Finalized US sanitary rule requires more scrutiny from food shippers

Lara L. Sowinski | Jul 10, 2016 9:00AM EDT

Shipper readiness and government enforcement are only two of the questions surrounding new FDA regulations.

On April 6, the U.S. Food and Drug Administration issued a final rule establishing requirements for shippers, loaders, carriers by motor vehicle and rail, and receivers engaged in the transportation of food, iluding animal food, to use sanitary transportation practices to ensure the safety of the food they transport. The final rule is part of the FDA’s larger effort to focus on prevention of food safety problems throughout the supply chain, including the implementation of the Sanitary Food Transportation Act of 2005 and the Food Safety Modernization Act of 2011.

The final rule’s requirements regarding temperature monitoring and recordkeeping are a primary concern for parties involved in the global cold chain.

Christopher Ripple, an associate at McGuireWoods who focuses on litigation and regulatory matters as a member of the firm’s Food and Beverage, FDA Regulatory and Transportation industry teams, weighs in on the FDA’s efforts to keep food safe in the supply chain.

Cool Cargoes: What are some of the most significant changes between the FDA’s proposed Sanitary Transportation of Human and Animal Food rule and the final rule?

Ripple: The final rule certainly resembles the proposed rule in terms of its overall direction. But there also are some significant changes in the final rule. At a high level, the FDA has refocused the final rule on transportation practices that could pose a threat to food safety. The proposed rule focused more broadly on practices that might lead to spoilage or make the food less marketable, but not necessarily dangerous to eat. The final rule brings the focus back to safety risk.

One of the ways the final rule refocuses on food safety is through more flexible temperature controls. For example, a major industry concern with the proposed rule was that it might have required continuous temperature monitoring throughout the shipment’s transportation along with the production of temperature records for every shipment, even if those records were not requested. The final rule gives carriers and shippers more flexibility to determine what the appropriate temperature should be for a particular shipment, and how carriers can demonstrate compliance. Receivers will still need to check for potential temperature abuse when the food arrives at the destination, and the receiver can still request confirmation that temperature controls have been maintained. Many view this as a positive improvement in the final rule.

The FDA also clarified the importance of the shipper’s role. The final rule essentially creates a default that gives shippers the primary responsibility for determining what is needed to keep food shipments safe. Shippers will need to communicate with carriers and specify in writing if a specific shipment requires certain precautions or controls. Although the rule allows shippers to require carriers or loaders to take on some of these responsibilities by contract, the burden will be on shippers to demonstrate that any transportation requirements were clearly communicated or that sanitary transport responsibilities were clearly placed on another party. This is another example of the FDA trying to give covered entities some flexibility in complying with the new rule.

In addition, “loaders” are now covered parties under the final rule. The FDA defines a “loader” as “a person that loads food onto a motor car or rail vehicle during transportation operations.” There were some concerns that the proposed rule would have required shippers to be responsible for third-party distribution centers or storage facilities over which they had little direct control. The final rule responds to these concerns by covering “loaders” directly.

The final rule also includes a new requirement that requires covered parties to make sure that food is not sold or distributed further if they become aware of conditions that “may” have rendered the food unsafe. A qualified individual needs to determine that the food is safe before it is distributed further, which probably will require communicating with other parties in the distribution chain. This sounds easy enough, but it adds pressure to what can already be some challenging situations. For example, a receiver that is unsure if food has been rendered unsafe needs to be careful before allowing food back into distribution — it’s not as easy as “rejecting” a shipment and giving the load back to a shipper or a carrier who might try to resell it.

There also are some recordkeeping requirements in the rule. Records generally need to be kept for one year. In an industry call following the release of the final rule, the FDA clarified that it is not intending to review in-transit temperature control records for every shipment. Receivers or shippers may require these records, but the FDA’s primary concern is that the parties have a written agreement regarding how temperature controls will be maintained when necessary. Any such agreement will need to be retained and potentially produced for examination by the FDA.

There were some other miscellaneous changes with the final rule as well. Some food and some transportation activities are not covered in the final rule, including food that is completely enclosed unless it requires temperature controls and farm-related transportation activities. 

CC: Were you surprised about how the final rule shaped up?

Ripple: I wouldn’t say I was surprised, but there are some clear policy choices reflected in the final rule. The FDA clearly believes the goals of this rule are best achieved by focusing on the shippers. I think this is a win for carriers. Carriers will need to have appropriate operating and training procedures in some circumstances, but their responsibilities for any particular shipment will be determined for the most part by their shipping contracts. 

Brokers, on the other hand, will not be happy with the final rule. In the proposed rule, the FDA proposed a definition of “shipper” that included any parties “initiating” a shipment. Although some of the industry expressed concerns that the proposed definition was too broad, the FDA essentially confirmed its broad view in the final rule and revised “shipper” to include any person who “arranges” for transportation, including brokers. Remember that the rule places primary responsibility on the shippers because they are supposedly in the best position to know what is needed to keep food safe during transportation. Probably not all brokers see this as their role.

It’s potentially a similar situation for third-party logistics providers or distribution facilities that may now qualify as “loaders” under the final rule. Many of these parties likely were already trying to respond to customer demands, but they now need to respond to the FDA as well.

Finally, the increased flexibility for temperature monitoring and controls is significant. It’s a win for the industry, and it’s consistent with the FDA’s willingness to let the parties refine some of these regulatory responsibilities by written agreements. But it’s not the only choice that the agency could have made, so the FDA was obviously responding to some industry concerns.

Most businesses have until April 2017 to comply. We’ll be watching how this develops.

CC: What are you seeing in terms of readiness in the industry to comply with the final rule?

Ripple: I think there is a range in terms of readiness. Some firms are operating with industry best practices. Other companies are still probably coming to grips with the fact that these are now concrete regulations, and if they are just now trying to catch up with them, then they’re behind what other firms in the industry have already adopted and expect in doing business.

Even for firms that already have adopted industry best practices, the final rule is significant because these are not agency recommendations. It’s the law. All entities subject to the new regulations are going to want to take a close look at the final rule and make sure they are compliant in case they are asked to produce documents or demonstrate their compliance with the rule and show that their SOPs are in place to address potential threats to food safety.

The FDA always has had the authority to enforce the statutory provisions of the Food, Drug and Cosmetic Act, but the agency now has detailed regulations to push compliance across the board. For entities in the transportation space that don’t necessarily identify themselves as part of the food industry (e.g., perhaps they only occasionally transport or broker food shipments), these regulations require them to think differently. The FDA is using the Food Safety Modernization Act to create a food safety system that focuses on preventing foodborne illness rather than simply responding after it occurs. This rule makes clear that the transportation industry is a part of that system, and that it plays a crucial role in ensuring the safety of the nation’s food supply. 

CC: What about enforcement? Does the FDA have the necessary staff and resources?

Ripple: This is an uncertainty for all of the new rules under the Food Safety Modernization Act. The FDA has indicated that it will enforce the Sanitary Transport Rule with the help of the Department of Transportation and potentially with the assistance of state enforcement resources. We will have to see how that develops, including how investigators are trained to evaluate compliance with the new requirements. The FDA always can enforce the regulations through requests to review documents. And perhaps most importantly, even if enforcement is more selective because of a lack of resources, gambling on a lack of enforcement is a big risk with these regulations. A carrier that does not comply is not risking a temporary out-of-service order. Noncompliance may have significant civil and criminal penalties.

CC: What can the food transportation industry learn from the pharmaceutical industry with regards to cold chain integrity and best practices?

Ripple: You’re probably referring to product tracing. The Food Safety Modernization Act directs the FDA to work with the U.S. Department of Agriculture and state departments of health to establish pilot projects to explore food-tracing technologies. Those pilots were completed through a contract with a third-party, and a report was issued in 2013. Among other things, the report recommended that each member of the food supply chain be required to develop a product-tracing plan. That could be where this is all headed, and supply chain tracing technologies from a variety of industries will likely influence that conversation. The FDA is eventually supposed to submit a report to Congress with its own recommendations based on the pilot projects. Some of these tracing technologies could play a role in monitoring sanitary and cold chain transport. 

CC: While there is a cost associated with compliance, savvy food shippers and others in the industry also see this as a competitive advantage and a way to tout their capabilities in food safety to their customers. Do you agree?

Ripple: The financial burden of the Sanitary Transport Rule will vary in how it affects different players in the industry. Some covered entities are probably finding they need to catch up to others that have been making investments all along.

I think we can all agree on the importance of improving the safety of the nation’s food supply. As these regulations are enforced in the years ahead, the question is whether they will accomplish that goal and how the industry will respond. Hopefully, the flexibility built into the new requirements will enable the industry to continue to innovate and find arrangements that most efficiently manage food risks while meeting customer demands. We’ll be watching to see.