62400 Federal Register / Vol. 71, No. 206 / Wednesday, October 25, 2006 / Proposed Rules 

the reason for any position, and include 

supporting data. We ask that you send 

us two copies of written comments. 

We will file in the docket all 

comments we receive, as well as a 

report summarizing each substantive 

public contact with FAA personnel 

concerning this proposed rulemaking. 

The docket is available for public 

inspection before and after the comment 

closing date. If you wish to review the 

docket in person, go to the address in 

the ADDRESSES section of this preamble 

between 9 a.m. and 5 p.m., Monday 

through Friday, except Federal holidays. 

You may also review the docket using 

the Internet at the Web address in the 

ADDRESSES section. 

Privacy Act: Using the search function 

of our docket Web site, anyone can find 

and read the comments received into 

any of our dockets, including the name 

of the individual sending the comment 

(or signing the comment on behalf of an 

association, business, labor union, etc.). 

You may review DOT’s complete 

Privacy Act Statement in the Federal 

Register published on April 11, 2000 

(65 FR 19477–78) or you may visit 

http://dms.dot.gov. 

Background 

Section 121.383(c) of Title 14 of the 

United States Code (the Age 60 Rule) 

prohibits any air carrier from using the 

services of any person as a pilot, and 

prohibits any person from serving as a 

pilot, on an airplane engaged in 

operations under part 121 if that person 

has reached his or her 60th birthday. 

The FAA adopted the Age 60 Rule in 

1959. Part 121 covers operations of large 

commercial passenger aircraft, smaller 

propeller aircraft with 10 or more 

passenger seats, and common carriage 

operations of all-cargo aircraft with a 

payload capacity of 7500 pounds. 

In November 2006, the International 

Civil Aviation Organization (ICAO) will 

adopt Amendment 167 to increase the 

‘‘upper age limit’’ for airline pilots up to 

age 65 provided another crewmember 

pilot is under age 60. The Age 60 ARC 

provides a forum for the U.S. aviation 

community to discuss the new ICAO 

standard, make recommendations as to 

whether the United States should adopt 

that standard, and determine what 

actions would be necessary if FAA were 

to change the regulation to meet the new 

ICAO standard. As part of the ARC’s 

review and recommendation, it and the 

FAA are soliciting comments from the 

public on whether the FAA should 

adopt the ICAO standard and any issues 

surrounding adopting or not adopting 

the standard. 

Issued in Washington, DC, on October 19, 

2006. 

James R. Fraser, 

Acting Federal Air Surgeon. 

[FR Doc. E6–17851 Filed 10–24–06; 8:45 am] 

BILLING CODE 4910–13–P 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Food and Drug Administration 

21 CFR Parts 101 and 170 

[Docket No. 2002P–0122] (formerly 02P–

0122) 

Conventional Foods Being Marketed 

as ‘‘Functional Foods’’; Public 

Hearing; Request for Comments 

AGENCY: Food and Drug Administration, 

HHS. 

ACTION: Notice of public hearing; request 

for comments. 

SUMMARY: The Food and Drug 

Administration (FDA) is announcing a 

public hearing on the regulation of 

certain conventional foods that 

companies are marketing as ‘‘functional 

foods.’’ The purpose of the hearing is for 

the agency to share its current 

regulatory framework and rationale 

regarding the safety evaluation and 

labeling of these foods, and to solicit 

information and comments from 

interested persons on how FDA should 

regulate these foods under the agency’s 

existing legal authority. 

DATES: The public hearing will be held 

on Tuesday, December 5, 2006, from 9 

a.m. to 4:30 p.m. Persons who wish to 

request an opportunity to make an oral 

presentation must submit a notice of 

participation by November 14, 2006. All 

other persons must submit a notice of 

participation by November 28, 2006. 

Persons who request an opportunity to 

make an oral presentation also must 

submit either the full text of the oral 

presentation, or a comprehensive 

outline or summary of the oral 

presentation, by November 28, 2006. 

Written or electronic comments (i.e., 

submissions other than notices of 

participation and the text, 

comprehensive outline, or summary of 

an oral presentation) may be submitted 

until January 5, 2007. The 

administrative record of the hearing will 

remain open until January 5, 2007. 

ADDRESSES: The public hearing will be 

held at Food and Drug Administration, 

Center for Food Safety and Applied 

Nutrition, 5100 Paint Branch Pkwy., 

Harvey W. Wiley Auditorium, College 

Park, MD 20740 (Metro stop: College 

Park on the Green Line). 

Submit electronic notices of 

participation to http:// 

www.cfsan.fda.gov/~comm/ 

register.html. Submit written notices of 

participation and the written full text, 

comprehensive outline, or summary of 

any oral presentation to Isabelle Howes, 

U.S. Department of Agriculture 

Graduate School, 600 Maryland Ave., 

SW., suite 270 Washington, DC 20024–

2520. To submit a notice of 

participation orally, or to submit a 

notice of participation or the full text, 

comprehensive outline or summary of 

the oral presentation by e-mail or by fax, 

see FOR FURTHER INFORMATION CONTACT. 

Submit written comments to the 

Division of Dockets Management (HFA–

305), Food and Drug Administration, 

5630 Fishers Lane, rm. 1061, Rockville, 

MD 20852. Submit electronic comments 

to http://www.fda.gov/dockets/ 

ecomments. 

Instructions: All submissions and 

comments received must include the 

agency name and docket number found 

in brackets in the heading of this 

document. All submissions and 

comments received may be posted 

without change to http://www.fda.gov/ 

ohrms/dockets/default.htm, including 

any personal information provided. For 

additional information on submitting 

comments, see the ‘‘Request for 

Comments’’ heading of the 

SUPPLEMENTARY INFORMATION section of 

this document. 

Transcripts of the hearing will be 

available for review at the Division of 

Dockets Management and on the 

Internet at http://www.fda.gov/ohrms/ 

dockets/default.htm, approximately 30 

days after the hearing. 

FOR FURTHER INFORMATION CONTACT: 

To submit a notice of participation 

orally, by fax, or by e-mail: Isabelle 

Howes, U.S. Department of 

Agriculture Graduate School, 202–

314–4713, FAX: 202–479–6801, or 

e-mail: 

isabelle_howes@grad.usda.gov. 

For all other questions about the 

meeting, to request onsite parking, 

or if you need special 

accommodations due to a 

disability: Juanita Yates, Center for 

Food Safety and Applied Nutrition, 

Food and Drug Administration, 

5100 Paint Branch Pkwy., College 

Park, MD 20740, 301–436–1714, email: Juanita.Yates@fda.hhs.gov. 

SUPPLEMENTARY INFORMATION: 

I. Background 

A. Introduction 

FDA is responsible for ensuring that 

all foods in the American food supply 

(other than meat products, poultry 

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products, and egg products that are 

regulated by the U.S. Department of 

Agriculture) are safe, secure, sanitary, 

wholesome, and properly labeled. 

Section 201(f) of the Federal Food, 

Drug, and Cosmetic Act (FFDCA or the 

act) (21 U.S.C. 321(f)) defines food to 

mean: (1) Articles used for food or drink 

for man or other animals, (2) chewing 

gum, and (3) articles used for 

components of any such article. The act 

also defines several specific types of 

food and substances that are added to 

food, including: ‘‘raw agricultural 

commodity’’ (section 201(r) (21 U.S.C. 

321(r))), ‘‘food additive’’ (section 201(s) 

(21 U.S.C. 321(s))), ‘‘color additive’’

(section 201(t) (21 U.S.C. 321(t))), 

‘‘infant formula’’ (section 201(z) (21 

U.S.C. 321(z))), ‘‘dietary supplement’’

(section 201(ff) (21 U.S.C. 321(ff))), and 

‘‘processed food’’ (section 201(gg) (21 

U.S.C. 321(gg))). 

The act does not define the term 

‘‘conventional food.’’ However, the act 

defines a dietary supplement, in part, as 

a product that is ‘‘not represented for 

use as a conventional food’’ (see section 

201(ff)(2)(B) (21 U.S.C. 321(ff)(2)(B))). 

Products such as beverages, baked 

goods, cheeses, milk products, cereal, 

grain products, pasta, fats and oils, 

vegetable spreads, snack foods, candy, 

soups, and infant formula are examples 

of conventional foods. The act includes 

provisions that relate to certain types of 

conventional food, such as requirements 

for infant formula in section 412 of the 

act (21 U.S.C. 350a). 

In recent years, the food industry has 

developed and marketed foods that it 

refers to as ‘‘functional foods.’’

Although there is no formal definition 

of what the industry means by 

‘‘functional food,’’ on March 24, 2005, 

the Institute of Food Technologists (IFT) 

issued a report entitled ‘‘Functional 

Foods: Opportunities and Challenges’’

(Ref. 1) (the IFT report) in which 

‘‘functional foods’’ are defined as ‘‘foods 

and food components that provide a 

health benefit beyond basic nutrition 

(for the intended population). * * * 

These substances provide essential 

nutrients often beyond quantities 

necessary for normal maintenance, 

growth, and development, and/or other 

biologically active components that 

impart health benefits or desirable 

physiological effects.’’ Examples of 

functional foods cited in the report 

include ‘‘conventional foods; fortified, 

enriched or enhanced foods; and dietary 

supplements.’’

Currently, FDA has neither a 

definition nor a specific regulatory 

rubric for foods being marketed as 

‘‘functional foods.’’ We regulate 

conventional foods being marketed as 

‘‘functional foods’’ under the same 

regulatory framework as other 

conventional foods. Although we are 

confident that the existing provisions of 

the act are adequate to ensure that 

conventional foods being marketed as 

‘‘functional foods’’ are safe and lawful, 

we believe that it would be in the best 

interest of public health to begin a 

dialog with industry, consumers, and 

other stakeholders regarding the 

regulation of these products. Therefore, 

in this document we announce a public 

hearing to afford consumers, industry, 

and other interested parties the 

opportunity to provide focused 

comments on approaches to the 

regulation of conventional foods being 

marketed as ‘‘functional foods.’’ As 

background relevant to the hearing, we 

describe key provisions of the act 

regarding the safety and labeling of 

conventional foods. 

For the purpose of this hearing, we 

are not considering dietary supplements 

to be encompassed by the term 

‘‘functional foods.’’ Dietary supplements 

have their own detailed regulatory 

framework prescribed by Congress in 

the Dietary Supplement Health and 

Education Act of 1994 (DSHEA) (Public 

Law 103–417, 108 Stat. L. 4325), which 

amended the FFDCA to define ‘‘dietary 

supplement’’ and to set forth 

requirements for the safety and labeling 

of dietary supplements. DSHEA 

specifically excludes from the definition 

of dietary supplement any product that 

is ‘‘represented for use as a conventional 

food or as a sole item of a meal or the 

diet’’ (Section 201(ff)(2)(B) of the act (21 

U.S.C. 321(ff)(2)(B)). However, because 

some labeling provisions of the act with 

respect to dietary supplements are 

relevant to the issues and questions that 

are part of the scope of this hearing, in 

this document we describe some 

labeling provisions of the act with 

respect to dietary supplements. 

B. Statutory and Regulatory Framework 

for the Safety of Food Ingredients 

In 1958, Congress enacted the Food 

Additives Amendment (the 1958 

amendment) to the act (Public Law 85–

929, 72 Stat. L. 1784). The basic thrust 

of the 1958 amendment was to require 

‘‘the processor who wants to add a new 

and unproven additive to accept the 

responsibility of * * * first proving it to 

be safe for ingestion by human beings’’

(S. Rept. 2422, 85th Cong., 2d Sess.). 

The 1958 amendment defined the terms 

‘‘food additive’’ (section 201(s) of the act 

(21 U.S.C. 321(s))) and ‘‘unsafe food 

additive’’ (section 409(a) of the act (21 

U.S.C. 348(a))), established a premarket 

approval process for food additives 

(section 409(b) through (g) (21 U.S.C. 

348(b) through (g)), and amended the 

food adulteration provisions of the act 

to deem adulterated any food that is, or 

bears or contains, any food additive that 

is unsafe within the meaning of section 

409 (section 402(a)(2)(C) of the act (21 

U.S.C. 342(a)(2)(C))). 

Recognizing that the safety of a food 

additive cannot be established with 

absolute certainty and that safety is 

dependent on dietary intake and other 

conditions of use, Congress stated that 

‘‘safety’’ under the 1958 amendment 

means a reasonable certainty that no 

harm will result from the intended use 

of an additive (S. Rept. 2422, 85th 

Cong., 2d Sess.). We have incorporated 

this safety standard into our regulation 

defining the terms ‘‘safe’’ and ‘‘safety‘‘

(21 CFR 170.3(i)). If we find an additive 

to be safe, based ordinarily on data 

submitted by the manufacturer to the 

agency in a food additive petition, we 

issue a regulation specifying the 

conditions under which the additive 

may be safely used in food. 

Many substances intentionally added 

to food do not require a formal 

premarket review by FDA to assure their 

safety, either because their safety has 

been established by a long history of use 

in food or by virtue of the nature of the 

substances, their customary or projected 

conditions of use, and the information 

generally available to scientists about 

the substances. In enacting the 1958 

amendment, Congress addressed this 

category of substances by adopting, in 

section 201(s) of the act (21 U.S.C. 

321(s)), a two-step definition of ‘‘food 

additive.’’ The first step broadly 

includes any substance, the intended 

use of which results or may reasonably 

be expected to result, directly or 

indirectly, in its becoming a component 

or otherwise affecting the characteristics 

of food. The second step, however, 

excludes from the definition of ‘‘food 

additive’’ substances that are generally 

recognized, among experts qualified by 

scientific training and experience to 

evaluate their safety, as having been 

adequately shown through scientific 

procedures (or, in the case of a 

substance used in food prior to January 

1, 1958, through either scientific 

procedures or through experience based 

on common use in food) to be safe 

under the conditions of their intended 

use. Substances that are exempted from 

the food additive definition under this 

second step are referred to as ‘‘GRAS’’

(generally recognized as safe). The 

safety standard for a GRAS substance is 

the same as the safety standard for a 

food additive, i.e., reasonable certainty 

of no harm under the substance’s 

intended conditions of use (21 CFR 

170.30(i)). However, for the use of a 

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substance to be GRAS, it must not only 

be safe but, unlike for an approved food 

additive, there must also be general 

recognition of its safety among qualified 

experts. 

We have established regulations 

governing the food additive petition 

process (21 CFR 171.1). We also have 

established regulations (21 CFR 

170.35(c)) governing a voluntary process 

whereby an interested person may 

petition us to affirm, through 

rulemaking, that a use of a food 

substance is GRAS. However, more 

recently we have proposed to eliminate 

the voluntary GRAS affirmation petition 

process and replace it with a voluntary 

notification procedure in which we 

respond to a notifier by letter rather 

than conduct rulemaking to affirm 

GRAS status (62 FR 18937, April 17, 

1997 (the GRAS proposal)). As 

announced in the GRAS proposal, we 

are accepting GRAS notices during the 

interim between the proposed rule and 

any final rule that publishes based on 

the proposed rule. A summary of 

notices filed under the rubric of the 

GRAS proposal, with links to our letters 

responding to those notices, is available 

on the Internet (see http:// 

www.cfsan.fda.gov/~rdb/opagras.html). 

We have developed a number of 

guidance documents relevant to 

evaluating the safety of food ingredients, 

such as recommendations relating to 

chemical and toxicological 

considerations. These are available at 

http://www.cfsan.fda.gov/~dms/opaguid.html. 

C. Statutory and Regulatory Framework 

for the Labeling of Food 

1. Provisions regarding false or 

misleading labeling 

Under section 403(a)(1) of the act (21 

U.S.C. 343(a)(1)), a food is misbranded 

if its labeling is false or misleading in 

any particular. Under section 201(n) of 

the act (21 U.S.C. 321(n)), in 

determining whether the labeling of an 

article is misleading, ‘‘there shall be 

taken into account (among other things) 

not only representations made or 

suggested by statement, word, design, 

device, or any combination thereof, but 

also the extent to which the labeling 

fails to reveal facts material in the light 

of such representations or material with 

respect to consequences which may 

result from the use of the article to 

which the labeling relates under the 

conditions of use prescribed in the 

labeling thereof or under such 

conditions of use as are customary or 

usual.’’

Sections 403(a)(1) and 201(n) of the 

act (21 U.S.C. 343(a) and 321(n)) broadly 

apply to the labeling of all foods, in 

addition to any specific labeling 

requirements established by or under 

authority of the act for certain foods or 

for certain statements on foods. In the 

absence of specific statutory or 

regulatory requirements for statements 

in the labeling of a food, we apply the 

standards of sections 403(a)(1) and 

201(n) of the act (21 U.S.C. 343(a)(1) and 

321(n)) to determine if the food is 

misbranded. 

2. Provisions for health claims and 

nutrient content claims 

Section 403(r) of the act (21 U.S.C. 

343(r)) lays out the statutory framework 

for the use of labeling claims that 

characterize the relationship of a 

substance in food to a disease or healthrelated condition (‘‘health claims,’’

defined in section 403(r)(1)(B) of the act 

(21 U.S.C. 343(r)(1)(B)), or that 

characterize the level of a nutrient in a 

food (‘‘nutrient content claims,’’ defined 

in section 403(r)(1)(A) of the act (21 

U.S.C. 343(r)(1)(A))). We have 

established regulations implementing 

section 403(r) of the act (21 U.S.C. 

343(r)) with respect to health claims (21 

CFR 101.14 and subpart E) and with 

respect to nutrient content claims (21 

CFR 101.13 and subpart D). 

The definition of ‘‘health claim’’

identifies two basic elements for a 

health claim: (1) A substance (e.g, a 

nutrient); and (2) a disease or healthrelated condition (see section 

403(r)(1)(B) of the act (21 U.S.C. 

343(r)(1)(B)) and 21 CFR 101.14(a)(1)). 

In determining whether a particular 

claim is a health claim, we evaluate, in 

part, whether the claim is about a 

substance in food (see 21 CFR 

101.14(a)(2)) and whether the claim is 

about reducing risk for a disease or 

health-related condition (see Whitaker 

v. Thompson, 353 F.3d 947 (D.C. Cir.), 

cert. denied, 125 S. Ct. 310 (2004)). 

There are three ways by which we 

exercise our oversight in determining 

which health claims may be used in the 

labeling of conventional foods and 

dietary supplements. First, the Nutrition 

Labeling and Education Act of 1990 

(NLEA) (Public Law 101–535, 104 Stat. 

L. 2353), which amended the FFDCA, 

provides for us to issue regulations 

authorizing health claims for 

conventional foods and dietary 

supplements after our evaluation of the 

scientific evidence relative to the claim 

under the significant scientific 

agreement (SSA) standard (see section 

403(r)(3)(B) of the act (21 U.S.C. 

343(r)(3)(B)). Health claims authorized 

through this process are commonly 

referred to as ‘‘SSA claims.’’ Second, the 

Food and Drug Administration 

Modernization Act of 1997 (FDAMA) 

(Public Law 105–115, 111 Stat. L. 2296), 

amended the FFDCA to provide for 

health claims for conventional foods 

based on an authoritative statement of 

certain scientific bodies of the United 

States government or of the National 

Academy of Sciences (now the National 

Academies). Such claims may be used 

from 120 days after submission of a 

health claim notification to FDA until 

the agency prohibits or modifies the 

claim by regulation or obtains a court 

order determining that the statutory 

requirements for an authoritative 

statement notification health claim have 

not been met (see section 403(r)(3)(C)–

(D) of the act (21 U.S.C. 343(r)(3)(C)–

(D))). We have issued guidance on the 

authoritative statement notification 

procedure (see Guidance for Industry: 

Notification of a Health Claim or 

Nutrient Content Claim Based on an 

Authoritative Statement of a Scientific 

Body; available at http:// 

www.cfsan.fda.gov/~dms/ 

hclmguid.html) (Ref. 2). Third, as a 

result of court decisions interpreting the 

first amendment of the U.S. 

Constitution, we exercise enforcement 

discretion with respect to certain 

qualified health claims (QHC) where 

there is credible evidence to support the 

proposed claim, but the strength of the 

scientific evidence falls below that 

required for FDA to issue an authorizing 

regulation based on significant scientific 

agreement (see, e.g., Pearson v. Shalala, 

164 F.3d 650 (D.C. Cir. 1999)). For 

information on qualified health claims 

for which FDA has issued a letter of 

enforcement discretion, see http:// 

www.cfsan.fda.gov/~dms/qhcsum.html). 

A ‘‘nutrient content claim’’ is a 

statement in food labeling that explicitly 

or implicitly characterizes the level of a 

nutrient in a food (see section 

403(r)(1)(A) of the act (21 U.S.C. 

343(r)(1)(A)) and 21 CFR 101.13(b)). 

Nutrient content claims must be 

authorized by regulation (see section 

403(r)(2)(A)(i) and (r)(4)(A)(i) of the act 

(21 U.S.C. 343(r)(2)(A)(i) and 

(r)(4)(A)(i))), through a synonym or 

brand name petition process (see section 

403(r)(4)(A)(ii)–(iii) of the act (21 U.S.C. 

343(r)(4)(A)(ii)–(iii))), or (for 

conventional foods only) through an 

authoritative statement notification 

process (see section 403(r)(2)(G)–(H) of 

the act (21 U.S.C. 343(r)(2)(G)–(H))) 

before they may be used in food 

labeling. 

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3. Provisions for structure/function 

claims 

In the DSHEA, Congress amended 

section 403(r) of the act (21 U.S.C. 

343(r)) to authorize certain types of 

claims to be used in the labeling of 

dietary supplements without premarket 

review by FDA. Among the types of 

claims specifically authorized are 

statements describing the role of a 

nutrient or dietary ingredient intended 

to affect the structure or function of the 

body in humans and statements that 

characterize the documented 

mechanism by which a nutrient or 

dietary ingredient acts to maintain such 

structure or function. Under section 

403(r)(6) of the act (21 U.S.C. 343(r)(6)), 

such statements (as well as two other 

types of claims not relevant to this 

notice) may be made in the labeling of 

a dietary supplement if the 

manufacturer of the dietary supplement 

has substantiation that such statement is 

truthful and not misleading, and the 

statement contains, prominently 

displayed and in boldface type, the 

following: ‘‘This statement has not been 

evaluated by the Food and Drug 

Administration. This product is not 

intended to diagnose, treat, cure, or 

prevent any disease.’’ A statement under 

section 403(r)(6) (21 U.S.C. 343(r)(6)) 

may not claim to diagnose, mitigate, 

treat, cure, or prevent a specific disease 

or class of diseases. The manufacturer of 

a dietary supplement that bears such a 

statement must notify FDA, no later 

than 30 days after the first marketing of 

the dietary supplement with the 

statement, that the statement is being 

made. We have established in 21 CFR 

101.93 regulations implementing 

section 403(r)(6) of the act (21 U.S.C. 

343(r)(6)). 

The act includes no provision 

analogous to section 403(r)(6) of the act 

(21 U.S.C. 343(r)(6)) for statements made 

in the labeling of conventional food. 

However, the provision of the act that 

defines ‘‘drug’’ to include articles 

intended to affect the structure or 

function of the body contains an 

exception for foods, which affect the 

structure and function of the body by 

virtue of providing nutrition to sustain 

life and health (see section 201(g)(1)(C) 

of the act (21 U.S.C. 321(g)(1)(C)). As 

discussed in section I.A of this 

document, ‘‘food’’ is defined in section 

201(f) of the act (21 U.S.C. 321(f)). 

Therefore, for conventional foods we 

regulate claims about the effect of a 

substance in food on the structure or 

function of the body under sections 

201(f), 201(g), 403(a) and 201(n) of the 

act, as well as case law interpreting 

these provisions (see, e.g., Nutrilab v. 

Schweiker, 713 F.2d 335 (7th Cir. 

1983)). 

D. Nutrition and Fortification Policy 

The Dietary Guidelines for Americans, 

2005 (Dietary Guidelines) (Ref. 3), a 

joint publication of the Department of 

Health and Human Services, FDA’s 

parent agency, and the U.S. Department 

of Agriculture, forms the basis for the 

Federal Government’s nutrition 

programs and policies. The Executive 

Summary of the Dietary Guidelines 

states: ‘‘A basic premise of the Dietary 

Guidelines is that nutrient needs should 

be met primarily through consuming 

foods. Foods provide an array of 

nutrients and other compounds that 

may have beneficial effects on health. In 

certain cases, fortified foods and dietary 

supplements may be useful sources of 

one or more nutrients that otherwise 

might be consumed in less than 

recommended amounts. However, 

dietary supplements, while 

recommended in some cases, cannot 

replace a healthful diet.’’

FDA’s policy on food fortification is 

set forth in § 104.20 (21 CFR 104.20), 

which outlines the circumstances under 

which FDA considers fortification to be 

appropriate; e.g., to correct a nutritional 

deficiency recognized by the scientific 

community or to replace nutrients lost 

in storage, handling, or processing. Folic 

acid-fortified grain products and milk 

fortified with Vitamin D are examples of 

fortification under § 104.20. 

E. Reports and Recommendations 

Regarding ‘‘Functional Foods’’ 

In July 2000, the General Accounting 

Office (GAO; now the Government 

Accountability Office) issued a report 

(the GAO report) entitled 

‘‘Improvements Needed in Overseeing 

the Safety of Dietary Supplements and 

‘Functional Foods’’’ (Ref. 4). The GAO 

report makes recommendations to the 

Congress (regarding statutory 

amendments) and to FDA (regarding the 

development of regulations and 

guidance) directed to improving Federal 

oversight of safety for dietary 

supplements and ‘‘functional foods’’

and to ensuring that these products 

provide the health benefits they claim. 

The GAO report recommends that 

Congress amend the act to require 

‘‘functional food’’ manufacturers to 

meet these requirements: Advance 

notification to FDA regarding 

ingredients that companies have 

determined are safe; notification to FDA 

regarding the use of labeling claims 

about effects on the structure or 

function of the human body (structure/ 

function claims); and disclaimers of 

FDA approval on product labels 

containing structure/function claims. 

The GAO report also recommends that 

FDA: (1) Develop and promulgate 

regulations or guidance for industry on 

the safety-related information required 

on labels for ‘‘functional foods’’ and (2) 

develop and promulgate regulations or 

guidance for industry on the evidence 

needed to support structure/function 

claims. 

In August 2000 the Functional Foods 

Committee of the International Life 

Sciences Institute (ILSI) issued a report 

(the ILSI report) entitled ‘‘Health Claims 

on Functional Foods—Proposals on 

Scientific Substantiation and Regulatory 

Systems’’ (Ref. 5). The ILSI report 

emphasizes factors to consider when 

conducting a clinical study in support 

of a health claim so as to be able to 

appropriately use the data collected 

during the study. As a basis for its 

proposals, the ILSI report includes 

information, both domestic and 

international, regarding recent progress 

in the area of health claims from a 

regulatory perspective and regarding 

recent developments with ‘‘functional 

foods’’ from a commercial perspective. 

In March 2002 the Center for Science 

in the Public Interest (CSPI) submitted 

a citizen petition making several 

requests concerning FDA regulation of 

‘‘functional foods’’ (the CSPI petition; 

Docket No. 2002P–0122; formerly 02P–

0122) (Ref. 6). We describe some of 

CSPI’s requests in more detail in section 

III of this document. 

In March 2005 the IFT issued its 

report entitled ‘‘Functional Foods: 

Opportunities and Challenges’’ (Ref. 1). 

We describe some of IFT’s 

recommendations in more detail in 

section III of this document. 

II. Purpose and Scope of the Hearing 

The purpose of the hearing is for the 

agency to share its current regulatory 

framework and rationale regarding the 

safety evaluation and labeling of 

conventional foods being marketed as 

‘‘functional foods,’’ and to solicit 

information and comments from 

interested persons on how FDA should 

regulate these foods under the agency’s 

existing legal authority. The scope of 

this hearing is determined by this 

notice. FDA invites information and 

comments on the issues and questions 

listed in section III of this document as 

follows: 

III. Issues and Questions for Discussion 

A. Food Ingredients 

• Issue 1: The CSPI petition requests 

that we require food companies to notify 

us regarding the use of ‘‘novel 

ingredients’’ prior to marketing foods 

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62404 Federal Register / Vol. 71, No. 206 / Wednesday, October 25, 2006 / Proposed Rules 

containing such ingredients. The CSPI 

petition does not define the term ‘‘novel 

ingredients.’’ For the purpose of this 

hearing, we are using the term 

‘‘functional food’’ to mean conventional 

foods that are being marketed as 

‘‘functional foods,’’ and we are using the 

term ‘‘ingredients’’ to mean ‘‘functional 

food’’ ingredients that may have a 

purported health benefit and that may 

be the subject of a label statement about 

this purported health benefit, whether 

or not the ingredient is new to the food 

supply. 

Question 1a. Is there a need for a 

regulatory definition and a distinct 

regulatory approach to the evaluation of 

the safety of ingredients added to 

‘‘functional foods’’? If yes, what would 

be included in this new definition and 

approach that is not adequately 

addressed under the existing definition 

of food additive or the provisions in the 

definition for GRAS substances, and 

what is the scientific and legal basis for 

your position? Under what legal 

authority could FDA create this new 

definition and distinct regulatory 

approach? 

Question 1b. Should companies that 

market ingredients for addition to 

‘‘functional foods’’ be required to notify 

us prior to introducing the ingredients 

into interstate commerce? If yes, what is 

the scientific and legal basis for your 

position? 

• Issue 2: Generally, food additives 

have been used in conventional foods 

for their technical effects on the food, 

not for their effects on the body. Now, 

the interest in various uses of certain 

ingredients in conventional foods is due 

to the marketing of these conventional 

foods as ‘‘functional foods’’ with claims 

about health benefits. 

Question 2a. What types of data and 

information would be appropriate to 

demonstrate that ingredients added to 

conventional foods being marketed as 

‘‘functional foods’’ meet the safety 

standard of ‘‘reasonable certainty of no 

harm’’? What is the scientific and legal 

basis for your position? 

Question 2b. How could we partner 

with interested stakeholders regarding 

the development of appropriate 

recommendations or other information 

regarding the safety assessment of 

ingredients added to ‘‘functional 

foods’’? 

B. Food Labeling 

• Issue 3: The CSPI petition requests 

that we require food companies to notify 

us within 30 days of marketing a 

conventional food bearing a structure/ 

function claim if such food contains a 

‘‘novel ingredient,’’ and to include the 

disclaimer currently required on dietary 

supplements making structure/function 

claims on the label and in labeling of 

such foods. 

Question 3. If our statutory authority 

permits, should we require food 

companies to notify us within 30 days 

of marketing a conventional food 

bearing a structure/function claim and 

to include the disclaimer currently 

required on dietary supplements making 

structure/function claims in labeling of 

such foods? If yes, what is the scientific 

(e.g., consumer studies) basis for your 

position? Under what existing legal 

authority could FDA require notification 

of these claims? Under what legal 

authority could FDA require inclusion 

of such a disclaimer with these claims? 

• Issue 4: The IFT report recommends 

that companies wishing to make label 

claims regarding the effects of 

‘‘functional foods’’ or ingredients 

convene panels of independent experts 

qualified to evaluate the efficacy of the 

functional food component under 

consideration. According to IFT’s 

recommendations, the findings of these 

Generally Recognized as Efficacious 

(GRAE) panels would be submitted to 

FDA under a process that is similar to 

the notification program that we 

proposed for GRAS substances. If the 

GRAE panel report found that the 

proposed label claim was supported by 

the available scientific evidence, the 

agency would have 90 days to object to 

the use of the notified GRAE label 

claim, and in the absence of such 

objection the label claim would be 

permitted at the end of the 90 days. 

The act limits FDA’s ability to accept 

this recommendation with regard to 

certain health claims and nutrient 

content claims (assuming that the 

recommendation applies to nutrient 

content claims, which is unclear 

because the IFT report does not specify). 

First, the act requires health claims and 

nutrient content claims for conventional 

foods to be submitted to FDA for review 

through a petition process (see section 

403(r)(4)(A) of the act (21 U.S.C. 

343(r)(4)(A))), unless the proposed claim 

is based on an authoritative statement. 

Second, even though claims based on an 

authoritative statement are submitted to 

FDA for review through a notification 

process, the act limits the ‘‘scientific 

bodies’’ that can be sources of such an 

authoritative statement to certain 

Government agencies and the National 

Academy of Sciences (now the National 

Academies) (see sections 403(r)(2)(G)(i) 

and (r)(3)(C)(i) of the act (21 U.S.C. 

343(r)(2)(G)(i) and (r)(3)(C)(i))). The 

GRAE panels recommended in the IFT 

report do not qualify as scientific bodies 

for this purpose. FDA can and does 

consider the findings of outside groups 

that do not qualify as ‘‘scientific bodies’’

as part of the totality of publicly 

available scientific evidence evaluated 

in support of a health claim petition, 

however. 

In an advance notice of proposed 

rulemaking (ANPRM) on food labeling, 

including health claims (68 FR 66040 at 

66044; November 25, 2003 (the 2003 

ANPRM on food labeling)), we 

previously asked for public comment on 

a question about whether the 

evaluations of non-governmental groups 

should be given weight in evaluating the 

strength of the science supporting a 

health claim. In that ANPRM, we asked: 

‘‘If the agency should give weight to the 

evaluations of these groups, how should 

this weight be determined?’’ That 

question is related to IFT’s 

recommendations regarding the 

agency’s acceptance of the findings of 

GRAE panels for ‘‘functional food’’ label 

claims. We are asking the question 

below, which is similar to the question 

we asked in the 2003 ANPRM on food 

labeling, because we would like 

additional input on this topic. 

Question 4. Within our statutory 

authority, how (if at all) should FDA 

utilize the findings of non-governmental 

groups, such as the IFT recommended 

GRAE panels, in support of health 

claims, nutrient content claims, and 

other labeling claims about the effects of 

a ‘‘functional food’’ or ingredient, such 

as structure/function claims? What is 

the scientific and legal basis for your 

position? Should FDA institute a 

premarket notification process for 

review of the scientific evidence for 

structure/function claims for 

‘‘functional foods’’ and ingredients, as 

recommended by IFT? What is the 

scientific basis for your position? Under 

what existing legal authority could FDA 

institute a premarket notification 

process for review of the scientific 

evidence for ‘‘functional foods’’ and 

ingredients? 

• Issue 5: Under Nutrilab v. 

Schweiker (713 F.2d 335 (7th Cir. 

1983)), structure/function claims on the 

label or in labeling of conventional food 

make the product a drug if they promote 

the product for a structure/function 

effect (e.g., blocking the digestion of 

starch) that is unrelated to the product’s 

‘‘food’’ attributes of taste, aroma, and 

nutritive value. FDA has interpreted this 

court decision to limit structure/ 

function claims for conventional foods 

to claims about effects that derive from 

the taste, aroma, or nutritive value of the 

food or food ingredient that is the 

subject of the claim. FDA’s health claim 

regulations also require that the 

substance that is the subject of the claim 

contribute taste, aroma, nutritive value, 

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Federal Register / Vol. 71, No. 206 / Wednesday, October 25, 2006 / Proposed Rules 62405 

or a technical effect recognized in FDA’s 

food additive regulations (21 CFR 

101.14(b)(3)(i)). Because we recognize 

that food substances may confer health 

benefits through a number of processes, 

we have provided significant flexibility 

in determining whether a substance 

possesses nutritive value. Nutritive 

value is defined at 21 CFR 101.14(a)(3) 

as a value in sustaining human 

existence by such processes as 

promoting growth, replacing lost 

nutrients, or providing energy, and we 

have discussed this definition in many 

of our health claim reviews. Listings of 

health claims reviewed to date can be 

found at http://www.cfsan.fda.gov/ 

~dms/lab-ssa.html (SSA claims) and 

http://www.cfsan.fda.gov/~dms/qhcsum.html (QHCs). 

The IFT report criticizes the approach 

of requiring that the health benefit be 

derived from the food’s nutritive value 

as too restrictive to allow for claims on 

foods being marketed as ‘‘functional 

foods.’’ Instead, the IFT report 

recommends that FDA permit a labeling 

claim for a ‘‘functional food’’ if the 

claimed benefit is based either on 

nutritive value or on ‘‘the provision of 

a physical or physiological effect that 

has been scientifically documented or 

for which a substantial body of evidence 

exists for plausibility’’ (Ref. 1). 

Question 5. Given the agency’s 

interpretation of the definition of 

nutritive value as reflected in 21 CFR 

101.14(a)(3) and our decisions on the 

health claims reviewed to date, does or 

will the agency’s interpretation of 

Nutrilab v. Schweiker to limit structure/ 

function claims and health claims to 

those that are based on nutritive value 

(or other food attributes such as taste 

and aroma) adequately allow for claims 

in the labeling of ‘‘functional foods’’? If 

no, how is the agency’s approach 

inadequate? What is the scientific and 

legal basis for your position? If you 

favor a change in the agency’s approach, 

do you recommend that FDA adopt the 

IFT report’s recommendation on this 

issue, or some other alternative? What 

legal rationale would support your 

preferred change in approach? 

• Issue 6: The IFT report recommends 

that research into ‘‘functional foods’’ be 

stimulated using incentives to the food 

industry, including market exclusivity 

for their bioactive food components and 

government research grants for the 

investigation of these components. 

There is currently no statutory provision 

for exclusivity of the use of a substance 

added to food (whether this be a food 

additive or a GRAS substance) or for the 

use of a health claim (whether a health 

claim has been authorized under NLEA 

or FDAMA or whether FDA has issued 

a letter of enforcement discretion for a 

QHC). 

In the 2003 ANPRM on food labeling, 

we previously asked ‘‘How can FDA 

more effectively develop publicsponsored research on substance/ 

disease relationships?’’ (68 FR 66040 at 

66043). We are asking the question 

below, which is similar to the question 

we asked in the 2003 ANPRM on food 

labeling, because we would like 

additional input on this topic. 

Question 6. Should FDA provide 

incentives to manufacturers to conduct 

further research on emerging substance/ 

disease relationships? If yes, how? If 

yes, what is the scientific (e.g., 

consumer research) basis for your 

position? (For example, in the case of 

exclusivity, we are interested in 

consumer data concerning the use of a 

health claim on one product but not on 

other similar products by other 

manufacturers, and in how such data 

show that such claims are or are not 

misleading.) Under what existing legal 

authority could FDA provide such 

incentives? 

C. Overall Framework for Foods Being 

Marketed as ‘‘Functional Foods’’

• Issue 7: The FFDCA does not 

recognize ‘‘functional foods’’ as a 

distinct category of food, either by 

definition or through establishing 

specific requirements for ‘‘functional 

foods.’’ The IFT report recommends that 

we establish, by regulation, a definition 

of, and labeling requirements for, 

‘‘functional foods.’’ The IFT report 

asserts that these regulations are 

necessary because consumer interest in 

the relationship between diet and health 

has increased the demand for these 

foods. According to the IFT report, this 

increased consumer demand is causing 

the food industry to add more and larger 

amounts of substances to food and this 

competitive pressure has shifted the 

focus of food fortification from carefully 

orchestrated and closely monitored 

interventions for addressing specific 

dietary deficiencies to a focus on 

meeting market demands. 

Question 7. Can the conventional 

foods being marketed (now or in the 

future) as ‘‘functional foods’’ be 

adequately addressed through the 

current regulations for food additives, 

GRAS substances, and labeling claims? 

If no, how are these regulations 

insufficient to address these products, 

and what is the scientific and legal basis 

for your position? 

IV. Notice of Hearing Under 21 CFR 

Part 15 

By delegation from the Acting 

Commissioner of Food and Drugs (the 

Acting Commissioner) (Staff Manual 

Guide 1420.21, section 1(b)), the 

Associate Commissioner for Policy and 

Planning finds that it is in the public 

interest to permit persons to present 

information and views at a public 

hearing regarding the regulation of 

conventional foods marketed as 

‘‘functional foods,’’ and is announcing 

that the public hearing will be held in 

accordance with part 15 (21 CFR part 

15). The presiding officer will be the 

Acting Commissioner or his designee. 

The presiding officer will be 

accompanied by a panel of FDA 

employees with relevant expertise. 

Persons who wish to participate in the 

hearing must file a notice of 

participation (see ADDRESSES, DATES, 

FOR FURTHER INFORMATION CONTACT, and 

‘‘Notices of Participation’’ in section V 

of this document). By delegation from 

the Acting Commissioner (Staff Manual 

Guide 1420.21, section 1(b)), the 

Associate Commissioner for Policy and 

Planning has determined under 

§ 15.20(c) that advance submissions of 

oral presentations are necessary for the 

panel to formulate useful questions to 

be posed at the hearing under § 15.30(e), 

and that the submission of a 

comprehensive outline or summary is 

an acceptable alternative to the 

submission of the full text of the oral 

presentation. We request that 

individuals and organizations with 

common interests consolidate their 

requests for oral presentation and 

request time for a joint presentation 

through a single representative. After 

reviewing the notices of participation 

and accompanying information, we will 

schedule each oral presentation and 

notify each participant of the time 

allotted to the presenter and the 

approximate time that the presentation 

is scheduled to begin. If time permits, 

we may allow interested persons 

attending the hearing who did not 

submit a notice of participation in 

advance to make an oral presentation at 

the conclusion of the hearing. The 

hearing schedule will be available at the 

hearing. After the hearing, the schedule 

will be placed on file in the Division of 

Dockets Management (see ADDRESSES) 

under the docket number listed in 

brackets in the heading of this notice. 

To ensure timely handling of any 

mailed notices of participation, 

presentations, or comments, any outer 

envelope should be clearly marked with 

the docket number listed in brackets in 

the heading of this notice along with the 

statement ‘‘Conventional Foods Being 

Marketed as ‘Functional Foods’ Public 

Hearing.’’

Under § 15.30(f), the hearing is 

informal, and the rules of evidence do 

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62406 Federal Register / Vol. 71, No. 206 / Wednesday, October 25, 2006 / Proposed Rules 

not apply. No participant may interrupt 

the presentation of another participant. 

Only the presiding officer and panel 

members may question any person 

during or at the conclusion of each 

presentation. 

Public hearings under part 15 are 

subject to FDA’s policy and procedures 

for electronic media coverage of FDA’s 

public administrative proceedings (21 

CFR part 10, subpart C). Under 21 CFR 

10.205, representatives of the electronic 

media may be permitted, subject to the 

procedures and limitations in § 10.206, 

to videotape, film, or otherwise record 

FDA’s public administrative 

proceedings, including presentations by 

participants. The hearing will be 

transcribed as stipulated in § 15.30(b). 

The transcript will be available on the 

Internet at http://www.fda.gov/ohrms/ 

dockets/default.htm, and orders for 

copies of the transcript can be placed at 

the meeting or through the Division of 

Dockets Management (see ADDRESSES). 

Any handicapped persons requiring 

special accommodations to attend the 

hearing should direct those needs to the 

contact person (see FOR FURTHER

INFORMATION CONTACT). 

To the extent that the conditions for 

the hearing, as described in this notice, 

conflict with any provisions set out in 

part 15, this notice acts as a waiver of 

these provisions as specified in §§ 10.19 

and 15.30(h). In particular, § 15.21(a) 

states that the notice of hearing will 

provide persons an opportunity to file a 

written notice of participation with the 

Division of Dockets Management within 

a specified period of time. If the public 

interest requires, e.g., if a hearing is to 

be conducted within a short period of 

time, the notice may name a specific 

FDA employee and telephone number to 

whom an oral notice of participation 

may be given. If the public interest 

requires, the notice may also provide for 

submitting notices of participation at 

the time of the hearing. In this 

document, the conditions for the 

hearing specify that notices of 

participation be submitted 

electronically to an agency Internet site, 

to a contact person (outside of FDA) 

who will accept notices of participation 

by mail, telephone, fax, or e-mail, or in 

person on the day of the hearing (as 

space permits). We are using these 

procedures for submitting notices of 

participation, rather than provide for the 

submission of notices of participation to 

the Division of Dockets Management, 

because the hearing is to be conducted 

within a short period of time and these 

procedures are more efficient. In 

addition, these procedures provide more 

flexibility to persons who wish to 

participate in the hearing than would be 

provided if participants were required 

to submit the notice of participation in 

writing to the Division of Dockets 

Management. By delegation from the 

Acting Commissioner (Staff Manual 

Guide 1420.21, section 1(f)(2)(i)), the 

Associate Commissioner for Policy and 

Planning finds under § 10.19 that no 

participant will be prejudiced, the ends 

of justice will thereby be served, and the 

action is in accordance with law if 

notices of participation are submitted by 

the procedures listed in this notice 

rather than to the Division of Dockets 

Management. 

V. Notice of Participation 

Pre-registration by submission of a 

notice of participation is necessary to 

ensure participation. The notice of 

participation may be submitted 

electronically or by mail (see 

ADDRESSES). The notice of participation 

also may be submitted orally, by fax, or 

by E-mail (see FOR FURTHER INFORMATION

CONTACT). We encourage you to submit 

your notice of participation 

electronically. See DATES for the dates 

by which you must submit your notice 

of participation. A single copy of any 

notice of participation is sufficient. 

The notice of participation must 

include your name, title, business 

affiliation (if applicable), address, 

telephone number, fax number (if 

available), and e-mail address (if 

available). If you wish to request an 

opportunity to make an oral 

presentation during the open public 

comment period of the hearing, your 

notice of participation also must include 

the title of your presentation, the 

sponsor of the oral presentation (e.g., 

the organization paying travel expenses 

or fees), if any; and the approximate 

amount of time requested for the 

presentation. Presentations will be 

limited to the questions and subject 

matter identified in section III of this 

document. 

Under § 15.20(c), if you request an 

opportunity to make an oral 

presentation you must submit two 

copies of your presentation (either as 

the full text of the presentation, or as a 

comprehensive outline or summary), 

except that individuals may submit one 

copy. See DATES for the dates by which 

you must submit your presentation. See 

ADDRESSES and FOR FURTHER

INFORMATION CONTACT for information on 

where to send your presentation. 

Registration will be accepted on a 

first-come, first-served basis. 

Individuals who request an opportunity 

to make an oral presentation will be 

notified of the scheduled time for their 

presentation prior to the meeting. 

Depending on the number of oral 

presentations, we may need to limit the 

time allotted for each oral presentation 

(e.g., 5 minutes each). We request that 

interested persons and groups having 

similar interests consolidate their 

requests for oral presentation and 

present them through a single 

representative. If you need special 

accommodations due to a disability, 

please inform us (see FOR FURTHER

INFORMATION CONTACT). We will also 

accept registration onsite; however, 

space is limited and registration will be 

closed when the maximum seating 

capacity is reached. Individuals and 

organizations that do not pre-register to 

make an oral presentation may have the 

opportunity to speak if time permits. 

Persons pre-registered or wishing to 

register onsite should check in between 

8:30 and 9:00 a.m. We encourage all 

participants to attend the entire day. 

Because the meeting will be held in a 

Federal building, meeting participants 

must present photo identification and 

plan adequate time to pass through the 

security system. 

VI. Request for Comments 

Interested persons may submit to the 

Division of Dockets Management (see 

ADDRESSES) written or electronic 

comments for consideration at or after 

the hearing in addition to, or in place of, 

a request for an opportunity to make an 

oral presentation (see DATES). Submit 

two paper copies of any written 

comments, except that individuals may 

submit one copy. Comments are to be 

identified with the docket number 

found in brackets in the heading of this 

document. Received comments may be 

seen in the Division of Dockets 

Management between 9 a.m. and 4 p.m., 

Monday through Friday. 

VI. References 

1. Institute of Food Technologists, 

‘‘Functional Foods: Opportunities and 

Challenges,’’ 2005. (Available at http:// 

members.ift.org/IFT/Research/ 

IFTExpertReports/ 

functionalfoods_report.htm. Accessed and 

printed on September 25, 2006.) 

2. Food and Drug Administration, 

‘‘Guidance for Industry: Notification of a 

Health Claim or Nutrient Content Claim 

Based on an Authoritative Statement of a 

Scientific Body,’’ 1998. (Available at http:// 

www.cfsan.fda.gov/~dms/hclmguid.html) 

3. Department of Health and Human 

Services and Department of Agriculture, 

Executive Summary, Dietary Guidelines for 

Americans, 2005. (Available at http:// 

www.healthierus.gov/dietaryguidelines. 

Accessed and printed on September 25, 

2006.) 

4. General Accounting Office, 

‘‘Improvements Needed in Overseeing the 

Safety of Dietary Supplements and 

‘Functional Foods,’’’ 2000. (Available at 

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Federal Register / Vol. 71, No. 206 / Wednesday, October 25, 2006 / Proposed Rules 62407 

http://www.gao.gov/new.items/rc00156.pdf. 

Accessed and printed on September 25, 

2006.) 

5. International Life Sciences Institute, 

‘‘Health Claims on Functional Foods—

Proposals on Scientific Substantiation and 

Regulatory Systems,’’ 2000. 

6. Center for Science in the Public Interest, 

Citizen petition 2002P–0122, Petition for 

Rulemaking on Functional Foods and 

Request to Establish an Advisory Committee, 

2002. 

Dated: October 19, 2006. 

Randall W. Lutter, 

Associate Commissioner for Policy and 

Planning. 

[FR Doc. 06–8895 Filed 10–20–06; 3:48 pm] 

BILLING CODE 4160–01–S 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 1 

[REG–112994–06] 

RIN 1545–BF47 

Guidance Under Section 7874 

Regarding Expatriated Entities and 

Their Foreign Parents; Hearing 

Cancellation 

AGENCY: Internal Revenue Service, 

Treasury. 

ACTION: Cancellation of notice of public 

hearing on proposed rulemaking. 

SUMMARY: This document cancels a 

public hearing on proposed regulations 

under section 7874 of the Internal 

Revenue Code relating to the 

determination of whether a foreign 

entity shall be treated as a surrogate 

foreign corporation under section 

7874(a)(2)(B). 

DATES: The public hearing, originally 

scheduled for October 31, 2006, at 10 

a.m. is cancelled. 

FOR FURTHER INFORMATION CONTACT: 

Kelly Banks of the Publications and 

Regulations Branch, Legal Processing 

Division, Associate Chief Counsel 

(Procedure and Administration), at (202) 

622–0392 (not a toll-free number). 

SUPPLEMENTARY INFORMATION: A notice 

of proposed rulemaking by crossreference to temporary regulations and 

notice of public hearing that appeared 

in the Federal Register on Wednesday, 

August 16, 2006 (71 FR 47158), 

announced that a public hearing was 

scheduled for October 31, 2006, at 10 

a.m. in the auditorium, Internal 

Revenue Service, New Carrollton 

Building, 5000 Ellin Road, Lanham, MD 

20706. The subject of the public hearing 

is under section 7874 of the Internal 

Revenue Code. 

The public comment period for these 

regulations expired on October 10, 2006. 

The notice of proposed rulemaking by 

cross-reference to temporary regulations 

and notice of public hearing instructed 

those interested in testifying at the 

public hearing to submit a request to 

speak and an outline of the topics to be 

addressed. As of Wednesday, October 

18, 2006, no one has requested to speak. 

Therefore, the public hearing scheduled 

for October 31, 2006 is cancelled. 

LaNita VanDyke, 

Federal Register Liaison, Publications and 

Regulations Branch, Legal Processing 

Division, Associate Chief Counsel, (Procedure 

and Administration). 

[FR Doc. E6–17811 Filed 10–24–06; 8:45 am] 

BILLING CODE 4830–01–P 

DEPARTMENT OF DEFENSE 

Office of the Secretary 

32 CFR Part 161 

[DoD–2006–OS–0039; 0790–AI04] 

DLA Procedures for Eligible 

Purchasers of Munitions List/ 

Commerce Control List Items 

AGENCY: Department of Defense. 

ACTION: Proposed rule. 

SUMMARY: This proposed rule identifies 

the Defense Logistics Agency (DLA) 

proposed new procedures for 

determining the eligibility of applicants 

seeking to obtain excess and surplus 

United States Munitions List (USML) 

and Commerce Control List (CCL) items 

from DLA. These new procedures will 

provide greater safeguards to protect 

national security interests before 

releasing such property into commerce. 

Applicants who do not meet the 

standards established herein will not be 

eligible to receive USML or CCL 

property. 

DATES: Consideration will be given to all 

comments received by December 26, 

2006. 

ADDRESSES: You may submit comments, 

identified by docket number and or RIN 

number and title, by any of the 

following methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

• Mail: Federal Docket Management 

System Office, 1160 Defense Pentagon, 

Washington, DC 20301–1160. 

Instructions: All submissions received 

must include the agency name and 

docket number or Regulatory 

Information Number (RIN) for this 

Federal Register document. The general 

policy for comments and other 

submissions from members of the public 

is to make these submissions available 

for public viewing on the Internet at 

http://www.regulations.gov as they are 

received without change, including any 

personal identifiers or contact 

information. 

FOR FURTHER INFORMATION CONTACT: Mr. 

Mark Vincent, Defense Logistics Agency 

Criminal Investigations Activity, 8725 

John J. Kingman Road, Suite 2358, Fort 

Belvoir, VA 22060, (703) 767–2507 or email mark.d.vincent@dla.mil. 

SUPPLEMENTARY INFORMATION: The use of 

the Qualified Trading Partner (QTP) is 

intended to limit transfers of USML/ 

CCL to those who have been assessed 

and determined to have the capacity 

and propensity to properly handle, 

control, and lawfully dispose of or 

export USML/CCL. The process is 

intended to reduce risk without 

adversely impacting lawful commerce of 

these items. Use of the QTP application 

will reduce the likelihood that 

recipients present a risk to misuse the 

material and help ensure the applicants 

have the capability to properly handle 

such items. Implementation of QTP 

application criteria will improve the 

assessment process. Where the QTP 

Application needs to be done only once 

each 5 years, continued use of the EUC 

allows visibility of each transaction and 

the specific factors associated with just 

that transaction. 

Executive Order 12866, ‘‘Regulatory 

Planning and Review’’

It has been determined that 32 CFR 

part 161 is not a significant regulatory 

action. The rule does not: 

(1) Have an annual effect on the 

economy of $100 million or more or 

adversely affect in a material way the 

economy; a section of the economy; 

productivity; competition; jobs; the 

environment; public health or safety; or 

State, local, or tribal governments or 

communities; 

(2) Create a serious inconsistency or 

otherwise interfere with an action taken 

or planned by another Agency; 

(3) Materially alter the budgetary 

impact of entitlements, grants, user fees, 

or loan programs, or the rights and 

obligations of recipients thereof; or 

(4) Raise novel legal or policy issues 

arising out of legal mandates, the 

President’s priorities, or the principles 

set forth in this Executive Order. 

Unfunded Mandates Reform Act (Sec. 

202, Pub. L. 104–4) 

It has been certified that this rule does 

not contain a Federal mandate that may 

mstockstill on PROD1PC61 with PROPOSALS