Public Health Security

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• Public Health Security
• and Bioterrorism Preparedness
• and Response Act of 2002
• Public Law 107-188
• Signed June 12, 2002

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PRESENTED TO

• LOS ANGELES CUSTOMS BROKERS FREIGHT FORWARDERS
• March 25, 2003

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• Four Changes of Primary Interest
• Administrative Detention
• Record Keeping
• Prior Notice
• Registration

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• Food may be detained if the FDA officer/employee
  has credible evidence or information such
  article presents a threat of serious adverse
  health consequences or death to humans or
  animals.
• The Port Director or someone higher within the
  agency is mandated to make the decision to detain
• Period of detention 20 or 30 days
• Shipment may be removed to secure storage but not
  delivered to the custody of the importer or his
  agent.

5

• There was no consultation with the trade
  community or the usual Congressional committees
  prior to enactment. The deal was cut during the
  House and Senate Conference process.
• After enactment, FDA sent a July 17, 2002 letter
  to stakeholders inviting comments regarding
  implementation. FDA also met with industry
  representatives, consumer groups, federal
  agencies and foreign embassies to further solicit
  comments.

6

• The basic themes of the comments submitted were
• Maintain flexibility when setting the time for
  notice and keep in mind the modes of
  transportation, the nature of perishable food and
  the needs of U.S. businesses which operate near
  the border
• Permit amendments
• Integrate Customs and other agencies to avoid
  duplications
• Allow qualified agents to submit prior notices
• Provide immediate acknowledgment electronically
• Define food
• Extend FDAs hours of operation
• Comply with international trade obligations
• Provide a model of the prior notice screen

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• FDA assumes that orders for food are placed at
  least one day prior to arrival and so a four (4)
  hour minimum notice period should not cause undue
  hardship.
• FDA wants to know how business operations will
  change - tomatoes, avocados oranges and similar
  products are subject to the Agricultural
  Marketing Agreement Act and must already give one
  day advance notice so they were basically ignored
  for purposes of these regulations what type of
  notice is involved for these ignored products?
• Deadline to issue regulations - December 12,
  2003
• FDA asked for comments on these provisions
  and others

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• Justification for these rules - if a bioterrorism
  outbreak occurs, prior notice would enhance
  FDAs ability to respond and prevent entry of
  related shipments and to facilitate product
  tracking for containment
• Prior notice advises the name of the actual
  importer and consignee in the U.S.
• - what about cargo not cleared?
• - what about in-bond cargo?
• Prior notice assists in determining the source
  and cause of problems and in communicating with
  affected firms
• It also assists FDA to use its foreign inspection
  resources more effectively

9

• Who must give notice?
• U.S. purchasers
• U.S. importers
• or their agents - brokers are named as
• possible agents, but should you?
• if in-bond goods - the carrier should submit!
• The submitter is responsible for ensuring the
• adequacy and accuracy of the prior notice

10

• Default notice period
• - not less than 8 hours and not more than 5
  days
• Must give notice by noon the calendar day before
  arrival, includes weekends and holidays
• - will FDA operate 24/7?
• Factors to consider -
• Effect on commerce
• Location of the ports
• Modes of transportation
• Types of food
• Other considerations including FDA is to leave
  enough time to receive, review and then
  appropriately respond.

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• FDA admits it does not have all the Customs ports
  of entry staffed and claims to need time to
  respond to the 20,000 prior notices it expects to
  receive daily.
• FDA examined 64 entry packages and determined
  the applicable time frames by comparing invoice
  dates with arrival dates.
• FDA admits the greatest impact will be on fresh
  items from Canada and Mexico and so agrees
  amendments will be needed as all the details may
  not be known by noon the day before shipment
  examples, fresh fish (exact species or quantity)
  or lettuce (exact variety or quantity). Topping
  off is no longer allowed.

12

• Prior notice is required for all food
• whether or not intended for human consumption
• whether or not remaining in the U.S.
• - in-bonds eliminated?
• - FTZ entries also affected

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• Exceptions -
• Food individual travelers carry in their luggage
  for their own use, i.e. not for sale - gift of
  Swiss chocolates
• Food subject to the jurisdiction of the USDA
• - Federal Meat Inspection Act
• - Poultry Products Inspection Act
• - Egg Products Inspection Act
• What about liquor? Is the 7 rule obsolete?

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• Definitions of concern -
• Country of shipment - where loaded onto the
  conveyance that brings it to the U.S. - what
  about intermediate destinations?
• Food - if an article can be employed for
  food and non-food uses, the food uses trigger the
  prior notice requirement.
• Originating country - country where the article
  originates - fresh vs. canned
• - fresh what about if bought through third
  parties? trading houses?
• - if canned, where grown? canned?
• - seafood - look to the flag of the vessel
  when caught ignore later processing ?
• Port of entry - where the food first arrives -
  not where it is entered.

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• If fail to file prior notice refused
  admission, e.g. if file untimely or the filing is
  inaccurate or incomplete refused
  admission.
• If refused admission, the food must be held at
  the port unless FDA directs it be moved to a
  secure facility may not store perishables at a
  bonded warehouse.

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• With mixed containers (food and non-food), any
  food refused admission must be dealt with before
  the rest of the contents moves.
• - what does that do to in-bond cargo?
• - what about cleared goods moving elsewhere?
• If FDA orders cargo to move, either the carrier
  or the person giving prior notice must arrange
  the movement under a custodial bond and notify
  FDA of the final location. However, the
  purchaser, owner, importer or consignee may also
  make arrangements to move the goods and remains
  responsible for the transportation and storage
  expenses.

17

• Refused admission under 801(m)(1) for prior
  notice problems is not the same as refused
  admission under 801(a) following entry.
• Failure to comply with the prior notice rules is
  subject to both criminal and civil penalties and
  is also a prohibited act. Debarment (denial of
  the right to import) is also possible following a
  felony conviction.

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• If refused admission under 801(m), there is no
  appeal procedure. The only way the food gets in
  is to provide the prior notice data and have it
  approved by FDA.
• If prior notice is not satisfied, the food will
  be sent G.O. and the usual Customs rules then
  apply, including the right to re-export.
• Delivery under a Customs bond is not allowed.

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• How To Submit Prior Notice
• Through FDAs Prior Notice System
• Under development
• Will be web-based
• October 12, 2003 target completion date
• Customs could not modify ACS to accommodate
  FDAs requirements
• Submit through ACE when it is operational
• FDA wants comments on -
• The extent to which duplicative prior notice
  information must
• be submitted to more than one agency
• Ways to minimize any duplicative efforts

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• Why a new electronic system?
• If none is created, FDA will be overwhelmed
• It provides instantaneous confirmation of receipt
• It ensures completion, but not accuracy
• Legibility is enhanced

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• If the new system doesnt work - submit in
  person, by fax or e-mail to the FDA field office
  with responsibility over the geographic area
  where the port of entry (arrival) is located.
• If submitting an amendment which changes the port
  of entry, submit it to the FDA office where the
  original filing was made, if done manually.
• Acknowledgment of prior notice is not an
  admissibility determination.

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• What must be reported?
• Each food that is represented by an FDA line or
  product code must be covered by a prior notice,
  e.g. four (4) different sizes of canned tuna
  equates to four (4) prior notices but may be
  contained in one submission.

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• The required data elements
• 1) Submitter - firm name, address, phone and fax
  numbers and e-mail address facility registration
  number if applicable.
• 2) Type of entry - entry code
• ACS entry line number and other Customs
  identification, e.g. type of entry - warehouse,
  TIB, in-bond.
• 3) Location where food is being held including
  when it will arrive there and who to contact at
  that location.

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• 4) Product identity -
• Complete FDA product code - provide what can
  and amend later if dont have all the data by
  notice deadline
• Cant self-blind - know or should know
  standard.
• 5) Common or usual market name - entry
  description
• 6) Trade or brand name - entry description

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• 7) Quantity - from smallest package to largest
  container
• FDA wants comments about how often quantity
  changes occur after the deadline and how
  significant are those changes.
• 8) Lot, code or other unique identifier
• 9) Manufacturer - entry data - seller vs. grower

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• 10) Grower and location - if known
• FDA wants comments on -
• - does the act give it flexibility to exempt or
  otherwise treat differently so-called processed
  foods produced with products from more than one
  grower?
• - does the term grower include a harvester or
  collector of wild products, e.g. fish or
  botanicals?

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• 11) Originating country - where the article
  originates
• - what does that mean?
• - substantial transformation doesnt count!
• 12) Shipper
• 13) Country of shipping
• 14) Anticipated arrival information
• Port of entry - first port of arrival
• Date and time of arrival
• Maybe updated - realistic time frames?

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• 15) Customs port of entry
• 16) Anticipated date of entry
• 17) Importer, owner and consignee
• 18) Carrier SCAC code - why?

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• Amendments Allowed After Filing -
• Arrival -
• Anticipated location port of entry
• Date and time of arrival
• Cant change mode of transportation
• What about delays?
• What about equipment failure?
• Window - must update if the arrival changes by
  more than one (1) hour earlier or more than
  three (3) hours later!
• Only once

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• Must transmit at least two hours prior to arrival
  
• - May be limited to certain types of food
• - Topping off is now eliminated if it involves
  food other than that previously transmitted.
• - FDA wants comments as to how often topping
  off occurs and the quantities involved.

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• Product Identity
• - Last two digits of the product code
• - Other product identity changes - variety or
  species
• - Cant change from lettuce to pears
• - Cant change root vegetables to carrots
• - Carrots have their own product code
• - Common, usual, trade or brand names
• - Lot or code of identification numbers
• - Quantity
• - Add grower if previously unknown, but cant
  change

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• Submit the update in the identical fashion as the
  original - electronic/electronic not
  electronic/fax.
• If fail to update
• Refused admission

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• For all other changes
• Cancel the original prior notice
• and
• Start all over again!

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• Goods refused admission must now be marked
  UNITED STATES REFUSED ADMISSION
• Anyone wanting to return those goods to the U.S.
  bears the burden of proving they are no longer
  contaminated
• Port shopping is now specifically prohibited

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Registration

• Who must register? Any facility, domestic or
  foreign, which manufactures, processes, packs or
  holds food for human or animal consumption in the
  U.S.
• - if a domestic facility, it must register even
  if its food does not enter interstate commerce
• FDA wants comments as to whether the Act extends
  to domestic facilities and, if so, whether it
  should require their registration. FDA also
  wants comments on the types of questions it might
  provide to domestic facilities to allow them to
  easily determine if they operate interstate or
  intrastate.
• Deadline is December 12, 2003

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• Purpose
• To provide FDA with information about the food
  supply in order to allow it to properly and
  timely respond to any bioterrorist attack and to
  allow it to determine the source and cause of
  such an event and allow the FDA to communicate
  with potentially affected facilities
• FDA wants to be able to track food backward to
  origin and forward to the consumer

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• The owner, operator or agent in charge of a
  facility must file the registration - currently
  125,450 foreign manufacturers are in OASIS
• If a U.S. agent is designated to handle the
  registration, it should have a written agreement
  with the foreign facility which details the
  responsibilities of the parties
• Transmission must include the name and address of
  each facility, all trade names if a foreign
  facility, identify the U.S. agent plus the
  identity of the general category of the food
  manufactured, processed, packed or held at the
  facility

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• Exception - if a foreign facility, and the food
  undergoes further processing or packing by
  another foreign facility however, if that
  further processing or packing is de minimis, e.g.
  attach a label or plastic strip for bottles, then
  both facilities must be registered

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• Excluded - farms (unless manufactures, processes,
  packs or holds for commercial purposes, compare
  to make animal feed for use on the farm vs.
  orange juice sold commercially), restaurants and
  other retail facilities, nonprofit food
  establishments and fishing vessels (except those
  involved in processing) also excluded is
  foodstuff subject to the Federal Meat Inspection
  Act, Poultry Products Inspection Act or the Egg
  Products Inspection Act.
• Registration is to done electronically
• Changes must be reported timely

40

• Registration seeks to reach the
• last processor
• last packager
• last packer
• last holder
• Key - significant activity with respect to the
  food

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• Fishing vessels - if any type of processing is
  done on board, it must be registered, i.e.,
  handling, storing, preparing, heading,
  eviscerating, shucking, freezing, changing into
  different market forms, manufacturing,
  preserving, packing, labeling, dockside unloading
  or holding.

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• If a facility is regulated by both USDA and FDA,
  it must register, e.g. makes t.v. dinners with
  both meat and fish in them.
• Facility is defined as one or several buildings
  all under the same management if under different
  management separate registration

43

• Food -
• Articles used for food or drink for man or other
  animals
• Chewing gum
• Articles used for components of any such articles

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• Examples of food
• Fruits
• Vegetables
• Fish
• Dairy products
• Eggs
• Raw agricultural commodities for use as food or
  components of food
• Animal feed, including pet food
• Food and feed ingredients and additives,
  including substances that migrate into food from
  food packaging and other articles that contact
  food

45

• Dietary supplements and dietary ingredients
• Infant formula
• Beverages, including alcoholic beverages and
  bottled water 7 rule?
• Live food animals such as hogs and elk
• Bakery goods
• Snack foods
• Candy and
• Canned foods
• Outer packaging is exempt

46

• Examples of holding facilities
• Warehouses
• Cold storage facilities
• Storage silos
• Grain elevators
• Liquid storage tanks

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• Examples of manufacturing/processing -
• making food from one or more ingredients, or
  synthesizing, preparing, treating, modifying or
  manipulating food, including food crops or
  ingredients
• Cutting, Peeling, Trimming, Washing,
  Waxing, Eviscerating, Rendering, Cooking,
  Baking, Freezing, Cooling, Pasteurizing,
  Homogenizing, Mixing, Formulating,
  Bottling, Milling, Grinding, Extracting,
  juice, Distilling, Labeling , Packaging
• Manufacturing and processing overlap - macaroni
  and cheese

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• Examples of packing
• placing, putting or repacking a food into
  different containers without making any change to
  the form of the food

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• U.S. Agent
• Must be a live body at a real address, not a
  P.O. box, mail drop or answering service
• Communications from the agent will be treated as
  coming from the foreign facility
• Communications from FDA to the agent will be
  treated as having been given to the foreign
  facility
• Should have a written agreement from the foreign
  facility which specifies the responsibilities of
  the parties
• Failure to have proper authorization 18 U.S.C.
  1001 violation
• Filing is to be done electronically through a
  link on the FDA website

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• Key date - October 12, 2003
• Either the new system will be up and running,
• or
• FDA will advise the address to send paper
  registration applications
• Electronic registration will yield an automatic
  confirmation number
• Updates must be filed within 30 days
• No fee but in English

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Data Elements of Registration

• Name
• Full address
• Phone and fax numbers
• E-mail address
• Name and address of parent company
• Emergency contact information name, title,
  office
• phone, home phone, cell phone and e-mail address
• All trade names used by the facility - brand
  names?
• U.S. agent data - name, address, phone/fax
  numbers
• and e-mail address
• General categories of food produced
• - see product code builder categories

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• Certification at end of submission
• The information is true and accurate, and
• The individual submitting is authorized

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• Optional data categories
• Preferred mailing address
• Type of activity
• Additional food categories, e.g. dietary
  supplements, etc.
• Type of facility, e.g. storage, manufacturing,
  etc.
• Most/all - so dont need to have a list
• Approximate dates of operation
• All existing registration requirements remain in
  place
• Does FDA have the authority to exempt facilities
  from registration if they are already registered
  with another federal agency?

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• Failure to register is a prohibited act which can
  lead to criminal and/or civil enforcement action.
  
• If a felony conviction follows, the party may be
  debarred, i.e., prohibited from importing.

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• If the foreign facility fails to register, any
  imported food will be refused admission, i.e.,
  held at the port of arrival it may also be moved
  to secure storage.
• When should a registration be considered null
  and void?
• When should a registration be revoked?

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• Post-entry registration is allowed but the food
  stays in-bond until the process is completed.
• If no registration is filed, the Customs G.O.
  provisions apply prior to destruction, the food
  may be re-exported.
• With mixed shipments (food and non-food), the
  food portion takes priority so the rest of the
  container cannot move until the food portion is
  dealt with.
• Release due to registration does not guaranty the
  food may proceed.

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• FDAs issuance of a registration number simply
  confirms the facility is properly registered with
  FDA any language on a label suggesting FDA
  approval of the facility is considered misbranding

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• Stakeholders
• Presidents Council on Food
• Secretary of Transportation
• Secretary of the Treasury - Homeland Security?
• Other relevant federal agencies
• The food industry
• Consumer and producer groups
• Scientific organizations,
• and the States

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• Shall consult to develop a crisis communication
  and education strategy with respect to
  bioterroist threats to the food supply.
• The goal is to increase the number of inspections
  of imported food to detect intentional
  adulteration of food.

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• Debarment results if
• Convicted of a felony for conduct related to the
  importation of food into the U.S.
• The person is engaged in a pattern of importing
  or offering for import adulterated food that
  presents a threat of serious adverse health
  consequences or death to humans or animals

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• Records
• New regulations expected as FDA now has the power
  to ask for records from any party which
  manufactures, processes, packs, distributes,
  receives, holds or imports food.

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• Are brokers included under these provisions?
• Records to be maintained are those related to
  manufacturing, processing, packing, transporting,
  distributing, receiving, holding or importing
  food
• Are the activities of a broker part of
  distribution? transportation? holding? receiving?

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THE BIG QUESTIONS

• What form will the FDA request for records take?
• Written request likely but accompanied by
  demand for instant production.
• What records must be turned over
• Just those related to the individual shipment in
  question?
• All shipments for that customer?
• What to do if an FDA investigator shows up
  demanding records?

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• Comment deadline for prior notice and
  registration proposed regulations
• April 4, 2003