[Federal Register: June 10, 2005 (Volume 70, Number 111)]
[Rules and Regulations]               
[Page 33803-33819]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr10jn05-4]                         

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DEPARTMENT OF AGRICULTURE

Food Safety and Inspection Service

9 CFR Parts 319 and 381

[Docket No. 92-024F]
Rin 0583-AC82

 
Food Standards: Requirements for Substitute Standardized Meat and 
Poultry Products Named by Use of an Expressed Nutrient Content Claim 
and a Standardized Term

AGENCY: Food Safety and Inspection Service, USDA.

ACTION: Final rule.

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[[Page 33804]]

SUMMARY: The Food Safety and Inspection Service (FSIS) is amending the 
Federal meat and poultry products inspection regulations to establish a 
general definition and standard of identity for standardized meat and 
poultry products that have been modified to qualify for use of an 
expressed nutrient content claim in their product names. These products 
will be identified by an expressed nutrient content claim, such as 
``fat free,'' ``low fat,'' and ``light,'' in conjunction with an 
appropriate standardized term, e.g., ``low fat bologna.'' FSIS is 
taking this action to: Assist consumers in maintaining healthy dietary 
practices by providing for modified versions of standardized meat and 
poultry products that have reductions of certain constituents that are 
of health concern to some consumers, such as fat, cholesterol, and 
sodium; increase regulatory flexibility and support product innovation, 
and provide consumers with an informative nutrition labeling system.

DATES: This final rule will be effective January 1, 2008, the uniform 
compliance date for all meat and poultry products subject to labeling 
regulations issued by FSIS between January 1, 2005 and December 31, 
2006. However, establishments may begin to produce meat and poultry 
products in compliance with this final rule anytime before the 
effective date.

FOR FURTHER INFORMATION CONTACT: Dr. Robert Post, Director, Labeling 
and Consumer Protection Staff, Office of Policy, Program, and Employee 
Development, Food Safety and Inspection Service, U.S. Department of 
Agriculture, Washington, DC 20250-3700; (202) 205-0279.

SUPPLEMENTARY INFORMATION: 

Background

    On December 29, 1995, FSIS published a proposed rule in the Federal 
Register to amend the Federal meat and poultry products inspection 
regulations to establish a general definition and standard of identity 
(the ``general standard'') for standardized meat and poultry products 
that have been modified to qualify for use of an expressed nutrient 
content claim in their product names (60 FR 67474). Under the proposed 
general standard, meat and poultry products with a regulatory standard 
of identity or composition in 9 CFR Parts 319 and 381, subpart P, would 
be permitted to be formulated and processed with ingredients otherwise 
not provided for, or in amounts greater than, that allowed by the 
standard in order to qualify for certain expressed nutrient content 
claims permitted in 9 CFR 317 subpart B and 381, subpart Y, such as 
``fat free,'' ``low fat,'' and ``light.'' Instead of being identified 
as ``substitute'' standardized meat and poultry products, as required 
by the current regulations (9 CFR 317.313(d) and 381.413(d)), 
standardized meat and poultry products formulated or processed in 
accordance with the proposed general standard could be identified by an 
expressed nutrient content claim in conjunction with the standardized 
term.
    To allow modified versions of standardized meat and poultry 
products that have been formulated to reduce their fat content to be 
marketed without having to be labeled as ``substitutes,'' FSIS issued 
Policy Memo 123, ``Modified Breakfast Sausage, Cooked Sausage, and 
Fermented Sausage Products Identified by a Nutrient Content Claim and a 
Standardized or Traditional Name,'' and Policy Memo 121B ``Labeling of 
Low Fat Ground Beef and Low Fat Hamburger Containing Added 
Ingredients,'' in January of 1995. These policy memoranda stated, among 
other things, that these products are permitted to be identified by a 
nutrient content claim that reflects the reduction in fat content in 
the product in conjunction with the appropriate standardized product 
name, e.g., ``Fat Free Bologna,'' ``Low Fat Pepperoni,'' or ``Low Fat 
Hamburger, Water, and Carrageenan Product.'' Both Policy Memo 121B and 
Policy Memo 123 were issued as interim measures until such time that 
rulemaking could be completed. Both of these policy memoranda will be 
rescinded by this final rule.
    In this final rule, FSIS is establishing a general definition and 
standard of identity for modified versions of meat and poultry products 
that substitute for meat and poultry products defined by a regulatory 
standard of identity or composition in 9 CFR Part 319 and 381, subpart 
P, i.e., ``substitute standardized products.'' This rule is needed to 
facilitate the development and availability of substitute standardized 
meat and poultry products that have reductions in constituents that are 
of health concern to some people, e.g., fat, cholesterol, and sodium. 
The rule allows FSIS to rely more on labeling requirements and less on 
restrictive recipe-type standards to carry out its mandate to ensure 
that the labels of meat and poultry products are truthful and not 
misleading to consumers.

Comments and Agency Response

    FSIS received 56 comments in response to the proposed rule from 
members of the meat and poultry processing industry, industry trade 
associations, members of the flavoring and ingredients industry, 
members of the soybean industry, academia, health professionals, 
governmental entities, consumer advocacy groups, and individual 
consultants. In general, the comments submitted in response to the 
proposed rule were favorable. Most commenters agreed that FSIS should 
establish a regulatory general standard for substitute standardized 
products that are lower in fat, cholesterol, or sodium.
    One commenter opposed the rule because the commenter believed it 
did not go far enough in providing flexibility to industry. This 
commenter stated that, rather than converting FSIS Policy Memo 123 into 
regulation, FSIS should create a new standard for substitute 
standardized meat and poultry products to allow the use of non-
traditional ingredients in all products, not just versions of products 
that are identified by a nutrient content claim and a standardized 
product name.
    Response: FSIS recognizes the need to explore this and other issues 
concerning reform of the meat and poultry product standards. However, 
expanding the use of non-traditional ingredients for all standardized 
products is an issue that is outside the scope of this rulemaking. The 
Agency is, however, exploring this and other related issues in a 
separate rulemaking to modernize meat and poultry product standards. 
This rulemaking is discussed in greater detail later in this document.

Policy Memo 123 and Policy Memo 121B

    Comment: A few commenters felt that FSIS Policy Memo 121B and 
Policy Memo 123 should remain in effect once this final rule becomes 
effective so that products produced under these policies can continue 
to be manufactured. Other commenters stated that the general standard 
defined in the proposed rule should apply to food products whose 
standards are documented in the FSIS Food Standards and Labeling Policy 
Book (the Policy Book), as well as those products whose standards of 
identity and composition are codified in Parts 319 and 381, subpart P. 
The commenters noted that the wording in proposed 9 CFR 319.10(a) and 
381.172(a) does not specifically include the standards described in the 
Policy Book, while FSIS Policy Memo 123 does. They were concerned that 
once the rule is in place, and Policy Memo 123 is rescinded, certain 
products, such as ``Low Fat Pepperoni,'' would no longer be permitted 
because pepperoni

[[Page 33805]]

does not have a standard of identity codified in the regulations.
    Response: The policy embodied in the proposed general standard will 
also apply to the informal standards for products, such as pepperoni, 
that are described in the Policy Book. Thus, Policy Memo 121B and 
Policy Memo 123 will not remain in effect once the proposed rule 
becomes final. FSIS issued both Policy Memo 121B and Policy 123 as 
interim measures to accommodate certain lower fat substitute meat and 
poultry products until such time that rulemaking was completed. This 
final rule incorporates, expands, and codifies the intent of these 
policy memoranda. Thus, rescinding Policy Memo 121B and Policy Memo 123 
will not preclude the production of products that have been made under 
those policies. The Agency intends to clarify this point in a policy 
bulletin, which is a more appropriate document for addressing the 
informal standards described in the Policy Book.

Nutrient Content Claims That Emphasize the Presence of an Ingredient

    Comment: Some commenters disagreed with the Agency's proposal to 
permit only expressed nutrient content claims that relate to reductions 
in constituents such as fat, cholesterol, or sodium, in conjunction 
with the standardized name of the substitute product. These commenters 
felt that nutrient content claims, such as ``high in'' and ``good 
source of,'' that emphasize the presence of an ingredient, should also 
be permitted to be used as part of the substitute standardized 
product's name, provided that the product qualifies for these claims 
under 9 CFR part 317 subpart B or 9 CFR 381 subpart Y.
    Response: Under the current regulations, meat and poultry products 
that satisfy the criteria for use of nutrient content claims defined in 
9 CFR part 317 subpart B and 9 CFR 381 subpart Y are permitted to make 
claims, such as ``high in'' or ``good source of,'' that emphasize the 
presence of a nutrient. The ability to make these kinds of nutrient 
content claims is not affected by this rulemaking.
    In the preamble to the proposed rule, FSIS noted that the meat and 
poultry product standards did not appear to preclude the making and 
marketing of standardized products that qualify for the use of claims 
such as ``high in'' and ``good source of.'' Therefore, in the proposed 
regulation, the Agency did not expressly provide for these types of 
nutrient content claims in the general standard. However, in the 
proposal, FSIS did solicit comments on whether current regulatory 
standards prevent the distribution of products with nutrient content 
claims other than those that reflect a reduction in the level of a 
nutrient.
    None of the comments received suggested that the existing meat and 
poultry product standards preclude the making and marketing of 
standardized products that qualify for the use of claims such as ``high 
in'' or ``good source of.'' Furthermore, because of the FSIS policy 
that precludes direct nutrient fortification of meat and poultry 
products, standardized meat and poultry products are not permitted to 
be modified to qualify to use a nutrient content claim by adding 
nutrients to the product. Therefore, FSIS has decided not to modify the 
scope of coverage in this final rule to permit nutrient content claims 
other than those that reflect a reduction of constituents that are of 
health concern to some people, e.g., fat, cholesterol, and sodium, to 
be used as part of the product name. Products that qualify for ``high 
in'' and ``good source of'' nutrient content claims may continue to 
highlight these claims as provided in 9 CFR 317.354 and 9 CFR 381.454.

Nutrient Fortification

    Comment: Four commenters suggested that FSIS reexamine its policy 
precluding direct nutrient fortification of meat and poultry products. 
Two of these commenters suggested that FSIS allow selective nutrient 
fortification in meat and poultry products to permit standardized 
products to be modified so that they qualify to use nutrient content 
claims, such as ``high in Vitamin A,'' as part of the product name. One 
of these commenters requested that FSIS modify the language in proposed 
9 CFR 319.10(a) to delete the following italicized words `` * * * 
because of a compositional deviation that results from reduction of a 
constituent that is described by an expressed nutrient content claim * 
* *''
    Another commenter suggested that FSIS permit selective protein 
fortification in substitute standardize products so that they may use 
claims such as ``High in Protein'' and ``Good Source of Protein'' as 
part of the product name. This commenter recommended that FSIS continue 
to require substitute standardized products to meet the same basic 
minimum meat and poultry content requirements contained in the existing 
meat and poultry product standards, but that the overall protein level 
in these products should be allowed to be fortified using ingredients 
such as soy protein. Another commenter that expressed support for 
permitting direct nutrient fortification of meat and poultry products 
felt that, because the over-consumption of protein in the American 
diet, that protein fortification should not be permitted.
    Two other commenters requested that FSIS allow fortification to 
replace vitamins and minerals that may be lost due to formulation 
adjustments to produce nutrient-modified foods. These commenters also 
requested that FSIS exempt substitute standardized products subject to 
the general standard from the minimum meat and poultry content 
requirements imposed by the existing meat and poultry product 
standards. Both commenters suggested that for these substitute 
products, FSIS should focus on nutritional equivalency to the 
traditional standardized product rather than meat content equivalency, 
and permit reductions in the meat and poultry content for purposes of 
reducing the product's fat content. The commenters stated that if FSIS 
were to permit such reductions in the meat and poultry content, 
fortification might be necessary to replace lost nutrients.
    One commenter suggested that, while existing FDA regulations state 
that the FDA does not consider it appropriate to fortify meat and 
poultry products (21 CFR 104.20(a)), the FDA regulations appear to make 
an exception for fortification of foods that replace traditional foods 
when fortification is necessary to avoid nutritional inferiority.
    Response: The comments requesting that FSIS reexamine its policy on 
nutrient fortification raise some interesting points, particularly with 
respect to the issues concerning nutritional equivalency versus meat 
content equivalency. However, the decision to allow fortification of 
meat and poultry products involves several complex issues, many of 
which are outside the scope of this rulemaking.
    FSIS'' fortification policy is derived from FDA's policy statement 
on nutrient fortification codified at 21 CFR part 104, subpart B, which 
states, in part, that the FDA ``* * * does not consider it appropriate 
to fortify fresh produce; meat, poultry, or fish products * * * (21 CFR 
104.20(a)). The fundamental objective of FDA's fortification policy is 
``* * * to establish a uniform set of principles that will serve as a 
model for the rational addition of nutrients to food'(21 CFR 
104.20(a)). As stated in its policy, FDA determined that, ``* * * 
random fortification of foods could result in over-or under-
fortification in consumer diets and create nutrient imbalances in the 
food supply'' (21 CFR 104.20(a)).

[[Page 33806]]

    FSIS has a long history of prohibiting direct fortification of meat 
and poultry products, which is supported by the codified FDA 
fortification policy. Thus, when determining whether to revise its 
nutrient fortification policy for meat and poultry products, FSIS must 
consider the issues in relationship to the codified FDA policy 
statement on fortification. Furthermore, in order to maintain 
consistent policies regarding nutrient fortification between the two 
agencies, any effort by FSIS to revise its prohibition on direct 
nutrient fortification of meat and poultry products should include FDA 
participation and involve the scientific community (e.g., the National 
Academy of Sciences, Institute of Medicine). FSIS, FDA, and the 
scientific community need to first consider the guiding scientific 
principles that form the basis for establishing a public health need 
for fortifying meat and poultry with nutrients. Only after these 
principles are applied could there be consideration of revising the 
current fortification policy.\1\ Obviously, this type of effort is 
outside the intended purpose and scope of this rulemaking. It would be 
more appropriate to consider this matter in a separate rulemaking where 
the Agency can receive the benefit of an open and thorough review of 
all issues related to the fortification of meat and poultry products.
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    \1\ See report: Institute of Medicine, National Academy of 
Science, 2003. Dietary Reference Intakes, Guiding Principles for 
Nutrition Labeling and Fortification. The National Academies Press, 
Washington, DC.
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    Furthermore, FSIS believes that the formulation adjustments needed 
to produce substitute standardized products with reductions in 
constituents such as fat, cholesterol, and sodium, will not result in a 
product that is nutritionally inferior to the product for which it is a 
substitute. Important nutrients, such as iron, zinc, B vitamins, and 
protein, are associated with the lean muscle portion of meat and 
poultry tissue, not the fat. Because the minimum meat and poultry 
requirement for substitute standardized products is not changed by this 
rule, reductions in the fat content should not affect the levels of 
nutrients associated with the lean muscle portion of these products. 
Therefore, nutrient fortification is not necessary to prevent the 
products subject to the general standard defined by this rule from 
being nutritionally inferior to the standardized products for which 
they are a substitute.

Differences in Performance Characteristics

    Comment: The proposed regulation stated that a substitute 
standardized product with performance characteristics, e.g., cooking 
quality, freezing quality, spreadability of product, and shelf-life, 
that materially limit the use of the product must include a disclaimer 
on the product's label adjacent to the product name informing the 
consumer of such differences.
    Most commenters agreed that limitations in a product's performance 
characteristics should be disclosed on the product label, and be 
conspicuous and readable. A number of commenters stated that the 
disclaimer should be adjacent to the most prominent claim on the label. 
One commenter, although in agreement with the disclaimer requirement, 
felt that disclosure on the label, not necessarily adjacent to the 
product name as provided in the proposed rule, was sufficient to inform 
the consumer of performance differences. This same commenter 
recommended that FSIS harmonize the requirement for labeling of 
performance differences with a similar FDA rule, which requires a 
disclaimer adjacent to the most prominent claim on the label (21 CFR, 
101.13(d)). Another commenter stated that the disclaimer should be 
adjacent to the most prominent claim and should most likely appear on 
the principal display panel.
    Response: In the preamble to the proposed rule, FSIS stated that 
``if there is a difference in performance characteristics that 
materially limits the use of the product, the product may still be 
considered a substitute if the label includes a disclaimer adjacent to 
the most prominent claim in accordance with 9 CFR 317.313(d)(1) and (2) 
and 9 CFR 381.413(d)(1) and (2), informing the consumer of such 
difference'' (60 FR 67480). However, in the text of the proposed rule, 
FSIS stated that the label must include, ``adjacent to the product 
name,'' a statement in accordance with 9 CFR 317.313(d)(1) and (2) and 
9 CFR 381.413(d)(1) and (2) informing the consumer of differences in 
performance characteristics (60 FR 67486, 67487). Thus, the preamble 
and the text of the proposed rule differed in that the preamble did not 
mention that the disclaimer must be ``adjacent to the product name.'' 
The regulations referenced by both the preamble and the text of the 
proposed rule, 9 CFR 317.313(d)(1) and 9 CFR 381.413(d)(1), require 
that differences in performance characteristics that materially limit 
the performance of a substitute product be disclosed adjacent to the 
most prominent claim on the product label.
    FSIS is resolving the discrepancy regarding placement of the 
disclaimer. FSIS agrees with the comment that disclosure on the label, 
not necessarily adjacent to the product name, is sufficient to inform 
the consumer of performance differences. Therefore, in this final rule, 
FSIS is not requiring that the disclaimer be placed adjacent to the 
product name. As in FDA regulations 21 CFR 130.10 and 101.13(d), a 
disclaimer for differences in performance characteristics shall be 
placed adjacent to the most prominent claim on the label. To reflect 
this decision, FSIS is removing the phrase ``adjacent to the product 
name'' from proposed Sec. Sec.  319.10(b)and 381.172(b).
    Comment: Two commenters disagreed with the need for the proposed 
disclaimer requirement and suggested that disclosure of any limitations 
in the performance characteristics of a substitute standardized product 
be voluntary. One of these commenters stated that disclaimers on a 
product's labeling informing consumers of performance characteristics 
that materially limit the use of the product need not be required by 
regulations because a substitute standardized product produced under 
the general standard will succeed or fail in the market place based on 
consumer expectations associated with the product's performance. This 
commenter stated that businesses would voluntarily place disclaimers on 
a product's label in the absence of a regulation requiring that they do 
so because it would be good business to inform consumers that a product 
they are purchasing can not be used in a traditional application.
    The other commenter agreed that, in practice, poorly formulated 
products would fail in the marketplace long before any regulatory 
system could determine that they did not meet the specific performance 
characteristics they would be expected to have. However, this commenter 
acknowledged that requiring a disclaimer informing consumers of 
limitations in a product's performance characteristics, when they 
exist, will require manufacturers of substitute standardized products 
to monitor performance characteristics during product development and 
may help ensure that new low- and reduced-fat standardized products are 
formulated well from the beginning. The commenter went on to state that 
consumers are also more likely to accept this category of substitute 
products if they are well formulated from the beginning.

[[Page 33807]]

    Response: FSIS disagrees with the commenters' suggestion that 
disclosure of performance characteristics that materially limit the use 
of a substitute standardized product compared to the use of the 
traditional standardized product should be voluntary. The FMIA and the 
PPIA require that the labeling of a meat or poultry product must be 
truthful and not misleading, and that such labeling accurately disclose 
to consumers what they are buying when they purchase any meat or 
poultry product. Information disclosing differences in performance 
characteristics that affect the use of a substitute standardized 
product (e.g., cooking quality, freezing quality, spreadability of 
product, and shelf life) is a material fact that must be disclosed on 
the labeling of these products. Without such labeling, consumers would 
be misled about significant characteristics and uses the product has 
compared to the standardized product for which it substitutes. 
Accordingly, this information must be communicated to consumers on the 
product's label, or the label will be misleading and the product will 
be misbranded under the FMIA or PPIA.
    Moreover, FSIS agrees with the commenter who suggested that 
processors are more likely to monitor the performance characteristics 
of substitute standardized products during product development when 
limitations in the product's performance characteristics are required 
to be disclosed on the product's labeling. FSIS also agrees that if 
substitute standardized products are well formulated from the 
beginning, it will promote consumer acceptance of this category of meat 
and poultry products.
    Comment: One commenter pointed out that it may be possible for 
performance characteristics to be introduced into a substitute 
standardized product that improve upon the performance characteristics 
of the traditional standardized product. The commenter suggested that 
the Agency consider substituting the term ``not inferior'' for `` 
similar'' in proposed 9 CFR 319.10(b).
    Response: FSIS did not intend to prohibit improvements in the 
performance characteristics of substitute products when it proposed 
that substitute standardized products subject to the general standard 
perform similarly to the traditional standardized products for which 
they substitute. However, FSIS disagrees that it should require that 
substitute standardized products have performance characteristics that 
are ``not inferior to'' rather than ``similar to'' the traditional 
standardized products as suggested by the commenter. As proposed, 
Sec. Sec.  319.10(b) and 381.172(b) permit products subject to the 
general standard to have limitations in performance characteristics 
provided that such limitations are properly disclosed on the product's 
labeling. The Agency believes that requiring disclosure of any 
performance limitations on the labeling of products subject to the 
general standard provides sufficient incentive for manufacturers of 
these products to market products that are not inferior to the 
traditional standardized products. Furthermore, proposed 9 CFR 
319.10(b) and 9 CFR 381.172(b) require a disclaimer for performance 
characteristics that ``materially limit'' the use of a substitute 
standardized product, not for characteristics that improve the 
performance of the product. Thus, the disclaimer requirement contained 
in proposed 9 CFR 319.10(b) and 9 CFR 381.172(b) will not discourage 
manufacturers from making improvements to the performance 
characteristics of substitute products when it is possible to do so.

Enforcement

    Comment: Two commenters questioned FSIS's ability to enforce and 
ensure uniform compliance with the performance characteristics 
requirements proposed in 9 CFR 319.10(b) and 381.172(b). One commenter 
asked how FSIS intends to determine differences in performance 
characteristics. The commenter went on to state that the proposed 
performance characteristics requirements seem to be ``command and 
control'' regulations that are not related to product safety. The other 
commenter stated that, in practice, poorly formulated products would 
fail in the marketplace long before any regulatory system could 
determine that they did not meet the specific performance 
characteristics discussed in the proposal.
    Response: FSIS expects that substitute standardized products that 
are produced under the general standard will conform to the performance 
characteristics requirements set forth in proposed 9 CFR 319.10(b) and 
381.172(b). To ensure that there is compliance, FSIS will examine the 
performance characteristics and product quality of substitute products 
as it would other types of products, through scientific review and 
experimental investigations. In addition, FSIS will use traditional 
methods available to the Agency, such as sample analysis, inspections, 
surveys, and follow-up investigations of consumer and trade complaints 
to identify products that do not comply with the new regulations in 
order to enforce this regulation as the need arises.
    Furthermore, FSIS disagrees with the comment that the proposed 
performance characteristics requirements are ``command and control'' 
regulations. Under Sec. Sec.  319.10(b) and 381.172(b), FSIS is not 
establishing specific criteria for determining similarities in 
performance characteristics. FSIS believes that judgments about 
similarity are best left to product developers, who have the incentive 
to market a product that resembles the traditional standardized product 
as closely as possible and to disclose product performance limitations 
to ensure that there is consumer satisfaction with the substitute 
standardized product.

Safe and Suitable Ingredients

    Comment: There was general agreement among the commenters that the 
ingredients used in a substitute standardized product produced under 
the general standard should be those ingredients provided by the 
traditional standard, with the exception of ``safe and suitable 
ingredients,'' as defined in (former) 9 CFR 318.7 and 381.147, at the 
minimum level necessary to improve texture and prevent syneresis. 
However, several commenters requested clarification and expansion of 
the ingredients permitted under this provision.
    Three commenters stated that allowances for ingredients should be 
broadened to include any safe and suitable ingredients to replace 
functional characteristics. These commenters all noted that the FSIS 
proposal limits ingredient usage to achieve textural improvement and to 
prevent syneresis. They felt that FSIS should build additional 
flexibility into the final rule to allow for a wider use of safe and 
suitable ingredients to replace functional characteristics that may be 
lost when a formulation is adjusted to meet a claim requirement. These 
commenters mentioned that the comparable FDA regulation allows the use 
of safe and suitable ingredients ``* * * to add flavor, extend shelf 
life, improve appearance, or add sweetness'' (21 CFR 130.10(d)). One 
commenter suggested that any ingredient that is generally recognized as 
safe (GRAS) or that is an approved additive should be permitted to be 
used as desired by the manufacturer. Another commenter stated that 
limiting the use of safe and suitable ingredients to the minimum level 
necessary to improve texture and to prevent syneresis severely limits 
the ability to produce a consumer-acceptable meat or poultry product. 
One

[[Page 33808]]

commenter specifically requested that FSIS clarify the acceptability of 
flavorings, especially meat flavorings, as safe and suitable 
ingredients in substitute standardized products.
    Response: For purposes of clarification, since it published the 
general standard proposal, FSIS issued the final rule ``Food 
Ingredients and Sources of Radiation Listed or Approved for Use in Meat 
and Poultry Products'' (64 FR 72168, December 23, 1999). The rule is 
intended to improve the efficiency of the procedures used by FSIS and 
FDA to review and approve the use of food ingredients and sources of 
radiation in the production of meat and poultry products. Under the new 
regulations, rather than listing substances approved for use in the 
production of meat and poultry products in the chart of substances 
contained in former 9 CFR 318.7(c)(4) and former 9 CFR 381.147(f)(4), 
FDA now lists food ingredients and sources of radiation that are safe 
for specific use in the production of meat and poultry products in its 
regulations in title 21 of the CFR. In the final rule, FSIS also 
created a list of food ingredients approved for use in the production 
of meat and poultry products by combining the listing contained in 
former section 318.7(c)(4) with the listing contained in former section 
381.147(f)(4) and moving the combined listing to section 424.21(c). The 
final rule became effective on January 24, 2000.
    FSIS did not include ingredients that would affect flavor, shelf 
life, or sweetness because these kinds of ingredients do not affect the 
ability of a manufacturer to modify a meat or poultry product to reduce 
fat, cholesterol, or sodium, which was the focus of this rulemaking. 
Thus, Sec. Sec.  319.10 and 381.172 provide only for increased amounts 
of safe and suitable ingredients that are needed to achieve the effect 
of replacing fat, i.e., binders, texturizers, and emulsifiers.
    As for the acceptability of flavorings in substitute standardized 
products, manufacturers will not be limited by Sec. Sec.  319.10 or 
381.172 in their ability to use ingredients that impart flavor. This 
final rule does not limit a manufacturer's ability to use safe and 
suitable meat and poultry flavorings.

``Fat Replacing'' Binders

    Comment: In the preamble to the proposed rule, FSIS provided a list 
of ``fat replacing'' binders to assist meat and poultry processors to 
understand the types of ingredients that are permitted to be used to 
achieve the effects of fat in making substitute standardized products 
under the general standard. However, the list was not intended to be 
all-inclusive. One commenter supported the use of ingredients not 
identified in the preamble as part of a fat replacement system and 
requested that FSIS clarify whether other fat replacers, such as milk 
protein concentrates, would be permitted in substitute standardized 
products, given this substance's similarities to the listed substances. 
The commenter also requested that the preamble to the final rule 
specifically note that milk protein concentrates and egg whites are 
acceptable substances in fat replacement systems.
    Three commenters agreed that the ingredients listed in the preamble 
are appropriate for use in a substitute version of a standardized 
product but felt that the list should be broadened to include other 
safe and suitable ingredients that have a demonstrated ability to 
function as a fat replacement system. One of these commenters requested 
that if the list provided within the context of the preamble is not 
meant to be all-inclusive, FSIS should state that fact. The commenters 
also encouraged FSIS to include a list of criteria for evaluating fat 
replacing binders not on the list to determine whether they qualify as 
acceptable binders.
    Response: The list of ``fat-replacing binders'' presented in the 
preamble to the proposed rule represents examples of ingredients or 
additives historically classified as binders by food scientists and 
ingredient technologists. This list is not intended to be all 
encompassing, and other safe and suitable ingredients historically 
recognized as binders are permitted to be used in ``fat replacement'' 
systems for substitute standardized products produced under the general 
standard.
    In general, a safe and suitable ingredient qualifies for use as a 
fat replacing binder under this final rule if it is only used for its 
functional properties and does not impart other characterizing 
qualities, such as taste and nutritional value, to the standardized 
product when used in the product formulation. FSIS will evaluate 
whether safe and suitable ingredients that were not listed in the 
preamble to the proposal qualify as fat replacing ingredients on a 
case-by-case basis.
    As a point of clarification, milk protein concentrates have 
historically been used by meat and poultry product manufacturers as 
binding ingredients in meat and poultry products and therefore, under 
the general standard, FSIS will permit milk protein concentrates to be 
used as binders in fat replacement systems for substitute standardized 
products.
    Regarding the use of egg whites as a fat replacing binder, egg 
whites are considered an egg product and as such function as an 
individual food product that is consumed for its own taste and 
nutritional value. Thus, FSIS considers the use of egg whites in the 
formulation of a meat or poultry product to be sufficiently 
characterizing so as to result in a product that is not a substitute 
standardized product, but one that is a non-standardized product, e.g., 
identified with a true product name, such as ``Low Fat Pork Sausage 
made with Egg Whites.''
    Although FSIS is not providing an all inclusive list of suitable 
fat replacing binders in this final rule, the Agency did provide an 
extensive listing of binders in the preamble to the proposed rule to 
convey the intent of the rule (see 60 FR 67481). Persons interested in 
determining whether an ingredient is an appropriate fat replacing 
binder may refer to this original listing.Furthermore, safe and 
suitable ingredients that meet the general criteria outlined above, 
i.e., have historically been classified as binders, are only used for 
their functional properties, and do not impart other characterizing 
qualities when used in the formulation of substitute products, will 
also qualify as acceptable fat replacing binders under this final rule.

Textured Vegetable Protein (TVP) as a ``Fat Replacer''

    Comment: In the preamble to the proposed rule, FSIS stated that the 
Agency views TVP as a ``meat or poultry replacer,'' and that the use of 
TVP as a fat replacing ingredient in a substitute standardized product 
subject to the general standard would be inappropriate. At the time 
that the proposal was published, FSIS had determined that the use of 
TVP in a substitute standardized product would change the nature of the 
product to such an extent that it would no longer be a substitute 
product within the parameters of the proposed rule. This view, in part, 
was based on the belief that TVP was used as a ``meat replacing'' 
ingredient in foods considered ``meat replacing products,'' such as 
``veggie-burgers,'' which are primarily TVP with water, flavorings, and 
seasonings.
    FSIS received numerous comments expressing strong disagreement with 
FSIS's historic views. Forty-three commenters submitted statements in 
support of allowing TVP as a fat replacer in substitute standardized 
meat and poultry products subject to the

[[Page 33809]]

general standard so that these products may be identified by a nutrient 
content claim. Many of these commenters provided supporting studies on 
the health and nutritional benefits of soy protein, along with data on 
consumer awareness and acceptance of products containing TVP. Many 
commenters felt that not permitting TVP as a fat replacing ingredient 
would greatly limit the ability of the industry to develop substitute 
standardized meat and poultry products that are lower in fat. These 
commenters stated that the use of TVP as a fat replacer is important in 
expanding the flexibility of the meat and poultry industry to create 
and market an increased variety of healthful substitute meat and 
poultry products. Some commenters specifically mentioned that 
prohibiting TVP would limit product development in areas of coarse 
ground cooked and fermented sausage.
    Several commenters stated that TVP should be permitted as a fat 
replacer so long as its use conforms to the requirements of the general 
standard. These commenters stated that TVP should be permitted as part 
of a ``fat replacement system'' in substitute standardized meat and 
poultry products so long as: (1) Its use does not substantially change 
the nature of the finished product; (2) it is not used to replace the 
meat or poultry content required by the traditional standard; and (3) 
it is used only at the minimum level necessary in a fat replacement 
system to qualify for use of the nutrient content claim.
    A number of commenters stated that TVP should be regulated on the 
basis of its functional properties rather than on its physical form. 
Many of these commenters pointed out that, while in the past TVP was 
used as a ``filler'' or ``substitute'' for meat components in food, 
advancements in TVP technology have made TVP a highly functional 
ingredient that could now be used as part of a fat replacement system 
to improve the textural character and quality of a substitute 
standardized meat or poultry product. Many commenters noted that TVP, 
when used in combination with other water binders, provides improved 
product texture, visual appearance, performance, and storage 
characteristics. Data supporting this view were presented to the 
Agency.
    Some commenters felt that TVP should be allowed as a fat replacer 
in all meat items where non-textured vegetable proteins are allowed. 
One commenter stated that texture is a matter of degree, and that forms 
of vegetable proteins range from fine powders, to small granules, to 
small flakes, to larger granules and flakes. This commenter stated that 
it is arbitrary to require that TVP be excluded as a ``fat replacer'' 
but not the powdered forms. One commenter questioned the logic of 
permitting soy flour, soy protein concentrate, and isolated soy protein 
in products because they replace fat, but prohibiting the use of TVP 
because it is inappropriately thought to replace meat. The commenter 
pointed out that the proposed rule does not permit a reduction in the 
meat or poultry content, and therefore, TVP could not be used as a meat 
replacer. Another commenter mentioned that other binders, such as 
carrageenan, can be texturized, and therefore, TVP is being singled out 
unfairly.
    A number of commenters stated that, because the presence of TVP can 
be disclosed in product labeling, consumers should be allowed to decide 
for themselves whether to purchase a lower fat standardized product 
that contains TVP. Some commenters pointed out that the presence of TVP 
in a meat food product could be communicated to consumers in the same 
manner as any other ingredient, in the ingredient statement. The 
commenters asserted that appropriate product labeling required by the 
general standard would ensure that consumers would not be misled about 
the presence of TVP in substitute standardized products produced.
    Some commenters stated that if TVP is permitted as a fat replacer 
in substitute standardized products, the substitute product should 
provide the same amount of animal protein as the traditional 
standardized product. One commenter stated that this approach would 
provide manufacturers with optimum flexibility, yet guarantees that the 
consumer receives a product that is at least as valuable as the 
unmodified product. Another commenter mentioned that consumers are 
interested in over-all nutrition, not in specific ingredients.
    Some commenters expressed the view that TVP should not be 
considered as a ``food,'' because it is not consumed by itself as a 
food. These commenters stated that TVP is a functional food ingredient 
that can be used as part of a fat replacement system.
    Response: FSIS has been persuaded by the comments, information, and 
other data submitted by commenters to permit the use of TVP as a part 
of a fat replacing system in substitute standardize products produced 
under the general standard. Accordingly, in this final rule, proposed 
Sec. Sec.  319.10(c) and 381.172(c) have been modified to provide for 
the use of TVP, alone or in combination with other binders and water, 
as part of a fat replacement system.
    The Agency will permit the use of TVP as a functional food 
ingredient that is used to replace fat. Like the other fat replacing 
ingredients permitted to be used under this final rule, the use of TVP 
as an ingredient in a substitute standardized product will be permitted 
only at the lowest level necessary to achieve the intended effect of 
replacing fat. When TVP is used to replace fat, the ingredients 
statement on the product label must alert the consumer to the fact that 
TVP is not permitted in the traditional standardized product or is used 
in excess of amounts permitted in the traditional standardized product. 
The labeling requirements will ensure that consumers will not be misled 
when TVP is used to replace fat in substitute standardized meat and 
poultry products subject to the general standard.
    Under this final rule, TVP may not be used to replace the meat or 
poultry content of a product when a product standard specifies a 
minimum meat or poultry content requirement. However, if the 
formulation of a substitute product produced under the general standard 
contains the same amount of meat or poultry prescribed by the 
traditional standard, the fat component of the meat or poultry in the 
substitute product may be removed during processing and replaced with 
TVP, or any other safe and suitable binder, alone or in combination 
with water as part of a fat replacement system.
    For example, the product standard for ``chili con carne'' provides 
that the product shall contain not less than 40% meat computed on the 
weight of the fresh meat (9 CFR 319.300). The product formulation for a 
substitute version of chili con carne produced under the general 
standard must contain 40% meat, but the fat content of the meat 
component may be replaced with TVP during processing.
    According to information presented to the Agency, TVP is 
particularly useful in developing lower fat versions of cooked sausages 
and other comminuted meat and poultry products. Although the standards 
for these kinds of products generally do not prescribe a minimum meat 
or poultry content, most of these standards limit the amount of fat 
that is permitted in the product. For example, the standard for cooked 
sausages defined in 9 CFR 319.180 limits the fat content of these 
products to no more than 30% of the finished product, and the standard 
for ground beef defined in 9 CFR 319.15 limits the fat content in this 
product to no more than 30%. Thus, under this final rule, the amount of 
TVP permitted in such

[[Page 33810]]

products will be limited by both the requirement that fat replacing 
ingredients may be used only at the lowest level necessary to replace 
fat and by the minimum fat content requirement established by the 
product standard.
    For example, a substitute cooked sausage produced under the general 
standard is permitted to contain up to 30% TVP, provided that the sole 
function of the TVP is to replace the fat. For purposes of this rule, 
FSIS does not consider replacing the fat component of a single 
ingredient standardized product, such as ground beef, as reducing the 
product's meat content, provided that the product complies with the 
manufacturing and labeling requirements prescribed in this final rule.
    To eliminate the possibility of confusion, the phrases ``textured 
vegetable protein shall not replace meat'' and ``textured vegetable 
protein shall not replace poultry,'' which were used as examples in the 
regulatory text of proposed 9 CFR 319.10(c)(2) and 381.172(c)(2), will 
be removed in the final rule. These phrases are unnecessary because the 
regulation already prohibits reductions in the meat or poultry content 
required by a regulatory standard regardless of whether TVP is used in 
the product.

Other Foods as ``Fat Replacers''

    Nine commenters indicated that in the final rule, FSIS should 
permit foods, such as bread, rice, potatoes, fruits, and vegetables to 
be used in substitute standardized meat and poultry products to reduce 
their fat content. Some of these commenters stated that these 
ingredients could serve the same role as the water and binder systems 
permitted as fat replacers in the proposed rule, but that food 
ingredients are more beneficial because they may contain some 
nutritional constituents, such as vitamins and minerals, that many 
binders do not. One commenter stated that food ingredients, when used 
at proper levels, help to provide consumers with substitute 
standardized products that perform similarly to traditional 
standardized products. Another commenter stated that the nutrition 
label would enable consumers to make informed purchase decisions based 
on the entire nutritional profile of the product. This commenter 
pointed out that many consumers would prefer the nutritional profile of 
substitute standardized products that use starchy vegetables and 
complex carbohydrates, such as rice and potatoes, rather than a 
combination of water and ingredients such as highly refined vegetable 
gums to lower the percentage of calories from fat. One commenter stated 
that it makes sense to allow other foods as fat replacers if the goal 
is to make more healthful products available to consumers. Another 
commenter suggested that consumers might be more interested in overall 
nutritional quality, taste, convenience, and performance of the product 
than in the specific ingredients present in the product.
    Response: FSIS concedes that because foods such as bread, rice, 
potatoes, fruits, and vegetables, have little or no fat, their use as 
ingredients in standardized meat and poultry product could have the 
effect of reducing the fat content of such products. However, when 
foods are used as ingredients in a standardized product, the 
composition of the product may be altered to such an extent that the 
resulting product is not a substitute version of the traditional 
standardized product but a new and different product with a separate 
identity that reflects the combination of the individual foods. For 
example, because diced apples and rice are not specified as ingredients 
in the standardized product ``Pork Sausage,'' when they are added to 
``Pork Sausage,'' the result is a new product, which, provided that it 
does not have a standard of identity or composition prescribed by 9 CFR 
part 319 or other established common or usual name, is required to bear 
a descriptive name, such as ``Pork Sausage with Diced Apples and 
Rice,'' that clearly identifies the product (see 9 CFR 317.2(c)(1) and 
(e) and 9 CFR 381.117(a)). Because the product ``Pork Sausage with 
Diced Apples and Rice'' is a new product and not a substitute version 
of the standardized product ``Pork Sausage,'' it is not the type of 
product that the general standard established by this final rule is 
intended to address.
    As a point of clarification, this final rule does not prevent non-
standardized meat and poultry products that use food ingredients to 
reduce their fat content from using a traditional nutrient content 
claim permitted under 9 CFR 317 subpart B and 381 subpart Y, provided 
they meet the requirements of the claim. For example, the product 
``Pork Sausage with Diced Apples and Rice'' is permitted to bear the 
claim ``low fat'' on its label if it complies with Sec.  317.362, and 
therefore, may be referred to as ``Low Fat Pork Sausage with Diced 
Apples and Rice.'' Consumers who prefer the nutritional profile of meat 
and poultry products that use other foods, rather than binders and 
water, or other functional food additives, to reduce their fat content 
will be able to identify these products by their descriptive product 
name and the traditional nutrient content claim on the product 
labeling. Furthermore, any benefits in the nutritional profile of 
products that use foods as ingredients to reduce their fat content will 
be reflected in the nutrition facts panel, as well, if appropriate, in 
other nutrient content claims.

Prohibited Ingredients

    Comment: One commenter expressed agreement with the provision in 
proposed 9 CFR 319.10(c)(3) and 381.172(c)(3) that states that 
ingredients specifically prohibited for use in standardized meat and 
poultry products should also be prohibited for use in substitute 
standardized products subject to the general standard. However, the 
commenter felt that ingredients prohibited from use in all meat and 
poultry products should be based on safety considerations rather than 
quality considerations.
    Response: The general standard allows for the use of any safe and 
suitable fat replacement ingredient, e.g., binders and water. Under the 
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.), FDA is 
responsible for determining the safety of food ingredients for use in 
food in general. Under the authority of the FMIA and PPIA, FSIS 
acquiesces to FDA's safety judgments, but FSIS determines the 
suitability of ingredients determined to be safe by FDA for use in meat 
and poultry products. These responsibilities are fully described in the 
final rule ``Food Ingredient and Sources of Radiation Listed or 
Approved for Use in the Production of Meat and Poultry Products,'' 
which was published in the December 23, 1999, Federal Register (64 FR 
72168).
    Thus, although it is the responsibility of the FDA to evaluate the 
safety of a substance for use in meat or poultry products, under the 
authority of the FMIA and PPIA, FSIS may preclude the use of a 
substance in meat or poultry products for reasons other than safety. 
There are instances in which the use of a substance, even if safe, may 
promote deception when used in a meat and poultry product, and, 
accordingly, such use would be prohibited by FSIS. For example, paprika 
is considered GRAS by FDA and is also listed for use as a color 
additive, but the FSIS regulations prohibit its use on fresh, uncooked 
meat products because such use adds color that may make the meat appear 
fresher than it actually is (9 CFR 424.23(a)(1)). Therefore, it is 
incumbent upon FSIS to consider suitability, as well as the safety, of 
ingredients for use in the production of meat and poultry

[[Page 33811]]

products in order to prevent these products from being adulterated or 
misbranded.

Processing Methods/Anatomical Location for Meat and Poultry Ingredients

    Comment: One commenter stated that the provision in proposed 
Sec. Sec.  319.10 and 381.172 that requires that the meat portion of a 
substitute standardized product undergo the same basic processing 
procedures as the traditional standardized product for which it is a 
substitute has the potential to limit the use of new technologies 
without producing any stated goal that would justify the limitation. 
The commenter stated, that as long as the substitute standardized 
product has performance characteristics that are similar to the 
traditional standardized product, and is produced only from authorized 
ingredients, additional restrictions on processing procedures are 
unnecessary and undesirable.
    Another commenter stated that the general standard should permit 
substitute standardized products to contain different meat species and 
different kinds of poultry than those prescribed by the traditional 
standard, and that it should permit meat or poultry from different 
anatomical locations than the locations prescribed by the traditional 
standard, provided that the difference in species or anatomical 
location is stated in the product name. This commenter felt that a 
literal reading of the proposed regulation could be interpreted to mean 
that products such as ``Beef Bacon'' or ``Pork Shoulder Bacon'' would 
no longer be permitted to include the term ``Bacon'' in their product 
names if coupled with a nutrient content claim. The commenter went on 
to say that these kinds of products should continue to be permitted to 
be marketed under the same familiar names that have been used in the 
past, and that use of a nutrient content claim next to the product name 
should not change this.
    Response: The intent of the general standard for substitute 
standardized products is to enable the meat and poultry industries to 
produce modified versions of standardized products that have reductions 
of certain constituents that are of health concern to some consumers, 
such as fat, cholesterol, and sodium, and to increase flexibility and 
support product innovation. Under this rule, deviations from the 
existing standards are not expected to result in a product that no 
longer resembles the original standardized product. Thus, the use of a 
different meat species or kind of poultry, or the use of meat or 
poultry from different anatomic locations from those specified in the 
standard, that results in a product that is so physically dissimilar 
from the traditional standardized product that it does not meet the 
definition of ``substitute'' set forth in 9 CFR 317.313(d) and 
381.413(d) would be inconsistent with the intent of this rule. For 
these kinds of products to represent themselves as substitute 
standardized products would be false and misleading under the FMIA and 
PPIA.
    As an illustration, the regulatory standard for ``Bacon'' under 9 
CFR 319.107 requires that this product be prepared from cured, sliced 
pork bellies. Curing and slicing a cut of meat from a different 
livestock species or from a different anatomical location, or preparing 
sliced pork bellies using a method other than curing, would result in a 
product with physical characteristics so different from the 
standardized product ``Bacon'' that the resulting product could not be 
considered a ``substitute'' for bacon under 9 CFR 317.313(d) and 
381.413(d). Thus, instead of being identified as a substitute product, 
the product would be identified by a descriptive term such as ``Beef 
Bacon'' or ``Pork Shoulder Bacon.''
    However, FSIS will consider the types of changes requested by the 
commenters, such as amending a standard to permit the use of 
alternative processing methods, on a case-by-case basis. FSIS agrees 
that certain technologies used to prepare standardized foods may yield 
a product with the same physical, nutritional, and sensory 
characteristics as the food made in accordance with the traditional 
standards. To reflect this fact, instead of specifying that substitute 
standardized products must contain all ingredients specifically 
required by a standard of identity or composition, and that the meat or 
poultry portion of substitute products come from the same anatomical 
location, be of the same kind and amount, and undergo the same basic 
processing procedures as the standardized product as was proposed, FSIS 
is revising Sec. Sec.  319.10(c)(4) and 381.172(c)(4) to require only 
that substitute standardized products comply with all other applicable 
standards of identity or composition.
    Regarding the comment expressing concern that under the general 
standard, products such as ``Beef Bacon'' or ``Pork Shoulder Bacon'' 
would no longer be permitted to include ``Bacon'' in their product 
names if coupled with a nutrient content claim, as previously 
mentioned, FSIS intends to apply the principles embodied in the general 
standard established by this final rule to other products as 
appropriate. The Agency will clarify this fact in a policy bulletin 
after this final rule is published.
    Thus, this final regulation will not prohibit the ``bacon-like'' 
products described in the Policy Book, such as ``Turkey Bacon-Cured 
Turkey Breast Meat-Chopped and Formed,'' from being modified to qualify 
to use a nutrient content claim as part of the product name. The 
modified version of this ``bacon-like'' product would be permitted to 
be identified as ``Low Fat Turkey Bacon-Cured Turkey Breast Meat-
Chopped and Formed.'' FSIS reiterates that the intent of this rule is 
to provide a wider array of nutritionally improved substitute products 
that would provide consumers with more meat and poultry products from 
which to choose. The intent is not to diminish or interfere with 
markets providing innovative as well as traditional kinds of products 
to consumers.

Minimum Meat and Poultry Requirement

    Comment: Several commenters submitted statements both for and 
against the proposed requirement that a substitute standardized product 
subject to the general standard rule maintain the same minimum meat or 
poultry requirement as the standardized product for which it is a 
substitute. Seven commenters agreed that substitute standardized 
products should be required to maintain the minimum meat and poultry 
requirement established by the traditional standard, while ten 
commenters expressed disagreement with this requirement.
    Several commenters stated that the meat or poultry content of a 
standardized product often contains the highest concentration of fat, 
and, while it may be theoretically possible for manufacturers to use 
leaner meat to reduce fat, it is not economical. One of these 
commenters stated that fat-reduced products that meet the existing 
minimum meat or poultry content requirement would be prohibitively 
expensive. Another commenter stated that relying exclusively on leaner 
meat to reduce fat might also make products tougher in texture and less 
palatable. Another commenter stated that, without reducing the ``meat 
block'' (meat or poultry content), the proposed general standard can 
not deliver on its promise to encourage innovation and the production 
of nutritionally improved meat and poultry products.
    Some commenters stated that minimum meat and poultry content 
requirements for substitute products are not necessary so long as the 
labeling of

[[Page 33812]]

the substitute standardized products provides sufficient information to 
distinguish these products from the traditional standardized products 
for which they substitute. One commenter submitted data showing that 
consumers do not mind if part of the meat block in a substitute product 
is replaced with another ingredient, so long as the labeling of the 
substitute standardized product discloses the presence of the replacing 
ingredient. Another commenter stated that trends in consumer behavior, 
which include reducing the amount of meat consumed in order to reduce 
fat intake, strongly support the argument that consumers will not be 
misled by nutrient-modified food products that contain less meat and 
poultry than is required by the traditional standardized form of the 
food. One commenter suggested that a substitute standardized product 
with reductions in its meat or poultry content should state on its 
label that, ``in order to reduce fat, this product contains less meat 
than the traditional standardized product.'' Some commenters stated 
that nutritional equivalency, rather than meat-content equivalency, 
should serve as the basis for defining requirements for the use of 
nutrient content claims. These commenters felt that FSIS should allow 
for necessary reductions in meat or poultry content to meet the 
requirements of the claim, with the reduction accomplished in such a 
manner that nutritional equivalency to the traditional standardized 
product is maintained. One commenter stated that meat replacers may be 
more desirable than some of the fat replacers, which hold water but 
contribute little in taste or nutritional value.
    One commenter stated that it is widely recognized that the 
requirements for minimum meat content are based on the notion that meat 
and poultry represented the most valuable constituent of a meat or 
poultry product. This commenter claimed that meat and poultry are 
simply no longer the indisputable ``highest value'' components of food 
products. Another commenter mentioned that FDA regulations provide for 
marketing of products, such as reduced-fat peanut butter, which allows 
for reduction of the peanut content of the product below that required 
for the standardized product.
    Those commenters that agreed with the requirement that substitute 
standardized products subject to the general standard maintain the same 
minimum meat and poultry requirement as the standardized product for 
which they are a substitute maintained that consumers have come to 
expect a certain amount of meat or poultry in products that bear a 
standardized term, and that the meat and poultry content of the product 
is still the most valued constituent.
    Response: Because many consumers have come to expect a certain 
amount of meat or poultry in products that bear a standardized term, 
deviations in the prescribed meat or poultry content will not be 
permitted in this final rule. Moreover, while FSIS appreciates these 
comments, the Agency does not view this rulemaking as the appropriate 
vehicle for changing the specific meat and poultry content requirements 
of meat and poultry product standards. These issues will be considered 
in a separate rulemaking that will examine FSIS's overall regulatory 
approach to standardized meat and poultry products that was described 
in the ANPR ``Meat and Poultry Standards of Identity and Composition'' 
published in the September 9, 1996, edition of the Federal Register (61 
FR 47453).
    In response to that ANPR, FSIS and FDA are jointly working on a 
more comprehensive approach to modernizing food standards whose goal is 
to establish ``general principles'' that interested parties could 
follow in requesting changes to food standards. One change that 
interested parties may be able to pursue, if these principles are 
adopted, would be reductions in the meat or poultry content 
requirements of standardized products. FSIS and FDA expect to soon 
publish the joint proposed rule in the Federal Register.

Nomenclature-Labeling of Nutrient Content Claims

    Comment: Of those who commented, all agreed that the name of a 
substitute standardized product subject to the general standard should 
be an expressed nutrient content claim in conjunction with (i.e., next 
to) the appropriate standardized term, as provided in the proposal. 
However, several commenters did not agree with the provision in 
proposed 9 CFR 319.10(d) and 9 CFR 381.172(d) that states that the 
nutrient content claim and standardized term should be presented ``in 
the same style, color, and size of type on the product label.''
    One commenter stated that it was unaware of any evidence that 
consumers are confused or misled by the labels currently in the 
marketplace on similar FDA-regulated products, which are not subject to 
a style, color, and size of type requirement. The commenter stated that 
the 3:1 type size requirement that generally applies to names on FSIS-
regulated products should apply to foods that are marketed under the 
general standard rule.
    Another commenter stated that some flexibility should be allowed 
for the type size of the nutrient content claim. The commenter stated 
that some product names are fairly lengthy, and therefore, FSIS's 
Policy Memo 87A , Word Size in Labeling of Product Names and Fanciful 
Names, states that the Agency will not object to a \1/3\ type size 
flexibility between the largest letter and the smallest letter in a 
product name. The commenter also noted that the existing FSIS 
regulations for nutrient content claims allow a \1/2\ type size 
flexibility to assure that nutrient claims are not disproportionately 
larger than the product's statement of identity.
    Two commenters stated that the FDA regulation establishing a 
general standard for FDA-regulated substitute standardized products (21 
CFR 130.10(e)) does not contain the same restrictions on the style, 
color, and size of type of the nutrient content claim that FSIS's 
proposed rule does. One of these commenters requested that FSIS 
consider modifying the proposed nomenclature for products subject to 
its general standard to make it similar in format to that prescribed by 
the FDA regulation. A similar comment suggested that FSIS delete the 
last clause from the nomenclature section, i.e., `` * * * which shall 
be in the same style, color, and size of type,'' because it is 
unwarranted and unnecessary to inform consumers of the nature of the 
substitute product.
    Response: FSIS agrees with the commenters' arguments and in this 
final rule has deleted the last clause from the nomenclature section 
(`` * * * which shall be in the same style, color, and size of type''). 
FSIS has been persuaded by the arguments against requiring the nutrient 
content claim portion of the substitute standardized product's name to 
be presented in the same style, color, and size of type, as the 
standardized product term and agrees that this requirement is 
unnecessary for consumers to distinguish the substitute product from 
other products that bear nutrient content claims but that are not 
substitute products that meet the requirements of this final rule. 
Therefore, to harmonize, to the extent possible, its labeling 
requirements with the labeling requirements of FDA's corresponding 
regulations found in 21 CFR 130.10, FSIS will not require that the 
expressed nutrient content claim that is part of the product identity 
appear in ``the same style, color, and size of type'' as the 
standardized term. The product name on the principal display panel of 
the substitute product,

[[Page 33813]]

as well as its ingredients statement, are the pertinent labeling 
features that identify the differences between the traditional 
standardized product and the modified version bearing the standardized 
name.

Ingredient Labeling

    Comment: Twenty commenters expressed agreement with the provision 
in proposed 9 CFR 319.10(e) and 381.172(e) that all safe and suitable 
ingredients not provided for by the traditional standard, as well as 
permitted ingredients added at a level in excess of those allowed by 
the traditional standard, must be appropriately identified as such with 
an asterisk in the ingredients statement. Three commenters disagreed.
    Two commenters stated that because a nutrient content claim calls 
the consumer's attention to the fact that the product has been modified 
from the traditional standardized product, there is no need for 
asterisks to be included in the labeling information. These commenters 
believed that the product name with the appropriate nutrient content 
claim, along with the ingredients statement, is all that is necessary 
to adequately inform the consumer that the product has been modified 
from the traditional standard. One commenter stated that, in addition 
to adding to label clutter, the requirement to highlight ingredients 
present in amounts greater than in the standardized product could 
result in the ``ludicrous'' situation where a label indicates that the 
substitute product contains more meat than the traditional standardized 
product. The commenter felt that requiring an asterisks for particular 
ingredients will provide a disincentive for meat and poultry processors 
to make products using the new technologies in fat replacement products 
because they must market products with labels that are cluttered with 
additional statements.
    One commenter expressed support for using an asterisk to identify 
ingredients not provided for, or used in excess of those levels 
provided for, by the traditional standard in so far as it provides 
parity with FDA's regulation but questioned the real value of this 
labeling feature to the consumer. The commenter suggested that this 
labeling requirement be applicable on a short-term basis, with 
provisions for its phase-out in no more than three years as consumer 
become more familiarly with nutritionally-modified foods.
    Two commenters felt that FSIS should require more than just the 
identification of the substitute ingredients in the ingredients 
listing, as proposed by the Agency. These commenters suggested that 
FSIS also require that whenever ingredients are present in the 
substitute product that are not permitted by the traditional product 
standard, an appropriate disclosure (e.g. ``made with non-standard 
ingredients--see back panel for ingredient lists'') appear on the 
principal display panel. One of these commenters stated that such a 
disclosure would alert consumers to the fact that a substitute product 
is different from the standardized product and would direct them to 
specific information about the differences.
    Several commenters requested that FSIS clarify whether the 
ingredient ``water'' or the added moisture not normally in or in excess 
of that permitted in a standardized product should be indicated with an 
asterisk.
    Response: FSIS disagrees with the comment that ingredients not 
provided for by the traditional standard, as well as permitted 
ingredients added at a level in excess of those allowed by the 
traditional standard, need not be identified as such with an asterisk 
in the ingredients statement. Differences between the ingredients in a 
standardized product and a substitute standardized product identified 
in part by a nutrient content claim must be highlighted so that 
consumers will be able to differentiate between the traditional 
standardized product and the substitute version. Highlighting these 
ingredient differences also ensures that the labeling of the substitute 
product will not be misleading. Furthermore, as a point of 
clarification, when water or added moisture not found in or used in 
excess of that permitted in a traditional standardized product is added 
to a substitute standardized product, this fact must be highlighted 
with an asterisk as is required for all other safe and suitable 
ingredients not found in, or used in excess of, the amount permitted by 
the traditional standard.
    FSIS disagrees with the comment that requiring an asterisks to 
highlight specific ingredients present in a substitute standardized 
product will provide a disincentive for meat and poultry processors to 
make and manufacture standardized products with reductions in their fat 
content. Similar labeling has been required on FDA-regulated products 
for several years and does not appear to have been a disincentive for 
industry to develop these kinds of products. FSIS also disagrees that 
labeling features in addition to those provided in the proposed rule 
are necessary to inform consumers of ingredient differences between a 
traditional standardized product and its nutritionally modified 
substitute. Highlighting ingredient differences with an asterisk in the 
ingredients statement, along with the product name on the principal 
display panel, are the pertinent labeling features that identify the 
differences between the traditional standardized product and the 
substitute version. Furthermore, to some consumers, statements such as 
``made with non-standard ingredients'' may imply that the ingredients 
used in a substitute product are inferior or harmful to the ingredients 
used in the traditional standardized product. Such statements could be 
misleading because only ingredients that have been found to be safe and 
suitable for use in meat and poultry products are permitted to be used 
in formulating substitute standardized products.
    Consumers who have purchased substitute standardized products 
manufactured pursuant to FDA's general standard codified at 21 CFR 
130.10 are familiar with the labeling of such products through the use 
of asterisks and the statement referenced by the asterisks, which 
appear adjacent to the ingredient list. Thus, many consumers already 
look to the ingredient statement to determine differences in 
formulation between traditional standardized products and nutritionally 
modified versions of these products. Harmonizing labeling to the extent 
possible with that of the FDA benefits consumers by providing a more 
consistent food labeling system across all foods.
    FSIS finds no merit in the comment that asterisks are unnecessary 
because they could lead to the ``ludicrous'' situation where an 
ingredients statement asterisk would indicate that more meat or poultry 
than required by the food standard has been used in the product. 
Because food standards for meat and poultry products generally require 
minimum amounts of meat and poultry and maximum amounts of fat and 
water, it has always been possible for manufacturers to include more 
meat or poultry than the minimum established by the food standard in 
the product formulation. This rule does not change that fact and there 
is no need to require an asterisk to highlight the fact that a 
manufacture chose to include more meat or poultry in a substitute 
product than the minimum required by the traditional standard.
    Regarding the comment that the asterisk provision should be phased 
out at some point in the future, FSIS does not agree with this view 
because the ingredient statement is the primary feature where the 
differences between the standardized product and the substitute version 
can be made known to the consumer in labeling. As

[[Page 33814]]

described earlier, during the joint FSIS and FDA standards 
modernization activities, if appropriate, the agencies may revisit the 
issue of phasing out the asterisk requirement and consider it within 
the context of a more comprehensive approach to food standards 
modernization.

The Final Rule

    In this final rule, FSIS is establishing a general definition and 
standard of identity for standardized meat and poultry products that 
have been modified to qualify for use of an expressed nutrient content 
claim in their product names in conjunction with a standardized term. 
FSIS is adding new Sec. Sec.  319.10 and 381.172 to the meat and 
poultry products regulations in title 9 of the CFR. As was proposed, 
Sec. Sec.  319.10(a) and 381.172(a) describe the type of meat and 
poultry products that are defined by the general standard. These are 
products that substitute, in accordance with 9 CFR 317.313(d) or 
381.413(d), for a standardized product, but that do not comply with the 
established standard because of a compositional deviation that results 
from reductions of a constituent that is described by an express 
nutrient content claim, such as ``low fat'' or ``fat free.''
    As was proposed, Sec. Sec.  319.10(b) and 381.172(b) require that a 
substitute standardized product subject to the general standard have 
similar performance characteristics to the traditional standardized 
product for which it is a substitute. However, if a substitute product 
has performance characteristics that materially limit the uses of the 
product compared to the uses of the traditional standardized product, 
Sec. Sec.  319.10(b) and 381.172(b) require that a product's label 
include a disclaimer informing consumers of such differences, such as 
``not suitable for grilling.'' In response to some of the comments and 
to be consistent with the existing definition of substitute products 
found in 9 CFR 317.313 and 381.413, FSIS is removing the provision in 
proposed Sec. Sec.  319.10(b) and 381.172(b) that would have required 
the performance characteristics disclaimer to appear ``adjacent to the 
product name.'' Deleting this provision is also intended to provide 
consistency with 21 CFR 130.10 of the FDA regulations, which is the 
codified general standard of identity for substitute standardized 
products under FDA jurisdiction. As was proposed, Sec. Sec.  319.10(b) 
and 381.172(b) will require that deviations in the ingredients in a 
substitute standardized product be the minimum necessary to qualify for 
the nutrient content claim.
    Sections 319.10(c) and 381.172(c) prescribe the ingredients that 
must be used in, and the ingredients that are permitted to be used in, 
substitute standardized products under the general standard. As was 
proposed, Sec. Sec.  319.10(c)(1) and 381.172(c)(1) require that the 
ingredients used in a substitute standardized product be those 
ingredients provided for by the traditional standard, except that in 
addition, safe and suitable ingredients may be used in the substitute 
product at the minimum level necessary to improve texture or prevent 
synereses. The final rule replaces references to former Sec. Sec.  
318.7 and 381.147 with the phrase ``as provided in a regulation 
permitting that use in this subchapter or in 9 CFR Chapter III, 
Subchapter E, or in 21 CFR Chapter I, Subchapter A or Subchapter B,'' 
to reflect the issuance of the final rule ``Food Ingredients and 
Sources of Radiation Listed or Approved for Use in Meat and Poultry 
Products'' (64 FR 72168).
    As was proposed, Sec. Sec.  319.10(c)(2) and 381.172(c)(2) forbid 
substitute standardized products to replace or exchange ingredients 
required by the traditional standard with functionally similar 
ingredients from other sources not provided for in the traditional 
standard. In the final rule, FSIS is removing the phrases ``textured 
vegetable protein shall not replace meat'' and ``textured vegetable 
protein shall not replace poultry'' from proposed Sec. Sec.  319.10 
(c)(2) and 381.172(c)(2). These phrases are unnecessary and could 
potentially cause confusion since the final rule permits TVP to be used 
in limited amounts as a fat replacer, although it may not be used to 
replace meat. Reductions in the meat or poultry content required by the 
traditional standard are already prohibited by the final rule 
regardless of whether TVP is used in the product.
    As was proposed, Sec. Sec.  319.10(c)(3) and 381.172(c)(3) prohibit 
substitute standardized products from containing ingredients that are 
prohibited for use in traditional standardized products. Proposed 
Sec. Sec.  319.10(c)(2) and(3), and 381.172(c)(2) and (3) use the 
phrase ``[a]n ingredient or component of an ingredient'' when 
describing the ingredients permitted and prohibited in substitute 
standardized products. In this final rule, FSIS is deleting the words 
``or component of an ingredient'' because they are unnecessary and may 
cause confusion.
    Proposed, Sec. Sec.  319.10(c)(4) and 381.172(c)(4) required 
substitute standardized products to conform to certain aspects of the 
traditional standard, such as the meat or poultry content specified in 
the standard, the anatomic location and kind of meat or poultry 
specified in the standard, and the processing procedures specified in 
the standard. As previously mentioned, deviations from these types of 
requirements may result in a product that is so physically dissimilar 
from the traditional standardized product that it does not come within 
the established definition of a substitute product.
    However, because certain technologies used to prepare standardized 
foods may yield a product with the same physical, nutritional, and 
sensory characteristics as the food made in accordance with the 
traditional standards, FSIS intends to consider certain deviations from 
product standards, such as alternative processing methods, on a case-
by-case basis. As stated above, FSIS and FDA are jointly working on a 
more comprehensive approach to modernizing food standards to establish 
``general principles'' that interested parties would follow in 
requesting changes to or creating new food standards. Therefore, FSIS 
is revising proposed Sec. Sec.  319.10(c)(4) and 381.172(c)(4) to 
require that substitute standardized products comply with all other 
applicable standards of identity or composition unless otherwise 
specified in part 319 or part 381. The Agency is making this revision 
to accommodate changes to food standards that may result from the joint 
FSIS/FDA food standards modernization approach.
    As was proposed, Sec. Sec.  319.10(c)(5) and 381.172(c)(5) permit 
water and fat-replacing binders to be used to reduce the fat content in 
a substitute standardized product subject to the general standard. 
Based on the comments and data submitted in response to the proposal in 
support of using TVP as a ``fat replacer,'' FSIS will permit the use of 
TVP as a functional fat replacing ingredient in substitute standardized 
products defined by the general standard. FSIS is adding new language 
to the final rule that permits the use of TVP as part of a fat 
replacement system at the lowest level necessary to achieve the 
technical effect of replacing the characteristics of fat in the 
substitute product. This language is found in new Sec. Sec.  
319.10(c)(6) and 381.172(c)(6). Because Sec. Sec.  319.10(c)(2) and 
381.172(c)(2) of the final rule forbid reductions in the meat or 
poultry content of a substitute product where one is established by a 
standard, under the final rule, TVP may only be used to replace fat 
component and not to replace the lean meat or poultry content of the 
substitute standardized product.

[[Page 33815]]

    Sections 319.10(d) and 381.172(d) prescribe the nomenclature for 
the substitute meat and poultry products that comply with the general 
standard. As was proposed, these products may be identified by the 
appropriate expressed nutrient content claim and the applicable 
standardized term (e.g., ``Fat Free Bologna''). If a product meets the 
requirements of the general standard, it is itself a standardized 
product, and therefore, its name will not be required to contain the 
term ``substitute'' despite the fact that it does not meet all of the 
requirements of the traditional product standard.
    This final rule removes the provisions in proposed Sec. Sec.  
319.10(d) and 381.172(d) that would have required that the expressed 
nutrient content claim part of the substitute standardized product's 
name appear in the ``same style, color and size type'' as the 
standardized term. This change is in response to public comments and to 
harmonize, to the extent possible, with similar FDA regulations.
    As was proposed, Sec. Sec.  319.10(e) and 381.172(e) require each 
of the ingredients used in the substitute product to be declared on the 
product label as required by the applicable FSIS regulations. 9 CFR 
parts 317 and 381, subpart N, require that all ingredients be listed by 
common or usual name in descending order of predominance by weight. As 
was proposed, Sec. Sec.  319.10(e) and 381.172(e) also require that all 
safe and suitable ingredients not provided for by the traditional 
standard, as well as those used in excess of those permitted by the 
traditional standard, be identified as such with and asterisks in the 
ingredients statement.

Executive Order 12866 and Regulatory Flexibility Act

    This rule has been determined to be significant and therefore has 
been reviewed by OMB under EO 12866.

I. Need for the Rule

    FSIS is issuing this rule to facilitate the development and 
availability of substitute standardized products that have reductions 
in certain constituents that are of health concern to some consumers, 
such as fat, cholesterol, and sodium. This rule allows FSIS to rely 
more on labeling requirements and less on restrictive recipe-like 
standards in endeavoring to ensure that the labels of meat and poultry 
products are truthful and not misleading as well as to improve the 
public health. The names of products covered by the General Standard 
will be composed of an express nutrient content claim that reflects the 
modifications made in formulating and processing the product (so that 
it qualifies to bear the claim) and an established standardized term. 
FDA has already promulgated a corresponding General Standard for the 
products that it regulates (21 CFR 130.10). By harmonizing an FSIS 
labeling requirement with that of FDA, this final rule represents a 
significant step towards providing consumers with an informative and 
consistent food standard and labeling system. This final rule also 
promotes product innovation by encouraging the production of meat and 
poultry products that are low in constituents that are of health 
concern to some people.

II. Description of Affected Industry

    FSIS regulations contain approximately 80 standards of identity or 
composition for meat and poultry products. Most of these standards are 
for processed products, including sliced, injected, smoked, fermented, 
heat-treated, and raw products. According to the Agency's Performance 
Based Inspection System Database, in the second quarter of 2003, there 
were approximately 6,600 Federal and State Establishments \2\ that 
potentially will be affected by the final rule if they develop and make 
available substitute products for standardized products. Some of these 
establishments, however, are already producing sausage and other 
comminuted meat and poultry products under FSIS Policy Memo 121B and 
Policy Memo 123 which provide for the type of substitute products 
defined under this final rule. Thus, this rule is likely to have little 
or no impact on the processing establishments that are producing 
products in accordance with the policy memos.
---------------------------------------------------------------------------

    \2\ These establishments processed, froze, stored, or otherwise 
held meat and poultry products.
---------------------------------------------------------------------------

    Ingredient manufacturers who produce binders and textured (source) 
protein products (e.g., textured soy or wheat protein) will be affected 
by the final rule because the rule will permit the increased use of 
these ingredients as fat replacing ingredients in some modified 
standardized products.

III. Costs

    The decision to produce products subject to the General Standard 
established by this rule is voluntary. Therefore, only those 
manufacturers that choose to produce and market these products will 
incur the direct costs imposed by this rule. These costs include 
research and development, production and marketing, and labeling 
production. However, because the rule is voluntary, companies that 
choose to produce products covered by the General Standard will do so 
only if they determine that the benefits of producing and selling these 
products outweigh the costs of complying with the final rule. 
Furthermore, companies that are already producing and marketing 
products under Policy Memo 121B and Policy Memo 123 (i.e., comminuted 
meat and poultry products) are likely to incur minimal or no costs as a 
result of this final rule.
    Under most circumstances, companies are likely to charge a premium 
for substitute standardized product produced in compliance with this 
final rule because many consumers will be willing to pay a premium for 
products with improved nutritional profiles. They view these products 
as ``value added'' products.\3\ Therefore, based on the experience of 
food companies that are operating under FDA's 21 CFR 130.10 
regulations, e.g., the manufacturers of fat-free ice cream and reduced 
fat cream cheese, any costs associated with producing and marketing 
substitute products most likely will be passed on to the consumer in 
the form of higher retail prices.
---------------------------------------------------------------------------

    \3\ Consumer purchasing trends.
---------------------------------------------------------------------------

    However, once this rule becomes effective, some companies that are 
not producing substitute meat and poultry products under Policy Memo 
121B or Policy Memo 123 may begin to manufacture and market substitute 
standardized products in accordance with the General Standard because 
of the market value of using traditional product names. Their decision 
to do so could have the effect of increasing the supply of these types 
of products in the short run, which could translate into lower prices 
for consumers.

IV. Benefits

    This rule will assist consumers in making dietary choices by 
providing for modified versions of standardized meat and poultry 
products that have reductions of certain constituents that are of 
health concern to some consumers, such as fat, cholesterol, and sodium. 
Therefore, there will be a greater opportunity for consumers to 
maintain or to initiate healthy dietary practices. In the United 
States, diets high in fat, cholesterol, and sodium are associated with 
chronic diseases such as coronary heart disease, cancer, stroke, and 
diabetes. In 2002, according to the Centers for Disease Control 
National Center for Chronic Disease Prevention and Health Promotion, 7 
out of every 10 U.S. deaths and more than 60% of medical care 
expenditures are attributed to chronic diseases. In addition, the

[[Page 33816]]

prolonged illness and disability associated with many chronic diseases 
decrease the quality of life for millions of consumers.

   Estimated Direct and Indirect Costs of Cardiovascular Diseases, Stroke, Diabetes, and Cancer in the United
                                                  States--2002
                                             [In Billion of Dollars]
----------------------------------------------------------------------------------------------------------------
                                                  Cardiovascular
                      Costs                          diseases         Stroke         Diabetes         Cancer
----------------------------------------------------------------------------------------------------------------
Direct..........................................          $168.7           $30.8           $92.0           $61.0
Indirect........................................           111.1            18.6            40.0           111.0
                                                 -----------------
    Total.......................................           279.8            49.4           132.0           172.0
----------------------------------------------------------------------------------------------------------------

    According to the 2002 Heart and Stroke Statistical Update published 
by the American Heart Association and the American Stroke Association, 
the total cost of cardiovascular diseases and strokes in the United 
States was estimated at $279.8 billion and $49.4 billion, respectively, 
as reflected in the above table and figure 1 below. Direct costs 
($168.7 billion and $30.8 billion, respectively) consist of the cost of 
physicians and other health professionals, hospital and nursing home 
services, medication, home health care, and other medical durables. 
Indirect costs ($111.1 billion and 18.6 billion, respectively) consist 
of lost productivity resulting from morbidity and mortality.
[GRAPHIC] [TIFF OMITTED] TR10JN05.003

    The total cost in 2002 associated with diabetes was $132 billion of 
which $92 billion were direct costs and $40 billion were indirect 
costs.\4\ The estimated total costs for all cancers in 2002 were $172 
billion ($61 billion in direct costs and $110 billion in indirect 
costs) \5\.
---------------------------------------------------------------------------

    \4\ ``The Economic Costs of Diabetes in the U .S. 2002'', 
American Diabetes Association.
    \5\ Heart Disease and Stroke Statistics--2003 Update, American 
Heart Association.
---------------------------------------------------------------------------

    Most chronic diseases are preventable, or their onset can be 
delayed, through increased physical activity and healthy eating. There 
is research to support that practicing good nutrition lowers the risk 
of chronic diseases for many consumers.\6\ The total estimated cost of 
chronic diseases to the consumer is $633.2 billion. The extent to which 
these costs might be reduced by an improved diet cannot be calculated 
precisely, but some researchers estimate that a balanced and healthful 
diet might forestall at least 20 percent of the annual deaths from 
heart disease, stroke, cancer, and diabetes.\7\
---------------------------------------------------------------------------

    \6\ CDC National Center for Chronic Disease Prevention and 
Health Promotion, ``Physical Activity and Good Nutrition: Essential 
Elements to Prevent Chronic Diseases and Obesity.''
    \7\ ``The American Diet: A Costly Health Problem, Food Review.''
---------------------------------------------------------------------------

    It is reasonably expected that the final rule could contribute to 
the reduction of these costs, but this contribution, too, cannot be 
calculated precisely. In the ``Economic Benefits of Nutrition Labeling: 
A Case Study for Fresh Meat and Poultry Products,'' the Agency 
estimated the potential benefits of reducing the incidence of coronary 
heart disease and three types of cancers at $61.8 million, (7 percent 
discount rate); and $125 million (3 percent discount rate).\8\
---------------------------------------------------------------------------

    \8\ The Agency estimated the potential benefit of an FSIS rule 
(2001). Nutrition Labeling of ground or chopped meat and poultry 
products and single-ingredient products. Federal Register, 66, 4969-
4999.
---------------------------------------------------------------------------

    The results of the 2002 ``Trends'' survey'' conducted by the Food

[[Page 33817]]

Marketing Institute (Trends in the United States, Consumer Attitudes 
and the Supermarket) stated that 80 percent of consumers surveyed 
indicated that they had sought out and purchased products based on 
``low-fat'' claims; 60 percent had purchased products because of ``low 
cholesterol'' claims; 59 percent purchased products because of 
``natural'' claims; and 52 percent purchased products because of ``low 
salt'' claims. If this trend continues, and the final rule is 
promulgated, it is more than likely that the final rule will assist in 
the reduced incidence of chronic diseases by expanding the availability 
of meat and poultry products with lower levels of constituents such as 
fat, cholesterol, and sodium.
    In conclusion, this final rule will assist consumers who want to 
reduce their dietary intake of fat, cholesterol, and sodium by 
encouraging the production of modified versions of traditional meat and 
poultry products that are formulated with fat, cholesterol, and sodium-
replacing ingredient systems that reduce these constituents. The final 
rule will provide parity with FDA's regulations and will promote a 
unified approach to food standards and labeling. Most importantly, the 
final rule supports national efforts to reduce the expenditures for 
health care and the cost of morbidity and lost productivity by 
permitting the introduction of modified, substitute foods.
    In terms of administrative benefits, the General Standard 
established by this final rule will permit industry to introduce 
modified, substitute versions of traditional standardized meat and 
poultry products without having to petition FSIS to establish new 
standards for products on a case-by-case basis. This will generate 
efficiency within the food standards system by saving time and 
resources that would have been expended by both the industry and FSIS 
to establish new or modified product standards. It will also permit 
companies to introduce standardized meat and poultry products with 
improved nutritional profiles into the marketplace in a timely manner, 
making such products more readily available to consumers.

V. Regulatory Flexibility Analysis

    The FSIS Administrator has made a final determination that this 
rule will not have a significant economic impact on a substantial 
number of small entities, as defined by the Regulatory Flexibility Act 
(5 U.S.C. 601).
    This final rule will not impose any new requirements on small 
entities. The decision to produce versions of standardized products 
that have been modified to qualify for use of an expressed nutrient 
content claim in conjunction with a traditional product name is 
voluntary. Therefore, the requirements of this final rule will only 
apply to those small manufacturers who choose to produce these types of 
products. Those small entities that choose to produce these products 
will be required to design new labels or to revise current labels to 
comply with this new rule, and thereby incur some costs. However, small 
entities who will be marketing these substitute products will most 
likely have anticipated that the revenues generated from the sale of 
these products will outweigh the costs of complying with the new 
regulation.

Executive Order 12988

    This final rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This final rule: (1) Preempts State and local 
laws and regulations that are inconsistent with this rule; (2) has no 
retroactive effect; and (3) does not require administrative proceedings 
before parties may file suit in court challenging this rule. However, 
the administrative procedures specified in 9 CFR 306.5, 381.35, and 
590.320 through 590.370 must be exhausted before any judicial challenge 
of the application of the provisions of this rule, if the challenge 
involves any decision of an FSIS employee relating to inspection 
services provided under the FMIA or PPIA.

Paperwork Reduction Act

    In accordance with section 3507(j) of the Paperwork Reduction Act 
of 1995 (44 U.S.C. 3501 et seq.), FSIS will submit the information 
collection and recordkeeping requirements in this final rule to the 
Office of Management and Budget (OMB) for approval.
    Title: Food Standards: Requirements for Substitute Standardized 
Meat and Poultry Products Named by Use of an Expressed Nutrient Content 
Claim and a Standardized Term.
    Type of collection: New.
    Abstract: Under this final rule, FSIS is requiring that 
establishments that produce meat and poultry products in accordance 
with the definition and general standard of identity for substitute 
standardized products design new product labels and submit sketches of 
the new labeling to FSIS for approval. To receive approval of the 
labels, establishments must complete FSIS form 7234-1. FSIS employees 
review FSIS form 7234-1 to ensure that information on the labels 
complies with the regulations.
    Estimate of burden: FSIS estimates that it will take 60 minutes to 
design and develop modified product labels in accordance with the final 
regulations and 15 minutes to prepare FSIS form 7234-1 and submit it, 
along with the label, to FSIS.
    Respondents: Establishments that produce substitute standardized 
meat or poultry products in accordance with this final rule.
    Estimated Number of Respondents: 100.
    Estimated Number of Responses per Respondent: 5.
    Estimated Total Annual Burden on Respondents: 625 hours.
    Copies of this information collection assessment can be obtained 
from John O'Connell, Paperwork Reduction Act Coordinator, Food Safety 
and Inspection Service, USDA, 112 Annex, 300 12th Street, SW., 
Washington, DC 20250. Comments are invited on (a) Whether the 
collection of information is necessary for the proper performance of 
the functions of the Agency, including whether the information will 
have practical utility; (b) the accuracy of the Agency's estimate of 
the burden of the collection of information, including the validity of 
the methodology and assumptions used; (c) ways to enhance the quality, 
utility, and clarity of the information to be collected, ways to 
minimize the burden of the collection of information on those who are 
to respond, including through the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques, 
or other forms of information technology. Comments may be sent to both 
John O'Connell, Paperwork Reduction Act Coordinator, at the address 
provided above, and the Desk Officer for Agriculture, Office of 
Information and Regulatory Affairs, Office of Management and Budget, 
Washington, DC 20253. To be most effective, comments should be sent to 
OMB within 30 days of publication.

Additional Public Notification

    Public awareness of all segments of rulemaking and policy 
development is important. Consequently, in an effort to ensure that the 
public and in particular minorities, women, and persons with 
disabilities, are aware of this final rule, FSIS will announce it on-
line through the FSIS Web page located at http://www.fsis.usda.gov/regulations_&_policies/2005_Interim_&_Final_Rules_Index/index.asp.
 The Regulations.gov Web site is the central online 

rulemaking portal of the United States government. It is being offered 
as a public service to increase participation in the Federal 
government's regulatory activities. FSIS participates in 
Regulations.gov and will

[[Page 33818]]

accept comments on documents published on the site. The site allows 
visitors to search by keyword or Department or Agency for rulemakings 
that allow for public comment. Each entry provides a quick link to a 
comment form so that visitors can type in their comments and submit 
them to FSIS. The Web site is located at http://www.regulations.gov/.

    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, recalls, 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 e-mail 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 an automatic and customized notification when popular pages 
are updated, including Federal Register publications and related 
documents. This service is available at http://www.fsis.usda.gov/news_and_events/email_subscription/
 and allows FSIS customers to sign up 

for subscription options across eight categories. Options range from 
recalls to export information to regulations, directives and notices. 
Customers can add or delete subscriptions themselves and have the 
option to password protect their account.

List of Subjects

9 CFR Part 319

    Food grades and standards, Meat inspection.

9 CFR Part 381

    Food grades and standards, Meat inspection, Poultry and poultry 
products.


0
For the reasons stated in the preamble, FSIS amends 9 CFR parts 319 and 
381 as follows:

PART 319--DEFINITIONS AND STANDARDS OF IDENTITY OR COMPOSITION

0
1. The authority citation for part 319 continues to read as follows:

    Authority: 7 U.S.C. 450, 1901-1906; 21 U.S.C. 601-695; 7 CFR 
2.18, 2.53.


0
2. Part 319, subpart A is amended by adding a new Sec.  319.10 to read 
as follows:


Sec.  319.10  Requirements for substitute standardized meat food 
products named by use of an expressed nutrient content claim and a 
standardized term.

    (a) Description. The meat food products prescribed by this general 
definition and standard of identity are those products that substitute, 
in accordance with Sec.  317.313(d), for a standardized product defined 
in this part and use the name of that standardized product in their 
statements of identity, but that do not comply with the established 
standard because of a compositional deviation that results from 
reduction of a constituent that is described by an expressed nutrient 
content claim that has been defined by regulation in part 317, subpart 
B, of this subchapter. The expressed nutrient content claim shall 
comply with the requirements of Sec.  317.313 of this subchapter and 
with the requirements of part 317, subpart B, of this subchapter which 
define the particular nutrient content claim that is used. The meat 
food product shall comply with the relevant standard in this part in 
all other respects, except as provided in paragraphs (b) and (c) of 
this section.
    (b) Performance characteristics. The performance characteristics, 
such as physical properties, functional properties, and shelf-life, of 
the meat food product shall be similar to those of the standardized 
meat food product produced under this part. If there is a significant 
difference in a performance characteristic that materially limits the 
use of the product compared to the use of the standardized product 
defined in this part, the label shall include a statement in accordance 
with Sec.  317.313(d)(1) and (2) of this subchapter that informs the 
consumer of such differences (e.g., if appropriate, ``not recommended 
for frozen storage'' or ``not suitable for roller grilling''). 
Deviations from the ingredient provisions of the standard must be the 
minimum necessary to qualify for the nutrient content claim, while 
maintaining similar performance characteristics.
    (c) Ingredients used in substitute products. (1) Ingredients used 
in the product shall be those ingredients provided for in the standard 
as defined in this part, except that safe and suitable ingredients 
permitted for use in meat food products as provided in a regulation 
permitting that use in this subchapter or in 9 CFR Chapter III, 
Subchapter E, or in 21 CFR Chapter I, Subchapter A or Subchapter B, may 
be used at the minimum level necessary to improve texture and prevent 
syneresis, so that the substitute product is not inferior in 
performance characteristics from the standardized product defined in 
this part for which it is a substitute.
    (2) An ingredient that is specifically required by the standard 
prescribed in this part shall not be replaced or exchanged with a 
similar ingredient from another source, for example, turnip chunks 
shall not replace potatoes in corned beef hash.
    (3) An ingredient that is specifically prohibited from use in any 
meat food product by this part shall not be added to the substitute 
meat food product under this section.
    (4) Unless otherwise specified in this part, a substitute meat food 
product must meet all other requirements of the applicable standards of 
identity or composition.
    (5) Water and fat-replacers (e.g., binders), in combination, may be 
added to replace fat in accordance with paragraph (c) of this section.
    (6) Textured vegetable protein may be used by itself or in 
combination with other binders and water as a fat replacer in 
accordance with paragraph (c) of this section.
    (d) Nomenclature. The name of a substitute meat food product that 
complies with all parts of this section is the appropriate expressed 
nutrient content claim and the applicable standardized term.
    (e) Label declaration. (1) Each of the ingredients used in the 
substitute meat food product shall be declared on the label as required 
by this section and part 317 of this subchapter.
    (2) Ingredients not provided for, and ingredients used in excess of 
those levels provided for, by the standard as defined in this part, 
shall be identified as such with an asterisk in the ingredients 
statement. The statement ``*Ingredients not in regular --------'' (the 
blank shall be filled in with the name of the traditional standardized 
product) or ``**Ingredients in excess of amounts permitted in regular 
--------'' (the blank shall be filled in with the name of the 
traditional standardized product), or both, as appropriate, shall 
immediately follow the ingredients statement in the same type and size.

PART 381--POULTRY PRODUCTS INSPECTION REGULATIONS

0
3. The authority citation for part 381 would continue to read as 
follows:

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


0
4. Part 381, subpart P is amended by adding a new Sec.  381.172 to read 
as follows:

[[Page 33819]]

Sec.  381.172  Requirements for substitute standardized poultry 
products named by use of an expressed nutrient content claim and a 
standardized term.

    (a) Description. The poultry products prescribed by this general 
definition and standard of identity are those products that substitute, 
in accordance with Sec.  381.413(d), for a standardized product defined 
in this subpart and use the name of that standardized product in their 
statements of identity, but that do not comply with the established 
standard because of a compositional deviation that results from 
reduction of a constituent that is described by an expressed nutrient 
content claim that has been defined by regulation in this subpart. The 
expressed nutrient content claim shall comply with the requirements of 
Sec.  381.413 and with the requirements in subpart Y of this part which 
define the particular nutrient content claim that is used. The poultry 
product shall comply with the relevant standard in this part in all 
other respects, except as provided in paragraphs (b) and (c) of this 
section.
    (b) Performance characteristics. The performance characteristics, 
such as physical properties, functional properties, and shelf-life, of 
the poultry product shall be similar to those of the standardized 
poultry product produced under subpart P of this part. If there is a 
significant difference in a performance characteristic that materially 
limits the use of the product compared to the use of the standardized 
product defined in subpart P of this part, the label shall include a 
statement in accordance with Sec.  381.413(d)(1) and (2) of this part, 
that informs the consumer of such differences (e.g., if appropriate, 
``not recommended for frozen storage'' or ``not suitable for roller 
grilling''). Deviations from the ingredient provisions of the standard 
must be the minimum necessary to qualify for the nutrient content 
claim, while maintaining similar performance characteristics.
    (c) Ingredients used in substitute products. (1) Ingredients used 
in the product shall be those ingredients provided for in the standard 
as defined in subpart P of this part, except that safe and suitable 
ingredients permitted for use in poultry products as provided in a 
regulation permitting that use in this subchapter or in 9 CFR Chapter 
III, Subchapter E, or in 21 CFR Chapter I, Subchapter A or Subchapter 
B, may be used at the minimum level necessary to improve texture and 
prevent syneresis, so that the substitute product is not inferior in 
performance characteristics from the standardized product defined in 
subpart P of this part for which it is a substitute.
    (2) An ingredient that is specifically required by the standard 
prescribed in subpart P of this part shall not be replaced or exchanged 
with a similar ingredient from another source, for example, extruded 
turnips shall not replace noodles in poultry with noodles.
    (3) An ingredient that is specifically prohibited from use in any 
poultry product by subpart P of this part shall not be added to the 
substitute poultry product under this section.
    (4) Unless otherwise specified in this part, a substitute poultry 
product must meet all other requirements of the applicable standards of 
identity or composition.
    (5) Water and fat-replacers (e.g., binders), in combination, may be 
added to replace fat in accordance with paragraph (c) of this section.
    (6) Textured vegetable protein may be used by itself or in 
combination with other binders and water as a fat replacer in 
accordance with paragraph (c) of this section.
    (d) Nomenclature. The name of a substitute poultry product that 
complies with this section is the appropriate expressed nutrient 
content claim and the applicable standardized term.
    (e) Label declaration. (1) Each of the ingredients used in the 
substitute poultry product shall be declared on the label as required 
by this section and subpart N of this part.
    (2) Ingredients not provided for, and ingredients used in excess of 
those levels provided for, by the standard as defined in subpart P of 
this part, shall be identified as such with an asterisk in the 
ingredients statement. The statement ``*Ingredients not in regular ----
----'' (the blank shall be filled in with the name of the traditional 
standardized product) or ``**Ingredients in excess of amounts permitted 
in regular --------'' (the blank shall be filled in with the name of 
the traditional standardized product), or both, as appropriate, shall 
immediately follow the ingredients statement in the same type and size.

    Done in Washington, DC, on June 6, 2005.
Barbara J. Masters,
Acting Administrator.
[FR Doc. 05-11493 Filed 6-9-05; 8:45 am]