82 FR 27625 - Eligibility of the People's Republic of China (PRC) To Export to the United States Poultry Products From Birds Slaughtered in the PRC

DEPARTMENT OF AGRICULTURE
Food Safety and Inspection Service

Federal Register Volume 82, Issue 115 (June 16, 2017)

Page Range		27625-27629
FR Document		2017-12554

The Food Safety and Inspection Service (FSIS) is proposing to amend the poultry products inspection regulations to list the PRC as eligible to export to the United States poultry products from birds slaughtered in the PRC. The PRC is currently eligible to export processed poultry products to the United States if the products are derived from poultry slaughtered in the United States or in other countries eligible to slaughter and export poultry to the United States. FSIS is proposing this action because the Agency has reviewed the PRC's laws, regulations, and poultry slaughter inspection system as implemented and has determined that the PRC's poultry slaughter inspection system is equivalent to the system that the United States has established under the Poultry Products Inspection Act (PPIA) and its implementing regulations. Should this rule become final, slaughtered poultry, or parts or other products thereof, processed in certified PRC establishments, would be eligible for export to the United States. Although the PRC may be listed in FSIS's regulations as eligible to export poultry products to the United States, the products must also comply with all other applicable requirements of the United States, including those of USDA's Animal and Plant Health Inspection Service (APHIS), before any products can enter the United States. All such products would be subject to re- inspection at United States ports-of-entry by FSIS inspectors.

Federal Register, Volume 82 Issue 115 (Friday, June 16, 2017)

[Federal Register Volume 82, Number 115 (Friday, June 16, 2017)]
[Proposed Rules]
[Pages 27625-27629]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2017-12554]

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Proposed Rules
Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.

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Federal Register / Vol. 82, No. 115 / Friday, June 16, 2017 /
Proposed Rules

[[Page 27625]]

DEPARTMENT OF AGRICULTURE

Food Safety and Inspection Service

9 CFR Part 381

[Docket No. FSIS-2016-0002]
RIN 0583-AD64

Eligibility of the People's Republic of China (PRC) To Export to
the United States Poultry Products From Birds Slaughtered in the PRC

AGENCY: Food Safety and Inspection Service, USDA.

ACTION: Proposed rule.

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SUMMARY: The Food Safety and Inspection Service (FSIS) is proposing to
amend the poultry products inspection regulations to list the PRC as
eligible to export to the United States poultry products from birds
slaughtered in the PRC. The PRC is currently eligible to export
processed poultry products to the United States if the products are
derived from poultry slaughtered in the United States or in other
countries eligible to slaughter and export poultry to the United
States. FSIS is proposing this action because the Agency has reviewed
the PRC's laws, regulations, and poultry slaughter inspection system as
implemented and has determined that the PRC's poultry slaughter
inspection system is equivalent to the system that the United States
has established under the Poultry Products Inspection Act (PPIA) and
its implementing regulations.
Should this rule become final, slaughtered poultry, or parts or
other products thereof, processed in certified PRC establishments,
would be eligible for export to the United States. Although the PRC may
be listed in FSIS's regulations as eligible to export poultry products
to the United States, the products must also comply with all other
applicable requirements of the United States, including those of USDA's
Animal and Plant Health Inspection Service (APHIS), before any products
can enter the United States. All such products would be subject to re-
inspection at United States ports-of-entry by FSIS inspectors.

DATES: Comments must be received on or before August 15, 2017.

ADDRESSES: FSIS invites interested persons to submit comments on this
proposed rule. Comments may be submitted by one of the following
methods:
Federal eRulemaking Portal: This Web site provides the
ability to type short comments directly into the comment field on this
Web page or attach a file for lengthier comments. Go to http://www.regulations.gov. Follow the online instructions at that site for
submitting comments.
Mail, including CD-ROMs, etc.: Send to Docket Clerk, U.S.
Department of Agriculture, Food Safety and Inspection Service, Patriots
Plaza 3, 1400 Independence Avenue SW., Mailstop 3782, Room 8-163A,
Washington, DC 20250-3700.
Hand- or courier-delivered submittals: Deliver to Patriots
Plaza 3, 355 E Street SW., Room 8-163B, Washington, DC 20250-3700.
Instructions: All items submitted by mail or electronic mail must
include the Agency name and docket number FSIS-2016-0002. Comments
received in response to this docket will be made available for public
inspection and posted without change, including any personal
information, to http://www.regulations.gov.
Docket: For access to background documents or comments received, go
to the FSIS Docket Room at Patriots Plaza 3, 355 E Street SW., Room 8-
164, Washington, DC 20250-3700 between 8:00 a.m. and 4:30 p.m., Monday
through Friday.

FOR FURTHER INFORMATION CONTACT: Dr. Daniel Engeljohn, Assistant
Administrator, Office of Policy and Program Development; Telephone:
(202) 205-0495.

SUPPLEMENTARY INFORMATION:

Background

The PRC is currently eligible to export processed poultry products
to the United States if they are processed in certified establishments
in the PRC from poultry slaughtered in federally inspected
establishments in the United States or in other certified slaughter
establishments in other countries eligible to export poultry to the
United States. FSIS is proposing to amend the poultry inspection
regulations (9 CFR 381.196(b)) to list the PRC as also eligible to
export to the United States poultry products from birds slaughtered in
certified PRC establishments to the United States.

Statutory Basis for Proposed Action

Section 17 of the PPIA (21 U.S.C. 466) prohibits importation into
the United States of slaughtered poultry, or parts or products thereof,
of any kind unless they are healthful, wholesome, fit for human food,
not adulterated, and contain no dye, chemical, preservative, or
ingredient that renders them unhealthful, unwholesome, adulterated, or
unfit for human food. Under the PPIA and the regulations that implement
it, poultry products imported into the United States must be produced
under standards for safety, wholesomeness, and labeling accuracy that
are equivalent to those of the United States. Section 381.196 of Title
9 of the Code of Federal Regulations (CFR) sets out the procedures by
which foreign countries may become eligible to export poultry and
poultry products to the United States.
Section 381.196(a) requires a foreign country's poultry inspection
system to include standards equivalent to those of the United States
and to provide legal authority for the inspection system and its
implementing regulations that is equivalent to that of the United
States. Specifically, a country's legal authority and regulations must
impose requirements equivalent to those of the United States with
respect to: (1) Ante-mortem and post-mortem inspection by, or under the
direct supervision of, a veterinarian; (2) official controls by the
national government over establishment construction, facilities, and
equipment; (3) direct and continuous official supervision of
slaughtering of poultry and processing of poultry products by
inspectors to ensure that product is not adulterated or misbranded; (4)
complete separation of establishments certified to export from those
not certified; (5) maintenance of a single standard of inspection and
sanitation throughout certified establishments; (6) requirements for
sanitation and for sanitary handling of product at establishments
certified to export; (7) official controls over condemned product; (8)
a Hazard Analysis and

[[Page 27626]]

Critical Control Point (HACCP) system; and (9) any other requirements
found in the PPIA and its implementing regulations (9 CFR
381.196(a)(2)(ii)).
The country's inspection system must also impose requirements
equivalent to those of the United States with respect to: (1)
Organizational structure and staffing to ensure uniform enforcement of
the requisite laws and regulations in all certified establishments; (2)
national government control and supervision over the official
activities of employees or licensees; (3) competent, qualified
inspectors; (4) enforcement and certification authority; (5)
administrative and technical support; (6) inspection, sanitation,
quality, species verification, and residue standards; and (7) any other
inspection requirements (9 CFR 381.196(a)(2)(i)).
The foreign country's inspection system must ensure that
establishments preparing poultry or poultry products for export to the
United States comply with requirements equivalent to those of the PPIA
and the regulations promulgated by FSIS under the authority of that
statute. The foreign country certifies the appropriate establishments
as having met the required standards and advises FSIS of those
establishments that are certified or removed from certification. Before
FSIS will grant approval to the country to export poultry or poultry
products to the United States, FSIS must first determine that reliance
can be placed on the certification of establishments by the foreign
country (9 CFR 381.196(a)(1)).
As indicated above, a foreign country's inspection system must be
evaluated by FSIS before eligibility to export poultry products to the
United States can be granted. This evaluation consists of two
processes: A document review and an on-site review. The document review
is an evaluation of the laws, regulations, and other written materials
used by the country to effect its inspection program. FSIS requests
that countries provide information about their inspection systems
through its self-reporting tool (SRT). The SRT is a standardized
questionnaire that FSIS provides to foreign governments to gather
information that characterizes foreign inspection systems. Through the
SRT, FSIS collects information on practices and procedures in six
areas, known as equivalence components: (1) Government Oversight (e.g.,
Organization and Administration), (2) Government Statutory Authority
and Food Safety and Other Consumer Protection Regulations (e.g.,
Inspection System Operation, Product Standards and Labeling, and Humane
Handling), (3) Government Sanitation, (4) Government HACCP Systems, (5)
Government Chemical Residue Testing Programs, and (6) Government
Microbiological Testing Programs.\1\ FSIS evaluates the information
submitted to verify that the critical points in the six equivalence
components are addressed satisfactorily with respect to standards,
activities, resources, and enforcement. If the document review is
satisfactory, an onsite review is scheduled using a multidisciplinary
team to evaluate all aspects of the country's inspection program. This
comprehensive process is described more fully on the FSIS Web site at
http://www.fsis.usda.gov/wps/portal/fsis/topics/international-affairs/importing-products/equivalence/equivalence-process-overview.
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\1\ FSIS has made slight changes to the titles of the six
equivalence components in the SRT. FSIS added ``Government'' to the
titles of all of the components to clarify that FSIS assesses food
regulatory systems. FSIS also added examples of types of government
oversight and types of statutory authority and food safety
regulations that FSIS evaluates when determining equivalence so that
those components are easier to understand.
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The PPIA and implementing regulations require that foreign
countries be listed in the CFR as eligible to export poultry products
to the United States. FSIS must engage in rulemaking to list a country
as eligible. Countries found eligible to export poultry or poultry
products to the United States are listed in the poultry inspection
regulations at 9 CFR 381.196(b). Once listed, the government of an
eligible country must certify to FSIS that establishments that wish to
export poultry products to the United States are operating under
requirements equivalent to those of the United States (9 CFR
381.196(a)(3)). Countries must renew certifications of establishments
annually (9 CFR 381.196(a)(3)). To verify that products imported into
the United States are not adulterated or misbranded, FSIS reinspects
and randomly samples those products at ports-of-entry before they enter
U.S. commerce.

Evaluation of the PRC's Poultry Inspection System

In May 2004, the government of the PRC requested approval to export
poultry products to the United States. FSIS conducted a document review
of the PRC's poultry (slaughter and processing) inspection system to
determine whether that system was equivalent to the United States
poultry inspection system. FSIS concluded, on the basis of that review,
that the PRC's laws, regulations, control programs, and procedures were
equivalent to those of the United States.
Accordingly, FSIS proceeded with an on-site audit of the PRC's
poultry inspection system from December 1 to December 17, 2004, to
verify that the PRC's General Administration of Quality Supervision,
Inspection, and Quarantine (AQSIQ), which is the PRC's central
competent authority (CCA) in charge of food inspection, effectively
implemented a poultry inspection system equivalent to that of the
United States. During the 2004 on-site audit, FSIS identified problems
with the PRC's sanitation controls, slaughter/processing controls,
residue controls, and enforcement controls. For example, FSIS found
that the sanitation programs at the establishments visited by the audit
team lacked measures to prevent recurring deficiencies that could
result in direct product contamination or adulteration, but AQSIQ
inspectors did not identify the problems. FSIS also found that the CCA
did not have adequate control and supervision over establishments, and
official veterinarians did not adequately understand FSIS standards.
From July 27 to August 12, 2005, FSIS conducted a follow-up initial
equivalence audit to determine whether the outstanding issues
identified during the previous audit had been resolved. FSIS concluded
that the PRC had satisfactorily addressed all of the 2004 audit
findings for poultry processing. However, the 2005 audit had identified
a new systemic deficiency within the risk area of enforcement controls
for poultry slaughter. Specifically, FSIS found that ante-mortem and
post-mortem inspection procedures and dispositions were performed by
establishment-paid veterinarians. On the basis of the 2005 audit, FSIS
determined that the PRC's system for processed poultry was equivalent
to that of the United States system, but denied the PRC's eligibility
to export slaughtered poultry.
In April 2006, FSIS published a final rule in the Federal Register
that added the PRC to the list of countries eligible to export poultry
products to the United States with the stipulation that the PRC could
only export processed poultry products derived from birds slaughtered
under Federal inspection in the United States or from another country
eligible to export slaughtered poultry products (see 71 FR 20867; April
24, 2006). However, shortly after the publication of the final rule,
Congress prohibited FSIS from using funds to establish or implement a
rule allowing poultry products to be exported to the United States from
the PRC (see Sec. 733 of Pub. L. 110-161). As a result, the PRC

[[Page 27627]]

was unable to export poultry products to the United States.
In October 2009, Congress lifted the ban on poultry product exports
from the PRC on the condition that FSIS conduct on-site reviews of
slaughter and processing facilities, laboratories, and other control
operations and conduct annual audits and reviews after the PRC is
deemed equivalent (see Sec. 743 of Pub. L. 111-80).
In June 2010, a team of FSIS experts traveled to the PRC to collect
information related to legislation applicable to their poultry
inspection system. FSIS conducted a comprehensive analysis of the PRC's
Food Safety Law (FSL) promulgated in 2009 and other information
submitted by the PRC to verify that the following equivalence
components were addressed satisfactorily with respect to standards,
activities, resources, and enforcement: (1) Government Oversight (e.g.,
Organization and Administration); (2) Government Statutory Authority
and Food Safety and Other Consumer Protection Regulations (e.g.,
Inspection System Operation, Product Standards and Labeling, and Humane
Handling); (3) Government Sanitation; (4) Government HACCP Systems; (5)
Government Chemical Residue Testing Programs; and (6) Government
Microbiological Testing Programs.
From December 1 to 21, 2010, FSIS conducted separate but concurrent
on-site audits of the PRC's processed poultry inspection system and the
PRC's poultry slaughter inspection system to verify whether the CCA was
able to effectively implement a poultry inspection system equivalent to
that of the United States. The auditors concluded that the CCA was able
to meet the principal requirements for the equivalence components of
Sanitation and Chemical Residue Programs. However, FSIS identified
systemic inadequacies in both the PRC's processed poultry inspection
system and the PRC's poultry slaughter inspection system within the
equivalence components for: Government Oversight (e.g., Organization
and Administration), Government Statutory Authority and Food Safety and
Other Consumer Protection Regulations (e.g., Inspection System
Operation, Product Standards and Labeling, and Humane Handling),
Government HACCP Systems, and Government Microbiological Testing
Programs. For example, FSIS found that the CCA lacked a standardized
method to assign inspection personnel to slaughter facilities based on
objective measurements such as production line rates, inspection
workloads, or line configuration. The CCA also utilized establishment-
paid inspectors to conduct official inspection duties. The CCA
responded by developing a comprehensive corrective action plan
addressing the findings.
From March 4 to 19, 2013, FSIS conducted follow-up on-site audits
to verify whether the CCA maintained effective oversight of the PRC's
processed poultry inspection system and the PRC's poultry slaughter
inspection system and to verify whether the PRC implemented the
corrective actions proffered in response to the previous audit's
findings. On the basis of the 2013 audit of the processed poultry
inspection system, FSIS concluded that the PRC's processed poultry
inspection system met all the equivalence components for FSIS
equivalence criteria. Therefore, on August 30, 2013, FSIS announced in
the Constituent Update (available at: http://www.fsis.usda.gov/wps/wcm/connect/9ad2eb47-a47f-4d16-9b81-0e57368f0c07/ConstUpdate083013.pdf?MOD=AJPERES&CONVERT_TO=url&CACHEID=9ad2eb47-a47f-4d16-9b81-0e57368f0c07) that the PRC could export processed poultry
products to the United States. However, the CCA did not adequately
address all previously identified concerns about its poultry slaughter
inspection system. The CCA was able to meet the principal requirements
of the equivalence components for Government Sanitation, Government
HACCP Systems, Government Chemical Residue Testing Programs, and
Government Microbiological Testing Programs, but FSIS found that the
Government Oversight (e.g., Organization and Administration) and
Government Statutory Authority and Food Safety and Other Consumer
Protection Regulations (e.g., Inspection System Operation, Product
Standards and Labeling, and Humane Handling) components were not
equivalent. Specifically, the CCA still lacked a standardized method to
assign inspection personnel to slaughter facilities on the basis of
objective measurements. The CCA responded to these concerns, stating
that it would implement changes to its poultry slaughter inspection
system.
From May 8 to 28, 2015, FSIS conducted separate but concurrent on-
site audits to verify whether the PRC's processed poultry inspection
system remains equivalent to the United States' system, and to verify
whether the CCA adopted the necessary corrective measures to its
poultry slaughter inspection system. FSIS concluded, from the 2015
follow-up audits, that the PRC's processed poultry inspection system
remains equivalent to the United States' system. FSIS also concluded
that the PRC had satisfactorily addressed all issues of concern that
FSIS raised in its 2013 audit of the PRC poultry slaughter inspection
system and had met the FSIS equivalence criteria for all six
components.
On August 21, 2014, FSIS published a final rule to modernize
poultry slaughter inspection (79 FR 49566). The rule implemented new
U.S. regulatory requirements including (1) the New Poultry Inspection
System (NPIS), an optional post-mortem inspection system, and (2)
regulatory changes that apply to all poultry slaughter establishments.
On August 11, 2016, the PRC sent a letter to FSIS outlining the changes
that were made to the PRC's poultry inspection system to achieve
equivalency with the revised U.S. regulations. The PRC stated in the
letter that it had updated its inspection manuals to require that
establishments develop, implement, and maintain written procedures in
their HACCP plans, Sanitation SOPs, or other prerequisite programs to
ensure that carcasses with visible fecal contamination do not enter the
chiller. According to the letter, the manuals also require
establishments to develop, implement, and maintain written procedures
in their HACCP plans, Sanitation SOPs, or other prerequisite programs
to prevent contamination of carcasses and parts by enteric pathogens
and visible fecal material. The PRC stated in the letter that these
written procedures must include sampling and analysis for microbial
organisms to monitor process control for enteric pathogens. The PRC
stated in the letter that it had adopted the U.S. requirements for
NPIS, and that establishments must get approval from their local
official regulatory agency before they may use the system. On September
1, 2016, the PRC sent copies of their updated inspection manuals to
FSIS. FSIS has reviewed the submitted letter and updated inspection
manuals and has determined that the PRC poultry slaughter inspection
system is equivalent with the new U.S. regulatory requirements in the
August 21, 2014 final rule.
In summary, FSIS has completed the document review, on-site audits,
and has verified that the PRC made necessary to corrective actions to
its poultry slaughter inspection system in response to the FSIS audits.
Therefore, FSIS has determined that, as implemented, the PRC's poultry
slaughter inspection system is equivalent to the United States poultry

[[Page 27628]]

inspection system. The full audit reports on the PRC's poultry
inspection system (slaughter and processing) can be found on the FSIS
Web site at: http://www.fsis.usda.gov/wps/portal/fsis/topics/international-affairs/importing-products/eligible-countries-products-foreign-establishments/foreign-audit-reports.
Should this rule become final, the government of the PRC must
certify to FSIS those establishments that wish to export slaughtered
poultry products to the United States are operating in accordance with
requirements equivalent to those of the United States. FSIS will verify
whether the establishments certified by the PRC's government meet the
United States requirements through annual scheduled audits of the PRC's
poultry inspection system.
Although a foreign country may be listed in FSIS regulations as
eligible to export poultry to the United States, the exporting
country's products must also comply with all other applicable
requirements of the United States. These requirements include
restrictions under 9 CFR part 94 of APHIS's regulations, which also
regulate the exportation of poultry products from foreign countries to
the United States. For example, APHIS has classified the PRC as a
region affected with Highly Pathogenic Avian Influenza subtype H5N1 and
Exotic Newcastle Disease. Therefore, even if FSIS were to list the PRC
as a country eligible to export slaughtered poultry, or parts or
products thereof, at this time, the PRC would only be allowed to export
cooked poultry products to the United States (see 9 CFR 94.6). Since
the PRC's disease status may change during the equivalence process,
FSIS will follow-up with APHIS and take into consideration how changes
in the animal disease status may impact the country's eligibility to
export certain types of poultry products to the United States.
If this proposed rule is adopted, all slaughtered poultry, or parts
and products thereof, exported to the United States from the PRC will
be subject to re-inspection at the U.S. ports-of-entry for, but not
limited to, transportation damage, product and container defects,
labeling, proper certification, general condition, and accurate count.
In addition, FSIS will conduct other types of re-inspection activities,
such as incubation of canned products to ensure product safety and
taking product samples for laboratory analysis for the detection of
drug and chemical residues, pathogens, species, and product
composition. Products that pass re-inspection will be stamped with the
official United States mark of inspection and allowed to enter United
States commerce. If they do not meet United States requirements, they
will be refused entry and within 45 days must be exported to the
country of origin, destroyed, or converted to animal food (subject to
approval of the U.S. Food and Drug Administration (FDA)), depending on
the violation. The import re-inspection activities can be found on the
FSIS Web site at http://www.fsis.usda.gov/regulations_&_policies/fsis_import_reinspection/index.asp.

Executive Orders 12866 and 13563, and the Regulatory Flexibility Act

Executive Orders 12866 and 13563 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, of reducing costs, of harmonizing rules, and of promoting
flexibility. This proposed rule has been designated as a ``non-
significant'' regulatory action under section 3(f) of Executive Order
(E.O.) 12866. Accordingly, the rule has not been reviewed by the Office
of Management and Budget (OMB) under E.O. 12866 and is not subject to
the provisions of E.O 13771.

Expected Costs of the Proposed Rule

The costs of this rule would accrue primarily to domestic poultry
producers in the form of greater competition from the PRC. In the short
run, the cost is likely to be small as the expected volume of trade
stimulated by this proposed rule is likely to be small (see Expected
Benefits section below.)
The domestic producers would probably start to feel the pressure of
competition should the PRC become eligible to export raw and other non-
fully-cooked poultry products, and more establishments become certified
to export to the United States. Some domestic producers may lose market
share, and would have to make the necessary investment to be more
efficient and stay competitive. As discussed before, the Agency cannot
predict when this could happen. However, because the initial impact is
likely to be small, as the expected PRC export volume is low, the
Agency expects that the United States' industry would have time to
prepare for the potentially larger impact and adjust their business
strategies.

Expected Benefits of the Proposed Rule

FSIS has not estimated the potential impact in the long run.
However, the PRC is the second largest poultry producing country in the
world, trailing closely behind the United States.\2\ If the PRC were to
export other poultry products (for example, if APHIS allows the PRC to
export raw chicken products) \3\ to the United States and more PRC
establishments become certified to be eligible, consumers will likely
benefit from more choices and more competitive prices in the
marketplace, and producers will likely become more efficient to be
competitive.\4\ The Agency did not quantify the value of these benefits
because of the lack of predictability associated with the many factors
that heavily influence trade patterns and volume. These factors include
results of Sanitary and Phytosanitary Standards issues (e.g. the avian
influenza), exchange rates,\5\ and domestic political and economic
conditions.
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\2\ See Food Outlook, Food and Agricultural Organization (FAO)
of the United Nations, October 2015, p. 49, at http://www.fao.org/3/a-i5003e.pdf, accessed 1/11/2016.
\3\ As mentioned above, APHIS has classified PRC as region
affected by certain animal diseases, so the PRC would only be
allowed to export cooked poultry products to the United States.
\4\ It is well-established that international trade benefits
trade partners because it allows countries to specialize in
producing products at which they have a comparative advantage.
\5\ The exchange rate affects the relative prices of exports and
imports. The PRC's currency--RMB--has been appreciating against
other currencies and is expected to fluctuate in the near future.
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Adoption of this rule will increase trade between the United States
and the PRC in poultry products. In the short run, the volume of trade
stimulated by this proposed rule is likely to be small because the PRC
only intends to certify five slaughter establishments to provide
poultry to certified processing establishments to export fully-cooked
poultry products to the United States. Data from the PRC showed that
these five slaughter establishments will supply poultry to five
processing establishments that the PRC will certify as eligible to ship
product to the U.S.--three of them intend to export cooked chicken
quarter-legs and chicken breasts, one to export cooked duck legs and
duck breasts, and one to export roasted boneless duck to the United
States. According to the data, the projected volume of export to the
United States will be about 324 million pounds per year for the next
five years.\6\

[[Page 27629]]

Given that the United States domestic annual production volume of RTE
fully-cooked poultry is about 12,325 million pounds,\7\ the projected
cooked poultry products from the PRC would only be about 2.6 percent of
total United States production in the next five years.\8\ The immediate
impact on the United States consumers and domestic processors is likely
to be minor, as the low volume of trade is likely to have little effect
on supply, demand, and prices.
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\6\ Data is from the General Administration of Quality
Supervision, Inspection and Quarantine of the People's Republic of
China, November 2015. The projected annual production of the
mentioned chicken and duck products at these five processing
establishments will be about 838 million pounds per year, which
could be sold in the PRC or to other foreign countries.
\7\ Calculated from PHIS data in November 2015. This number
cannot be divided by species. If we adjusted it by the proportions
of chicken and ducks in total domestic slaughtered poultry, which is
88.3 percent, the volume would be about 10,833 million pounds per
year.
\8\ If we use 10,833 million pounds (see previous footnote) as
the denominator, the projected PRC export would be about 3 percent
of United States domestic production of fully-cooked chicken and
duck.
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Expected Effects on Small Entities

The FSIS Administrator has made a preliminary determination that
this proposed rule will not have a significant impact on a substantial
number of small entities, as defined by the Regulatory Flexibility Act
(5 U.S.C. 601). The expected trade volume will be small, with little or
no effect on all U.S. establishments, regardless of size.

Executive Order 12988

This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. If this proposed rule is adopted: (1) All State
and local laws and regulations that are inconsistent with this rule
will be preempted; (2) No retroactive effect will be given to this
rule; and (3) Administrative proceedings will not be required before
parties may file suit in court challenging this rule.

Paperwork Reduction Act

No new paperwork requirements are associated with this proposed
rule. Foreign countries wanting to export poultry and poultry products
to the United States are required to provide information to FSIS
certifying that their inspection systems provide standards equivalent
to those of the United States, and that the legal authority for the
system and their implementing regulations are equivalent to those of
the United States. FSIS provided the PRC with questionnaires asking for
detailed information about the country's inspection practices and
procedures to assist that country in organizing its materials. This
information collection was approved under OMB control number 0583-0094.
The proposed rule contains no other paperwork requirements.

E-Government Act

FSIS and USDA are committed to achieving the purposes of the E-
Government Act (44 U.S.C. 3601, et seq.) by, among other things,
promoting the use of the Internet and other information technologies
and providing increased opportunities for citizen access to Government
information and services, and for other purposes.

Additional Public Notification

FSIS will officially notify the World Trade Organization's
Committee on Sanitary and Phytosanitary Measures (WTO/SPS Committee) in
Geneva, Switzerland, of this proposal and will announce it on-line
through the FSIS Web page located at: http://www.fsis.usda.gov/regulations_&_policies/Proposed_Rules/index.asp. FSIS also will make
copies of this Federal Register publication available through the FSIS
Constituent Update, which is used to provide information regarding FSIS
policies, procedures, regulations, Federal Register notices, FSIS
public meetings, and other types of information that could affect or
would be of interest to our constituents and stakeholders. The Update
is available on the FSIS Web page. Through the Web page, FSIS is able
to provide information to a much broader, more diverse audience. In
addition, FSIS offers an email subscription service which provides
automatic and customized access to selected food safety news and
information. This service is available at: http://www.fsis.usda.gov/subscribe. Options range from recalls to export information,
regulations, directives, and notices. Customers can add or delete
subscriptions themselves, and have the option to password protect their
accounts.

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List of Subjects in 9 CFR Part 381

Imported products.

For the reasons set out in the preamble, FSIS is proposing to amend
9 CFR part 381 as follows:

PART 381--POULTRY PRODUCTS INSPECTION REGULATIONS

0
1. The authority citation for Part 381 continues to read as follows:

Authority: 7 U.S.C. 138f, 450; 21 U.S.C. 451-470; 7 CFR 2.7,
2.18, 2.53.

Sec. 381.196 [Amended]

0
2. Amend Sec. 381.196(b) by removing footnote 2 after ``People's
Republic of China.''

Done at Washington, DC, on June 12, 2017.
Alfred V. Almanza,
Administrator.
[FR Doc. 2017-12554 Filed 6-15-17; 8:45 am]
BILLING CODE 3410-DM-P

27625

Proposed Rules Federal Register
Vol. 82, No. 115

Friday, June 16, 2017

This section of the FEDERAL REGISTER All such products would be subject to States. FSIS is proposing to amend the
contains notices to the public of the proposed re-inspection at United States ports-of- poultry inspection regulations (9 CFR
issuance of rules and regulations. The entry by FSIS inspectors. 381.196(b)) to list the PRC as also
purpose of these notices is to give interested eligible to export to the United States
DATES: Comments must be received on
persons an opportunity to participate in the poultry products from birds slaughtered
rule making prior to the adoption of the final or before August 15, 2017.
rules. ADDRESSES: FSIS invites interested in certified PRC establishments to the
persons to submit comments on this United States.
proposed rule. Comments may be Statutory Basis for Proposed Action
DEPARTMENT OF AGRICULTURE submitted by one of the following
methods: Section 17 of the PPIA (21 U.S.C. 466)
Food Safety and Inspection Service • Federal eRulemaking Portal: This prohibits importation into the United
Web site provides the ability to type States of slaughtered poultry, or parts or
9 CFR Part 381 short comments directly into the products thereof, of any kind unless
comment field on this Web page or they are healthful, wholesome, fit for
[Docket No. FSIS–2016–0002]
attach a file for lengthier comments. Go human food, not adulterated, and
RIN 0583–AD64 to http://www.regulations.gov. Follow contain no dye, chemical, preservative,
the online instructions at that site for or ingredient that renders them
Eligibility of the People’s Republic of unhealthful, unwholesome, adulterated,
submitting comments.
China (PRC) To Export to the United • Mail, including CD–ROMs, etc.: or unfit for human food. Under the PPIA
States Poultry Products From Birds Send to Docket Clerk, U.S. Department and the regulations that implement it,
Slaughtered in the PRC of Agriculture, Food Safety and poultry products imported into the
AGENCY: Food Safety and Inspection Inspection Service, Patriots Plaza 3, United States must be produced under
Service, USDA. 1400 Independence Avenue SW., standards for safety, wholesomeness,
ACTION: Proposed rule. Mailstop 3782, Room 8–163A, and labeling accuracy that are
Washington, DC 20250–3700. equivalent to those of the United States.
SUMMARY: The Food Safety and • Hand- or courier-delivered Section 381.196 of Title 9 of the Code
Inspection Service (FSIS) is proposing submittals: Deliver to Patriots Plaza 3, of Federal Regulations (CFR) sets out the
to amend the poultry products 355 E Street SW., Room 8–163B, procedures by which foreign countries
inspection regulations to list the PRC as Washington, DC 20250–3700. may become eligible to export poultry
eligible to export to the United States Instructions: All items submitted by and poultry products to the United
poultry products from birds slaughtered mail or electronic mail must include the States.
in the PRC. The PRC is currently eligible Agency name and docket number FSIS– Section 381.196(a) requires a foreign
to export processed poultry products to 2016–0002. Comments received in country’s poultry inspection system to
the United States if the products are response to this docket will be made include standards equivalent to those of
derived from poultry slaughtered in the available for public inspection and the United States and to provide legal
United States or in other countries posted without change, including any authority for the inspection system and
eligible to slaughter and export poultry personal information, to http:// its implementing regulations that is
to the United States. FSIS is proposing www.regulations.gov. equivalent to that of the United States.
this action because the Agency has Docket: For access to background Specifically, a country’s legal authority
reviewed the PRC’s laws, regulations, documents or comments received, go to and regulations must impose
and poultry slaughter inspection system the FSIS Docket Room at Patriots Plaza requirements equivalent to those of the
as implemented and has determined 3, 355 E Street SW., Room 8–164, United States with respect to: (1) Ante-
that the PRC’s poultry slaughter Washington, DC 20250–3700 between mortem and post-mortem inspection by,
inspection system is equivalent to the 8:00 a.m. and 4:30 p.m., Monday or under the direct supervision of, a
system that the United States has through Friday. veterinarian; (2) official controls by the
established under the Poultry Products FOR FURTHER INFORMATION CONTACT: Dr. national government over establishment
Inspection Act (PPIA) and its Daniel Engeljohn, Assistant construction, facilities, and equipment;
implementing regulations. Administrator, Office of Policy and (3) direct and continuous official
Should this rule become final, Program Development; Telephone: (202) supervision of slaughtering of poultry
slaughtered poultry, or parts or other 205–0495. and processing of poultry products by
products thereof, processed in certified SUPPLEMENTARY INFORMATION: inspectors to ensure that product is not
PRC establishments, would be eligible adulterated or misbranded; (4) complete
for export to the United States. Background separation of establishments certified to
Although the PRC may be listed in The PRC is currently eligible to export export from those not certified; (5)
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FSIS’s regulations as eligible to export processed poultry products to the maintenance of a single standard of
poultry products to the United States, United States if they are processed in inspection and sanitation throughout
the products must also comply with all certified establishments in the PRC from certified establishments; (6)
other applicable requirements of the poultry slaughtered in federally requirements for sanitation and for
United States, including those of inspected establishments in the United sanitary handling of product at
USDA’s Animal and Plant Health States or in other certified slaughter establishments certified to export; (7)
Inspection Service (APHIS), before any establishments in other countries official controls over condemned
products can enter the United States. eligible to export poultry to the United product; (8) a Hazard Analysis and

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27626 Federal Register / Vol. 82, No. 115 / Friday, June 16, 2017 / Proposed Rules

Critical Control Point (HACCP) system; Government HACCP Systems, (5) Accordingly, FSIS proceeded with an
and (9) any other requirements found in Government Chemical Residue Testing on-site audit of the PRC’s poultry
the PPIA and its implementing Programs, and (6) Government inspection system from December 1 to
regulations (9 CFR 381.196(a)(2)(ii)). Microbiological Testing Programs.1 FSIS December 17, 2004, to verify that the
The country’s inspection system must evaluates the information submitted to PRC’s General Administration of
also impose requirements equivalent to verify that the critical points in the six Quality Supervision, Inspection, and
those of the United States with respect equivalence components are addressed Quarantine (AQSIQ), which is the PRC’s
to: (1) Organizational structure and satisfactorily with respect to standards, central competent authority (CCA) in
staffing to ensure uniform enforcement activities, resources, and enforcement. If charge of food inspection, effectively
of the requisite laws and regulations in the document review is satisfactory, an implemented a poultry inspection
all certified establishments; (2) national onsite review is scheduled using a system equivalent to that of the United
government control and supervision multidisciplinary team to evaluate all States. During the 2004 on-site audit,
over the official activities of employees aspects of the country’s inspection FSIS identified problems with the PRC’s
or licensees; (3) competent, qualified program. This comprehensive process is sanitation controls, slaughter/processing
inspectors; (4) enforcement and described more fully on the FSIS Web controls, residue controls, and
certification authority; (5) site at http://www.fsis.usda.gov/wps/ enforcement controls. For example,
administrative and technical support; portal/fsis/topics/international-affairs/ FSIS found that the sanitation programs
(6) inspection, sanitation, quality, importing-products/equivalence/ at the establishments visited by the
species verification, and residue equivalence-process-overview. audit team lacked measures to prevent
standards; and (7) any other inspection The PPIA and implementing recurring deficiencies that could result
requirements (9 CFR 381.196(a)(2)(i)). regulations require that foreign in direct product contamination or
The foreign country’s inspection countries be listed in the CFR as eligible adulteration, but AQSIQ inspectors did
system must ensure that establishments to export poultry products to the United not identify the problems. FSIS also
preparing poultry or poultry products States. FSIS must engage in rulemaking found that the CCA did not have
for export to the United States comply to list a country as eligible. Countries adequate control and supervision over
with requirements equivalent to those of found eligible to export poultry or establishments, and official
the PPIA and the regulations poultry products to the United States veterinarians did not adequately
promulgated by FSIS under the are listed in the poultry inspection understand FSIS standards.
authority of that statute. The foreign regulations at 9 CFR 381.196(b). Once From July 27 to August 12, 2005, FSIS
country certifies the appropriate listed, the government of an eligible conducted a follow-up initial
establishments as having met the country must certify to FSIS that equivalence audit to determine whether
required standards and advises FSIS of establishments that wish to export
those establishments that are certified or the outstanding issues identified during
poultry products to the United States the previous audit had been resolved.
removed from certification. Before FSIS
are operating under requirements FSIS concluded that the PRC had
will grant approval to the country to
equivalent to those of the United States satisfactorily addressed all of the 2004
export poultry or poultry products to
(9 CFR 381.196(a)(3)). Countries must audit findings for poultry processing.
the United States, FSIS must first
renew certifications of establishments However, the 2005 audit had identified
determine that reliance can be placed on
annually (9 CFR 381.196(a)(3)). To a new systemic deficiency within the
the certification of establishments by the
verify that products imported into the risk area of enforcement controls for
foreign country (9 CFR 381.196(a)(1)).
As indicated above, a foreign United States are not adulterated or poultry slaughter. Specifically, FSIS
country’s inspection system must be misbranded, FSIS reinspects and found that ante-mortem and post-
evaluated by FSIS before eligibility to randomly samples those products at mortem inspection procedures and
export poultry products to the United ports-of-entry before they enter U.S. dispositions were performed by
States can be granted. This evaluation commerce. establishment-paid veterinarians. On
consists of two processes: A document Evaluation of the PRC’s Poultry the basis of the 2005 audit, FSIS
review and an on-site review. The Inspection System determined that the PRC’s system for
document review is an evaluation of the processed poultry was equivalent to that
laws, regulations, and other written In May 2004, the government of the of the United States system, but denied
materials used by the country to effect PRC requested approval to export the PRC’s eligibility to export
its inspection program. FSIS requests poultry products to the United States. slaughtered poultry.
that countries provide information FSIS conducted a document review of In April 2006, FSIS published a final
about their inspection systems through the PRC’s poultry (slaughter and rule in the Federal Register that added
its self-reporting tool (SRT). The SRT is processing) inspection system to the PRC to the list of countries eligible
a standardized questionnaire that FSIS determine whether that system was to export poultry products to the United
provides to foreign governments to equivalent to the United States poultry States with the stipulation that the PRC
gather information that characterizes inspection system. FSIS concluded, on could only export processed poultry
foreign inspection systems. Through the the basis of that review, that the PRC’s products derived from birds slaughtered
SRT, FSIS collects information on laws, regulations, control programs, and under Federal inspection in the United
practices and procedures in six areas, procedures were equivalent to those of States or from another country eligible
known as equivalence components: (1) the United States. to export slaughtered poultry products
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Government Oversight (e.g., 1 FSIS has made slight changes to the titles of the
(see 71 FR 20867; April 24, 2006).
Organization and Administration), (2) six equivalence components in the SRT. FSIS added
However, shortly after the publication of
Government Statutory Authority and ‘‘Government’’ to the titles of all of the components the final rule, Congress prohibited FSIS
Food Safety and Other Consumer to clarify that FSIS assesses food regulatory from using funds to establish or
Protection Regulations (e.g., Inspection systems. FSIS also added examples of types of implement a rule allowing poultry
government oversight and types of statutory
System Operation, Product Standards authority and food safety regulations that FSIS
products to be exported to the United
and Labeling, and Humane Handling), evaluates when determining equivalence so that States from the PRC (see Sec. 733 of
(3) Government Sanitation, (4) those components are easier to understand. Pub. L. 110–161). As a result, the PRC

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Federal Register / Vol. 82, No. 115 / Friday, June 16, 2017 / Proposed Rules 27627

was unable to export poultry products configuration. The CCA also utilized PRC’s processed poultry inspection
to the United States. establishment-paid inspectors to system remains equivalent to the United
In October 2009, Congress lifted the conduct official inspection duties. The States’ system. FSIS also concluded that
ban on poultry product exports from the CCA responded by developing a the PRC had satisfactorily addressed all
PRC on the condition that FSIS conduct comprehensive corrective action plan issues of concern that FSIS raised in its
on-site reviews of slaughter and addressing the findings. 2013 audit of the PRC poultry slaughter
processing facilities, laboratories, and From March 4 to 19, 2013, FSIS inspection system and had met the FSIS
other control operations and conduct conducted follow-up on-site audits to equivalence criteria for all six
annual audits and reviews after the PRC verify whether the CCA maintained components.
is deemed equivalent (see Sec. 743 of effective oversight of the PRC’s On August 21, 2014, FSIS published
Pub. L. 111–80). processed poultry inspection system a final rule to modernize poultry
In June 2010, a team of FSIS experts and the PRC’s poultry slaughter slaughter inspection (79 FR 49566). The
traveled to the PRC to collect inspection system and to verify whether rule implemented new U.S. regulatory
information related to legislation the PRC implemented the corrective requirements including (1) the New
applicable to their poultry inspection actions proffered in response to the Poultry Inspection System (NPIS), an
system. FSIS conducted a previous audit’s findings. On the basis optional post-mortem inspection
comprehensive analysis of the PRC’s of the 2013 audit of the processed system, and (2) regulatory changes that
Food Safety Law (FSL) promulgated in poultry inspection system, FSIS apply to all poultry slaughter
2009 and other information submitted concluded that the PRC’s processed establishments. On August 11, 2016, the
by the PRC to verify that the following poultry inspection system met all the PRC sent a letter to FSIS outlining the
equivalence components were equivalence components for FSIS changes that were made to the PRC’s
addressed satisfactorily with respect to equivalence criteria. Therefore, on poultry inspection system to achieve
standards, activities, resources, and August 30, 2013, FSIS announced in the equivalency with the revised U.S.
enforcement: (1) Government Oversight Constituent Update (available at: http:// regulations. The PRC stated in the letter
(e.g., Organization and Administration); www.fsis.usda.gov/wps/wcm/connect/ that it had updated its inspection
(2) Government Statutory Authority and 9ad2eb47-a47f-4d16-9b81-0e5736 manuals to require that establishments
Food Safety and Other Consumer 8f0c07/ConstUpdate083013.pdf?MOD= develop, implement, and maintain
Protection Regulations (e.g., Inspection AJPERES&CONVERT_TO=url& written procedures in their HACCP
System Operation, Product Standards CACHEID=9ad2eb47-a47f-4d16-9b81- plans, Sanitation SOPs, or other
and Labeling, and Humane Handling); 0e57368f0c07) that the PRC could prerequisite programs to ensure that
(3) Government Sanitation; (4) export processed poultry products to the carcasses with visible fecal
Government HACCP Systems; (5) United States. However, the CCA did contamination do not enter the chiller.
Government Chemical Residue Testing not adequately address all previously According to the letter, the manuals also
Programs; and (6) Government identified concerns about its poultry require establishments to develop,
Microbiological Testing Programs. slaughter inspection system. The CCA implement, and maintain written
From December 1 to 21, 2010, FSIS was able to meet the principal procedures in their HACCP plans,
conducted separate but concurrent on- requirements of the equivalence Sanitation SOPs, or other prerequisite
site audits of the PRC’s processed components for Government Sanitation, programs to prevent contamination of
poultry inspection system and the PRC’s Government HACCP Systems, carcasses and parts by enteric pathogens
poultry slaughter inspection system to Government Chemical Residue Testing and visible fecal material. The PRC
verify whether the CCA was able to Programs, and Government stated in the letter that these written
effectively implement a poultry Microbiological Testing Programs, but procedures must include sampling and
inspection system equivalent to that of FSIS found that the Government analysis for microbial organisms to
the United States. The auditors Oversight (e.g., Organization and monitor process control for enteric
concluded that the CCA was able to Administration) and Government pathogens. The PRC stated in the letter
meet the principal requirements for the Statutory Authority and Food Safety that it had adopted the U.S.
equivalence components of Sanitation and Other Consumer Protection requirements for NPIS, and that
and Chemical Residue Programs. Regulations (e.g., Inspection System establishments must get approval from
However, FSIS identified systemic Operation, Product Standards and their local official regulatory agency
inadequacies in both the PRC’s Labeling, and Humane Handling) before they may use the system. On
processed poultry inspection system components were not equivalent. September 1, 2016, the PRC sent copies
and the PRC’s poultry slaughter Specifically, the CCA still lacked a of their updated inspection manuals to
inspection system within the standardized method to assign FSIS. FSIS has reviewed the submitted
equivalence components for: inspection personnel to slaughter letter and updated inspection manuals
Government Oversight (e.g., facilities on the basis of objective and has determined that the PRC
Organization and Administration), measurements. The CCA responded to poultry slaughter inspection system is
Government Statutory Authority and these concerns, stating that it would equivalent with the new U.S. regulatory
Food Safety and Other Consumer implement changes to its poultry requirements in the August 21, 2014
Protection Regulations (e.g., Inspection slaughter inspection system. final rule.
System Operation, Product Standards From May 8 to 28, 2015, FSIS In summary, FSIS has completed the
and Labeling, and Humane Handling), conducted separate but concurrent on- document review, on-site audits, and
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Government HACCP Systems, and site audits to verify whether the PRC’s has verified that the PRC made
Government Microbiological Testing processed poultry inspection system necessary to corrective actions to its
Programs. For example, FSIS found that remains equivalent to the United States’ poultry slaughter inspection system in
the CCA lacked a standardized method system, and to verify whether the CCA response to the FSIS audits. Therefore,
to assign inspection personnel to adopted the necessary corrective FSIS has determined that, as
slaughter facilities based on objective measures to its poultry slaughter implemented, the PRC’s poultry
measurements such as production line inspection system. FSIS concluded, slaughter inspection system is
rates, inspection workloads, or line from the 2015 follow-up audits, that the equivalent to the United States poultry

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Document Created: 2017-06-16 00:52:23
Document Modified: 2017-06-16 00:52:23

Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Proposed Rules
Action		Proposed rule.
Dates		Comments must be received on or before August 15, 2017.
Contact		Dr. Daniel Engeljohn, Assistant Administrator, Office of Policy and Program Development; Telephone: (202) 205-0495.
FR Citation		82 FR 27625
RIN Number		0583-AD64

82 FR 27625 - Eligibility of the People's Republic of China (PRC) To Export to the United States Poultry Products From Birds Slaughtered in the PRC

DEPARTMENT OF AGRICULTUREFood Safety and Inspection Service

Federal Register Volume 82, Issue 115 (June 16, 2017)

DEPARTMENT OF AGRICULTURE
Food Safety and Inspection Service