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Mar 13 -- The Food Safety and Inspection Service (FSIS), U.S. Department of Agriculture (USDA), is proposing to amend its regulations to define the conditions under which the labeling of meat, poultry, and egg products, as well as voluntarily-inspected products, may bear voluntary label claims indicating that the product is of United States origin. The Agency is taking this action to resolve consumer confusion surrounding current voluntary label claims related to the origin of FSIS-regulated products in the U.S. marketplace. Under this proposal, establishments would not need to include these claims on the label, but if they chose to include them, they would need to meet the requirements in this rule. Comments must be received on or before May 12, 2023.

To prevent the introduction of adulterated or misbranded products into commerce, FSIS implements a prior approval program for labels intended to be used on FSIS-regulated products (9 CFR part 412). Without approved labels, these products may not be sold, offered for sale, or otherwise distributed in commerce.

Certain categories of labels must be submitted to FSIS for review and approval before use on products in commerce. However, FSIS considers certain labels that comply with the Agency's labeling rules to be “generically” approved (9 CFR 412.2). Such labels are not submitted to FSIS, because they are deemed approved if they bear all applicable mandatory labeling features and are not false or misleading, and may be applied to product in commerce, provided that supporting documentation for any information on the label is part of the labeling record. One category of labels currently eligible for generic approval is labels bearing U.S.-origin claims, like “Product of USA.”

FSIS recently conducted a comprehensive review of the Agency's current voluntary “Product of USA” labeling policy to help determine what the “Product of USA” label claim means to consumers. FSIS started this review after receiving several petitions stating that the voluntary label claim “Product of USA” is confusing to consumers. By law, no product may bear any false or misleading label, such as labeling which conveys any false impression or gives any false indication of origin. FSIS' review of the policy included a consumer survey on “Product of USA” labeling on beef and pork products. Based on the consumer survey results, reviews of consumer research, and comments received on the petitions, FSIS is proposing to amend its regulations to define the conditions under which voluntary claims may be used on the labels of meat, poultry, and egg products, as well as voluntarily-inspected products, to indicate that the products are of U.S. origin.

Under this proposed rule, two specific voluntary U.S.-origin label claims, “Product of USA” and “Made in the USA” (the “authorized claims”), would be generically approved for use on single ingredient, FSIS-regulated products derived from animals born, raised, slaughtered, and processed in the United States. The two voluntary authorized label claims “Product of USA” and “Made in the USA” would also be generically approved for use on multi-ingredient FSIS-regulated products if: (1) All FSIS-regulated components of the product are derived from animals born, raised, slaughtered, and processed in the United States; and (2) All additional ingredients, other than spices and flavorings, are of domestic origin (i.e., all preparation and processing steps of the ingredients are completed in the United States).

This proposed rule would also allow for U.S.-origin label claims other than the two authorized claims “Product of USA” and “Made in the USA.” All U.S.-origin label claims that are not authorized claims are known as “qualified claims.” These qualified claims would need to include a description on the package of all preparation and processing steps (including slaughter) that occurred in the United States upon which the claim is made. These would need to be positioned near the qualified claim and explain how the product compares to the regulatory criteria for use of the two authorized claims “Product of USA” and “Made in the USA.” For example, “Sliced and packaged in the United States using imported pork” could be a qualified claim. As with the two authorized claims “Product of USA” and “Made in the USA,” all qualified claims that meet the proposed regulatory requirements would be eligible for generic approval. The proposed rule would apply to domestic products. For product exported from the United States, FSIS would continue to verify that labeling requirements for the applicable country are met, as shown in the FSIS Export Library.

Establishments producing products covered by USDA's Agricultural Marketing Service's (AMS) Country of Origin (COOL) mandatory labeling regulations (see 7 CFR parts 60 and 65) would still need to comply with COOL requirements (see 9 CFR 317.8(b)(40)). AMS' COOL requires retailers, such as full-line grocery stores, supermarkets and club warehouse stores, to notify their customers with information regarding the source of certain foods. Should this rule become final, any FSIS-regulated product that is also a commodity subject to COOL requirements must continue to comply with those requirements.

Section IV below contains an analysis of the proposed rule's expected costs and benefits, an explanation of the assumptions, alternative scenarios, and the expected impact on small businesses. The requirements in this proposed rule, if finalized, are estimated to result in a one-time relabeling cost for industry, annual recordkeeping costs, and one-time market testing costs. Combined and annualized assuming a7-percent discount rate over 10 years, the total estimated industry cost would be $3 million. The proposed regulatory definitions of voluntary U.S.-origin claims align the meaning of those claims with consumers' understandings of the information conveyed by those claims, information that is valued by consumers. The proposed changes to the “Product of USA” voluntary labeling policy are intended to prevent false or misleading U.S. origin labeling (see 9 CFR 317.8(a), 381.129(b), 590.411(f)(1)). This would reduce the market failures associated with incorrect and asymmetric information. The proposed changes would benefit consumers by matching the voluntary authorized “Product of USA” and “Made in the USA” label claims with the definition that consumers likely expected (i.e., product derived from animals born, raised, slaughtered, and processed in the United States). If finalized, the proposed changes would allow consumers to make informed purchasing decisions, resulting in an increase in consumer benefits and preventing market failures as shoppers will be better able to choose products according to their preferences.

FRN: https://www.federalregister.gov/d/2023-04815 [17 pages]

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