[Federal Register: May 20, 2005 (Volume 70, Number 97)]
[Proposed Rules]               
[Page 29214-29235]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr20my05-16]                         

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DEPARTMENT OF AGRICULTURE

Food Safety and Inspection Service

9 CFR Part 410

[Docket No. 95-051P]
RIN 0583-AC72

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Part 130

[Docket No. 1995N-0294]
RIN 0910-AC54

 
Food Standards; General Principles and Food Standards 
Modernization

AGENCIES: Food Safety and Inspection Service, USDA; Food and Drug 
Administration, HHS.

ACTION: Proposed rule.

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SUMMARY: The Food Safety and Inspection Service (FSIS) and the Food and 
Drug Administration (FDA) (we, our, the agencies) are proposing to 
establish a set of general principles for food standards. The adherence 
to these principles will result in standards that will better promote 
honesty and fair dealing in the interest of consumers and protect the 
public, allow for technological advances in food production, be 
consistent with international food standards to the extent feasible, 
and be clear, simple, and easy to use for both manufacturers and the 
agencies that enforce compliance with the standards. The proposed 
general principles will establish the criteria that the agencies will 
use in considering whether a petition to establish, revise, or 
eliminate a food standard will be the basis for a proposed rule. In 
addition, each agency may propose to establish, revise, or eliminate a 
food standard on its own initiative or may propose revisions to a food 
standard in addition to those a petitioner has requested. These 
proposed general principles are the agencies' first step in instituting 
a process to modernize their standards of identity (and any 
accompanying standards of quality and fill of container) and standards 
of composition.

DATES: Submit written or electronic comments by August 18, 2005.

ADDRESSES: You may submit comments to FSIS, identified by Docket No. 
95-051P, by any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 

Follow the instructions for submitting comments.
     Mail/Hand delivery/Courier (For paper, disk, or CD-ROM 
submissions):
    Send an original and two copies of comments to: FSIS Docket Clerk, 
Docket No. 95-051P, rm. 102, Cotton Annex Bldg., 300 12th St. SW., 
Washington, DC 20250-3700.
    Instructions: All submissions received must include the agency name 
and Docket No. 95-051P or regulatory information number (RIN) 0583-
AC72.
    Other Information: All comments submitted in response to this 
proposal, as well as research and background information used by FSIS 
in developing this document, will be available for public inspection in 
the FSIS Docket Room at the address listed above between 8:30 a.m. and 
4:30 p.m., Monday through Friday. The comments also will be posted on 
the Agency's Web site at http://www.fsis.usda.gov/OPPDE/rdad/FRDockets.htm
.

    You may submit comments to FDA, identified by Docket No. 1995N-0294 
and/or RIN 0910-AC54, by any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 

Follow the instructions for submitting comments.
     Agency Web site: http://www.fda.gov/dockets/ecomments. 

Follow the instructions for submitting comments on the agency Web site.
     E-mail: fdadockets@oc.fda.gov. Include Docket No. 1995N-
0294 and/or RIN 0910-AC54 in the subject line of your e-mail message.
     FAX: 301-827-6870.
     Mail/Hand delivery/Courier (For paper, disk, or CD-ROM 
submissions):

[[Page 29215]]

    Division of Dockets Management, 5630 Fishers Lane, rm. 1061, 
Rockville, MD 20852.
    Instructions: All submissions received must include the agency name 
and Docket No. 1995N-0294 or RIN 0910-AC54. All comments received will 
be posted without change to http://www.fda.gov/ohrms/dockets/default.htm
, including any personal information provided. For detailed 

instructions on submitting comments and additional information on the 
rulemaking process, see the ``Comments'' heading of the SUPPLEMENTARY 
INFORMATION section of this document.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.fda.gov/ohrms/dockets/default.htm 

and insert the docket number, found in brackets in the heading of this 
document, into the ``Search'' box and follow the prompts and/or go to 
the Division of Dockets Management, 5630 Fishers Lane, rm. 1061, 
Rockville, MD 20852.

FOR FURTHER INFORMATION CONTACT: FSIS: Robert C. Post, Labeling and 
Consumer Protection Staff, rm. 602, Cotton Annex Bldg., 1400 
Independence Ave. SW., Washington, DC 20250-3700, 202-205-0279.
    FDA: Ritu Nalubola, Center for Food Safety and Applied Nutrition 
(HFS-820), Food and Drug Administration, 5100 Paint Branch Pkwy., 
College Park, MD 20740, 301-436-2371.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Background
    A. FSIS Food Standards
    B. FDA Food Standards
    C. Advance Notices of Proposed Rulemaking
    D. Comments to the ANPRMs
    E. Options in the Food Standards Modernization Process
    F. Consumer Research
II. The Proposed General Principles
III. FSIS and FDA Requests for Information
IV. Executive Order 12866: Cost Benefit Analysis
    A. Need for the Rule
    B. Regulatory Options
V. Regulatory Flexibility Analysis
VI. Executive Order 12988: Civil Justice Reform
VII. Executive Order 13132: Federalism
VIII. Environmental Impact
IX. Paperwork Reduction Act of 1995
X. Additional Public Notification
XI. Comments
XII. References

I. Background

    FSIS and FDA share responsibility for ensuring that food labels are 
truthful and not misleading. FSIS has the authority to regulate the 
labeling of meat and poultry products, and FDA has the authority to 
regulate the labeling of all other foods. Some foods, such as eggs, are 
regulated by both agencies. Food standards are used to ensure that 
products sold under particular names have the characteristics expected 
by consumers.

A. FSIS Food Standards

    Meat and poultry product standards of identity or composition are 
codified in title 9 of the Code of Federal Regulations (CFR). FSIS has 
established by regulation approximately 80 meat and poultry product 
standards of identity or composition (9 CFR parts 319 and 381, subpart 
P, for meat and poultry products, respectively) under its authorities 
in the Federal Meat Inspection Act (FMIA) and the Poultry Products 
Inspection Act (PPIA) (21 U.S.C. 607(c) and 457(b)). These sections 
provide:
    The Secretary [of Agriculture], whenever he determines such 
action is necessary for the protection of the public, may prescribe 
* * * definitions and standards of identity or composition for 
articles subject to [the FMIA and PPIA] and standards of fill of 
container for such articles not inconsistent with any such standards 
established under the Federal Food, Drug, and Cosmetic Act [act] (21 
U.S.C. 301 et seq. ) and there shall be consultation between the 
Secretary [of Agriculture] and the Secretary of Health and Human 
Services prior to the issuance of such standards under [the FMIA, 
PPIA, or act] relating to articles subject to this chapter to avoid 
inconsistency in such standards and possible impairment of the 
coordinated effective administration of [the FMIA, PPIA and the 
act]. There shall also be consultation between the Secretary [of 
Agriculture] and an appropriate advisory committee provided for in 
[21 U.S.C. 454 and 661] prior to the issuance of such standards * * 
* to avoid, insofar as feasible, inconsistency between Federal and 
State standards.
    Consistent with the statutes, FSIS has consulted with FDA regarding 
the proposed general principles. In addition, FSIS consulted with the 
National Advisory Committee on Meat and Poultry Inspection about this 
proposed rule in November 2001, and incorporated their comments in this 
document. FSIS's food standards regulations cover many different foods. 
The contents of individual food standards or groups of food standards 
are extremely varied, depending on the complexity of the food and the 
level of detail necessary to define the characterizing features of the 
food. Some food standards are relatively simple, consisting of only a 
sentence or two (e.g., beef stew, 9 CFR 319.304), or a paragraph or two 
(e.g., deviled ham, 9 CFR 319.760). Other food standards are extremely 
detailed and prescriptive. For example, the standard for frankfurter, 
frank, furter, hotdog, weiner, vienna, bologna, garlic bologna, 
knockwurst and similar products describes the form of the product, the 
expected ingredients, and the allowable meat and nonmeat ingredients 
and poultry products that can be used in these products (9 CFR 
319.180). There are more standards for meat products than for poultry 
products because processed meat products have been in existence longer 
and have been consumed more widely than processed poultry products. 
Although the FMIA and PPIA authorized standards of fill, FSIS has not 
established any standards of fill in regulations.
    FSIS standards of identity generally require the presence of 
certain expected ingredients in a food product or mandate how a product 
is to be formulated or prepared. For example, a poultry product labeled 
``(kind) a la Kiev'' is required to be stuffed with butter, which may 
be seasoned (9 CFR 381.161). In the poultry products inspection 
regulations, the term ``kind'' refers to the type of poultry used. In 
this standard of identity, butter is an expected ingredient, and the 
standard also requires that the product be prepared by stuffing the 
butter in the poultry. The standard of identity for barbecued meats 
requires that barbecued meats be cooked by the direct action of dry 
heat resulting from the burning of hard wood or the hot coals therefrom 
for a sufficient period to assume the usual characteristics of a 
barbecued article, which include the formation of a brown crust on the 
surface and the rendering of surface fat (9 CFR 319.80). This standard 
of identity specifies exactly how the product must be prepared and also 
includes a description of the defining characteristics of products that 
meet the standard.
    Standards of composition specify the minimum or maximum amount of 
ingredients in a product. Many of these standards for meat products 
establish a minimum amount of meat or a maximum amount of fat in the 
product. For example, the standards of composition for ground beef, 
chopped beef, hamburger, and fabricated steaks require that the product 
contain no more than 30 percent fat (9 CFR 319.15). Several of the 
poultry standards of composition specify minimum poultry levels and 
maximum added liquid levels. For example, canned boned poultry, 
labeled, ``boned (kind)'' must

[[Page 29216]]

contain at least 90 percent cooked, deboned poultry meat of the kind 
indicated on the label, with skin, fat and seasoning, and may contain 
no more than 10 percent added liquid (9 CFR 381.157). The standards of 
composition for mechanically separated (species) (9 CFR 319.5) and 
mechanically separated (kind) (9 CFR 381.173) limit the amount and size 
of bone particles that the product may contain.
    Some FSIS standards require that product be labeled with a specific 
name, such as ``hamburger'' (9 CFR 319.15(b)) or ``(kind) patties'' (9 
CFR 381.160), while other standards provide examples of terms that can 
be used to label the products but do not prescribe the exact terms or 
phrases that must be used to label the product. For example, numerous 
phrases may be used in labeling fabricated steaks, including ``beef 
steak, chopped, shaped, frozen,'' ``minute steak, formed, wafer sliced, 
frozen,'' or ``veal steaks, beef added, choppedmolded- cubed-frozen, 
hydrolyzed plant protein, and flavoring'' (9 CFR 319.15(d)). Fabricated 
steaks also may be labeled with other terms not specified in the 
regulations.
    In addition, some FSIS standards require specific label 
information. For example, Italian sausage products that are cooked must 
be labeled with the word ``cooked'' in the product name (9 CFR 
319.145(c)), and cooked sausages, such as frankfurters, franks, 
furters, or hotdogs, that are prepared with meat from a single species 
of cattle, sheep, swine, or goats must be labeled with the term 
designating the particular species in conjunction with the generic name 
of the sausage (9 CFR 319.180(c)). The standard for poultry rolls 
requires that when binding agents are added in excess of 3 percent for 
cooked rolls and 2 percent for raw rolls, the common name of the agent 
or the term ``binders added'' must be included in the name of the 
product (9 CFR 381.159(a)).
    Under FSIS's food standards regulations, products that do not 
conform to a standard may not represent themselves as the standardized 
food. However, such products still may be sold under another name. For 
example, a beef stew that contains less than 25 percent beef can be 
marketed as ``gravy, vegetables, and beef'' or ``chunky beef soup,'' 
but can not be identified as ``beef stew'' because the food standard 
for meat stew requires that the product contain not less than 25 
percent of meat of the species named on the label (9 CFR 319.304). A 
product that does not meet the sausage standard (9 CFR 319.140) because 
it contains more than 10 percent of added water in the finished product 
may be marketed under another name, such as ``pork, water, and soy 
protein concentrate link.''
    Finally, in addition to its food standards regulations, FSIS has 
established numerous informal or ``policy'' food standards for meat and 
poultry products in the FSIS ``Food Standards and Labeling Policy 
Book'' (Policy Book).

B. FDA Food Standards

    FDA has established over 280 food standards of identity, some of 
which include standards of quality and fill of container, under the 
authority set forth in section 401 of the Federal Food, Drug, and 
Cosmetic Act (the act) (21 U.S.C. 341). This section provides in part:
    Whenever in the judgment of the Secretary [of Health and Human 
Services] such action will promote honesty and fair dealing in the 
interest of consumers, he shall promulgate regulations fixing and 
establishing for any food, under its common or usual name so far as 
practicable, a reasonable definition and standard of identity, a 
reasonable standard of quality, or reasonable standards of fill of 
container.
    The standards of identity, quality, and fill of container for foods 
regulated by FDA are codified in title 21, parts 130 to 169 (21 CFR 130 
to 169). FDA food standards establish the common or usual name for a 
food and define the nature of the food, generally in terms of the types 
of ingredients that it must contain (i.e., mandatory ingredients), and 
that it may contain (i.e., optional ingredients). FDA food standards 
may specify minimum levels of the valuable constituents and maximum 
levels for fillers and water. They also may describe the manufacturing 
process when that process has a bearing on the identity of the finished 
food. Finally, FDA food standards provide for label declaration of 
ingredients used in the food and may require other specific labeling, 
such as the declaration of the form of the food, packing medium, and 
flavorings or other characterizing ingredients, as part of the name of 
the food or elsewhere on the principal display panel of the label.
    Individual FDA food standards vary widely in their content. These 
variations have developed because of the different aspects of food 
technology that are responsible for providing the defining 
characteristics of a food. Some foods are defined and distinguished by 
their ingredients. The standards for these foods set specific limits on 
the levels of ingredients that must be used. For example, the standard 
of identity for fruit preserves and jams (Sec.  150.160 (21 CFR 
150.160)) lists the minimum amount of fruit and sugar that these foods 
must contain. Other food standards focus on compositional 
characteristics of the food, rather than on the specific ingredients. 
For example, the standards of identity for milk products (part 131) 
list the minimum levels of milkfat and milk solids (excluding fat) that 
must be contained in these foods. Still other foods owe their 
distinctive characteristics to the manner in which they are produced, 
and the standards for these foods reflect this fact. For example, the 
standards of identity for cheese products (part 133) specify the 
manufacturing process, in addition to compositional characteristics, to 
distinguish one cheese from another. Some other foods are defined by 
their physical characteristics. For example, particle size is an 
important factor in distinguishing cracked wheat from crushed wheat, 
and the standards of identity for these foods (Sec.  137.190 and 
137.195, respectively) include methods of analysis for the 
determination of the particle size of these foods. Depending on the 
level of detail necessary to define the characteristics of the food, 
some food standards of identity consist of only a few paragraphs (e.g., 
sap sago cheese in Sec.  133.186), while others are longer. For 
example, the canned tuna standard (Sec.  161.190) covers approximately 
eight pages in the CFR and prescribes the vegetables that must be used 
if the tuna is seasoned with vegetable broth.
    FDA's food standards of quality set minimum specifications for such 
factors as tenderness, color, and freedom from defects for canned 
fruits and vegetables. Such characteristics would not be readily 
apparent to the purchaser of these foods because of the nature of the 
foods and the manner in which they are presented to the consumer 
(inside a can). FDA food standards of fill of container set out 
requirements as to how much food must be in a container. These 
requirements are particularly important when foods are packed in 
liquids and sealed in opaque containers.
    In a manner similar to the FSIS food standard regulations, FDA's 
food standard regulations do not permit products that do not conform to 
a standard to be represented as the standardized food; such products, 
however, may be sold under other nonstandardized names. For example, a 
fruit product that does not meet the standard of identity for fruit 
preserves and jams (Sec.  150.160), because its fruit content is lower 
than the standard requires, may be marketed under another name, such as 
``fruit topping.''

[[Page 29217]]

C. Advance Notices of Proposed Rulemaking

    In 1995, FSIS and FDA began reviewing our regulatory procedures and 
requirements for food standards to determine whether food standards 
were still needed, and if so, whether they should be modified or 
streamlined. To initiate this review, we published advance notices of 
proposed rulemaking (ANPRMs) on food standards (60 FR 67492, December 
29, 1995 (FDA), and 61 FR 47453, September 9, 1996 (FSIS)). These 
ANPRMs discussed regulations and policy governing food standards, the 
history of food standards, and the possible need to revise the food 
standards.
    In the ANPRMs, we identified problems with existing food standards. 
Specifically, we stated that some food standards might impede 
technological innovation in the food industry. FSIS stated that the 
existing food standards also may prevent the food industry from 
producing products that have lower amounts of constituents associated 
with negative health implications, such as fat, saturated fat, 
cholesterol, and sodium (61 FR 47453). FDA stated that manufacturers of 
nonstandardized foods are developing new ingredients and plant 
varieties to enhance a food's organoleptic or functional properties, 
alter its nutritional profile, or extend shelf life. Incorporation of 
these advances into standardized foods may be difficult without the 
laborious amendment of the relevant standard (60 FR 67492).
    In the ANPRMs, FDA and FSIS presented alternatives to the existing 
food standards. The alternatives presented by FSIS included permitting 
the use of a lesser amount of meat or poultry in standardized products 
provided the product's label contained a declaration of the percentage 
of the meat or poultry content in the product; establishing a general 
standard of identity for standardized products that would provide for 
deviations from current ingredient allowances and restrictions 
(deviations would be highlighted in the ingredient statement on the 
product label); establishing categories of meat or poultry products and 
corresponding recommendations for expected meat and poultry contents; 
amending the statutes to allow private organizations to certify that 
food products meet consumer expectations; and revoking existing food 
standards and regulating all foods as nonstandardized foods (61 FR 
47453).
    The alternatives presented by FDA included revoking existing food 
standards and regulating all foods as nonstandardized foods; requiring 
that products declare the percentage of all major ingredients on the 
label; requiring that products declare the percentage of characterizing 
ingredients in the food name; identifying ``parent'' products with 
minimum compositional requirements (for example, creating a standard 
for jam or jelly that specifies minimum fruit content requirements) to 
avoid misleading use of percentage declaration on the food label; 
establishing generic food standards (such as the standards of identity 
for hard cheeses (Sec.  133.150) and spiced, flavored standardized 
cheeses (Sec.  133.193)); amending the statute to allow private 
organizations to certify that food products meet consumer expectations; 
and requiring appropriate labeling of foods that deviate from 
government quality standards (60 FR 67492).
    In the ANPRMs, the agencies asked for comments on the benefits or 
lack of benefits of the food standards regulations in facilitating 
domestic and international commerce and on the benefits of the food 
standards regulations to consumers. We asked how the food standards 
could be revised to grant the flexibility necessary for timely 
development and marketing of products that meet consumer needs, while 
at the same time providing consumer protection. We also asked for 
comments on the alternatives to the food standards presented in the 
ANPRMs and whether to coordinate efforts to revise the food standards 
regulations.

D. Comments to the ANPRMs

    FSIS received 28 letters, each containing one or more comments, 
from industry, consumers, a consumer group, and the U.S. Department of 
Agriculture (USDA) Food and Consumer Service (FCS) (now known as Food, 
Nutrition, and Consumer Services) in response to its ANPRM. FDA 
received 95 letters, each containing 1 or more comments, from industry, 
consumers, consumer groups, and the USDA FCS in response to its ANPRM. 
Most comments to both ANPRMs strongly supported the concept of food 
standards, while a few requested that standards be eliminated. However, 
very few comments to both ANPRMs supported the existing food standards 
as currently written. The types of concerns expressed in the comments 
to the ANPRMs follow.
    Many of the comments that supported retaining food standards stated 
that they protect consumers from fraudulent and substandard products by 
establishing the basis upon which similar products are formulated. 
Others argued that food standards ensure that products meet consumers' 
nutritional expectations and needs. Several comments from industry, a 
consumer, and two consumer groups stated that nutrition labeling and 
ingredient declarations cannot substitute for food standards, as 
reliance on nutrition labeling and ingredient declarations would be a 
burden to consumers.
    Several industry comments that supported food standards also stated 
that the Federal food standards ensure a level playing field for 
industry because they provide direction to industry members producing 
standardized products. Several industry comments and one comment from 
the USDA FCS also stated that, in the absence of Federal food 
standards, the States would be able to establish their own food 
standards and manufacturers would be confronted with the challenge of 
meeting different States' requirements. In addition, many industry 
comments stated that the food standards provide a basis for 
negotiations related to the international harmonization of standards 
and facilitate international trade. One comment stated that, without a 
U.S. food standards system, food standards development could shift to 
international bodies, which may not be sensitive to the American 
consumer or industry. Another comment stated that the absence of food 
standards could pose a barrier to exports and international markets.
    Although most comments supported retaining food standards in some 
form, they requested that food standards be simplified, be made more 
flexible, or be clarified. For example, one industry comment stated 
that food standards should not include manufacturing methods, 
prohibitions regarding classes of ingredients, or product-specific 
labeling (other than the acceptable product name). This comment also 
stated that standardized and nonstandardized food product labeling 
should be the same. Similarly, other industry comments requested that 
the food standards be made more flexible to allow for alternative safe 
and suitable ingredients and alternative technologies that do not 
change the basic nature or basic characteristics of the food. Several 
industry comments recommended limiting food standards to the name of 
the product and the essential characterizing properties of the product. 
Several industry comments to FSIS's ANPRM recommended that food 
standards be limited to meat and poultry content requirements. 
Conversely, other industry comments to FSIS's ANPRM recommended that

[[Page 29218]]

industry be given the flexibility to reduce the percentage of meat in 
standardized products.
    Several industry comments and a consumer comment to FDA's ANPRM 
recommended that FDA revise certain specific food standards (e.g., 
jams, jellies, preserves, milk chocolate, and sweetened condensed milk) 
to provide more flexibility in food technology and ingredient options.
    In response to FSIS's and FDA's requests for suggestions as to how 
they should revise food standards, several comments from industry and 
from a consumer group recommended rescinding or modifying them on a 
case-by-case basis. Some comments from industry recommended instituting 
advisory committees, contracting with independent groups, or forming 
nongovernment groups to revise the food standards. Further, several 
industry comments recommended establishing general or ``guiding'' 
principles or a fundamental philosophy for reviewing food standards and 
revising them. Other industry comments and a consumer group suggested 
that revisions to standards should be initiated by petitions and 
supported by adequate data. Finally, several comments to both ANPRMs 
stated that FSIS and FDA food standards should be consistent, and that 
we should attempt to harmonize our efforts to revise the food 
standards.
    Comments to FSIS's alternatives: Few comments supported the 
alternatives to food standards that FSIS presented in its ANPRM. A 
consumer organization was opposed to all of the alternatives presented 
in the ANPRM. Several trade groups specifically stated their opposition 
to percentage labeling. One of these groups stated that products would 
be cheapened if this alternative were allowed. The USDA FCS comment 
stated that percentage labeling had merit, but that this alternative 
does not address all the factors that might make a product inferior in 
quality. The USDA FCS comment-and several industry comments that 
generally opposed the other alternatives presented in the ANPRM-
expressed support for the general standard alternative that would 
provide for deviations from current ingredient allowances and 
restrictions. These comments stated that this approach would allow 
consumers to discern differences between the standardized product and 
the modified version. One of these comments stated that this approach 
may not allow enough ingredient deviations in standardized products. 
Another of these comments stated that a general standard's approach 
should expressly permit reduction of meat and poultry content in 
standardized products. Many of the industry comments opposed private 
certification that food products meet consumer expectations.
    Comments to FDA's alternatives: Several comments opposed the 
alternatives presented in FDA's ANPRM. One trade association stated 
that percentage labeling was not an adequate substitute for standards. 
One industry comment stated that percentage labeling might be 
acceptable if it provided for the marketing of ``heavily breaded 
shrimp'' without requiring ``imitation'' labeling but that any other 
use of percentage labeling would be too cumbersome and could give away 
proprietary information. The USDA FCS comment stated that percentage 
labeling has merit but does not address all of the factors that could 
make a product inferior in quality. Another alternative that was 
presented in conjunction with percentage characterizing ingredient 
labeling was to identify a ``parent'' product, for example, a 
standardized jam or jelly that complies with minimum compositional 
requirements, to avoid misleading use of the percentage declaration on 
a food label. In response, one industry comment stated that this 
approach might be useful, but would not be adequate to replace all 
standards. Another industry comment stated that minimal compositional 
standards are necessary to provide a benchmark to ensure product 
integrity and to satisfy consumer expectations. Comments also opposed 
the alternative of extending the generic food standard concept (such as 
the existing standard of identity for hard cheeses (Sec.  133.150) or 
the generic standard for nutritionally modified versions of traditional 
standardized foods in Sec.  130.10 (21 CFR 130.10)) to other classes of 
food standards. Two industry comments stated that generic food 
standards should not be used to create standards for nonstandardized 
foods, while another industry comment stated that the current generic 
standards in Sec.  130.10 were adequate. On the other hand, an industry 
comment stated that generic standards in addition to those covered in 
Sec.  130.10 could be beneficial to maintain product characteristics. 
Similarly, the USDA FCS stated that the generic standards approach has 
merit. With regard to the alternative of requiring that foods that 
deviate from government quality standards be labeled appropriately, one 
comment stated that foods that deviate from standards should be named 
so that they are readily distinguishable from the standardized food. 
Another comment stated that current labeling requirements provide 
sufficient information concerning deviation from standards. While two 
industry comments supported private certification of foods that meet 
consumer expectations, most comments opposed this alternative.

E. Options in the Food Standards Modernization Process

    As noted previously, several comments recommended that FDA and FSIS 
establish general principles or a fundamental philosophy for reviewing 
food standards and revising them. The agencies agree with these 
comments supporting the development of general principles for reviewing 
and revising food standards regulations and also agree with the 
comments that stated that the agencies should work in concert to 
develop consistent food standards regulations.
    On September 12, 1996, FDA convened an internal agency task force 
to discuss the current and future role of food standards and to draft a 
set of principles for reviewing and revising FDA's food standards 
regulations. The task force agreed that the food standards should 
protect consumers without unduly inhibiting technological advances in 
food production and marketing.
    To ensure that FSIS and FDA were consistent as the food standards 
reform process continued, in January 1997, a joint FDA and FSIS Food 
Standards Work Group (the Work Group) was convened, chaired by the 
Director of the FDA's former Office of Food Labeling (now incorporated 
into the Office of Nutritional Products, Labeling, and Dietary 
Supplements) and the Director of the FSIS Labeling and Compounds Review 
Division (now the Labeling and Consumer Protection Staff). The Work 
Group revised the principles that the FDA task force had developed to 
reflect the goals and needs of both agencies.
    In addition to developing these general principles, the Work Group 
considered five options, as the next step in the process of food 
standards reform, and analyzed the advantages and disadvantages of each 
option. The first option the Work Group considered was not proceeding 
any further with the review of the food standards regulations. The 
advantage of this option is that, in the short run, it would require 
little or no increase in the agencies' use of resources.
    A major disadvantage of this option is that there is very little 
industry or consumer support for it. As noted previously, the majority 
of comments supported revising the existing system of food standards to 
simplify them and

[[Page 29219]]

to make them more flexible. In addition, even if this first option were 
adopted, we would need to continue to expend resources interpreting and 
enforcing food standards that may be outdated. Additionally, a system 
of food standards that does not allow technological advancement in food 
production may not be in the long-term interest of consumers. If we do 
not revise the food standards, FDA would need to continue to devote 
resources to temporary marketing permit (TMP) applications, which allow 
companies to sell products that deviate from established food standards 
while testing the marketplace for consumer acceptance of the new 
product (Sec.  130.17), and both agencies would need to devote 
resources to keeping their respective standards systems functioning. In 
the long run, demands on each agency's resources would likely increase 
as technological and marketing advances conflict with the requirements 
in the existing food standards regulations. However, if food standards 
were revised to provide flexibility in manufacturing, the number of TMP 
applications would be reduced and agencies' resources conserved. 
Finally, not reviewing or revising food standards to ensure that they 
are current with international food standards, as appropriate, could 
create difficulties in international negotiations and trade.
    The second option the Work Group considered was removing all food 
standards from the regulations and treating all foods as 
nonstandardized foods. One advantage of this option is that, in most 
cases, fewer agency resources would be required to eliminate food 
standards than to review and revise them. Also, under this option, we 
no longer would devote resources to responding to petitions requesting 
an amendment to an existing standard or the establishment of a new food 
standard.
    As with the first option, however, very few comments on the ANPRMs 
supported eliminating food standards completely. We agree with the 
comments that stated that States might establish their own food 
standards in the absence of Federal food standards. For meat and 
poultry products, if there were no Federal standards, States with their 
own meat and poultry inspection programs could have State standards for 
meat and poultry products and these would only apply to products 
produced at establishments within the State that are distributed within 
the State. Such food standards for meat and poultry products could 
differ from State to State. For FDA-regulated food products, if there 
were no Federal food standards, States would be free to create their 
own standards which might differ from each other, making compliance by 
manufacturers more difficult. Without Federal food standards, there 
would be no reference point for ensuring consistency of products for 
national commodity programs or feeding programs, such as the National 
School Lunch Program. In addition, as comments stated, without Federal 
food standards, the United States would have no reference point for 
negotiating international food standards, or facilitating international 
trade.
    Another disadvantage of this option is the loss of enforcement 
efficiency. Without food standards, we would have to rely solely on the 
general adulteration and misbranding provisions of our statutes rather 
than upon the specified requirements of a food standard to determine if 
a product were economically adulterated (i.e., adulterated under Sec.  
402(b)(1)) or misbranded. This would likely require more enforcement 
resources than a food standards system would require.
    The third option the Work Group considered was using our resources 
to review and revise food standards to make them internally consistent, 
more flexible for manufacturers and consumers, and easier to 
administer. The majority of comments supported this option and several 
provided specific suggestions concerning regulatory revisions. If we 
were to revise the food standards, we would ensure that the revisions 
reduced the burden on industry and ensured adequate protection of 
consumers. The disadvantage of this option is competing priorities 
would make it unlikely we could do this in a timely manner.
    The fourth option the Work Group considered was to request external 
industry groups to review, revise, and administer the food standards 
(private certification). This option would require little or no use of 
the agencies' resources. In addition, the revised food standards would 
provide the level of flexibility that industry desires. However, for 
private organizations to review, revise, and administer the food 
standards, the act, FMIA, and PPIA would have to be amended, so that 
these standards would have the force of law.
    Although a few industry comments supported private certification of 
food standards, most comments to the ANPRMs opposed private 
certification. In addition, the Work Group determined that this option 
might not provide a mechanism for consumer input, unless required by 
legislation. Therefore, consumers' interests would not necessarily be 
reflected in the revised food standards, which might result in the 
standards failing to promote honesty and fair dealing in the interest 
of consumers or to protect the public. Also, food standards for which 
industry was unwilling to commit resources would not be revised. Under 
this option, there might be no mechanism for resolving conflict, should 
it arise, among industry segments, unless legislative changes provided 
such a mechanism. Furthermore, we determined that food standards 
established and maintained by industry would be voluntary, not 
mandatory, unless legislative changes authorized industry to establish 
and maintain the standards.
    The fifth option the Work Group considered was to rely on external 
groups-consumer, industry, commodity, or other groups-to draft 
recommended revisions to existing Federal food standards but retain the 
agencies' authority to establish the final food standards. Under this 
option, we would continue to codify the food standards in our 
respective regulations. The external groups would use the general 
principles put forward by us to draft new food standards and would 
submit these in petitions. Similarly, external groups would use the 
general principles to draft revised food standards or to propose 
eliminating existing food standards. We would review any petitions 
submitted to ensure that they were consistent with the general 
principles. Under this option, if we determined that a petition to 
establish, revise, or eliminate a standard was consistent with the 
general principles, and provided adequate data and support for the 
suggested change, we would more quickly propose and, when appropriate, 
finalize a new or revised and simplified standard or the elimination of 
a standard.
    One major advantage of this option is that it would require the use 
of fewer of our agencies' resources than would be required if we were 
to review and propose amendments to the food standards without the 
benefit of petitions. In addition, this option allows for the 
participation of consumer groups and an opportunity for them to express 
interest through the petition process and through the submission of 
comments in response to proposed rules on new or revised food 
standards. Because we would have ultimate authority and jurisdiction 
over the final food standard established or eliminated, we would ensure 
that consumer interests were protected. Another advantage of this 
option is that it would rely largely on information from those groups 
that have the most interest in, and knowledge of, the particular food 
standards being

[[Page 29220]]

considered for revision. These groups could draw on technical experts 
with knowledge of current production practices and marketing trends who 
could suggest which aspects of a specific standard are necessary to 
define the essential characteristics of a particular food. This 
approach would also likely result in consistent food standards because 
the general principles would govern all changes that are made to the 
standards.
    The disadvantage to this fifth option is that, if a consumer, 
industry, or commodity group does not feel strongly about revising a 
particular group of food standards, we might not receive a petition and 
would then need to commit resources to reviewing the food standards 
without the benefit of a petition. However, comments to the ANPRMs and 
informal communications with external groups following publication of 
the ANPRMs indicate the willingness of consumer, industry, and 
commodity groups to submit for our consideration complete and thorough 
revisions for many food standards. In the event we do not receive a 
petition requesting that we revise, revoke, or establish a food 
standard, we, on our own initiative, may, when appropriate, propose to 
revise, revoke, or establish a standard.
    For the reasons discussed previously, we have tentatively 
determined that the fifth option is the most appropriate course of 
action. The Work Group preliminarily determined that we could rely on 
external groups to suggest new food standards, revisions to existing 
food standards, or elimination of certain food standards that are 
consistent with the proposed general principles. The general principles 
approach would allow us to chart the basic course of food standards 
review and modernization. Moreover, it would allow consumer and 
industry groups to participate in the development of new and revised 
food standards and to identify food standards that should be 
eliminated. In addition, it would provide an opportunity for consumer 
and industry groups to submit data to support any claims made in 
petitions relating to consumer expectations or beliefs, and hence, 
protect consumer interests.

F. Consumer Research

    To gain a preliminary understanding of current consumer attitudes 
toward Federal food standards of identity and the usefulness of food 
standards to consumers, we funded a series of focus group discussions 
(FGDs) that were conducted by the Research Triangle Institute, North 
Carolina. A total of 64 household grocery shoppers were recruited to 
participate in 8 FGDs held, 2 each in 4 cities: Raleigh, NC; San Diego, 
CA; Philadelphia, PA; and St. Louis, MO. Male and female participants 
were selected to represent diversity in age, level of education, and 
race. The purpose of this research was to collect the following 
information on consumers: (1) Attitudes toward arguments for and 
against standards of identity regulations; (2) preferences for 
standards of identity regulations for different types of food products; 
(3) preferences for various types of requirements in standards of 
identity regulations; (4) preferences for possible alternatives to 
standards of identity regulations; and (5) attitudes towards the 
standards setting process and suggestions for improving it.
    The FGDs revealed that the opinion of participants on standards of 
identity varied widely ranging from those who felt that such standards 
are always necessary to those who felt that such standards are never 
necessary. However, the FGDs did not generate sufficient data to 
explain the basis for these differences. The majority of participants 
at these FGDs supported the need for food standards to ensure product 
quality and protect consumers, and opined that food standards should 
not be eliminated. Some participants stated that standards were 
necessary to ensure that products are named and labeled appropriately, 
and that food standards would allow consumers to base purchase 
decisions simply on the name of the product. Some participants also 
stated that standards should be based on consumers' beliefs about 
minimum acceptable levels of product characteristics and were concerned 
that a lack of standards would lead to increased shopping time and 
costs associated with trying different brands of a particular food to 
find one that meets their expectations. A majority of participants also 
indicated that food standards help ensure a certain degree of product 
uniformity.
    However, some participants did not support the use of food 
standards. A few participants in the FGDs questioned the need for 
standards. With respect to quality provisions in standards, some 
participants stated that they prefer variety over a set standard 
quality of a food product; they also felt that some consumers might 
value the ability to choose a product of lower quality at a reduced 
price. These participants believed that standards were not necessary 
because consumer expectations of essential product characteristics and 
product quality can vary, and normal market forces, including the 
ability of a product to meet consumers' expectations, will determine 
whether it stays on the market. Therefore, they maintained that 
government oversight over product quality and uniformity was not 
needed. Some of these participants asserted that food standards do not 
serve consumers because they do not reflect the diversity of consumer 
expectations and beliefs, and restrict product choice and innovation.
    In addition to being asked whether they support or oppose the need 
for food standards, participants were asked which food products or 
characteristics of food products it was most important to standardize 
and monitor. In response, participants stated that they considered food 
standards to be most necessary for foods with multiple, unrecognizable 
ingredients (e.g., cheeses or hot dogs) and least necessary for foods 
with a single, recognizable ingredient (e.g., milk or canned corn). 
Many participants identified requirements for the types and amounts of 
ingredients and the quality of a product as the most important ones of 
a food standard, while the physical characteristics of a food were 
stated as least important.
    Additionally, several participants suggested that we review food 
standards periodically and revise them as needed on a case-by-case 
basis to accommodate changes in consumer preferences and reflect 
advances in processing and ingredient technologies. Finally, 
participants expressed the need for FSIS and FDA to obtain input from 
consumers during the process of establishing and revising food 
standards so consumers' preferences and beliefs are accurately 
reflected in food standards (Refs. 1 and 2).
    Overall, although the opinion of participants on standards of 
identity varied widely, some tentative conclusions can be drawn. Many 
participants found standards of identity to be valuable. Participants 
stated that having uniform product names for products with certain 
defined characteristics makes shopping easier. Many participants also 
felt that standards of identity help ensure a product has its expected 
characteristics. Most participants did not agree that standards hinder 
the variety of products available on the market. In general, 
participants felt that it was more important for standards to address 
characteristics that participants could not readily observe (such as 
ingredients in products with multiple, unrecognizable ingredients) 
rather than characteristics they could observe (such as appearance, 
size, or number). Participants also stated that standards of

[[Page 29221]]

identity should be based on consumer beliefs and expectations about the 
product that are implied by a product's name and its minimum acceptable 
characteristics. In addition, participants believed that standards 
should be periodically revised to accommodate changes in consumer 
beliefs and technological advances. Most participants also expressed 
the desire for consumers to play a role in the development or revision 
of standards and did not feel that the government should rely solely on 
input from industry. Although tentative, and drawn from the limited 
focus group research data that is available, these conclusions provide 
support for the general principles discussed in section II of this 
document.

II. The Proposed General Principles

    We are proposing general principles for establishing new food 
standards and for revising or eliminating existing food standards. In 
the list of proposed general principles for both of our agencies, the 
first four state the purpose or function of a food standard, and the 
remaining principles state how the requirements of a food standard 
should be written and what should be incorporated, in general, in the 
standard. Although the general principles have been developed to be 
consistent between our two agencies, they are not identical. Because 
FSIS and FDA regulate different products, principles that are specific 
to a particular agency were developed to reflect that agency's 
regulatory needs and perspectives.
    FSIS is proposing to establish 9 CFR 410.1(a) and FDA is proposing 
to amend 21 CFR 130.5(b) to include these new general principles. Under 
this proposed rule, the agencies will deny a petition to establish a 
food standard if the proposed food standard is not consistent with all 
of the general principles that apply to the proposed standard. The 
agencies recognize that not all of the general principles will be 
applicable to every food standard. The agencies will deny a petition to 
revise an existing standard if the proposed revision is inconsistent 
with any of the general principles that apply to the proposed revision. 
Under this proposed rule, when proposing a revision to a standard, 
petitioners will not be required to propose all the revisions that 
might be needed to modernize the entire existing standard. Rather, the 
petitioner may propose only limited changes to existing standards, 
provided the proposed revisions are consistent with the general 
principles that apply to them.
    The first four general principles state the purpose or function of 
a food standard. These principles are the most fundamental principles 
addressing consumer protection from an economic standpoint. Therefore, 
the agencies are proposing to deny a petition to eliminate a food 
standard if the petition does not demonstrate how the standard proposed 
to be eliminated is inconsistent with any one of the first four general 
principles. As stated in section I.B of this document, the act 
explicitly states that regulations establishing food standards of 
identity shall be issued when such action will ``promote honesty and 
fair dealing in the interest of consumers'' (21 U.S.C. 341). In 
addition, as stated in section I.A of this document, the FMIA and PPIA 
require that standards of identity or composition established under 
these acts be consistent with standards of identity, quality, or fill 
of container established under the act. Also, as stated previously, the 
FMIA and PPIA authorize the Secretary of Agriculture, after 
consultation with the Secretary of Health and Human Services, to 
prescribe definitions and standards of identity or composition for meat 
and poultry products whenever he or she determines that such action is 
necessary for the protection of the public. Therefore, all of the 
general principles set forth in this proposal have been designed to 
achieve the goals of promoting honesty and fair dealing in the interest 
of consumers and protecting the public. This is further explained as 
each individual or group of general principles is discussed below. 
Consistent with section 401 of the act, section 457(b) of the PPIA, and 
section 607(c) of the FMIA, the first four proposed general principles 
primarily address consumer protection from an economic standpoint. 
These first four principles are consistent with the findings of the 
focus group studies where a majority of participants maintained that 
food standards are needed to ensure product quality and uniformity and 
to protect consumers from economic deception. The first general 
principle listed under proposed 9 CFR 410.1(a)(1) and 21 CFR 
130.5(b)(1) makes it explicit that FSIS' purpose for a food standard is 
to protect the public and FDA's is to promote honesty and fair dealing 
in the interest of consumers. Food standards would provide a system by 
which consumer interests are protected and consumer expectations of a 
food are met. Historically, food standards have been beneficial because 
they provide assurance to consumers of product uniformity with respect 
to certain significant characteristics of standardized foods, resulting 
in the expectation and belief of consumers that all products bearing a 
particular name will possess the same essential characteristics, 
irrespective of where they are purchased, or by whom they are 
manufactured or distributed. Thus, to ensure that consumers are not 
misled by the name of the food, to meet consumers' expectations of 
product characteristics and uniformity, and, in turn, to promote 
honesty and fair dealing in the interest of consumers and to protect 
the public, a food standard should, as stated in proposed 9 CFR 
410.1(a)(2) and 21 CFR 130.5(b)(2), describe the basic nature of the 
food. The basic nature of the food is directly related to consumer 
expectations and beliefs about the food.
    Also, to promote honesty and fair dealing in the interest of 
consumers and to protect the public, proposed 9 CFR 410.1(a)(3) and 21 
CFR 130.5(b)(3) would state that the food standard should reflect the 
essential characteristics of the food. While the basic nature of a food 
is directly related to consumer expectations and beliefs about the 
food, the essential characteristics are the attributes of a food that 
make the food what it is even though they may not be readily apparent 
to the consumer. The essential characteristics of a food are those that 
define or distinguish a food or describe the distinctive properties of 
a food. Further, the essential characteristics of a food may contribute 
to achieving the basic nature of the food or may reflect relevant 
consumer expectations of a food product. Foods may be defined or 
distinguished by their ingredients, compositional characteristics, 
physical characteristics, levels of certain nutrients, or the manner in 
which they are produced--all of which are the essential characteristics 
of a food. For example, the essential characteristics of a hotdog 
include a certain fat and moisture content, and the use of water or ice 
to form an emulsion, whereas the basic nature of a hotdog is that it is 
a comminuted, semisolid sausage prepared from one or more kinds of raw 
skeletal muscle meat and/or cooked poultry meat. Similarly, the 
essential characteristics of a particular type of cheese may include 
the bacterial culture used, the processing method, and the fat and 
moisture content that contribute to the unique characteristics of that 
cheese and the basic nature of that cheese is that it is a milk-derived 
food of a certain form and consistency. Likewise, the essential 
characteristics of wheat flour

[[Page 29222]]

include granulation requirements (the percentage of flour that has to 
pass through a certain sieve size), its moisture content, and its ash 
content, whereas the basic nature of wheat flour is that it is a ground 
product of cleaned wheat grain. Therefore, although the essential 
characteristics of a food may contribute to achieving the basic nature 
of that food or may be relevant to meeting certain consumer 
expectations about the food, they differ from the basic nature of the 
food in that consumers may not be aware of the essential 
characteristics that make the food what it is.
    Preserving the basic nature and essential characteristics of a food 
would promote honesty and fair dealing in the interest of consumers and 
protect the public by ensuring that consumer expectations of the 
economic and nutritional value of a food are met. Historically, food 
standards have been adopted to protect consumers of traditional foods 
from deceptive, inferior quality products of lesser economic value. 
Current food standards ensure the economic value of a food. For 
example, the standards of identity for cheeses (part 133) specify milk 
solids or milkfat content requirements to prevent the substitution of 
less valuable ingredients for more valuable ingredients.
    In addition to ensuring the economic value of a food, FDA food 
standards, on occasion, also may serve to ensure the nutritional 
quality of a food by imposing requirements in addition to the labeling 
requirements in part 101 (21 CFR part 101). For example, the 
requirements for mandatory addition of vitamin D to evaporated milk and 
of vitamin A to margarine are specified within the standards of 
identity for these foods (Sec. Sec.  131.130 and 166.110, 
respectively). These nutritional requirements are an integral part of 
the standards of identity of these two foods and are not regulated 
under FDA's other nutritional quality provisions, such as its nutrient 
content claims regulations (part 101). The use of food standards as 
vehicles to improve the nutritional quality of the food supply has 
always been based on documented public health need and substantiated 
with sound science to ensure that, within the context of the total 
diet, the food is suitable for its intended use with reasonable 
assurance of effectiveness and safety in achieving the nutritional 
goals. FDA will continue to apply this standard for any future use of 
standardized foods or any other food as a vehicle to improve the 
nutritional quality of the food supply.
    Numerous FSIS standards specify the minimum amounts of meat and 
poultry and maximum amounts of fat or other ingredients a product may 
contain. These provisions ensure both the economic value and 
nutritional quality of standard meat and poultry products.
    Therefore, proposed 9 CFR 410.1(a)(4) and 21 CFR 130.5(b)(4) state 
that the food standard should ensure that the food does not appear to 
be better or of a greater value than it is. Additionally, the food 
standard may be used as a vehicle to improve the overall nutritional 
quality of the food supply.
    In addition to protecting the consumer, the next three proposed 
general principles would promote clear and straightforward requirements 
for food manufacturers. They would also promote, to the extent 
feasible, flexibility in food technology.
    Regulatory requirements written in plain and simple language 
facilitate the manufacture of foods that comply with the regulations 
and, thereby, help reduce manufacturers' costs of compliance and 
government costs of enforcement. Lowered costs of producing foods that 
meet the standards may potentially benefit consumers in the form of 
lowered prices of products in the marketplace. Therefore, proposed 9 
CFR 410.1(a)(5) and 21 CFR 130.5(b)(5) state that the food standard 
should contain clear and easily understood requirements to facilitate 
compliance by food manufacturers.
    Establishing regulations that do not stifle innovations in food 
technology and allow for technological alternatives and advancements in 
food processing would improve manufacturing efficiency and lessen costs 
which may be passed on to the consumer. Improved technologies may 
additionally benefit product quality and diversity. Increased diversity 
in, and potentially lower costs of, food products in the marketplace 
that continue to meet consumer expectations would promote honesty and 
fair dealing in the interest of consumers and protect the public. 
Therefore, proposed 9 CFR 410.1(a)(6) and 21 CFR 130.5(b)(6) provide 
that the food standard should permit maximum flexibility in the food 
technology used to prepare the standardized food, so long as that 
technology does not alter the basic nature or essential 
characteristics, or adversely affect the nutritional quality, or safety 
of the food. In addition, these provisions would state that the food 
standard should provide for any suitable, alternative manufacturing 
process that accomplishes the desired effect and should describe 
ingredients as broadly and generically as feasible.
    We are proposing the provision concerning flexibility in food 
technology to ensure that any requirement of a standard accomplishes 
its purpose without impeding technological advances that are not in 
conflict with the intent of the requirement. For example, in FSIS's 
current regulations, the standard for barbecued meats requires that 
products such as ``beef barbecue'' or ``barbecued pork'' be cooked by 
the direct action of dry heat (9 CFR 319.80). However, there may be 
other cooking methods that result in the same product characteristics 
that the direct action of dry heat achieves, such as infrared heating. 
During FGDs, consumers expressed the need to revise food standards to 
reflect current advances in food manufacturing technology, and we 
believe that this general principle provides an avenue to keep food 
standards current with technological advances.
    In addition to addressing flexibility in food technology, proposed 
9 CFR 410.1(a)(6) and 21 CFR 130.5(b)(6) would also state that the food 
standard should provide for any suitable, alternative manufacturing 
process that accomplishes the desired effect and should describe 
ingredients as broadly and generically as possible. Examples of 
standards that would permit flexibility in manufacturing processes 
would be those that provided for any suitable procedure for removing 
glucose from dried eggs, for instantizing flours, or for low-
temperature rendering of meat. We proposed that any food standard that 
includes a specific manufacturing process should allow for alternative 
procedures. If the manufacturing process specified in a food standard 
is essential to the character of the food, the food standard should 
allow for the use of any alternative procedure that yields a product 
with the same physical, nutritional, and sensory characteristics as the 
food made according to the traditional procedure specified in existing 
food standards.
    To allow for flexibility in ingredients used to formulate 
standardized products, the ingredients for frozen raw breaded shrimp, 
for example, might be described to be ``batter and breading 
ingredients'' (Sec.  161.175) and those in frankfurters, frank, furter, 
hotdog, weiner, vienna, bologna, garlic bologna, knockwurst, and 
similar products might be described to be ``byproducts and variety 
meats'' (9 CFR 319.180). If it is necessary to specify ingredients, the 
standard should specify these ingredients by functional use category, 
e.g., ``stabilizers and thickeners'' or ``texturizers,'' rather than by 
listing specific ingredients. Also, where appropriate, in accordance 
with current

[[Page 29223]]

regulations, the specific levels of ingredients that can be used may be 
modified if they reflect safe and suitable levels or those levels that 
reflect good manufacturing practices.
    The general principles would also promote uniformity between 
Federal food standards and any international standards for the same 
food. With the rising trend in globalization and increased 
accessibility of U.S. goods to other nations' markets, efforts to 
harmonize U.S. food standards with international food standards will 
facilitate international trade and foster competition. These efforts 
may also result in lowered costs and the increased diversity of the 
food supply, which in turn would benefit consumers. Therefore, we are 
proposing harmonization of U.S. standards with international food 
standards to the extent feasible, while preserving the integrity, 
quality, and economic value that U.S. consumers expect of the food. 
Proposed 9 CFR 410.1(a)(7) and 21 CFR 130.5(b)(7) state that the food 
standard should be harmonized with international food standards to the 
extent feasible. If a food standard presented in a petition is 
different from the requirements in a Codex standard for the same food, 
we are proposing that the petition should specify the reasons for these 
differences. This principle is consistent with FDA's existing 
regulation, 21 CFR 130.6, which states that food standards adopted by 
the Codex Alimentarius Commission will be reviewed by FDA, and either 
will be accepted (with or without change) or will not be accepted. This 
regulation also states that petitioners who petition FDA for a new or 
amended food standard based on the relevant Codex food standard shall 
specify any deviations in the requested standard from those in the 
Codex standard and the reasons for any such deviations.
    The next six proposed general principles promote simplicity, 
brevity, and consistency in food standards. Providing regulatory 
requirements that are simply and concisely stated and are consistent 
among different foods would help improve efficiency and reduce the 
costs of compliance by industry, as well as reduce enforcement costs by 
regulatory agencies. Increased industry efficiency may also result in 
lowered costs of food products. Unnecessary details and requirements in 
a food standard not only burden enforcement and compliance efforts but 
also limit manufacturing options and create inefficiencies. Therefore, 
proposed 9 CFR 410.1(a)(8) and 21 CFR 130.5(b)(8) state that the food 
standard provisions should be simple, easy to use, and consistent among 
all food standards. This proposed principle also states that food 
standards should include only those elements that are necessary to 
define the basic nature and essential characteristics of a particular 
food, and that any unnecessary details should be eliminated. As noted 
in section I.B of this document, the existing FDA food standards vary 
widely in their content and level of detail. In this principle, we are 
proposing to make it clear that simplicity in, and consistency among, 
food standards is essential. This proposed principle makes it clear 
that any unnecessary details, such as details related to manufacturing 
processes, ingredients, or variations of different forms of the same 
food that are not necessary to define the basic nature and essential 
characteristics of a food, should be eliminated from the standards 
regulations. For example, in the FSIS food standards, the list of 
curing ingredients in the corned beef hash standard (9 CFR 
319.303(a)(3)) is an unnecessary detail because curing agents permitted 
in meat products are listed in 9 CFR chapter III, subchapter E or in 21 
CFR chapter I, subchapter A or B. Also, in addition to the standard for 
corned beef hash, the FSIS regulations contain a standard for hash (9 
CFR 319.302). It may not be necessary to have separate standards for 
different forms of hash. An example of unnecessary detail in FDA food 
standards may be the provision for nutritive carbohydrate sweeteners in 
the standard for ``yogurt'' (Sec.  131.200), ``lowfat yogurt'' (Sec.  
131.203), and ``nonfat yogurt'' (Sec.  131.206), which lists several 
sweeteners, because nutritive sweeteners have been defined in Sec.  
170.3(o)(21) (21 CFR 170.3(o)(21)). This provision could be 
incorporated by simply using the functional category ``nutritive 
carbohydrate sweeteners'' without listing the different sweeteners.
    This general principle is consistent with the findings of FGDs 
where participants expressed the belief that certain characteristics of 
a food, such as its type and amount of ingredients, are the more 
important elements of a food standard than certain other 
characteristics of a food.
    Proposed sections 9 CFR 410.1(a)(9) and 21 CFR 130.5(b)(9) state 
that the food standard should allow for variations in the physical 
attributes of the food. Also, this proposed principle states that where 
it is necessary to provide for specific variations in the physical 
attributes of a food within the food standard, the variations should be 
consolidated into a single food standard. Thus, this provision would 
promote simplification of food standards. For example, it is necessary 
to provide for specific variations of cereal flours (e.g., flour, 
bromated flour, instantized flour, and phosphated flour (21 CFR part 
137)). According to this proposed principle, the variations for these 
standards should be consolidated into a single food standard. 
Similarly, existing provisions in FSIS's food standards for different 
forms of ham (e.g., chopped, ground, flaked, chipped, and pressed for 
cured ham products (``ham patties,'' ``chopped ham,'' ``pressed ham,'' 
``spiced ham,'' and similar products (9 CFR 319.105) and ``deviled 
ham'' (9 CFR 319.760))) could be simplified or consolidated. In order 
to promote food standards that are simple and consistent, proposed 9 
CFR 410.1(a)(10) and 21 CFR 130.5(b)(10) state that, whenever possible, 
general requirements that pertain to multiple food standards of a 
commodity group should be incorporated into general regulatory 
provisions that address the commodity group. For example, enrichment 
requirements for cereal flours and related products might be codified 
in a new subpart A of part 137 entitled ``General Provisions.'' 
Further, the methods of analysis relevant to different foods within the 
same commodity group might be codified under the general provisions for 
that commodity group. Additionally, the curing requirements common to 
cured beef products could be codified in a new section at the beginning 
of 9 CFR part 319, subpart D. When provisions are of a general nature 
and affect more than one commodity group, we would consider codifying 
these requirements all together in an appropriate CFR section. For 
example, some fill of container requirements are codified in 21 CFR 
part 100, subpart F (``Misbranding for Reasons Other Than Labeling'') 
and apply to a wide array of products. Likewise, Sec.  130.10 
Requirements for foods named by use of a nutrient content claim and a 
standardized term permits the modification of a standardized food to 
achieve a nutrition goal, such as a reduction in fat or calories. Such 
modified foods may be named by the use of a nutrient content claim, 
such as ``reduced fat'' and a standardized term, such as ``cheddar 
cheese'' (i.e., reduced fat cheddar cheese). To further promote 
consistency among food standards, proposed 9 CFR 410.1(a)(11) states 
that any proposed new or revised food standard should take into account 
whether there are FSIS labeling regulations or ingredient regulations 
that are affected by, or that cover, the new or revised food standard. 
FSIS is

[[Page 29224]]

proposing this principle so that any requirements of the standards are 
consistent with other regulatory requirements. Similarly, proposed 
Sec.  130.5(b)(11) states that any proposed new or revised FDA food 
standard should take into account any other relevant regulations. For 
example, a proposed new or revised food standard should be consistent 
with common or usual name regulations for related commodities or 
products. FDA is proposing this general principle to encourage the 
grouping of similar food products when changes to food standards are 
addressed, so that there is a consistent approach to establishing, 
revising, and eliminating food standards in the regulations.
    Separately from FSIS, FDA is further proposing within this general 
principle (Sec.  130.5(b)(11)) that any specific requirements for foods 
intended for further manufacturing should be incorporated within the 
reference food standard rather than being established as a separate 
food standard. FDA believes that any specific and important 
requirements for foods that are to be manufactured further could be 
incorporated within the standard for its particular reference food, 
and, therefore, existing FDA standards for foods-for-further 
manufacturing should be considered for elimination and incorporation 
within the appropriate reference food standard. For example, important 
elements of the requirements stated in the FDA food standard for cocoa 
with dioctyl sodium sulfosuccinate for manufacturing (21 CFR 163.117) 
could be incorporated as a separate paragraph within the standard for 
its reference food (i.e., cocoa). Similarly, the requirements stated in 
the FDA food standard, cheddar cheese for manufacturing (Sec.  
133.114), could be incorporated into the food standard for cheddar 
cheese. This proposed principle also applies to FDA food standards 
where the differences between a standardized food and the same food-
for-further-manufacturing are minimized by processes used to make a 
finished food from the food-for-further-manufacturing. Because FSIS 
does not have standards for foods-for-further-manufacturing, there is 
no parallel provision in FSIS's proposed general principle, 9 CFR 
410.1(a)(11). Proposed 9 CFR 410.1(a)(12) and 21 CFR 130.5(b)(12) state 
that food standards should provide the terms that can be used to name a 
food and should allow such terms to be used in any order that is not 
misleading to consumers.
    Thus, under this proposed principle, the food standard should 
provide the terms that can be used to name a food and should provide 
that such terms can be used in any order that is not misleading, rather 
than list every possible combination of terms that may be used to name 
a standardized food (e.g., the nomenclature in the current FDA standard 
of identity for wheat and soy macaroni product (21 CFR 139.140) and the 
FSIS standard for braunschweiger and liver sausage or liverwurst (9 CFR 
319.182)).
    Proposed 9 CFR 410.1(a)(13) and 21 CFR 130.5(b)(13) state that the 
names of ingredients and functional use categories in a food standard 
should be consistent with other food standards and relevant regulations 
and, when appropriate, incorporate current scientific nomenclature. 
Functional use categories include, but are not limited to, emulsifiers, 
sweeteners, antioxidants, stabilizers and thickeners, and texturizers. 
We are proposing these provisions because some discrepancies exist in 
the designated name of ingredients and the designated name of 
functional use categories in different food standards written at 
different times. For example, the standards for artificially sweetened 
canned fruits in 21 CFR part 145, for frozen concentrate for 
artificially sweetened lemonade in Sec.  146.121 (21 CFR 146.121), and 
for artificially sweetened fruit jams, preserves, and jellies in part 
150 are not consistent in the designated names of artificial sweeteners 
permitted. Another example is the use of the terms ``thickening 
ingredient'' in the standard for frozen concentrate for artificially 
sweetened lemonade in Sec.  146.121 and ``bulking agents'' in the 
standards for cocoa or sweet and milk chocolates and vegetable fat 
coatings in 21 CFR part 163. Although these ingredients are designated 
using different terms, both of them fall into the functional category 
``stabilizers and thickeners'' as described in Sec.  170.3(o)(28). The 
food ingredients regulations in 21 CFR chapter I, subchapters A and B 
and in 9 CFR part 424 have specific names for different ingredients and 
functional use categories, which should be incorporated into the 
revised food standards.
    To ensure that it is as easy as possible to monitor compliance with 
food standards, FSIS is proposing 9 CFR 410.1(a)(14), which states that 
the food standard should be based on the finished product. FSIS can 
most easily assess the compliance with a food standard when it is based 
on the finished product. For example, FSIS could verify that chicken 
tetrazzini is comprised of 15 percent chicken by weighing the poultry 
in the finished product (9 CFR 381.167). Some of the existing FSIS food 
standards are based on products as they are formulated for processing, 
such as when the ingredients are assembled for cooking. For example, 
the standard for meat stews requires that stews such as ``beef stew'' 
or ``lamb stew'' shall contain not less than 25 percent of meat of the 
species named on the label, computed on the weight of the fresh (that 
is, uncooked) meat (9 CFR 319.304). Therefore, to assess compliance 
with the standard, FSIS needs to observe the product's formulation or 
it needs to review relevant establishment records. In these cases, FSIS 
has traditionally monitored compliance at the point of formulation, 
while it is being assembled for cooking. FSIS is considering doing more 
of its consumer protection monitoring on a finished product basis, 
which would include in-distribution monitoring for compliance with 
standards.
    FSIS believes that monitoring compliance with standards based on an 
analysis of the finished product would protect the public because 
consumers purchase products once they are finished, not at the point of 
formulation. By enforcing standards for finished products, FSIS could 
better ensure that products meet consumer expectations. In addition, 
enforcing standards for finished products would reduce compliance costs 
for FSIS, because monitoring for compliance when a product is in-
distribution requires less staff time and is, therefore, less expensive 
for FSIS than monitoring compliance at the point of product 
formulation.
    FSIS requests comment on how it should determine the compliance of 
a food with a standard based on the finished product. FSIS is 
interested in verification methods that can be used when the product is 
no longer in the plant. Any such verification methods will have to be 
able to measure the important characteristics of the finished product.
    Although FDA food standards establish certain requirements about 
the product formulation, such as the ingredients or types of 
ingredients permitted in the manufacturing of a food, the essential 
characteristics of the food are based on the finished product, rather 
than at the point of formulation or at intermediate stages during 
manufacturing. Therefore, FDA does not believe there is a need for a 
parallel provision for this principle in the proposed FDA food 
standards principles.
    FSIS is also proposing 9 CFR 410.1(a)(15), which states that the 
food

[[Page 29225]]

standard should identify whether the product is ready-to-eat or not 
ready-to-eat. FSIS is proposing this principle to ensure that 
manufacturer, consumer, and agency expectations for the product are the 
same. The existing FSIS food standards do not specifically require the 
food conforming to the standard to be ready-to-eat or not ready-to-eat. 
As part of its consumer focus group research, FSIS is asking whether 
this information should be required to appear on the label of the 
standardized food. FSIS believes that whether a product is ready-to-eat 
or not ready-to-eat is part of the basic nature of the food.
    Therefore, this proposed principle would protect the public by 
ensuring that standardized products meet consumer expectations. Due to 
the basic nature of standardized foods regulated by FDA, FDA does not 
believe that there is a need for FDA food standards to address whether 
the food is ready to eat or not. Therefore, there is no parallel 
provision for this principle in the proposed FDA food standards 
principles.
    In proposed 9 CFR 410.1(b), FSIS is proposing that a petition to 
establish a new food standard should include a comprehensive statement 
that explains how the proposed new standard conforms to the general 
principles that apply to the new standard. In addition, FSIS is 
proposing that a petition to revise an existing food standard should 
include a comprehensive statement that explains how the proposed 
revision to the existing standard conforms to the general principles 
that apply to the proposed revision. Also in proposed 9 CFR 410.1(b), 
FSIS is proposing that a petition to eliminate an existing standard 
should include a comprehensive statement that explains how the standard 
proposed to be eliminated does not conform to any one of the first four 
general principles. Similarly, in proposed Sec.  130.5(c), FDA is 
proposing that, for petitions to FDA, this comprehensive statement 
should be provided as part of the ``Statement of Grounds'' currently 
required in a FDA citizen petition under 21 CFR 10.30.
    The agencies are proposing that any revision to a food standard 
proposed in a petition to revise an existing food standard must be 
consistent with all of the general principles that apply to it. 
Therefore, according to this proposed rule, petitioners could consider 
proposing limited changes to existing standards. However, we recommend 
that petitioners consider all of the general principles and suggest 
appropriate changes to an existing standard that make that entire 
standard consistent with all of the general principles that apply to 
that standard.
    If a petitioner proposes a revision that is consistent with the 
general principles that apply to the proposed revision but the revision 
does not include all of the changes that are needed to modernize the 
entire standard, the relevant agency will review the entire existing 
standard in light of all of the general principles to determine whether 
revisions in addition to those that the petitioner has requested are 
necessary to modernize the food standard. This process will ensure that 
there is a complete and thorough review of the food standard to address 
all relevant issues and incorporate all necessary revisions to the 
standard at one time, rather than through multiple rulemakings. 
Although we would not deny a petition solely because it proposed only 
limited changes to a standard, provided the proposed changes are 
consistent with the general principles that apply to them, it is likely 
that we would more quickly publish a proposed and final rule revising 
the standard, in response to a petition, if a petitioner has considered 
an entire existing standard in light of all the applicable general 
principles.
    Finally, under proposed 9 CFR 410.1(c) and 21 CFR 130.5(d), we are 
proposing that petitions seeking to establish or revise a food standard 
that is not consistent with the applicable general principles will be 
denied. In addition, we are proposing that petitions seeking to 
eliminate a food standard that do not demonstrate that the food 
standard is inconsistent with any one of the first four general 
principles will be denied. The petitioner would be notified of the 
reason for the denial.
    We would encourage organizations or individuals submitting 
petitions to establish, revise, or eliminate a food standard, under 
these proposed regulations, to confer with different interest groups 
(consumers, industry, the academic community, professional 
organizations, and others) in formulating them. We would recommend that 
petitioners seek out and document the support of consumers and industry 
for any recommended changes to the standards regulations to encourage 
communication with interested groups and to ensure broad support for 
any proposed standards. Petitioners could document consumer and 
industry support by including the written concurrence of 
representatives of various consumer and industry groups in the 
petitions submitted. Additionally, petitioners could include a 
statement of any meetings and discussions that have been held with 
interest groups. Appropriate weight would be given to petitions that 
reflect a consensus of different interest groups.
    However, under the present regulations, documentation of the 
support of interest groups would not be an acceptable substitute for 
the information or data that is needed to substantiate statements and 
claims made in the petition. Thus, petitions that make claims about 
consumer expectations or beliefs for the purposes of defining the basic 
nature and essential characteristics of a food should also provide 
information or data that substantiate those claims. Marketing data, 
food formulary compilations, studies of restaurant menus, and consumer 
survey and focus group research data are potentially acceptable data 
sources to substantiate statements and claims made in the petition.
    Finally, this proposed rule is not intended to and, when finalized, 
will not by itself change the existing food standards nor result in the 
complete modernization of all of the food standards; rather, it will 
address the submission of petitions to establish, revise, or eliminate 
individual food standards and the evaluation of such petitions by us. 
The proposed general principles are the agencies' first step in 
instituting a process to modernize their food standards. In the long 
term, the agencies expect that all food standards, including those for 
which the agencies receive no petitions to revise or eliminate, will be 
modernized or eliminated. However, as noted in section I.E of this 
document (see the third option that the Work Group considered), limited 
resources and competing priorities make it unlikely that the agencies 
could complete a comprehensive review of all food standards on their 
own initiative in a timely manner. A more efficient means of 
modernizing a food standard or a category of food standards is through 
petitions that demonstrate that a food standard(s) has been reviewed 
for consistency with the proposed principles. Thus, in the event we do 
not receive a petition requesting that we establish, revise, or 
eliminate a particular standard, we may, when appropriate, propose to 
establish, revise, or remove a standard on our own initiative. We will 
follow the proposed general principles as we review existing standards 
to determine whether a standard should be established, removed, or 
revised to ensure that all standards are consistent with the relevant 
statutes and the general principles.

[[Page 29226]]

    The agencies welcome petitions to consolidate variations in the 
physical attributes in standardized foods within a single food 
standard. We also welcome petitions to incorporate general requirements 
that pertain to multiple food standards of a commodity group into 
general regulatory provisions that address the commodity group (see 
proposed general principles 9 CFR 410.1 (a)(9) and (10) and 21 CFR 
130.5(b)(9) and (10)). However, the agencies recognize that developing 
these types of petitions may require more time than developing 
petitions that pertain to a single food standard. We request comment on 
the best way to efficiently and effectively make standards consistent 
with these two general principles. In particular, we are interested in 
recommendations concerning the role we should take and the role the 
public should take in revising the standards to make them consistent 
with these two general principles.
    FSIS intends to eliminate all informal or ``policy'' standards in 
the Policy Book, which address the meat and poultry content of certain 
products or define methods of processing, for which it does not receive 
a petition requesting that it adopt the entry as a regulation. FSIS 
intends to follow this course of action because few of the standards in 
the Policy Book are consistent with the proposed general principles.

III. FSIS and FDA Requests for Information

    After their submission of comments, a number of commenters on the 
FSIS and the FDA ANPRMs have informally indicated that they would like 
another opportunity to provide comments to us. This proposal provides 
that opportunity.
    We request comments both on the general principles and on how to 
best implement them. In particular, we request comments on the 
usefulness of the general principles for evaluating petitions for new 
food standards and for revising or eliminating existing food standards. 
We are also seeking comments on how to enhance the usefulness of the 
principles as a guide to external groups or individuals in evaluating 
and preparing petitions to establish, revise, or eliminate food 
standards.

IV. Executive Order 12866: Cost Benefit Analysis

    We have examined the economic implications of this proposed rule as 
required by Executive Order 12866. Executive Order 12866 directs 
agencies to assess all costs and benefits of available regulatory 
alternatives and, when regulation is necessary, to select regulatory 
approaches that maximize net benefits (including potential economic, 
environmental, public health and safety, and other advantages; 
distributive impacts; and equity). Executive Order 12866 classifies a 
rule as significant if it meets any one of a number of specified 
conditions, including having an annual effect on the economy of $100 
million or more, adversely affecting in a material way a sector of the 
economy, adversely affecting competition, or adversely affecting jobs. 
A regulation is also considered a significant regulatory action if it 
raises novel legal or policy issues. We have determined that this 
proposed rule is a significant regulatory action as defined by 
Executive Order 12866 because it raises novel legal or policy issues. 
The Unfunded Mandates Reform Act of 1995 (Public Law 104-4), requires 
cost-benefit and other analyses for significant regulatory actions. 
Section 1532(a) of the Unfunded Mandates Reform Act of 1995 defines a 
significant rule as ``any Federal mandate that may result in the 
expenditure by State, local, and tribal governments, in the aggregate, 
or by the private sector, of $100,000,000 (adjusted annually for 
inflation) in any 1 year * * *'' We have determined that this rule is 
not a significant rule under the Unfunded Mandates Reform Act.

A. Need for the Rule

    Under some conditions, standards of identity may be economically 
desirable because they reduce product search costs for consumers. 
Standards can reduce search costs by requiring products that bear 
certain standardized names to have the set of characteristics that most 
consumers expect products bearing that name to have. In this document, 
we call this set of characteristics the ``basic nature'' of a food. 
Standards are most effective at reducing search costs when most 
consumers' beliefs about the basic nature of a food are similar, and 
less effective when many consumers have different beliefs about the 
basic nature of a food.
    However, as currently written, some standards may contain 
requirements that do not contribute to this useful economic function 
because they do not correspond to most consumers' beliefs or 
expectations about the basic nature of those foods. Such standards may 
increase, rather than decrease, overall search costs because they may 
cause consumers to impute differences to products that do not actually 
exist. Increasing search costs reduces product variety and inhibits the 
introduction of new products because, if search costs increase, then 
some consumers may be more willing to settle for familiar products 
rather than spending additional time comparing products and examining 
ingredient statements to find a product they prefer. Many new products 
are developed specifically to enhance the healthfulness of traditional 
products. Therefore, increasing search costs and inhibiting the 
introduction of new products may also generate health costs for 
consumers because, if search costs increase, then some consumers may be 
more willing to settle for familiar products rather than spending 
additional time comparing products and examining ingredient statements 
to find similar but healthier products. In addition, standards that 
contain unnecessary elements or that fail to provide flexibility in 
terms of allowable food technology, may generate unnecessary production 
costs, and impede technological innovation in the food industry. Such 
standards may also serve as effective barriers to competition, thereby 
raising product prices and transferring resources from consumers to 
producers. Finally, some standards may be inconsistent with 
international standards, which may impede international trade. Impeding 
international trade may also restrict competition and lead to higher 
product prices.
    The benefits of appropriate standards and the costs of 
inappropriate standards suggest that we need to develop: (1) A list of 
principles that will govern our assessment of the standards; and (2) a 
system to facilitate the timely revision, implementation, and 
elimination of standards regulations, as appropriate.

B. Regulatory Options

    We considered the following regulatory options:
    1. Take no action;
    2. Take the proposed action;
    3. Eliminate all food standards;
    4. Establish principles for assessing standards (only); and
    5. Establish principles for assessing standards, but allow external 
parties to administer those principles.
1. Option One: Take No Action
    By convention, we treat the option of taking no new regulatory 
action as the base line for determining the costs and benefits of the 
other options. Therefore, we associate neither costs nor benefits with 
this option. The consequences of taking no action are reflected in the 
costs and benefits of the other options.

[[Page 29227]]

2. Option Two: Take the Proposed Action
    The proposed action has two primary components: (1) The 
establishment of a set of principles that we will use when assessing 
food standards, and (2) a statement of the system by which we intend to 
revise, eliminate, or establish standards in response to petitions 
submitted by external parties or on our own initiative.
    a. Benefits. One benefit of establishing a set of principles for 
assessing food standards is that it simplifies our assessment of 
standards. First, it eliminates the need for us to develop and explain 
the basis for accepting or rejecting proposed changes to standards in a 
piecemeal fashion. Establishing principles ensures that we use a 
consistent and systematic approach when assessing standards.
    A second benefit is that the principles apprise external parties of 
the framework we intend to use when assessing standards, thereby 
reducing the costs for external parties to petition us to change 
standards. In the absence of principles, external parties would need to 
spend time reviewing past rulemakings to piece together the factors we 
consider relevant in assessing standards. Also, in the absence of 
established principles, external parties may expend resources 
developing petitions that we would be unable to accept, and we would 
expend resources evaluating such petitions. If the principles allow 
external parties to present more acceptable petitions, then we will be 
able to act on the petitions more quickly and make necessary changes to 
the standards regulations more quickly. This means that benefits for 
consumers and industry will take place more quickly than would 
otherwise have been the case. A third benefit is that establishing the 
set of principles specified in this proposed rule ensures that we 
assess standards with respect to their ability to reduce consumers' 
search costs, while also reducing the likelihood that standards will 
impose unnecessary costs, or reduce competition and thereby increase 
prices.
    The proposed rule would establish a system by which we intend to 
revise, eliminate, or establish standards in response to petitions 
submitted by external parties or on our own initiative and would 
generate benefits by encouraging external parties to submit such 
petitions. External parties may already submit such petitions, and we 
already consider them. However, by stating that such petitions will 
henceforth be the primary means for initiating changes to the 
standards' regulations, we are making it clear to interested parties 
that they should submit petitions if they desire changes in the 
standards, rather than wait for us to act on our own initiative. The 
total social costs of revising, eliminating, or establishing standards 
are probably lower if external parties participate in the process than 
if they do not because external parties are often in the best position 
to identify problem areas. Such a system also transfers some of the 
costs that we currently bear in assessing standards to private 
individuals and groups, thereby allowing us to reallocate our resources 
to issues that may have greater public health significance, while still 
allowing us to address standards reform in a timely fashion. However, 
this public health benefit is probably small because we have been 
unable to devote significant resources to standards reform to date. We 
do not know the net effect of this transfer on social costs because 
private expenditures on standards also displace activity associated 
with social benefits. We have insufficient information to quantify 
these benefits. However, we will also conduct cost-benefit, regulatory 
flexibility, and other relevant analyses for all proposed and final 
regulations changing the standards regulations.
    b. Costs. One of the potential costs of establishing the proposed 
principles results from the possibility that we might finalize a set of 
principles that do not maximize the net social benefits from standards 
regulations. This could generate costs because we will be assessing the 
standards with respect to those principles. If the principles in the 
final rule do not maximize net social benefits within the statutory 
framework of food standards, then we might deny some changes to the 
standards that would have net social benefits, or might accept some 
changes that would have net social costs. However, we believe that this 
potential cost is small because we believe the principles as stated 
maximize net social benefits, and because we can revise the principles 
in response to comments or in subsequent rulemakings, if necessary.
    A second potential cost of establishing the proposed principles 
results from the inherent limitations of the approach to standards that 
we have adopted in the proposed principles. Under the proposed 
principles, a standard must reflect the basic nature of a food and its 
essential characteristics.
    Standards may accommodate certain variations of a food, provided 
those variations preserve the basic nature of the food and its 
essential characteristics. For example, shredded, grated, or diced 
forms of cheese would be permitted because they do not alter the basic 
nature of the food. However, this restriction may also generate certain 
costs. For example, if we did not require that standards preserve the 
basic nature of the food and its essential characteristics, the 
information the standards provide for consumers might be reduced. 
Without such restrictions, a particular standard might be able to cover 
more diverse compositions of a particular food under a single name and 
thus address a greater variety of consumer health and dietary needs and 
preferences. Under this alternate approach, a ``cheese'' could be made 
with non-milk ingredients to be free of lactose or milk protein, and 
``bread'' could be made using soy flour to improve the protein 
composition of the food. Under the proposed principles, such variations 
of these foods would not be permitted because they do not preserve the 
basic nature of these foods consistent with consumer expectations and 
beliefs. Such foods, however, can be marketed using nonstandardized 
names (although we recognize that, in some cases, having to market 
under a nonstandardized name may be costly and, therefore, may create a 
disincentive to create such foods). To the extent the proposed general 
principles lead to an increase in the number of foods covered by 
standards, the costs described here and other costs associated with 
standards will increase.
    Another potential cost of establishing a system to revise, 
eliminate, or establish standards in response to petitions submitted by 
external parties is that the goals and interests of such parties may 
differ from our goals. For example, external parties that work for for-
profit entities will presumably submit petitions only if they believe 
that the changes requested in their petitions will increase their 
profits by more than the cost of preparing the petitions. Such parties 
might request changes that raise profits in a manner consistent with 
the proposed principles, such as by eliminating unnecessary or 
inappropriate requirements, or in a manner that is inconsistent with 
the proposed principles, such as by restricting competition or 
preventing the introduction of new products or technology. Similarly, 
external nonprofit (or not-for-profit) groups also may have incentives, 
such as increasing their political visibility or funding, that cause 
their goals to diverge from our goals. In both cases, we think this 
cost will probably be small for three reasons. First, we will be able 
to identify inappropriate recommendations during

[[Page 29228]]

the petition review process because they will be inconsistent with the 
proposed principles. Second, we do not intend to accept statements 
about consumer beliefs or expectations for the purposes of defining the 
basic nature of a food without data or evidence supporting such 
statements. Third, we will publish proposed rules for any prospective 
changes to the standards regulations. Other interested parties will be 
able to comment on those changes and help us identify any inappropriate 
recommendations that we may have overlooked during our initial review 
of the petition.
    Another potential cost of establishing a system that relies 
primarily on petitions submitted by external parties is that some 
standards that ought to be revised, eliminated, or established may be 
difficult for interested external parties to identify as such. This is 
most likely to be a problem for standards that contain requirements 
that do not reflect what most consumers believe is the basic nature of 
those foods, but that also do not generate significant costs for 
industry. Such standards may increase consumer search costs, inhibit 
the introduction of new products, and indirectly adversely affect 
consumer health. However, the typical consumer may have insufficient 
knowledge of the existing standard or the effects of that standard and 
thus not know to submit a petition requesting changes to the standard. 
A similar situation exists with products that do not currently have a 
standard, but for which a standard would generate potential benefits 
for consumers. Again, the typical consumer may have insufficient 
information or resources to submit a petition that establishes the case 
for such a standard. We expect these costs to be small for the 
following two reasons: (1) Consumer groups may have sufficient 
resources and interest to investigate and submit petitions that include 
information on consumer expectations and beliefs in cases in which 
individual consumers would not, and (2) although we envision that 
petitions will be the driving force behind most changes in the 
standards regulations, we may, in some cases, continue to propose 
changes to the standards regulations on our own initiative. Finally, 
involving external parties in the standards review process would 
generate social costs if: (1) Those parties would not have prepared 
petitions in the absence of the proposed action, (2) we would have 
assessed the need for those changes on our own initiative in the 
absence of the proposed action, and (3) the costs of the external 
parties are above and beyond the costs we would have faced. Under these 
conditions, this rule would cause additional social resources to be 
expended on making changes to the standards regulations. These costs 
are probably small because we have no information suggesting that 
external parties' costs of submitting petitions is significantly 
different from our costs of investigating the need for comparable 
changes in the regulations.
    Based on the preceding discussion of why we expect the social costs 
associated with this rule to be small and the benefits to be relatively 
substantial, we believe that the benefits of establishing the proposed 
principles outweigh the costs.
    c. Description of the affected industry. FSIS regulations contain 
approximately 80 standards for meat and poultry products. Most of these 
standards are for heat-treated products; however, some are for raw 
products (such as ground beef, hamburger, and cuts of raw poultry). 
Therefore, all processing plants may produce at least one type of 
standardized product. According to the 1999 Report of the Secretary of 
Agriculture to the U.S. Congress, there are 1,067 meat processing 
plants, 168 poultry processing plants, and 3,130 meat and poultry 
processing plants (4,347 total processing plants). Most standards are 
for heat-treated products. Based on the 1997 Census of Manufacturers 
information, there are 1,630 establishments producing readyto- eat and 
partially heat-treated meat and poultry products; FSIS used this 
estimate in the proposed rule entitled ``Production of Processed Meat 
and Poultry Products'' (66 FR 12611). These plants would produce heat-
treated, standardized meat and poultry products.
    FDA regulations contain over 280 food standards covering a variety 
of different foods. Determining the exact number of affected firms 
would be time consuming and would not be justified by the significance 
of that information for this analysis. A significant proportion of the 
26,361 establishments identified under the North American Industry 
Classification System (NAICS) classification ``food manufacturing'' in 
the 1997 Economic Census probably produce at least some products that 
are governed by FDA food standards.
3. Option Three: Eliminate All Food Standards
    Another option would be to eliminate or significantly reduce the 
number of food standards. The benefit of eliminating all food standards 
is that it would also eliminate all of the social costs potentially 
generated by those standards. One such cost is our expenditures, and 
the expenditures of external parties, that are currently devoted to 
analyzing, developing, promulgating, modifying, and enforcing 
standards. Other social costs that would be eliminated include 
compliance costs, indirect inhibition of new technologies, and 
limitations on competition. Finally, this option would eliminate the 
ability of standards to perpetuate consumer beliefs or expectations 
that may lead some consumers to make product choices that are less 
healthful than they might otherwise make (a potential effect that is 
significantly reduced by nutrient content claim regulations).
    The cost of eliminating all standards is that many consumers would 
face increased search costs because they would lose the assurances 
provided by standards that standardized products exhibit the basic 
nature that those consumers expect those products to have. Although we 
could continue to pursue the objective of maintaining the accuracy of 
the information conveyed by product names through regulations against 
adulteration and misbranding, enforcing those regulations would require 
more agency resources, and would generally be a less effective method 
of pursuing that objective. Another cost of eliminating Federal 
standards is that the Federal Government would no longer have a 
reference point for negotiating international food standards for the 
purpose of facilitating international trade with countries and 
organizations of countries that maintain such standards.
    We have insufficient information to quantify the costs and benefits 
of this option or to compare them to those of the proposed option. 
However, the benefits of this option would be quite similar to those of 
the proposed option because the proposed principles will eliminate or 
significantly reduce the social costs associated with standards 
regulation. However, as explained previously, the expenditure, social, 
search, and loss of reference point costs of this option would probably 
be greater than the same costs of the proposed option. Therefore, this 
option would probably lead to lower net benefits than the proposed 
option.
4. Option Four: Establish Principles for Assessing Standards (Only)
    We could also establish the proposed principles for assessing 
standards but rely solely on our own resources to develop proposals for 
changing the standards regulations. The costs and benefits of this 
option would be generated solely by the establishment of

[[Page 29229]]

the proposed principles, and would correspond in type to the costs and 
benefits we discussed for Option Two. However, we believe this option 
would have lower net benefits than Option Two because it would result 
in fewer petitions to establish, revise, or eliminate food standards. 
If we do not specify that we are relying on petitions to initiate 
changes to food standards regulations, some external parties may wait 
for us to act on our own initiative. Acting on our own initiative would 
eliminate the benefit of transferring cost to external parties because 
we would have to allocate our limited resources toward revising, 
eliminating, and establishing new standards without the aid of 
information from petitions.
5. Option Five: Establish Principles for Assessing Standards, but Allow 
External Parties to Administer Those Principles
    A final option would be for us to allow external parties to revise, 
eliminate, and establish food standards using the proposed principles. 
The benefits and costs of the first component of this option, 
establishing the proposed principles, would be essentially the same as 
the corresponding benefits and costs discussed under Option Two.
    The benefit of the second component of this option, allowing 
external parties to administer mandatory standards, is that it would 
allow us to reallocate resources to areas that may have greater public 
health significance than standards. This reallocation, and its 
potential public health consequences, would be greater than that 
discussed under Option Two because under this option we would not 
devote resources to reviewing petitions, writing proposed rules, 
reviewing public comments, writing final rules, or enforcing final 
rules.
    One of the primary costs of allowing external parties to administer 
standards is that their objectives may diverge from ours. This cost 
would be greater than the similar cost discussed under Option Two 
because under Option Five we would transfer additional responsibilities 
to external parties. For example, although the proposed principles 
provide general directions for decisionmaking, they do not set forth in 
detail all potentially relevant considerations that might need to be 
dealt with. Although we could produce additional and more detailed 
principles, we would probably not be able to provide principles that 
are sufficiently detailed to cover all potentially relevant 
considerations and situations. Among the issues on which we might need 
to provide additional information to external parties would be the 
following: (1) Evaluating data on consumer perceptions and beliefs, or 
on scientific or technical issues, (2) soliciting and analyzing 
comments from consumers and other interested parties, (3) adjudicating 
conflicts between interest groups, (4) analyzing the costs and benefits 
of proposed changes, (5) addressing the impact of changes on small 
entities, and (6) assessing the impact of changes on international 
trade. Providing this type of additional and more detailed information 
would also generate costs, which would reduce the benefits of this 
option. In addition, if we administer the standards, then there may be 
situations in which it would be apparent to us that we need to revise 
the principles. External parties may not have a sufficient appreciation 
of the overall objectives of standards to recognize such situations.
    It should also be noted that this option is not legally feasible at 
this time: legislative action would be needed to amend the act, FMIA, 
and PPIA in order for external parties to develop standards having the 
force of law. Without such changes, standards established by external 
parties would be voluntary.
    Allowing external parties to administer voluntary standards could 
lead to benefits similar to those of allowing them to administer 
mandatory standards if the voluntary standards were combined with a 
voluntary labeling system under which firms that produce products 
meeting the voluntary standard could communicate that fact to 
consumers. Setting aside the issue of the benefits of the proposed 
principles, which we have already discussed, the benefit of 
establishing a system in which external parties would administer 
voluntary standards is that such a system would essentially eliminate 
compliance costs for industry because firms would not participate in 
the voluntary system unless doing so generated net profits. Although a 
system in which external parties would administer voluntary standards 
would ensure that any activity that firms take to comply with such 
standards would not generate net social costs (assuming no market 
failures), it would not eliminate the private costs associated with 
that activity. In addition, voluntary standards might eliminate some of 
the potential social costs of mandatory standards in that they would 
accommodate at least some degree of consumer variability by allowing 
standards to be used by those consumers who share the same beliefs 
about the basic nature of the relevant products as expressed in the 
standards, and ignored by those who do not.
    The social cost generated by establishing a system by which 
external parties would administer voluntary standards would be the loss 
of some of the benefits currently generated by mandatory standards. The 
benefits of voluntary standards are likely to be lower than the 
benefits of mandatory standards for the following four reasons: (1) 
Consumers who find the voluntary standards useful would need to spend 
at least some time distinguishing standardized products from 
nonstandardized products, so any reduction in search costs from 
voluntary standards would be less than that generated by mandatory 
standards; (2) external groups would probably not be able to enforce 
voluntary standards to the same degree that we can enforce mandatory 
standards, so standardized designations may become unreliable; (3) 
voluntary standards would not provide a useful reference point for 
negotiating international food standards for the purposes of 
facilitating international trade with countries and organizations of 
countries that maintain such standards; and (4) in order for consumers 
to know whether the information conveyed via voluntary standards is 
valuable for them, they would need to develop some understanding of the 
standards. The costs associated with this activity might be quite high 
for some consumers.
    We do not have sufficient information to quantify the costs and 
benefits of this option or to compare them to those of the proposed 
option. However, based on the preceding discussion, this option is 
unlikely to lead to higher net benefits than the proposed option.
6. Summary
    For the reasons discussed previously, we believe that taking the 
proposed action will generate net social benefits, and also that the 
social costs of taking the proposed action are likely to be small. We 
found that most of the other options were likely to have lower net 
benefits because they had lower benefits, higher costs, or both.

V. Regulatory Flexibility Analysis

    We have examined the economic implications of this proposed rule as 
required by the Regulatory Flexibility Act (5 U.S.C. 601-612). If a 
rule has a significant economic impact on a substantial number of small 
entities, the Regulatory Flexibility Act requires us to analyze 
regulatory options that would lessen the economic effect of the rule on 
small entities. We have made an initial determination that this 
proposed rule will not have a significant impact on a substantial 
number of small entities.

[[Page 29230]]

    Under the proposed rule, small entities would only incur direct 
compliance costs when they decide to voluntarily submit a petition 
using the general principles. These entities would only submit a 
petition when it is clear that the benefits generated from submitting 
the petition outweigh the costs of developing and submitting one. 
However, this proposed rule could generate costs other than direct 
compliance costs to the extent that it encouraged external parties to 
submit petitions, and thereby increased the number of proposed changes 
to standards that small entities may wish to analyze.
    Although this decision would also be voluntary, the competitive 
position of small entities could be impaired if they did not undertake 
this activity and other external parties attempted to use standards 
reform to gain a competitive advantage. However, this impact would 
probably be minimal because: (1) It would be difficult or impossible 
for external parties to misuse standards reform because requested 
changes would need to conform to the principles set forth in this 
proposed rule, (2) we intend to consider evidence of consensus within 
affected industries, including small businesses when making our 
decisions in regard to requested changes, (3) we do not intend to 
accept statements about consumer beliefs or expectations about the 
basic nature of a food without data or evidence supporting such 
statements, and (4) we intend to analyze the impacts on small entities 
of any proposed changes to the standards regulations.
    With respect to the number of affected firms that are small 
entities, the 1999 Report of the Secretary of Agriculture to the U.S. 
Congress identifies 1,067 meat processing plants, 168 poultry 
processing plants, and 3,130 meat and poultry processing plants (4,347 
total). The majority of these establishments would qualify as small 
businesses under the Small Business Administration definition of a 
small business. All of these plants may produce at least one type of 
standardized product because there are both raw and heattreated 
standardized products. However, most of the standards are for 
heattreated products. FSIS estimates that there are approximately 1,485 
small establishments producing ready-to-eat or heat-treated products, 
and many of these products are standardized products. This number is 
based on data from the 1997 Census of Manufacturers. FSIS used this 
data to estimate the number of small businesses that would be affected 
by the proposed rule on performance standards for the production of 
processed meat and poultry products, published in the Federal Register 
of February 27, 2001 (66 FR 12590). In addition, there are 
approximately 26,361 establishments identified in the 1997 Economic 
Census as belonging to the NAICS classification ``food manufacturing.'' 
All of these establishments may produce at least some products that are 
governed by FDA food standards. The vast majority of these 
establishments would qualify as small businesses under the Small 
Business Administration definition of a small business.

VI. Executive Order 12988: Civil Justice Reform

    FSIS: This proposed rule has been reviewed under Executive Order 
12988, Civil Justice Reform. States and local jurisdictions are pre-
empted by the FMIA and the PPIA from imposing any marking, labeling, 
packaging, or ingredient requirements on federally inspected meat and 
poultry products that are in addition to, or different than, those 
imposed under the FMIA or the PPIA. However, States and local 
jurisdictions may exercise concurrent jurisdiction over meat and 
poultry products that are outside official establishments for the 
purpose of preventing the distribution of meat and poultry products 
that are misbranded or adulterated under the FMIA or PPIA, or, in the 
case of imported articles, which are not at such an establishment, 
after their entry into the United States.
    The proposed rule is not intended to have retroactive effect. If 
this proposed rule is adopted, administrative proceedings will not be 
required before parties may file suit in court challenging this rule. 
However, the administrative procedures specified in 9 CFR 306.5 and 
381.35 must be exhausted before there is any judicial challenge of the 
application of the proposed rule, if the challenge involves any 
decision of an FSIS employee relating to inspection services provided 
under the FMIA and PPIA. 65

VII. Executive Order 13132: Federalism

    FSIS: Executive Order 13132, ``Federalism,'' requires that agencies 
assess the federalism implications of their policy statements and 
actions, i.e., the effects of those statements and actions on the 
States, on the relationship between the National Government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government. The FMIA and the PPIA pre-empt State and 
local laws in regard to the manufacture and distribution of meat and 
poultry products in interstate or foreign commerce. Therefore, FSIS 
policy statements and actions affect federalism within the context of 
these statutory pre-emptions.
    States and local jurisdictions are pre-empted by the FMIA and PPIA 
from imposing any marking, labeling, packaging, or ingredient 
requirements on federally inspected meat and poultry products that are 
in addition to, or different than, those imposed under the FMIA and the 
PPIA. States and local jurisdictions may, however, exercise concurrent 
jurisdiction over meat and poultry products that are within their 
jurisdiction and outside official establishments for the purpose of 
preventing the distribution of meat and poultry products that are 
misbranded or adulterated under the FMIA and PPIA, or, in the case of 
imported articles, that are not at such an establishment, after their 
entry into the United States.
    However, under section 301 of the FMIA and section 5 of the PPIA, a 
State may administer a State meat and poultry inspection program 
provided that it has developed and is effectively enforcing State meat 
and poultry inspection requirements at least equal to those imposed 
under titles I and IV of the FMIA and sections 1 to 4, 6 to 10, and 12 
to 22 of the PPIA. These titles contemplate continuous ongoing 
programs. When a State can no longer effectively enforce meat and 
poultry inspection requirements at least equal to Federal requirements, 
it must be ``designated'' by the Secretary of Agriculture and all 
plants within that State must operate under Federal inspection. When 
FSIS revises its meat and poultry inspection requirements, States that 
administer their own inspection programs may be affected, since they 
must continue to enforce requirements at least equal to those of FSIS. 
To minimize any additional costs States must incur to modify their 
inspection programs, FSIS grants the States significant flexibility 
under the `equal to' provisions of the FMIA and PPIA. Further, States 
are eligible to receive up to 50 percent Federal matching funds to 
cover the costs of their inspection program.
    FDA: FDA has analyzed this proposed rule in accordance with the 
principles set forth in Executive Order 13132. FDA has concluded that 
this proposed rule does not contain policies that have federalism 
implications as defined in the order and, consequently, a federalism 
summary impact statement is not required. FDA is interested in comments 
from elected State and local government officials and others on: (1) 
The need for the proposed guiding

[[Page 29231]]

principles rule to modernize food standards; (2) the proposed guiding 
principles' provisions; and (3) any other issues raised by this 
proposed rule that possibly affect State laws and authorities.

VIII. Environmental Impact

    FSIS: FSIS has been granted a categorical exclusion from the 
National Environmental Policy Act (42 U.S.C. 4321 et seq. ) 
requirements by USDA regulations (7 CFR 1b. 4) unless the Administrator 
of FSIS determines that such an action may have a significant 
environmental effect. FSIS has determined that this rule would not have 
a significant environmental effect.
    FDA: FDA has determined under 21 CFR 25.30(h) that its part of this 
action is of a type that does not individually or cumulatively have a 
significant effect on the human environment. Therefore, neither an 
environmental assessment nor an environmental impact statement is 
required.

IX. Paperwork Reduction Act of 1995

    FSIS:
    Title: General Principles and Food Standards Modernization.
    Type of Collection: New.
    Abstract: FSIS is proposing to establish a set of general 
principles for food standards. The proposed general principles will 
specify the criteria that the agencies will use in considering whether 
a petition to establish, revise, or eliminate a food standard will be 
the basis for a proposed rule. Under this rule, petitions to establish, 
revise, or eliminate a standard should include a comprehensive 
statement that explains how the proposed new or revised standard 
conforms to the general principles or how the standard proposed to be 
eliminated does not conform to the general principles.
    Estimate of burden: FSIS estimates that developing a petition to 
establish, revise, or eliminate a food standard that conforms to the 
general principles and developing the comprehensive statement that 
explains how the new or revised standard conforms to the general 
principles or how the standard proposed to be eliminated does not 
conform to the general principles will take an average of 40 hours.
    Respondents: Manufacturers of meat and poultry products, trade 
organizations, consumer organizations, or unaffiliated individuals.
    Estimated number of respondents: 6.
    Estimated number of responses per respondent: 1.
    Estimated total annual burden on respondents: 240 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 St. SW., Washington, 
DC 20250. Comments are invited on: (1) Whether the proposed collection 
of information is necessary for the proper performance of the functions 
of the agency, including whether the information will have practical 
utility; (2) the accuracy of the agency's estimate of the burden of the 
proposed collection of information, including the validity of the 
methodology and assumptions used; (3) ways to enhance the quality, 
utility, and clarity of the information to be collected; and (4) 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 John O'Connell, see address above, and the 
Desk Officer for Agriculture, Office of Information and Regulatory 
Affairs, Office of Management and Budget, Washington, DC 20253. 
Comments are requested by July 19, 2005. To be most effective, comments 
should be sent to the Office of Management and Budget (OMB) within 30 
days of the publication date.
    FSIS is committed to compliance with the Government Paperwork 
Elimination Act (GPEA), which requires Government agencies, in general, 
to provide the public the option of submitting information or 
transacting business electronically to the maximum extent possible.
    FDA:
    This proposed rule contains information provisions that are subject 
to review by OMB under the Paperwork Reduction act of 1995 (44 U.S.C. 
3501-3520). A description of these provisions is given below with an 
estimate of the annual reporting burden. Included in the estimate is 
the time for reviewing instructions, searching existing data sources, 
gathering and maintaining the data needed, and completing and reviewing 
each collection of information.
    FDA invites comments on the following topics: (1) Whether the 
proposed collection of information is necessary for the proper 
performance of FDA's functions, including whether the information will 
have practical utility; (2) the accuracy of FDA's estimate of the 
burden of the proposed collection of information, including the 
validity of the methodology and assumptions used; (3) ways to enhance 
the quality, utility, and clarity of the information to be collected; 
and (4) ways to minimize the burden of the collection of information on 
respondents, including through the use of automated collection 
techniques, when appropriate, and other forms of information 
technology.
    Title: Food Standards; General Principles and Food Standards 
Modernization
    Description: This proposed rule would amend 21 CFR 130.5 to 
establish a list of 13 general principles that we would use when 
establishing, revising, or eliminating standards of identity. We wish 
to establish these principles to ensure that we apply consistent 
criteria when evaluating petitions relating to standards and to 
communicate these criteria to potential petitioners. Under this 
proposed rule, parties who petition us to establish a new standard or 
to revise an existing standard would need to provide a comprehensive 
statement explaining how the requested new standard or the requested 
revision is consistent with each of the relevant general principles, 
while parties who petition us to eliminate a standard would need to 
provide a comprehensive statement explaining how the standard to be 
eliminated is inconsistent with any one of the first four principles. 
In addition, we encourage but do not require parties who petition us to 
revise a standard in any way to analyze the entire existing standard 
with respect to all of the general principles and to petition us to 
make all of the revisions that such an analysis might suggest.
    Description of Respondents: Individual businesses and industry 
trade groups will probably generate most of the petitions. In addition, 
consumer advocacy groups might submit petitions, and we might also 
receive petitions from private individuals.
    Burden:
    Hour Burden Estimate
    In table 1 of this document, we present an estimate of the total 
annual hourly burden for the proposed information collection 
requirements for petitions that seek to establish new standards or 
revise existing standards. The time and cost will vary considerably 
depending on the nature of the suggested changes in food standards, the 
nature and complexity of the standards involved, and the existing 
information that can be brought to bear on the relevant issues. The 
burden hours in table 1 of this document include only that portion of 
the compliance burden that goes beyond the burden associated with the 
general requirements that apply to all citizen

[[Page 29232]]

petitions under 21 CFR 10.30, because only that portion represents a 
new information collection. The burden would be lower for petitions 
that seek to eliminate existing standards. However, the comments that 
we received on the ANPRM suggest that most petitions would involve 
revising existing standards or creating new standards. Therefore, we 
have based our burden estimates on those types of petitions. We 
received 10 petitions from 2000 through 2004, or approximately three 
petitions per year. The proposed rule might either increase or decrease 
the number of petitions. However, we do not have sufficient information 
to estimate a change in the expected number of petitions. Therefore, we 
assume that we will continue to receive three petitions per year. In 
addition, we assume that each respondent will probably only submit one 
petition per year. Therefore, we estimate three respondents per year 
with an annual frequency of one response per year.

                                 Table 1.--Estimated Annual Reporting Burden\1\
----------------------------------------------------------------------------------------------------------------
                                         Annual Frequency per     Total Annual     Hours per
  21 CFR Section    No. of Respondents         Response            Responses        Response      Total Hours
----------------------------------------------------------------------------------------------------------------
130.5(b)                           3                     1                  3          136                408
----------------------------------------------------------------------------------------------------------------
\1\ There are no capital costs or operating and maintenance costs associated with this collection of
  information.

    In table 2 of this document, we list the various information 
collection activities and burden hours that we used to estimate the 
total hours per response that we present in table 1 of this document. 
In some cases, we present our burden estimate in terms of a range and 
average. The range reflects the fact that large firms probably do much 
of the required activity as a normal part of product development. These 
firms would simply need to compile existing information for the 
comprehensive statement that shows consistency with the relevant 
general principles. However, smaller firms, industry and consumer 
groups, and private individuals may not otherwise undertake the 
activity required for the comprehensive statement. Therefore, the 
burden for these entities could be significantly higher. We expect 
large firms will probably submit most petitions. Therefore, we have 
assumed average burdens near the low end of the estimated ranges. We 
estimate that the total annual hourly burden associated with this 
information collection would be 264 to 1,512 hours. Within this range, 
we estimate that the average total annual hourly burden would be 408 
hours.

Table 2.--Average Hourly Burden of Information Collection Activities per
                                Petition
------------------------------------------------------------------------
     Information Collection Activity               Average Hours
------------------------------------------------------------------------
(1) Legal, technical, and scientific                                8
 interpretation of new information
 collection requirements (all
 principles): 8 hours.
------------------------------------------------------------------------
(2) Social scientific analysis of                                  40
 consumer surveys, focus groups, or
 market data, or scientific and technical
 analysis of restaurant menus or food
 formulary compilations to demonstrate or
 infer consumer expectations and beliefs
 relating to product identity, the
 relationship of observable and non-
 observable product attributes to product
 identity, the relationship of product
 uniformity to product identity, the
 significance of the order of terms in
 the name of the food (if the new or
 revised standard involves a newly
 standardized product name containing
 more than one term), and consumer
 valuation of observable and non-
 observable product attributes and
 product uniformity (Principles 1 to 4,
 6, 7, and 12): 8 to 320 hours, average
 40 hours.
------------------------------------------------------------------------
(3) Plain English editorial review to                               4
 produce language that is clear, easily
 understood, simple, and easy to use
 (Principles 5 and 8): 4 hours.
------------------------------------------------------------------------
(4) Technical and scientific evaluation                            32
 of whether the new or revised standard
 permits the maximum level of flexibility
 in terms of food technology subject to
 considerations of consumer expectations,
 nutritional quality, and safety,
 including an analysis of other suitable
 alternative manufacturing processes. We
 estimate the cost of generating or
 compiling of some of the necessary
 information on consumer expectations
 under another activity. The new elements
 for this activity include the safety and
 nutritional quality review and the
 investigation of the impact of
 flexibility in terms of food technology
 on product attributes that are related
 to consumer expectations. Burden: 16 to
 120 hours, average 32 hours.
------------------------------------------------------------------------
(5) Legal and scientific analysis of                                8
 whether petitioners have described any
 ingredients featuring in the new
 standard or revised standard as broadly
 and generically as possible (Principle
 6): 8 hours.
------------------------------------------------------------------------
(6) Legal, scientific, and technical                                8
 analysis of relevant Codex standards and
 preparation of a rationale for any
 differences between Codex standards and
 the new or revised standards (Principle
 7). In general, the rationale for any
 differences will probably involve
 referencing consumer expectations and
 beliefs. We estimate the burden of
 compiling or generating that information
 under Activity 2. Burden: 8 hours.
------------------------------------------------------------------------
(7) Legal, scientific, and technical                                8
 review of other food standards to
 establish that the new or revised
 standard is consistent with existing FDA
 food standards (Principles 8 and 11): 8
 hours.
------------------------------------------------------------------------
(8) Legal, scientific, and technical                                8
 analysis of ingredient technology,
 manufacturing processes, and food
 composition to eliminate unnecessary
 details (Principle 8): 8 hours.
------------------------------------------------------------------------

[[Page 29233]]


(9) Scientific and technical review to                              8
 demonstrate that the new or revised
 standard allows for variation in the
 physical attributes of the food
 (Principle 9): 8 hours.
------------------------------------------------------------------------
(10) Legal and scientific review of                                 8
 existing labeling and ingredient
 regulations to establish that the new or
 revised standard is consistent with
 those regulations (Principle 11): 8
 hours.
------------------------------------------------------------------------
(11) Scientific review of existing food                             4
 standards and current scientific
 nomenclature reference works to
 establish if the names of ingredients
 and functional use categories in new and
 revised standards are consistent with
 those used in other food standards and
 with current scientific nomenclature
 (Principle 13). Petitioners could review
 of ingredient names and functional use
 categories in other food standards as
 part of the general review of those
 standards under Activity 8. However, the
 review of nomenclature reference works
 would be an additional activity. Burden:
 4 hours
------------------------------------------------------------------------
Total Time Burden                                                 136
------------------------------------------------------------------------

    In compliance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
3507(d)), we have submitted the information collection provisions of 
this proposed rule to OMB for review. Interested persons are requested 
to fax comments regarding information collection by June 20, 2005 to 
the Office of Information and Regulatory Affairs, OMB, Attn: Fumie 
Yokota, Desk Officer, FDA, Fax 202-395-6974.

X. 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 proposed rule, FSIS will announce it 
online through the FSIS Web page located at http://www.fsis.usda.gov/regulations_&_policies/2005_Proposed_Rules_Index/index.asp
.

    The Regulations.gov Web site is the central online rulemaking 
portal of the U.S. 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 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 e-mail 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.

XI. Comments

    FSIS: See information under DATES, and ADDRESSES, and section X of 
this document.
    FDA: Interested persons may submit to the Division of Dockets 
Management (see ADDRESSES) written or electronic comments regarding 
this document. Submit a single copy of electronic comments or two paper 
copies of any mailed comments, except that individuals may submit one 
paper copy. Comments are to be identified with the docket number found 
in brackets in the heading of this document. Received comments may be 
seen in the Division of Dockets Management between 9 a.m. and 4 p.m., 
Monday through Friday.

XII. References

    The following references have been placed on display in the 
Division of Dockets Management (see ADDRESSES) and may be seen by 
interested persons between 9 a.m. and 4 p.m., Monday through Friday.
    1. CFSAN/FSIS, Memo on standards focus groups, May 30, 2001.
    2. Cates, S.C., Consumer Attitudes Toward Potential Changes in 
Food Standards of Identity, volume 1: Final Report to the FDA, 
September 2000.

List of Subjects

9 CFR Part 410

    Food grades and standards, Food labeling, Frozen foods, Meat 
inspection, Oils and fats, Poultry and poultry products.

21 CFR Part 130

    Food additives, Food grades and standards.
DEPARTMENT OF AGRICULTURE
Food Safety and Inspection Service
9 CFR Chapter III
Authority and Issuance

0
For the reasons discussed in the preamble, FSIS is proposing to amend 
chapter III of title 9 of the Code of Federal Regulations by adding new 
part 410 to subchapter E to read as follows:

PART 410--PRODUCT COMPOSITION

    Authority: 21 U.S.C. 601-695; 21 U.S.C 451-472; 7 CFR 2.18, 
2.53; 7 U.S.C. 2219(a).


Sec.  410.1  Procedure for establishing, revising, or eliminating a 
food standard.

    (a) A food standard proposed in a petition to establish a new food 
standard in part 319 or part 381, subpart P, of this chapter must be 
consistent with all of the following general principles that apply to 
the new standard. Any revision to a food standard proposed in a 
petition to revise an existing food standard in part 319 or part 381, 
subpart P, of this chapter must be consistent with all of the following 
general principles that apply to the proposed revision to the existing

[[Page 29234]]

standard. The agency will consider a petition that proposes eliminating 
a food standard if it is demonstrated that the current food standard is 
not consistent with any one of the general principles in paragraphs 
(a)(1) through (a)(4) of this section.
    (1) The food standard should protect the public.
    (2) The food standard should describe the basic nature of the food 
to ensure that consumers are not misled by the name of the food and to 
meet consumers' expectations of product characteristics and uniformity.
    (3) The food standard should reflect the essential characteristics 
of the food. The essential characteristics of a food are those that 
define or distinguish a food or describe the distinctive properties of 
a food. The essential characteristics of a food may contribute to 
achieving the food's basic nature or may reflect relevant consumer 
expectations of a food product. For example, foods may be defined or 
distinguished by their ingredients, compositional characteristics, 
physical characteristics, nutrient levels, or the manner in which they 
are produced.
    (4) The food standard should ensure that the food does not appear 
to be better or of a greater value than it is. The food standard may be 
used as a vehicle to improve the overall nutritional quality of the 
food supply.
    (5) The food standard should contain clear and easily understood 
requirements to facilitate compliance by food manufacturers.
    (6) The food standard should permit maximum flexibility in the food 
technology used to prepare the standardized food so long as that 
technology does not alter the basic nature or essential 
characteristics, or adversely affect the nutritional quality or safety, 
of the food. The food standard should provide for any suitable, 
alternative manufacturing process that accomplishes the desired effect, 
and should describe ingredients as broadly and generically as feasible.
    (7) The food standard should be harmonized with international food 
standards to the extent feasible. If the food standard is different 
from the requirements in a Codex standard for the same food, the 
petition should specify the reasons for these differences.
    (8) The food standard provisions should be simple, easy to use, and 
consistent among all standards. Food standards should include only 
those elements that are necessary to define the basic nature and 
essential characteristics of a particular food, and any unnecessary 
details should be eliminated.
    (9) The food standard should allow for variations in the physical 
attributes of the food. Where necessary to provide for specific 
variations in the physical attributes of a food within the food 
standard, the variations should be consolidated into a single food 
standard.
    (10) Whenever possible, general requirements that pertain to 
multiple food standards of a commodity group should be incorporated 
into general regulatory provisions that address the commodity group.
    (11) Any proposed new or revised food standard should take into 
account whether there are labeling or ingredient regulations in this 
chapter that are affected by, or that cover, the new or revised food 
standard, so that any requirements in the standard are consistent with 
labeling or ingredient regulations.
    (12) The food standard should provide the terms that can be used to 
name a food and should allow such terms to be used in any order that is 
not misleading to consumers.
    (13) Names of ingredients and functional use categories in a food 
standard should be consistent with other food standards in part 319 or 
part 381, subpart P, of this chapter, and relevant regulations in Sec.  
424.21 of this chapter, and, when appropriate, incorporate current 
scientific nomenclature.
    (14) The food standard should be based on the finished product.
    (15) The food standard should identify whether the product is 
ready-to-eat or not ready-to-eat.
    (b) A petition to establish a new food standard should include a 
comprehensive statement that explains how the proposed new standard 
conforms to the general principles that apply to the new standard. A 
petition to revise an existing food standard should include a 
comprehensive statement that explains how the proposed revision to the 
existing standard conforms to the general principles that apply to the 
proposed revision. A petition to eliminate a food standard should 
include a comprehensive statement that explains how the standard 
proposed to be eliminated does not conform to any one of the general 
principles in paragraphs (a)(1) through (a)(4) of this section.
    (c) A petition that proposes the establishment or revision of a 
food standard in part 319 or part 381, subpart P, of this chapter, that 
is not consistent with the applicable general principles listed under 
paragraph (a) of this section will be denied, and the petitioner will 
be notified as to the reason for the denial. A petition that proposes 
the elimination of a food standard in part 319 or part 381, subpart P, 
of this chapter that does not demonstrate that the food standard is 
inconsistent with any one of the general principles listed under 
paragraphs (a)(1) through (a)(4) of this section will be denied, and 
the petitioner will be notified as to the reason for the denial.
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Food and Drug Administration
21 CFR Chapter I
Authority and Issuance

0
Therefore, under the Federal Food, Drug, and Cosmetic Act and under 
authority delegated to the Commissioner of Food and Drugs, it is 
proposed that part 130 of chapter I of title 21 of the Code of Federal 
Regulations be amended as follows:

PART 130--FOOD STANDARDS: GENERAL

0
1. The authority citation for 21 CFR part 130 continues to read as 
follows:

    Authority: 21 U.S.C. 321, 336, 341, 343, 371.

0
2. Section 130.5 is amended by revising the section head and paragraph 
(b), redesignating paragraphs (c) and (d) as paragraphs (e) and (f), 
respectively, and adding new paragraphs (c) and (d) to read as follows:


Sec.  130.5  Procedure for establishing, revising, or eliminating a 
food standard.

* * * * *
    (b) A food standard proposed in a petition to establish a new food 
standard in parts 130 to 169 of this chapter must be consistent with 
all of the following general principles that apply to the new standard. 
Any revision to a food standard proposed in a petition to revise an 
existing food standard in parts 130 to 169 of this chapter must be 
consistent with all of the following general principles that apply to 
the proposed revision to the existing standard. The Food and Drug 
Administration will consider a petition that proposes eliminating a 
food standard if it is demonstrated that the current food standard is 
not consistent with any one of the general principles in paragraphs 
(b)(1) through (b)(4) of this section.
    (1) The food standard should promote honesty and fair dealing in 
the interest of consumers.
    (2) The food standard should describe the basic nature of the food 
to ensure that consumers are not misled by the name of the food and to 
meet consumers' expectations of product characteristics and uniformity.

[[Page 29235]]

    (3) The food standard should reflect the essential characteristics 
of the food. The essential characteristics of a food are those that 
define or distinguish a food or describe the distinctive properties of 
a food. The essential characteristics of a food may contribute to 
achieving the food's basic nature or may reflect relevant consumer 
expectations of a food product. For example, foods may be defined or 
distinguished by their ingredients, compositional characteristics, 
physical characteristics, nutrient levels, or the manner in which they 
are produced.
    (4) The food standard should ensure that the food does not appear 
to be better or of a greater value than it is. The food standard may be 
used as a vehicle to improve the overall nutritional quality of the 
food supply.
    (5) The food standard should contain clear and easily understood 
requirements to facilitate compliance by food manufacturers.
    (6) The food standard should permit maximum flexibility in the 
technology used to prepare the standardized food so long as that 
technology does not alter the basic nature or essential 
characteristics, or adversely affect the nutritional quality or safety, 
of the food. The food standard should provide for any suitable, 
alternative manufacturing process that accomplishes the desired effect, 
and should describe ingredients as broadly and generically as feasible.
    (7) Consistent with Sec.  130.6 of this chapter, the food standard 
should be harmonized with international food standards to the extent 
feasible. If the food standard is different from the requirements in a 
Codex standard for the same food, the petition should specify the 
reasons for these differences.
    (8) The food standard provisions should be simple, easy to use, and 
consistent among all food standards. Food standards should include only 
those elements that are necessary to define the basic nature and 
essential characteristics of a particular food, and any unnecessary 
details should be eliminated.
    (9) The food standard should allow for variations in the physical 
attributes of the food. Where necessary to provide for specific 
variations in the physical attributes of a food within the food 
standard, the variations should be consolidated into a single food 
standard.
    (10) Whenever possible, general requirements that pertain to 
multiple food standards of a commodity group should be incorporated 
into general regulatory provisions that address the commodity group.
    (11) The food standard should take into account any other relevant 
regulations in this chapter. For example, a proposed new or revised 
food standard should be consistent with common or usual name 
regulations for related commodities or products. Further, any specific 
requirements for foods intended for further manufacturing should be 
incorporated within the reference food standard rather than being 
provided as a separate food standard.
    (12) The food standard should provide the terms that can be used to 
name a food and should allow such terms to be used in any order that is 
not misleading to consumers.
    (13) Names of ingredients and functional use categories in a food 
standard should be consistent with other food standards and relevant 
regulations in this chapter, and, when appropriate, incorporate current 
scientific nomenclature.
    (c) As part of the Statement of Grounds required by section Sec.  
10.30 of this chapter, a petition to establish a new food standard 
should include a comprehensive statement that explains how the proposed 
new standard conforms to the general principles that apply to the new 
standard. A petition to revise an existing food standard should include 
a comprehensive statement that explains how the proposed revision to 
the existing standard conforms to the general principles that apply to 
the proposed revision. A petition to eliminate a food standard should 
include a comprehensive statement that explains how the standard 
proposed to be eliminated does not conform to any one of the general 
principles in paragraphs (b)(1) through (b)(4) of this section.
    (d) A petition that proposes the establishment or revision of a 
food standard that is not consistent with the applicable general 
principles listed under paragraph (b) of this section will be denied, 
and the petitioner will be notified as to the reason for the denial. A 
petition that proposes the elimination of a food standard that does not 
demonstrate that the food standard is inconsistent with any one of the 
general principles listed under paragraphs (b)(1) through (b)(4) of 
this section will be denied, and the petitioner will be notified as to 
the reason for the denial.
    * * * * *


    Dated: April 14, 2005.
Barbara J. Masters,
Acting Administrator, FSIS.

    Dated: April 8, 2005.
Lester M. Crawford,
Acting Commissioner of Food and Drugs.
[FR Doc. 05-9958 Filed 5-17-05; 11:25 am]

BILLING CODE 4160-01-S