What Will the Disclosure Look Like?

AMS believes that the proposed performance standard would likely provide the BE food disclosure information to consumers in an accessible manner, while allowing the entities responsible for the disclosure to have flexibility in implementing the requirements. The disclosure will have to be of sufficient size and clarity to appear prominently and conspicuously on the label, making it likely to be read and understood by the consumer under “ordinary shopping conditions.” While FDA uses the term “customary conditions of purchase,” 21 CFR 101.15, AMS has proposed to utilize the term “ordinary shopping conditions” as the statutory language references “shopping” in 7 U.S.C. 1639b(c)(4).

Placement of Disclosure

The proposed rule would provide that the BE food disclosure be placed in one of the following places:

• The information panel adjacent to the statement identifying the name and location of the manufacturer/distributor or similar information;
• Anywhere on the principal display panel; or
• An alternate panel if there is insufficient space to place the disclosure on the information panel or the principal display panel.

Types of Disclosures

The proposed rule provides three disclosure options for all food subject to the mandatory BE food disclosure, as well as additional options for small food manufacturers, and requires that the Secretary provide reasonable alternative disclosure options for food contained in small and very small packages. 7 U.S.C. 1639b(b)(2)(D), 1639b(b)(F), and 1639b(b)(E).

Text Disclosure

The amended Act allows for text disclosure of BE food as one option given to regulated entities. At the outset, for all on-package text disclosure options and alternatives, AMS proposes using the terms “bioengineered food” or “bioengineered food ingredient.” AMS is not proposing any similar terms because we believe that the statutory term, “bioengineering,” adequately describes food products of the technology that Congress intended to be within the scope of the NBFDS.

AMS proposes use of the statements “Bioengineered food” or “Contains a bioengineered food ingredient” for disclosure of BE food and BE food ingredients that appear on the list of BE foods with a high adoption rate. A food on this list would be presumed to be a BE food, absent documentation that would verify otherwise.

AMS also proposes that regulated entities would disclose the presence or possible presence of BE food and BE food ingredients that are on the list of BE foods commercially available, but not highly adopted, in the United States using the following statements: “Bioengineered food,” “May be bioengineered food,” “Contains a bioengineered food ingredient,” or “May contain a bioengineered food ingredient.” The default presumption would be that any foods on the non-high adoption BE food list may be bioengineered, and regulated entities would have discretion to use any of these disclosure options.

Symbol Disclosure

AMS proposes three alternative symbols with variations of those symbols. AMS recognizes that a multi-colored product label may increase printing costs or disrupt product design in other ways. Therefore, similar to use of the USDA Organic seal, AMS proposes to allow regulated entities to use a black and white version of the symbol. Regardless of colors, the symbol would still be required to meet the appearance and placement requirements.

Electronic or Digital Link Disclosure

The amended Act requires that the use of an electronic or digital link to disclose BE food must be accompanied by the statement “Scan here for more food information” or equivalent language that reflects technological changes. 7 U.S.C. 1639b(d)(1).

Current technology includes, among others, quick response codes that are detectable by consumers and digital watermark technology that is imperceptible to consumers, but can be scanned anywhere on a food package using a smart phone or other device. Consequently, AMS proposes two examples of alternative statements that could appear above or below an electronic or digital link to direct consumers to the link to the BE food disclosure. The proposed examples are: “Scan anywhere on package for more food information” and “Scan icon for more food information.”

AMS’s proposal would incorporate the amended Act’s requirement to include a telephone number that provides access to the BE food disclosure. The proposal would further require that the disclosure be available regardless of the time of day, and that the telephone number be located in close proximity to the electronic or digital link. The proposal would also require that the statement “Call for more food information” be utilized.

Proposed Effective and Initial Compliance Dates

The USDA intends the proposed effective and initial compliance dates to align with FDA’s proposed rule to extend the compliance dates for the changes to the Nutrition Facts and Supplement Facts label final rule and the Serving Size final rule. Those dates are January 1, 2020, and with a delayed compliance date of January 1, 2021, for small food manufacturers. See https://www.federalregister.gov/d/2018-09389/p-252.

Furthermore, USDA intends to allow regulated entities to use labels printed by the initial compliance date, regardless of whether they comply with the NBFDS, until the regulated entity uses up remaining label inventories, or until January 1, 2022, whichever date comes first. AMS is not proposing to require regulated entities to change the labels of food products that have entered the stream of commerce prior to January 1, 2022.

Diaz Trade Law specializes in food labeling compliance and will gladly assist in reviewing current labels and recommend label amendments to ensure compliance with federal regulations. Contact DTL at 305-456-3830 or email info@diaztradelaw.com. Sign up for our free monthly newsletter to stay up to date with USDA’s proposed rulemaking.

According to some researchers, this EO could have some significant ramifications. One such researcher, from the George Washington University, stated that “such a measure raises a number of issues, including the definition of a ‘new’ regulation, how offsets should be measured, the workload and enforcement involved, and how likely it is that this policy would survive in future administrations”. A Harvard Law professor believes this EO could be a potential weapon that the Office of Management and Budget (OMB) could use to harass the agencies that are required to follow this order. Many environmentalists and consumer groups have criticized this EO because they feel this order would end up “removing important protections for the public”.

While signing the executive order, President Trump stated that “America’s small businesses have been treated badly and it was virtually impossible to expand existing businesses because of the regulations”. The EO is meant to help with easing the burden on trying to open a new business or expand a current business. A survey produced by the National Small Business Association (NSBA) “found that small business owners reported spending an average of $12,000 a year on regulations and 58% of owners said federal regulations were the most burdensome source”. The NSBA found that the agencies that created the most burdensome regulations are the Department of Labor, the Environmental Protection Agency (EPA) and the Internal Revenue Service (IRS).

Small business owners, are you excited about this new rule? Believe it will reduce your compliance costs? If you want assistance in pre-compliance to ensure you are complying with the vast federal regulations, contact us at info@diaztradelaw.com.

CBP’s part of the $1.45 billion settlement dealt with a violation of 19 U.S.C. §1952, which “prohibits persons, by fraud, gross negligence or negligence, from entering or introducing, attempting to introduce, or aiding and abetting the entry or introduction of merchandise into the commerce of the United States, by means of statements or acts that are material and false, or by means of omissions which are material”.

CBP’s claim was that Volkswagen knowingly submitted material false statements and omitted material information, over multiple years, with the intent to deceive or mislead CBP concerning the EPA emissions standards. According to CBP, Volkswagen added a defeat device to their vehicles that allowed them to cheat on the federal emissions tests. By adding the defeat device to the vehicles, the CBP argued that Volkswagen was trying to evade their importer responsibilities and defraud revenue from the U.S.

The defeat device, is a computer software that suppresses “the car’s emissions control system when it’s being driven normally, allowing the system to work when the car is being tested in a lab”. Once the vehicle is driven on the road, the defeat device would stop suppressing the emissions control system and would then release almost 40 times the permitted levels of nitrogen oxide (NOx). Nitrogen oxide is a highly poisonous pollutant that can cause emphysema, bronchitis, and other respiratory diseases. According to the New York Times, the decision to use the defeat device in the VW vehicles was made more than a decade ago, after employees realized they would not be able to legally meet the clean air standards set by the United States. VW has even acknowledged that the former chief executive, Mr. Winterkorn, was given a memo in May 2014 stating that there were irregularities in the emissions of their diesel cars, but “did not realize the gravity of the diesel emission problem”.

Volkswagen could have easily avoided such a hefty penalty brought on by the fraud claim by fully complying with the customs laws that are set by the CBP and by making sure no defeat devices were used to evade EPA emission standards.

If a company is looking to import into the United States and would need to meet emissions standards by the EPA and ensure compliance with CBP laws and regulations, it is prudent that the company complies with every regulation to avoid any potential penalties. For help with CBP and EPA compliance please contact info@diaztradelaw.com.

The webinar will focus on the practical import compliance policies and procedures of both the U.S. Environmental Protection Agency (EPA) and U.S. Customs and Border Protection (CBP) for the importation of mobile source equipment such as non-road and marine spark ignition engines in motorcyles, generators, and lawn mowers.

An introduction to the EPA’s enforcement of the Clean Air Act through its regulations will be discussed.  Learn about ‘EPA Certificates of Conformity,’ ‘ EPA Administrative Settlement Agreements,’ and the proper use of EPA Form 3520.

Real-life examples of detentions and seizures by CBP will be used, along with a step by step “how to” resolve seizures and penalties by CBP and settle civil penalty cases with the EPA.

Registration may easily  be done on-line by clicking on this “Register Now”  link, or by calling Brian Barber, Director, NCBFAA Educational Institute, at (202) 466-0222.

EPA regulations regarding the importation of motor vehicles are enforced by U.S. Customs and Border Protection, which will stop, examine, and seize any engine not exactly complying with detailed EPA requirements, including proper labels displayed on the engine part.  All such importers should be aware of, and timely, accurately and completely submit EPA Form 3520-21 (EPA Declaration Form for Vehicles and Equipment Subject to Federal Air Pollution Regulations).  Failure to do so will result in the seizure of the imported merchandise by U.S. Customs, and penalties against the importer up to $37,500 per vehicle/engine in violation.  Seizures are resolved by filing a Petition with the appropriate U.S. Customs’ Fines, Penalties, and Forfeitures Office, and by negotiating and then signing an Administrative Settlement Agreement with the Air Enforcement Division of the EPA.

The aggressive enforcement of EPA’s regulations of 40 CFR Parts 86 and 90 were demonstrated in the recent settlement by Pep Boys which has agreed to pay the EPA $5 million, implement a corporate compliance program, and export over 15,000 non compliant vehicles and generators.

Chlorofluorocarbons (CFCs) are ozone depleting substances and include CFC-22 which is otherwise known as R-22 or popularly known by its trademark name, Freon, owned by DuPont.  CFC-22 is a widely used refrigerant for residential heat pump and air conditioning systems.

In 1988, the United States ratified the Montreal Protocol on Substances that Deplete the Ozone Layer. By ratifying the Protocol, the United States committed to a collaborative, international effort to regulate and phaseout ozone-depleting substances. The United States amended the Clean Air Act (CAA) in 1990 to include Title VI, Stratospheric Ozone Protection. The Clean Air Act established a schedule to phase out the production and importation of CFC-22.  Individual companies are licensed annually by the EPA to import specified maximum quantities of CFC-22.  By 2030, the CFC-22 will be completely phased out.

Neither Mr. Garrido nor Kroy Corporation were ever licensed by the EPA to import CFC-22.  They imported approximately 420,000 kilograms of CFC-22 valued at about $4 million over 2 years in violation of  18 U.S.C. section 545(smuggling).  They intentionally misdescribed the CFC-22 on documentation presented to U.S. Customs and Border Protection as another refrigerant, R-134A, which did not require any special license from the EPA. As stated in the press release by the United States Attorney’s Office for the Southern District of Florida:  “Except for a small quantity of legal refrigerant strategically placed in front of the contraband, the shipment contained CFC-22 and were accompanied by false documentation.”

The case was investigated by Special Agents from the Miami offices of the EPA and the U.S. Immigration and Customs Enforcement (ICE).  Sentencing will take place on February 11, 2010.  Mr. Garrido could be sentenced to 20 years imprisonment, and a criminal fine of $250,000 for each of the three counts to which he pled guilty.