[Federal Register Volume 72, Number 236 (Monday, December 10, 2007)]
[Rules and Regulations]
[Pages 69569-69572]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-23880]



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  Federal Register / Vol. 72, No. 236 / Monday, December 10, 2007 / 
Rules and Regulations  

[[Page 69569]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 205

[Docket Number AMS-TM-07-0112; TM-06-04FR]
RIN 0581-AC61


National Organic Program (NOP); Amendments to the National List 
of Allowed and Prohibited Substances (Crops and Livestock)

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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

SUMMARY: This final rule amends the U.S. Department of Agriculture's 
(USDA) National List of Allowed and Prohibited Substances (National 
List) regulations to reflect recommendations submitted to the Secretary 
of Agriculture (Secretary) by the National Organic Standards Board 
(NOSB) on August 17, 2005. Consistent with the recommendations from the 
NOSB, this final rule adds one substance, along with any restrictive 
annotations, to two sections of the National List. This final rule also 
clarifies the use and prohibition of chitosan.

DATES: This rule becomes effective December 11, 2007.

FOR FURTHER INFORMATION CONTACT: Bob Pooler, Agricultural Marketing 
Specialist, Telephone: (202) 720-3252; Fax: (202) 205-7808.

SUPPLEMENTARY INFORMATION: 

I. Background.

    On December 21, 2000, the Secretary established, within the NOP (7 
CFR part 205), the National List regulations (Sec. Sec.  205.600 
through 205.607). The National List regulations identify synthetic 
substances and ingredients that are allowed and nonsynthetic (natural) 
substances and ingredients that are prohibited for use in organic 
production and handling. Under the authority of the Organic Foods 
Production Act of 1990 (OFPA), as amended, (7 U.S.C. 6501 et seq.), the 
National List can be amended by the Secretary based on proposed 
amendments developed by the NOSB. Since established, the National List 
has been amended five times, October 31, 2003 (68 FR 61987), November 
3, 2003 (68 FR 62215), October 21, 2005 (70 FR 61217), September 11, 
2006 (71 FR 53299), and June 27, 2007 (72 FR 35137). Additionally, an 
amendment to the National List, proposed on July 17, 2006 (71 FR 
40624), is currently pending.
    This final rule amends the National List to reflect recommendations 
submitted to the Secretary by the NOSB on August 17, 2005. On that date 
the NOSB recommended that the Secretary add one substance to Sec.  
205.601 and Sec.  205.603 of the National List regulations.

II. Overview of Amendments

    The following provides an overview of the amendments made to 
designated sections of the National List regulations:

Section 205.601 Synthetic Substances Allowed for Use in Organic Crop 
Production

    This final rule amends paragraph (e) of Sec.  205.601 of the 
National List regulations by adding Sucrose octanoate esters (CAS 
s--42922-74-7; 58064-47-4)--in accordance with approved 
labeling.

Section 205.603 Synthetic Substances Allowed for Use in Organic 
Livestock Production

    This final rule amends paragraph (b) of Sec.  205.603 of the 
National List regulations by adding Sucrose octanoate esters (CAS 
s--42922-74-7; 58064-47-4)--in accordance with approved 
labeling.

III. Related Documents

    One notice was published regarding the meeting of the NOSB and its 
deliberations on recommendations and substances petitioned for amending 
the National List. Substances and recommendations included in this 
final rule were announced for NOSB deliberation in Federal Register 
Notice 70 FR 43116, July 26, 2005, and published as a proposed rule on 
July 3, 2006 (71 FR 37854).

IV. Statutory and Regulatory Authority

    The OFPA, as amended (7 U.S.C. 6501 et seq.), authorizes the 
Secretary to make amendments to the National List based on proposed 
amendments developed by the NOSB. Sections 6518(k)(2) and 6518(n) of 
OFPA authorize the NOSB to develop proposed amendments to the National 
List for submission to the Secretary and establish a petition process 
by which persons may petition the NOSB for the purpose of having 
substances evaluated for inclusion on or deletion from the National 
List. The National List petition process is implemented under Sec.  
205.607 of the NOP regulations. The current petition process (72 FR 
2167, January 18, 2007) can be accessed through the NOP Web site at 
http://www.ams.usda.gov/nop.

A. Executive Order 12866

    This action has been determined not significant for purposes of 
Executive Order 12866, and therefore, has not been reviewed by the 
Office of Management and Budget.

B. Executive Order 12988

    Executive Order 12988 instructs each executive agency to adhere to 
certain requirements in the development of new and revised regulations 
in order to avoid unduly burdening the court system. This proposed rule 
is not intended to have a retroactive effect.
    States and local jurisdictions are preempted under the OFPA from 
creating programs of accreditation for private persons or State 
officials who want to become certifying agents of organic farms or 
handling operations. A governing State official would have to apply to 
USDA to be accredited as a certifying agent, as described in Sec.  
2115(b) of the OFPA (7 U.S.C. 6514(b)). States are also preempted under 
Sec. Sec.  2104 through 2108 of the OFPA (7 U.S.C. 6503 through 6507) 
from creating certification programs to certify organic farms or 
handling operations unless the State programs have been submitted to, 
and approved by, the Secretary as meeting the requirements of the OFPA.
    Pursuant to section 2108(b)(2) of the OFPA (7 U.S.C. 6507(b)(2)), a 
State organic certification program may contain additional requirements 
for the

[[Page 69570]]

production and handling of organically produced agricultural products 
that are produced in the State and for the certification of organic 
farm and handling operations located within the State under certain 
circumstances. Such additional requirements must: (a) Further the 
purposes of the OFPA, (b) not be inconsistent with the OFPA, (c) not be 
discriminatory toward agricultural commodities organically produced in 
other States, and (d) not be effective until approved by the Secretary.
    Pursuant to section 2120(f) of the OFPA (7 U.S.C. 6519(f)), this 
proposed rule would not alter the authority of the Secretary under the 
Federal Meat Inspection Act (21 U.S.C. 601 et seq.), the Poultry 
Products Inspections Act (21 U.S.C. 451 et seq.), or the Egg Products 
Inspection Act (21 U.S.C. 1031 et seq.), concerning meat, poultry, and 
egg products, nor any of the authorities of the Secretary of Health and 
Human Services under the Federal Food, Drug and Cosmetic Act (21 U.S.C. 
301 et seq.), nor the authority of the Administrator of the 
Environmental Protection Agency (EPA) under the Federal Insecticide, 
Fungicide and Rodenticide Act (FIFRA) (7 U.S.C. 136 et seq.).
    Section 2121 of the OFPA (7 U.S.C. 6520) provides for the Secretary 
to establish an expedited administrative appeals procedure under which 
persons may appeal an action of the Secretary, the applicable governing 
State official, or a certifying agent under this title that adversely 
affects such person or is inconsistent with the organic certification 
program established under this title. The OFPA also provides that the 
U.S. District Court for the district in which a person is located has 
jurisdiction to review the Secretary's decision.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.) 
requires agencies to consider the economic impact of each rule on small 
entities and evaluate alternatives that would accomplish the objectives 
of the rule without unduly burdening small entities or erecting 
barriers that would restrict their ability to compete in the market. 
The purpose is to fit regulatory actions to the scale of businesses 
subject to the action. Section 605 of the RFA allows an agency to 
certify a rule, in lieu of preparing an analysis, if the rulemaking is 
not expected to have a significant economic impact on a substantial 
number of small entities.
    Pursuant to the requirements set forth in the RFA, the Agricultural 
Marketing Service (AMS) performed an economic impact analysis on small 
entities in the final rule published in the Federal Register on 
December 21, 2000 (65 FR 80548). AMS has also considered the economic 
impact of this action on small entities. The impact on entities 
affected by this final rule would not be significant. The effect of 
this final rule would be to allow the use of additional substances in 
agricultural production and handling. This action would relax the 
regulations published in the final rule and would provide small 
entities with more tools to use in day-to-day operations. AMS concludes 
that the economic impact of this addition of allowed substances, if 
any, would be minimal and entirely beneficial to small agricultural 
service firms. Accordingly, USDA certifies that this rule will not have 
a significant economic impact on a substantial number of small 
entities.
    Small agricultural service firms, which include producers, 
handlers, and accredited certifying agents, have been defined by the 
Small Business Administration (SBA) (13 CFR 121.201) as those having 
annual receipts of less than $6,500,000 and small agricultural 
producers are defined as those having annual receipts of less than 
$750,000. This final rule would have an impact on a substantial number 
of small entities.
    The U.S. organic industry at the end of 2001 included nearly 6,949 
certified organic crop and livestock operations. Data on the numbers of 
certified organic handling operations (any operation that transforms 
raw product into processed products using organic ingredients) were not 
available at the time of survey in 2001; but they were estimated to be 
in the thousands. By the end of 2006, the number of certified organic 
crop, livestock, and handling operations totaled over 14,800 operations 
based on reports by certifying agents to the NOP as part of their 
annual reporting requirements. AMS believes that most of these entities 
would be considered small entities under the criteria established by 
the SBA.
    U.S. sales of organic food and beverages have grown from $1 billion 
in 1990 to an estimated $12.2 billion in 2004, $13.8 billion in 2005, 
and nearly $17 billion in 2006. The organic industry is viewed as the 
fasting growing sector of agriculture, representing almost 3 percent of 
overall food and beverage sales. Since 1990, organic retail sales have 
historically demonstrated a growth rate between 20 to 24 percent each 
year including a 22 percent increase in 2006.
    In addition, USDA has 98 accredited certifying agents (ACAs) who 
provide certification services to producers and handlers. A complete 
list of names and addresses of accredited certifying agents may be 
found on the NOP Web site, at http://www.ams.usda.gov/nop. AMS believes 
that most of these entities would be considered small entities under 
the criteria established by the SBA.

D. Paperwork Reduction Act

    No additional collection or recordkeeping requirements are imposed 
on the public by this final rule. Accordingly, OMB clearance is not 
required by section 350(h) of the Paperwork Reduction Act of 1995, 44 
U.S.C. 3501, et seq., or OMB's implementing regulations at 5 CFR part 
1320.
    AMS 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.

E. Discussion of Comments Received

    Eleven (11) comments were received on proposed rule TM-06-04. 
Comments were submitted by two (2) non-profit organizations, one (1) 
state department of agriculture, one (1) private certifying agent, and 
seven (7) consumers. One additional consumer comment was received but 
because it addresses grass fed beef it was not considered in this 
rulemaking. The comments can be viewed at http://www.ams.usda.gov/nop/PublicComments/NLAmendmentsCrops&LSTM=06=04/PublicCommentsCrops&LivestockTM=06=04.html.
Sucrose Octanoate Esters
    The seven (7) consumer comments opposed adding sucrose octanoate 
esters (SOE) to Sec. Sec.  205.601 and 205.603 on the grounds that they 
oppose the use of pesticides. Two other commenters favored the addition 
of SOE to Sec. Sec.  205.601 and 205.603. The remaining two (2) 
commenters did not address the addition of SOE and were assumed to take 
no position regarding its addition to Sec. Sec.  205.601 and 205.603.
    The seven (7) consumer comments provided brief statements of 
opposition, to adding sucrose octanoate esters, expressed as one or 
more of the following reasons: (1) Organic implies that no pesticides 
were used, (2) the evidence cited is not convincing that sucrose is 
safe, (3) organic does and should indicate that the substance is 
unaltered, (4) no pesticides should be allowed in food labeled 
certified organic, (5) do not favor pollution of

[[Page 69571]]

organic standards, (6) if special warnings come with the synthetic how 
can it be used in organic production, and (7) people who buy organic 
foods do so because they want food that is free of substances they 
would not normally ingest.
    We have considered these comments. The OFPA and NOP regulations 
allow for the use of certain pesticides that have been reviewed and 
evaluated for inclusion on the National List by the NOSB.
    In organic crop and livestock production, insect pests are 
controlled primarily through management practices including physical, 
mechanical, and biological controls. When these practices are not 
sufficient, a biological, botanical, or synthetic substance approved 
for use on the National List may be used. To be added to the National 
List the OFPA requires that the NOSB review the substance against the 
criteria established under 7 U.S.C. 6517 and 6518. At its August 17, 
2005, meeting in Washington, DC, the NOSB evaluated SOE against the 
evaluation criteria of 7 U.S.C. 6517 and 6518 of the OFPA, received 
public comment, and concluded that SOE is consistent with the OFPA 
evaluation criteria. Accordingly, the NOSB recommended adding SOE to 
the National List for use in organic crop and livestock production as 
an insecticide/miticide.
    SOE was petitioned for use in organic crop and livestock production 
as an insecticide/miticide. SOE exists as an amber-colored liquid. The 
mixture of esters is manufactured from two biochemicals--sucrose (table 
sugar) and an octanoic acid ester (commonly found in plants and 
animals). The active ingredient acts by dissolving the waxy protective 
coating (cuticle) of target pests, causing the insect or mite to dry 
out and die.
    Under FIFRA, the EPA has registered SOE as a biochemical that 
targets mites and certain soft-bodied insects (e.g., aphids) at three 
distinct commercial sites: Food and non-food crops, including certain 
ornamentals; media for growing mushrooms; and adult honey bees (http://www.epa.gov/oppbppd1/biopesticides/ingredients/factsheets/factsheet_035300.htm). In assessing risks to human health, the EPA has concluded 
that no risks to humans are expected from the use of SOE as a pesticide 
active ingredient. SOE are not toxic to mammals, but in high 
concentrations, they are corrosive to the eye. To avoid irreversible 
eye damage, exposed workers are required to wear appropriate protective 
clothing. In assessing risks to the environment, the EPA determined 
that no risks to the environment are expected from the use of SOE in 
pesticide products because: (a) The esters biodegrade rapidly and 
therefore do not persist in the environment, (b) the esters are not 
toxic to mammals or other non-target organisms, (c) organisms are 
already exposed because these sucrose esters are found in plants, and 
(d) the tiny amounts used in pesticide products are not expected to 
substantially increase the amount of these esters in the environment.
    The NOP consulted with the EPA and Food and Drug Administration 
(FDA) to ensure that the NOSB recommendation for the use of SOE in 
organic crop and livestock production would be consistent with Federal 
regulations governing the use of the substance. The EPA informed the 
NOP that the recommended use of SOE in organic crop and livestock 
production is consistent with EPA regulations. The FDA likewise 
confirmed that the referenced sucrose octanoate ester product is 
appropriately licensed by the EPA for its use.
    In consideration of the preceding information the NOP has decided 
to add SOE to Sec. Sec.  205.601 and 205.603.
Chitosan
    In the July 3, 2006, proposed rule (71 FR 37854), the NOP stated it 
``will not propose to specifically add chitosan to the National List as 
an adjuvant, it is already permitted for use at Sec.  205.601(m) of the 
National List regulations.'' Comments were received regarding this 
statement and, as a result, the NOP is clarifying the use and 
prohibition of chitosan in organic agriculture.
    Chitosan (Poly-D Glucosamine) (CAS -9012-76-04) was 
petitioned for use in organic crop production as an adhesive adjuvant 
to be used with fungicides approved for use under the NOP regulations. 
At its August 17, 2005, meeting in Washington, DC, the NOSB recommended 
adding chitosan to the National List for use in organic crop production 
as an insecticide, with the restriction that it only be used as an 
adjuvant. In this open meeting, the NOSB evaluated chitosan against the 
evaluation criteria of 7 U.S.C. 6517 and 6518 of the OFPA, received 
public comment, and concluded that chitosan is consistent with the OFPA 
evaluation criteria. The NOSB recommended restricting the use of 
chitosan to an adjuvant only, due to the fact that chitosan could also 
be used as a plant defense booster and plant growth enhancer.
    The NOP consulted with the EPA concerning the NOSB's recommendation 
to include chitosan on the National List for use as an adjuvant. The 
EPA stated that, in addition to chitosan being registered as an active 
ingredient, it is also approved as an EPA List 4B inert ingredient. The 
EPA further informed the NOP that chitosan, used as an adjuvant, would 
be considered an inert ingredient. The NOP regulations, at Sec.  
205.601(m), permits the use of EPA List 4 inert ingredients with 
nonsynthetic substances or synthetic substances approved for use under 
the NOP regulations as an active pesticide ingredient. As a result, the 
NOP stated ``it will not propose to specifically add chitosan to the 
National List as an adjuvant; it is already permitted for use at Sec.  
205.601(m) of the National List regulations.''
    The two (2) non-profit organizations, one (1) state department of 
agriculture, and one (1) private certifying agent commented on the 
decision not to add chitosan for use in organic crop production as an 
adhesive adjuvant to be used with fungicides approved for use under the 
NOP regulations. The commenters did not oppose NOP's decision but 
requested further explanation and elaboration on the factors that led 
to that determination.
    One commenter agreed that chitosan should be considered approved 
for use as a List 4 inert ingredient under 205.601(m)(l). The commenter 
believed that such an interpretation would allow for the use of 
chitosan as an inert ingredient when it is a component of a final 
product, e.g. listed as an inert ingredient in a Brand Name material 
and functions as an adjuvant. However, the same commenter noted that 
the NOP proposal to not specifically add chitosan to the National List 
may pose challenges for some organic operators in some states because a 
spray ``adjuvant'' (inert ingredient) may be regulated as a 
``pesticide'' (active ingredient) in varying states. As a result, the 
commenter suggested that the NOP modify language in 205.601 (m) to 
explicitly recognize that ``adjuvants classified by the EPA,'' along 
with inerts, are allowed to be combined with nonysnthetic or synthetic 
substances approved for use in organic production.
    We considered all of the comments. In addition to the comments, we 
consulted further with the EPA concerning the use of chitosan as an 
adjuvant. The EPA confirmed, as they had before, that chitosan, in 
addition to its approved use as an active ingredient and plant defense 
booster/plant growth regulator (enhancer), is also approved as an EPA 
List 4B inert ingredient. It also reiterated

[[Page 69572]]

that chitosan could be used as an adjuvant and that adjuvants are 
considered inert ingredients under the EPA. However, in cases where 
chitosan would be combined with a fungicide, chitosan could not be 
considered an inert ingredient or adjuvant, because chitosan has active 
fungicidal properties and is labeled for use against fungal diseases 
such as blight. The EPA also commented that for chitosan to be 
considered an inert or adjuvant in a formulation, it could not exhibit 
pesticidal activity. In that regard, the EPA determined that it could 
not verify that chitosan does not have any fungicidal activity for the 
intended use and at the proposed levels mentioned in the petition; data 
does not support its non-fungicidal activity in such a use.
    In addition to the concerns raised about chitosan's use as an 
adjuvant in combination with another fungicide, the issue of whether 
chitosan should be considered an insecticide (as recommended by the 
NOSB) or a plant disease control was mentioned. The EPA informed the 
NOP that data does not reveal chitosan having insecticidal properties. 
Instead, chitosan is considered more of a systemic acquired response 
inducer and demonstrates fungicidal activity. As a result, for the 
purpose of the NOP regulations, chitosan would be better characterized 
as a plant disease control.
    Based on the information submitted through public comment and 
gathered in further consultation with the EPA, we have determined that 
chitosan, when used in combination with another fungicide, cannot be 
considered an inert or adjuvant. It is considered an active ingredient 
in such cases. However, in cases where chitosan is used in combination 
with an approved active ingredient on the National List and does not 
demonstrate any pesticidal/fungicidal activity, it could be considered 
an inert ingredient or adjuvant.
    The preceding chitosan discussion is summarized as follows:
    Chitosan was petitioned for use in organic crop production as an 
adhesive ``adjuvant'' to be used with fungicides approved for use under 
the NOP regulations. The NOSB recommended adding chitosan to the 
National List for use in organic crop production as an ``insecticide,'' 
with the restriction that it only be used as an ``adjuvant.'' The EPA 
informed the NOP that data does not reveal chitosan having insecticidal 
properties. Because the NOSB recommended the use of chitosan as an 
adjuvant, the recommendation restricts the use of the substance to the 
capacity of an inert ingredient. AMS, in consultation with EPA, has 
determined that chitosan, when used as an ``adjuvant'' (not 
demonstrating any pesticidal activity), is already allowed under the 
existing inert ingredient provisions of Sec.  205.601(m) of the NOP 
regulations. However, chitosan, when used in combination with a 
fungicide, cannot be considered an inert or adjuvant, because chitosan 
has fungicidal properties and is considered an active ingredient in 
such cases. Accordingly, unless specifically added to Sec.  205.601 of 
the National List as an active ingredient, chitosan cannot be used with 
a fungicide.
    Therefore, AMS has decided to refer the chitosan recommendation 
back to the NOSB so that it can reconsider the intended use of the 
substance and its inclusion on the National List (i.e., should it be 
considered a plant disease control; and should it be included on the 
National List as an approved active ingredient?). In the meantime, 
chitosan, under the inert ingredient provisions of Sec.  205.601(m) of 
the NOP regulations, can be used as an ``adjuvant'' (not demonstrating 
any pesticidal activity) in combination with approved active 
ingredients on the National List, provided the approved active 
ingredient is not a registered fungicide. Chitosan, when used in 
combination with a fungicide, is an active ingredient and remains a 
prohibited substance that shall not be used in organic agriculture. 
Further, chitosan remains prohibited for use as a plant defense 
booster, a plant growth enhancer, and as an active ingredient in any 
other capacity. If readers have questions concerning when a substance 
qualifies to be an active or inert ingredient, they should contact the 
EPA for further information and guidance.

F. Effective Date

    This final rule reflects recommendations submitted to the Secretary 
by the NOSB. The substance being added to the National List was based 
on a petition from the industry and evaluated by the NOSB using 
criteria in the Act and the regulations. Because this substance is 
crucial to organic crop and livestock production operations, producers 
should be able to use them in their operations as soon as possible. 
Accordingly, AMS finds that good cause exists under 5 U.S.C. 553(d)(3) 
for not postponing the effective date of this rule until 30 days after 
publication in the Federal Register.

List of Subjects in 7 CFR Part 205

    Administrative practice and procedure, Agriculture, Animals, 
Archives and records, Imports, Labeling, Organically produced products, 
Plants, Reporting and recordkeeping requirements, Seals and insignia, 
Soil conservation.

0
For the reasons set forth in the preamble, 7 CFR part 205, subpart G is 
amended as follows:

PART 205--NATIONAL ORGANIC PROGRAM

0
1. The authority citation for 7 CFR part 205 continues to read as 
follows:

    Authority: 7 U.S.C. 6501-6522.


0
2. Section 205.601 is amended by adding new paragraph (e)(9) to read as 
follows:


Sec.  205.601  Synthetic substances allowed for use in organic crop 
production.

* * * * *
    (e) * * *
    (9) Sucrose octanoate esters (CAS s--42922-74-7; 58064-47-
4)--in accordance with approved labeling.
* * * * *

0
3. Section 205.603 is amended by adding new paragraph (b)(7) to read as 
follows:


Sec.  205.603  Synthetic substances allowed for use in organic 
livestock production.

* * * * *
    (b) * * *
    (7) Sucrose octanoate esters (CAS s--42922-74-7; 58064-47-
4)--in accordance with approved labeling.
* * * * *

    Dated: December 5, 2007.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E7-23880 Filed 12-7-07; 8:45 am]
BILLING CODE 3410-02-P