Trade Groups Call for Clear Delineation of Importer Responsibilities in FSVP Rule

The Food and Drug Administration’s revised Foreign Supplier Verification Program proposal is a step in the right direction, but there are still ambiguous and burdensome requirements that need to be ironed out, according to several trade associations in comments on FDA’s September supplemental proposed rule. Several sets of comments, including from the Association of American Exporters and Importers, the National Customs Brokers & Forwarders Association of America, and the Cheese Importers Association of America, continued to highlight identification of the “FSVP Importer” tasked with complying with FSVP as a main concern.

FDA issued its supplemental proposed rule in response to comments from industry that FDA said “led to significant changes” in its thinking on the original proposals (see 14092901), issued in July 2013 (see 13072628). Changes include a more flexible approach to rules requiring importer verification of their suppliers, and requiring analysis only of hazards that are “significant.”

AAEI welcomed the changes in comments dated Dec. 12. The trade group said it encouraged a risk based approach in comments on the original proposed rule, and is “happy to see” FDA took its comments into account, particularly with respect to the increased options given to importers for verifying their suppliers. But the association’s food importer members “continue to feel that the entire proposed rule is extraordinarily complex and the proposed FSVP program potentially introduces onerous amounts of new data management, recordkeeping requirements and processes to implement FSVP,” said AAEI. “Therefore, we look forward to continued dialogue with the FDA on this issue.”

A common thread throughout several sets of comments was potential problems identifying the FSVP Importer responsible for complying with the program’s verification requirements. FDA has been clear that it will not simply require the Importer of Record to comply with FSVP, instead looking to the party with a direct financial interest in the food product (and therefore the most knowledge to conduct a verification). Indeed, the FSVP Importer will often be far removed from the Importer of Record, and FDA needs to flesh out its regulations and policies to take that into account, the groups said. “Many transactions involve multiple parties,” said AAEI. “As such, our members are particularly concerned there will be a lack of clarity on any given transaction as to which party is the FSVP importer.”

The proposed rule also raises questions on how the FSVP Importer will be identified. Under the supplemental proposal, where there is no U.S. buyer or consignee, the foreign agent of the foreign owner of the imported food would act as the FSVP Importer. Given the importance that agents of foreign suppliers will have in FSVP, the NCBFAA called on FDA to clarify the role of U.S. agents for FSVP purposes. Specifically, FDA should require that, when there is no U.S. owner or consignee of imported food, the foreign importer should be required to affirmatively contract with a U.S. person or entity to be its agent, said the NCBFAA.

Both AAEI and the NCBFAA asked FDA to clarify the way in which the FSVP Importer will be identified, with the NCBFAA calling on FDA to require that the DUNS number of the FSVP importer be identified on entry documentation. Even when the importer of record is not the FSVP importer, it should still be the party responsible for identifying the party responsible with complying with FSVP requirements, said the NCBFAA. However, AAEI said FDA should not rely on the DUNS number at all. Instead, importers should be allowed to use their importer of record numbers to identify themselves. DUNS numbers are not usually managed by import compliance departments, and a single company with multiple addresses may use multiple DUNS numbers. Even though DUNS numbers are free, importers would incur costs related to modifying internal systems and relationships with brokers in order to comply with the new numbering system.

There also needs to be a mechanism in place to allow an importer to import food where all of the hazards are controlled by a subsequent facility that is not the importer’s customer, said the Cheese Importers Association of America and the Association of Food Industries in comments dated Dec. 15 (here). The supplemental proposed rule does not address situations where, for instance, imported tree nuts will be roasted not by the importer’s customer, but rather by the importer’s customer’s customer, and the importer often cannot get a written assurance that the roasting facility is controlling the hazards. FDA should instead recognize contractual provisions requiring each customer down the chain control for hazards.

FDA could also make changes outside of the rulemaking process that would help importers verify their suppliers and implement FSVP. The agency’s website could be improved by creating searchable Import Alert and warning letter databases, so that importers can easily vet their suppliers have been in trouble without having to comb through the website manually. FDA should also create a database similar to CBP’s CROSS database for customs rulings that would allow importers to find how FDA has handled various situations arising from FSVP involving specific commodities, source countries, and end users.

Email ITTNews@warren-news.com for a copy of the comments from NCBFAA or AAEI.