[Federal Register Volume 77, Number 228 (Tuesday, November 27, 2012)]
[Proposed Rules]
[Pages 70724-70727]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-28746]


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DEPARTMENT OF AGRICULTURE

Food Safety and Inspection Service

9 CFR Part 381

[Docket No. FSIS-2012-0019]
RIN 0583-AD49


Eligibility of the Republic of Korea To Export Poultry Products 
to the United States

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 
add the Republic of Korea (Korea) to the list of countries eligible to 
export poultry products to the United States. Reviews by FSIS of 
Korea's laws, regulations, and inspection implementation show that its 
poultry inspection system requirements are equivalent to the Poultry 
Products Inspection Act (PPIA) and its implementing regulations. Under 
this proposal, slaughtered poultry or parts or other products thereof 
processed in certified Korean establishments would be eligible for 
export to 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 January 28, 2013.

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 on-line 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 8-163A, Washington, DC 20250-3700.
    Instructions: All items submitted by mail or electronic mail must 
include the Agency name and docket number FSIS-2012-0019. 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. Andreas Keller, Director, 
International Equivalence Staff, Office of International Affairs; 
telephone (202) 690-5646.

SUPPLEMENTARY INFORMATION: 

Background

    FSIS is proposing to amend its poultry products inspection 
regulations to add Korea to the list of countries eligible to export 
poultry products to the United States (9 CFR 381.196(b)). Korea is not 
currently listed as eligible to export such products 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 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)).
    In addition to a foreign country's legal authority and regulations, 
the program itself must be equivalent to the United States. 
Specifically, the program organized and administered by the national 
government must impose requirements equivalent to those of the United 
States with respect to: (1) Organizational structure and staffing, so 
as to ensure uniform enforcement of the requisite laws and regulations 
in all certified establishments; (2) ultimate control and supervision 
by the national government over the official activities of

[[Page 70725]]

employees or licensees; (3) 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, and their products, 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.
    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. To help the 
country in organizing its material, FSIS provides the country with a 
series of questions asking for detailed information about the country's 
inspection practices and procedures in six areas or equivalence 
components: (1) Government Oversight, (2) Statutory Authority and Food 
Safety Regulations, (3) Sanitation, (4) Hazard Analysis and Critical 
Control Point (HACCP) Systems, (5) Chemical Residue Testing Programs, 
and (6) Microbiological Testing Programs. 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 on-site review is scheduled using a multi-
disciplinary 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/Regulations_&_Policies/equivalence_process/index.asp.
    The PPIA and implementing regulations require that foreign 
countries be listed in the CFR as eligible to import poultry products 
into the United States. FSIS must engage in rulemaking to list a 
country as eligible. Countries found eligible to import poultry or 
poultry products into the United States are listed in the poultry 
inspection regulations at 9 CFR 381.196(b). Once listed, it is the 
responsibility of the eligible country to certify that establishments 
meet the requirements to export poultry or poultry products to the 
United States and to ensure that products from these establishments are 
safe, wholesome, and not misbranded. To verify that products imported 
into the United States are safe, wholesome, and properly labeled and 
packaged, FSIS re-inspects and randomly samples those products before 
they enter the United States commerce.

Evaluation of the Korean Poultry Inspection System

    In 2005, the government of Korea requested approval to export 
poultry products to the United States. If approved, Korea stated its 
immediate intention to export two types of ginseng chicken stew 
products to the U.S.:
     Jeukseok Samgyetang (instant ginseng chicken stew). 
Instant ginseng chicken stew is packed in a retort pouch, heat 
pasteurized, and stored and transported as a frozen poultry product. 
This is a ready-to-eat (RTE) poultry product.
     Gohyang Samgyetang (hometown ginseng chicken stew). 
Hometown ginseng chicken stew is a sterilized retort product, which is 
shelf-stable. This is a RTE poultry product.
    The ginseng used for the production of both poultry products, is an 
Oriental ginseng (Panax ginseng) and is added as a whole food and not 
as an extract. Therefore, it is not subject to premarket approval by 
the United States Food and Drug Administration (FDA).
    FSIS conducted a review of Korea's poultry (slaughter and 
processing) inspection system to determine whether it is equivalent to 
the United States' poultry inspection system. As indicated above, once 
a foreign country's system is determined equivalent to that of the 
United States, that country is eligible to import into the United 
States any poultry product. That is, a country is not then limited to 
importing a certain type of product, in this case, ginseng chicken 
stew.
    In October 2008, FSIS conducted the first on-site audit of Korea's 
poultry inspection system to evaluate the performance of the government 
of Korea with respect to the establishments it is proposing to certify 
as eligible to export poultry products to the United States. The audit 
resulted in the identification of systemic deficiencies within the 
following five equivalence components (as identified by component 
number): (1) Government Oversight, (3) Sanitation, (4) HACCP, (5) 
Chemical Residue Testing Programs, and (6) Microbiological Testing 
Programs. The audit findings stated that with regard to Component 1, 
Government Oversight, the central competent authority (CCA) did not 
have adequate government oversight and administrative controls over the 
inspection system. Inspection activities were being conducted by non-
government employees who were paid by the establishment, and the CCA 
did not provide evidence to demonstrate direct and continuous official 
supervision by the assigned government inspectors of processing 
activities for poultry products to ensure that adulterated or 
misbranded poultry products are not prepared for export to the United 
States. Regarding Component 3, Sanitation, there was a failure to 
implement and verify sanitation programs within the system. Likewise, 
for Component 4, HACCP, there was a failure to implement and verify 
HACCP requirements within the system. Lastly, with regard to Components 
5 and 6 on Chemical Residue Testing Programs and Microbiological 
Testing Programs, the FSIS auditors were unable to visit any of Korea's 
official laboratories that conducted chemical or microbiological 
analyses of poultry products.
    Following the 2008 on-site audit, Korea provided a corrective 
action plan addressing the findings identified during the 2008 on-site 
audit. FSIS reviewed the corrective action plan and concluded that 
Korea had not satisfactorily addressed all the audit findings.
    In November 2010, FSIS conducted a second on-site audit, which was 
more comprehensive then the audit conducted in 2008, which did not 
include a review of Korean laboratories. The 2010 audit was conducted 
to verify that Korea had satisfactorily implemented all the laws, 
regulations, and other issuances that FSIS found to be equivalent 
during the document analysis and to verify that the outstanding issues 
identified during the previous audit had been resolved. The 2010 audit 
resulted in the identification of systemic deficiencies within the 
equivalence components of: (2) Statutory Authority and Food Safety 
Regulations, (5) Chemical Residue Testing Programs, and (6) 
Microbiological Testing Programs. Specifically, the 2010 audit findings 
stated that with regard to Component 2, Statutory Authority and Food 
Safety Regulations, the CCA did not provide adequate control of 
establishment

[[Page 70726]]

facilities for post-mortem inspection. With regard to Component 5, 
Chemical Residue Testing Programs, the CCA did not provide adequate 
control over the implementation of laboratory quality systems within 
its National Residue Program. Finally, with regard to Component 6, 
Microbiological Testing Programs, the CCA did not provide adequate 
controls over the implementation of laboratory quality systems 
associated with microbiological testing of product which is intended 
for export to the U.S.
    Following the 2010 on-site audit, Korea provided a comprehensive 
corrective action plan that addressed the findings identified during 
the 2010 on-site audit. FSIS reviewed Korea's corrective action plan 
and concluded that Korea had satisfactorily addressed all audit 
findings. In addition, the November 2010 audit and the subsequent 
corrective action plan satisfactorily addressed all the findings of the 
October 2008 and November 2010 audits.
    In summary, FSIS has completed the document review, on-site audits, 
and verification of corrective actions as part of the equivalence 
process, and all outstanding issues have been resolved. FSIS has 
determined that, as implemented, Korea's poultry inspection system 
(slaughter and processing) is equivalent to the United States' poultry 
inspection system. The full report on Korea's poultry inspection system 
(slaughter and processing) can be found on the FSIS Web site at: 
http:[sol][sol]www.fsis.usda.gov/regulations/foreign_audit_reports/
index.asp.
    Should this rule become final, the government of Korea must certify 
to FSIS those establishments that wish to export poultry products to 
the United States and that operate in accordance with requirements 
equivalent to that of the United States. FSIS will verify that the 
establishments certified by Korea's government are meeting the United 
States requirements through verification audits of Korea'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 the United States Department of 
Agriculture's Animal and Plant Health Inspection Service (APHIS) 
regulations, which also regulate the exportation of poultry products 
from foreign countries to the United States.
    If this proposed rule is adopted, all slaughtered poultry, or parts 
and products thereof, exported to the United States from Korea 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 FDA), depending on the violation. The import re-inspection 
activities can be found on the FSIS Web site at 
http:[sol][sol]www.fsis.usda.gov/regulations_&_policies/fsis_
import_reinspection/index.asp

Executive Order 12866 and Regulatory Flexibility Act

    This proposed rule has been reviewed under Executive Order 12866 by 
the Office of Management and Budget (OMB) and has been determined to be 
not significant for purposes of E.O. 12866.

Economic Impact Analysis

    This proposed rule would add Korea to the list of countries 
eligible to export poultry products into the United States. Korea is 
seeking to export two types of ginseng chicken stew products to the 
United States. Given the limited market in the United States for this 
product, and the projected export volume of this product from Korea, 
the impact on the United States economy is likely to be very small. 
According to data from Korea, only two Korean establishments are 
interested in exporting ginseng chicken stew to the United States. The 
average combined annual production of these two establishments is 3.2 
million pounds (2006-2010 average), and their projected total export to 
the United States will be about 380,000 pounds in year one (the first 
year of exporting to the United States), gradually increasing to about 
2.25 millions pounds in year five, based on data from Korea.
    Ginseng chicken stew is sold commercially in frozen pouches. The 
United States market for ginseng chicken stew is so small that no data 
on domestic production, consumption, or importation could be found. 
Using label application data, FSIS identified two official 
establishments that produce and sell ginseng chicken stew. Based on 
information from these establishments, FSIS believes (1) they are very 
likely the only two establishments that are producing ginseng chicken 
stew in the United States, (2) the market for ginseng chicken stew is 
limited, (3) the annual production is about 18,000 pouches for one 
establishment and 10,000 pouches for the other, and (4) each pouch 
weighs about two pounds. Therefore, the combined production of these 
two establishments is about 56,000 pounds per year ((18,000 + 10,000) x 
2). The special flavor and taste make ginseng chicken stew unlikely to 
be a substitute for other kinds of chicken stew in the United States. 
Therefore, although this rule may affect these two U.S. establishments, 
the impact to the United States economy is likely to be insignificant.
    Expected benefits from this proposed rule will accrue primarily to 
consumers in the form of more choices in the marketplace. As mentioned 
above, the volume of trade stimulated by the proposed rule is likely be 
so small as to have little effect on supply and prices. Another 
potential benefit of this proposed rule would come from efficiency 
gains. The United States producers could become more efficient with 
increased competition from Korea.
    The cost of this rule would be incurred by domestic producers in 
the form of competition from Korea. Indeed, should this rule become 
final, the two establishments that are currently producing ginseng 
chicken stew are likely to encounter competition pressure, for the 
projected import volume in year one is already 6.8 times the combined 
production volume of these two establishments. The imported volume, 
however, is likely to have little impact on the overall United States 
economy. Also, these two establishments may change their production mix 
if they find it difficult to compete with imports.

Effect 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). As mentioned above, the expected trade volume will be 
very small, and the effect will be on only two very small 
establishments that produce ginseng chicken stew domestically.

[[Page 70727]]

Potential Long-Term Effect

    When foreign countries apply for equivalence of their meat, 
poultry, or egg product inspection systems, FSIS determines whether 
their inspection systems are equivalent to the system maintained by the 
United States. FSIS does not make equivalence determinations on the 
basis of particular products; rather, the equivalence decision is based 
on the evaluation of the foreign countries' inspection systems.
    Although Korea indicates that it intends to export two types of 
ginseng chicken stew products for now, it would not be precluded from 
exporting other poultry products in the future if the products meet all 
Animal and Plant Health Inspection Service (APHIS) requirements and any 
applicable FSIS regulations for those products. Therefore, the long-
term economic impact could be larger and more complex than can be 
assessed now.

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 system provides 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 Korea 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 number 0583-0094. The 
proposed rule contains no other paperwork requirements.

E-Government Act

    FSIS and the U.S. Department of Agriculture (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 communicated via Listserv, a free email 
subscription service consisting of industry, trade, and farm groups, 
consumer interest groups, allied health professionals, scientific 
professionals, and other individuals who have requested to be included. 
The Update also is available on the FSIS Web page. Through Listserv and 
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/News_&_Events/Email_Subscription/. Options range 
from recalls, export information, regulations, directives, and notices. 
Customers can add or delete subscriptions themselves, and have the 
option to password protect their accounts.

USDA Nondiscrimination Statement

    USDA prohibits discrimination in all its programs and activities on 
the basis of race, color, national origin, gender, religion, age, 
disability, political beliefs, sexual orientation, and marital or 
family status. (Not all prohibited bases apply to all programs.) 
Persons with disabilities who require alternative means for 
communication of program information (Braille, large print, audiotape, 
etc.) should contact USDA's Target Center at 202-720-2600 (voice and 
TTY).
    To file a written complaint of discrimination, write USDA, Office 
of the Assistant Secretary for Civil Rights, 1400 Independence Avenue 
SW., Washington, DC 20250-9410 or call 202-720-5964 (voice and TTY). 
USDA is an equal opportunity provider and employer.

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

    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]

    2. Section 381.196 is amended in paragraph (b) by adding ``Republic 
of Korea'' in alphabetical order to the list of countries.

    Done at Washington, DC, on: November 21, 2012.
Alfred V. Almanza,
Administrator.
[FR Doc. 2012-28746 Filed 11-26-12; 8:45 am]
BILLING CODE 3410-DM-P