Changes to Reporting Requirements-Vegetable and Specialty Crop Import Regulations; and Other Clarifying Changes-Fruit, Vegetable, and Specialty Crop Import Regulations, 12985-12996 [2020-03895]

Download as PDF 12985 Rules and Regulations Federal Register Vol. 85, No. 45 Friday, March 6, 2020 Agricultural Marketing Service 720–8938, or Email: VincentJ.Fusaro@ usda.gov. Small businesses may request information on complying with this regulation by contacting Richard Lower, Marketing Order and Agreement Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, STOP 0237, Washington, DC 20250–0237; Telephone: (202) 720– 2491, Fax: (202) 720–8938, or Email: Richard.Lower@usda.gov. SUPPLEMENTARY INFORMATION: 7 CFR Parts 944, 980, and 999 Executive Summary [Doc. No. AMS–SC–16–0064; SC16–980–1 FR] Purpose of the Final Rule This final rule streamlines and automates import entry and reporting processes for the import trade as well as USDA and USDA-accredited laboratories. These changes support the International Trade Data System (ITDS) initiative and will reduce the burden on the import industry while also enhancing AMS’ ability to ensure compliance with its import regulations. In addition, this rule allows AMS to meet a U.S. Customs and Border Protection (CBP) requirement that all government agencies participating in the ITDS project update their regulations to provide for the electronic entry of import information. This rule also ensures that the import trade has access to accurate and up-to-date information in AMS’ import regulations. This section of the FEDERAL REGISTER contains regulatory documents having general applicability and legal effect, most of which are keyed to and codified in the Code of Federal Regulations, which is published under 50 titles pursuant to 44 U.S.C. 1510. The Code of Federal Regulations is sold by the Superintendent of Documents. DEPARTMENT OF AGRICULTURE RIN 0581–AD68 Changes to Reporting Requirements— Vegetable and Specialty Crop Import Regulations; and Other Clarifying Changes—Fruit, Vegetable, and Specialty Crop Import Regulations Agricultural Marketing Service, USDA. ACTION: Final rule. AGENCY: This final rule changes the reporting requirements for certain Irish potatoes, tomatoes, and onions regulated under section 608e of the Agricultural Marketing Agreement Act of 1937, as amended (section 8e). With this change, importers of those regulated commodities that have been certified by a designated governmental inspection service other than the Federal or Federal-State Inspection Service as meeting section 8e requirements will be required to provide the inspection certificate number and a copy of the certificate to the Agricultural Marketing Service (AMS) (currently, the Canadian Food Inspection Agency is the only entity so designated). In addition, this rule changes the pistachio import regulations to provide for the electronic filing of aflatoxin test results and to eliminate a requirement to report the disposition of reworked or failed lots of pistachios. This rule also changes several of the section 8e regulations by removing or replacing outdated information. DATES: Effective September 2, 2020. FOR FURTHER INFORMATION CONTACT: Vincent Fusaro, Compliance and Enforcement Branch Chief, Specialty Crops Program, AMS, USDA; Telephone: (202) 720–2491, Fax: (202) lotter on DSKBCFDHB2PROD with RULES SUMMARY: VerDate Sep<11>2014 17:52 Mar 05, 2020 Jkt 250001 Legal Authority for the Final Rule This final rule is issued under section 8e of the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601–674), hereinafter referred to as the ‘‘Act.’’ Section 8e provides that whenever certain commodities are regulated under Federal marketing orders, imports of those commodities into the United States are prohibited unless they meet the same or comparable grade, size, quality, and/or maturity requirements as those in effect for the domestically-produced commodities. The Act also authorizes the U.S. Department of Agriculture (USDA) to perform inspections on those imported commodities and to certify whether those requirements have been met. Parts 944, 980, and 999 of title 7 of the Code of Federal Regulations (CFR) specify inspection, certification, and reporting requirements for imported commodities regulated under section 8e, PO 00000 Frm 00001 Fmt 4700 Sfmt 4700 including the governmental inspection services that are authorized to perform certification. There are no administrative procedures that must be exhausted prior to any judicial challenge to the provisions of import regulations issued under section 8e of the Act. Summary of the Provisions of the Final Rule This final rule: 1. Requires importers of certain Irish potatoes, tomatoes, and onions regulated under section 8e that have been certified by the Canadian Food Inspection Agency to electronically provide the inspection certificate number and a copy of the certificate to AMS. If unable to submit electronically, importers must submit the certificate via email, mail, or facsimile. 2. Changes the method of reporting aflatoxin test results from USDA and USDA-accredited laboratories to AMS by converting a paper form to an electronic format and expanding the reporting requirements for the laboratories to reflect the laboratories’ current practice of reporting all test results instead of only failed test results. 3. Eliminates the requirement that importers of pistachios report the disposition of reworked or failed lots of pistachios to AMS. 4. Makes other miscellaneous changes to AMS’ import regulations, including updating the agency and program names and contact information, and removing or updating other information that is out of date. Costs and Benefits To the extent that this rule will increase efficiency and cost savings, it would benefit importers. Revising the reporting requirements will streamline the regulations and reduce the burden on the trade. The other changes finalized in this action will provide the import trade with accurate information. Executive Orders 13563, 13175, 13771, 12866, and 12988 USDA is issuing this final rule in conformance with Executive Orders 13563, 13175, 12866, and 13771. See OMB’s Memorandum M–17–21 of April 5, 2017, containing guidance for implementing Executive Order 13771, titled ‘Reducing Regulation and Controlling Regulatory Costs’’’ (February 2, 2017). E:\FR\FM\06MRR1.SGM 06MRR1 12986 Federal Register / Vol. 85, No. 45 / Friday, March 6, 2020 / Rules and Regulations lotter on DSKBCFDHB2PROD with RULES This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. This rule is not intended to have retroactive effect. Background This final rule revises the reporting requirements for certain Irish potatoes, tomatoes, and onions regulated under part 980, the vegetable import regulations. This rule requires importers of those regulated commodities that have been certified by a designated governmental inspection service other than the Federal or Federal-State Inspection Service as meeting section 8e requirements to electronically enter the inspection certificate number and upload an electronic copy of the certificate to AMS. Currently, the Canadian Food Inspection Agency (CFIA) is the only designated nonFederal/Federal-State Inspection Service; therefore, references to the reporting requirement in this rule will hereinafter be described as ‘‘CFIA’’ or ‘‘Canadian’’ inspection certificates and/ or inspection information. A proposed rule concerning this action was published in the Federal Register on December 6, 2016 (81 FR 87849). The proposed rule was made available through the internet by USDA and the Office of the Federal Register. A 30-day comment period ending January 5, 2017, was provided to allow interested persons to respond to the proposal. The import industry, USDA laboratories, and USDA-accredited laboratories are aware of ITDS and its goal to streamline processes. Members of the import industry have attended annual ITDS Trade Support Network plenary sessions conducted by the U.S. Government over the past few years. No comments were received on the proposed rule. While no comments were received on the proposed rule, USDA believes that industry and laboratories would benefit from additional time to adjust to the new electronic filing and reporting requirements; accordingly, USDA is setting six months from the publication of this final rule as the effective date for these changes. In the event an importer is unable to enter the CFIA inspection information electronically, he or she will be required to provide a copy of the certificate to AMS via email, mail, or facsimile. In addition, this rule changes two pistachio import reporting requirements in § 999.600 of the specialty crop import regulations: The Imported Pistachios— Lot Notification report (form FV–249) and the Imported Pistachios—Rework and Failed Lot Disposition report (form FV–251). Both forms have been VerDate Sep<11>2014 17:52 Mar 05, 2020 Jkt 250001 previously approved for use by OMB under OMB No. 0581–0215, Pistachios Grown in California, Arizona, and New Mexico (although these two forms are included in the OMB information collection for the domestic pistachio marketing order, they are used strictly for reporting related to imported pistachios). The pistachio import regulations currently require that USDA or USDA-accredited laboratories complete a form FV–249 for all lots of imported pistachios that fail to meet aflatoxin requirements and submit the form to USDA, the CBP, and the importer who requested the aflatoxin test. The regulations also require that importers of pistachios complete and submit form FV–251 to USDA and CBP for lots that fail to meet aflatoxin requirements when the lots are reworked for further testing or, when not reworked, are exported, sold for non-human consumption, or destroyed. With the implementation of this rule, USDA or USDA-accredited labs will submit the form FV–249 electronically, reporting all aflatoxin test results (both ‘‘meets’’ and ‘‘fails’’) to USDA. In March 2017, the Office of Management and Budget (OMB) approved AMS’ request to change the FV–249 form number to SC–249 to reflect the current program name (Specialty Crops), and references to the electronic form in this rule will be to SC–249. AMS has confirmed with CBP that it does not need to receive form SC–249, and importers already receive ‘‘meets’’ and ‘‘fails’’ test results from the laboratories in the form of aflatoxin test certificates; therefore, the laboratories will electronically submit this form only to USDA. Importers will no longer be required to submit the form FV–251 because AMS has determined that information provided on this form is available from other sources. At the same time, AMS obtained OMB’s approval for changes to the information collection currently approved under OMB No. 0581–0215, including removal of form FV–251 from the information collection. Providing for electronic submission of the form SC–249 and removing the requirement that importers submit the form FV–251 supports the ITDS initiative by streamlining processes and reducing the burden on America’s import trade without compromising AMS’ ability to ensure compliance with its import regulations. This rule makes other changes to the fruit, vegetable, and specialty crop import regulations in §§ 944.400, 944.401, 980.1, 980.117, 980.212, 999.1, 999.100, 999.300, and 999.400. These changes, which include updating agency and program names and contact PO 00000 Frm 00002 Fmt 4700 Sfmt 4700 information and removing or updating other information that is out of date, will help ensure the import regulations contain accurate information and align with the ITDS objective of streamlining import processes for the trade. This final rule does not remove any specific requirements related to the physical inspection of potatoes, onions, or tomatoes, only the manner in which inspection results are reported. All domestic and imported potatoes, onions, and tomatoes must still be inspected to ensure grade, quality and wholesomeness during the regulated period. All domestic growers of these commodities are also still required to register with the applicable marketing order committee or board. The marketing order committees/boards will still verify that inspections occur for domestically produced commodities. Importers are still required to register each entry by filing with CBP’s Automated Commercial Environment (ACE). The AMS Marketing Order and Agreement Division (MOAD) will then verify whether imported products have met inspection requirements. Certification by Canadian Food Inspection Agency (CFIA) In part 980, the following sections prescribe the grade, size, quality, and maturity requirements for imported vegetable commodities that are regulated under section 8e: § 980.1(b) for potatoes, § 980.117(b) for onions, and § 980.212(b) for tomatoes. Further, the following sections in part 980 specify the governmental inspection services that are designated to certify that grade, size, quality, and maturity requirements of the commodities have been met: § 980.1(f) for potatoes, § 980.117(e) for onions, and § 980.212(e) for tomatoes. Part 980 also specifies that an inspection certificate issued by a designated government inspection service certifying that the potatoes, onions, and tomatoes meet the import requirements is required for all imports (§§ 980.1(g), 980.117(f), and 980.212(f) for potatoes, onions, and tomatoes, respectively. As noted above, the vegetable import regulations specify those domestic and foreign government inspection services that are designated to certify that imported potatoes, onions, and tomatoes meet grade, size, quality, and maturity requirements. Currently, the only foreign designated governmental inspection service is CFIA. When importers have potatoes, onions, or tomatoes inspected in Canada prior to import into the United States, an inspection certificate is provided to the importer that certifies that the E:\FR\FM\06MRR1.SGM 06MRR1 Federal Register / Vol. 85, No. 45 / Friday, March 6, 2020 / Rules and Regulations lotter on DSKBCFDHB2PROD with RULES commodity meets section 8e import requirements. These certificates are comprised of various formats, including a Certificate of Inspection for Fresh Fruits and Vegetables—Shipping Point (also known as Form CFIA/ACIA 5314 or E2 and E3 Certificates) and an Export Document for C–PIQ Establishments— Fresh Fruits and Vegetables (also known as a C–PIQ form). CFIA issues C–PIQ forms to C–PIQ establishments that meet the requirements defined within the CFIA quality assurance program, known as ‘‘Canadian Partners in Quality’’ (C– PIQ). Currently, the C–PIQ program is only active for potatoes. All of these Canadian certificates contain similar information as required by the AMS vegetable import regulations, including the date of inspection, the name of the shipper, the commodity inspected, the quantity of the commodity covered by the certificate, and a statement indicating that the commodity meets the import requirements of section 8e. Currently, Canadian certificates that state that potatoes meet section 8e requirements are presented to CBP at the United States/Canada border, prior to entry into the United States. AMS conducts periodic reviews at CFIA offices and potato handling facilities in various Canadian provinces during which inspectors from AMS’ Specialty Crops Inspection (SCI) Division, as well as Compliance and Enforcement Specialists from AMS’ MOAD, observe inspection processes and review records at traditional shipping points and maintained under the C–PIQ program for potatoes exported from Canada to the United States. However, importers have not been required to submit copies of the Canadian E2, E3, or C–PIQ certificates or otherwise provide proof of Canadian inspection to AMS. Electronic Entry of Canadian Certificate Information in ACE CBP’s ACE is the primary system through which the global trade community electronically files information about imports and exports so that admissibility into the United States may be determined and government agencies may monitor compliance. ACE is the platform that provides a ‘‘single window’’ through which the global trade community electronically files shipment data, instead of completing or submitting paper-based forms to report the same information to different government agencies. This ‘‘single window’’ concept is a key component of ITDS, a system that is designed to reduce the burden on America’s import and export trade while still providing information to government agencies that is necessary VerDate Sep<11>2014 17:52 Mar 05, 2020 Jkt 250001 for the United States to ensure compliance with its laws. In conjunction with the full implementation of the ITDS ‘‘single window,’’ CBP required that government agencies participating in the ITDS project, including AMS, ensure that regulations provide for the electronic entry of import and/or export information. This mandate was instituted through the Border Interagency Executive Council’s (BIEC) effort to implement Executive Order 13659 and its governance structure to ensure coordination. CBP shares ACE data with Partnering Government Agencies (PGA) that have entered into a Memorandum of Understanding (MOU) with CBP. ACE data sharing MOUs with PGAs define and limit the scope and use of information shared pursuant to the PGA’s respective authorities. AMS developed and in 2017 began deploying a new automated system called the Compliance and Enforcement Management System (CEMS) that interfaces with CBP’s ACE system in support of ITDS. CEMS electronically links with the ACE system to create a ‘‘pipeline’’ through which data are transmitted between MOAD and CBP. CEMS validates information electronically entered by importers in ACE and transmits messages to CBP about whether a shipment may be released for importation into the United States. AMS has determined that: (1) Requiring importers of potatoes, tomatoes and onions to provide the inspection certificate number and a copy of the certificate issued by the nonUSDA inspection agency; and (2) requiring the electronic filing of aflatoxin test results related to imported pistachios and eliminating the requirement to report disposition of reworked or failed lots of pistachios, as initially proposed, meet CBP’s requirements for ITDS by: (1) Providing for the electronic entry in ACE of certification information for potatoes, onions, and tomatoes inspected by CFIA prior to import into the United States, and (2) providing for the electronic entry of aflatoxin test results related to imported pistachios into ACE. Data will be transmitted from CBP’s ACE to AMS’ CEMS, where it will be electronically validated. Upon validation, CEMS will transmit an electronic message back to ACE indicating the shipment is cleared for import into the United States. The changes to the vegetable import regulations will automate and streamline the entry and reporting process for importers while enhancing AMS’ ability to ensure compliance with its import regulations. PO 00000 Frm 00003 Fmt 4700 Sfmt 4700 12987 These changes will also provide an option for importers to provide AMS with a paper copy of a CFIA certificate, via email, mail, or facsimile, in the event an importer is unable to electronically provide the required certificate number and image in ACE. Imported Pistachio Regulation Reporting Changes The pistachio import regulations provide that each pistachio sample drawn and prepared for aflatoxin testing by a USDA-authorized inspector be submitted to a USDA or USDAaccredited laboratory for analysis (§ 999.600(e)). Aflatoxins are a family of toxins producers by certain fungi that are found on agricultural products, including tree nuts. Aflatoxins are poisonous carcinogens. Lots that fail to meet the aflatoxin requirements currently must be reported by the laboratories to USDA, CBP, and the importer using an Imported Pistachios— Failed Lot Notification report (form FV– 249), pursuant to §§ 999.600(e), (g), and (h). Importers are also currently required to report the disposition of reworked and failed lots to USDA and CBP using an Imported Pistachios— Rework and Failed Lot Disposition report (form FV–251), pursuant to §§ 999.600(g) and (h). Both the form FV– 249 and form FV–251 were previously approved as paper forms. Section 999.600(f) requires that the laboratories provide an aflatoxin inspection certificate to importers that contains, among other things, a statement as to whether the lot meets or fails the import requirements under section 8e. Thus, all aflatoxin test results are provided to importers by the testing laboratories. Section 999.600 will be revised by changing the reporting requirements for laboratories (form SC–249) and importers (form FV–251). USDA and USDA-accredited laboratories currently submit a paper form FV–249 to USDA, CBP, and the importer when a lot fails to meet the aflatoxin requirements of the pistachio import regulations. The testing laboratories are now meeting this requirement and are also voluntarily providing information to USDA about lots that meet aflatoxin requirements; in other words, the laboratories are providing all aflatoxin test results to USDA, not just failed lot notifications. Importers currently complete and submit a paper form FV–251 to report the disposition of reworked or failed lots to USDA and CBP. To streamline the regulations and eliminate the paper-based reporting process, AMS has converted the existing paper form to an electronic format, form E:\FR\FM\06MRR1.SGM 06MRR1 lotter on DSKBCFDHB2PROD with RULES 12988 Federal Register / Vol. 85, No. 45 / Friday, March 6, 2020 / Rules and Regulations SC–249. The electronic format provides for the laboratories to report all aflatoxin test results to AMS, in line with the current practice. USDA’s Science and Technology Program approves and accredits laboratories to perform chemical analysis of pistachios for aflatoxin content. The regulations will require accredited laboratories to submit aflatoxin test results to AMS using the electronic form SC–249, and USDA laboratories will also use the electronic form SC–249 to submit test results to AMS. AMS has determined that CBP does not require this test result information, and the laboratories already provide importers with certificates for all aflatoxin tests; therefore, the laboratories will be required to electronically submit form SC–249 to only USDA and not to CBP or importers. In addition to the changes to laboratory-reporting requirements, § 999.600 will be revised to remove the requirement that importers report the disposition of reworked or failed lots to USDA and CBP using the Imported Pistachios—Rework and Failed Lot Disposition report (form FV–251). When this form was included in a proposed rule published in the Federal Register on October 11, 2011, (76 FR 65411) and implemented in a final rule published in the Federal Register on August 27, 2012, (77 FR 51686), AMS believed that the most effective way to ensure compliance with the rework and failed lot disposition requirements of the pistachio import regulations was to require importers to submit the form FV–251 with details about reworked, exported, sold for non-human consumption, or destroyed lots. Since that time, however, AMS has determined that the information provided on this form is available from other sources (for example, destruction information is available from AMS’ SCI Division) or requires additional follow up with an importer. The requirements for rework and final disposition of failed lots is not changing; only the reporting associated with these requirements is changing. Importers will no longer be required to submit the form FV–251 because AMS has determined that information provided on this form is available from other sources. In March 2017, AMS received approval from OMB to remove form FV–251 from the information collection package OMB No. 0581–0215. Accordingly, §§ 999.600(e), (g), and (h) will be revised to reflect the changes to reporting noted above. VerDate Sep<11>2014 17:52 Mar 05, 2020 Jkt 250001 Other Changes To further ensure that the fruit, vegetable, and specialty crop import regulations provide accurate information to the import trade and in furtherance of streamlining processes in support of ITDS, the following changes will be made: Contact information for inspection offices and ports of entry, and references to importers making various advance arrangements for inspection services will be revised or removed from the fruit import regulations at §§ 944.400(a) (designated inspection services and procedures), 944.401(c) (olives); the vegetable import regulations at §§ 980.1(g)(1)(ii) (potatoes), 980.117(f)(3) (onions); 980.212(f)(3) (tomatoes); and in the specialty crop regulations at §§ 999.1(c)(1) (dates), 999.100(c)(4) (walnuts), 999.300(c)(3) (raisins), and 999.400(c)(2) (filberts). The contact information for individual inspection offices and ports of entry is currently out of date in many of these sections. Under ITDS, importers will electronically file initial requests for inspection (SC–357, Initial Inspection Request for Regulated Import Commodities), which will alert the appropriate inspection office and CBP that a regulated commodity will be arriving that will require inspection at the port of entry or at another location. This electronic process will provide the needed advance notice to the inspection service. AMS’ SCI Division has amended its inspection application regulations (7 CFR parts 51 and 52) to provide for the electronic filing of the initial request for inspection, thereby meeting CBP’s requirement that the regulations of agencies participating in ITDS be revised to provide for electronic filing of shipment entry data (81 FR 93571, December 21, 2016). This rule adds contact information (address, telephone number, and facsimile numbers) for the main SCI office in Washington, DC, in the event importers need any information about inspection services. This change also makes the fruit, vegetable, and specialty crop regulations more current and consistent. Administrative changes include updating the USDA agency and program names in §§ 944.400(a) (designated inspection services and procedures) and 944.401(a)(5) and (c) (olives) in the fruit import regulations; 980.1(f) (potatoes), 980.117(e) (onions), and 980.212(e) (tomatoes) in the vegetable import regulations; and 999.600(h) (pistachios) in the specialty crop import regulations. Additionally, the word ‘‘nectarines’’ will be removed from § 944.400(a) (designated inspection services and PO 00000 Frm 00004 Fmt 4700 Sfmt 4700 procedures) of the fruit import regulations. Nectarines were regulated in the past but are not currently regulated under the fruit import regulations and should not, therefore, be listed in this section. Paperwork Reduction Act In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), AMS considered the information collection requirements necessary for form SC–357 (Initial Inspection Request for Regulated Imported Commodities) for importers to electronically complete to submit CFIA’s inspection certificates and certificate numbers. It was deemed not to place an additional paperwork burden on importers. No changes in the information collection requirements pertaining to OMB No. 0581–0125 (Regulations Governing Inspection Certification of Fresh & Processed Fruits, Vegetables, & Other Products) are necessary as a result of this action. Should any changes become necessary, they would be submitted to OMB for approval. The information collection requirements for the form SC–249 (for imported pistachios) have been previously approved by OMB and assigned OMB No. 0581–0215 (Pistachios Grown in California, Arizona, and New Mexico). As noted earlier, form SC–249 is contained within the OMB information collection for the domestic pistachio marketing order but is used strictly for imported pistachios. In March 2017, OMB approved AMS’ request for changes to the information collection currently approved under OMB No. 0581–0215, Pistachios Grown in California, Arizona and New Mexico, by renaming the existing form number and name to form SC–249, Notification of Aflatoxin Levels, to reflect the USDA program name change to Specialty Crops (SC) and the inclusion of all aflatoxin test results; providing for the electronic submission of form SC–249; and relaxing the submission requirements so that laboratories submit the form to only USDA, eliminating the need to also submit the form to CBP and importers. There are currently nine USDA-accredited laboratories that could potentially submit all aflatoxin test results to USDA instead of only failed test results using form SC–249. The number of respondents changed from 7 to 9 to cover all 9 laboratories completing the form, the estimated number of responses per respondent increased from 4 to 7 to more accurately capture the number of times per year each laboratory typically submits the form to USDA, and the annual burden E:\FR\FM\06MRR1.SGM 06MRR1 Federal Register / Vol. 85, No. 45 / Friday, March 6, 2020 / Rules and Regulations hours increased as a result of the increased number of respondents and annual responses from 5.6 hours to 11.55 hours (this is a slight reduction from the 12.60 annual burden hours that were previously calculated and included in the proposed rule concerning this action that was published in the Federal Register on December 6, 2016, 81 FR 87849). These changes necessitated by the rulemaking action were included in AMS’ request to OMB to revise this information collection and were approved by OMB in March 2017. The revised form SC– 249 was then included in the June 2017 three-year renewal of this information collection. lotter on DSKBCFDHB2PROD with RULES Executive Order 12866 and the Regulatory Flexibility Act A Regulatory Impact Analysis is required for significant rules by Executive Orders 12866 and 13563, which direct agencies to assess all costs and benefits of available regulatory alternatives. If regulation is necessary, then agencies must select the action that maximizes net benefits, including potential economic, environmental, public health and safety effects, and equity. This analysis examines the costs and benefits of this rule on importers, Customs brokers, and USDA. This document also addresses the requirement of Executive Order 13771 that agencies provide the best approximation of total costs and savings associated with a new or repealed regulation. Need for Regulatory Action This final rule streamlines and automates import entry and reporting processes for the import trade as well as USDA and USDA-accredited laboratories. These changes support the International Trade Data System (ITDS) initiative and will reduce the burden on the import industry while also enhancing AMS’ ability to ensure compliance with its import regulations. In addition, this rule allows AMS to meet a U.S. Customs and Border Protection (CBP) requirement that all government agencies participating in the ITDS project update their regulations to provide for the electronic entry of import information. This rule also ensures that the import trade has access to accurate and up-to-date information in AMS’ import regulations. Importers of Canadian potatoes, onions, and tomatoes that are certified by CFIA as meeting section 8e requirements are not currently required to provide AMS with proof of this certification prior to import. This rule mandates that AMS receive proof of VerDate Sep<11>2014 17:52 Mar 05, 2020 Jkt 250001 CFIA certification through electronic entry of CFIA certificate numbers and electronic copies of certificates. Other agencies, such as CBP, already require importers to electronically enter information about shipments. The implementation of electronic filing capability via ACE and CEMS, will allow entries and associated paperwork to be transmitted to and verified electronically by AMS. Under this system, the importer would electronically file entries via ACE, which would then electronically transmit data to CEMS. Once the data is received, CEMS automatically records information regarding the entry and transmits an electronic notification to the inspection office identified by the filer via email. The ACE Secure Data Portal is covered by OMB Control number 1651–0105 and is the primary means of importers and other trade filers to submit information to ACE and establish their user accounts. CBP published its Privacy Impact Analysis concurrent with a System of Records Notice on July 31, 2015. It is numbered DHS/CBP/PIA–003(b) and available at https://www.dhs.gov/sites/default/files/ publications/privacy-piaupdate-cbpace-july2015.pdf) CBP and AMS established a Memorandum of Understanding, dated May 29, 2019, formalizing their respective roles in sharing information that supports ACE’s ability to service the trade community. After the import undergoes a mandatory grading inspection, the inspection service electronically transmits pertinent inspection information to CEMS. If the inspection information identifies the entry as having met import requirements, CEMS automatically reconciles the inspection information against the entry information it previously stored. If the entry does not meet import requirements, a case is created in CEMS, which is electronically assigned to MOAD for investigation. This process reduces or eliminates the handling and processing of paper forms and adheres to the Paperwork Reduction Act of 1995. The previous paper-based filing method remains available for instances when the system may be temporarily off-line, or for filers with an inability to file electronically. This electronic filing option should streamline business operations, both for importers of these commodities, and for USDA, which will use the electronically submitted data to monitor compliance with section 8e regulations. Electronic submission of this certificate information would meet CBP’s requirement to ensure that the regulations of those government PO 00000 Frm 00005 Fmt 4700 Sfmt 4700 12989 agencies participating in the ITDS project, such as AMS, provide for the electronic submission of required data. This change should create little to no burden on importers while providing AMS with the ability to properly monitor imported vegetable shipments for compliance with the import regulations. This rule also changes the reporting requirements of aflatoxin test results of imported pistachios. Currently, USDA and USDA-accredited laboratories are required to submit documentation for all lots of imported pistachios that fail the test for aflatoxin to USDA, CBP, and the importer. The importer is also required to submit documentation to USDA and CBP for lots that fail the test for aflatoxin when lots are reworked for further testing, or are exported, sold for non-human consumption, or destroyed. This rule changes these requirements in that laboratories will electronically report all aflatoxin test results (both ‘‘meets’’ and ‘‘fails’’) to USDA. Importers already receive these results from laboratories through aflatoxin test certificates. CBP has reported that it does not need to receive documentation of aflatoxin test results. As all USDA and USDA-accredited laboratories already electronically supply USDA with all aflatoxin test results of imported pistachios, this rule should have little to no impact on these entities. This rule is expected to generate time and cost-savings for importers, Customs brokers, MOAD specialists, and USDA and USDA-accredited laboratories. The benefits, assessed both qualitatively and quantitatively, are expected to outweigh any costs of this rule. The burden on the impacted entities is anticipated to be minimal. Affected Entities The entities that are most likely to be affected by this rule primarily include importers of potatoes, tomatoes, and onions from Canada, and importers of pistachios. Also likely to be impacted are Customs brokers hired by importers to file the CFIA certification with CBP, MOAD specialists who are responsible to ensure that imports meet section 8e standards, and USDA and USDAaccredited laboratories that perform chemical analysis of aflatoxin levels in imported pistachios. All entities are expected to gain time and cost-savings as a result of this rule. Based on 2015 information from CBP, the most recent data available to AMS, USDA estimates that there are 25 importers of potatoes from Canada, 13 importers of onions from Canada, and 12 importers of tomatoes from Canada. E:\FR\FM\06MRR1.SGM 06MRR1 12990 Federal Register / Vol. 85, No. 45 / Friday, March 6, 2020 / Rules and Regulations The Harmonized Tariff Schedule (HTS) codes of imports of potatoes, tomatoes, and onions that are subject to quality inspection are listed in Table 1. Using these codes, USDA retrieved data from the Global Agricultural Trade System (GATS), which is administered by the USDA’s Foreign Agricultural Service (FAS). TABLE 1—HTS CODES FOR IMPORTED POTATOES, TOMATOES, AND ONIONS SUBJECT TO QUALITY INSPECTION IN ACCORDANCE WITH FEDERAL MARKETING ORDERS AND AGREEMENTS HTS codes Descriptions 0701.90.5015 ......... 0701.90.5025 ......... 0701.90.5035 ......... 0701.90.5045 ......... 0701.90.5055 ......... 0701.90.5065 ......... 0702.00.2099 ......... 0702.00.4098 ......... 0702.00.6099 ......... 0703.10.20 ............. 0703.10.30 ............. 0703.10.40 ............. Potatoes, fresh, other: In immediate containers not over 1,200 kg net weight, russet or netted gem. Potatoes, fresh, other: In immediate containers not over 1,200 kg net weight, red skin. Potatoes, fresh other: In immediate containers not over 1,200 kg net weight, other. Potatoes, fresh other, other, russet or netted gem. Potatoes, fresh, other, other, red skin. Potatoes, fresh, other, other. Tomatoes, fresh, entered from 3/1–7/14 or 9/1–11/14, other, other. Tomatoes, fresh, entered 7/15–8/31, other, other. Tomatoes, fresh, entered 11/15–last day of February, other, other. Onions, onion sets. Onions, pearl onions not over 16 mm in diameter. Onions, other. Source: CBP and Trade Automated Interface Requirements, September 2016. Table 2 shows three-year average import volumes for potatoes, tomatoes, and onions from Canada and from all U.S. trading partners for the years 2015 through 2017. As shown in the fourth column, almost all potatoes imported into the United States come from Canada. About 13 percent of imported onions originate in Canada, as do 4 percent of tomatoes. TABLE 2—AVERAGE IMPORT VOLUME OF POTATOES, TOMATOES, AND ONIONS FOR 2015–2017 Imports from Canada (lbs.) Commodity Potatoes ....................................................................................................................................... Tomatoes ..................................................................................................................................... Onions .......................................................................................................................................... 777,061,999 13,208,999 152,630,386 Total imports (lbs.) 777,115,645 307,818,502 1,144,195,001 Imports from Canada as share of total (percent) 99.99 4.29 13.34 Source: FAS–GATS. According to GATS data, potatoes account for approximately 28 percent of U.S. fresh vegetable import volume from Canada. Canada is the second-largest trading partner of the United States in terms of fresh vegetable import volume, accounting for 18 percent of fresh vegetable imports. In-shell and shelled pistachio imports are also subject to quality inspection under section 8e requirements. Table 3 lists the HTS codes of imported pistachios subject to aflatoxin testing and the three-year average volume of imports from 2015 to 2017. Turkey is the largest supplier of both in-shell and shelled imported pistachios into the United States, supplying 74 percent and 66 percent of their totals, respectively. Altogether, Turkey accounts for 70 percent, on average, of total U.S. pistachio import volume. Greece supplies 14 percent of in-shell imports, and Italy supplies 14 percent of shelled imports. TABLE 3—HTS CODES FOR IMPORTED PISTACHIOS SUBJECT TO AFLATOXIN TESTING AND AVERAGE IMPORT VOLUMES FOR 2015–2017 Imports (lbs.) HTS codes Description 0802.51 .......... 0802.52 .......... Pistachios: In shell .................................................................................................................................................. Pistachios: Shelled .................................................................................................................................................. 525,803 377,946 lotter on DSKBCFDHB2PROD with RULES Sources: CBP and Trade Automated Interface Requirements, September 2016; FAS–GATS. In addition to importers, Customs brokers are expected to be impacted by the change in reporting requirements as a result of this rule. Customs brokers are hired by importers to coordinate and file the paperwork that allows an import to enter the country. Customs brokers, who may be private individuals or VerDate Sep<11>2014 17:52 Mar 05, 2020 Jkt 250001 corporations, are authorized by CBP to assist importers and exporters in meeting Federal requirements governing trade. According to CBP, there are approximately 14,454 active licenses for Customs brokers in the United States. MOAD, along with USDA and USDAaccredited laboratories, are the final PO 00000 Frm 00006 Fmt 4700 Sfmt 4700 groups expected to be impacted by this rule. MOAD ensures that imports subject to section 8e regulations meet the same quality standards as the commodity produced domestically. MOAD oversees the compliance of 14 such commodities that are subject to section 8e regulations. As of January E:\FR\FM\06MRR1.SGM 06MRR1 Federal Register / Vol. 85, No. 45 / Friday, March 6, 2020 / Rules and Regulations 2019, there were nine USDA and USDAaccredited laboratories that perform chemical analysis on aflatoxin levels of pistachios. One of these laboratories is the USDA facility in Blakely, Georgia. The other eight are privately-owned USDA-accredited laboratories all in California. lotter on DSKBCFDHB2PROD with RULES Baseline Definition In fiscal year 2018, CEMS received and processed 34,686 electronic filings of CFIA certification from CBP’s ACE system. Importers and Customs brokers have commented that the multi-step paper-based filing process, which relied on the coordination of multiple parties, could take up to half a day to complete, compared to less than five minutes for filing electronically. Assuming an eighthour workday, AMS concludes that CEMS may generate a time savings of four hours per filing for importers and Customs brokers. Applying this time savings to the number of electronic filings in CEMS in 2018 results in a total of 138,744 hours saved by importers and Customs brokers for the year. The Bureau of Labor Statistics reports a mean hourly wage for Office and Administrative Support Occupations of $19.58 as of May 2018. Multiplying the total hours of time saved by importers and Customs brokers who used CEMS to file electronically in 2018 by the hourly wage of an Office and Administrative Support worker in 2018 leads to an estimated baseline cost savings of $2,716,608. In 2018 and prior to CEMS, MOAD required at least one full-time employee to manage the manual data-entry that accompanied the paper-based filing system. The time of this full-time employee represents a cost to the USDA of $83,462, which is the 2018 total compensation (wages and benefits) for a full-time employee at the GS–8, Step 1 pay-grade, adjusted for locality pay in the Washington, DC, region, and with benefits assumed to account for 39 percent of total compensation. Cost-Savings of the Action Based on industry feedback, AMS estimates that approximately 25 to 30 percent of Customs brokers and importers already used ACE to electronically file CFIA certification in fiscal year 2018, even though it was not yet mandatory. This speaks to importers’ and Customs brokers’ approval of CEMS and a willingness to file electronically. While businesses are generally drawn to practices that maximize efficiency and profits, the voluntary adoption of the electronic filing system by Customs brokers and importers has not been immediate. AMS VerDate Sep<11>2014 17:52 Mar 05, 2020 Jkt 250001 attributes this to resistance to change. Since 2018, the portion of Customs brokers and importers to voluntarily utilize the system has increased to more than half. It may be true that over time, the incentives to maximize efficiency and profits would overcome resistance to change, and all Customs brokers and importers would voluntarily adopt the electronic filing system. AMS recognizes, therefore, that the estimated cost-savings attributed to this rule may be overstated in the analysis that follows. Customs brokers and importers have responded positively to the change in reporting requirements, particularly in regard to the integration of CEMS in creating and filing an Importer Exempt Commodity Certificate (SC–6 form). Customs brokers and importers report to have had little or no difficulty in creating an electronic copy of the form in CEMS and report that using CEMS is an improvement compared to the former paper-based system. Based on feedback from the industry, the cost for Customs brokers and importers to use CEMS to electronically file CFIA certification will be minimal. Assuming that the number of electronic filings is evenly distributed among importers and Customs brokers, and that the figure of 34,686 electronic filings represents 25 to 30 percent of the greater population of filings, AMS estimates that the total number of filings in 2018, both electronic and paperbased, to be between 115,620 and 138,744. Multiplying this range by the four hours required to complete the paper-based filing process results in 462,480 to 554,976 total hours required to complete the filing process prior to CEMS. The product of the total hours and the mean hourly wage of an Office and Administrative Support worker in 2018 is $9,055,358 to $10,866,430 in total costs to importers and Customs brokers to administer the paper-based filing process prior to CEMS. This range represents the potential cost-savings for all importers and Customs brokers to use CEMS, including those that had already adopted its use in 2018. Subtracting the baseline hours and costsavings of 138,744 hours and $2,716,608 from the potential time and cost-savings for all importers and Customs brokers to use CEMS results in a range of additional time-savings of 323,736 to 416,232 hours and cost-savings of $6,338,751 to $8,149,823. Additionally, the streamlining of the process of gathering information and harmonizing data through CEMS results in a costsavings to USDA of $83,462. The requirement in this rule for USDA and USDA-accredited PO 00000 Frm 00007 Fmt 4700 Sfmt 4700 12991 laboratories to report to USDA all test results of chemical analysis of aflatoxin levels in pistachios is expected to generate little to no change in costs or benefits for involved parties. This is because all nine laboratories currently provide USDA with both ‘‘meets’’ and ‘‘fails’’ aflatoxin test results voluntarily. Converting the process from reporting results of failed lots only on paper to instead reporting all results electronically does not result in substantial change in burden. Executive Order 13771 In accordance with Executive Order 13771, this action has been designated as neither regulatory nor deregulatory as its resultant costs and savings are de minimis. Alternatives to the Rule Regarding alternatives to this action, AMS determined that these changes to the regulations are needed to comply with the ITDS mandate and to provide AMS with information it requires to ensure compliance with its regulations. CBP is requiring that all government agencies partnering on the ITDS initiative (including AMS) update their regulations to provide for the electronic entry of import and export shipment data. Providing for the entry of certificate information in ACE for potatoes, tomatoes, and onions imported from Canada that have been certified by CFIA as meeting section 8e requirements enhances AMS’ ability to monitor compliance while also meeting the objectives of ITDS to streamline processes for the import trade. In addition, changing the pistachio regulations by revising the reporting requirements will streamline the regulations and reduce the burden on the trade. The other changes finalized in this action will provide the import trade with accurate information. As this rule aims to streamline processes and improve efficiency, the only alternative considered was the status quo of a paper-based filing system and the reporting of only failed lots from aflatoxin tests to AMS. AMS believes that the changes in reporting requirements in this rule represent the best alternative to maximize benefits to importers, Customs brokers, MOAD specialists, and USDA and USDAaccredited laboratories. Regulatory Flexibility Analysis Pursuant to the requirements set forth in the Regulatory Flexibility Act (5 U.S.C. 601–612), AMS has considered the economic impact of this action on small entities. AMS has prepared this final Regulatory Flexibility Analysis, the E:\FR\FM\06MRR1.SGM 06MRR1 12992 Federal Register / Vol. 85, No. 45 / Friday, March 6, 2020 / Rules and Regulations purpose of which is to fit regulatory actions to the scale of businesses subject to such actions in order that small businesses will not be unduly or disproportionately burdened. Need for Regulation Importers of Canadian potatoes, onions, and tomatoes that are certified by CFIA as meeting section 8e standards are not currently required to submit this certification to AMS prior to import. By mandating that AMS receive proof of CFIA certification through electronic entry of CFIA certificate numbers and electronic copies of certificates, AMS can better ensure compliance of imports with section 8e standards. Similarly, the requirement in this rule for USDA and USDA-accredited laboratories to electronically submit all aflatoxin test results to USDA will replace outdated reporting practices and promote greater efficiency. Currently, these laboratories are required to submit documentation for all lots of imported pistachios that fail the test for aflatoxin to USDA, CBP, and the importer. The importer is also required to submit documentation to USDA and CBP for lots that fail the test for aflatoxin when lots are reworked for further testing, or are exported, sold for non-human consumption, or destroyed. This rule eliminates the need for these documents, replacing them with the requirement that laboratories electronically report all aflatoxin test results (both ‘‘meets’’ and ‘‘fails’’) to USDA. Importers already receive these results from laboratories and CBP has reported that it does not need to receive documentation of aflatoxin test results. Objectives of the Action This final rule changes the import regulations for potatoes, onions, and tomatoes by requiring proof of CFIA certification through electronic entry of CFIA certificate numbers and electronic copies of certificates. Prior to import into the United States, importers must enter into CBP’s ACE system the certificate number and upload an electronic image of the certificate for those shipments certified by CFIA as meeting section 8e requirements. This information is then transmitted through CEMS to AMS. If an importer is unable to provide this information electronically in ACE, a copy of the certificate must accompany the shipment at entry into the country, and the importer must also submit a copy of the certificate to AMS via email, mail, or facsimile. This final rule also changes the pistachio import regulations by modifying the reporting requirements for USDA and USDA-accredited laboratories that perform chemical analysis of aflatoxin levels in imported pistachios. The regulations will require these laboratories to submit all aflatoxin test results to USDA instead of only the results of failed lots. Legal Basis for the Action This final rule is issued under section 8e of the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601–674), hereinafter referred to as the ‘‘Act.’’ Section 8e provides that whenever certain commodities are regulated under Federal marketing orders, imports of those commodities into the United States are prohibited unless they meet the same or comparable grade, size, quality, and/or maturity requirements as those in effect for the domestically-produced commodities. The Act also authorizes the U.S. Department of Agriculture (USDA) to perform inspections on those imported commodities and to certify whether those requirements have been met. Parts 944, 980, and 999 of title 7 of the Code of Federal Regulations (CFR) specify inspection, certification, and reporting requirements for imported commodities regulated under section 8e, including the governmental inspection services that are authorized to perform certification. There are no administrative procedures that must be exhausted prior to any judicial challenge to the provisions of import regulations issued under section 8e of the Act. USDA has not identified any relevant Federal rules that duplicate, overlap or conflict with this final rule. A 30-day comment period ending January 5, 2017, was provided to allow interested persons to respond to the proposal. The import industry, USDA laboratories, and USDA-accredited laboratories are aware of ITDS and its goal to streamline processes. Members of the import industry have attended annual ITDS Trade Support Network plenary sessions conducted by the U.S. Government over the past few years. No comments were received on the proposed rule; accordingly, no changes will be made to the rule as proposed. Potentially Affected Small Entities Importers of potatoes, tomatoes, onions, and pistachios may be engaged in a variety of different industries and in varying segments of the supply chain. The North American Industry Classification System (NAICS) categorizes industries based on their activities. Table 5 lists potential industries with which importers may be involved that may be impacted by this rule, along with information about their sizes. TABLE 5—PROFILES OF POTENTIALLY IMPACTED IMPORTERS NAICS codes Subsector 311—Food Manufacturing 311411 ........................ lotter on DSKBCFDHB2PROD with RULES 311423 ........................ 311911 ........................ Subsector 424—Merchant Wholesalers, Nondurable Goods 424410 ........................ 424420 ........................ 424480 ........................ VerDate Sep<11>2014 Total number of firms NAICS industry description Firms with less than 100 employees Firms with 100–499 employees Firms with 500 employees and more Frozen Fruit, Juice and Vegetable Manufacturing. Dried and Dehydrated Food Manufacturing ... Roasted Nuts and Peanut Butter Manufacturing. 153 102 24 27 181 233 142 184 20 29 19 20 General Line Grocery Merchant Wholesalers Packaged Frozen Food Merchant Wholesalers. Fresh Fruit and Vegetable Merchant Wholesalers. 2,443 2,570 2,300 2,377 80 113 63 80 4,415 4,157 208 50 17:52 Mar 05, 2020 Jkt 250001 PO 00000 Frm 00008 Fmt 4700 Sfmt 4700 E:\FR\FM\06MRR1.SGM 06MRR1 Federal Register / Vol. 85, No. 45 / Friday, March 6, 2020 / Rules and Regulations 12993 TABLE 5—PROFILES OF POTENTIALLY IMPACTED IMPORTERS—Continued NAICS codes Subsector 445—Food and Beverage Stores 445110 ........................ 445292 ........................ Firms with less than 100 employees Total number of firms NAICS industry description Supermarkets and Other Grocery (except Convenience) Stores. Confectionery and Nut Stores ........................ Firms with 100–499 employees Firms with 500 employees and more 41,264 39,827 1,118 319 2,132 2,084 35 13 Source: U.S. Census Bureau—2016 County Business Patterns. Potatoes, tomatoes, onions, and pistachios may be imported for further processing or be re-entered into the stream of commerce as a fresh market product. For example, an importer of potatoes in the food manufacturing industry (Subsector 311) may utilize imports for frozen French fries or dehydrated potatoes. An importer may also purchase fresh potatoes to sell to restaurants as a wholesaler (Subsector 424), or to sell in a supermarket or grocery store (Subsector 445). According to 2016 data from the U.S. Census Bureau, most firms in the industries listed in Table 5 employ fewer than 100 people. Time-savings from the automation that CEMS provides is expected to particularly benefit importers with a smaller workforce. The Small Business Administration (SBA) determines standards by which entities are considered to be ‘‘small’’. These standards may be determined by the average annual receipts or the average employment of a firm. Table 6 shows the small business standards for the industries in which importers of potatoes, tomatoes, onions, and pistachios may be employed. Table 6 also shows the portion of businesses in these industries likely to be considered ‘‘small’’, using the information in Table 5. TABLE 6—INDUSTRY COMPARISON WITH SBA STANDARDS OF SMALL BUSINESSES 445292 ............................... Portion of industry estimated to meet standard NAICS industry description Frozen Fruit, Juice and Vegetable Manufacturing ...... Dried and Dehydrated Food Manufacturing ................ Roasted Nuts and Peanut Butter Manufacturing ........ ........................ ........................ ........................ 1,000 750 750 82% (at least). 90% (at least). 91% (at least). General Line Grocery Merchant Wholesalers ............. Packaged Frozen Food Merchant Wholesalers .......... Fresh Fruit and Vegetable Merchant Wholesalers ..... ........................ ........................ ........................ 250 200 100 94% (at least). 92% (at least). 94% (at least). Supermarkets and Other Grocery (except Convenience) Stores. Confectionery and Nut Stores ..................................... $32,500,000 ........................ Likely the majority. 7,500,000 ........................ Likely the majority. NAICS codes Subsector 311—Food Manufacturing 311411 ............................... 311423 ............................... 311911 ............................... Subsector 424—Merchant Wholesalers, Nondurable Goods 424410 ............................... 424420 ............................... 424480 ............................... Subsector 445—Food and Beverage Stores 445110 ............................... SBA size standards in number of employees SBA size standards in dollars lotter on DSKBCFDHB2PROD with RULES Sources: U.S. Small Business Administration Size Standards Table (Oct. 2017); U.S. Census Bureau—2016 County Business Patterns; U.S. Census Bureau—2016 Monthly Retail Trade Survey. The industries listed in Table 6 under NAICS Code Subsectors 311 and 424 have small business standards based on number of employees. Using the information in Table 5 on business firm size, AMS concludes that most importers of potatoes, tomatoes, onions, and pistachios in these industries are likely considered ‘‘small’’. The industries listed in Table 6 under NAICS Code Subsector 445 have small business standards based on average annual receipts. The U.S. Census Bureau, unfortunately, does not publish retail sales data specific to six-digit NAICS Code. AMS, therefore, used the VerDate Sep<11>2014 17:52 Mar 05, 2020 Jkt 250001 business firm size data in Table 5 to estimate sales by businesses with NAICS Codes 445110 and 445292 based on the retail sales data of all businesses under NAICS Code Subsector 445. In this estimate, AMS assumes retail sales to be evenly spread among all industries falling within NAICS Code Subsector 445. The results are average annual sales receipts of $1.15 million for Confectionary and Nut Stores, and $14.5 million in average annual sales receipts for Supermarkets and Other Grocery Stores. The majority of businesses in these industries are, therefore, likely ‘‘small’’. PO 00000 Frm 00009 Fmt 4700 Sfmt 4700 As of January 2019, there were a total of nine USDA and USDA-accredited laboratories that perform chemical analysis on aflatoxin levels of pistachios. One of these laboratories is the USDA facility in Blakely, Georgia. As a government entity, it is not subject to RFA analysis. The other eight are privately-owned USDA-accredited laboratories in California. The SBA classifies testing laboratories (NAICS code 541380) as small businesses if they receive no more than an average of $15 million annually. AMS could find no data on the average annual receipts of testing laboratories and is, therefore, E:\FR\FM\06MRR1.SGM 06MRR1 lotter on DSKBCFDHB2PROD with RULES 12994 Federal Register / Vol. 85, No. 45 / Friday, March 6, 2020 / Rules and Regulations unable to determine whether these eight USDA-accredited laboratories would be considered small businesses under the SBA standards. at the previously mentioned address in the FOR FURTHER INFORMATION CONTACT section. Alternatives To Minimize Impacts of Rule Regarding alternatives to this action, AMS determined that these changes to the regulations are needed to comply with the ITDS mandate and to provide AMS with information it requires to ensure compliance with its regulations. CBP is requiring that all government agencies partnering on the ITDS initiative (including AMS) update their regulations to provide for the electronic entry of import and export shipment data. Providing for the entry of certificate information in ACE for potatoes, tomatoes, and onions imported from Canada that have been certified by CFIA as meeting section 8e requirements enhances AMS’ ability to monitor compliance while also meeting the objectives of ITDS to streamline processes for the import trade. In addition, changing the pistachio regulations by revising the reporting requirements will streamline the regulations and reduce the burden on the trade. The other changes finalized in this action will provide the import trade with accurate information. AMS is committed to complying with the E-Government Act to promote the use of the internet and other information technologies to provide increased opportunities for citizen access to Government information and services, and for other purposes. USDA has not identified any relevant Federal rules that duplicate, overlap or conflict with this final rule. AMS conducted extensive stakeholder outreach as part of this rulemaking. During the summer of 2015, AMS staff members participated in 13 outreach sessions to the U.S. import industry. The sessions took place both in person as well as via webcast. The goal of these sessions was to introduce the new ACE system and the government agencies that are participating in the program. USDA presented extensive overviews of the proposed regulations and encouraged the trade to participate by creating their own companion software. Additionally, through 2017 and 2018, AMS staff coordinated extensively with CBP to prepare for the changes detailed in this Rule. A small business guide on complying with fruit, vegetable, and specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/ rules-regulations/moa/small-businesses. Any questions about the compliance guide should be sent to Richard Lower AMS has reviewed this final rule in accordance with Departmental Regulation 4300–4, Civil Rights Impact Analysis (CRIA), to identify and address any major civil rights impacts the rule might have on any protected groups of people. After a careful review of the rule’s intent and provisions, AMS has determined that this rule would not disproportionately or adversely impact any importers of commodities regulated under section 8e who are members of any protected group or employees of any USDA or USDA-accredited laboratories who are members of any protected group. VerDate Sep<11>2014 17:52 Mar 05, 2020 Jkt 250001 Civil Rights Impact Analysis List of Subjects 7 CFR Part 944 Avocados, Food grades and standards, Grapefruit, Grapes, Imports, Kiwifruit, Olives, Oranges. 7 CFR Part 980 Food grades and standards, Imports, Marketing agreements, Onions, Potatoes, Tomatoes. 7 CFR Part 999 Dates, Filberts, Food grades and standards, Imports, Nuts, Pistachios, Prunes, Raisins, Reporting and recordkeeping requirements, Walnuts. For the reasons set forth in the preamble, 7 CFR parts 944, 980, and 999 are amended as follows: ■ 1. The authority citation for 7 CFR parts 944, 980, and 999 continues to read as follows: Authority: 7 U.S.C. 601–674. PART 944—FRUITS; IMPORT REGULATIONS 2. Revise § 944.400(a) to read as follows: ■ § 944.400 Designated inspection services and procedure for obtaining inspection and certification of imported avocados, grapefruit, kiwifruit, oranges, prune variety plums (fresh prunes), and table grapes regulated under section 8e of the Agricultural Marketing Agreement Act of 1937, as amended. (a) The Federal or Federal-State Inspection Service, Specialty Crops Program, Agricultural Marketing Service, United States Department of Agriculture is hereby designated as the governmental inspection service for the purpose of certifying the grade, size, quality, and maturity of avocados, grapefruit, oranges, prune variety plums PO 00000 Frm 00010 Fmt 4700 Sfmt 4700 (fresh prunes), and table grapes that are imported into the United States. Agriculture and Agri-Food Canada is also designated as a governmental inspection service for the purpose of certifying grade, size, quality and maturity of prune variety plums (fresh prunes) only. Inspection by the Federal or Federal-State Inspection Service or the Agriculture and Agri-Food Canada, with appropriate evidence thereof in the form of an official inspection certificate, issued by the respective services, applicable to the particular shipment of the specified fruit, is required on all imports. Inspection and certification by the Federal or Federal-State Inspection Service will be available upon application in accordance with the Regulations Governing Inspection, Certification and Standards for Fresh Fruits, Vegetables, and Other Products (7 CFR part 51). For further information about Federal or Federal-State inspection services, contact Specialty Crops Inspection Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, STOP 0240, Washington, DC 20250–0237; telephone (202) 720–5870; fax (202) 720–0393. * * * * * ■ 3. In § 944.401, revise paragraphs (a)(5) and (c) to read as follows: § 944.401 Olive Regulation 1. (a) * * * (5) USDA Inspector means an inspector of the Specialty Crops Inspection Division, Specialty Crops Program, Agricultural Marketing Service, U.S. Department of Agriculture, or any other duly authorized employee of the Department. * * * * * (c) The Specialty Crops Inspection Division, Specialty Crops Program, Agricultural Marketing Service, U.S. Department of Agriculture, is hereby designated as the governmental inspection service for the purpose of certifying the grade and size of processed olives from imported bulk lots for use in canned ripe olives and the grade and size of imported canned ripe olives. Inspection by said inspection service with appropriate evidence thereof in the form of an official inspection certificate, issued by the service and applicable to the particular lot of olives, is required. With respect to imported bulk olives, inspection and certification shall be completed prior to use as packaged ripe olives. With respect to canned ripe olives, inspection and certification shall be completed prior to importation, unless imports arrive by vessel in which case the date of inspection and E:\FR\FM\06MRR1.SGM 06MRR1 Federal Register / Vol. 85, No. 45 / Friday, March 6, 2020 / Rules and Regulations certification may be after the date of importation. Any lot of olives which fails to meet the import requirements and is not being imported for purposes of contribution to a charitable organization or processing into oil may be exported or disposed of under the supervision of the Specialty Crops Inspection Division, Specialty Crops Program, AMS, USDA, with the cost of certifying the disposal borne by the importer. Such inspection and certification services will be available, upon application, in accordance with the applicable regulations governing the inspection and certification of Processed Fruits and Vegetables, Processed Products Thereof, and Certain Other Processed Food Products (7 CFR part 52). For questions about inspection services or for further assistance, contact: Specialty Crops Inspection Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, Room 1536–S, STOP 0240, Washington, DC 20250–0237; telephone (202) 720–5870; fax (202) 720–0393. * * * * * S, STOP 0240, Washington, DC 20250– 0237; telephone (202) 720–5870; fax (202) 720–0393. (ii) If certification is provided by a designated governmental inspection service other than the Federal or Federal-State Inspection Service, in accordance with 980.1(f), an importer shall electronically transmit to USDA, prior to entry, the certificate number and an electronic image of the certificate using the U.S. Customs and Border Protection’s Automated Commercial Environment system. If this information is not provided electronically prior to entry, a paper copy of the certificate must accompany the shipment at the time of entry, and a copy of the certificate must be submitted by email or mail to the Marketing Order and Agreement Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, STOP 0237, Washington, DC 20250–0237; telephone (888) 551–3523; or email 8eImports@ ams.usda.gov. * * * * * ■ 5. In § 980.117, revise paragraphs (e) and (f)(2) and (3) to read as follows: PART 980—VEGETABLES; IMPORT REGULATIONS § 980.117 4. In § 980.1, revise paragraphs (f) and (g)(1)(i) and (ii) to read as follows: ■ § 980.1 Import regulations; Irish potatoes. lotter on DSKBCFDHB2PROD with RULES * * * * * (f) Designation of governmental inspection services. The Federal or Federal-State Inspection Service, Specialty Crops Program, Agricultural Marketing Service, U.S. Department of Agriculture, and the Food of Plant Origin Division, Plant Products Directorate, Canadian Food Inspection Agency, are hereby designated as governmental inspection services for the purpose of certifying the grade, size, quality, and maturity of Irish potatoes that are imported, or to be imported, into the United States under the provisions of § 608e of the Act. (g) * * * (1)(i) Inspection and certification by the Federal or Federal-State Inspection Service will be available and performed in accordance with the rules and regulations governing certification of fresh fruits, vegetables, and other products (7 CFR part 51), and each lot shall be made available and accessible for inspection as provided therein. Cost of inspection and certification shall be borne by the applicant. For questions about inspection services or for further assistance, contact: Specialty Crops Inspection Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, Room 1536– VerDate Sep<11>2014 17:52 Mar 05, 2020 Jkt 250001 Import regulations; onions. * * * * * (e) Designation of governmental inspection service. The Federal or Federal-State Inspection Service, Specialty Crops Program, Agricultural Marketing Service, U.S. Department of Agriculture, and the Food of Plant Origin Division, Plant Products Directorate, Canadian Food Inspection Agency, are hereby designated as governmental inspection services for the purpose of certifying the grade, size, quality, and maturity of onions that are imported, or to be imported, into the United States under the provisions of section 8e of the Act. (f) * * * (2) Inspection and certification by the Federal or Federal-State Inspection Service will be available and performed in accordance with the rules and regulations governing certification of fresh fruits, vegetables and other products (7 CFR part 51). Each lot shall be made available and accessible for inspection as provided therein. Cost of inspection and certification shall be borne by the applicant. For questions about inspection services or for further assistance, contact: Specialty Crops Inspection Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, Room 1536– S, STOP 0240, Washington, DC 20250– 0237; telephone (202) 720–5870; fax (202) 720–0393. (3) If certification is provided by a designated governmental inspection PO 00000 Frm 00011 Fmt 4700 Sfmt 4700 12995 service other than the Federal or Federal-State Inspection Service, in accordance with 980.117(e), an importer shall electronically transmit to USDA, prior to entry, the certificate number and an electronic image of the certificate using the U.S. Customs and Border Protection’s Automated Commercial Environment system. If this information is not provided electronically prior to entry, a paper copy of the certificate must accompany the shipment at the time of entry, and a copy of the certificate must be submitted by email or mail to the Marketing Order and Agreement Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, STOP 0237, Washington, DC 20250–0237; telephone (888) 551–3523; email 8eImports@ ams.usda.gov; or fax (202) 720–5698. * * * * * ■ 6. In § 980.212, revise paragraphs (e) and (f)(2) and (3) to read as follows: § 980.212 Import regulations; tomatoes. * * * * * (e) Designation of governmental inspection service. The Federal or Federal-State Inspection Service, Specialty Crops Program, Agricultural Marketing Service, U.S. Department of Agriculture, and the Food of Plant Origin Division, Plant Products Directorate, Canadian Food Inspection Agency, are hereby designated as governmental inspection services for the purpose of certifying the grade, size, quality, and maturity of tomatoes that are imported, or to be imported, into the United States under the provisions of section 8e of the Act. (f) * * * (2) Inspection and certification by the Federal or Federal-State Inspection Service will be available and performed in accordance with the rules and regulations governing certification of fresh fruits, vegetables and other products (7 CFR part 51). Each lot shall be made available and accessible for inspection as provided therein. Cost of inspection and certification shall be borne by the applicant. For questions about inspection services or for further assistance, contact: Specialty Crops Inspection Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, Room 1536– S, STOP 0240, Washington, DC 20250– 0237; telephone (202) 720–5870; fax (202) 720–0393. (3) If certification is provided by a designated governmental inspection service other than the Federal or Federal-State Inspection Service, in accordance with 980.212(e), an importer shall electronically transmit to USDA, E:\FR\FM\06MRR1.SGM 06MRR1 12996 Federal Register / Vol. 85, No. 45 / Friday, March 6, 2020 / Rules and Regulations prior to entry, the certificate number and an electronic image of the certificate using the U.S. Customs and Border Protection’s Automated Commercial Environment system. If this information is not provided electronically prior to entry, a paper copy of the certificate must accompany the shipment at the time of entry, and a copy of the certificate must be submitted by email or mail to the Marketing Order and Agreement Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, STOP 0237, Washington, DC 20250–0237; telephone (888) 551–3523; email 8eImports@ usda.gov; or fax (202) 720–5698. * * * * * PART 999—SPECIALTY CROPS; IMPORT REGULATIONS § 999.100 [Amended] 7. In § 999.100, amend paragraph (c)(4) by removing the last sentence. ■ 8. In § 999.300, revise paragraph (c)(3) to read as follows: ■ § 999.300 Regulation governing importation of raisins. * * * * * (c) * * * (3) Whenever raisins are offered for inspection, the applicant shall furnish any labor and pay any costs incurred in moving and opening containers as may be necessary for proper sampling and inspection. The applicant shall also furnish the USDA inspector the entry number and such other identifying information for each lot as the inspector may request. * * * * * ■ 9. In § 999.400, revise paragraph (c)(2) to read as follows: § 999.400 Regulation governing the importation of filberts. lotter on DSKBCFDHB2PROD with RULES * * * * * (c) * * * (2) Inspection. Inspection shall be performed by USDA inspectors in accordance with the Regulations Governing the Inspection and Certification of Fresh Fruits and Vegetables and Related Products (7 CFR part 51). The cost of each such inspection and related certification shall be borne by the applicant. Whenever filberts are offered for inspection, the applicant shall furnish any labor and pay any costs incurred in moving and opening containers as may be necessary for proper sampling and inspection. The applicant shall also furnish the USDA inspector the entry number and such other identifying information for each lot as the inspector may request. Inspection must be completed prior to VerDate Sep<11>2014 17:52 Mar 05, 2020 Jkt 250001 the importation, unless imported by vessel, in which case for filberts, the date of release may be used. * * * * * ■ 10. Amend § 999.600 by revising paragraphs (e)(2) and (3), (g), and (h) to read as follows: § 999.600 Regulation governing the importation of pistachios. * * * * * (e) * * * (2) Lots that require a single test sample will be certified as ‘‘negative’’ on the aflatoxin inspection certificate if the sample has an aflatoxin level at or below 15 ppb. If the aflatoxin level is above 15 ppb, the lot fails. The laboratory shall electronically submit the results to USDA as described in paragraph (h) of this section. (3) Lots that require two test samples will be certified as ‘‘negative’’ on the aflatoxin inspection certificate if Test Sample #1 has an aflatoxin level at or below 10 ppb. If the aflatoxin level of Test Sample #1 is above 20 ppb, the lot fails and the laboratory shall electronically submit the results to USDA as described in paragraph (h) of this section. If the aflatoxin level of Test Sample #1 is above 10 ppb and at or below 20 ppb, the laboratory may, at the importer’s discretion, analyze Test Sample #2 and average the test results of Test Samples #1 and #2. Alternately, the importer may elect to withdraw the lot from testing, rework the lot, and resubmit it for testing after reworking. If the importer directs the laboratory to proceed with the analysis of Test Sample #2, a lot will be certified as negative to aflatoxin and the laboratory shall issue an aflatoxin inspection certificate if the averaged result of Test Samples #1 and #2 is at or below 15 ppb. If the average aflatoxin level of Test Samples #1 and #2 is above 15 ppb, the lot fails. The laboratory shall electronically submit the results to USDA as described in paragraph (h) of this section. * * * * * (g) Failed lots/rework procedure. Any lot or portion thereof that fails to meet the import requirements prior to or after reconditioning may be exported, sold for non-human consumption, or disposed of under the supervision the Federal or Federal-State Inspection Programs, with the costs of certifying the disposal of such lot paid by the importer. (1) Inshell rework procedure for aflatoxin. If inshell rework is selected as a remedy to meet the aflatoxin requirements of this part, then 100 percent of the product within that lot PO 00000 Frm 00012 Fmt 4700 Sfmt 9990 shall be removed from the bulk and/or retail packaging containers and reworked to remove the portion of the lot that caused the failure. Reworking shall consist of mechanical, electronic, or manual procedures normally used in the handling of pistachios. The reworked lot shall be sampled and tested for aflatoxin as specified in paragraphs (d) and (e) of this section, except that the lot sample size and the test sample size shall be doubled. If, after the lot has been reworked and tested, it fails the aflatoxin test for a second time, the lot may be shelled and the kernels reworked, sampled, and tested in the manner specified for an original lot of kernels, or the failed lot may be exported, used for non-human consumption, or otherwise disposed of. (2) Kernel rework procedure for aflatoxin. If pistachio kernel rework is selected as a remedy to meet the aflatoxin requirements of this part, then 100 percent of the product within that lot shall be removed from the bulk and/ or retail packaging containers and reworked to remove the portion of the lot that caused the failure. Reworking shall consist of mechanical, electronic, or manual procedures normally used in the handling of pistachios. The reworked lot shall be sampled and tested for aflatoxin as specified in paragraphs (d) and (e) of this section. (3) Failed lot reporting. If a lot fails to meet the aflatoxin requirements of this part, the testing laboratory shall electronically submit the results to USDA as described in paragraph (h) of this section within 10 working days of the test failure. This information must be submitted each time a lot fails aflatoxin testing. (h) Reports and Recordkeeping: Notification of Aflatoxin Levels. Each USDA or USDA-accredited laboratory shall notify the Marketing Order and Agreement Division, Specialty Crops Program, AMS, USDA of all aflatoxin test results for all lots by electronically submitting this form within 10 days of testing through a format specified by the Secretary. * * * * * Dated: February 21, 2020. Bruce Summers, Administrator, Agricultural Marketing Service. [FR Doc. 2020–03895 Filed 3–5–20; 8:45 am] BILLING CODE 3410–02–P E:\FR\FM\06MRR1.SGM 06MRR1

Agencies

[Federal Register Volume 85, Number 45 (Friday, March 6, 2020)]
[Rules and Regulations]
[Pages 12985-12996]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-03895]



========================================================================
Rules and Regulations
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains regulatory documents 
having general applicability and legal effect, most of which are keyed 
to and codified in the Code of Federal Regulations, which is published 
under 50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by the Superintendent of Documents. 

========================================================================


Federal Register / Vol. 85, No. 45 / Friday, March 6, 2020 / Rules 
and Regulations

[[Page 12985]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 944, 980, and 999

[Doc. No. AMS-SC-16-0064; SC16-980-1 FR]
RIN 0581-AD68


Changes to Reporting Requirements--Vegetable and Specialty Crop 
Import Regulations; and Other Clarifying Changes--Fruit, Vegetable, and 
Specialty Crop Import Regulations

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: This final rule changes the reporting requirements for certain 
Irish potatoes, tomatoes, and onions regulated under section 608e of 
the Agricultural Marketing Agreement Act of 1937, as amended (section 
8e). With this change, importers of those regulated commodities that 
have been certified by a designated governmental inspection service 
other than the Federal or Federal-State Inspection Service as meeting 
section 8e requirements will be required to provide the inspection 
certificate number and a copy of the certificate to the Agricultural 
Marketing Service (AMS) (currently, the Canadian Food Inspection Agency 
is the only entity so designated). In addition, this rule changes the 
pistachio import regulations to provide for the electronic filing of 
aflatoxin test results and to eliminate a requirement to report the 
disposition of reworked or failed lots of pistachios. This rule also 
changes several of the section 8e regulations by removing or replacing 
outdated information.

DATES: Effective September 2, 2020.

FOR FURTHER INFORMATION CONTACT: Vincent Fusaro, Compliance and 
Enforcement Branch Chief, Specialty Crops Program, AMS, USDA; 
Telephone: (202) 720-2491, Fax: (202) 720-8938, or Email: 
[email protected].
    Small businesses may request information on complying with this 
regulation by contacting Richard Lower, Marketing Order and Agreement 
Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue 
SW, STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-2491, 
Fax: (202) 720-8938, or Email: [email protected].

SUPPLEMENTARY INFORMATION: 

Executive Summary

Purpose of the Final Rule

    This final rule streamlines and automates import entry and 
reporting processes for the import trade as well as USDA and USDA-
accredited laboratories. These changes support the International Trade 
Data System (ITDS) initiative and will reduce the burden on the import 
industry while also enhancing AMS' ability to ensure compliance with 
its import regulations. In addition, this rule allows AMS to meet a 
U.S. Customs and Border Protection (CBP) requirement that all 
government agencies participating in the ITDS project update their 
regulations to provide for the electronic entry of import information. 
This rule also ensures that the import trade has access to accurate and 
up-to-date information in AMS' import regulations.

Legal Authority for the Final Rule

    This final rule is issued under section 8e of the Agricultural 
Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674), 
hereinafter referred to as the ``Act.'' Section 8e provides that 
whenever certain commodities are regulated under Federal marketing 
orders, imports of those commodities into the United States are 
prohibited unless they meet the same or comparable grade, size, 
quality, and/or maturity requirements as those in effect for the 
domestically-produced commodities. The Act also authorizes the U.S. 
Department of Agriculture (USDA) to perform inspections on those 
imported commodities and to certify whether those requirements have 
been met.
    Parts 944, 980, and 999 of title 7 of the Code of Federal 
Regulations (CFR) specify inspection, certification, and reporting 
requirements for imported commodities regulated under section 8e, 
including the governmental inspection services that are authorized to 
perform certification.
    There are no administrative procedures that must be exhausted prior 
to any judicial challenge to the provisions of import regulations 
issued under section 8e of the Act.

Summary of the Provisions of the Final Rule

    This final rule:
    1. Requires importers of certain Irish potatoes, tomatoes, and 
onions regulated under section 8e that have been certified by the 
Canadian Food Inspection Agency to electronically provide the 
inspection certificate number and a copy of the certificate to AMS. If 
unable to submit electronically, importers must submit the certificate 
via email, mail, or facsimile.
    2. Changes the method of reporting aflatoxin test results from USDA 
and USDA-accredited laboratories to AMS by converting a paper form to 
an electronic format and expanding the reporting requirements for the 
laboratories to reflect the laboratories' current practice of reporting 
all test results instead of only failed test results.
    3. Eliminates the requirement that importers of pistachios report 
the disposition of reworked or failed lots of pistachios to AMS.
    4. Makes other miscellaneous changes to AMS' import regulations, 
including updating the agency and program names and contact 
information, and removing or updating other information that is out of 
date.

Costs and Benefits

    To the extent that this rule will increase efficiency and cost 
savings, it would benefit importers. Revising the reporting 
requirements will streamline the regulations and reduce the burden on 
the trade. The other changes finalized in this action will provide the 
import trade with accurate information.

Executive Orders 13563, 13175, 13771, 12866, and 12988

    USDA is issuing this final rule in conformance with Executive 
Orders 13563, 13175, 12866, and 13771. See OMB's Memorandum M-17-21 of 
April 5, 2017, containing guidance for implementing Executive Order 
13771, titled `Reducing Regulation and Controlling Regulatory Costs''' 
(February 2, 2017).

[[Page 12986]]

    This final rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This rule is not intended to have retroactive 
effect.

Background

    This final rule revises the reporting requirements for certain 
Irish potatoes, tomatoes, and onions regulated under part 980, the 
vegetable import regulations. This rule requires importers of those 
regulated commodities that have been certified by a designated 
governmental inspection service other than the Federal or Federal-State 
Inspection Service as meeting section 8e requirements to electronically 
enter the inspection certificate number and upload an electronic copy 
of the certificate to AMS. Currently, the Canadian Food Inspection 
Agency (CFIA) is the only designated non-Federal/Federal-State 
Inspection Service; therefore, references to the reporting requirement 
in this rule will hereinafter be described as ``CFIA'' or ``Canadian'' 
inspection certificates and/or inspection information.
    A proposed rule concerning this action was published in the Federal 
Register on December 6, 2016 (81 FR 87849). The proposed rule was made 
available through the internet by USDA and the Office of the Federal 
Register. A 30-day comment period ending January 5, 2017, was provided 
to allow interested persons to respond to the proposal. The import 
industry, USDA laboratories, and USDA-accredited laboratories are aware 
of ITDS and its goal to streamline processes. Members of the import 
industry have attended annual ITDS Trade Support Network plenary 
sessions conducted by the U.S. Government over the past few years. No 
comments were received on the proposed rule.
    While no comments were received on the proposed rule, USDA believes 
that industry and laboratories would benefit from additional time to 
adjust to the new electronic filing and reporting requirements; 
accordingly, USDA is setting six months from the publication of this 
final rule as the effective date for these changes.
    In the event an importer is unable to enter the CFIA inspection 
information electronically, he or she will be required to provide a 
copy of the certificate to AMS via email, mail, or facsimile.
    In addition, this rule changes two pistachio import reporting 
requirements in Sec.  999.600 of the specialty crop import regulations: 
The Imported Pistachios--Lot Notification report (form FV-249) and the 
Imported Pistachios--Rework and Failed Lot Disposition report (form FV-
251). Both forms have been previously approved for use by OMB under OMB 
No. 0581-0215, Pistachios Grown in California, Arizona, and New Mexico 
(although these two forms are included in the OMB information 
collection for the domestic pistachio marketing order, they are used 
strictly for reporting related to imported pistachios). The pistachio 
import regulations currently require that USDA or USDA-accredited 
laboratories complete a form FV-249 for all lots of imported pistachios 
that fail to meet aflatoxin requirements and submit the form to USDA, 
the CBP, and the importer who requested the aflatoxin test. The 
regulations also require that importers of pistachios complete and 
submit form FV-251 to USDA and CBP for lots that fail to meet aflatoxin 
requirements when the lots are reworked for further testing or, when 
not reworked, are exported, sold for non-human consumption, or 
destroyed.
    With the implementation of this rule, USDA or USDA-accredited labs 
will submit the form FV-249 electronically, reporting all aflatoxin 
test results (both ``meets'' and ``fails'') to USDA. In March 2017, the 
Office of Management and Budget (OMB) approved AMS' request to change 
the FV-249 form number to SC-249 to reflect the current program name 
(Specialty Crops), and references to the electronic form in this rule 
will be to SC-249. AMS has confirmed with CBP that it does not need to 
receive form SC-249, and importers already receive ``meets'' and 
``fails'' test results from the laboratories in the form of aflatoxin 
test certificates; therefore, the laboratories will electronically 
submit this form only to USDA. Importers will no longer be required to 
submit the form FV-251 because AMS has determined that information 
provided on this form is available from other sources. At the same 
time, AMS obtained OMB's approval for changes to the information 
collection currently approved under OMB No. 0581-0215, including 
removal of form FV-251 from the information collection. Providing for 
electronic submission of the form SC-249 and removing the requirement 
that importers submit the form FV-251 supports the ITDS initiative by 
streamlining processes and reducing the burden on America's import 
trade without compromising AMS' ability to ensure compliance with its 
import regulations.
    This rule makes other changes to the fruit, vegetable, and 
specialty crop import regulations in Sec. Sec.  944.400, 944.401, 
980.1, 980.117, 980.212, 999.1, 999.100, 999.300, and 999.400. These 
changes, which include updating agency and program names and contact 
information and removing or updating other information that is out of 
date, will help ensure the import regulations contain accurate 
information and align with the ITDS objective of streamlining import 
processes for the trade.
    This final rule does not remove any specific requirements related 
to the physical inspection of potatoes, onions, or tomatoes, only the 
manner in which inspection results are reported. All domestic and 
imported potatoes, onions, and tomatoes must still be inspected to 
ensure grade, quality and wholesomeness during the regulated period. 
All domestic growers of these commodities are also still required to 
register with the applicable marketing order committee or board. The 
marketing order committees/boards will still verify that inspections 
occur for domestically produced commodities. Importers are still 
required to register each entry by filing with CBP's Automated 
Commercial Environment (ACE). The AMS Marketing Order and Agreement 
Division (MOAD) will then verify whether imported products have met 
inspection requirements.

Certification by Canadian Food Inspection Agency (CFIA)

    In part 980, the following sections prescribe the grade, size, 
quality, and maturity requirements for imported vegetable commodities 
that are regulated under section 8e: Sec.  980.1(b) for potatoes, Sec.  
980.117(b) for onions, and Sec.  980.212(b) for tomatoes. Further, the 
following sections in part 980 specify the governmental inspection 
services that are designated to certify that grade, size, quality, and 
maturity requirements of the commodities have been met: Sec.  980.1(f) 
for potatoes, Sec.  980.117(e) for onions, and Sec.  980.212(e) for 
tomatoes. Part 980 also specifies that an inspection certificate issued 
by a designated government inspection service certifying that the 
potatoes, onions, and tomatoes meet the import requirements is required 
for all imports (Sec. Sec.  980.1(g), 980.117(f), and 980.212(f) for 
potatoes, onions, and tomatoes, respectively.
    As noted above, the vegetable import regulations specify those 
domestic and foreign government inspection services that are designated 
to certify that imported potatoes, onions, and tomatoes meet grade, 
size, quality, and maturity requirements. Currently, the only foreign 
designated governmental inspection service is CFIA.
    When importers have potatoes, onions, or tomatoes inspected in 
Canada prior to import into the United States, an inspection 
certificate is provided to the importer that certifies that the

[[Page 12987]]

commodity meets section 8e import requirements. These certificates are 
comprised of various formats, including a Certificate of Inspection for 
Fresh Fruits and Vegetables--Shipping Point (also known as Form CFIA/
ACIA 5314 or E2 and E3 Certificates) and an Export Document for C-PIQ 
Establishments--Fresh Fruits and Vegetables (also known as a C-PIQ 
form). CFIA issues C-PIQ forms to C-PIQ establishments that meet the 
requirements defined within the CFIA quality assurance program, known 
as ``Canadian Partners in Quality'' (C-PIQ). Currently, the C-PIQ 
program is only active for potatoes. All of these Canadian certificates 
contain similar information as required by the AMS vegetable import 
regulations, including the date of inspection, the name of the shipper, 
the commodity inspected, the quantity of the commodity covered by the 
certificate, and a statement indicating that the commodity meets the 
import requirements of section 8e.
    Currently, Canadian certificates that state that potatoes meet 
section 8e requirements are presented to CBP at the United States/
Canada border, prior to entry into the United States. AMS conducts 
periodic reviews at CFIA offices and potato handling facilities in 
various Canadian provinces during which inspectors from AMS' Specialty 
Crops Inspection (SCI) Division, as well as Compliance and Enforcement 
Specialists from AMS' MOAD, observe inspection processes and review 
records at traditional shipping points and maintained under the C-PIQ 
program for potatoes exported from Canada to the United States. 
However, importers have not been required to submit copies of the 
Canadian E2, E3, or C-PIQ certificates or otherwise provide proof of 
Canadian inspection to AMS.

Electronic Entry of Canadian Certificate Information in ACE

    CBP's ACE is the primary system through which the global trade 
community electronically files information about imports and exports so 
that admissibility into the United States may be determined and 
government agencies may monitor compliance. ACE is the platform that 
provides a ``single window'' through which the global trade community 
electronically files shipment data, instead of completing or submitting 
paper-based forms to report the same information to different 
government agencies. This ``single window'' concept is a key component 
of ITDS, a system that is designed to reduce the burden on America's 
import and export trade while still providing information to government 
agencies that is necessary for the United States to ensure compliance 
with its laws.
    In conjunction with the full implementation of the ITDS ``single 
window,'' CBP required that government agencies participating in the 
ITDS project, including AMS, ensure that regulations provide for the 
electronic entry of import and/or export information. This mandate was 
instituted through the Border Interagency Executive Council's (BIEC) 
effort to implement Executive Order 13659 and its governance structure 
to ensure coordination. CBP shares ACE data with Partnering Government 
Agencies (PGA) that have entered into a Memorandum of Understanding 
(MOU) with CBP. ACE data sharing MOUs with PGAs define and limit the 
scope and use of information shared pursuant to the PGA's respective 
authorities.
    AMS developed and in 2017 began deploying a new automated system 
called the Compliance and Enforcement Management System (CEMS) that 
interfaces with CBP's ACE system in support of ITDS. CEMS 
electronically links with the ACE system to create a ``pipeline'' 
through which data are transmitted between MOAD and CBP. CEMS validates 
information electronically entered by importers in ACE and transmits 
messages to CBP about whether a shipment may be released for 
importation into the United States.
    AMS has determined that: (1) Requiring importers of potatoes, 
tomatoes and onions to provide the inspection certificate number and a 
copy of the certificate issued by the non-USDA inspection agency; and 
(2) requiring the electronic filing of aflatoxin test results related 
to imported pistachios and eliminating the requirement to report 
disposition of reworked or failed lots of pistachios, as initially 
proposed, meet CBP's requirements for ITDS by: (1) Providing for the 
electronic entry in ACE of certification information for potatoes, 
onions, and tomatoes inspected by CFIA prior to import into the United 
States, and (2) providing for the electronic entry of aflatoxin test 
results related to imported pistachios into ACE. Data will be 
transmitted from CBP's ACE to AMS' CEMS, where it will be 
electronically validated. Upon validation, CEMS will transmit an 
electronic message back to ACE indicating the shipment is cleared for 
import into the United States. The changes to the vegetable import 
regulations will automate and streamline the entry and reporting 
process for importers while enhancing AMS' ability to ensure compliance 
with its import regulations.
    These changes will also provide an option for importers to provide 
AMS with a paper copy of a CFIA certificate, via email, mail, or 
facsimile, in the event an importer is unable to electronically provide 
the required certificate number and image in ACE.

Imported Pistachio Regulation Reporting Changes

    The pistachio import regulations provide that each pistachio sample 
drawn and prepared for aflatoxin testing by a USDA-authorized inspector 
be submitted to a USDA or USDA-accredited laboratory for analysis 
(Sec.  999.600(e)). Aflatoxins are a family of toxins producers by 
certain fungi that are found on agricultural products, including tree 
nuts. Aflatoxins are poisonous carcinogens. Lots that fail to meet the 
aflatoxin requirements currently must be reported by the laboratories 
to USDA, CBP, and the importer using an Imported Pistachios--Failed Lot 
Notification report (form FV-249), pursuant to Sec. Sec.  999.600(e), 
(g), and (h). Importers are also currently required to report the 
disposition of reworked and failed lots to USDA and CBP using an 
Imported Pistachios--Rework and Failed Lot Disposition report (form FV-
251), pursuant to Sec. Sec.  999.600(g) and (h). Both the form FV-249 
and form FV-251 were previously approved as paper forms.
    Section 999.600(f) requires that the laboratories provide an 
aflatoxin inspection certificate to importers that contains, among 
other things, a statement as to whether the lot meets or fails the 
import requirements under section 8e. Thus, all aflatoxin test results 
are provided to importers by the testing laboratories.
    Section 999.600 will be revised by changing the reporting 
requirements for laboratories (form SC-249) and importers (form FV-
251). USDA and USDA-accredited laboratories currently submit a paper 
form FV-249 to USDA, CBP, and the importer when a lot fails to meet the 
aflatoxin requirements of the pistachio import regulations. The testing 
laboratories are now meeting this requirement and are also voluntarily 
providing information to USDA about lots that meet aflatoxin 
requirements; in other words, the laboratories are providing all 
aflatoxin test results to USDA, not just failed lot notifications. 
Importers currently complete and submit a paper form FV-251 to report 
the disposition of reworked or failed lots to USDA and CBP.
    To streamline the regulations and eliminate the paper-based 
reporting process, AMS has converted the existing paper form to an 
electronic format, form

[[Page 12988]]

SC-249. The electronic format provides for the laboratories to report 
all aflatoxin test results to AMS, in line with the current practice. 
USDA's Science and Technology Program approves and accredits 
laboratories to perform chemical analysis of pistachios for aflatoxin 
content. The regulations will require accredited laboratories to submit 
aflatoxin test results to AMS using the electronic form SC-249, and 
USDA laboratories will also use the electronic form SC-249 to submit 
test results to AMS. AMS has determined that CBP does not require this 
test result information, and the laboratories already provide importers 
with certificates for all aflatoxin tests; therefore, the laboratories 
will be required to electronically submit form SC-249 to only USDA and 
not to CBP or importers.
    In addition to the changes to laboratory-reporting requirements, 
Sec.  999.600 will be revised to remove the requirement that importers 
report the disposition of reworked or failed lots to USDA and CBP using 
the Imported Pistachios--Rework and Failed Lot Disposition report (form 
FV-251). When this form was included in a proposed rule published in 
the Federal Register on October 11, 2011, (76 FR 65411) and implemented 
in a final rule published in the Federal Register on August 27, 2012, 
(77 FR 51686), AMS believed that the most effective way to ensure 
compliance with the rework and failed lot disposition requirements of 
the pistachio import regulations was to require importers to submit the 
form FV-251 with details about reworked, exported, sold for non-human 
consumption, or destroyed lots. Since that time, however, AMS has 
determined that the information provided on this form is available from 
other sources (for example, destruction information is available from 
AMS' SCI Division) or requires additional follow up with an importer. 
The requirements for rework and final disposition of failed lots is not 
changing; only the reporting associated with these requirements is 
changing. Importers will no longer be required to submit the form FV-
251 because AMS has determined that information provided on this form 
is available from other sources. In March 2017, AMS received approval 
from OMB to remove form FV-251 from the information collection package 
OMB No. 0581-0215.
    Accordingly, Sec. Sec.  999.600(e), (g), and (h) will be revised to 
reflect the changes to reporting noted above.

Other Changes

    To further ensure that the fruit, vegetable, and specialty crop 
import regulations provide accurate information to the import trade and 
in furtherance of streamlining processes in support of ITDS, the 
following changes will be made:
    Contact information for inspection offices and ports of entry, and 
references to importers making various advance arrangements for 
inspection services will be revised or removed from the fruit import 
regulations at Sec. Sec.  944.400(a) (designated inspection services 
and procedures), 944.401(c) (olives); the vegetable import regulations 
at Sec. Sec.  980.1(g)(1)(ii) (potatoes), 980.117(f)(3) (onions); 
980.212(f)(3) (tomatoes); and in the specialty crop regulations at 
Sec. Sec.  999.1(c)(1) (dates), 999.100(c)(4) (walnuts), 999.300(c)(3) 
(raisins), and 999.400(c)(2) (filberts). The contact information for 
individual inspection offices and ports of entry is currently out of 
date in many of these sections. Under ITDS, importers will 
electronically file initial requests for inspection (SC-357, Initial 
Inspection Request for Regulated Import Commodities), which will alert 
the appropriate inspection office and CBP that a regulated commodity 
will be arriving that will require inspection at the port of entry or 
at another location. This electronic process will provide the needed 
advance notice to the inspection service. AMS' SCI Division has amended 
its inspection application regulations (7 CFR parts 51 and 52) to 
provide for the electronic filing of the initial request for 
inspection, thereby meeting CBP's requirement that the regulations of 
agencies participating in ITDS be revised to provide for electronic 
filing of shipment entry data (81 FR 93571, December 21, 2016). This 
rule adds contact information (address, telephone number, and facsimile 
numbers) for the main SCI office in Washington, DC, in the event 
importers need any information about inspection services. This change 
also makes the fruit, vegetable, and specialty crop regulations more 
current and consistent.
    Administrative changes include updating the USDA agency and program 
names in Sec. Sec.  944.400(a) (designated inspection services and 
procedures) and 944.401(a)(5) and (c) (olives) in the fruit import 
regulations; 980.1(f) (potatoes), 980.117(e) (onions), and 980.212(e) 
(tomatoes) in the vegetable import regulations; and 999.600(h) 
(pistachios) in the specialty crop import regulations. Additionally, 
the word ``nectarines'' will be removed from Sec.  944.400(a) 
(designated inspection services and procedures) of the fruit import 
regulations. Nectarines were regulated in the past but are not 
currently regulated under the fruit import regulations and should not, 
therefore, be listed in this section.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
Chapter 35), AMS considered the information collection requirements 
necessary for form SC-357 (Initial Inspection Request for Regulated 
Imported Commodities) for importers to electronically complete to 
submit CFIA's inspection certificates and certificate numbers. It was 
deemed not to place an additional paperwork burden on importers. No 
changes in the information collection requirements pertaining to OMB 
No. 0581-0125 (Regulations Governing Inspection Certification of Fresh 
& Processed Fruits, Vegetables, & Other Products) are necessary as a 
result of this action. Should any changes become necessary, they would 
be submitted to OMB for approval.
    The information collection requirements for the form SC-249 (for 
imported pistachios) have been previously approved by OMB and assigned 
OMB No. 0581-0215 (Pistachios Grown in California, Arizona, and New 
Mexico). As noted earlier, form SC-249 is contained within the OMB 
information collection for the domestic pistachio marketing order but 
is used strictly for imported pistachios.
    In March 2017, OMB approved AMS' request for changes to the 
information collection currently approved under OMB No. 0581-0215, 
Pistachios Grown in California, Arizona and New Mexico, by renaming the 
existing form number and name to form SC-249, Notification of Aflatoxin 
Levels, to reflect the USDA program name change to Specialty Crops (SC) 
and the inclusion of all aflatoxin test results; providing for the 
electronic submission of form SC-249; and relaxing the submission 
requirements so that laboratories submit the form to only USDA, 
eliminating the need to also submit the form to CBP and importers. 
There are currently nine USDA-accredited laboratories that could 
potentially submit all aflatoxin test results to USDA instead of only 
failed test results using form SC-249. The number of respondents 
changed from 7 to 9 to cover all 9 laboratories completing the form, 
the estimated number of responses per respondent increased from 4 to 7 
to more accurately capture the number of times per year each laboratory 
typically submits the form to USDA, and the annual burden

[[Page 12989]]

hours increased as a result of the increased number of respondents and 
annual responses from 5.6 hours to 11.55 hours (this is a slight 
reduction from the 12.60 annual burden hours that were previously 
calculated and included in the proposed rule concerning this action 
that was published in the Federal Register on December 6, 2016, 81 FR 
87849). These changes necessitated by the rulemaking action were 
included in AMS' request to OMB to revise this information collection 
and were approved by OMB in March 2017. The revised form SC-249 was 
then included in the June 2017 three-year renewal of this information 
collection.

Executive Order 12866 and the Regulatory Flexibility Act

    A Regulatory Impact Analysis is required for significant rules by 
Executive Orders 12866 and 13563, which direct agencies to assess all 
costs and benefits of available regulatory alternatives. If regulation 
is necessary, then agencies must select the action that maximizes net 
benefits, including potential economic, environmental, public health 
and safety effects, and equity. This analysis examines the costs and 
benefits of this rule on importers, Customs brokers, and USDA. This 
document also addresses the requirement of Executive Order 13771 that 
agencies provide the best approximation of total costs and savings 
associated with a new or repealed regulation.

Need for Regulatory Action

    This final rule streamlines and automates import entry and 
reporting processes for the import trade as well as USDA and USDA-
accredited laboratories. These changes support the International Trade 
Data System (ITDS) initiative and will reduce the burden on the import 
industry while also enhancing AMS' ability to ensure compliance with 
its import regulations. In addition, this rule allows AMS to meet a 
U.S. Customs and Border Protection (CBP) requirement that all 
government agencies participating in the ITDS project update their 
regulations to provide for the electronic entry of import information. 
This rule also ensures that the import trade has access to accurate and 
up-to-date information in AMS' import regulations.
    Importers of Canadian potatoes, onions, and tomatoes that are 
certified by CFIA as meeting section 8e requirements are not currently 
required to provide AMS with proof of this certification prior to 
import. This rule mandates that AMS receive proof of CFIA certification 
through electronic entry of CFIA certificate numbers and electronic 
copies of certificates. Other agencies, such as CBP, already require 
importers to electronically enter information about shipments. The 
implementation of electronic filing capability via ACE and CEMS, will 
allow entries and associated paperwork to be transmitted to and 
verified electronically by AMS. Under this system, the importer would 
electronically file entries via ACE, which would then electronically 
transmit data to CEMS. Once the data is received, CEMS automatically 
records information regarding the entry and transmits an electronic 
notification to the inspection office identified by the filer via 
email. The ACE Secure Data Portal is covered by OMB Control number 
1651-0105 and is the primary means of importers and other trade filers 
to submit information to ACE and establish their user accounts. CBP 
published its Privacy Impact Analysis concurrent with a System of 
Records Notice on July 31, 2015. It is numbered DHS/CBP/PIA-003(b) and 
available at https://www.dhs.gov/sites/default/files/publications/privacy-piaupdate-cbp-ace-july2015.pdf) CBP and AMS established a 
Memorandum of Understanding, dated May 29, 2019, formalizing their 
respective roles in sharing information that supports ACE's ability to 
service the trade community.
    After the import undergoes a mandatory grading inspection, the 
inspection service electronically transmits pertinent inspection 
information to CEMS. If the inspection information identifies the entry 
as having met import requirements, CEMS automatically reconciles the 
inspection information against the entry information it previously 
stored. If the entry does not meet import requirements, a case is 
created in CEMS, which is electronically assigned to MOAD for 
investigation.
    This process reduces or eliminates the handling and processing of 
paper forms and adheres to the Paperwork Reduction Act of 1995. The 
previous paper-based filing method remains available for instances when 
the system may be temporarily off-line, or for filers with an inability 
to file electronically.
    This electronic filing option should streamline business 
operations, both for importers of these commodities, and for USDA, 
which will use the electronically submitted data to monitor compliance 
with section 8e regulations. Electronic submission of this certificate 
information would meet CBP's requirement to ensure that the regulations 
of those government agencies participating in the ITDS project, such as 
AMS, provide for the electronic submission of required data. This 
change should create little to no burden on importers while providing 
AMS with the ability to properly monitor imported vegetable shipments 
for compliance with the import regulations.
    This rule also changes the reporting requirements of aflatoxin test 
results of imported pistachios. Currently, USDA and USDA-accredited 
laboratories are required to submit documentation for all lots of 
imported pistachios that fail the test for aflatoxin to USDA, CBP, and 
the importer. The importer is also required to submit documentation to 
USDA and CBP for lots that fail the test for aflatoxin when lots are 
reworked for further testing, or are exported, sold for non-human 
consumption, or destroyed. This rule changes these requirements in that 
laboratories will electronically report all aflatoxin test results 
(both ``meets'' and ``fails'') to USDA. Importers already receive these 
results from laboratories through aflatoxin test certificates. CBP has 
reported that it does not need to receive documentation of aflatoxin 
test results. As all USDA and USDA-accredited laboratories already 
electronically supply USDA with all aflatoxin test results of imported 
pistachios, this rule should have little to no impact on these 
entities.
    This rule is expected to generate time and cost-savings for 
importers, Customs brokers, MOAD specialists, and USDA and USDA-
accredited laboratories. The benefits, assessed both qualitatively and 
quantitatively, are expected to outweigh any costs of this rule. The 
burden on the impacted entities is anticipated to be minimal.

Affected Entities

    The entities that are most likely to be affected by this rule 
primarily include importers of potatoes, tomatoes, and onions from 
Canada, and importers of pistachios. Also likely to be impacted are 
Customs brokers hired by importers to file the CFIA certification with 
CBP, MOAD specialists who are responsible to ensure that imports meet 
section 8e standards, and USDA and USDA-accredited laboratories that 
perform chemical analysis of aflatoxin levels in imported pistachios. 
All entities are expected to gain time and cost-savings as a result of 
this rule.
    Based on 2015 information from CBP, the most recent data available 
to AMS, USDA estimates that there are 25 importers of potatoes from 
Canada, 13 importers of onions from Canada, and 12 importers of 
tomatoes from Canada.

[[Page 12990]]

The Harmonized Tariff Schedule (HTS) codes of imports of potatoes, 
tomatoes, and onions that are subject to quality inspection are listed 
in Table 1. Using these codes, USDA retrieved data from the Global 
Agricultural Trade System (GATS), which is administered by the USDA's 
Foreign Agricultural Service (FAS).

 Table 1--HTS Codes for Imported Potatoes, Tomatoes, and Onions Subject
  to Quality Inspection in Accordance With Federal Marketing Orders and
                               Agreements
------------------------------------------------------------------------
            HTS codes                          Descriptions
------------------------------------------------------------------------
0701.90.5015....................  Potatoes, fresh, other: In immediate
                                   containers not over 1,200 kg net
                                   weight, russet or netted gem.
0701.90.5025....................  Potatoes, fresh, other: In immediate
                                   containers not over 1,200 kg net
                                   weight, red skin.
0701.90.5035....................  Potatoes, fresh other: In immediate
                                   containers not over 1,200 kg net
                                   weight, other.
0701.90.5045....................  Potatoes, fresh other, other, russet
                                   or netted gem.
0701.90.5055....................  Potatoes, fresh, other, other, red
                                   skin.
0701.90.5065....................  Potatoes, fresh, other, other.
0702.00.2099....................  Tomatoes, fresh, entered from 3/1-7/14
                                   or 9/1-11/14, other, other.
0702.00.4098....................  Tomatoes, fresh, entered 7/15-8/31,
                                   other, other.
0702.00.6099....................  Tomatoes, fresh, entered 11/15-last
                                   day of February, other, other.
0703.10.20......................  Onions, onion sets.
0703.10.30......................  Onions, pearl onions not over 16 mm in
                                   diameter.
0703.10.40......................  Onions, other.
------------------------------------------------------------------------
Source: CBP and Trade Automated Interface Requirements, September 2016.

    Table 2 shows three-year average import volumes for potatoes, 
tomatoes, and onions from Canada and from all U.S. trading partners for 
the years 2015 through 2017. As shown in the fourth column, almost all 
potatoes imported into the United States come from Canada. About 13 
percent of imported onions originate in Canada, as do 4 percent of 
tomatoes.

                 Table 2--Average Import Volume of Potatoes, Tomatoes, and Onions for 2015-2017
----------------------------------------------------------------------------------------------------------------
                                                                                                   Imports from
                                                                   Imports from    Total imports     Canada as
                            Commodity                              Canada (lbs.)      (lbs.)      share of total
                                                                                                     (percent)
----------------------------------------------------------------------------------------------------------------
Potatoes........................................................     777,061,999     777,115,645           99.99
Tomatoes........................................................      13,208,999     307,818,502            4.29
Onions..........................................................     152,630,386   1,144,195,001           13.34
----------------------------------------------------------------------------------------------------------------
Source: FAS-GATS.

    According to GATS data, potatoes account for approximately 28 
percent of U.S. fresh vegetable import volume from Canada. Canada is 
the second-largest trading partner of the United States in terms of 
fresh vegetable import volume, accounting for 18 percent of fresh 
vegetable imports.
    In-shell and shelled pistachio imports are also subject to quality 
inspection under section 8e requirements. Table 3 lists the HTS codes 
of imported pistachios subject to aflatoxin testing and the three-year 
average volume of imports from 2015 to 2017. Turkey is the largest 
supplier of both in-shell and shelled imported pistachios into the 
United States, supplying 74 percent and 66 percent of their totals, 
respectively. Altogether, Turkey accounts for 70 percent, on average, 
of total U.S. pistachio import volume. Greece supplies 14 percent of 
in-shell imports, and Italy supplies 14 percent of shelled imports.

 Table 3--HTS Codes for Imported Pistachios Subject to Aflatoxin Testing
                and Average Import Volumes for 2015-2017
------------------------------------------------------------------------
          HTS codes                   Description         Imports (lbs.)
------------------------------------------------------------------------
0802.51......................  Pistachios: In shell.....         525,803
0802.52......................  Pistachios: Shelled......         377,946
------------------------------------------------------------------------
Sources: CBP and Trade Automated Interface Requirements, September 2016;
  FAS-GATS.

    In addition to importers, Customs brokers are expected to be 
impacted by the change in reporting requirements as a result of this 
rule. Customs brokers are hired by importers to coordinate and file the 
paperwork that allows an import to enter the country. Customs brokers, 
who may be private individuals or corporations, are authorized by CBP 
to assist importers and exporters in meeting Federal requirements 
governing trade. According to CBP, there are approximately 14,454 
active licenses for Customs brokers in the United States.
    MOAD, along with USDA and USDA-accredited laboratories, are the 
final groups expected to be impacted by this rule. MOAD ensures that 
imports subject to section 8e regulations meet the same quality 
standards as the commodity produced domestically. MOAD oversees the 
compliance of 14 such commodities that are subject to section 8e 
regulations. As of January

[[Page 12991]]

2019, there were nine USDA and USDA-accredited laboratories that 
perform chemical analysis on aflatoxin levels of pistachios. One of 
these laboratories is the USDA facility in Blakely, Georgia. The other 
eight are privately-owned USDA-accredited laboratories all in 
California.

Baseline Definition

    In fiscal year 2018, CEMS received and processed 34,686 electronic 
filings of CFIA certification from CBP's ACE system. Importers and 
Customs brokers have commented that the multi-step paper-based filing 
process, which relied on the coordination of multiple parties, could 
take up to half a day to complete, compared to less than five minutes 
for filing electronically. Assuming an eight-hour workday, AMS 
concludes that CEMS may generate a time savings of four hours per 
filing for importers and Customs brokers. Applying this time savings to 
the number of electronic filings in CEMS in 2018 results in a total of 
138,744 hours saved by importers and Customs brokers for the year. The 
Bureau of Labor Statistics reports a mean hourly wage for Office and 
Administrative Support Occupations of $19.58 as of May 2018. 
Multiplying the total hours of time saved by importers and Customs 
brokers who used CEMS to file electronically in 2018 by the hourly wage 
of an Office and Administrative Support worker in 2018 leads to an 
estimated baseline cost savings of $2,716,608.
    In 2018 and prior to CEMS, MOAD required at least one full-time 
employee to manage the manual data-entry that accompanied the paper-
based filing system. The time of this full-time employee represents a 
cost to the USDA of $83,462, which is the 2018 total compensation 
(wages and benefits) for a full-time employee at the GS-8, Step 1 pay-
grade, adjusted for locality pay in the Washington, DC, region, and 
with benefits assumed to account for 39 percent of total compensation.

Cost-Savings of the Action

    Based on industry feedback, AMS estimates that approximately 25 to 
30 percent of Customs brokers and importers already used ACE to 
electronically file CFIA certification in fiscal year 2018, even though 
it was not yet mandatory. This speaks to importers' and Customs 
brokers' approval of CEMS and a willingness to file electronically. 
While businesses are generally drawn to practices that maximize 
efficiency and profits, the voluntary adoption of the electronic filing 
system by Customs brokers and importers has not been immediate. AMS 
attributes this to resistance to change. Since 2018, the portion of 
Customs brokers and importers to voluntarily utilize the system has 
increased to more than half. It may be true that over time, the 
incentives to maximize efficiency and profits would overcome resistance 
to change, and all Customs brokers and importers would voluntarily 
adopt the electronic filing system. AMS recognizes, therefore, that the 
estimated cost-savings attributed to this rule may be overstated in the 
analysis that follows.
    Customs brokers and importers have responded positively to the 
change in reporting requirements, particularly in regard to the 
integration of CEMS in creating and filing an Importer Exempt Commodity 
Certificate (SC-6 form). Customs brokers and importers report to have 
had little or no difficulty in creating an electronic copy of the form 
in CEMS and report that using CEMS is an improvement compared to the 
former paper-based system. Based on feedback from the industry, the 
cost for Customs brokers and importers to use CEMS to electronically 
file CFIA certification will be minimal.
    Assuming that the number of electronic filings is evenly 
distributed among importers and Customs brokers, and that the figure of 
34,686 electronic filings represents 25 to 30 percent of the greater 
population of filings, AMS estimates that the total number of filings 
in 2018, both electronic and paper-based, to be between 115,620 and 
138,744. Multiplying this range by the four hours required to complete 
the paper-based filing process results in 462,480 to 554,976 total 
hours required to complete the filing process prior to CEMS. The 
product of the total hours and the mean hourly wage of an Office and 
Administrative Support worker in 2018 is $9,055,358 to $10,866,430 in 
total costs to importers and Customs brokers to administer the paper-
based filing process prior to CEMS. This range represents the potential 
cost-savings for all importers and Customs brokers to use CEMS, 
including those that had already adopted its use in 2018. Subtracting 
the baseline hours and cost-savings of 138,744 hours and $2,716,608 
from the potential time and cost-savings for all importers and Customs 
brokers to use CEMS results in a range of additional time-savings of 
323,736 to 416,232 hours and cost-savings of $6,338,751 to $8,149,823. 
Additionally, the streamlining of the process of gathering information 
and harmonizing data through CEMS results in a cost-savings to USDA of 
$83,462.
    The requirement in this rule for USDA and USDA-accredited 
laboratories to report to USDA all test results of chemical analysis of 
aflatoxin levels in pistachios is expected to generate little to no 
change in costs or benefits for involved parties. This is because all 
nine laboratories currently provide USDA with both ``meets'' and 
``fails'' aflatoxin test results voluntarily. Converting the process 
from reporting results of failed lots only on paper to instead 
reporting all results electronically does not result in substantial 
change in burden.

Executive Order 13771

    In accordance with Executive Order 13771, this action has been 
designated as neither regulatory nor deregulatory as its resultant 
costs and savings are de minimis.

Alternatives to the Rule

    Regarding alternatives to this action, AMS determined that these 
changes to the regulations are needed to comply with the ITDS mandate 
and to provide AMS with information it requires to ensure compliance 
with its regulations. CBP is requiring that all government agencies 
partnering on the ITDS initiative (including AMS) update their 
regulations to provide for the electronic entry of import and export 
shipment data. Providing for the entry of certificate information in 
ACE for potatoes, tomatoes, and onions imported from Canada that have 
been certified by CFIA as meeting section 8e requirements enhances AMS' 
ability to monitor compliance while also meeting the objectives of ITDS 
to streamline processes for the import trade. In addition, changing the 
pistachio regulations by revising the reporting requirements will 
streamline the regulations and reduce the burden on the trade. The 
other changes finalized in this action will provide the import trade 
with accurate information.
    As this rule aims to streamline processes and improve efficiency, 
the only alternative considered was the status quo of a paper-based 
filing system and the reporting of only failed lots from aflatoxin 
tests to AMS. AMS believes that the changes in reporting requirements 
in this rule represent the best alternative to maximize benefits to 
importers, Customs brokers, MOAD specialists, and USDA and USDA-
accredited laboratories.

Regulatory Flexibility Analysis

    Pursuant to the requirements set forth in the Regulatory 
Flexibility Act (5 U.S.C. 601-612), AMS has considered the economic 
impact of this action on small entities. AMS has prepared this final 
Regulatory Flexibility Analysis, the

[[Page 12992]]

purpose of which is to fit regulatory actions to the scale of 
businesses subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened.

Need for Regulation

    Importers of Canadian potatoes, onions, and tomatoes that are 
certified by CFIA as meeting section 8e standards are not currently 
required to submit this certification to AMS prior to import. By 
mandating that AMS receive proof of CFIA certification through 
electronic entry of CFIA certificate numbers and electronic copies of 
certificates, AMS can better ensure compliance of imports with section 
8e standards.
    Similarly, the requirement in this rule for USDA and USDA-
accredited laboratories to electronically submit all aflatoxin test 
results to USDA will replace outdated reporting practices and promote 
greater efficiency. Currently, these laboratories are required to 
submit documentation for all lots of imported pistachios that fail the 
test for aflatoxin to USDA, CBP, and the importer. The importer is also 
required to submit documentation to USDA and CBP for lots that fail the 
test for aflatoxin when lots are reworked for further testing, or are 
exported, sold for non-human consumption, or destroyed. This rule 
eliminates the need for these documents, replacing them with the 
requirement that laboratories electronically report all aflatoxin test 
results (both ``meets'' and ``fails'') to USDA. Importers already 
receive these results from laboratories and CBP has reported that it 
does not need to receive documentation of aflatoxin test results.

Objectives of the Action

    This final rule changes the import regulations for potatoes, 
onions, and tomatoes by requiring proof of CFIA certification through 
electronic entry of CFIA certificate numbers and electronic copies of 
certificates. Prior to import into the United States, importers must 
enter into CBP's ACE system the certificate number and upload an 
electronic image of the certificate for those shipments certified by 
CFIA as meeting section 8e requirements. This information is then 
transmitted through CEMS to AMS. If an importer is unable to provide 
this information electronically in ACE, a copy of the certificate must 
accompany the shipment at entry into the country, and the importer must 
also submit a copy of the certificate to AMS via email, mail, or 
facsimile.
    This final rule also changes the pistachio import regulations by 
modifying the reporting requirements for USDA and USDA-accredited 
laboratories that perform chemical analysis of aflatoxin levels in 
imported pistachios. The regulations will require these laboratories to 
submit all aflatoxin test results to USDA instead of only the results 
of failed lots.

Legal Basis for the Action

    This final rule is issued under section 8e of the Agricultural 
Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674), 
hereinafter referred to as the ``Act.'' Section 8e provides that 
whenever certain commodities are regulated under Federal marketing 
orders, imports of those commodities into the United States are 
prohibited unless they meet the same or comparable grade, size, 
quality, and/or maturity requirements as those in effect for the 
domestically-produced commodities. The Act also authorizes the U.S. 
Department of Agriculture (USDA) to perform inspections on those 
imported commodities and to certify whether those requirements have 
been met.
    Parts 944, 980, and 999 of title 7 of the Code of Federal 
Regulations (CFR) specify inspection, certification, and reporting 
requirements for imported commodities regulated under section 8e, 
including the governmental inspection services that are authorized to 
perform certification.
    There are no administrative procedures that must be exhausted prior 
to any judicial challenge to the provisions of import regulations 
issued under section 8e of the Act.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap or conflict with this final rule.
    A 30-day comment period ending January 5, 2017, was provided to 
allow interested persons to respond to the proposal. The import 
industry, USDA laboratories, and USDA-accredited laboratories are aware 
of ITDS and its goal to streamline processes. Members of the import 
industry have attended annual ITDS Trade Support Network plenary 
sessions conducted by the U.S. Government over the past few years. No 
comments were received on the proposed rule; accordingly, no changes 
will be made to the rule as proposed.

Potentially Affected Small Entities

    Importers of potatoes, tomatoes, onions, and pistachios may be 
engaged in a variety of different industries and in varying segments of 
the supply chain. The North American Industry Classification System 
(NAICS) categorizes industries based on their activities. Table 5 lists 
potential industries with which importers may be involved that may be 
impacted by this rule, along with information about their sizes.

                               Table 5--Profiles of Potentially Impacted Importers
----------------------------------------------------------------------------------------------------------------
                                                                    Firms with    Firms with 100- Firms with 500
          NAICS codes            NAICS industry    Total number    less than 100   499 employees   employees and
                                   description       of firms        employees                         more
----------------------------------------------------------------------------------------------------------------
Subsector 311--Food
 Manufacturing
    311411....................  Frozen Fruit,                153             102              24              27
                                 Juice and
                                 Vegetable
                                 Manufacturing.
    311423....................  Dried and                    181             142              20              19
                                 Dehydrated Food
                                 Manufacturing.
    311911....................  Roasted Nuts and             233             184              29              20
                                 Peanut Butter
                                 Manufacturing.
Subsector 424--Merchant
 Wholesalers, Nondurable Goods
    424410....................  General Line               2,443           2,300              80              63
                                 Grocery
                                 Merchant
                                 Wholesalers.
    424420....................  Packaged Frozen            2,570           2,377             113              80
                                 Food Merchant
                                 Wholesalers.
    424480....................  Fresh Fruit and            4,415           4,157             208              50
                                 Vegetable
                                 Merchant
                                 Wholesalers.

[[Page 12993]]

 
Subsector 445--Food and
 Beverage Stores
    445110....................  Supermarkets and          41,264          39,827           1,118             319
                                 Other Grocery
                                 (except
                                 Convenience)
                                 Stores.
    445292....................  Confectionery              2,132           2,084              35              13
                                 and Nut Stores.
----------------------------------------------------------------------------------------------------------------
Source: U.S. Census Bureau--2016 County Business Patterns.

    Potatoes, tomatoes, onions, and pistachios may be imported for 
further processing or be re-entered into the stream of commerce as a 
fresh market product. For example, an importer of potatoes in the food 
manufacturing industry (Subsector 311) may utilize imports for frozen 
French fries or dehydrated potatoes. An importer may also purchase 
fresh potatoes to sell to restaurants as a wholesaler (Subsector 424), 
or to sell in a supermarket or grocery store (Subsector 445). According 
to 2016 data from the U.S. Census Bureau, most firms in the industries 
listed in Table 5 employ fewer than 100 people. Time-savings from the 
automation that CEMS provides is expected to particularly benefit 
importers with a smaller workforce.
    The Small Business Administration (SBA) determines standards by 
which entities are considered to be ``small''. These standards may be 
determined by the average annual receipts or the average employment of 
a firm. Table 6 shows the small business standards for the industries 
in which importers of potatoes, tomatoes, onions, and pistachios may be 
employed. Table 6 also shows the portion of businesses in these 
industries likely to be considered ``small'', using the information in 
Table 5.

                       Table 6--Industry Comparison With SBA Standards of Small Businesses
----------------------------------------------------------------------------------------------------------------
                                                                        SBA size
                                   NAICS industry       SBA size      standards in       Portion of  industry
          NAICS codes                description      standards in      number of         estimated  to meet
                                                         dollars        employees              standard
----------------------------------------------------------------------------------------------------------------
Subsector 311--Food
 Manufacturing
    311411.....................  Frozen Fruit,       ..............           1,000  82% (at least).
                                  Juice and
                                  Vegetable
                                  Manufacturing.
    311423.....................  Dried and           ..............             750  90% (at least).
                                  Dehydrated Food
                                  Manufacturing.
    311911.....................  Roasted Nuts and    ..............             750  91% (at least).
                                  Peanut Butter
                                  Manufacturing.
Subsector 424--Merchant
 Wholesalers, Nondurable Goods
    424410.....................  General Line        ..............             250  94% (at least).
                                  Grocery Merchant
                                  Wholesalers.
    424420.....................  Packaged Frozen     ..............             200  92% (at least).
                                  Food Merchant
                                  Wholesalers.
    424480.....................  Fresh Fruit and     ..............             100  94% (at least).
                                  Vegetable
                                  Merchant
                                  Wholesalers.
Subsector 445--Food and
 Beverage Stores
    445110.....................  Supermarkets and       $32,500,000  ..............  Likely the majority.
                                  Other Grocery
                                  (except
                                  Convenience)
                                  Stores.
    445292.....................  Confectionery and        7,500,000  ..............  Likely the majority.
                                  Nut Stores.
----------------------------------------------------------------------------------------------------------------
Sources: U.S. Small Business Administration Size Standards Table (Oct. 2017); U.S. Census Bureau--2016 County
  Business Patterns; U.S. Census Bureau--2016 Monthly Retail Trade Survey.

    The industries listed in Table 6 under NAICS Code Subsectors 311 
and 424 have small business standards based on number of employees. 
Using the information in Table 5 on business firm size, AMS concludes 
that most importers of potatoes, tomatoes, onions, and pistachios in 
these industries are likely considered ``small''. The industries listed 
in Table 6 under NAICS Code Subsector 445 have small business standards 
based on average annual receipts. The U.S. Census Bureau, 
unfortunately, does not publish retail sales data specific to six-digit 
NAICS Code. AMS, therefore, used the business firm size data in Table 5 
to estimate sales by businesses with NAICS Codes 445110 and 445292 
based on the retail sales data of all businesses under NAICS Code 
Subsector 445. In this estimate, AMS assumes retail sales to be evenly 
spread among all industries falling within NAICS Code Subsector 445. 
The results are average annual sales receipts of $1.15 million for 
Confectionary and Nut Stores, and $14.5 million in average annual sales 
receipts for Supermarkets and Other Grocery Stores. The majority of 
businesses in these industries are, therefore, likely ``small''.
    As of January 2019, there were a total of nine USDA and USDA-
accredited laboratories that perform chemical analysis on aflatoxin 
levels of pistachios. One of these laboratories is the USDA facility in 
Blakely, Georgia. As a government entity, it is not subject to RFA 
analysis. The other eight are privately-owned USDA-accredited 
laboratories in California. The SBA classifies testing laboratories 
(NAICS code 541380) as small businesses if they receive no more than an 
average of $15 million annually. AMS could find no data on the average 
annual receipts of testing laboratories and is, therefore,

[[Page 12994]]

unable to determine whether these eight USDA-accredited laboratories 
would be considered small businesses under the SBA standards.

Alternatives To Minimize Impacts of Rule

    Regarding alternatives to this action, AMS determined that these 
changes to the regulations are needed to comply with the ITDS mandate 
and to provide AMS with information it requires to ensure compliance 
with its regulations. CBP is requiring that all government agencies 
partnering on the ITDS initiative (including AMS) update their 
regulations to provide for the electronic entry of import and export 
shipment data. Providing for the entry of certificate information in 
ACE for potatoes, tomatoes, and onions imported from Canada that have 
been certified by CFIA as meeting section 8e requirements enhances AMS' 
ability to monitor compliance while also meeting the objectives of ITDS 
to streamline processes for the import trade. In addition, changing the 
pistachio regulations by revising the reporting requirements will 
streamline the regulations and reduce the burden on the trade. The 
other changes finalized in this action will provide the import trade 
with accurate information.
    AMS is committed to complying with the E-Government Act to promote 
the use of the internet and other information technologies to provide 
increased opportunities for citizen access to Government information 
and services, and for other purposes.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap or conflict with this final rule.
    AMS conducted extensive stakeholder outreach as part of this 
rulemaking. During the summer of 2015, AMS staff members participated 
in 13 outreach sessions to the U.S. import industry. The sessions took 
place both in person as well as via webcast. The goal of these sessions 
was to introduce the new ACE system and the government agencies that 
are participating in the program. USDA presented extensive overviews of 
the proposed regulations and encouraged the trade to participate by 
creating their own companion software. Additionally, through 2017 and 
2018, AMS staff coordinated extensively with CBP to prepare for the 
changes detailed in this Rule.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/rules-regulations/moa/small-businesses. Any questions 
about the compliance guide should be sent to Richard Lower at the 
previously mentioned address in the FOR FURTHER INFORMATION CONTACT 
section.

Civil Rights Impact Analysis

    AMS has reviewed this final rule in accordance with Departmental 
Regulation 4300-4, Civil Rights Impact Analysis (CRIA), to identify and 
address any major civil rights impacts the rule might have on any 
protected groups of people. After a careful review of the rule's intent 
and provisions, AMS has determined that this rule would not 
disproportionately or adversely impact any importers of commodities 
regulated under section 8e who are members of any protected group or 
employees of any USDA or USDA-accredited laboratories who are members 
of any protected group.

List of Subjects

7 CFR Part 944

    Avocados, Food grades and standards, Grapefruit, Grapes, Imports, 
Kiwifruit, Olives, Oranges.

7 CFR Part 980

    Food grades and standards, Imports, Marketing agreements, Onions, 
Potatoes, Tomatoes.

7 CFR Part 999

    Dates, Filberts, Food grades and standards, Imports, Nuts, 
Pistachios, Prunes, Raisins, Reporting and recordkeeping requirements, 
Walnuts.

    For the reasons set forth in the preamble, 7 CFR parts 944, 980, 
and 999 are amended as follows:

0
1. The authority citation for 7 CFR parts 944, 980, and 999 continues 
to read as follows:

    Authority:  7 U.S.C. 601-674.

PART 944--FRUITS; IMPORT REGULATIONS

0
2. Revise Sec.  944.400(a) to read as follows:


Sec.  944.400   Designated inspection services and procedure for 
obtaining inspection and certification of imported avocados, 
grapefruit, kiwifruit, oranges, prune variety plums (fresh prunes), and 
table grapes regulated under section 8e of the Agricultural Marketing 
Agreement Act of 1937, as amended.

    (a) The Federal or Federal-State Inspection Service, Specialty 
Crops Program, Agricultural Marketing Service, United States Department 
of Agriculture is hereby designated as the governmental inspection 
service for the purpose of certifying the grade, size, quality, and 
maturity of avocados, grapefruit, oranges, prune variety plums (fresh 
prunes), and table grapes that are imported into the United States. 
Agriculture and Agri-Food Canada is also designated as a governmental 
inspection service for the purpose of certifying grade, size, quality 
and maturity of prune variety plums (fresh prunes) only. Inspection by 
the Federal or Federal-State Inspection Service or the Agriculture and 
Agri-Food Canada, with appropriate evidence thereof in the form of an 
official inspection certificate, issued by the respective services, 
applicable to the particular shipment of the specified fruit, is 
required on all imports. Inspection and certification by the Federal or 
Federal-State Inspection Service will be available upon application in 
accordance with the Regulations Governing Inspection, Certification and 
Standards for Fresh Fruits, Vegetables, and Other Products (7 CFR part 
51). For further information about Federal or Federal-State inspection 
services, contact Specialty Crops Inspection Division, Specialty Crops 
Program, AMS, USDA, 1400 Independence Avenue SW, STOP 0240, Washington, 
DC 20250-0237; telephone (202) 720-5870; fax (202) 720-0393.
* * * * *

0
3. In Sec.  944.401, revise paragraphs (a)(5) and (c) to read as 
follows:


Sec.  944.401   Olive Regulation 1.

    (a) * * *
    (5) USDA Inspector means an inspector of the Specialty Crops 
Inspection Division, Specialty Crops Program, Agricultural Marketing 
Service, U.S. Department of Agriculture, or any other duly authorized 
employee of the Department.
* * * * *
    (c) The Specialty Crops Inspection Division, Specialty Crops 
Program, Agricultural Marketing Service, U.S. Department of 
Agriculture, is hereby designated as the governmental inspection 
service for the purpose of certifying the grade and size of processed 
olives from imported bulk lots for use in canned ripe olives and the 
grade and size of imported canned ripe olives. Inspection by said 
inspection service with appropriate evidence thereof in the form of an 
official inspection certificate, issued by the service and applicable 
to the particular lot of olives, is required. With respect to imported 
bulk olives, inspection and certification shall be completed prior to 
use as packaged ripe olives. With respect to canned ripe olives, 
inspection and certification shall be completed prior to importation, 
unless imports arrive by vessel in which case the date of inspection 
and

[[Page 12995]]

certification may be after the date of importation. Any lot of olives 
which fails to meet the import requirements and is not being imported 
for purposes of contribution to a charitable organization or processing 
into oil may be exported or disposed of under the supervision of the 
Specialty Crops Inspection Division, Specialty Crops Program, AMS, 
USDA, with the cost of certifying the disposal borne by the importer. 
Such inspection and certification services will be available, upon 
application, in accordance with the applicable regulations governing 
the inspection and certification of Processed Fruits and Vegetables, 
Processed Products Thereof, and Certain Other Processed Food Products 
(7 CFR part 52). For questions about inspection services or for further 
assistance, contact: Specialty Crops Inspection Division, Specialty 
Crops Program, AMS, USDA, 1400 Independence Avenue SW, Room 1536-S, 
STOP 0240, Washington, DC 20250-0237; telephone (202) 720-5870; fax 
(202) 720-0393.
* * * * *

PART 980--VEGETABLES; IMPORT REGULATIONS

0
4. In Sec.  980.1, revise paragraphs (f) and (g)(1)(i) and (ii) to read 
as follows:


Sec.  980.1   Import regulations; Irish potatoes.

* * * * *
    (f) Designation of governmental inspection services. The Federal or 
Federal-State Inspection Service, Specialty Crops Program, Agricultural 
Marketing Service, U.S. Department of Agriculture, and the Food of 
Plant Origin Division, Plant Products Directorate, Canadian Food 
Inspection Agency, are hereby designated as governmental inspection 
services for the purpose of certifying the grade, size, quality, and 
maturity of Irish potatoes that are imported, or to be imported, into 
the United States under the provisions of Sec.  608e of the Act.
    (g) * * *
    (1)(i) Inspection and certification by the Federal or Federal-State 
Inspection Service will be available and performed in accordance with 
the rules and regulations governing certification of fresh fruits, 
vegetables, and other products (7 CFR part 51), and each lot shall be 
made available and accessible for inspection as provided therein. Cost 
of inspection and certification shall be borne by the applicant. For 
questions about inspection services or for further assistance, contact: 
Specialty Crops Inspection Division, Specialty Crops Program, AMS, 
USDA, 1400 Independence Avenue SW, Room 1536-S, STOP 0240, Washington, 
DC 20250-0237; telephone (202) 720-5870; fax (202) 720-0393.
    (ii) If certification is provided by a designated governmental 
inspection service other than the Federal or Federal-State Inspection 
Service, in accordance with 980.1(f), an importer shall electronically 
transmit to USDA, prior to entry, the certificate number and an 
electronic image of the certificate using the U.S. Customs and Border 
Protection's Automated Commercial Environment system. If this 
information is not provided electronically prior to entry, a paper copy 
of the certificate must accompany the shipment at the time of entry, 
and a copy of the certificate must be submitted by email or mail to the 
Marketing Order and Agreement Division, Specialty Crops Program, AMS, 
USDA, 1400 Independence Avenue SW, STOP 0237, Washington, DC 20250-
0237; telephone (888) 551-3523; or email [email protected].
* * * * *

0
5. In Sec.  980.117, revise paragraphs (e) and (f)(2) and (3) to read 
as follows:


Sec.  980.117   Import regulations; onions.

* * * * *
    (e) Designation of governmental inspection service. The Federal or 
Federal-State Inspection Service, Specialty Crops Program, Agricultural 
Marketing Service, U.S. Department of Agriculture, and the Food of 
Plant Origin Division, Plant Products Directorate, Canadian Food 
Inspection Agency, are hereby designated as governmental inspection 
services for the purpose of certifying the grade, size, quality, and 
maturity of onions that are imported, or to be imported, into the 
United States under the provisions of section 8e of the Act.
    (f) * * *
    (2) Inspection and certification by the Federal or Federal-State 
Inspection Service will be available and performed in accordance with 
the rules and regulations governing certification of fresh fruits, 
vegetables and other products (7 CFR part 51). Each lot shall be made 
available and accessible for inspection as provided therein. Cost of 
inspection and certification shall be borne by the applicant. For 
questions about inspection services or for further assistance, contact: 
Specialty Crops Inspection Division, Specialty Crops Program, AMS, 
USDA, 1400 Independence Avenue SW, Room 1536-S, STOP 0240, Washington, 
DC 20250-0237; telephone (202) 720-5870; fax (202) 720-0393.
    (3) If certification is provided by a designated governmental 
inspection service other than the Federal or Federal-State Inspection 
Service, in accordance with 980.117(e), an importer shall 
electronically transmit to USDA, prior to entry, the certificate number 
and an electronic image of the certificate using the U.S. Customs and 
Border Protection's Automated Commercial Environment system. If this 
information is not provided electronically prior to entry, a paper copy 
of the certificate must accompany the shipment at the time of entry, 
and a copy of the certificate must be submitted by email or mail to the 
Marketing Order and Agreement Division, Specialty Crops Program, AMS, 
USDA, 1400 Independence Avenue SW, STOP 0237, Washington, DC 20250-
0237; telephone (888) 551-3523; email [email protected]; or fax 
(202) 720-5698.
* * * * *

0
6. In Sec.  980.212, revise paragraphs (e) and (f)(2) and (3) to read 
as follows:


Sec.  980.212   Import regulations; tomatoes.

* * * * *
    (e) Designation of governmental inspection service. The Federal or 
Federal-State Inspection Service, Specialty Crops Program, Agricultural 
Marketing Service, U.S. Department of Agriculture, and the Food of 
Plant Origin Division, Plant Products Directorate, Canadian Food 
Inspection Agency, are hereby designated as governmental inspection 
services for the purpose of certifying the grade, size, quality, and 
maturity of tomatoes that are imported, or to be imported, into the 
United States under the provisions of section 8e of the Act.
    (f) * * *
    (2) Inspection and certification by the Federal or Federal-State 
Inspection Service will be available and performed in accordance with 
the rules and regulations governing certification of fresh fruits, 
vegetables and other products (7 CFR part 51). Each lot shall be made 
available and accessible for inspection as provided therein. Cost of 
inspection and certification shall be borne by the applicant. For 
questions about inspection services or for further assistance, contact: 
Specialty Crops Inspection Division, Specialty Crops Program, AMS, 
USDA, 1400 Independence Avenue SW, Room 1536-S, STOP 0240, Washington, 
DC 20250-0237; telephone (202) 720-5870; fax (202) 720-0393.
    (3) If certification is provided by a designated governmental 
inspection service other than the Federal or Federal-State Inspection 
Service, in accordance with 980.212(e), an importer shall 
electronically transmit to USDA,

[[Page 12996]]

prior to entry, the certificate number and an electronic image of the 
certificate using the U.S. Customs and Border Protection's Automated 
Commercial Environment system. If this information is not provided 
electronically prior to entry, a paper copy of the certificate must 
accompany the shipment at the time of entry, and a copy of the 
certificate must be submitted by email or mail to the Marketing Order 
and Agreement Division, Specialty Crops Program, AMS, USDA, 1400 
Independence Avenue SW, STOP 0237, Washington, DC 20250-0237; telephone 
(888) 551-3523; email [email protected]; or fax (202) 720-5698.
* * * * *

PART 999--SPECIALTY CROPS; IMPORT REGULATIONS


Sec.  999.100   [Amended]

0
7. In Sec.  999.100, amend paragraph (c)(4) by removing the last 
sentence.

0
8. In Sec.  999.300, revise paragraph (c)(3) to read as follows:


Sec.  999.300   Regulation governing importation of raisins.

* * * * *
    (c) * * *
    (3) Whenever raisins are offered for inspection, the applicant 
shall furnish any labor and pay any costs incurred in moving and 
opening containers as may be necessary for proper sampling and 
inspection. The applicant shall also furnish the USDA inspector the 
entry number and such other identifying information for each lot as the 
inspector may request.
* * * * *

0
9. In Sec.  999.400, revise paragraph (c)(2) to read as follows:


Sec.  999.400   Regulation governing the importation of filberts.

* * * * *
    (c) * * *
    (2) Inspection. Inspection shall be performed by USDA inspectors in 
accordance with the Regulations Governing the Inspection and 
Certification of Fresh Fruits and Vegetables and Related Products (7 
CFR part 51). The cost of each such inspection and related 
certification shall be borne by the applicant. Whenever filberts are 
offered for inspection, the applicant shall furnish any labor and pay 
any costs incurred in moving and opening containers as may be necessary 
for proper sampling and inspection. The applicant shall also furnish 
the USDA inspector the entry number and such other identifying 
information for each lot as the inspector may request. Inspection must 
be completed prior to the importation, unless imported by vessel, in 
which case for filberts, the date of release may be used.
* * * * *

0
10. Amend Sec.  999.600 by revising paragraphs (e)(2) and (3), (g), and 
(h) to read as follows:


Sec.  999.600   Regulation governing the importation of pistachios.

* * * * *
    (e) * * *
    (2) Lots that require a single test sample will be certified as 
``negative'' on the aflatoxin inspection certificate if the sample has 
an aflatoxin level at or below 15 ppb. If the aflatoxin level is above 
15 ppb, the lot fails. The laboratory shall electronically submit the 
results to USDA as described in paragraph (h) of this section.
    (3) Lots that require two test samples will be certified as 
``negative'' on the aflatoxin inspection certificate if Test Sample #1 
has an aflatoxin level at or below 10 ppb. If the aflatoxin level of 
Test Sample #1 is above 20 ppb, the lot fails and the laboratory shall 
electronically submit the results to USDA as described in paragraph (h) 
of this section. If the aflatoxin level of Test Sample #1 is above 10 
ppb and at or below 20 ppb, the laboratory may, at the importer's 
discretion, analyze Test Sample #2 and average the test results of Test 
Samples #1 and #2. Alternately, the importer may elect to withdraw the 
lot from testing, rework the lot, and resubmit it for testing after 
reworking. If the importer directs the laboratory to proceed with the 
analysis of Test Sample #2, a lot will be certified as negative to 
aflatoxin and the laboratory shall issue an aflatoxin inspection 
certificate if the averaged result of Test Samples #1 and #2 is at or 
below 15 ppb. If the average aflatoxin level of Test Samples #1 and #2 
is above 15 ppb, the lot fails. The laboratory shall electronically 
submit the results to USDA as described in paragraph (h) of this 
section.
* * * * *
    (g) Failed lots/rework procedure. Any lot or portion thereof that 
fails to meet the import requirements prior to or after reconditioning 
may be exported, sold for non-human consumption, or disposed of under 
the supervision the Federal or Federal-State Inspection Programs, with 
the costs of certifying the disposal of such lot paid by the importer.
    (1) Inshell rework procedure for aflatoxin. If inshell rework is 
selected as a remedy to meet the aflatoxin requirements of this part, 
then 100 percent of the product within that lot shall be removed from 
the bulk and/or retail packaging containers and reworked to remove the 
portion of the lot that caused the failure. Reworking shall consist of 
mechanical, electronic, or manual procedures normally used in the 
handling of pistachios. The reworked lot shall be sampled and tested 
for aflatoxin as specified in paragraphs (d) and (e) of this section, 
except that the lot sample size and the test sample size shall be 
doubled. If, after the lot has been reworked and tested, it fails the 
aflatoxin test for a second time, the lot may be shelled and the 
kernels reworked, sampled, and tested in the manner specified for an 
original lot of kernels, or the failed lot may be exported, used for 
non-human consumption, or otherwise disposed of.
    (2) Kernel rework procedure for aflatoxin. If pistachio kernel 
rework is selected as a remedy to meet the aflatoxin requirements of 
this part, then 100 percent of the product within that lot shall be 
removed from the bulk and/or retail packaging containers and reworked 
to remove the portion of the lot that caused the failure. Reworking 
shall consist of mechanical, electronic, or manual procedures normally 
used in the handling of pistachios. The reworked lot shall be sampled 
and tested for aflatoxin as specified in paragraphs (d) and (e) of this 
section.
    (3) Failed lot reporting. If a lot fails to meet the aflatoxin 
requirements of this part, the testing laboratory shall electronically 
submit the results to USDA as described in paragraph (h) of this 
section within 10 working days of the test failure. This information 
must be submitted each time a lot fails aflatoxin testing.
    (h) Reports and Recordkeeping: Notification of Aflatoxin Levels. 
Each USDA or USDA-accredited laboratory shall notify the Marketing 
Order and Agreement Division, Specialty Crops Program, AMS, USDA of all 
aflatoxin test results for all lots by electronically submitting this 
form within 10 days of testing through a format specified by the 
Secretary.
* * * * *

    Dated: February 21, 2020.
Bruce Summers,
Administrator, Agricultural Marketing Service.
[FR Doc. 2020-03895 Filed 3-5-20; 8:45 am]
 BILLING CODE 3410-02-P