the introduction and spread of BSE in the United 
States. Others said that APHIS should follow WHO guidelines, which 
various commenters said recommend waiting periods of from 4 to 12 years 
from the date of detection of BSE. Several commenters recommended that 
the importation of beef and live cattle from Canada be prohibited until 
30 months from May 20, 2003, the date a BSE-infected cow in Alberta, 
Canada was diagnosed.
    Response: We do not consider it necessary to delay implementation 
of this final rule. We have evaluated the BSE risk mitigation measures 
for ruminants and ruminant products in place in Canada and consider 
them equivalent to the measures that are in place in the United States. 
These measures are discussed in more detail in this document under the 
headings ``Reopening of the Comment Period and Explanatory Note'' 
(section III. B), ``Measures Implemented by FSIS'' (section III. C.), 
``Verification of Compliance in the Exporting Region'' (section IV. 
D.), ``Measures Taken in Canada in Response to BSE Risk Prior to May 
2003'' (section III. C.), and ``Epidemiological Investigation and a 
Report by an International Review Team'' (section III. C.). As noted 
above, APHIS conducted a risk analysis for this rulemaking. The risk 
analysis took into account the Canadian measures already in place, as 
well as our proposed mitigation measures for importation. Based on our 
analysis of risk, we concluded that any BSE-risk was thoroughly 
mitigated under the proposed import restrictions. Additional measures 
implemented since that time, both in the United States and Canada, 
further reduce risks.
    With regard to the reference to WHO guidelines for waiting periods, 
we are unaware of WHO standards regarding the time periods the 
commenters' recommended for delay of this rule. The most recent WHO 
guidelines (Ref 48) reference OIE guidelines for trade, which include 
provisions for trade of live cattle and meat and meat products under 
certain conditions even from countries that would be considered high 
risk for BSE under OIE guidelines.
    In addition, it is very important to note again the point made in 
the technical discussion in the risk analysis that certain commodities, 
such as muscle meat, are a BSE low-risk commodity in and of themselves. 
In that discussion, we pointed out that even cattle carrying the BSE 
infectious agent are unlikely to carry that agent in tissues that have 
not had demonstrated infectivity (e.g., muscle, liver, skin, hide, 
milk, embryos) or products derived from these tissues.
Require Certification From All Countries
    Issue: One commenter requested that APHIS not implement this rule 
with regard to Canada until the Agency requires certification regarding 
livestock feed production from all U.S. trading partners, similar to 
that required by this rule for minimal-risk regions, and requires them 
to allow the United States to perform random investigations and testing 
of their production facilities as a condition of market access.
    Response: We do not consider it necessary to postpone 
implementation of this rule for the reason recommended by the 
commenter. APHIS evaluates regions on an individual basis to assess the 
risk of importing animals and animal products into the United States. 
When supported by such an evaluation, restrictions are imposed as 
necessary on imports from exporting regions. As part of the evaluation 
related to BSE, we evaluate the livestock feed practices. We impose 
import restrictions necessary to ensure that the practices are 
appropriate. In addition, we have the authority to and will, of course, 
re-evaluate regions when necessary (Sec.  92.2(g)). We consider the 
requirements spelled out in this rule to be comprehensive and 
sufficient to mitigate the risk of BSE introduction into the United 
States.
Tracking of Animals
    Issue: Several commenters stated that a national tracking system 
compatible with the Canadian system should be established in the United 
States before importations occur. One commenter recommended methods for 
efficiently administering such an identification system.
    Response: We do not consider it necessary to delay implementation 
of this rule until a national animal identification system is 
implemented in the United States. The animals that will be allowed 
importation under this rule will either be moved directly to slaughter 
or be officially and permanently identified and moved within a short 
period of time under APHIS movement permit to slaughter once in the 
United States.
    Issue: A number of commenters requested that importation of 
ruminants and ruminant products from Canada not be resumed until more 
research on BSE is done. Another commenter mentioned that the science 
of prions is in its infancy and disputed the notion that prions appear 
only in older animals and not in milk or muscle.
    Response: We do not consider it necessary to wait until more 
research is conducted or more information from Canada is available 
before implementing this rule. We consider the BSE research upon which 
we based the proposed rule and this final rule to be very substantial, 
and consider the mitigation measures in this rule to be very well 
supported by the research. We discussed the research upon which we 
based this rulemaking in the risk documents we made available with our 
November 2003 proposed rule and March 2004 notice of extension of the 
comment period. Additionally, in the update to our risk analysis 
described above in section II. C. under the heading ``Update to APHIS' 
Risk Analysis and Summary of Mitigation Measures and Their 
Applicability to Canada as a BSE Minimal-Risk Region,'' we describe the 
sequential risk barriers that Canadian imports will be subjected to. 
The commenter who disputed whether prions appear only in older animals 
and not in milk or muscle did not provide any data to support that 
contention and we are unaware of any reports that demonstrate BSE 
infectivity in ruminant milk and skeletal muscles.

I. Miscellaneous

Consider Regionalizing Parts of Canada
    Issue: Some commenters suggested that APHIS regionalize Canada to 
differentiate Canadian provinces where BSE-infected cattle have been 
detected from provinces that have not had a BSE case.
    Response: We are making no changes based on the comments. The 
information currently available to us does not suggest a difference in 
risk factors between provinces in Canada to the extent that would be 
necessary to justify such regionalization. Consequently, APHIS is 
categorizing all of Canada as a BSE minimal-risk region.
Effectiveness of Existing Regulations
    Issue: One commenter stated that the detection of BSE in a cow 
slaughtered in Washington State indicates that even the existing 
regulations are not sufficiently robust to protect the U.S. cattle 
industry and the consumer from the introduction of BSE.
    Response: From the time of the diagnosis of a BSE-infected cow in 
Canada in May 2003 until implementation of this final rule, the 
importation of live ruminants from Canada has been prohibited. As we 
discussed in the Explanatory Note to our risk analysis and in section 
III. B.

[[Page 530]]

above under the heading ``Reopening of the Comment Period and 
Explanatory Note,'' the epidemiological investigation of the imported 
BSE-positive cow slaughtered in Washington State shows that the 
infected cow was not indigenous to the United States and most likely 
became infected in Canada before that country's implementation of a 
feed ban, and, therefore does not reflect current risk conditions. 
Furthermore, all cattle identified in the United States as possibly 
having been from the Canadian source herd of the infected cow were 
euthanized and tested for BSE, and all of the animals tested negative. 
Because there is a small probability that BSE can be transmitted 
maternally, the two live offspring of the infected cow were also 
euthanized. A third had died at birth in October 2001. All carcasses 
were properly disposed of in accordance with Federal, State, and local 
regulations. Also, in conjunction with USDA's investigation, FDA 
conducted an extensive feed investigation. By December 27, 2003, FDA 
had located all potentially infectious product rendered from the BSE-
positive cow in Washington State. The product was disposed of in a 
landfill in accordance with Federal, State, and local regulations. This 
rule by its terms requires that any cattle imported into the United 
States from Canada were born after the implementation of that country's 
feed ban.
Enforcement of Current Regulations
    Issue: One commenter suggested that USDA focus its limited 
resources on effectively enforcing current BSE regulations, rather than 
subjecting the U.S. industry and consumers to what the commenter viewed 
as an increased BSE risk. The commenter stated that import data 
obtained through reports from the Economic Research Service (ERS) in 
2001 and the Foreign Agricultural Service (FAS) show that several BSE-
affected countries have exported beef to the United States. Also, the 
commenter said Japan should have been listed as an ``undue risk'' 
country because it did not implement internationally recommended feed 
import restrictions and because its import requirements were less 
restrictive than those acceptable for import by the United States.
    Response: APHIS has examined U.S. import statistics reported by ERS 
and FAS that the commenter stated indicated the importation of products 
from countries with cases of BSE in violation of current APHIS import 
rules. In many cases, these reports have turned out to be erroneous. In 
the import databases, several commodities--including those that are 
restricted from importation and those that are not--may be included in 
a given category of imports, so the data are subject to 
misinterpretation. In addition, we have identified certain errors in 
the reports, such as the miscoding of imports that actually came from 
Australia as having originated in Austria. Further, import codes are 
based on tariff needs rather than on animal health needs, which makes 
it difficult to use the reports to determine compliance with animal 
health based trade restrictions. We are satisfied that our current 
import requirements are being properly enforced.
    With regard to imports from Japan, following the finding of the 
first case of BSE in Japan in 2001, APHIS immediately banned the 
importation of live ruminants and ruminant products and byproducts from 
that country, and codified that ban by publishing an interim rule in 
the Federal Register on October 16, 2001 (66 FR 52483-52484, Docket No. 
01-094-1), that added Japan to the list in Sec.  94.18(a) of regions in 
which BSE exists. Before detection of BSE in Japan, that country was 
not listed as a region that posed an undue risk of BSE. At the time the 
``undue risk'' category was developed, the focus was on trading 
practices among Member States of the European Union, because the 
European Union was where BSE was first detected and its Member States 
largely follow uniform trade practices. It is not clear to us from the 
comment what import practices in Japan are being referred to. The lack 
of a feed ban was not specifically part of the rationale for 
establishing the ``undue risk'' category.
Follow-Up to Washington State Detection
    Issue: Following detection of BSE in an imported cow in Washington 
State in December 2003, one commenter recommended that a group of USDA 
stakeholders be assembled to work with the Secretary of Agriculture's 
BSE advisory group to address all issues arising out of the 
epidemiological investigation, emergency response, and mitigating 
measures announced by the Secretary on December 30, 2003.
    Response: Following detection of BSE in December 2003 in an 
imported dairy cow in Washington State, USDA and other Federal and 
State agencies worked together closely to perform an epidemiological 
investigation, trace any potentially infected cattle, trace potentially 
contaminated rendered product, increase BSE surveillance, and take 
additional measures to protect human and animal health. USDA worked in 
collaboration with the CFIA in conducting the investigations. 
Additionally, an international team of scientific experts (the IRT) 
convened by the Secretary of Agriculture as a subcommittee of the 
Secretary's Advisory Committee on Foreign Animal and Poultry Diseases 
(SACFADP) reviewed the U.S. response and recommended actions that could 
provide additional meaningful human or animal health benefits in light 
of the North American experience. Both the IRT and the full SACFADP 
include governmental and nongovernmental representatives who made 
recommendations for enhancements of the national BSE response program 
in the United States (Ref 34 and 35).
Imports From Canada Before May 2003
    Issue: Several commenters recommended that BSE surveillance in the 
United States be targeted at cattle imported from Canada into the 
United States before May 2003.
    Response: This recommendation does not directly apply to this 
rulemaking but, rather, to our animal surveillance program for BSE. 
Nevertheless, to address the potential risk posed by these earlier 
imports, USDA and the U.S. Department of Health and Human Services have 
opted to focus resources on activities that offer the most direct 
protection of animal and public health. These included applying SRM 
removal requirements, enforcing the feed ban, and very aggressively 
increasing overall surveillance in the United States. The Departments 
have determined that focusing on these measures will be very effective 
and will do far more to lessen the possibility of BSE-infected material 
affecting animal health or reaching the public than devoting resources 
to the exceptionally difficult task of tracing Canadian-origin animals 
and conducting a surveillance program focused on such Canadian-origin 
animals.
Possible Causes of BSE Infection
    Issue: One commenter asked whether it is known conclusively that 
cattle can become infected with BSE through eating contaminated 
materials.
    Response: Oral ingestion of feed contaminated with the abnormal BSE 
prion protein is the only documented route of field transmission of BSE 
(Ref 49) although other routes have been considered. Thus, the primary 
source of BSE infection appears to be commercial feed contaminated with 
the infectious agent. The scientific evidence shows that feed 
contamination results from the incorporation of ingredients that 
contain ruminant protein derived from infected

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animals. Standard rendering processes do not completely inactivate the 
BSE agent. Therefore, rendered protein such as meat-and-bone meal 
derived from infected animals may contain the infectious agent and can 
result in the infection of other animals that consume the material.
Canadian Prohibition of Imports
    Issue: One commenter noted that in 1996 Canada prohibited imports 
of live ruminants from any country not recognized as free of BSE, and 
asked why, now that BSE has been detected in cattle indigenous to 
Canada, the United States would take a different approach than Canada 
did and allow imports from that country.
    Response: The BSE situation addressed by Canada in 1996 was 
significantly different from the BSE situation in that country today. 
Actions taken now can be based on scientific research and information 
that was not available in 1996. In 1996, BSE concerns were focused on 
the United Kingdom and other countries with a high incidence of the 
disease. In addition, significant concern existed regarding the risks 
of possible human exposure to the BSE agent if the importation of live 
cattle from those regions were allowed. At that time, the apparent link 
between BSE and vCJD had just been announced, and predictions were 
being made of huge numbers of cases of vCJD. Since 1996, understanding 
of the disease has increased significantly, as has our knowledge of and 
experience with measures that can be taken to mitigate the risk. In 
addition, the predictions related to numbers of human cases have been 
scaled down dramatically, reflecting a better understanding of the true 
exposure that might have occurred. Today, effective import conditions 
can be designed to address specific risk issues.
U.S. Approach to BSE as Compared to Other Diseases
    Issue: Several commenters expressed concern that APHIS' import 
policy with regard to BSE seems to differ from its general policy with 
regard to other foreign animal diseases. One commenter stated that, 
with most diseases, APHIS does not allow importation until adequate 
surveillance has been done to prove freedom from the disease. However, 
with regard to BSE, stated the commenter, APHIS allows imports from a 
region until a case of BSE is identified in that region. The commenter 
stated that APHIS should define standards for all levels of trade with 
various countries concerning BSE. Another commenter said that a country 
should be classified into one of the BSE established categories before 
trade in ruminant and ruminant products can be established.
    Response: With regard to trade from BSE-affected countries, in 
Sec.  94.18(a)(1) APHIS currently maintains a list of regions where BSE 
is known to exist. Additionally, Sec.  94.18(a)(2) lists regions that 
present an undue risk of BSE because their import requirements are less 
restrictive than those that would be acceptable for import into the 
United States and/or because the regions have inadequate surveillance 
for BSE. APHIS prohibits the importation of live ruminants and certain 
ruminant products and byproducts both from regions where BSE is known 
to exist (and that are not considered BSE minimal-risk regions) and 
from regions of undue risk, even though BSE has not been diagnosed in a 
native animal in the latter regions.
    As a newly discovered disease, BSE was limited in its geographic 
distribution to the United Kingdom and certain other countries in 
Europe. There was no evidence to suggest the disease existed elsewhere 
in the world. This situation lent itself to the policy of adding 
regions to lists of BSE-affected regions or regions that present an 
undue risk of BSE based on evidence of the disease's existence in those 
regions or on evidence that there was an undue risk of the disease 
existing in those regions, rather than assuming that BSE exists in 
every country of the world unless proven otherwise. This is consistent 
with our approach to other diseases, such as African horse sickness, 
which has never been shown to exist in countries other than in Africa 
and some countries on the Arabian Peninsula. Also, in contrast to 
infectious diseases that can be diagnosed relatively quickly, BSE has 
an extremely long incubation period.
    If the commenter who discussed the need to conduct adequate 
surveillance to prove freedom from a disease before allowing 
importations was referring to the proposed provisions that would allow 
the importation of ruminants and ruminant products from Canada, it 
should be noted that we did not propose to consider Canada as a region 
free of BSE. Rather, in this rule we are creating a new category of 
regions that present a minimal risk of introducing BSE into the United 
States via imported ruminants and ruminant products and byproducts. 
This category is in addition to the categories of regions where BSE 
exists and regions that present an undue risk for BSE. We are adding 
conditions to allow the importation of certain live ruminants and 
ruminant products and byproducts from BSE minimal-risk regions (at this 
time, only Canada). As discussed in our proposed rule and in this 
Supplementary Information section, we will evaluate other regions as 
potential BSE minimal-risk regions upon their request and submission of 
the necessary information.
    We described in the proposed rule and the risk analysis conducted 
for this rulemaking that Canada has conducted BSE surveillance since 
1992. For the past 7 years, Canada has tested more than the minimum 
number of samples recommended by OIE. Additionally, we consider Canada 
to have exceeded the OIE guideline for surveillance by conducting 
active targeted surveillance, as has been done in the United States. We 
concluded that Canada's level of surveillance is adequate for that 
country to be recognized as a BSE minimal-risk region.
Change in BSE Status
    Issue: One commenter stated that this rule should include criteria 
for determining when the BSE minimal-risk status of a region will be 
changed to a status of higher or lower risk, and should include how 
criteria for such a change in classification will be reviewed and 
evaluated.
    Response: We acknowledge that there may be situations where the BSE 
minimal-risk status of a region should be changed to a status of higher 
or lower risk. As proposed, however, this rulemaking was intended to 
establish and address standards for recognizing a region as a BSE 
minimal-risk region, along with mitigation measures for the importation 
of susceptible animals and animal products from such regions. We have 
taken the commenter's recommendation under review, and, if we determine 
that standards for movement to a higher or lower risk status should be 
promulgated, we will propose those standards in a separate rulemaking. 
The provisions in Sec.  92.2(g) recognize the need to conduct ongoing 
monitoring of a region's animal health status and provide that a region 
that has been granted animal health status under the APHIS regulations 
may be required to submit additional information pertaining to animal 
health status or allow APHIS to conduct additional information 
collection activities in order for that region to maintain its status.
WHO Guidelines
    Issue: One commenter stated that the WHO does not recognize 
``minimal-risk BSE countries'' and that WHO policy is not to allow 
imports of beef or cattle from BSE countries. Therefore, said the 
commenter, the import of beef and cattle from Canada should not be 
allowed.

[[Page 532]]

    Response: As discussed above under the heading ``Withdraw or Delay 
Implementation of Rule,'' we are not aware of any WHO guidelines that 
reference specific trade policies. It is the OIE guidelines (Ref 2) 
that are relevant in this regard, and OIE guidelines include provisions 
for trade in live cattle and meat and meat products from countries in 
all categories--including those at high risk for BSE.
Indemnity for U.S. Producers
    Issue: One commenter asked whether USDA will indemnify U.S. 
producers if our trading partners question movement and identification 
controls for cattle imported from Canada and Canadian feeder cattle 
become unmarketable.
    Response: APHIS will not indemnify U.S. producers for the actions 
of trading partners.
Recognize Isolated Donor Herds
    Issue: Several commenters requested that the regulations allow 
ruminant products to be collected from isolated herds that have been 
controlled to be free from exposure to contaminated feed and animal 
diseases, and that APHIS work with companies that currently have such 
herds to established harmonized standards for BSE freedom.
    Response: We are making no changes based on these comments. There 
are currently no procedures in place for classifying herds as BSE free, 
and it would not be appropriate to add such criteria in this final 
rule. However, APHIS welcomes information from interested parties on 
recommended criteria for BSE-free herds.
Feed Ban and Processing Compliance in the United States
    Issue: One commenter recommended that we check more rigorously for 
violations of the ban on ruminant products in ruminant feed in the 
United States. Another commenter stated that FDA data from 2000 and 
2002 indicate low compliance with the ban on feeding ruminant protein 
to ruminants in the United States.
    Response: The United States, through the FDA, implemented a feed 
ban prohibiting the use of most mammalian protein in feeds for ruminant 
animals, effective August 4, 1997. This prohibition appears in 21 CFR 
part 589.2000. Compliance with the 1997 FDA feed ban is currently very 
high. Current compliance numbers are not readily comparable with 
numbers that were published in 2000 and 2002. The two sets of 
compliance numbers were drawn from different databases and used 
different presentation formats. Current numbers differentiate between 
serious and minor violations of the feed rule, the latter of which 
generally consist of minor recordkeeping deviations. Previous 
compliance numbers included those minor recordkeeping as part of the 
total number of violations. A level of high compliance by feed mills, 
renderers, and protein blenders has been noted for a number of years. 
BSE inspection results are accessible on the Internet at http://www.fda.gov/cvm/index/bse/RuminantFeedInspections.htm.
Animal Feed Restrictions
    Issue: Several commenters requested that no animal protein and fat 
be allowed in feed for farm animals, so as to prevent the possibility 
of cross-contamination of concentrate feed in mills and accidental 
misfeeding on farms that contain different species of animals. Several 
commenters requested that SRMs be banned from use in all animal feed.
    Response: As noted, the FDA enforces a feed ban prohibiting the use 
of most mammalian protein in feeds for ruminant animals and compliance 
with this feed ban is currently very high. In the joint FDA-FSIS-APHIS 
advance notice of proposed rulemaking published July 14, 2004, FDA 
requested additional information to help it determine the best course 
of action with regard to the feed ban. As discussed above under the 
heading ``Measures Implemented by FSIS,'' FSIS bans the use of SRMs in 
human food.
Products for Human Consumption
    Issue: One commenter stated that USDA should act to ensure that no 
central nervous system tissue (CNS) is found in meat destined for human 
consumption. The commenter said that a survey conducted by FSIS in 2002 
regarding the use of advanced meat recovery (AMR) systems in the United 
States indicated that 74 percent of establishments surveyed tested 
positive for CNS tissue contamination. (AMR is a technology that 
enables processors to remove the attached skeletal muscle tissue from 
livestock bones without incorporating significant amounts of bone and 
bone products into the final meat product.)
    Response: With regard to beef product derived from an AMR system, 
FSIS reported that their 2002 survey indicates that approximately 76 
percent (25 of 34) of the establishments whose AMR product was tested 
had positive laboratory results for spinal cord, dorsal root ganglia 
(clusters of nerve cells connected to the spinal cord along the 
vertebral column), or both in their final beef AMR products. However, 
as discussed in this Supplementary Information section under the 
heading ``Measures Implemented by FSIS,'' in an interim final rule 
published and made effective on January 12, 2004, FSIS expanded the 
previous prohibition against spinal cord tissue being present in meat 
derived from AMR systems to include all CNS tissue. In addition, in its 
January rulemaking, FSIS prohibited the manufacture of mechanically 
separated beef, as well as the production of AMR using SRMs.
    Issue: A number of commenters stated that APHIS should make final 
its proposed rule only if the United States bans all rendered products 
from the human food supply.
    Response: FSIS has identified those tissues that are unfit for 
human consumption regardless of whether cattle exhibit signs of BSE. As 
a result, all SRMs, as well as the small intestine, are prohibited from 
entering the human food supply, and if rendered, may be used only in 
inedible rendering.
    Issue: As discussed above under the heading ``Measures Implemented 
by FDA,'' FDA has prohibited SRMs, the small intestine of all cattle, 
material from non-ambulatory disabled cattle, material from cattle not 
inspected and passed for human consumption, and MS(beef) from use in 
FDA-regulated human food, including dietary supplements, and cosmetics. 
One commenter stated that the APHIS was silent on whether Canada plans 
to adopt those new FDA restrictions.
    Response: FDA applies any restrictions it establishes on the use of 
products in the United States to products imported into the United 
States and will enforce those restrictions with regard to imports from 
Canada accordingly.
Restrictions on Product Use Due to Clinical Signs of BSE
    Issue: One commenter stated that, to avoid consumer problems, 
Federal agencies should provide that any animals exhibiting symptoms of 
BSE may be used only for pet food.
    Response: All cattle slaughtered in Federally inspected 
establishments in the United States are subject to inspection. FSIS 
inspectors examine cattle to identify any symptoms of disease, 
including signs of central nervous system impairment. Cattle that are 
suspect for any reason are examined by an FSIS veterinarian to 
determine whether the animals are eligible for slaughter. Cattle that 
show signs of systemic illness and disease are condemned and are not 
allowed into the human food supply. As noted, FDA currently prohibits 
the feeding of most

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mammalian protein (other than that from horses and pigs) to ruminants, 
and is developing a proposed rule to further strengthen the feed ban.
Uniform Standards
    Issue: Several commenters requested that this rule not be 
implemented until a uniform set of BSE standards has been agreed upon 
among the United States, Canada, and Mexico. The commenters stated that 
particular relevance should be placed on a ban on the inclusion of 
blood meal in ruminant feed and on the segregation of lines in feed 
mills, as FDA announced it was planning to propose.
    Response: The United States has been discussing a North American 
approach to the BSE issue for a number of years. Officials from the 
United States hold annual meetings with Canadian and Mexican technical 
experts from counterpart agencies that cover animal health, public 
health, diagnostics, and research. These meetings have contributed to 
greater understanding and harmonization of BSE control and prevention 
policies among the three countries. In fact, the United States, Canada, 
and Mexico have an agreement to recognize BSE region evaluations 
conducted by any of the three countries, using the same standards.
    Currently, the United States is working with Canada and Mexico to 
develop a joint North American BSE strategy that promotes international 
guidelines protecting public and animal health, while encouraging the 
use of science- and risk-based trade measures in order to maintain 
sound disease surveillance and transparent reporting. Some of the 
preliminary results from those discussions are reflected in this final 
rule, such as the changes from our proposed provisions regarding the 
importation of live cervids into the United States (discussed above 
under the heading ``Cervids'').
    Issue: One commenter recommended that implementation of this rule 
be delayed until there is a clear consensus among trading partners as 
to what constitutes SRMs.
    Response: As noted above, the United States is working with Canada 
and Mexico to develop a joint North American BSE strategy and those 
three countries agree on what constitutes SRMs. APHIS is also 
interested in maintaining consistency with OIE guidelines regarding 
SRMs, although in certain cases the USDA considers it prudent to exceed 
the guidelines currently recommended by OIE.
Country-of-Origin Labeling
    Issue: A number of commenters recommended that country-of-origin 
labeling be required in the United States so that beef imported from 
Canada would be so labeled. Some commenters suggested APHIS postpone 
implementation of this rule until such labeling is in place in this 
country. Several commenters raised concerns about how the United States 
would be able to certify U.S.-produced material as free of Canadian-
sourced material.
    Response: Under the Farm and Security and Rural Investment Act of 
2002 and the 2002 Supplemental Appropriations Act, USDA is required to 
implement a mandatory country of origin labeling program (COOL) (Ref 
50). USDA's Agricultural Marketing Service (AMS) published a proposed 
rule on the COOL program on October 30, 2003 (68 FR 61944-61985, Docket 
No. LS-03-04). Under the proposal, retailers would be required to 
notify their customers of the country of origin of all beef (including 
veal), lamb, pork, fish, and selected other perishable commodities 
being marketed in their stores. In addition, the AMS proposal 
identified criteria that these commodities must meet to be considered 
of U.S. origin. In January 2004, President Bush signed Public Law 108-
199, which includes a provision to delay until September 2006 the 
implementation of mandatory COOL for all covered commodities except 
wild and farm-raised fish and shellfish. The COOL program, when 
implemented, will address the labeling concerns raised by commenters 
with regard to APHIS'' proposed rule. APHIS does not consider it 
necessary to delay implementation of this rule until those labeling 
provisions are implemented. In its October 30, 2004 proposal, AMS 
noted, in discussing Section 10816 of Public Law 107-171 (7 U.S.C. 
1638-1638d) regarding COOL that the ``intent of the law is to provide 
consumers with additional information on which to base their purchasing 
decisions. It is not a food safety or animal health measure. COOL is a 
retail labeling program and as such does not address food safety or 
animal health concerns.''
Jurisdiction
    Issue: One commenter expressed the need for elimination of what the 
commenter termed conflicts of jurisdiction between the agencies of the 
Federal Government that oversee public health and safety. As an 
example, stated the commenter, the November 2003 APHIS proposed rule 
gives APHIS precedence over FSIS in determining whether an animal or 
its food products are safe to import, even though APHIS does not have 
authority to regulate food derived from the animal. One commenter 
stated that this rulemaking should be under the control of a human 
health agency because USDA has no expertise in the subject area. 
Another commenter suggested as a possible solution to what the 
commenter viewed as overlapping agency authorities the development of a 
single food agency in the United States to oversee all aspects of the 
food product safety system.
    Response: We disagree with the commenters' assessments. The issues 
of protecting human and animal health from the risks of BSE are 
sufficiently diverse to require involvement of multiple agencies acting 
under their respective authorities. This work is carried out primarily 
through the USDA agencies of APHIS for animal health and FSIS for food 
safety, along with FDA. USDA has the statutory authority to protect 
both animal agriculture (AHPA) and public health (the Federal Meat 
Inspection Act, the Poultry Products Inspection Act of 1968, and the 
Egg Products Inspection Act).
    APHIS regulates the importation of animals and animal products into 
the United States to guard against the introduction of animal diseases, 
including BSE. FSIS is responsible for ensuring the nation's commercial 
supply of meat, poultry, and egg products is safe, wholesome, and 
correctly labeled and packaged, whether produced domestically or 
imported. To ensure the safety of imported products, FSIS maintains a 
comprehensive system of import inspection and controls, which includes 
audits of a region's foreign inspection system, port-of-entry 
reinspection, and annual review of inspection systems of foreign 
countries eligible to export meat and poultry to the United States. 
These two USDA agencies, under their respective authorities, act 
together in the prevention, monitoring, and control of BSE in the U.S. 
livestock and meat and meat products food supply.
    USDA agencies coordinate their responsibilities with FDA's Center 
for Veterinary Medicine regarding safety of animal feed. Likewise, such 
coordination is carried out with the FDA's Center for Food Safety and 
Applied Nutrition regarding the safety of all foods other than meat, 
poultry, and egg products, and with other FDA Centers having 
responsibility for drugs, biologics, and devices containing bovine 
material. These agencies collaborate, issuing regulations under their 
respective, to implement a coordinated U.S. response to BSE.

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Private Testing for BSE
    Issue: Several commenters recommended that private companies be 
provided the opportunity to do their own testing for BSE.
    Response: APHIS has considered carefully the possibility of 
allowing private companies to conduct their own BSE testing, and 
remains convinced that allowing such testing for private marketing 
programs is inconsistent with USDA's mandate to ensure effective, 
scientifically sound testing for significant animal diseases and to 
maintain domestic and international confidence in U.S. cattle and beef 
products. As we continue to deal with the complexities of BSE, we 
consider it important to maintain clarity with regard to the purpose of 
USDA's BSE testing and the results such testing yields. As explained 
previously, currently available post-mortem tests, although useful for 
disease surveillance, are not appropriate as food safety indicators.
User Fees
    Issue: One commenter stated that the $94.00 fee for a permit to 
import animals and products into the United States is unfair to private 
individuals and that there should be a minimal or no fee for permits.
    Response: The issue raised by the commenter pertains to general 
import procedures and is not within the scope of this rulemaking. 
However, with regard to the general issue of user fees, under APHIS' 
regulations, user fees are charged for the services APHIS provides 
related to the importation, entry, or exportation of animals and animal 
products. As provided in 9 CFR part 130, APHIS charges all individuals 
a $94.00 fee for processing an application for a permit to import live 
animals, animal products or byproducts, organisms, vectors, or 
germplasm (embryos or semen) or to transport organisms or vectors. 
These charges are necessary for APHIS to recover the costs of providing 
these services. APHIS does not receive funds appropriated by Congress 
for these activities, and Congress has directed APHIS to charge user 
fees to recover its costs. The $94.00 cost for APHIS'' processing of 
applications for permits to import products was set in August 2001 (66 
FR 39628-39632, Docket No. 99-060-2) based on the average of the actual 
volumes of each type of application processed in fiscal years 1998 and 
1999. The user fee amount includes cost components for the salaries of 
employees involved in the processing applications, along with costs of 
billings and collections, rent, equipment (such as computer 
technologies), Agency overhead, and departmental charges.
Flexibility and BSE Research Advances
    Issue: One commenter recommended that this rule explicitly provide 
administrative flexibility to the Administrator, with the understanding 
that the flexibility granted to the Administrator would be applied on 
the basis of risk assessment and sound science. The commenter stated 
that such an approach would provide for transparent and predictable 
application of the rule, while accommodating the evolution of 
scientific knowledge and risk mitigation processes, new product 
development, market demand, and revisions to OIE standards or WHO 
guidance. Another commenter requested that USDA review the provisions 
in this final rule 2 years after publication to see if technology and 
research advances warrant changes in the regulations. Another commenter 
requested that APHIS reassess the rule in 5 or 10 years.
    Response: We are making no changes based on these comments. In 
developing this rule, we considered the best current BSE research 
available to us and designed the standards for minimal-risk regions to 
provide for some flexibility. We continually evaluate our regulations 
to consider advancement in knowledge and science.
Zero Risk
    Issue: Several commenters disagreed that importations of ruminants 
and ruminant products should be allowed under certain conditions from 
regions that APHIS considers minimal risk for BSE. Some commenters said 
that countries exporting such commodities to the United States should 
present a ``zero risk'' of BSE, not a minimal risk. Even with a zero 
risk standard, said one of these commenters, it would be incorrect to 
say any region is BSE free and that the most that can be said is 
testing has not been conducted for BSE in that region.
    Response: Zero risk is virtually, if not completely, impossible to 
achieve. As noted above, if we were to make trade dependent on zero 
risk, foreign, as well as interstate, trade in animals and animal 
products would cease to exist. APHIS agrees with the conclusion 
expressed in international trade agreements, such as the WTO-SPS 
Agreement and NAFTA, that trade should be commensurate with risk. Under 
these agreements, participating nations, including the United States 
and U.S. trading partners, have agreed to base conditions for 
importations on risk assessment and international standards. Regarding 
the risk associated with regions that have no or inadequate 
surveillance for BSE, we do not currently accept live ruminants or 
ruminant products from these regions, either because they are listed in 
Sec.  94.18 as a BSE-restricted region or because they have not applied 
for status necessary to trade in ruminants or ruminant products with 
the United States, which would involve an evaluation by APHIS of the 
region for other diseases, such as foot-and-mouth disease and 
rinderpest, as well as for BSE.
The Harvard-Tuskegee Study
    Issue: One commenter asked why USDA requested Harvard to conduct a 
risk analysis to evaluate the effectiveness of the U.S. system with the 
presence of Canadian products in U.S. channels, instead of requesting 
that Canada conduct a similar risk assessment of its system.
    Response: As discussed above under the heading ``Harvard-Tuskegee 
Investigation of BSE Risk in the United States,'' in April 1998, USDA 
commissioned Harvard and Tuskegee Universities to conduct a 
comprehensive investigation of BSE risk in the United States. The 
purpose of the Harvard-Tuskegee Study was to assess the effectiveness 
of the U.S. domestic system with regard to BSE. The initial study did 
not specifically address the risk of BSE being introduced into the 
United States from Canada. The study was completed in 2001 and released 
by the USDA. Following a peer review of the Harvard-Tuskegee Study in 
2002, the authors responded to the peer review comments and released a 
revised risk assessment in 2003 (Ref 2).
    In 2003, using the same simulation model developed for the initial 
study, the HCRA evaluated the implications of a then-hypothetical 
introduction of BSE into the United States from Canada (Ref 10). Again, 
this was an assessment of the internal system in the United States, 
rather than an assessment of the risk of BSE in Canada. This assessment 
confirmed the conclusions of the earlier study-namely, that a very low 
risk exists of BSE becoming established or spreading should it be 
introduced into the United States. In December 2002, the CFIA, Science 
Branch, issued a risk assessment that evaluated the risk for BSE in 
Canada. (Ref 12).
J-List
    Issue: One commenter stated that, when the border is opened, we 
should remove Canadian cattle from the ``J-list.''

[[Page 535]]

    Response: The ``J-list'' referred to by the commenter is a list of 
commodities that the Secretary of the Treasury has exempted from the 
general requirement in 19 U.S.C. 1304(a) that all products that are 
imported into the United States be marked as to country of origin. 
Among the commodities excepted by the Secretary of Treasury from this 
requirement are live livestock. The commenter's request is beyond the 
scope of this rulemaking, which does not address U.S. Department of 
Treasury requirements. However, we note that, under this rule, all 
cattle, sheep, and goats imported from Canada for other than immediate 
slaughter must be permanently identified before exportation to the 
United States as being of Canadian origin.
Comments on Issues Outside the Scope of This Rulemaking
    A number of comments raised issues addressed topics outside the 
scope of the provisions of the proposed rule. These comments included 
the following issues: Concern regarding the effect of regulations in 
general on the cost of raising cattle; concern regarding the inhumane 
treatment and shipment of animals; recommendations regarding the 
terminology to use when referring to the euthanization of animals; 
requests for meetings with APHIS officials to discuss product 
development; concern that APHIS appears to be giving the issue of BSE 
minimal-risk regions a higher priority than domestic cattle disease 
programs; prohibiting the lambing of U.S. sheep on pastures where 
scrapie might be a problem; a recommendation that we require cattle 
exported from the United States to Canada to have a USDA identification 
tag and be marked with a brand; a recommendation that all livestock be 
allowed to live out their lives; a recommendation that cattle not be 
slaughtered before 30 months of age and that sheep and goats not be 
slaughtered before 12 months of age; and requests that the Canadian 
government pay U.S. cattle producers for economic and administrative 
losses due to the detection of a BSE-infected cow in Washington State.

V. Additional Clarifications

Transiting of Ruminant Products Through the United States

    We are providing in Sec.  94.18(d) that meat, and edible products 
other than meat, that are eligible for entry into the United States 
from a BSE minimal-risk region may, under certain conditions, be 
transited overland through the United States for export to another 
country.
    The existing regulations in Sec.  94.18(d) have allowed the 
transiting through the United States for immediate export, under 
certain conditions, of meat, and edible products other than meat, that 
are otherwise prohibited importation into the United States because 
they are derived from ruminants that have been in a region listed in 
Sec.  94.18(a) as a region either in which BSE exists or that poses an 
undue risk of BSE. Before our listing Canada in this rule in Sec.  
94.18(a)(3) as a BSE minimal-risk region, the only regions listed in 
Sec.  94.18(a) were countries from which transport of ruminant products 
to and through the United States would necessarily involve shipment by 
air or sea. Therefore, we have interpreted the existing provisions for 
transiting the United States in Sec.  94.18(d) to apply only to such 
transiting at air or sea ports in the United States for export to 
another country. The increased risk from overland shipment would have 
required mitigation measures in addition to those listed in existing 
Sec.  94.18(d).
    Now that BSE has been detected in a country (Canada) from which 
overland shipment of ruminant products is feasible, we consider it 
necessary to clarify our intent with regard to the existing transiting 
provisions in Sec.  94.18(d) to make it clear that transiting of 
shipments otherwise prohibited importation into the United States 
because of a region's BSE status may be done only at air or sea ports 
in the United States. We are revising the wording in Sec.  94.18(d) to 
make this clear.
    However, because we consider Canada to be a region of minimal risk 
for BSE, we are adding provisions to this final rule that will allow 
the overland transiting through the United States of products from BSE 
minimal-risk regions that are derived from bovines, sheep, or goats. 
These conditions appear in Sec.  94.18(d) of this final rule and 
require that, in addition to meeting the existing transiting conditions 
in Sec.  94.18(d), such shipments must meet additional conditions that 
are set forth in Sec.  94.18(d)(5), which provide that the shipment 
must be exported from the United States within 7 days of its entry, the 
commodities must not be transloaded while in the United States, and a 
copy of the import permit required under the transiting conditions must 
be presented to the Federal inspector at the port of arrival and the 
port of export in the United States.
    A reasonable question would be: ``If products are eligible for 
entry into the United States from a BSE minimal-risk region, why is it 
necessary to establish conditions for their transiting through the 
United States?'' The reason for restricting overland transiting to low-
risk products from BSE minimal-risk regions is that shipments for 
controlled transit are not intended for ultimate entry into the United 
States and generally do not need the same manner of border inspection 
as shipments intended for U.S. entry. In recognition of this, we are 
combining the existing transiting requirements and those of this final 
rule with limitations on the type of products eligible for transiting 
to further ensure that such products do not present a risk of 
introducing BSE into the United States.
    Part 95, which deals with the importation of inedible products, has 
provisions in Sec.  95.4(f) that are similar to those in Sec.  94.18(d) 
regarding transiting of products. In this final rule, we are making the 
same changes to Sec.  95.4 as those discussed above with regard to 
Sec.  94.18(d).

Definition of Inspector

    Sections 93.400 and 95.2 each contain a definition of inspector. 
Section 94.0 contains a definition of authorized inspector. These 
definitions refer to an individual responsible for certain functions at 
a port of arrival or export in the United States. Each of the 
definitions refers to an individual either employed by APHIS or 
authorized by the Administrator to enforce the regulations. However, 
these definitions do not reflect the reassignment of certain 
responsibilities from APHIS to the Department of Homeland Security's 
Bureau of Customs and Border Protection by the Homeland Security Act of 
2002. Therefore, we are replacing the definitions of inspector and 
authorized inspector in those sections with new definitions that read 
as follows: ``Any individual authorized by the Administrator of APHIS 
or the Commissioner of Customs and Border Protection, Department of 
Homeland Security, to enforce the regulations in this part.'' 
Similarly, we are updating Sec. Sec.  94.18(d)(3) and 95.4(f)(3) (which 
is redesignated as Sec.  95.4(h)(3) in this final rule), which have 
required notification of the APHIS Plant Protection and Quarantine 
Officer at ports of arrival and export, to refer instead to 
notification of the inspector. We are also adding the definition of 
authorized inspector to Sec.  96.1 to clarify the use of that term in 
part 96 of the regulations.

Definition of Flock

    Before this final rule, the term flock was defined in Sec.  93.400 
to mean ``a herd.'' However, 9 CFR part 93, subpart D, includes 
provisions that refer to a ``flock or herd.'' To eliminate this 
redundancy and to clarify our intent, we

[[Page 536]]

are a making a nonsubstantive change to Sec.  93.400 to define flock as 
``a group of one or more sheep maintained on common ground; or two or 
more groups of sheep under common ownership or supervision on two or 
more premises that are geographically separated, but among with there 
is an interchange or movement of animals.'' This definition is the same 
as the existing definition of herd in Sec.  93.400, except that the 
revised definition of flock refers specifically to sheep.

Wording Clarification

    We are also amending Sec.  94.18(a)(1) to make it clear that 
imports of ruminants and ruminant products from Canada are not subject 
to the restrictions of that paragraph.

Executive Order 12866 and Regulatory Flexibility Act

    This rule has been reviewed under Executive Order 12866. The rule 
has been determined to be economically significant for the purposes of 
Executive Order 12866 and, therefore, has been reviewed by the Office 
of Management and Budget.
    Under the Animal Health Protection Act of 2002 (7 U.S.C. 8301 et 
seq.) the Secretary of Agriculture is authorized to promulgate 
regulations to prevent the introduction into the United States or 
dissemination of any pest or disease of livestock.
    The regulations in 9 CFR parts 93 to 96 include provisions that 
prohibit the importation of ruminants and most ruminant products (meat 
and certain other products and byproducts) from (1) regions where BSE 
exists and (2) regions that present an undue risk of introducing BSE 
into the United States because of import requirements less restrictive 
than those that would be acceptable for import into the United States 
or because of inadequate surveillance.
    In this rule, APHIS is establishing an additional category of 
regions that present a minimal risk of introducing BSE into the United 
States. This category will include (1) those regions in which a BSE-
infected animal has been diagnosed but in which measures have been 
taken that reduce the risk of BSE being introduced into the United 
States, and (2) those regions in which BSE has not been detected, but 
that cannot be considered BSE-free. In this rule, APHIS (1) sets forth 
the standards the Agency will consider before listing a region as one 
of minimal risk for BSE, (2) lists Canada as the only BSE minimal-risk 
region at this time, and (3) establishes measures to mitigate any risk 
that BSE would be introduced into the United States through the 
importation of ruminants and ruminant products from a BSE minimal-risk 
region. Future requests received from other regions to be considered 
BSE minimal-risk regions will be evaluated.
    On May 20, 2003, CFIA reported a case of BSE in a beef cow in 
northern Alberta. To prevent the introduction of this disease into the 
United States, APHIS issued an interim rule that listed Canada as a 
region where BSE exists, thereby prohibiting the importation of 
ruminants and most ruminant products from Canada, effective May 20, 
2003.
    Following the discovery of the BSE-infected cow, Canada conducted 
an epidemiological investigation of the BSE occurrence, and took action 
to guard against any spread of the disease, including the quarantining 
and depopulation of herds and animals determined to be possibly at risk 
for BSE. Subsequently, Canada asked APHIS to consider resumption of 
ruminant and ruminant product imports into the United States, based on 
information regarding the following: Canada's veterinary 
infrastructure; disease history; practices for preventing widespread 
introduction, exposure, and/or establishment of BSE; and measures taken 
following detection of the disease.
    The prohibition was modified on August 8, 2003, to allow the 
importation of certain ruminant-derived products from Canada under 
APHIS Veterinary Services permit. The most important commodity that can 
enter by permit is boneless bovine meat from cattle less than 30 months 
of age.
    This study analyzes ruminant and ruminant product imports from 
Canada that will be allowed to resume because of this rule. Expected 
benefits and costs are examined in accordance with requirements of the 
Office of Management and Budget for benefit-cost analysis as described 
in Circular A-4, ``Regulatory Analysis,'' which provides guidance for 
agencies on the analysis of economically significant rulemakings as 
defined by Executive Order 12866. Effects on small entities are also 
considered, as required by the Regulatory Flexibility Act.
    Although not addressed in the analysis, Canadian producers and 
suppliers of ruminants and ruminant products will clearly benefit from 
the resumption of exports to the United States. In 2002, about 90 
percent of Canadian beef exports and virtually all (99.6 percent) of 
Canada's cattle exports were shipped to the United States. Canada's 
cattle producers reportedly had one million more head of cattle on 
their farms on July 1, 2004, than they did one year earlier. This 
increase is largely due to the collapse of Canadian cattle exports.
    Below is a summary of our economic analysis. A copy of the full 
economic analysis is available by contacting the individual listed 
under FOR FURTHER INFORMATION CONTACT. You may also view the economic 
analysis on the Internet by accessing the APHIS Web site at http://www.aphis.usda.gov/lpa/issues/bse/bse.html. Click on the listing for 
``Economic Analysis, Final Rule, Bovine Spongiform Encephalopathy: 
Minimal-Risk Regions and Importation of Commodities (APHIS Docket No. 
03-080-3.)''
    The commodities that will be allowed to be imported from Canada 
under specified conditions under this final rule can be summarized as:
     Bovines, as long as they are slaughtered at less than 30 
months of age, and as long as those bovines not imported for immediate 
slaughter are moved to a single feedlot before slaughter;
     Sheep and goats (ovines and caprines), as long as they are 
slaughtered at less than 12 months of age, and provided sheep and goats 
not imported for immediate slaughter are moved to a single designated 
feedlot before slaughter;
     Cervids of any age;
     Camelids (i.e., llamas, alpacas, guanacos, and vicunas);
     Meat from bovines, ovines, and caprines; and
     Certain other products and byproducts, including bovine 
livers and tongues, gelatin, and tallow.

Model and Assumptions

    Cattle and beef imports comprise 99 percent of the value of 
commodities that will be allowed entry from Canada because of this 
rulemaking, and they are therefore the focus of the analysis. The model 
used is a net trade partial equilibrium welfare model. Net trade is 
defined as the absolute value of the difference between exports and 
imports. Individual country trade with the United States is not 
modeled. Non-spatial means that price and quantity effects resulting 
from geographic differences in market locations are not included. 
Therefore, price and quantity effects obtained from the model are 
assumed to be the average of effects across geographically separated 
markets. Partial equilibrium means that the model results are based on 
maintaining a commodity-price equilibrium in a limited portion of the 
overall economy.
    Economic sectors not explicitly included in the model are assumed 
to have a negligible effect on the model

[[Page 537]]

results. Welfare refers to benefits or losses to society, as measured 
by changes in consumers' willingness to pay for commodities beyond 
their actual price (a measure of utility known as consumer surplus) and 
changes in producers' revenue beyond their variable costs (a measure of 
returns to fixed investment known as producer surplus).
    This quantitative economic modeling approach is appropriate because 
the rule changes are specific to the U.S. cattle and beef sectors, are 
focused in extent, and have only limited extensions into non-
agricultural sectors of the economy. A disadvantage of the model is the 
lack of linkages between the cattle production and beef processing 
sectors. This disadvantage is addressed through the presentation of 
results from an agricultural multi-sector model that recognizes such 
linkages.
    We estimate effects of additional supplies to the United States of 
fed cattle and feeder cattle, due to resumption of imports from Canada. 
The additional quantities of cattle, all things equal, will cause 
prices to fall. The model indicates the expected price decline and the 
increase in quantity demanded and decrease in domestic production/
supply that will occur in response to the fall in price. Summing 
welfare gains for consumers/buyers and losses for producers/ suppliers 
(changes in consumer and producer surplus) yields estimated net 
benefits for the United States. For beef, we expect a small decline in 
imports from Canada with the rule due to the replacement of beef 
produced from fed cattle by beef produced from cows, as explained 
below. Estimated effects for beef are in the opposite direction from 
those for cattle, with losses for U.S. consumers/buyers outweighing 
gains for U.S. producers/suppliers. The effects for beef are much 
smaller than the effects for cattle.
    Cattle imports from Canada. There are three components to the 
number of cattle under 30 months of age that are expected to be 
imported from Canada: A quantity that would be imported normally, a 
quantity that would have entered if cattle imports from Canada were not 
prohibited (termed the backlog); and a quantity of fed cattle that 
would be expected to be displaced from slaughter in Canada by increased 
cow slaughter for the export of processing beef to the United States.
    For the first component, the quantities of fed and feeder cattle 
that would enter normally are based on average imports for 2001 and 
2002: About 652,400 fed cattle and about 311,400 feeder cattle in 2005, 
with somewhat lesser quantities in years 2006-2009 because of assumed 
expanded slaughter capacity in Canada.
    The backlog is the additional Canadian cattle that may have 
accumulated due to the closing of the border to live ruminant imports 
in May 2003. Importation of the backlog or some fraction of it would 
begin as soon as the rule is in effect, with most of these fed and 
feeder cattle expected to enter in 3 to 6 months.
    Calculation of the size of the backlog is based on the change in 
Canada's cattle inventory from July 2003 to July 2004. The backlog may 
include about 394,500 fed cattle under 30 months of age and about 
204,000 feeder cattle. The backlog of cattle over 30 months of age (not 
eligible for importation under the rule) numbers about 462,500 head.
    The third component of expected cattle imports, an additional 
supply of fed cattle derives from another change included in the rule-
namely, removal of the requirement that beef imported from Canada come 
from cattle slaughtered at less than 30 months of age. We expect this 
change to result in a large increase in cow slaughter in Canada for the 
export of processing beef to the United States. We discuss these 
expected effects here in greater detail.
    Our assumptions regarding (1) the shift in Canada from slaughter of 
fed cattle under 30 months of age to slaughter of cattle (principally 
cows) over 30 months of age, for the export of processing beef to the 
United States, and (2) the shipment to the United States of the fed 
cattle under 30 months of age not slaughtering in Canada, are based on 
relative prices and margins in the two countries for fed cattle, cows, 
fed beef, and processing beef. As of mid-November 2004, a Canadian 
packer could buy a cow for about US$17 per cwt and sell the processing-
grade beef for about US$123 per cwt. The packer also could buy a fed 
steer or heifer at about US$67 per cwt and sell the beef for about 
US$132 per cwt. In the United States, the cow would cost a packer about 
$55 per cwt and the beef would sell for about $125 per cwt; a fed steer 
or heifer would cost about $85 per cwt and the beef would sell for 
about $135 per cwt.
    Although differences in weights and dressing percentages do not 
permit the direct comparison of live animals to dressed meat, the 
difference between the relative purchase prices to sales prices 
indicate that the margin buying cows and selling processing beef is 
much larger for a Canadian packer than it is for a U.S. packer. 
Canadian packers are prevented from taking greater advantage of this 
large margin by Canada's relatively small market for cow beef. Canadian 
production of processing beef has already displaced much of Canada's 
imported product. Without a larger demand, increased production would 
cause the Canadian price of processing beef to decline sharply.
    The United States is already providing Canada with additional 
demand for beef from fed cattle, through the importation of boneless 
beef under permit from cattle slaughtered at less than 30 months of 
age. The United States, in a sense, is currently importing Canada's 
surplus production of fed beef. Allowing the United States to import 
Canadian beef from cattle slaughtered at more than 30 months of age 
would enable Canada to produce and sell much larger quantities of 
processing beef without fearing the significant price collapse that 
would likely occur if the entire additional product were only for the 
Canadian market.
    This is not to say that the price of processing beef or cow prices 
in the United States would not decline from their current levels due to 
the supply from Canada, but we would not expect a sharp decline. Two 
facts concerning the U.S. supply of processing beef underlie this 
reasoning. First, U.S. cow slaughter is forecast to decline in 2005, as 
producers begin to rebuild herds that have been characterized by 
diminishing cow inventories for several years. Second, cow retention 
for herd rebuilding is also expected to take place in Australia and New 
Zealand, major sources of processing beef for the United States. Their 
beef exports are forecast to remain largely unchanged in 2005. As long 
as principal Asian markets continue to prohibit entry of U.S. beef, any 
increase in imports of beef from Australia and New Zealand by these 
markets may limit the supply of beef from Australia and New Zealand 
into the United States.
    With the rule, entry of Canadian steers and heifers is expected to 
result in steer and heifer prices in the two countries becoming more 
similar. For example, in 2002, fed steer prices in Alberta averaged 
about US$63 per cwt, while in the United States, the Nebraska Direct 
Choice steer price averaged about $67 per cwt. Given the difference in 
mid-November 2004 prices for fed cattle, $67 per cwt in Canada and $85 
per cwt in the United States, shipment of fed cattle to the United 
States will be an attractive alternative for Canadian producers, at 
least until Canadian prices rise to the level of U.S. prices (adjusted 
for grade differentials and minus transportation and transaction 
costs).
    Prices for slaughter cows in the two countries are expected to 
continue to differ because Canadian cattle more

[[Page 538]]

than 30 months of age will not be allowed entry by the rule, despite a 
ready market for them at slaughter facilities located in the Northern 
United States. Thus, in the absence of trade in those cattle, the 
backlog of cattle over 30 months of age will remain until increased cow 
slaughter in Canada reduces their inventory. We would expect the price 
of cows in Canada to increase as slaughter increases in response to 
opportunities to export beef from cattle more than 30 months of age to 
the United States. However, the margin earned from slaughtering cows in 
Canada and exporting the processing beef to the United States is likely 
to remain favorable (though decreasingly so as Canada's backlog of 
cattle more than 30 months of age is reduced).
    It is assumed that the Canadian slaughter sector is operating at 
full capacity. Key to assumptions underlying this analysis is the 
willingness of Canadian slaughter facilities to add cow slaughter 
shifts or days to their operations at the expense of steer and heifer 
slaughter. We believe they would want to do so, given the price 
differentials in Canada and the United States and the opportunity for 
Canadian beef exports to the United States from cattle slaughtered at 
more than 30 months of age. With the rule, beef imported from Canada 
would no longer be required to come from a slaughter facility that 
either slaughters only cattle less than 30 months of age or complies 
with an approved segregation process, which may permit increased 
flexibility in scheduling cow slaughter.
    In 2005, APHIS expects this shift by Canada to exports of 
processing beef and additional fed cattle to the United States to take 
place throughout the year, not during one or two quarters as assumed 
for the backlog of steers and heifers under 30 months of age. Beyond 
2005, additions to Canadian slaughter capacity are expected to allow 
increased slaughter of cattle of all ages. Canada has been able to 
increase its slaughter numbers during the past year, but the opening of 
new plants and major expansion of current processing facilities to 
accommodate increased cow slaughter will likely take some years. The 
lack of excess slaughter capacity in Canada and the described price 
differentials are the basis for the assumed shift to increased cow 
slaughter in Canada for the production of processing beef for export to 
the United States, and the assumed additional imports of Canadian fed 
cattle.
    In 2005, the maximum number of imported fed cattle displaced from 
Canadian slaughter may equal the backlog of cattle over 30 months of 
age (assumed to be slaughtered for the export of processing beef to the 
United States), about 460,000 head. For years 2006-2009, we assume the 
number of fed cattle displaced from slaughter in Canada and exported to 
the United States to decline, as Canada's slaughter capacity increases 
and Canada's cow prices trend upward. However, all things equal, as 
long as live cattle imports from Canada are limited to animals less 
than 30 months of age and the U.S. demand for processing beef is high, 
beef imports from Canadian cow slaughter may be favored.
    Uncertainty surrounds both the assumed backlog quantities and the 
quantity of fed cattle expected to be displaced by cows slaughtered in 
Canada and exported to the United States. We acknowledge these 
uncertainties by also conducting the analysis using one-half of the 
assumed backlog and one-half of the assumed number of displaced fed 
cattle.
    After the backlog of cattle has been imported, imports of cattle 
under 30 months of age from Canada are expected to continue at historic 
levels elevated by the importation of the fed cattle displaced from 
Canadian slaughter by the slaughter of cows. We therefore expect the 
largest impact of the rule to occur during the first 3 to 6 months that 
the rule is in effect. In order to assess these very near-term price 
impacts, we estimate effects of the rule for the first and second 
quarters of 2005, in addition to the five-year analysis of welfare 
effects. As in the analysis of welfare impacts, we acknowledge 
uncertainty about the quantity of cattle what will enter from Canada by 
conducting a sensitivity analysis of near-term price effects using one-
half of the assumed backlog and one-half of the assumed number of 
displaced fed cattle.
    Beef imports from Canada. Boneless beef entering from Canada under 
permit represents a large share of historic beef imports from Canada. 
Before the Alberta BSE discovery, Canada's share of U.S. beef imports 
was about 41 percent (90 percent of fresh/chilled beef imports and 4 
percent of frozen beef imports). Currently, Canada's share of U.S. beef 
imports is about 32 percent (fresh/chilled beef, 85 percent; frozen, 3 
percent). For this reason alone, the effect of the rule for beef 
imports will be much smaller than the effect for cattle imports. 
Canadian beef entering the United States by permit is included in the 
baseline for the analysis.
    As described, we expect Canadian cows to be slaughtered in place of 
fed cattle for the export of processing beef to the United States, 
given Canada's limited capability to increase its slaughter capacity in 
the short term. A cow that is slaughtered produces less meat than a fed 
steer or heifer due to a lighter weight and lower dressing percentage. 
Recent statistics from Canada indicate an average difference in beef 
produced from one steer/heifer and one cow of 150 pounds. In 2005, 
assuming Canada is fully utilizing all available slaughter capacity, 
the decrease in beef production would total about 69 million pounds if 
the backlog of about 460,000 cattle over 30 months of age is 
slaughtered in place of steers and heifers. To take into consideration 
possible declines in Canada's domestic consumption of beef as beef 
prices rise slightly relative to other meats, and therefore movement of 
beef from the domestic to export markets, we reduce the decline of 69 
million pounds by one-third, to 46 million pounds.
    The forecast for Canada's beef exports worldwide in 2005 is 570,000 
metric tons. U.S. imports of beef from Canada are forecast to equal 
about 86 percent of Canada's total beef exports, or about 490,200 
metric tons. The 490,200 metric tons is equivalent to 1,081 million 
pounds. In other words, Canada's beef exports to the United States, 
compared to what would have been exported without this rule, can be 
expected to decline in 2005 by 4.3 percent (46 million pounds divided 
by 1,080 million pounds) because of the displacement of steer/heifer 
slaughter by cow slaughter in Canada. The decrease in Canadian beef 
exports to the United States because of this displacement is assumed to 
diminish in years 2006-2009, as Canada's slaughter capacity expands.
    Processing-grade beef is not perfectly substitutable for fed beef. 
The two commodities compete in different but closely related markets. 
This distinction is not included in the analysis because the model is 
based on aggregate beef price ranges and elasticities. Increased 
supplies of processing beef are expected to compete with fed beef in 
the same fashion as other close substitutes. Thus, allowing imports of 
beef from cattle slaughtered at over 30 months of age, together with 
fed cattle imports augmented by the cattle displaced from Canadian 
slaughter, is expected to result in lower prices for U.S. steers and 
heifers.
    As with the assumed backlog and displaced fed cattle imports, there 
is uncertainty as to the amount of beef from Canadian cow slaughter 
that will be imported by the United States. Accordingly, we include in 
the sensitivity analysis a reduction by one-

[[Page 539]]

half of the assumed change in beef imports from Canada. In 2005, for 
example, this reduced amount would represent a decrease in beef imports 
from Canada of 2.1 percent from what would have been imported without 
the rule.

Welfare and Near-term Price Effects of the Rule for Cattle and Beef

    Welfare effects. Welfare effects of the rule for cattle and beef 
are summarized in Table 1. Present values and annualized values of 
welfare gains and losses over the five-year period 2005-2009, are 
determined using 3 percent and 7 percent discount rates, in both 2005 
and 2001 dollars.

  Table 1.--Present and Annualized Value Estimations of Effects of the Rule for Fed Cattle, Feeder Cattle, and
                Beef, Discounted at 3 Percent and 7 Percent, in 2005 and 2001 Dollars, 2005-2009
----------------------------------------------------------------------------------------------------------------
                                                                            Changes in welfare (per thousand
                                                             Discount                   dollars)
                          Value                                rate    -----------------------------------------
                                                            (percent)     Consumer      Producer         Net
----------------------------------------------------------------------------------------------------------------
Present, 2005 dollars....................................            3   $2,982,088     -$2,907,462      $74,626
                                                                     7    2,592,201      -2,525,852       66,349
Present, 2001 dollars....................................            3    2,810,618      -2,740,283       70,335
                                                                     7    2,443,150      -2,380,616       62,534
Annualized, 2005 dollars.................................            3      651,153        -634,858       16,295
                                                                     7      632,214        -616,032       16,182
Annualized, 2001 dollars.................................            3      613,711        -598,353       15,358
                                                                     7      595,861        -580,610      15,251
----------------------------------------------------------------------------------------------------------------
Note: The present and annualized values are taken from Appendix H, based on assumed import of the backlog,
  import of fed cattle displaced from slaughter in Canada by increased cow slaughter for the export of
  processing beef to the United States, and beef imports from cows slaughtered in place of fed cattle.

    The present value of the net benefit of the rule for cattle and 
beef is estimated to range in 2005 dollars between $66.3 million and 
$74.6 million, depending on the discount rate used. Over the five-year 
period, the annualized value of the net benefit in 2005 dollars, 
depending on the discount rate, ranges between $16.2 million and $16.3 
million.
    The largest effects for cattle are expected to occur in 2005, when 
the backlog would be imported and the displacement of fed cattle 
slaughter by cow slaughter would be largest. The impact for fed cattle 
would be greater than for feeder cattle because of the larger number of 
fed cattle expected to be imported. For fed cattle, the annual price 
declines may range from an average of 3.2 percent in 2005 to 1.3 
percent in 2009. For feeder cattle, the price declines range from an 
average of 1.3 percent in 2005 to 0.6 percent in 2009.
    Estimated net benefits in 2005 for fed cattle are estimated to 
range from $25.0 million to $26.9 million, and for feeder cattle, from 
$10.4 million to $11.0 million. In each successive year, the net 
benefits are expected to become smaller, such that by 2009 they may 
range for fed cattle from $3.8 million to $4.3 million, and for feeder 
cattle, from $4.3 million to $4.8 million.
    Effects of the rule for beef attributable to the change in beef 
imports from Canada are expected to be much smaller than those for 
cattle. For example, the expected 2005 net welfare loss (because of the 
decline in imports due to cow slaughter replacing fed cattle slaughter) 
in 2005 dollars is estimated to range between $94,000 and $98,000. 
Average percentage increases in price may range from 0.09 percent in 
2005 to 0.01 percent in 2009, suggesting nearly negligible impacts. If 
the beef-equivalent of the fed and feeder cattle imported from Canada 
is considered, the supply of beef in the United States increases and 
the price of beef decreases by 1 to 2 percent from 2005 baseline 
levels. Smaller decreases from baseline projections would occur after 
2005 because the volume of imported animals declines.
    Effects may be even smaller for U.S. producers than these 
percentages indicate, given that nearly all U.S. beef imports from 
countries other than Canada consist of processing beef. Demand for 
imported processing beef has increased drastically as ground beef sales 
continue at a robust pace. At the same time, U.S. production of 
processing beef has fallen to record lows because of the cyclical 
decline in cow slaughter.
    Table 2 shows the results of the sensitivity analysis, assuming 
importation of one-half of the backlog, one-half of the fed cattle 
expected to be displaced from slaughter in Canada, and one-half of the 
expected replacement of fed cattle beef imports derived from fed cattle 
by beef imports derived from cows. The present value of the net benefit 
for cattle and beef in this case is estimated to range in 2005 dollars 
between $48.9 million and $56.1 million, depending on the discount rate 
used. Over the five-year period, the annualized value of the net 
benefit in 2005 dollars, depending on the discount rate, may range 
between $11.9 million and $12.3 million--that is, about three-fourths 
of the expected annualized net benefit with the rule.

 Table 2.--Sensitivity Analysis Based on Reduced Import Quantities: Present and Annualized Value Estimations of
 Effects of the Rule for Fed Cattle, Feeder Cattle, and Beef, Discounted at 3 Percent and 7 Percent, in 2005 and
                                             2001 Dollars, 2005-2009
----------------------------------------------------------------------------------------------------------------
                                                          Discount    Changes in welfare (per thousand dollars)
                         Value                              rate    --------------------------------------------
                                                         (percent)     Consumer        Producer          Net
----------------------------------------------------------------------------------------------------------------
Present, 2005 dollars.................................            3   $2,571,323        -$2,515,180      $56,144
                                                                  7    2,211,115         -2,162,168       48,947
Present, 2001 dollars.................................            3    2,423,472         -2,370,557       52,915
                                                                  7    2,083,976         -2,037,844       46,132

[[Page 540]]

 
Annualized, 2005 dollars..............................            3      561,460           -549,201       12,259
                                                                  7      539,270           -527,333       11,938
Annualized, 2001 dollars..............................            3      529,176           -517,622       11,554
                                                                  7      508,262           -497,011      11,251
----------------------------------------------------------------------------------------------------------------
Note: The present and annualized values are midpoints taken from Appendix I, based on assumed imports of one-
  half of the backlog, one-half of the fed cattle numbers, and one half of the replacement of fed cattle beef
  imports by cow beef imports.

    In this scenario, the impact in 2005, in particular, would be 
smaller because of the fewer cattle imported. For fed cattle, the 
annual price declines may range from 2.3 percent in 2005 to 1.2 percent 
in 2009. For feeder cattle, the price declines over the five-year 
period may average 0.7 percent. Estimated net benefits in 2005 for fed 
cattle may range from $12.9 million to $13.9 million, and for feeder 
cattle, from $8.0 million to $8.5 million. In each successive year, the 
net benefits are expected to become smaller, such that by 2009 they may 
range for fed cattle from $3.5 million to $3.9 million, and for feeder 
cattle from $4.3 million to $4.8 million.
    The estimated percentage decrease in the price of fed cattle, if 
one-half of the backlog and one-half of the fed cattle expected to be 
displaced from slaughter in Canada were imported, would be about 1 
percent less than when we assume importation of the full backlog and 
full quantity of displaced fed cattle (2.3 percent decrease compared to 
a 3.2 percent decrease). For feeder cattle, the difference in the 
effect is smaller in absolute terms, but larger in relative terms (0.6 
percent decrease compared to a 1.3 percent decrease). In both cases the 
effects are expected to diminish over the five-year period.
    Near-term price effects. As expected, price effects are larger when 
the backlog is assumed to enter in one quarter rather than two 
quarters, and are larger for fed cattle than for feeder cattle, given 
the larger number of fed cattle expected to be imported. For example, 
for fed cattle, the decrease in price when the backlog is assumed to 
enter entirely within one quarter is estimated to be 5.4 percent, 
assuming a price elasticity of supply of 0.61 and a price elasticity of 
demand of -0.76. When the backlog of fed cattle is assumed to enter 
over two quarters using the same price elasticities, the decline in 
price is estimated to be 3.8 percent. Entry of the backlog of feeder 
cattle over the two quarters could result in price declines of 1.9 
percent, for the same elasticities, compared to a possible price drop 
of 3.3 percent when the enter entirely within one quarter.
    The less elastic the price elasticities (the less responsive 
sellers and buyers are to price changes), the larger the expected 
percentage changes in price. When the supply and demand elasticities 
are halved (supply elasticity of 0.30 and demand elasticity of -0.38), 
for example, and fed cattle are assumed to enter within two quarters, 
the decrease in price could be 4.8 percent, compared to a price 
decrease of 3.8 percent when a supply elasticity of 0.61 and demand 
elasticity of -0.76 are used.
    When the assumed backlog and assumed number of imported fed cattle 
displaced from Canadian slaughter are halved as a sensitivity analysis, 
the near-term price effects are found to be smaller overall, with the 
smaller elasticities again yielding larger price decreases. For 
example, the percentage decrease in price for fed cattle entering over 
two quarters is estimated to be 2.5 percent for a supply elasticity of 
0.61 and a demand elasticity of -0.76 (compared to a 3.8 percent price 
decline when the full backlog and number of displaced fed cattle are 
imported). If the supply elasticity were 0.30 and the demand elasticity 
were -0.38, the price decline is estimated to be 3.2 percent (compared 
to 4.8 percent for the full cattle import numbers). Similarly, smaller 
percentage price declines are observed for feeder cattle when in the 
sensitivity analysis the backlog and the number of imported fed cattle 
displaced from Canadian slaughter are halved.

Other Impacts of the Rule

    We consider other effects of the rule besides those estimated for 
cattle and beef, including: The results of an agricultural multi-sector 
analysis; costs that may be incurred in monitoring the movement of 
imported Canadian feeder ruminants; effects for ruminant products other 
than cattle and beef; and possible effects of the rule on U.S. exports.
    Multi-sector analysis. Some commenters on the analysis for the 
proposed rule emphasized the integrated structure of the cattle and 
beef processing industries, and noted potential effects of the rule on 
other sectors of the economy. APHIS agrees that a multi-sector analysis 
can capture industry interactions that are missing from single-sector 
analyses. We therefore report the results of an analysis based on a 
model that includes the animal feed, animal production, and animal 
product processing sectors.
    While the major vertically linked marketing channels are included 
in this model, effects of the rule farther downstream in the economy 
are not modeled. For example, economic benefits to surrounding 
communities of increased employment in slaughter plants receiving 
greater supplies of cattle due to reopening of the Canadian border are 
not captured by the model, nor are similar economic losses resulting 
from reduced spending in communities by cattle producers due to 
reductions in their returns. These effects are believed to be very 
small on a national basis, but may show some geographic concentration.
    The multi-sector analysis simulates percentage changes in prices 
and gross revenues (price multiplied by the quantity sold) using the 
assumed 2005 range of imported Canadian cattle (roughly 1.5 million to 
2 million head, fed and feeder cattle combined). The results of the 
analysis show for the combined livestock, feed, and grain sectors, a 
possible decline in gross revenues of 1.4 percent to 1.7 percent. For 
the beef and cattle sectors, the gross revenue declines may range from 
1.3 percent to 1.6 percent, and from 3.9 percent to 4.8 percent, 
respectively.
    With respect to the change in the price of cattle in 2005, the 
multi-sector analysis indicates a possible decline of between 3.3 
percent and 4.1 percent, compared to 2005 price declines estimated in 
the single-sector analyses of between 0.6 percent and 1.3 percent

[[Page 541]]

for feeder cattle, and between 2.3 percent and 3.2 percent for fed 
cattle. To the extent that sector interactions result in expanded 
effects as indicated by these relative price declines, welfare gains 
and losses will be larger than are indicated in Table 1. The multi-
sector model simulates price and revenue changes, but does not yield 
measures of welfare change. However, this model does indicate a decline 
in consumer expenditures by about 1 percent, a finding that supports 
the estimated consumer welfare gains attributable to the rule.
    The multi-sector analysis also examines possible effects if beef 
consumption in the United States were to decline by 2 percent because 
of consumers' perception of increased risk of BSE with the rule. 
Compared to the assumption of no consumer response, this scenario shows 
that there would be a decline in beef and cattle prices by an 
additional 0.2 percent to 0.4 percent, causing gross revenues for the 
beef and cattle sectors to fall by an additional 0.2 percent to 0.5 
percent.
    A third scenario considered in the multi-sector analysis is partial 
restoration of beef exports to Japan, such that U.S. beef exports in 
2005 would double, from an expected 0.3 million metric tons to 0.6 
million metric tons. In this instance, gross revenue for the cattle 
sector (assuming 1.5 million head of Canadian cattle are imported) 
could decline by 1.7 percent, compared to a possible decrease of 3.9 
percent assuming no change in U.S. beef exports. For the beef sector, 
gross revenue losses of 1.3 percent may become gains of 2.2 percent 
because of the exports to Japan. For both sectors, increased U.S. 
exports could moderate by at least one-half the price declines due to 
resumption of cattle imports from Canada.
    Monitoring the movement of feeder cattle. Movement within the 
United States of feeder cattle (and feeder lambs and goats) imported 
from a BSE minimal-risk region such as Canada--from the U.S. port of 
entry to a feedlot and from the feedlot to slaughter--will require that 
certain inspection and record keeping safeguards be satisfied. The 
increased cost of these requirements is considered a cost to this 
rulemaking. These include certification of each animal's identification 
(by eartag and branding), age, and feeding history. Feeder cattle will 
be listed on the APHIS Form VS 17-130 that accompanies the animals from 
the port of entry and on the APHIS Form VS 1-27 that accompanies the 
animals to slaughter.
    Costs of the process can be approximated by considering the time 
Federal or State officials or their designees would spend monitoring 
the movement of these cattle. We approximate the cost of performing the 
inspections and related tasks to be $10 per animal, based on direct 
salary, personnel benefits, administrative support costs, agency 
overhead, and departmental charges, and using a simplified example 
developed by APHIS Veterinary Services. Given the number of feeder 
cattle that may enter because of the rule, the overall cost in 2005 
would be between $4.1 million and $5.2 million
    Commodities other than cattle and beef. Other, less major 
commodities that will be allowed entry under the rule and for which we 
have data are sheep, goats, and farmed cervids; meat from these 
ruminants; and bovine tongues and livers. In all cases, reestablished 
imports from Canada will have small effects on the U.S. supply of these 
commodities and the welfare of U.S. entities. Feeder lambs and goats 
will be required to be moved to designated feedlots. As with feeder 
cattle from Canada, movement of feeder lambs and goats from the port of 
entry to feedlot and from feedlot to slaughter will be monitored, which 
will lead to a small cost.
    U.S. exports. The rule, of course, will have no immediate effect 
for U.S. exports to countries that currently prohibit beef imports from 
the United States. It could influence these countries' future decisions 
regarding resumption of beef imports from the United States. A country 
may consider the rule to lend justification to a decision to continue 
to prohibit entry of U.S. beef because of concern about BSE risks posed 
by Canadian cattle, even though there would be no scientific basis. In 
such a case, there would be continued premium losses over and above the 
domestic value of the products, especially for beef variety meats. On 
the other hand, resumption of U.S. imports from Canada may help 
convince other countries of the sanitary safety of both U.S. and 
Canadian beef. Any effects the rule may have for future U.S. beef 
exports may vary from one trading partner to another.

Alternatives to the Rule

    Alternatives to the rule would be to leave the regulations 
unchanged--that is, continue to prohibit entry of ruminants and most 
ruminant products from regions of minimal BSE risk (other than products 
allowed entry under permit), or modify the commodities and/or import 
requirements specified in the rule. By maintaining current import 
restrictions, the net benefits of reestablishing imports from Canada of 
fed and feeder cattle, and beef not by permit, and other affected 
commodities would not be realized. Two possible modifications would be 
to (i) require that imported beef come from cattle slaughtered at less 
than 30 months of age, or (ii) continue to prohibit the entry of live 
ruminants.
    Beef only from cattle less than 30 months of age. The proposed rule 
would have required beef imports from Canada to come from cattle 
slaughtered at less than 30 months of age. In a notice that reopened 
the comment period for the proposed rule, APHIS stated that it no 
longer believed that it would be necessary to require that beef 
imported from BSE minimal-risk regions be derived only from cattle less 
than 30 months of age, provided measures are in place to ensure that 
SRMs are removed when the animals are slaughtered, and that such other 
measures as are necessary are in place. Canada is removing SRMs at 
slaughter and fulfilling other required measures.
    Requiring that beef come only from cattle slaughtered at less than 
30 months of age would continue the prohibition on Canadian cows and 
bulls as source animals, and eliminate effects of the rule for beef. 
Continuing to limit imports from Canada to veal from calves and beef 
from steers and heifers would cause Canada's cow and bull inventories 
to continue to grow and exert downward pressure on Canada's cow prices, 
which are already well below U.S. price levels. Canadian suppliers 
would be prevented from participating in the current high-demand market 
in the United States for processing beef, and U.S. processors would not 
benefit from the additional source of supply during a time when U.S. 
cow slaughter is cyclically low.
    This alternative would maintain the status quo in terms of beef 
imports, other than removing permit requirements and broadening the 
commodities allowed to be imported beyond boneless beef. In terms of 
the quantity of beef imported, we expect that these changes would have 
a very small effect, given the large share of Canada's historic exports 
that enter currently.
    This alternative would affect cattle imports from Canada by 
removing the incentive for Canadian cows to be slaughtered in place of 
fed cattle, since the processing beef would not be allowed to be 
imported by the United States; there would not be the displaced fed 
cattle assumed to be available for import under the rule. The number of 
fed cattle imports would be fewer than

[[Page 542]]

with the rule, especially in 2005, and price and welfare impacts, 
including net benefits, would be smaller.
    Welfare effects of this alternative for cattle and beef are 
summarized in Table 3. Present values and annualized values of welfare 
gains and losses over the five-year period 2005-2009 are determined 
using 3 percent and 7 percent discount rates in both 2005 and 2001 
dollars.

     Table 3.--Alternative of Canadian Beef Imports Only From Cattle Less Than 30 Months of Age: Present and
Annualized Value Estimations of the Effects of the Rule for Fed Cattle, Feeder Cattle, and Beef, Discounted at 3
                            Percent and 7 Percent, in 2005 and 2001 Dollars 2005-2009
----------------------------------------------------------------------------------------------------------------
                                                          Discount    Changes in welfare (per thousand dollars)
                         Value                              rate    --------------------------------------------
                                                         (percent)     Consumer        Producer          Net
----------------------------------------------------------------------------------------------------------------
Present, 2005 dollars.................................            3   $2,399,299        -$2,345,160      $54,139
                                                                  7    2,064,181         -2,016,794       47,387
Present, 2001 dollars.................................            3    2,261,339         -2,210,314       51,026
                                                                  7    1,945,490         -1,900,828       44,662
Annualized, 2005 dollars..............................            3      523,898           -512,076       11,821
                                                                  7      503,434           -491,877       11,557
Annualized, 2001 dollars..............................            3      493,774           -482,632       11,142
                                                                  7      474,487           -463,594      10,893
----------------------------------------------------------------------------------------------------------------
Note: The present and annualized values are midpoints taken from Appendix U, based on the assumed backlog
  imports.

    The present value of the net benefit of the alternative for cattle 
and beef is estimated to range in 2005 dollars between $47.4 million 
and $54.1 million, depending on the discount rate used (with the rule: 
Between $66.3 million and $74.6 million). Over the five-year period, 
the annualized value of the net benefit in 2005 dollars, depending on 
the discount rate, may range between $11.6 million and $11.8 million 
(with the rule: Between $16.2 million and $16.3 million).
    The largest effects for cattle are expected to occur in 2005, when 
the backlog is imported. Since allowing Canadian beef imports only from 
cattle slaughtered at less than 30 months of age would not affect the 
number of feeder cattle expected to be imported, effects for feeder 
cattle would be the same as with the rule.
    Possible effects of this alternative for future U.S. exports would 
differ from possible effects with the rule only if other countries 
perceived BSE-risks associated with Canadian beef produced from cattle 
slaughtered at less than 30 months of age as different from those 
associated with Canadian beef produced from cattle slaughtered at more 
than 30 months of age.
    There would be no known reduction in risk of BSE introduction under 
this alternative. Removal of SRMs at slaughter and other required risk-
mitigating measures of the rule will ensure that beef entering from 
Canada satisfies animal health criteria the same as or equivalent to 
those required in the United States.
    Near-term price effects of this alternative would be similar to 
those of this rule. For example, for fed cattle the decrease in price 
when the backlog is assumed to enter entirely within one quarter is 
estimated to be 4.4 percent (with the rule: 5.4 percent), assuming a 
price elasticity of supply of 0.61 and a price elasticity of demand of 
-0.76. When the backlog of fed cattle is assumed to enter over two 
quarters using the same price elasticities, the decline in price is 
estimated to be 2.8 percent (with the rule: 3.8 percent). Entry of the 
backlog of feeder cattle over the two quarters could result in a price 
decline of 1.9 percent under this alternative and using the same 
elasticities, compared to a possible price drop of 3.3 percent when the 
backlog is assumed to enter entirely within one quarter. The expected 
effects are the same for feeder cattle under this alternative and with 
the rule because their number is assumed to be unaffected by whether 
Canadian beef imports are restricted to being derived from cattle less 
than 30 months of age. When the supply and demand elasticities are 
halved (supply elasticity of 0.30, and demand elasticity of -0.38, for 
example, and fed cattle are assumed to enter within two quarters, the 
decrease in price is estimated to be 3.6 percent (with the rule, 4.8 
percent), compared to a decrease of 2.8 percent (with the rule, 3.8 
percent) when a supply elasticity of 0.61 and demand elasticity of -
0.76 are used.
    No live ruminants. Direct effects of this alternative would be 
equivalent to expected effects of the rule only for ruminant products. 
We would expect the same effect for beef as with the rule; imports of 
beef from cows would replace imports of beef from fed cattle, yielding, 
for the five-year period 2005-2009, present value losses for consumers 
of between $73.9 million and $78.8 million, gains for producers of 
between $73.7 million and $78.5 million, and net welfare losses of 
between $264,000 and $283,000, compared to the baseline (3 percent 
discount rate, 2005 dollars). There would also be net benefits forgone 
by the continued prohibition on the importation of sheep and goats. 
Possible effects of this alternative on future U.S. exports would 
likely be small, since it would maintain the current prohibition on 
imports of live ruminants from Canada.
    In sum, the rule is preferable in terms of expected net benefits to 
the status quo (continuing to prohibit the entry of Canadian ruminants, 
and the entry of Canadian ruminant products other than those allowed by 
permit), and to the two alternatives discussed: Limiting beef imports 
to cattle slaughtered at less than 30 months of age or allowing entry 
of ruminant products but not live ruminants. Risks of BSE introduction 
would not be reduced to any known degree by selecting one of the 
alternatives in place of the rule. We believe that listing Canada as a 
minimal-risk region subject to the required risk-mitigating measures is 
a balanced response, based on scientific evidence, to Canada's request 
that certain ruminant and ruminant product imports by the United States 
be allowed to resume.

Final Regulatory Flexibility Analysis

    As a part of the rulemaking process, APHIS evaluates whether 
regulations are likely to have a significant economic impact on a 
substantial number of small entities. The resumption of ruminant and 
ruminant product imports from Canada will most importantly affect the 
cattle industry, reducing prices and increasing supplies. Entry of fed 
cattle

[[Page 543]]

(and fed sheep and goats) will benefit U.S. slaughtering 
establishments, and entry of feeder cattle (and feeder sheep and goats) 
will benefit feedlots. Also, entry of beef from cattle slaughtered at 
over 30 months of age will benefit some U.S. meat and meat product 
wholesalers and packers by providing an additional source of processing 
beef. At the same time, these imports will increase the competition for 
U.S. and foreign suppliers of these commodities.
    The main industries expected to be affected by the rule are 
composed predominantly of small entities, as indicated by the 1997 
Economic Census, the 2002 Census of Agriculture, and USDA's ``Cattle on 
Feed'' (February 20, 2004). The small entities number in the hundreds 
of thousands, with cattle producers comprising the largest number. For 
beef cattle ranching and farming, the 2002 Census of Agriculture 
indicates a total of about 657,000 operations, of which nearly 656,000 
are considered small entities. For cattle feedlots, more than 91,000 of 
the approximately 93,200 total operations are small entities. For sheep 
and goat farming, 44,000 out of about 44,200 operations are considered 
small entities. Small entities similarly dominate, in terms of 
percentage operations, other affected industries, including animal 
slaughtering, meat and meat byproduct processing, and meat and meat 
product wholesaling.
    Notwithstanding the prevalence of small entities, the concentrated 
structure of affected industries is well-documented. In the U.S. 
meatpacking industry, for example, four firms handle nearly 80 percent 
of all steer and heifer slaughter. The cattle feedlot industry is also 
highly concentrated. Data from 2003 show that only 2 percent of 
feedlots have capacities greater than 1,000 head, and yet these larger 
feedlots market 85 percent of fed cattle.
    Imports from Canada that will be allowed to resume are expected to 
have a larger effect on the fed cattle market than on the feeder cattle 
market. Prices and welfare of producers and suppliers will decline 
because of the additional supply and the welfare of consumers and 
buyers will increase. Net benefits of the rule will be positive.
    The analysis provides an estimation of possible price effects for 
small-entity and other producers and processors during the first 3 to 6 
months that the rule is in effect, when impacts may be greatest due to 
the expected importation of the backlog. Depending on the assumed 
elasticities of supply and demand and the period over which the backlog 
enters, the estimated price declines could range from 1.9 percent to 
4.4 percent for feeder cattle and from 3.8 percent to 6.9 percent for 
fed cattle. For the year 2005, the model indicates a possible decline 
in feeder cattle prices of 1.3 percent and a possible decline in fed 
cattle prices of 3.2 percent.
    To give these average percentage price decline some perspective, we 
consider as an example their effect on earnings by small U.S. beef cow 
herds. Based on data from the 2002 Census of Agriculture, the average 
value of sales of cattle and calves by small-entity beef cow operations 
was about $26,700. Given the forecast feeder cattle baseline price for 
2005 of between $94 and $100 per cwt, the 2005 estimated price decline 
of 1.3 percent would be equivalent to a decrease of between $1.22 to 
$1.30 per cwt, or a decrease in annual revenue of between $326 and 
$347, assuming no reduction in the number of cattle marketed. This 
example abstracts from the wide range in size for small beef cow herds, 
but gives an indication of a possible average price effect of the rule 
for these operators in 2005. It should be recognized that while the 
decline in price would be a loss for producers, it would represent a 
gain for small-entity feedlot operators.
    Beyond the net welfare gains as summarized in Table 1, there will 
likely be regional impacts not captured in the analysis. Among comments 
received on the proposed rule were ones that pointed out the historical 
reliance of some northern U.S. meat processing plants (and the 
communities they support) on cattle imports from Canada to maintain 
necessary throughput volumes. Historical dependence of these processing 
facilities on cattle imports from Canada exemplifies economic ties with 
Canadian entities that existed prior to the prohibition on ruminant 
imports. Resumption of imports will enable trade relationships 
involving small-entity operations to be reestablished.
    Alternatives to the rule, whether leaving the regulations unchanged 
or modifying the commodities and/or import requirements specified in 
the rule, would benefit certain categories of small entities while 
harming others. For example, a continued prohibition on the importation 
of Canadian feeder cattle would benefit small-entity suppliers of 
feeder cattle, but at the expense of small-entity feedlot operators. 
Estimated price declines, particularly in the near term, will cause 
economic losses for some entities and at the same time benefit other 
entities. Overall, the analysis indicates the rule will have a net 
positive effect for the United States.

Small Business Regulatory Enforcement Fairness Act of 1996

    This rule has been designated by the Administrator, Office of 
Information and Regulatory Affairs, Office of Management and Budget, as 
a major rule under the Small Business Regulatory Enforcement Fairness 
Act of 1996 (5 U.S.C. 801-808). Accordingly, the effective date of this 
rule has been delayed the required 60 days pending congressional 
review.

Executive Order 12988

    This final rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This rule: (1) Preempts all State and local laws 
and regulations that are inconsistent with this rule; (2) has no 
retroactive effect; and (3) does not require administrative proceedings 
before parties may file suit in court challenging this rule.

National Environmental Policy Act

    In October 2003, APHIS prepared an environmental assessment to 
consider potential impacts to the human environment from implementation 
of the proposed rulemaking. During the comment period for the proposed 
rulemaking, comments were received from the public regarding the 
environmental assessment. As a result of those comments, APHIS revised 
the environmental assessment to discuss in more detail the potential 
impacts of concern for the human environment.
    The environmental assessment was prepared in accordance with: (1) 
The National Environmental Policy Act of 1969 (NEPA), as amended (42 
U.S.C. 4321 et seq.), (2) regulations of the Council on Environmental 
Quality for implementing the procedural provisions of NEPA (40 CFR 
parts 1500-1508), (3) USDA regulations implementing NEPA (7 CFR part 
1), and (4) APHIS' NEPA Implementing Procedures (7 CFR part 372).
    APHIS sent copies of the revised environmental assessment to those 
who commented on the October 2003 environmental assessment, in 
accordance with 7 CFR 372.9(a)(3). In a separate notice in today's 
issue of the Federal Register, APHIS is announcing the availability of 
the revised assessment and is requesting comments on the revised 
assessment for 30 days.

Paperwork Reduction Act

    This final rule includes certain regulatory provisions that differ 
from those included in the November 2003 proposed rule. Some of those 
provisions involve changes from the information collection requirements 
set out in the proposed rule. These changes include

[[Page 544]]

the following regarding ruminants from Canada:
     Bovines, sheep, and goats moved from a U.S. port of entry 
to a feedlot before being moved to slaughter must be accompanied by an 
APHIS Form VS 17-130, rather than an APHIS Form VS 1-27 as proposed.
     Those animals moved to a feedlot before being moved to 
slaughter must be permanently identified in Canada as being of Canadian 
origin with a distinct and legible mark, properly and humanely applied 
with a freeze brand, hot iron, or other method. This is a change from 
the proposed requirement that permanent identification be done by 
tattooing the animal.
     Those animals moved to a feedlot must be individually 
identified in Canada by an official Canadian eartag. This requirement 
was not in the proposed rule.
     The owners of feedlots wishing to be considered designated 
feedlots must sign an agreement with APHIS. This requirement was not in 
the proposed rule.
    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
3501 et seq.), the information collection or recordkeeping requirements 
included in this rule have been approved by the Office of Management 
and Budget (OMB) under OMB control number 0579-0234.

Government Paperwork Elimination Act Compliance

    The Animal and Plant Health Inspection Service is committed to 
compliance with the Government Paperwork Elimination Act (GPEA), which 
requires Government agencies in general to provide the public the 
option of submitting information or transacting business electronically 
to the maximum extent possible. For information pertinent to GPEA 
compliance related to this rule, please contact Mrs. Celeste Sickles, 
APHIS' Information Collection Coordinator, at 301-734-7477.

References

    1. Office International des Epizooties, Terrestrial Animal Health 
Code, ``Bovine Spongiform Encephalopathy,'' Chapter 2.3.13, available 
at http://www.oie.int.
    2. Office International des Epizooties, Terrestrial Animal Health 
Code, available at http://www.oie.int.
    3. Harvard Center for Risk Analysis--Harvard School of Public 
Health, and Center for Computational Epidemiology--College of 
Veterinary Medicine, Tuskegee University, ``Evaluation of the Potential 
for Bovine Spongiform Encephalopathy in the United States,'' (2001), 
available at http://www.aphis.usda.gov/lpa/issues/bse/risk_assessment/mainreporttext.pdf; Harvard Center for Risk Analysis, Harvard School of 
Public Health, and Center for Computational Epidemiology, College of 
Veterinary Medicine, Tuskegee University, ``Evaluation of the Potential 
for Bovine Spongiform Encephalopathy in the United States'' (2003), 
available at http://www.aphis.usda.gov/lpa/issues/bse/madcow.pdf.
    4. USDA and FDA, ``A Case of Bovine Spongiform Encephalopathy (BSE) 
in the United States'' (March 2004), available at http://www.aphis.usda.gov/lpa/issues/bse/BSE_tr_ban%20_ltr_enc_1.pdf.
    5. USDA, FSIS Notice 5-04, ``Interim Guidance for Non-Ambulatory 
Disabled Cattle and Age Determination'' (January 12, 2004), available 
at http://www.fsis.usda.gov/Frame/FrameRedirect.asp?main=/oppde/rdad/fsisnotices/5-04.pdf; USDA, FSIS Notice 7-04, ``Questions and Answers 
for FSIS Notice 4-04 Regarding FSIS BSE Regulations'' (January14, 
2004), available at http://www.fsis.usda.gov/Frame/FrameRedirect.asp?main=/oppde/rdad/fsisnotices/7-04.pdf; USDA, FSIS 
Notice 9-04, ``Verification Instructions for the Interim Final Rule 
Regarding Specified Risk Materials (SRMs) in Cattle'' (January 23, 
2004), available at http://www.fsis.usda.gov/Frame/FrameRedirect.asp?main=/oppde/rdad/fsisnotices/9-04.pdf; USDA, FSIS 
Notice 10-04, ``Questions and Answers, Regarding the Age Determination 
of Cattle and Sanitation'' (January 29, 2004), available at http://www.fsis.usda.gov/Frame/FrameRedirect.asp?main=/oppde/rdad/fsisnotices/10-04.pdf
    6. FDA, ``CVM Update: July 2004 Update on Ruminant Feed (BSE) 
Enforcement Activities,'' (July 29, 2004), available at http://www.fda.gov/cvm/index/updates/bse72004up.htm.
    7. Research Triangle Institute, ``Review of the Evaluation of the 
Potential for Bovine Spongiform Encephalopathy in the United States'' 
(October 31, 2002), available at http://www.aphis.usda.gov/lpa/issues/bse/BSE_Peer_Review.pdf.
    8. Joshua T. Cohen and George M. Gray, Harvard Center for Risk 
Analysis, Harvard School of Public Health, ``Evaluation of the 
Potential for Bovine Spongiform Encephalopathy in the United States: 
Response to Reviewer Comments submitted by Research Triangle Institute 
(RTI project number 07182.024)'' (October 31, 2003), available at 
http://www.hcra.harvard.edu/pdf/ResponsetoComments.pdf.
    9. Harvard Center for Risk Analysis, Harvard School of Public 
Health, and Center for Computational Epidemiology, College of 
Veterinary Medicine, Tuskegee University, ``Evaluation of the Potential 
for Bovine Spongiform Encephalopathy in the United States,'' pg. 111 
(2003), available at http://www.hcra.harvard.edu/pdf/madcow.pdf.
    10. Joshua T. Cohen and George M. Gray, Harvard Center for Risk 
Analysis--Harvard School of Public Health, ``Evaluation of the 
Potential Spread of BSE in Cattle and Possible Human Exposure Following 
Introduction of Infectivity into the United States from Canada'' (2003) 
available at http://www.aphis.usda.gov/lpa/issues/bse/harvard_10-3/text_wrefs.pdf.
    11. Evans, Brian, Chief Veterinary Officer, Memo to Dr. John 
Clifford, Deputy Administrator at APHIS (July 30, 2004).
    12. Morley, R.S., S. Chen, and N. Rheault, ``Assessment of the Risk 
Factors Related to Bovine Spongiform Encephalopathy,'' Revue 
Scientifique et Techique Office International des Epizooties 22(1):157-
78 (2003), available at http://www.oie.int/eng/publicat/rt/2201/10.%20Morley.pdf; Canadian Food Inspection Agency, Science Branch, 
Animal Health Risk Analysis, ``Risk Assessment on Bovine Spongiform 
Encephalopathy in Cattle in Canada'' (2002), available at http://www.inspection.gc.ca/english/sci/ahra/bseris/bserise.shtml.
    13. Canadian Food Inspection Agency, ``Summary of the Report of the 
Investigation of Bovine Spongiform Encephalopathy (BSE) in Alberta 
Canada'' (2003), available at http://www.inspection.gc.ca/english/anima/heasan/disemala/bseesb/evalsume.shtml.
    14. International Review Team, ``Report on Actions Taken by Canada 
in Response to the Confirmation of an Indigenous Case of BSE'' (2003), 
available at http://www.inspection.gc.ca/english/anima/heasan/disemala/bseesb/internate.shtml. See also Government of Canada, ``News Release: 
Minister's Comment on International Report on BSE'' (June 26, 2003), 
available at http://www.inspection.gc.ca/english/corpaffr/newcom/2003/20030626e.shtml.
    15. Canadian Food Inspection Agency, ``BSE in North America; 
Specified Risk Materials,'' http://www.inspection.gc.ca/english/anima/heasan/disemala/bseesb/srmmrse.shtml.

[[Page 545]]

    16. Canadian Food Inspection Agency, ``BSE in North America; 
Surveillance and Animal Tracking,'' http://www.inspection.gc.ca/english/anima/heasan/disemala/bseesb/surv/protecte.shtml.
    17. Harvard Center for Risk Analysis, Harvard School of Public 
Health, and Center for Computational Epidemiology, College of 
Veterinary Medicine, Tuskegee University, ``Evaluation of the Potential 
for Bovine Spongiform Encephalopathy in the United States'' (2003), pg. 
53, available at http://www.aphis.usda.gov/lpa/issues/bse/madcow.pdf.
    18. Harvard Center for Risk Analysis, Harvard School of Public 
Health, and Center for Computational Epidemiology, College of 
Veterinary Medicine, Tuskegee University, ``Evaluation of the Potential 
for Bovine Spongiform Encephalopathy in the United States'' (2003), 
Appendix 1, pg. 29, available at http://www.aphis.usda.gov/lpa/issues/bse/harvard_10-3/appendix_1.pdf.
    19. Office International des Epizooties, Terrestrial Animal Health 
Code, ``Guidelines for Risk Analysis,'' Chap. 1.3.2, Art. 1.3.2.3, 
available at http://www.oie.int.
    20. USDA, ``News Release: Veneman Announces Expanded BSE 
Surveillance Program'' (March 15, 2004), available at http://www.usda.gov/Newsroom/0105.04.html.
    21. USDA, APHIS, Veterinary Services, ``Analysis of Risk--Update 
for the Final Rule: Bovine Spongiform Encephalopathy; Minimal Risk 
Regions and Importation of Commodities, December 2004,'' available at 
http://www.aphis.usda.gov/lpa/issues/bse/bse.html.
    22. Kirkwood, J. K. and A. A. Cunningham, ``Epidemiological 
Observations on Spongiform Encephalopathies in Captive Wild Animals in 
the British Isles,'' Veterinary Record 135:296-303 (1994).
    23. Office International des Epizooties, Terrestrial Animal Health 
Code, ``Bovine Spongiform Encephalopathy,'' Chap. 2.3.13, Art. 
2.3.13.15 and Art. 2.3.13.19, available at http://www.oie.int.
    24. Prince, M.J., et. al., ``Bovine Spongiform Encephalopathy,'' 
Revue Scientifique et Techique, Office International des Epizooties 
22(1):37-60 (2003).
    25. Brown, Paul, et. al., ``Bovine Spongiform Encephalopathy and 
Variant Creutzfeldt-Jakob Disease: Background, Evolution, and Current 
Concerns,'' Emerging Infectious Diseases 7(1):6-16 (2001), available at 
http://www.cdc.gov/ncidod/eid/vol7no1/brown.htm.
    26. USDA, ``Official United States Standards for Grades of 
Slaughter Lambs, Yearlings and Sheep'' (1992), available at http://www.ams.usda.gov/lsg/stand/standards/sl-lamb.pdf. See also, e.g., 
``Labeling Standards for Ovine Carcasses, Parts of Carcasses, Meat and 
Meat Food Products,'' Docket No. 97-030A, November 21, 1997; 62 FR 
62271-62273.
    27. Comer, P.J. and P.J. Huntley, ``Exposure of the Human 
Population to BSE Infectivity over the Course of the BSE Epidemic in 
Great Britain and the Impact of Changes to the Over Thirty Month 
Rule,'' Over Thirty Month Rule (OTMR) Review Paper (June 2003), 
available at http://www.food.gov.uk/multimedia/pdfs/otmcomer.pdf.
    28. European Union Scientific Steering Committee, ``Revised Opinion 
and Report on: The Safety of Tallow Obtained from Ruminant Slaughter 
By-Products'' (adopted June 28-29, 2001), available at http://europa.eu.int/comm/food/fs/sc/ssc/out228_en.pdf.
    29. European Union Scientific Steering Committee, ``Listing of 
Specified Risk Materials: A Scheme for Assessing Relative Risks to 
Man'' (adopted December 9, 1997), available at http://europa.eu.int/comm/food/fs/sc/ssc/out22_en.pdf.
    30. Brown, P., R. G. Rohwer, B. C. Dunstan, C. MacAuley, D. C. 
Gajdusek, and W. N. Drohan, ``The Distribution of Infectivity in Blood 
Components and Plasma Derivatives in Experimental Models of 
Transmissible Spongiform Encephalopathy,'' Transfusion 38:810-816 
(1998); Manuelidis, E. E., E.J. Gorgacz, L. Manuelidis, ``Transmission 
Creutzfeldt-Jakob Disease with Scrapie-Like Syndromes to Mice,'' Nature 
271:778-779 (1978).
    31. Center for Disease Control, ``Bovine Spongiform Encephalopathy 
in a Dairy Cow-- Washington State, 2003,'' MMWR Weekly 52(53):1280-1285 
(2004).
    32. Codex Alimentarius Commission, ``Principles and Guidelines for 
the Conduct of Microbiological Risk Assessment,'' Section 4--Guidelines 
for Application, CAC/GL-30 (1999), available at http://www.codexalimentarius.net/web/standard_list.do?lang=en.
    33. Harvard Center for Risk Analysis, Harvard School of Public 
Health, and Center for Computational Epidemiology, College of 
Veterinary Medicine, Tuskegee University, ``Evaluation of the Potential 
for Bovine Spongiform Encephalopathy in the United States'' (2003), pg. 
2, available at http://www.aphis.usda.gov/lpa/issues/bse/madcow.pdf.
    34. USDA, ``Report of the Secretary's Advisory Committee on Foreign 
Animal and Poultry Diseases: Measures Relating to Bovine Spongiform 
Encephalopathy in the United States'' (February 13, 2004), available at 
http://cofcs66.aphis.usda.gov/lpa/issues/bse/bse_sec_adv_comm.pdf.
    35. The Secretary's Foreign Animal and Poultry Disease Advisory 
Committee's Subcommittee on the United States' Response to the 
Detection of a Case of Bovine Spongiform Encephalopathy or 
International Review Team (IRT), ``Report on Measures Relating to 
Bovine Spongiform Encephalopathy (BSE) in the United States'' (2004), 
available at http://www.aphis.usda.gov/lpa/issues/bse/BSE_tr_ban_ltr%20_enc_2.pdf.
    36. Harvard Center for Risk Analysis, Harvard School of Public 
Health, and Center for Computational Epidemiology, College of 
Veterinary Medicine, Tuskegee University, ``Evaluation of the Potential 
for Bovine Spongiform Encephalopathy in the United States,'' pg. vii-
viii (2003), available at http://www.aphis.usda.gov/lpa/issues/bse/madcow.pdf.
    37. Gray, G. Cohen, J., Harvard Center for Risk Analysis, Harvard 
School of Public Health, ``Response to Comments Submitted in Response 
to USDA's Proposed Rule on Importing Beef and Beef Products from 
Canada'' (June 18, 2004).
    38. Harvard Center for Risk Analysis, Harvard School of Public 
Health, and Center for Computational Epidemiology, College of 
Veterinary Medicine, Tuskegee University, ``Evaluation of the Potential 
for Bovine Spongiform Encephalopathy in the United States,'' Section 
4.4.1--Switzerland (2003), available at http://www.aphis.usda.gov/lpa/issues/bse/madcow.pdf.
    39. Yamakawa, Y., K. Hagiwara, K. Nohtomi, et al, ``For the Expert 
Committee for BSE Diagnosis, Ministry of Health, Labour and Welfare of 
Japan: Atypical Proteinase K-Resistant Prion Protein (PrPres) Observed 
in an Apparently Healthy 23-Month-Old Holstein Steer,'' Jpn J Infect 
Dis 56:221-222 (2003), available at http://www.nih.go.jp/JJID/56/221.pdf and Casalone, C., G. Zanusso, PL. Acutis, et al, 
``Identification of a Novel Molecular and Neuropathological BSE 
Phenotype in Italy: International Conference on Prion Disease: From 
Basic Research to Intervention Concepts,'' 8-10 (October, 2003).
    40. Scientific Steering Committee, ``Opinion on TSE Infectivity 
Distribution in Ruminant Tissues (State of Knowledge, December 2001)'' 
(Adopted January 10-11, 2002),

[[Page 546]]

available at http://europa.eu.int/comm/food/fs/sc/ssc/out241_en.pdf.
    41. Wilesmith, JW et. al., ``A Cohort Study to Examine Maternally-
Associated Risk Factors for Bovine Spongiform Encephalopathy,'' 
Veterinary Record 141:239-243 (1997).
    42. FSIS, ``Prohibition of the Use of Specified Risk Materials for 
Human Food and Requirements for the Disposition of Non-Ambulatory 
Disabled Cattle; Meat Produced by Advanced Meat/Bone Separation 
Machinery and Meat Recovery (AMR) Systems; Prohibition of the Use of 
Certain Stunning Devices Used To Immobilize Cattle During Slaughter; 
Bovine Spongiform Encephalopathy Surveillance Program; Interim Final 
Rules and Notice,'' Docket No 03-025IF, 69 FR 1861-1874 (January 12, 
2004).
    43. Mulkey, David and Alan W. Hodges, ``Using IMPLAN to Assess 
Local Economic Impacts,'' (last visited December 6, 2004), available at 
http://hortbusiness.ifas.ufl.edu/usingimplan.pdf.
    44. OMB, ``Circular A-4: Regulatory Analysis'' (September 17, 
2003).
    45. USDA Economic Research Service, ``Dissecting the Challenges of 
Mad Cow and Foot-and-Mouth Disease,'' Agricultural Outlook 4-5 (Aug. 
2001), available at http://www.ers.usda.gov/publications/AgOutlook/aug2001/AO283c.pdf.
    46. United States Meat Export Federation,--Methodology and Results 
of the Value of Beef Exports,'' pp. 8-9 (2002), available at http://www.cattle-fax.com/special/files/beefvalue_method_02.pdf.
    47. FDA, ``Substances Prohibited From Use in Animal Food or Feed; 
Animal Proteins Prohibited in Ruminant Feed,'' Docket No 02N-0273, 67 
FR 67572-67573 (November 6, 2002).
    48. The guidelines are discussed in WHO, ``Joint WHO/FAO/OIE 
Technical Consultation on BSE: Public Health, Animal Health and Trade'' 
(June 11-14, 2001), available at http://www.who.int/emc-documents/tse/docs/whocdscsraph20018.pdf.
    49. Prince, M.J., et. al., ``Bovine Spongiform Encephalopathy,'' 
Revue scientifique et technique, Office International des Epizooties 
22(1) 37-60 (2003); Wilesmith, J.W., ``The Epidemiology of Bovine 
Spongiform Encephalopathy,'' Seminars in Virology 2:239-45 (1991); 
Wilesmith, J.W., et. al., ``Bovine Spongiform Encephalopathy: 
Epidemiological Studies,'' Veterinary Record 123:638-644 (1988).
    50. AMS USDA, ``Country of Origin Labeling--Current Status of 
Country of Origin Labeling,'' available at http://www.ams.usda.gov/cool/status.htm.

List of Subjects

9 CFR Part 93

    Animal diseases, Imports, Livestock, Poultry and poultry products, 
Quarantine, Reporting and recordkeeping requirements.

9 CFR Part 94

    Animal diseases, Imports, Livestock, Meat and meat products, Milk, 
Poultry and poultry products, Reporting and recordkeeping requirements.

9 CFR Part 95

    Animal feeds, Hay, Imports, Livestock, Reporting and recordkeeping 
requirements, Straw, Transportation.

9 CFR Part 96

    Imports, Livestock, Reporting and recordkeeping requirements.

0
Accordingly, we are amending 9 CFR parts 93, 94, 95, and 96 as follows:

PART 93--IMPORTATION OF CERTAIN ANIMALS, BIRDS, AND POULTRY, AND 
CERTAIN ANIMAL, BIRD, AND POULTRY PRODUCTS; REQUIREMENTS FOR MEANS 
OF CONVEYANCE AND SHIPPING CONTAINERS

0
1. The authority citation for part 93 continues to read as follows:

    Authority: 7 U.S.C. 1622 and 8301-8317; 21 U.S.C. 136 and 136a; 
31 U.S.C. 9701; 7 CFR 2.22, 2.80, and 371.4.

0
2. Section 93.400 is amended by revising the definitions of flock and 
inspector and adding definitions of as a group, bovine, bovine 
spongiform encephalopathy (BSE) minimal risk region, camelid, cervid, 
designated feedlot, positive for a transmissible spongiform 
encephalopathy, premises of origin, State representative, suspect for a 
transmissible spongiform encephalopathy, and USDA representative, in 
alphabetical order, to read as follows:


Sec.  93.400  Definitions.

* * * * *
    As a group. Collectively, in such a manner that the identity of the 
animals as a unique group is maintained.
    Bovine. Bos taurus, Bos indicus, and Bison bison.
    Bovine spongiform encephalopathy (BSE) minimal risk region. A 
region listed in Sec.  94.18(a)(3) of this subchapter.
* * * * *
    Camelid. All species of the family Camelidae, including camels, 
llamas, alpacas, and vicunas.
* * * * *
    Cervid. All members of the family Cervidae and hybrids, including 
deer, elk, moose, caribou, reindeer, and related species.
* * * * *
    Designated feedlot. A feedlot that has been designated by the 
Administrator as one that is eligible to receive sheep and goats 
imported from a BSE minimal-risk region and whose owner or legally 
responsible representative has signed an agreement in accordance with 
Sec.  93.419(d)(8) of this subpart to adhere to, and is in compliance 
with, the requirements for a designated feedlot.
* * * * *
    Flock. Any group of one or more sheep maintained on common ground; 
or two or more groups of sheep under common ownership or supervision on 
two or more premises that are geographically separated, but among which 
there is an interchange or movement of animals.
* * * * *
    Inspector. Any individual authorized by the Administrator of APHIS 
or the Commissioner of Customs and Border Protection, Department of 
Homeland Security, to enforce the regulations in this subpart.
* * * * *
    Positive for a transmissible spongiform encephalopathy. A sheep or 
goat for which a diagnosis of a transmissible spongiform encephalopathy 
has been made.
    Premises of origin. Except as otherwise used in Sec.  93.423 of 
this subpart, the premises where the animal was born.
* * * * *
    State representative. A veterinarian or other person employed in 
livestock sanitary work by a State or political subdivision of a State 
who is authorized by such State or political subdivision of a State to 
perform the function involved under a memorandum of understanding with 
APHIS.
    Suspect for a transmissible spongiform encephalopathy. (1) A sheep 
or goat that has tested positive for a transmissible spongiform 
encephalopathy or for the proteinase resistant protein associated with 
a transmissible spongiform encephalopathy, unless the animal is 
designated as positive for a transmissible spongiform encephalopathy; 
or
    (2) A sheep or goat that exhibits any of the following signs and 
that has been determined to be suspicious for a transmissible 
spongiform encephalopathy by a veterinarian: Weight loss despite 
retention of appetite; behavior abnormalities; pruritus (itching); wool 
pulling; biting at legs or side; lip smacking; motor

[[Page 547]]

abnormalities such as incoordination, high stepping gait of forelimbs, 
bunny hop movement of rear legs, or swaying of back end; increased 
sensitivity to noise and sudden movement; tremor, ``star gazing,'' head 
pressing, recumbency, or other signs of neurological disease or chronic 
wasting.
* * * * *
    USDA representative. A veterinarian or other individual employed by 
the United States Department of Agriculture who is authorized to 
perform the services required by this part.
* * * * *

0
3. Section 93.405 is amended as follows:
0
a. A new paragraph (a)(4) is added to read as set forth below.
0
b. In paragraphs (b)(2) introductory text, (c)(2), and (c)(3) the 
phrase ``Australia, Canada, and New Zealand'' is removed and the phrase 
``Australia and New Zealand'' is inserted in its place.
0
c. In paragraph (c)(3), the phrase ``Australia, Canada, New Zealand, or 
the United States'' is removed and the phrase ``Australia, New Zealand, 
or the United States'' is added in its place.
0
d. The Office of Management and Budget citation at the end of the 
section is revised to read as set forth below.


Sec.  93.405  Certificate for ruminants.

    (a) * * *
    (4) If the ruminants are bovines, sheep, or goats from regions 
listed as BSE minimal-risk regions in Sec.  94.18(a)(3) of this 
subchapter, the certificate must also include the name and address of 
the importer; the species, breed, and number or quantity of ruminants 
to be imported; the purpose of the importation; individual ruminant 
identification, which includes the eartag required under Sec.  
93.419(d)(2) or Sec.  93.436(b)(4) of this subchapter, and any other 
identification present on the animal, including registration number, if 
any; a description of the ruminant, including name, age, color, and 
markings, if any; region of origin; the address of or other means of 
identifying the premises of origin and any other premises where the 
ruminants resided immediately prior to export, including the State or 
its equivalent, the municipality or nearest city, or an equivalent 
method, approved by the Administrator, of identifying the location of 
the premises, and the specific physical location of the feedlot where 
the ruminants are to be moved after importation; the name and address 
of the exporter; the port of embarkation in the foreign region; and the 
mode of transportation, route of travel, and port of entry in the 
United States.
* * * * *
    (Approved by the Office of Management and Budget under control 
numbers 0579-0040, 0579-0165, and 0579-0234)

0
4. In Sec.  93.419, new paragraphs (c) and (d) are added to read as 
follows:


Sec.  93.419  Sheep and goats from Canada.

* * * * *
    (c) Any sheep or goats imported from Canada must be less than 12 
months of age when imported into the United States and when 
slaughtered, and must be from a flock or herd subject to a ruminant 
feed ban equivalent to the requirements established by the U.S. Food 
and Drug Administration at 21 CFR 589.2000. The animals must be 
accompanied by a certificate issued or endorsed by a salaried 
veterinarian of the Canadian Government that states that the conditions 
of this paragraph have been met. Additionally, for sheep and goats 
imported for other than immediate slaughter, the certificate must state 
that the conditions of paragraphs (d)(1) and (d)(2) of this section 
have been met. For sheep and goats imported for immediate slaughter, 
the certificate must also state that:
    (1) The animals have not tested positive for and are not suspect 
for a transmissible spongiform encephalopathy.
    (2) The animals have not resided in a flock or herd that has been 
diagnosed with BSE; and
    (3) The animals' movement is not restricted within Canada as a 
result of exposure to a transmissible spongiform encephalopathy.
    (d) Imported for feeding. Any sheep or goats imported from Canada 
for feeding at a feedlot must be imported only through a port of entry 
listed in Sec.  93.403(b) or as provided for in Sec.  93.403(f) in a 
means of conveyance sealed in the region of origin with seals of the 
national government of the region of origin, must be moved directly as 
a group from the port of entry to a designated feedlot, must not be 
commingled with any sheep or goats that are not being moved directly to 
slaughter from the designated feedlot at less than 12 months of age, 
and must meet the following conditions:
    (1) The sheep and goats must be permanently and humanely identified 
before arrival at the port of entry with a distinct and legible ``C'' 
mark, properly applied with a freeze brand, hot iron, or other method, 
and easily visible on the live animal and on the carcass before 
skinning. The mark must be not less than 1 inch or more than 1\1/4\ 
inches high. Other means of permanent identification may be used upon 
request if deemed adequate by the Administrator to humanely identify 
the animal in a distinct and legible way as having been imported from 
Canada;
    (2) Each sheep and goat must be individually identified by an 
official Canadian Food Inspection Agency eartag, applied before the 
animal's arrival at the port of entry into the United States, that is 
determined by the Administrator to meet standards equivalent to those 
for official eartags in the United States as defined in Sec.  71.1 of 
this chapter and to be traceable to the premises of origin of the 
animal. No person may alter, deface, remove, or otherwise tamper with 
the individual identification while the animal is in the United States 
or moving into or through the United States, except that the 
identification may be removed at the time of slaughter;
    (3) The animals may be moved from the port of entry only to a 
feedlot designated in accordance with paragraph (d)(8) of this section 
and must be accompanied from the port of entry to the designated 
feedlot by APHIS Form VS 17-130 or other movement documentation deemed 
acceptable by the Administrator, which must identify the physical 
location of the feedlot, the individual responsible for the movement of 
the animals, and the individual identification of each animal, which 
includes the eartag required under paragraph (d)(2) of this section and 
any other identification present on the animal, including registration 
number, if any;
    (4) The seals of the national government of Canada must be broken 
only at the port of entry by the APHIS port veterinarian or at the 
designated feedlot by an accredited veterinarian or a State or USDA 
representative or his or her designee. If the seals are broken by the 
APHIS port veterinarian at the port of entry, the means of conveyance 
must be resealed with seals of the U.S. Government before being moved 
to the designated feedlot;
    (5) The animals must remain at the designated feedlot until 
transported to a recognized slaughtering establishment. The animals 
must be moved directly to the recognized slaughtering establishment in 
a means of conveyance sealed with seals of the U.S. Government by an 
accredited veterinarian or a State or USDA representative. The seals 
must be broken only at the recognized slaughtering establishment by a 
USDA representative;

[[Page 548]]

    (6) The animals must be accompanied to the recognized slaughtering 
establishment by APHIS Form VS 1-27 or other documentation deemed 
acceptable by the Administrator, which must identify the physical 
location of the recognized slaughtering establishment, the individual 
responsible for the movement of the animals, and the individual 
identification of each animal, which includes the eartag required under 
paragraph (d)(2) of this section and any other identification present 
on the animal, including registration number, if any;
    (7) The animals must be less than 12 months of age when 
slaughtered;
    (8) To be approved to receive sheep or goats imported for feeding, 
a feedlot must have signed a written agreement with the Administrator 
stating that the feedlot:
    (i) Will not remove eartags from animals unless medically 
necessary, in which case another eartag or other form of official 
identification, as defined in Sec.  79.1 of this chapter, will be 
applied and cross referenced in the records;
    (ii) Will monitor all incoming imported feeder animals to ensure 
that they have the required ``C'' brand;
    (iii) Will maintain records of the acquisition and disposition of 
all imported sheep and goats entering the feedlot, including the 
Canadian Food Inspection Agency tag number and all other identifying 
information, the age of each animal, the date each animal was acquired 
and the date each animal was shipped to slaughter, and the name and 
location of the plant where each animal was slaughtered. For Canadian 
animals that die in the feedlot, the feedlot will remove its eartag and 
place it in a file along with a record of the disposition of the 
carcass;
    (iv) Will maintain copies of the APHIS Forms VS 17-130 and VS 1-27 
or other movement documentation deemed acceptable by the Administrator 
that have been issued for incoming animals and for animals moved to 
slaughter and that list the official identification of each animal;
    (v) Will allow State and Federal animal health officials access to 
inspect its premises and animals and to review inventory records and 
other required files upon request;
    (vi) Will keep required records for at least 5 years;
    (vii) Will designate either the entire feedlot or pens within the 
feedlot as terminal for sheep and goats to be moved only directly to 
slaughter at less than 12 months of age, and
    (viii) Agrees that if inventory cannot be reconciled or if animals 
are not moved to slaughter as required the approval of the feedlot will 
be immediately withdrawn.
    (Approved by the Office of Management and Budget under control 
numbers 0579-0040 and 0579-0234)

0
5. Section 93.420 is revised to read as follows:


Sec.  93.420  Ruminants from Canada for immediate slaughter.

    (a) Ruminants imported from Canada for immediate slaughter must be 
imported only through a port of entry listed in Sec.  93.403(b) or as 
provided for in Sec.  93.403(f) in a means of conveyance sealed in 
Canada with seals of the Canadian Government, and must be moved 
directly as a group from the port of entry to a recognized slaughtering 
establishment for slaughter as a group. The seals must be broken only 
at the port of entry by the APHIS port veterinarian or at the 
recognized slaughtering establishment by an accredited veterinarian or 
a State or USDA representative or his or her designee. If the seals are 
broken by the APHIS port veterinarian at the port of entry, the means 
of conveyance must be resealed with seals of the U.S. Government before 
being moved to the recognized slaughtering establishment. The shipment 
must be accompanied from the port of entry to the recognized 
slaughtering establishment by APHIS Form VS 17-33, which shall include 
the location of the recognized slaughtering establishment. Such 
ruminants shall be inspected at the port of entry and otherwise handled 
in accordance with Sec.  93.408.
    (b) In addition to meeting the requirements of paragraph (a) of 
this section, sheep and goats imported from Canada for immediate 
slaughter must meet the requirements of Sec.  93.419(c) as well as the 
following conditions:
    (1) The animals have not tested positive for and are not suspect 
for a transmissible spongiform encephalopathy;
    (2) The animals have not resided in a flock or herd that has been 
diagnosed with BSE; and
    (3) The animals' movement is not restricted within Canada as a 
result of exposure to a transmissible spongiform encephalopathy.

0
6. An undesignated center heading ``Additional General Provisions'' is 
added preceding reserved Sec.  93.430.
0
6a. A new Sec.  93.436 is added to subpart D to read as follows:


Sec.  93.436  Ruminants from regions of minimal risk for BSE.

    The importation of ruminants from regions listed in Sec.  
94.18(a)(3) of this subchapter is prohibited, unless the conditions of 
this section and any other applicable conditions of this part are met. 
Once the ruminants are imported, if they do not meet the conditions of 
this section, they must be disposed of as the Administrator may direct.
    (a) Bovines for immediate slaughter. Bovines from a region listed 
in Sec.  94.18(a)(3) of this subchapter may be imported for immediate 
slaughter under the following conditions:
    (1) The bovines must be less than 30 months of age when imported 
into the United States and when slaughtered;
    (2) The bovines must have been subject to a ruminant feed ban 
equivalent to the requirements established by the U.S. Food and Drug 
Administration at 21 CFR 589.2000;
    (3) The bovines must be accompanied by a certificate issued by a 
full-time salaried veterinary officer of the national government of the 
region of origin, or issued by a veterinarian designated or accredited 
by the national government of the region of origin and endorsed by a 
full-time salaried veterinary officer of the national government of the 
region of origin, representing that the veterinarian issuing the 
certificate was authorized to do so, and the certificate states that 
the conditions of paragraphs (a)(1) and (a)(2) of this section have 
been met;
    (4) The bovines must be imported only through a port of entry 
listed in Sec.  93.403(b) or as provided for in Sec.  93.403(f) in a 
means of conveyance sealed in the region of origin with seals of the 
national government of the region of origin, and must be moved directly 
as a group from the port of entry to a recognized slaughtering 
establishment. The seals must be broken only at the port of entry by 
the APHIS port veterinarian or at the recognized slaughtering 
establishment by a USDA representative. If the seals are broken by the 
APHIS port veterinarian at the port of entry, the means of conveyance 
must be resealed with seals of the U.S. Government before being moved 
to the recognized slaughtering establishment;
    (5) The bovines must be accompanied from the port of entry to the 
recognized slaughtering establishment by APHIS Form VS 17-33; and
    (6) At the recognized slaughtering establishment, the bovines must 
be slaughtered as a group.
    (b) Bovines for feeding. Bovines from a region listed in Sec.  
94.18(a)(3) of this subchapter may be imported for movement to a 
feedlot and then to slaughter under the following conditions:

[[Page 549]]

    (1) The bovines must be less than 30 months of age when imported 
into the United States;
    (2) The bovines must have been subject to a ruminant feed ban 
equivalent to the requirements established by the U.S. Food and Drug 
Administration at 21 CFR 589.2000;
    (3) The bovines must be permanently and humanely identified before 
arrival at the port of entry with a distinct and legible mark 
identifying the exporting country, properly applied with a freeze 
brand, hot iron, or other method, and easily visible on the live animal 
and on the carcass before skinning. The mark must be not less than 2 
inches nor more than 3 inches high, and must be applied to each 
animal's right hip, high on the tail-head (over the junction of the 
sacral and first cocygeal vertebrae). Other means of permanent 
identification may be used upon request if deemed adequate by the 
Administrator to humanely identify the animal in a distinct and legible 
way as having been imported from the BSE minimal-risk exporting region. 
Bovines exported from Canada must be so marked with ``C[Lambda]N;''
    (4) Each bovine must be individually identified by an official 
eartag of the country of origin, applied before the animal's arrival at 
the port of entry into the United States, that is determined by the 
Administrator to meet standards equivalent to those for official 
eartags in the United States as defined in Sec.  71.1 of this chapter 
and to be traceable to the premises of origin of the animal. No person 
may alter, deface, remove, or otherwise tamper with the individual 
identification while the animal is in the United States or moving into 
or through the United States, except that the identification may be 
removed at the time of slaughter;
    (5) The bovines must be accompanied by a certificate issued in 
accordance with Sec.  93.405 that states, in addition to the statements 
required by Sec.  93.405, that the conditions of paragraphs (b)(1) 
through (b)(4) of this section have been met;
    (6) The bovines must be imported only through a port of entry 
listed in Sec.  93.403(b) or as provided for in Sec.  93.403(f) in a 
means of conveyance sealed in the region of origin with seals of the 
national government of the region of origin, and must be moved directly 
from the port of entry as a group to the feedlot identified on the 
APHIS VS Form 17-130 or other movement documentation required under 
paragraph (b)(8) of this section;
    (7) The seals of the national government of the region of origin 
must be broken only at the port of entry by the APHIS port veterinarian 
or at the feedlot by an accredited veterinarian or a State or USDA 
representative or his or her designee. If the seals are broken by the 
APHIS port veterinarian at the port of entry, the means of conveyance 
must be resealed with seals of the U.S. Government before being moved 
to the feedlot;
    (8) The bovines must be accompanied from the port of entry to the 
feedlot by APHIS Form VS 17-130 or other movement documentation deemed 
acceptable by the Administrator, which must identify the physical 
location of the feedlot, the individual responsible for the movement of 
the animals, and the individual identification of each animal, which 
includes the eartag required under paragraph (b)(4) of this section and 
any other identification present on the animal, including registration 
number, if any;
    (9) The bovines must remain at the feedlot until transported from 
the feedlot to a recognized slaughtering establishment for slaughter;
    (10) The bovines must be moved directly from the feedlot identified 
on APHIS Form VS 17-130 to a recognized slaughtering establishment in 
conveyances that must be sealed at the feedlot with seals of the U.S. 
Government by an accredited veterinarian or a State or USDA 
representative. The seals may be broken only at the recognized 
slaughtering establishment by a USDA representative.
    (11) The bovines must be accompanied from the feedlot to the 
recognized slaughtering establishment by APHIS Form VS 1-27 or other 
movement documentation deemed acceptable by the Administrator, which 
must identify the physical location of the recognized slaughtering 
establishment, the individual responsible for the movement of the 
animals, and the individual identification of each animal, which 
includes the eartag required under paragraph (b)(4) of this section and 
any other identification present on the animal, including registration 
number, if any; and
    (12) The bovines must be less than 30 months of age when 
slaughtered.
    (c) Sheep and goats for immediate slaughter. Sheep and goats from a 
region listed in Sec.  94.18(a)(3) of this subchapter may be imported 
for immediate slaughter under the conditions set forth in this subpart 
for such sheep and goats. The conditions for the importation of sheep 
and goats from Canada for immediate slaughter are set forth in 
Sec. Sec.  93.419(c) and 93.420.
    (d) Sheep and goats for feeding. Sheep and goats from a region 
listed in Sec.  94.18(a)(3) of this subchapter may be imported for 
other than immediate slaughter under the conditions set forth in this 
subpart for such sheep and goats. The conditions for the importation of 
sheep and goats from Canada for other than immediate slaughter are set 
forth in Sec. Sec.  93.405 and 93.419.
    (e) Cervids. There are no BSE-related restrictions on the 
importation of cervids from a region listed in Sec.  94.18(a)(3) of 
this subchapter.
    (f) Camelids. There are no BSE-related restrictions on the 
importation of camelids from a region listed in Sec.  94.18(a)(3) of 
this subchapter. (Approved by the Office of Management and Budget under 
control number 0579-0234)

PART 94-RINDERPEST, FOOT-AND-MOUTH DISEASE, FOWL PEST (FOWL 
PLAGUE), EXOTIC NEWCASTLE DISEASE, AFRICAN SWINE FEVER, CLASSICAL 
SWINE FEVER, AND BOVINE SPONGIFORM ENCEPHALOPATHY: PROHIBITED AND 
RESTRICTED IMPORTATIONS

0
7. The authority citation for part 94 continues to read as follows:

    Authority: 7 U.S.C. 450, 7701-7772, and 8301-8317; 21 U.S.C. 136 
and 136a; 31 U.S.C. 9701; 7 CFR 2.22, 2.80, and 371.4.


0
8. Section 94.0 is amended by revising the definitions of authorized 
inspector and cervid and adding new definitions of bovine, bovine 
spongiform encephalopathy (BSE) minimal-risk region, Food Safety and 
Inspection Service, personal use, positive for a transmissible 
spongiform encephalopathy, specified risk materials (SRMs), and suspect 
for a transmissible spongiform encephalopathy, in alphabetical order, 
to read as follows:


Sec.  94.0  Definitions.

* * * * *
    Authorized inspector. Any individual authorized by the 
Administrator of APHIS or the Commissioner of Customs and Border 
Protection, Department of Homeland Security, to enforce the regulations 
in this part.
* * * * *
    Bovine. Bos taurus, Bos indicus, and Bison bison.
    Bovine spongiform encephalopathy (BSE) minimal-risk region. A 
region that:
    (1) Maintains, and, in the case of regions where BSE was detected, 
had in place prior to the detection of BSE in an indigenous ruminant, 
risk mitigation measures adequate to prevent widespread exposure and/or 
establishment of the disease. Such measures include the following:

[[Page 550]]

    (i) Restrictions on the importation of animals sufficient to 
minimize the possibility of infected ruminants being imported into the 
region, and on the importation of animal products and animal feed 
containing ruminant protein sufficient to minimize the possibility of 
ruminants in the region being exposed to BSE;
    (ii) Surveillance for BSE at levels that meet or exceed 
recommendations of the World Organization for Animal Health (Office 
International des Epizooties) for surveillance for BSE; and
    (iii) A ruminant-to-ruminant feed ban that is in place and is 
effectively enforced.
    (2) In regions where BSE was detected, conducted an epidemiological 
investigation following detection of BSE sufficient to confirm the 
adequacy of measures to prevent the further introduction or spread of 
BSE, and continues to take such measures.
    (3) In regions where BSE was detected, took additional risk 
mitigation measures, as necessary, following the BSE outbreak based on 
risk analysis of the outbreak, and continues to take such measures.
    Cervid. All members of the family Cervidae and hybrids, including 
deer, elk, moose, caribou, reindeer, and related species.
* * * * *
    Food Safety and Inspection Service. The Food Safety and Inspection 
Service (FSIS) of the United States Department of Agriculture.
* * * * *
    Personal use. Only for personal consumption or display and not 
distributed further or sold.
* * * * *
    Positive for a transmissible spongiform encephalopathy. A sheep or 
goat for which a diagnosis of a transmissible spongiform encephalopathy 
has been made.
* * * * *
    Specified risk materials (SRMs). Those bovine parts considered to 
be at particular risk of containing the bovine spongiform 
encephalopathy (BSE) agent in infected animals, as listed in the FSIS 
regulations at 9 CFR 310.22(a).
    Suspect for a transmissible spongiform encephalopathy. (1) A sheep 
or goat that has tested positive for a transmissible spongiform 
encephalopathy or for the proteinase resistant protein associated with 
a transmissible spongiform encephalopathy, unless the animal is 
designated as positive for a transmissible spongiform encephalopathy; 
or
    (2) A sheep or goat that exhibits any of the following signs and 
that has been determined to be suspicious for a transmissible 
spongiform encephalopathy by a veterinarian: Weight loss despite 
retention of appetite; behavior abnormalities; pruritus (itching); wool 
pulling; biting at legs or side; lip smacking; motor abnormalities such 
as incoordination, high stepping gait of forelimbs, bunny hop movement 
of rear legs, or swaying of back end; increased sensitivity to noise 
and sudden movement; tremor, ``star gazing,'' head pressing, 
recumbency, or other signs of neurological disease or chronic wasting.
* * * * *


Sec.  94.1  [Amended]

0
9. In Sec.  94.1, paragraph (b)(4) and the introductory text to 
paragraph (d) are amended by removing the reference to ``Sec.  94.21'' 
each time it appears and adding in its place a reference to ``Sec.  
94.22''.

0
10. Section 94.18 is amended as follows:
0
a. In paragraph (a)(1), the word ``Canada,'' is removed.
0
b. Paragraph (a)(3) is redesignated as paragraph (a)(4) and newly 
redesignated paragraph (a)(4) is revised to read as set forth below.
0
c. A new paragraph (a)(3) is added, and paragraph (b) and the 
introductory text of paragraph (c) are revised, to read as set forth 
below.
0
d. In paragraph (d), the introductory text and paragraph (d)(3) are 
revised and a new paragraph (d)(5) is added to read as set forth below.


Sec.  94.18  Restrictions on importation of meat and edible products 
from ruminants due to bovine spongiform encephalopathy.

    (a) * * *
    (3) The following are minimal-risk regions with regard to bovine 
spongiform encephalopathy: Canada.
    (4) A region may request at any time that the Administrator 
consider its removal from a list in paragraphs (a)(1) or (a)(2) of this 
section, or its addition to or removal from the list in paragraph 
(a)(3) of this section, by following the procedures in part 92 of this 
subchapter.
    (b) Except as provided in paragraph (d) of this section or in Sec.  
94.19, the importation of meat, meat products, and edible products 
other than meat (except for gelatin as provided in paragraph (c) of 
this section, milk, and milk products) from ruminants that have been in 
any of the regions listed in paragraph (a) of this section is 
prohibited.
    (c) Gelatin. The importation of gelatin derived from ruminants that 
have been in any region listed in paragraph (a) of this section is 
prohibited unless the following conditions or the conditions of Sec.  
94.19(f) have been met:
* * * * *
    (d) Transit shipment of articles. Meat, meat products, and edible 
products other than meat that are prohibited importation into the 
United States in accordance with this section may transit air and ocean 
ports in the United States for immediate export if the conditions of 
paragraph (d)(1) through (d)(4) of this section are met. If such 
commodities are derived from bovines, sheep, or goats from a region 
listed in paragraph (a)(3) of this section, they are eligible to 
transit the United States by overland transportation if the 
requirements of paragraphs (d)(1) through (d)(5) of this section are 
met:
* * * * *
    (3) The person moving the articles must notify, in writing, the 
inspector at both the place in the United States where the articles 
will arrive and the port of export before such transit. The 
notification must include the:
* * * * *
    (5) The commodities must be eligible to enter the United States in 
accordance with Sec.  94.19 and must be accompanied by the 
certification required by that section. Additionally, the following 
conditions must be met:
    (i) The shipment must be exported from the United States within 7 
days of its entry;
    (ii) The commodities must not be transloaded while in the United 
States;
    (iii) A copy of the import permit required under paragraph (d)(1) 
of this section must be presented to the inspector at the port of 
arrival and the port of export in the United States.
* * * * *


Sec. Sec.  94.19 through 94.25  [Redesignated as Sec. Sec.  94.20 
through 94.26]

0
11. Sections 94.19 through 94.24 are redesignated as Sec. Sec.  94.20 
through 94.26, respectively.

0
12. A new Sec.  94.19 is added to read as follows:


Sec.  94.19  Restrictions on importation from BSE minimal-risk regions 
of meat and edible products from ruminants.

    Except as provided in Sec.  94.18 and this section, the importation 
of meat, meat products, and edible products other than meat (excluding 
gelatin that meets the conditions of Sec.  94.18(c), milk, and milk 
products), from bovines, sheep, or goats that have been in any of the 
regions listed in Sec.  94.18(a)(3) is prohibited. The commodities 
listed in paragraphs (a) through (f) of this section may be imported 
from a region listed in

[[Page 551]]

Sec.  94.18(a)(3) if the conditions of this section are met; if (except 
for commodities described in paragraph (e) of this section) the 
commodities are accompanied by an original certificate of such 
compliance issued by a full-time salaried veterinary officer of the 
national government of the region of origin, or issued by a 
veterinarian designated or accredited by the national government of the 
region of origin and endorsed by a full-time salaried veterinary 
officer of the national government of the region of origin, 
representing that the veterinarian issuing the certificate was 
authorized to do so; and if all other applicable requirements of this 
part are met.
    (a) Meat, meat byproducts, and meat food products from bovines. The 
meat, meat byproduct, or meat food product, as defined by FSIS in 9 CFR 
301.2--that those terms as applied to bison shall have a meaning 
comparable to those provided in 9 CFR 301.2 with respect to cattle, 
sheep, and goats--is derived from bovines that have been subject to a 
ruminant feed ban equivalent to the requirements established by the 
U.S. Food and Drug Administration at 21 CFR 589.2000 and meets the 
following conditions:
    (1) The meat, meat byproduct, or meat food product is derived from 
bovines for which an air-injected stunning process was not used at 
slaughter; and
    (2) The SRMs and small intestine of the bovines were removed at 
slaughter.
    (b) Whole or half carcasses of bovines. The carcasses are derived 
from bovines for which an air-injected stunning process was not used at 
slaughter and that meet the following conditions:
    (1) The bovines are subject to a ruminant feed ban equivalent to 
the requirements established by the U.S. Food and Drug Administration 
at 21 CFR 589.2000; and
    (2) The SRMs and small intestine of the bovines were removed at 
slaughter.
    (c) Meat, meat byproducts, and meat food products from sheep or 
goats or other ovines or caprines. The meat, meat byproduct, or meat 
food product, as defined by FSIS in 9 CFR 301.2, is derived from ovines 
or caprines that are from a flock or herd subject to a ruminant feed 
ban equivalent to the requirements established by the U.S. Food and 
Drug Administration at 21 CFR 589.2000, that were less than 12 months 
of age when slaughtered, and that meet the following conditions:
    (1) The animals were slaughtered at a facility that either 
slaughters only sheep and/or goats or other ovines and caprines less 
than 12 months of age or complies with a segregation process approved 
by the national veterinary authority of the region of origin and the 
Administrator as adequate to prevent contamination or commingling of 
the meat with products not eligible for importation into the United 
States;
    (2) The animals did not test positive for and were not suspect for 
a transmissible spongiform encephalopathy;
    (3) The animals have not resided in a flock or herd that has been 
diagnosed with BSE; and
    (4) The animals' movement is not restricted within Canada as a 
result of exposure to a transmissible spongiform encephalopathy.
    (d) Carcasses of ovines and caprines. The carcasses are derived 
from ovines or caprines that are from a flock or herd subject to a 
ruminant feed ban equivalent to the requirements established by the 
U.S. Food and Drug Administration at 21 CFR 589.2000, that were less 
than 12 months of age when slaughtered, and that meet the following 
conditions:
    (1) The animals were slaughtered at a facility that either 
slaughters only sheep and/or goats or other ovines and caprines less 
than 12 months of age or complies with a segregation process approved 
by the national veterinary authority of the region of origin and the 
Administrator as adequate to prevent contamination or commingling of 
the meat with products not eligible for importation into the United 
States;
    (2) The animals did not test positive for and were not suspect for 
a transmissible spongiform encephalopathy;
    (3) The animals have not resided in a flock or herd that has been 
diagnosed with BSE; and
    (4) The animals' movement is not restricted within Canada as a 
result of exposure to a transmissible spongiform encephalopathy.
    (e) Meat or dressed carcasses of hunter-harvested wild sheep, 
goats, or other ruminants other than cervids. The meat or dressed 
carcass (eviscerated and the head is removed) is derived from a wild 
sheep, goat, or other ruminant other than a cervid and meets the 
following conditions:
    (1) The meat or dressed carcass is derived from an animal that has 
been legally harvested in the wild, as verified by proof such as a 
hunting license, tag, or the equivalent that the hunter must show to 
the United States Customs and Border Protection official; and
    (2) The animal from which the meat is derived was harvested within 
a jurisdiction specified by the Administrator for which the game and 
wildlife service of the jurisdiction has informed the Administrator 
either that the jurisdiction conducts no type of game feeding program, 
or has complied with, and continues to comply with, a ruminant feed ban 
equivalent to the requirements established by the U.S. Food and Drug 
Administration at 21 CFR 589.2000.
    (f) Gelatin other than that allowed importation under Sec.  
94.18(c). The gelatin is derived from the bones of bovines subject to a 
ruminant feed ban equivalent to the requirements established by the 
U.S. Food and Drug Administration at 21 CFR 589.2000 and from which 
SRMs and small intestine were removed.
    (g) Ports. All products to be brought into the United States under 
this section must, if arriving at a land border port, arrive at one of 
the following ports: Eastport, ID; Houlton, ME; Detroit (Ambassador 
Bridge), Port Huron, and Sault St. Marie, MI; International Falls, MN; 
Sweetgrass, MT; Alexandria Bay, Buffalo (Lewiston Bridge and Peace 
Bridge), and Champlain, NY; Pembina and Portal, ND; Derby Line and 
Highgate Springs, VT; and Blaine (Pacific Highway and Cargo Ops), 
Lynden, Oroville, and Sumas (Cargo), WA.

PART 95--SANITARY CONTROL OF ANIMAL BYPRODUCTS (EXCEPT CASINGS), 
AND HAY AND STRAW, OFFERED FOR ENTRY INTO THE UNITED STATES

0
13. The authority citation for part 95 continues to read as follows:

    Authority: 7 U.S.C. 8301-8317; 21 U.S.C. 136 and 136a; 31 U.S.C. 
9701; 7 CFR 2.22, 2.80, and 371.4.


0
14. Section 95.1 is amended by revising the definition of inspector and 
adding new definitions of bovine, bovine spongiform encephalopathy 
(BSE) minimal-risk region, offal, positive for a transmissible 
spongiform encephalopathy, specified risk materials (SRMs), and suspect 
for a transmissible spongiform encephalopathy, in alphabetical order, 
to read as follows:


Sec.  95.1  Definitions.

* * * * *
    Bovine. Bos taurus, Bos indicus, and Bison bison.
    Bovine spongiform encephalopathy (BSE) minimal-risk region. A 
region listed in Sec.  94.18(a)(3) of this subchapter.
* * * * *
    Inspector. Any individual authorized by the Administrator of APHIS 
or the Commissioner of Customs and Border Protection, Department of 
Homeland

[[Page 552]]

Security, to enforce the regulations in this part.
* * * * *
    Offal. The inedible parts of a butchered animal that are removed in 
dressing, consisting largely of the viscera and the trimmings, which 
may include, but are not limited to, brains, thymus, pancreas, liver, 
heart, kidney.
    Positive for a transmissible spongiform encephalopathy. A sheep or 
goat for which a diagnosis of a transmissible spongiform encephalopathy 
has been made.
* * * * *
    Specified risk materials (SRMs). Those bovine parts considered to 
be at particular risk of containing the bovine spongiform 
encephalopathy (BSE) agent in infected animals, as listed in the FSIS 
regulations at 9 CFR 310.22(a).
    Suspect for a transmissible spongiform encephalopathy. (1) A sheep 
or goat that has tested positive for a transmissible spongiform 
encephalopathy or for the proteinase resistant protein associated with 
a transmissible spongiform encephalopathy, unless the animal is 
designated as positive for a transmissible spongiform encephalopathy; 
or
    (2) A sheep or goat that exhibits any of the following signs and 
that has been determined to be suspicious for a transmissible 
spongiform encephalopathy by a veterinarian: Weight loss despite 
retention of appetite; behavior abnormalities; pruritus (itching); wool 
pulling; biting at legs or side; lip smacking; motor abnormalities such 
as incoordination, high stepping gait of forelimbs, bunny hop movement 
of rear legs, or swaying of back end; increased sensitivity to noise 
and sudden movement; tremor, ``star gazing,'' head pressing, 
recumbency, or other signs of neurological disease or chronic wasting.
* * * * *

0
15. Section 95.4 is amended as follows:
0
a. In paragraph (a) introductory text, the words ``paragraphs (c) 
through (f)'' are removed and the words ``paragraphs (c) through (h)'' 
are added in their place.
0
b. In paragraph (b), the words ``paragraphs (d) and (f)'' are removed 
and the words ``paragraphs (d) and (h)'' are added in their place.
0
c. In paragraph (c)(4), the first sentence is revised and a new 
sentence is added after the final sentence to read as set forth below.
0
d. Paragraph (c)(6) is revised to read as set forth below.
0
e. Paragraph (f) is redesignated as paragraph (h).
0
f. New paragraphs (f) and (g) are added to read as set forth below.
0
g. In newly redesignated paragraph (h), the introductory text, 
paragraph (h)(3) introductory text, and paragraph (h)(4) are revised to 
read as set forth below.


Sec.  95.4  Restrictions on the importation of processed animal 
protein, offal, tankage, fat, glands, certain tallow other than tallow 
derivatives, and serum due to bovine spongiform encephalopathy.

* * * * *
    (c) * * *
    (4) Except for facilities in regions listed in Sec.  94.18(a)(3) of 
this subchapter, if the facility processes or handles any material 
derived from mammals, the facility has entered into a cooperative 
service agreement executed by the operator of the facility and APHIS. * 
* * In facilities in regions listed in Sec.  94.18(a)(3) of this 
subchapter, the inspections that would otherwise be conducted by APHIS 
must be conducted at least annually by a representative of the 
government agency responsible for animal health in the region.
* * * * *
    (6) Each shipment to the United States is accompanied by an 
original certificate signed by a full-time, salaried veterinarian of 
the government agency responsible for animal health in the region of 
origin certifying that the conditions of paragraph (c)(1) through 
(c)(3) of this section have been met, except that, for shipments of 
animal feed from a region listed in Sec.  94.18(a)(3) of this 
subchapter, the certificate may be signed by a person authorized to 
issue such certificates by the veterinary services of the national 
government of the region of origin.
* * * * *
    (f) Tallow otherwise prohibited importation under paragraph (a)(1) 
of this section may be imported into the United States if it meets the 
following conditions:
    (1) The tallow is derived from bovines that have not been in a 
region listed in Sec.  94.18(a)(1) or (a)(2) of this subchapter;
    (2) The tallow is composed of less than 0.15 percent insoluble 
impurities;
    (3) After processing, the tallow was not exposed to or commingled 
with any other animal origin material; and
    (4) Each shipment to the United States is accompanied by an 
original certificate signed by a full-time salaried veterinary officer 
of the national government of the region of origin, or issued by a 
veterinarian designated by or accredited by the national government of 
the region of origin and endorsed by a full-time salaried veterinary 
officer of the national government of the region of origin, 
representing that the veterinarian issuing the certificate was 
authorized to do so. The certificate must state that the requirements 
of paragraphs (f)(1) through (f)(3) of this section have been met; and
    (5) The shipment, if arriving at a U.S. land border port, arrives 
at a port listed in Sec.  94.19(g) of this subchapter.
    (g) Offal that is otherwise prohibited importation under paragraph 
(a)(1) of this section may be imported if the offal is derived from 
cervids or the offal is derived from bovines, ovines, or caprines from 
a region listed in Sec.  94.18(a)(3) of this subchapter that have not 
been in a region listed in Sec.  94.18(a)(1) or (a)(2) of this 
subchapter, and the following conditions are met:
    (1) If the offal is derived from bovines, the offal:
    (i) Contains no SRMs and is derived from bovines from which the 
SRMs and small intestine were removed;
    (ii) Is derived from bovines for which an air-injected stunning 
process was not used at slaughter; and
    (iii) Is derived from bovines that are subject to a ruminant feed 
ban equivalent to the requirements established by the U.S. Food and 
Drug Administration at 21 CFR 589.2000;
    (2) If the offal is derived from ovines or caprines, the offal:
    (i) Is derived from ovines or caprines that were less than 12 
months of age when slaughtered and that are from a flock or herd 
subject to a ruminant feed ban equivalent to the requirements 
established by the U.S. Food and Drug Administration at 21 CFR 
589.2000;
    (ii) Is not derived from ovines or caprines that have tested 
positive for or are suspect for a transmissible spongiform 
encephalopathy;
    (iii) Is not derived from animals that have resided in a flock or 
herd that has been diagnosed with BSE; and
    (iv) Is derived from ovines or caprines whose movement was not 
restricted in the BSE minimal-risk region as a result of exposure to a 
transmissible spongiform encephalopathy.
    (3) Each shipment to the United States is accompanied by an 
original certificate signed by a full-time salaried veterinary officer 
of the national government of the region of origin, or issued by a 
veterinarian designated by or accredited by the national government of 
the region of origin and endorsed by a full-time salaried veterinary 
officer of the national government of the region of origin, 
representing that the veterinarian issuing the certificate was 
authorized to do so. The certificate must state that the requirements 
of paragraph (g)(1) or (g)(2) of this section have been met; and

[[Page 553]]

    (4) The shipment, if arriving at a U.S. land border port, arrives 
at a port listed in Sec.  94.19(g) of this subchapter.
    (h) Transit shipment of articles. Articles that are prohibited 
importation into the United States in accordance with this section may 
transit air and ocean ports in the United States for immediate export 
if the conditions of paragraphs (h)(1) through (h)(3) of this section 
are met. If such commodities are derived from bovines, sheep, or goats 
from a region listed inSec.  94.18(a)(3) of this subchapter, they are 
eligible to transit the United States by overland transportation if the 
requirements of paragraphs (h)(1) through (h)(4) of this section are 
met:
* * * * *
    (3) The person moving the articles notifies, in writing, the 
inspector at both the place in the United States where the articles 
will arrive and the port of export before such transit. The 
notification includes the following:
* * * * *
    (4) The articles are eligible to enter the United States in 
accordance with this section and are accompanied by the certification 
required by this section. Additionally, the following conditions must 
be met:
    (i) The shipment is exported from the United States within 7 days 
of its entry;
    (ii) The commodities are not transloaded while in the United 
States;
    (iii) A copy of the import permit required under paragraph (h)(2) 
of this section is presented to the inspector at the port of arrival 
and the port of export in the United States.
* * * * *

PART 96--RESTRICTION OF IMPORTATIONS OF FOREIGN ANIMAL CASINGS 
OFFERED FOR ENTRY INTO THE UNITED STATES

0
16. The authority citation for part 96 continues to read as follows:

    Authority: 7 U.S.C. 8301-8317; 21 U.S.C. 136 and 136a; 7 CFR 
2.22, 2.80, and 371.4.


0
17. In Sec.  96.1, a definition of authorized inspector is added in 
alphabetical order to read as follows:


Sec.  96.1  Definitions.

* * * * *
    Authorized inspector. Any individual authorized by the 
Administrator of APHIS or the Commissioner of Customs and Border 
Protection, Department of Homeland Security, to enforce the regulations 
in this subpart.
* * * * *

0
18. In Sec.  96.2, paragraph (b) is revised to read as follows:


Sec.  96.2  Prohibition of casings due to African swine fever and 
bovine spongiform encephalopathy.

* * * * *
    (b) Bovine or other ruminant casings. The importation of casings, 
except stomachs, from bovines and other ruminants that originated in or 
were processed in any region listed in Sec.  94.18(a) this subchapter 
is prohibited, except that casings derived from sheep that were 
slaughtered in a region listed in Sec.  94.18(a)(3) of this subchapter 
at less than 12 months of age and that were from a flock subject to a 
ruminant feed ban equivalent to the requirements established by the 
U.S. Food and Drug Administration at 21 CFR 589.2000 may be imported, 
provided the casings are accompanied by a certificate that states that 
the casings were derived from sheep that met the conditions of this 
paragraph and that meets the following conditions:
    (1) The certificate is written in English;
    (2) The certificate is signed by an individual eligible to issue 
the certificate required under Sec.  96.3; and
    (3) The certificate is presented to an authorized inspector at the 
port of arrival.
* * * * *

0
19. In Sec.  96.3, a new paragraph (d) is added to read as follows:


Sec.  96.3  Certificate for Animal Casings.

* * * * *
    (d) In addition to meeting the other requirements of this section, 
the certificate accompanying sheep casings from a region listed in 
Sec.  94.18(a)(3) of this subchapter must state that the sheep from 
which the casings were derived were less than 12 months of age when 
slaughtered and were subject to a ruminant feed ban equivalent to the 
requirements established by the U.S. Food and Drug Administration at 21 
CFR 589.2000.
* * * * *

    Done in Washington, DC, this 27th day of December 2004 .
Bill Hawks,
Under Secretary for Marketing and Regulatory Programs.
[FR Doc. 04-28593 Filed 12-29-04; 3:00 pm]
BILLING CODE 3410-34-P