This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

15645 

Vol. 78, No. 48 

Tuesday, March 12, 2013 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Parts 60 and 65 

[Document No. AMS–LS–13–0004] 

RIN 0581–AD29 

Mandatory Country of Origin Labeling 

of Beef, Pork, Lamb, Chicken, Goat 

Meat, Wild and Farm-Raised Fish and 

Shellfish, Perishable Agricultural 

Commodities, Peanuts, Pecans, 

Ginseng, and Macadamia Nuts 

AGENCY: Agricultural Marketing Service 

(AMS), USDA. 

ACTION: Proposed rule. 

SUMMARY: This proposed rule would 

amend the Country of Origin Labeling 

(COOL) regulations to change the 

labeling provisions for muscle cut 

covered commodities to provide 

consumers with more specific 

information, and amend the definition 

for ‘‘retailer’’ to include any person 

subject to be licensed as a retailer under 

the Perishable Agricultural 

Commodities Act (PACA). The COOL 

regulations are issued pursuant to the 

Agricultural Marketing Act of 1996. The 

Agency is issuing this rule to propose 

changes to the labeling provisions for 

muscle cut covered commodities to 

provide consumers with more specific 

information and is proposing other 

modifications to enhance the overall 

operation of the program. 

DATES: Comments must be submitted on 

or before April 11, 2013. 

ADDRESSES: Interested persons may 

submit written comments on this 

proposed rule using the following 

address: 

Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

Instructions: All submissions received 

must include the docket number AMS– 

LS–13–0004; and/or Regulatory 

Information Number (RIN)0581–AD29 

for this rulemaking. Comments may also 

be submitted to Julie Henderson, 

Director, COOL Division, Livestock, 

Poultry, and Seed Program, Agricultural 

Marketing Service, U.S. Department of 

Agriculture (USDA); STOP 0216; 1400 

Independence Avenue SW., Room 

2620–S; Washington, DC 20250–0216. 

All comments should reference docket 

number AMS–LS–13–0004 and note the 

date and page number of this issue of 

the Federal Register. 

Submitted comments will be available 

for public inspection at http:// 

www.regulations.gov or at the above 

address during regular business hours. 

Comments submitted in response to this 

proposed rule will be included in the 

records and will be made available to 

the public. Please be advised that the 

identity of the individuals or entities 

submitting the comments will be made 

public on the Internet at the above 

address. 

FOR FURTHER INFORMATION CONTACT: Erin 

Morris, Deputy Associate Administrator, 

AMS, USDA, by telephone on 202/690– 

4024, or via email at: 

erin.morris@ams.usda.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

The Farm Security and Rural 

Investment Act of 2002 (2002 Farm Bill) 

(Pub. L. 107–171), the 2002 

Supplemental Appropriations Act (2002 

Appropriations) (Pub. L. 107–206), and 

the Food, Conservation and Energy Act 

of 2008 (2008 Farm Bill) (Pub. L. 110– 

234) amended the Agricultural 

Marketing Act of 1946 (Act) (7 U.S.C. 

1621 et seq.) to require retailers to notify 

their customers of the country of origin 

of covered commodities. Covered 

commodities include muscle cuts of 

beef (including veal), lamb, chicken, 

goat, and pork; ground beef, ground 

lamb, ground chicken, ground goat, and 

ground pork; wild and farm-raised fish 

and shellfish; perishable agricultural 

commodities; macadamia nuts; pecans; 

ginseng; and peanuts. AMS published a 

final rule for all covered commodities 

on January 15, 2009 (74 FR 2658), which 

took effect on March 16, 2009. 

Executive Summary 

Purpose of the Regulatory Action 

In June 2012, in a WTO case brought 

by Mexico and Canada, the WTO 

Appellate Body (AB) affirmed a 

previous WTO Panel’s finding that the 

COOL requirements for muscle cut meat 

commodities were inconsistent with 

U.S. obligations under the WTO 

Agreement on Technical Barriers to 

Trade (TBT Agreement). In particular, 

the AB affirmed the Panel’s 

determination that the COOL 

requirements were inconsistent with the 

TBT Agreement’s national treatment 

obligation to accord imported products 

treatment no less favorable than that 

accorded to domestic products. The 

WTO Dispute Settlement Body adopted 

its recommendations and rulings on July 

23, 2012. The United States has until 

May 23, 2013, to comply with the WTO 

ruling. 

As a result of this action, the Agency 

reviewed the overall regulatory program 

and is issuing this rule, under the 

authority of the Agricultural Marketing 

Act (7 U.S.C. 1621 et seq.), to propose 

changes to the labeling provisions for 

muscle cut covered commodities and 

other modifications to improve the 

overall operation of the program. The 

Agency expects that these changes will 

improve the overall operation of the 

program and also bring the current 

mandatory COOL requirements into 

compliance with U.S. international 

trade obligations. 

Summary of the Major Provisions of the 

Regulatory Action in Question 

Under this proposed rule, origin 

designations for muscle cut covered 

commodities derived from animals 

slaughtered in the United States would 

be required to specify the production 

steps of birth, raising, and slaughter of 

the animal from which the meat is 

derived that took place in each country 

listed on the origin designation. In 

addition, this proposed rule would 

eliminate the allowance for any 

commingling of muscle cut covered 

commodities of different origins. These 

changes will provide consumers with 

more specific information about muscle 

cut covered commodities. 

Costs and Benefits 

The major cost of implementing the 

proposed amendments will be incurred 

at the packing or processing facility, in 

the case of pre-labeled products, or at 

the retail level, in the case of products 

labeled at retail. The estimated number 

of firms that would need to augment 

labels for muscle cut covered 

commodities is 2,808 livestock 

processing and slaughtering firms, 38 

chicken processing firms, and 4,335 

retailers. This totals 7,181 firms that 


pmangrum on DSK3VPTVN1PROD with PROPOSALS
15646 Federal Register / Vol. 78, No. 48 / Tuesday, March 12, 2013 / Proposed Rules 

would need to augment the mandatory 

COOL information presented on labels 

for muscle cut covered commodities. 

Based on 2009 data, the Food Safety 

and Inspection Service (FSIS) estimated 

there were approximately 121,350 raw 

meat and poultry unique labels 

submitted by official establishments 

(i.e., establishments regulated by FSIS) 

and approved by the Agency (76 FR 

44862). Assuming the upper bound 

estimate of 121,350 unique labels, the 

Agency preliminarily estimates the 

midpoint cost of the proposed rule for 

this label change is $32,764,500 with a 

range of $16,989,000 to $47,326,500. 

The Agency believes that the 

incremental economic benefits from the 

proposed labeling of production steps 

will be comparatively small relative to 

those that were discussed in the 2009 

final rule. 

A complete discussion of the cost and 

benefits can be found under the 

Executive Order 12866 section. 

Summary of Proposed Changes to the 

COOL Regulations 

Definitions 

In the regulatory text for fish and 

shellfish (7 CFR part 60) and for all 

other covered commodities (7 CFR part 

65), the definition for ‘‘retailer’’ is 

proposed to be amended to include any 

person subject to be licensed as a 

retailer under the Perishable 

Agricultural Commodities Act (PACA) 

of 1930 (7 U.S.C. 499a(b)). This change 

would more closely align with the 

language contained in the PACA 

regulation and would help clarify that 

all retailers that meet the PACA 

definition of a retailer, whether or not 

they actually have a PACA license, are 

also covered by COOL. 

Proposed Changes to the Labeling 

Provisions for Muscle Cut Covered 

Commodities 

As a result of the Agency’s review of 

the program regulations, the Agency is 

proposing to require that all origin 

designations for muscle cut covered 

commodities slaughtered in the United 

States specify the production steps of 

birth, raising, and slaughter of the 

animal from which the meat is derived 

that took place in each country listed on 

the origin designation. The requirement 

to include this information will apply 

equally to all muscle cut covered 

commodities derived from animals 

slaughtered in the United States. This 

requirement will provide consumers 

with more specific information on 

which to base their purchasing 

decisions without imposing additional 

recordkeeping requirements on 

industry. The Agency considers that 

these changes, which are discussed in 

detail below, are consistent with the 

provisions of the statute. 

Labeling Covered Commodities of 

United States Origin 

Under the current COOL regulations, 

for muscle cut covered commodities 

derived from animals that were born, 

raised, and slaughtered in the United 

States, the origin is allowed to be 

designated as ‘‘Product of the U.S.’’ 

Under this proposed rule, the United 

States country of origin designation for 

muscle cut covered commodities would 

be required to include location 

information for each of the production 

steps (i.e., ‘‘Born, Raised, and 

Slaughtered in the United States’’). 

Labeling Muscle Cut Covered 

Commodities of Multiple Countries of 

Origin (From Animals Slaughtered in 

the United States) 

For muscle cut covered commodities 

of multiple countries of origin that 

include the United States, the current 

COOL regulations recognize two basic 

scenarios. 

The first scenario deals with meat 

derived from animals that were born in 

another country (and thereby raised for 

a period of time) and were imported as 

feeder cattle that were further raised and 

slaughtered in the United States. For 

these products, current COOL 

regulations allow the origin to be 

designated as ‘‘Product of the U.S. and 

Country X.’’ Under this proposed rule, 

as with U.S.-only origin products, the 

origin designation for these products 

would be required to include location 

information for each of the production 

steps. 

However, as discussed in the 

preamble of the January 15, 2009, final 

rule (74 FR 2658), if animals are raised 

in another country and the United 

States, the raising that occurs in the 

United States may take precedence over 

the minimal raising that occurred in the 

animal’s country of birth. Accordingly, 

under this proposed rule, the 

production step related to any raising 

occurring outside the United States may 

be omitted from the origin designation 

of these products (e.g., ‘‘Born in Country 

X, Raised and Slaughtered in the United 

States’’ in lieu of ‘‘Born and Raised in 

Country X, Raised and Slaughtered in 

the United States’’). 

This omission is not permitted in the 

relatively rare situation where an animal 

was born in the United States, raised in 

another country (or countries) and then 

raised and slaughtered in the United 

States, which would result in the 

muscle cut covered commodity being 

designated as having a solely U.S. 

country of origin. 

The second scenario relates to muscle 

cut covered commodities derived from 

animals that were imported for 

immediate slaughter as defined in 

§ 65.180. In this scenario, under the 

current COOL regulations, these 

products are required to be designated 

as ‘‘Product of Country X and the 

United States.’’ 

Under this proposed rule, the origin 

designation for meat derived from 

animals imported for immediate 

slaughter would be required to include 

information as to the production steps 

taking place in the countries listed on 

the origin designation. However, the 

country of raising for animals imported 

for immediate slaughter as defined in 

§ 65.180 shall be designated as the 

country from which they were imported 

(e.g., ‘‘Born and Raised in Country X, 

Slaughtered in the United States’’). 

Commingling 

The current COOL regulations allow 

for commingling of different origins. For 

example, under the current COOL 

regulations, for muscle cut covered 

commodities derived from animals 

born, raised, and slaughtered in the 

United States that are commingled 

during a production day with muscle 

cut covered commodities derived from 

animals that were raised and 

slaughtered in the United States, and are 

not derived from animals imported for 

immediate slaughter as defined in 

§ 65.180, the origin is allowed to be 

designated, for example, as Product of 

the United States, Country X, and (as 

applicable) Country Y. Similarly, under 

the current COOL regulations, for 

muscle cut covered commodities 

derived from animals that are born in 

Country X or Country Y, raised and 

slaughtered in the United States, that 

were commingled during a production 

day with muscle cut covered 

commodities that were derived from 

animals that are imported into the 

United States for immediate slaughter as 

defined in § 65.180, the origin is 

allowed to be designated as Product of 

the United States, Country X, and (as 

applicable) Country Y. 

This proposed rule would eliminate 

the allowance for any commingling of 

muscle cut covered commodities of 

different origins. As discussed above, all 

origin designations would be required to 

include specific information as to the 

place of birth, raising, and slaughter of 

the animal from which the meat is 

derived. Removing the commingling 

allowance allows consumers to benefit 

from more specific labels. 


pmangrum on DSK3VPTVN1PROD with PROPOSALS
Federal Register / Vol. 78, No. 48 / Tuesday, March 12, 2013 / Proposed Rules 15647 

Labeling Imported Muscle Cut Covered 

Commodities 

Under the current COOL regulations, 

imported muscle cut covered 

commodities retain their origin as 

declared to the U.S. Customs and Border 

Protection at the time the products 

entered the United States (i.e., Product 

of Country X) through retail sale. 

Under this proposed rule, these 

labeling requirements for imported 

muscle cut covered commodities remain 

unchanged, although the Agency has 

restructured the regulatory text of this 

provision for clarity. As is permitted 

under the current COOL regulations, the 

Agency will continue to allow the origin 

designation to include more specific 

information related to production steps, 

provided records to substantiate the 

claims are maintained and the claim is 

consistent with other applicable Federal 

legal requirements. 

Executive Order 13175 

This rule has been reviewed in 

accordance with the requirements of 

Executive Order 13175, Consultation 

and Coordination with Indian Tribal 

Governments. The review reveals that 

this regulation will not have substantial 

and direct effects on Tribal governments 

and will not have significant Tribal 

implications. 

Executive Order 12866 and Executive 

Order 13563 

Executive Orders 12866 and 13563 

direct agencies to assess all costs and 

benefits of available regulatory 

alternatives, and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). Executive Order 13563 

emphasizes the importance of 

quantifying both costs and benefits, of 

reducing costs, of harmonizing rules, 

and of promoting flexibility. This 

proposed rule has been designated as a 

‘‘significant regulatory action’’ under 

section 3(f) of Executive Order 12866, 

and, therefore, has been reviewed by the 

Office of Management and Budget 

(OMB). The Agency seeks comments 

and data on the estimated impacts of 

this rulemaking that may affect its 

designation under Executive Order 

12866 and the Congressional Review 

Act. 

Regulations must be designed in the 

most cost-effective manner possible to 

obtain the regulatory objective while 

imposing the least burden on society. 

This proposed rule would amend the 

COOL regulations (1) to change the 

labeling provisions for muscle cut 

covered commodities to provide 

consumers with more specific 

information and (2) to amend the 

definition for ‘‘retailer’’ to include any 

person subject to be licensed as a 

retailer under the Perishable 

Agricultural Commodities Act (PACA) 

to enhance the overall operation of the 

program. 

Initial Analysis of Benefits and Costs 

The baseline for this analysis is the 

present state of the beef, chicken, goat, 

lamb and pork industries, which have 

been subject to the requirements of 

mandatory COOL (7 CFR parts 60 and 

65) since the effective date of the final 

rule on March 16, 2009. Under this 

proposed rule, COOL requirements 

would remain essentially unchanged for 

imported muscle cut covered 

commodities. However, labeling 

requirements would change for muscle 

cut covered commodities derived from 

animals slaughtered in the United 

States—whether exclusively of United 

States origin, of multiple countries of 

origin that include the United States, or 

imported for immediate slaughter in the 

United States. For those products, 

covered retailers would need to inform 

their consumers of the country in which 

the relevant production steps—born, 

raised, and slaughtered—occurred. 

As mentioned above in the summary 

of proposed changes to the COOL 

regulations, the definition for ‘‘retailer’’ 

would be amended to more closely align 

with the language contained in the 

PACA regulation and help clarify that 

all retailers that meet the PACA 

definition of a retailer, whether or not 

they actually have a PACA license, are 

covered by COOL. The Agency believes 

that this change in definition will not 

substantially alter the number of 

retailers subject to the COOL 

regulations. Therefore, the analysis of 

benefits and cost from this proposed 

rule focuses solely on the potential 

effects of the proposed amendments to 

the labeling provisions of the current 

COOL regulations. 

Benefits: In the time since the Agency 

conducted the previous COOL 

regulation’s Preliminary Economic 

Impact Analysis (PRIA) in 2003 (68 FR 

61952) and the Final Regulatory Impact 

Analysis (FRIA) in 2009 (74 FR 2682), 

a number of studies have been 

published regarding the economic 

effects of mandatory COOL. However, 

the available literature has not 

addressed the potential benefits and 

costs of providing more specific 

information on production steps as 

proposed herein. As observed in the 

PRIA and the FRIA, the expected 

benefits from implementing mandatory 

COOL requirements remain difficult to 

quantify. This conclusion holds true for 

the proposed amendments to the 

labeling requirements under the current 

COOL regulations. The Agency invites 

comment on the benefits of this 

proposed rule and welcomes data that 

would help to inform a more 

quantifiable analysis. 

Numerous comments received on 

previous COOL rulemaking actions 

indicate that there is interest by some 

consumers in the designation of the 

countries of birth, raising and slaughter 

on meat product labels. Specifying the 

production step occurring in each 

country listed on meat labels as 

proposed in this rule could provide 

additional benefits by providing more 

specific information on which 

consumers can base their purchasing 

decisions. 

In addition, this proposed rule would 

eliminate the allowance for 

commingling of muscle cut covered 

commodities of different origins. As 

discussed in the preamble, removing the 

commingling allowance will allow the 

labels proposed under this rule to 

provide specific information as to the 

place of birth, raising, and slaughter of 

the animal from which the meat is 

derived. 

The Agency has been unable to 

quantify incremental economic benefits 

from the proposed labeling of 

production steps and therefore requests 

detailed comment and data on this 

issue, most notably detailed data or 

studies on the value to consumers of 

having COOL information. The Agency 

concluded in the PRIA and FRIA that 

the economic benefits from the COOL 

requirements are positive, but difficult 

to quantify. The Agency believes that 

incremental economic benefits from the 

proposed labeling of production steps 

are difficult to quantify, and will be 

comparatively small relative to those 

that were discussed in the 2009 final 

rule. 

Costs: Two conditions are necessary 

to inform retail consumers of the 

location in which production steps 

occurred. First, the relevant information 

must be collected by packers from 

producers and then passed to retailers. 

Second, the information must be made 

available by retailers to consumers 

through a placard, sign, label, sticker, or 

other format. Because of the steps that 

have been taken to achieve compliance 

with existing mandatory COOL 

requirements, the first condition has 

been met. That is, we do not anticipate 

that this proposed rule will require 

additional recordkeeping or any new 

systems to transfer information from one 


pmangrum on DSK3VPTVN1PROD with PROPOSALS
15648 Federal Register / Vol. 78, No. 48 / Tuesday, March 12, 2013 / Proposed Rules 

1For a discussion of various studies regarding the 

extent of segregation and commingling, see 

Appellate Body Reports, US—Certain Country of 

Origin Labelling (COOL) Requirements, WT/DS384/ 

R, WT/DS386/R, paras. 295–310 (adopted July 23, 

2012); Panel Reports, United States—Certain 

Country of Origin Labelling (COOL) Requirements, 

paras. 7.365, 7.403 (adopted July 23, 2012). 

2 ‘‘A Snapshot of Today’s Retail Meat Case: 2010 

National Meat Case Study Executive Summary.’’ 

http://www.beefretail.org/CMDocs/BeefRetail/ 

research/2010NationalMeatCaseStudy.pdf. 

level of the production and marketing 

channel to the next. The Agency is 

seeking comment on these assumptions 

and welcomes data that would help to 

inform a more refined analysis of the 

impacts of the rule at various points in 

production. The information provided 

to consumers at retail would be 

augmented to include information on 

the location(s) in which the three major 

phases of production occurred. Thus 

some incremental costs of implementing 

the proposed amendments would result 

from modifying the label (or other 

format) to reflect the additional 

production step information. We are 

specifically asking for comment and 

data regarding the extent to which there 

may be additional costs to collect and 

transmit data along the production and 

marketing chain, and how current 

production, distribution, and retail 

merchandising practices may be affected 

by the proposed rule. 

As previously mentioned, no changes 

are being proposed to the existing 

country of origin labeling of imported 

muscle cuts derived from animals 

slaughtered in another country. Those 

products would continue to retain their 

origin as declared to the U.S. Customs 

and Border Protection at the time the 

products entered the United States 

through retail sale. Thus, there are no 

incremental costs associated with that 

scenario. 

However, in the situation in which 

the covered muscle cut commodities are 

derived from animals slaughtered in the 

United States, labeling of the location(s) 

in which the animal was born, raised, 

and slaughtered would now be required. 

Packers and processors that provide 

muscle cut covered commodities to 

covered retailers, however, already 

obtain this production step information 

needed either to pre-label retail caseready products with production step 

information or to provide that 

information to their retail customers. In 

the latter scenario, the retailer would 

then complete the labeling of the 

production steps to provide notification 

to consumers. 

Under current mandatory COOL 

requirements, packers and processors 

must inform their retail customers as to 

the country of origin of the meat cuts 

that they supply. In turn, that means 

that packers and processors must obtain 

the country of origin information from 

their supply chain. Thus, the 

information on production steps 

required by this proposal is already 

available due to the current mandatory 

COOL requirements. The additional 

costs attributable to the proposed 

amendments would be the costs 

associated with transferring production 

step information to the product label. 

For animals exclusively born, raised, 

and slaughtered in the United States, 

current labeling requirements would be 

augmented from, for example, ‘‘Product 

of the U.S.’’ to ‘‘Born, Raised and 

Slaughtered in the U.S.’’ In this 

example, the required statement 

increases from 19 to 40 characters and 

spaces. For animals born in another 

country and raised and slaughtered in 

the United States, current labeling 

requirements would be augmented from, 

for example, ‘‘Product of U.S. and 

Country X’’ to ‘‘Born in Country X, 

Raised and Slaughtered in the U.S.’’ 

Finally, for an animal imported for 

immediate slaughter, current labeling 

requirements would be augmented from, 

for example, ‘‘Product of Country X and 

the U.S.’’ to ‘‘Born and Raised in 

Country X, Slaughtered in the U.S.’’ In 

these examples, the required statement 

increases by a net of 20 characters and 

spaces. 

In addition, commingling currently 

allowed under the current mandatory 

COOL regulations would no longer be 

available under the proposed 

amendments. For example, the current 

regulations allow muscle cut covered 

commodities derived from animals 

born, raised, and slaughtered in the 

United States that are commingled 

during a production day with muscle 

cut covered commodities derived from 

animals born in one or more other 

countries to be designated as, for 

example, ‘‘Product of the United States, 

Country X, and Country Y’’ 

(§ 65.300(e)(2)). That type of 

commingling would not be allowed 

under the proposed amendments, as the 

labels must be specific as to where the 

animal was born, raised, and 

slaughtered. 

The Agency’s experience with the 

current program suggests that the 

majority of muscle cut covered 

commodities are not produced and 

labeled using the labeling scheme 

afforded by commingling. The Agency 

invites comment and data regarding the 

extent to which the flexibility afforded 

by commingling on a production day is 

used to designate the country of origin 

under the current COOL program and 

the potential costs, such as labor and 

capital costs, which may result from the 

loss of such flexibility. 

Given that the information needed to 

label production steps is already 

available and that most packers already 

segregate animals of differing countries 

of origin in the slaughter and processing 

of those animals,1 the most widespread 

cost of implementing the proposed 

amendments is expected to be related to 

label change; this cost would be 

incurred partially at the packing or 

processing facility and partially at the 

retail level. 

In the FRIA published in the earlier 

COOL rulemaking (74 FR 2681), firstyear incremental implementation costs 

for mandatory COOL were estimated at 

$1,755 million for the beef, pork, lamb 

and goat, and chicken industries. Of that 

total, intermediary suppliers and 

retailers were estimated to incur costs of 

$618 million and $716 million 

respectively, for a total of $1,334 

million. Applying a Consumer Price 

Index deflator of 1.07 to convert to 2012 

dollar values, first-year implementation 

costs for startup of mandatory COOL 

was estimated at $661 million for 

intermediaries, $766 million for 

retailers, and $1,427 million for both 

industry segments. AMS believes that 

packer and processor intermediary 

suppliers and retailers would be able to 

add the proposed specific production 

step information to currently required 

COOL designations at considerably 

lower cost than required for initial 

implementation of the current COOL 

regulations. 

In a 2010 survey of retail meat cases, 

31 percent of beef, 58 percent of pork, 

60 percent of lamb, and 94 percent of 

chicken packages were case ready 

packages.2 For retailers, products prelabeled with production step locations 

would require no additional costs, as 

suppliers would add the production 

step information. Retailers offering case 

ready packages that do not include the 

production step information required 

under this proposed rule would need to 

communicate that information to 

consumers by some other means, such 

as placards or stickers. The Agency 

requests comment and data on the 

means retailers would utilize to 

communicate the production step 

information required by this proposed 

rule. 

The estimated number of firms that 

would need to augment labels for 

muscle cut covered commodities is 

2,808 livestock processing and 

slaughtering firms, 38 chicken 


pmangrum on DSK3VPTVN1PROD with PROPOSALS
Federal Register / Vol. 78, No. 48 / Tuesday, March 12, 2013 / Proposed Rules 15649 

3Model to Estimate Costs of Using Labeling as a 

Risk Reduction Strategy for Consumer Products 

Regulated by the Food and Drug Administration, 

FDA, March 2011 (Contract No. GS–10F–0097L, 

Task Order 5). 

processing firms, and 4,335 retailers 

(Table 1). This totals 7,181 firms that 

would need to augment the mandatory 

COOL information presented on labels 

for muscle cut covered commodities. 

Cost estimates provided in a March 

2011, Food and Drug Administration 

(FDA) report 3 represent one possible 

approach for estimating the cost of 

including the additional production 

step information to currently required 

COOL labels for muscle cut covered 

commodities. There are limitations, 

however, to the applicability of the FDA 

label cost model to the task faced by 

retailers in informing consumers of the 

production step locations as proposed 

herein. 

Importantly, the FDA model was 

developed for all products subject to 

FDA regulation, which includes not 

only food, but cosmetics, dietary 

supplements, over-the-counter 

medications, pet foods, retail medical 

devices, and tobacco products and 

accessories. Most of the products 

covered by these categories are sold in 

fixed-volume or fixed-quantity packages 

that are labeled by the manufacturer, 

processor, or distributor, with no 

additional labeling added by the 

retailer. 

However, this proposed rule covers 

muscle cut covered commodities, which 

notably fall outside of FDA’s 

jurisdiction (and are not included 

within the model). As noted previously, 

unlike the FDA covered commodities, a 

significant percentage of muscle cut 

covered commodities are sold in 

random-weight packages, with the final 

weight and price label applied by the 

retailer. Typically, retailers use a label 

printing scale with a thermal dot printer 

to apply the unit price, weight, total 

price, and other information such as the 

product name, sell by date, and so forth 

on pressure-sensitive paper labels that 

are applied to packages prior to sale. 

This important difference between the 

products covered by this rule and the 

products contemplated by FDA in 

creating its model indicates to the AMS 

that it would be inappropriate to rigidly 

adhere to the model for purposes of this 

analysis, as such an application of the 

model will overestimate the label 

change costs of this rule. 

Nevertheless, despite these important 

limitations, the Agency does consider 

that the FDA model, with some 

qualifications can contribute to an 

assessment of the potential impacts of 

the proposed requirements. In the 

context of the FDA model, the proposed 

labeling change is assumed to be a 

minor change in which only one color 

is affected and the label does not need 

to be redesigned. Examples of a minor 

label change include the addition of a 

toll-free number, or more pertinent in 

this case, minimal changes to a claim on 

the back or side of a package affecting 

one color. 

Based on 2009 data, the Food Safety 

and Inspection Service (FSIS) estimated 

there were approximately 121,350 raw 

meat and poultry unique labels 

submitted by official establishments and 

approved by the Agency (76 FR 44862). 

This number would represent an upper 

bound on the number of unique labels 

that would be affected by this proposed 

rule, as there are raw meat and poultry 

products that are exempt from COOL 

requirements, (such as a teriyaki 

flavored pork loin and other processed 

food items as defined by § 65.220) or 

that are not affected by this proposed 

rule (such as turkey), and that are not 

sold at retail establishments (such as 

products sold to hotels, restaurants, and 

institutional customers). The Agency 

welcomes data that would account for 

such products and thus allow for 

refinement of the estimate of the 

number of labels affected by the 

proposed rule. 

Label changes in the FDA model fall 

on a spectrum from being 

uncoordinated, in which the label 

change does not correspond to a 

planned change, or coordinated, in 

which the label change corresponds 

with a planned change. The model 

predicts that coordinated label changes 

incur lower costs compared to 

uncoordinated changes. The Agency 

recognizes that costs estimates under 

the FDA model are greatly affected by 

the time over which required labeling 

changes are phased in. In the case of 

food products under the FDA model, 

any compliance period of less than 12 

months is assumed to be an 

uncoordinated change, with 100 percent 

coordinated changes assumed to require 

at least 24 months for branded foods 

and 42 months for private label foods. 

The model predicts that coordinated 

label changes incur significantly lower 

costs compared to uncoordinated 

changes. 

For the reasons explained above, the 

Agency does not believe that the rigid 

application of the FDA model will 

accurately predict the costs of this rule. 

In particular, the Agency does not 

consider that the distinction between 

coordinated and uncoordinated label 

changes as applied in the FDA label cost 

model is predictive of the costs of this 

rule. Rather, the Agency preliminarily 

estimates that label changes proposed in 

this rule will create costs that 

correspond to a coordinated change, 

even if the Agency ultimately decides to 

require a phase in that is considerably 

shorter than 12 months, which the FDA 

model assumes is a 100 percent 

uncoordinated label change. 

Under the FDA model, one-time costs 

for a coordinated label change are 

assumed to involve only administrative 

labor costs and recordkeeping. However, 

as previously discussed, no additional 

recordkeeping costs are anticipated from 

this proposed rule. The midpoint 

estimate of administrative labor cost for 

a coordinated label change is $270, with 

a range of $140–$390. For an 

uncoordinated label change, the model 

includes administrative labor costs, 

non-administrative labor costs, 

materials costs that vary with the type 

of material and printing method, and 

recordkeeping costs. Again, no 

additional recordkeeping costs are 

anticipated from this proposed rule, and 

therefore the Agency considers that the 

model’s predictions regarding 

uncoordinated label changes would 

significantly overstate the costs of the 

label change proposed here. As a point 

of reference, depending on the printing 

method, low estimates for coordinated 

change under the FDA model range 

from $1,990 to $2,940; midpoint 

estimates range from $3,690 to $4,980; 

and high estimates range from $6,500 to 

$7,890. 

There are additional distinctions 

between the FDA model and the COOL 

regime to support the conclusion that 

the model’s assumptions regarding 

coordinated versus uncoordinated label 

changes have limited applicability in 

this situation. As previously mentioned, 

COOL information already is made 

available to consumers under current 

regulations, and that information can be 

provided through a variety of means, 

including placards, signs, labels, 

stickers, or other formats. Thus, the 

Agency believes that the label changes 

contemplated in this proposed rule 

could be phased in with similar costs as 

predicted for a coordinated label change 

under the model. For instance, placards 

could be used to convey the augmented 

production step information pending 

synchronization with a coordinated 

label change cycle. Also, many, if not 

most, of the muscle cut covered 

commodities are sold as random-weight 

items with price, weight, and other 

information (including COOL 

information) printed for each individual 

package, thus allowing production step 

information to be provided in a similar 

manner. Assuming the upper bound 

estimate of 121,350 unique labels, the 


pmangrum on DSK3VPTVN1PROD with PROPOSALS
15650 Federal Register / Vol. 78, No. 48 / Tuesday, March 12, 2013 / Proposed Rules 

estimated midpoint cost of the proposed 

rule for a label change is $32,764,500 

with a range of $16,989,000 to 

$47,326,500 million. 

Note that the number of unique labels 

affected by this proposed rule is 

expected to be lower than the upperbound estimate of 121,350, thus 

lowering the total estimated costs 

commensurately. Conversely, 

coordinating the proposed label changes 

with the current COOL requirements 

may involve additional costs that have 

not been included, which would result 

in higher overall costs than are 

estimated here. 

Furthermore, compared to the current 

COOL program, the changes 

contemplated by the proposed 

amendments may involve ongoing 

activities beyond label redesign. For 

example, without the commingling 

possible under the current program, 

there may be a more frequent need to 

switch labels at processing plants that 

may currently commingle meat or enter 

different information into a label 

machine at a retail store when 

production step information changes. A 

given lot of carcasses or a box of meat 

from a production day may be of one 

origin, while the next lot or box may be 

of another origin. As previously 

explained, under some scenarios, under 

current COOL regulations, the same 

COOL designation can be applied to the 

entire day’s production. Under the 

proposed amendments, however, the 

COOL designation would need to reflect 

the appropriate birth and raising 

country of origin information along with 

the United States location of 

slaughtering for individual muscle cuts 

of meat. 

The Agency invites public comment 

and associated quantitative data that 

would improve the Agency’s estimate of 

the cost of the changes in the labeling 

and commingling requirements being 

proposed in this rulemaking, including 

any additional costs that have not been 

included in the estimates discussed 

above. The Agency also invites public 

comment on how the length of time for 

compliance will affect the cost of the 

changes being proposed in this rule. 

TABLE 1—ESTIMATED NUMBER OF AFFECTED ENTITIES, SHARE OF FIRMS BY SIZE, AND LABELING COST OF RULE

REVISION * 

NAICS Code NAICS Description Enterprise size 

criteria 

Number of 

firms 

Number of 

establishments 

Share of 

firms by 

size 

(%) 

Estimated cost 

of rule 

revision 

311611 ................ Animal (except Poultry) 

Slaughtering.

<500 Employees ............ 1,504 1,518 97.6 $1,491,344 

500+ Employees ............ 37 115 2.4 112,981 

Total .................... 1,541 1,633 .................... 1,604,325 

311612 ................ Meat Processed from 

Carcasses.

<500 Employees ............ 1,203 1,232 94.9 1,201,366 

500+ Employees ............ 64 173 5.1 169,962 

Total .................... 1,267 1,405 .................... 1,380,328 

311615 ................ Chicken Processing ....... <500 Employees ............ 36 N/A 94.7 N/A 

500+ Employees ............ 2 N/A 5.3 N/A 

Total .................... 38 156 .................... 153,261 

445110 ................ Supermarkets and Other 

Grocery (except Convenience) Stores, 

Sales >$5,000,000.

<$50,000,000 Sales ....... 4,106 6,050 95.0 5,943,762 

$50,000,000+ Sales ....... 217 19,846 5.0 19,497,504 

Total .................... 4,323 25,896 .................... 25,441,266 

452910 ................ Warehouse Clubs and 

Supercenters.

<$50,000,000 Sales ....... 0 0 .................... ..............................

$50,000,000+ Sales ....... 12 4,260 100.0 4,185,194 

Total .................... 12 4,260 .................... 4,185,195 

GRAND TOTAL ............. 7,181 33,350 .................... 32,764,500 

* We assume that each establishment, regardless of size or industry, incurs the average estimated label revision cost per establishment = 

$982.44. Numbers may not sum due to rounding. 

SOURCE: 2007 County Business Patterns and 2007 Economic Census. 

Initial Regulatory Flexibility Analysis 

This rule has been reviewed under the 

requirements of the Regulatory 

Flexibility Act (RFA) (5 U.S.C. 601 et 

seq.). The purpose of the RFA is to 

consider the economic impact of a rule 

on small businesses and evaluate 

alternatives that would accomplish the 

objectives of the rule without unduly 

burdening small entities or erecting 

barriers that would restrict their ability 

to compete in the marketplace. The 

Agency believes that this rule will have 

a relatively small economic impact on a 

substantial number of small entities. As 

such, the Agency has prepared the 

following initial regulatory flexibility 

analysis of the rule’s likely economic 

impact on small businesses pursuant to 

section 603 of the RFA. 

As mentioned in the summary above, 

this rulemaking was contemplated after 

the Agency reviewed the overall 

regulatory program in light of the 

WTO’s finding that the current 

mandatory COOL measure is 

inconsistent with the United States’ 

WTO obligations. The objective of this 

proposed rulemaking is to amend 

current mandatory COOL requirements 

to provide consumers with information 

on the country in which productions 

steps occurred for muscle cut covered 


pmangrum on DSK3VPTVN1PROD with PROPOSALS
Federal Register / Vol. 78, No. 48 / Tuesday, March 12, 2013 / Proposed Rules 15651 

4Small Business Administration. http:// 

www.sba.gov/sites/default/files/files/ 

Size_Standards_Table(1).pdf. 

5ERS, USDA. Food CPI, Prices and Expenditures: 

Sales of Food at Home by Type of Outlet. http:// 

www.ers.usda.gov/Briefing/ 

CPIFoodAndExpenditures/Data/table16.htm. 

6U.S. Census Bureau. 2007 Economic Census. 

Retail Trade Subject Series. Establishment and Firm 

Size. EC0744SSSZ4 and. Issued January 2013. 

7U.S. Census Bureau. 2007 Economic Census. 

Historical Data Tabulations by Enterprise Size. 2007 

Annual Tabulations: U.S., All Industries. http:// 

www.census.gov/econ/susb/data/susb2007.html. 

commodities, thus fulfilling the 

program’s objective of providing 

consumers with information on origin. 

The legal basis for the mandatory COOL 

regulations is Subtitle D of the 

Agricultural Marketing Act of 1946 (Act) 

(7 U.S.C. 1638 et seq.). 

Under preexisting Federal laws and 

regulations, origin designations for 

muscle cut covered commodities need 

not specify the production steps of 

birth, raising, and slaughter of the 

animals from which the cuts are 

derived. Thus, the Agency has not 

identified any Federal rules that would 

duplicate or overlap with this rule. 

We do not anticipate that additional 

recordkeeping will be required or that 

new systems will need to be developed 

to transfer information from one level of 

the production and marketing channel 

to the next. However, information 

available to consumers at retail will 

need to be augmented to include 

information on the location in which 

the three major production steps 

occurred. Therefore, the companies 

most likely to be affected are packers 

and processors that produce case-ready 

products, and retailers. 

There are two measures used by the 

Small Business Administration (SBA) to 

identify businesses as small: sales 

receipts or number of employees.4 In 

terms of sales, SBA classifies as small 

those grocery stores with less than $30 

million in annual sales (13 CFR 

121.201). Warehouse clubs and 

superstores with less than $30 million 

in annual sales are also defined as 

small. SBA defines as small those 

manufacturing firms with less than 500 

employees and wholesalers with less 

than 100 employees. 

While there are many potential retail 

outlets for the covered commodities, 

food stores, warehouse clubs, and 

superstores are the primary retail outlets 

for food consumed at home. In fact, food 

stores, warehouse clubs, and superstores 

account for 75.6 percent of all food 

consumed at home.5 Therefore, the 

number of these stores provides an 

indicator of the number of entities 

potentially affected by this rule. The 

2007 Economic Census 6 shows there 

were 4,335 supermarkets and grocery 

stores (not including convenience 

stores), warehouse clubs, and superstore 

firms operated for the entire year with 

annual sales exceeding $5,000,000 

(Table 1). We assume that stores with 

overall sales above this threshold would 

be most likely to be subject to the PACA 

and therefore subject to mandatory 

COOL and the proposed amendments. 

We recognize that there may be retail 

firms, particularly smaller retail firms, 

subject to PACA but that do not actually 

hold a PACA license. Therefore, a lower 

annual sales threshold may be 

appropriate for estimating the number of 

retailers subject to PACA. However, the 

$5,000,000 threshold provides estimated 

firm and establishment numbers that are 

generally consistent with the PACA 

database listing licensed retailers. 

The 2007 Economic Census data 

provide information on the number of 

food store firms by sales categories. Of 

the 4,335 food store, warehouse club, 

and superstore firms with annual sales 

of at least $5,000,000, an estimated 

4,106 firms had annual sales of less than 

$50,000,000, which is higher than the 

threshold for the SBA definition of a 

small firm. The Economic Census data 

do not provide a breakout at the 

$30,000,000 SBA threshold, which 

means that the estimated number of 

small businesses likely is an 

overestimate. 

We estimate that 33,350 

establishments owned by 7,181 firms 

will be either directly or indirectly 

affected by this rule (Table 1). Of these 

establishments/firms, we estimate that 

6,849 qualify as small businesses. The 

mid-point total direct incremental costs 

are estimated for the proposed rule at 

approximately $32.8 million. The direct 

incremental costs of the proposed rule 

are the result of revisions in labeling of 

muscle cut covered commodities. Of the 

total labeling costs of $32.8 million, $8.6 

million is estimated to be costs borne by 

small businesses. 

Small retailers’ portion of these costs 

is estimated at $5.9 million. Mid-point 

estimated costs are $982 per retail 

establishment. 

Any manufacturer that supplies 

retailers or wholesalers with a covered 

commodity will be required to provide 

revised country of origin information to 

retailers so that the information can be 

accurately supplied to consumers. Of 

the manufacturers potentially affected 

by the rule, SBA defines those having 

less than 500 employees as small. 

The 2007 Economic Census 7 provides 

information on manufacturers by 

employment size. For livestock 

processing and slaughtering there is a 

total of 2,808 firms (Table 1). Of these, 

2,707 firms have less than 500 

employees. This suggests that 96 

percent of livestock processing and 

slaughtering operations would be 

considered as small firms using the SBA 

definition. For chicken processing there 

are a total of 38 firms, only two of which 

are classified as small. Thus, only 5 

percent of the chicken processors are 

small businesses. 

Small packer and processor labeling 

costs under the proposed rule are 

estimated at $2.7 million. As with 

retailers, labeling costs are estimated at 

$982 per establishment. 

The Agency seeks comment on the 

accuracy of these estimates and the 

impacts on small businesses that may 

not be captured using the label cost 

model discussed above. 

Alternatives considered: Section 603 

of the RFA requires the Agency to 

describe the steps taken to minimize 

any significant economic impact on 

small entities including a discussion of 

alternatives considered. The law 

explicitly identifies those retailers 

required to provide their customers with 

country of origin information for 

covered commodities (namely, retailers 

subject to PACA). Thus, the proposed 

amendments are consistent with the 

requirements of the Act in terms of who 

is subject to the proposed rule. 

The proposed change in the definition 

of a retailer is not expected to have a 

substantial effect on the number of 

retailers subject to COOL requirements. 

The PACA program continually 

monitors the retail industry for firms 

that may meet the threshold for PACA 

licensing and seeks to enforce 

compliance with those requirements. 

Thus, those retailers that are required to 

hold a PACA license should, in fact, be 

licensed separate and apart from any 

COOL program requirements. 

The Agency considered other 

alternatives including taking no action 

or providing less information than is 

currently required under the COOL 

regulations. These alternatives would 

not achieve the purpose of this 

rulemaking. 

As with the current mandatory COOL 

program, the proposed rule has no 

requirements for firms to report to 

USDA. Compliance audits will be 

conducted at firms’ places of business. 

There are no recordkeeping 

requirements beyond those currently in 

place, and we believe that the 

information necessary to transmit 

production step information largely is 

already in place within the affected 

industries. As stated in the RFA of the 

COOL final rule, the current COOL 


pmangrum on DSK3VPTVN1PROD with PROPOSALS
15652 Federal Register / Vol. 78, No. 48 / Tuesday, March 12, 2013 / Proposed Rules 

requirements provide the maximum 

flexibility practicable to enable small 

entities to minimize the costs on their 

operations. This proposed rule in large 

measure retains these flexibilities. In 

addition, small packers, processors, and 

retailers are expected to produce and 

stock a smaller number of unique 

muscle cut covered commodities 

compared to large operations. Thus, 

labeling costs for small establishments 

likely will be lower than the estimated 

mid-point average of $982 for all 

establishments. 

Paperwork Reduction Act 

Pursuant to the Paperwork Reduction 

Act (PRA) (44 U.S.C 3501–3520) the 

information collection provisions 

contained in this rule were previously 

approved by OMB and assigned OMB 

Control Number 0581–0250. On 

December 4, 2012, AMS published a 

notice and request for comment seeking 

OMB approval to revise this information 

collection. The comment period closed 

on February 4, 2013. This proposed rule 

does not change these provisions. 

Executive Order 12988 

The contents of this rule were 

reviewed under Executive Order 12988, 

Civil Justice Reform. This rule is not 

intended to have a retroactive effect. 

States and local jurisdictions are 

preempted from creating or operating 

country of origin labeling programs for 

the commodities specified in the Act 

and these regulations. With regard to 

other Federal statutes, all labeling 

claims made in conjunction with this 

regulation must be consistent with other 

applicable Federal requirements. There 

are no administrative procedures that 

must be exhausted prior to any judicial 

challenge to the provisions of this rule. 

Civil Rights Review 

AMS considered the potential civil 

rights implications of this rule on 

minorities, women, or persons with 

disabilities to ensure that no person or 

group shall be discriminated against on 

the basis of race, color, national origin, 

gender, religion, age, disability, sexual 

orientation, marital or family status, 

political beliefs, parental status, or 

protected genetic information. This 

review included persons that are 

employees of the entities that are subject 

to these regulations. This proposed rule 

does not require affected entities to 

relocate or alter their operations in ways 

that could adversely affect such persons 

or groups. Further, this rule will not 

deny any persons or groups the benefits 

of the program or subject any persons or 

groups to discrimination. 

Executive Order 13132 

This rule has been reviewed under 

Executive Order 13132, Federalism. 

This Order directs agencies to construe, 

in regulations and otherwise, a Federal 

statute to preempt State law only where 

the statute contains an express 

preemption provision or there is some 

other clear evidence to conclude that 

the Congress intended preemption of 

State law, or where the exercise of State 

authority conflicts with the exercise of 

Federal authority under the Federal 

statute. This program is required by the 

2002 Farm Bill, as amended by the 2008 

Farm Bill. 

In the January 15, 2009, final rule, the 

Federalism analysis stated that to the 

extent that State country of origin 

labeling programs encompass 

commodities that are not governed by 

the COOL program, the States may 

continue to operate them. It also 

contained a preemption for those State 

country of origin labeling programs that 

encompass commodities that are 

governed by the COOL program. This 

proposed rule does not change the 

preemption. With regard to consultation 

with States, as directed by the Executive 

Order 13132, AMS previously consulted 

with the States that have country of 

origin labeling programs. AMS has 

cooperative agreements with all 50 

States to assist in the enforcement of the 

COOL program and has 

communications with the States on a 

regular basis. 

Because the United States wants to 

provide more specific information to the 

consumer at the earliest possible date, 

and consequently to bring COOL into 

compliance with the WTO ruling by 

May 23, 2013, the Agency has 

determined that a 30-day comment 

period is appropriate. 

For the reasons set forth in the 

preamble, 7 CFR part 60 is proposed to 

be amended as follows: 

PART 60—COUNTRY OF ORIGIN 

LABELING FOR FISH AND SHELLFISH 

■ 1. The authority citation for part 60 

continues to read as follows: 

Authority: 7 U.S.C. 1621 et seq. 

■ 2. Section 60.124 is revised to read as 

follows: 

§ 60.124 Retailer. 

Retailer means any person subject to 

be licensed as a retailer under the 

Perishable Agricultural Commodities 

Act of 1930 (7 U.S.C. 499a(b)). 

For the reasons set forth in the 

preamble, 7 CFR part 65 is proposed to 

be amended as follows: 

PART 65—COUNTRY OF ORIGIN 

LABELING OF BEEF, PORK, LAMB, 

CHICKEN, GOAT MEAT, PERISHABLE 

AGRICULTURAL COMMODITIES, 

MACADAMIA NUTS, PECANS, 

PEANUTS, AND GINSENG 

■ 1. The authority citation for part 65 

continues to read as follows: 

Authority: 7 U.S.C. 1621 et seq. 

■ 2. Section § 65.240 is revised to read 

as follows: 

§ 65.240 Retailer. 

Retailer means any person subject to 

be licensed as a retailer under the 

Perishable Agricultural Commodities 

Act of 1930 (7 U.S.C. 499a(b)). 

§ 65.300 [Amended] 

■ 3. Section 65.300 paragraphs (d), (e), 

and (f) are revised to read as follows: 

(d) Labeling Covered Commodities of 

United States Origin. 

A covered commodity may bear a 

declaration that identifies the United 

States as the sole country of origin at 

retail only if it meets the definition of 

United States country of origin as 

defined in § 65.260. The United States 

country of origin designation for muscle 

cut covered commodities shall include 

all of the production steps (i.e., ‘‘Born, 

Raised, and Slaughtered in the United 

States’’). 

(e) Labeling Muscle Cut Covered 

Commodities of Multiple Countries of 

Origin from Animals Slaughtered in the 

United States. 

If an animal was born and/or raised in 

Country X and/or (as applicable) 

Country Y, and slaughtered in the 

United States, the resulting muscle cut 

covered commodities shall be labeled to 

specifically identify the production 

steps occurring in each country (e.g., 

‘‘Born and Raised in Country X, 

Slaughtered in the United States’’). If an 

animal is raised in the United States as 

well as another country (or multiple 

countries), the raising occurring in the 

other country (or countries) may be 

omitted from the origin designation 

except if the animal was imported for 

immediate slaughter as defined in 

§ 65.180 or where by doing so the 

muscle cut covered commodity would 

be designated as having a United States 

country of origin (e.g., ‘‘Born in Country 

X, Raised and Slaughtered in the United 

States’’ in lieu of ‘‘Born and Raised in 

Country X, Raised in Country Y, Raised 

and Slaughtered in the United States’’). 

(f) Labeling Imported Covered 

Commodities. 

(1) Perishable agricultural 

commodities, peanuts, pecans, ginseng, 

macadamia nuts and ground meat 

covered commodities that have been 


pmangrum on DSK3VPTVN1PROD with PROPOSALS
Federal Register / Vol. 78, No. 48 / Tuesday, March 12, 2013 / Proposed Rules 15653 

produced in another country shall retain 

their origin, as declared to U.S. Customs 

and Border Protection at the time the 

product entered the United States, 

through retail sale. 

(2) Muscle cut covered commodities 

derived from an animal that was 

slaughtered in another country shall 

retain their origin, as declared to U.S. 

Customs and Border Protection at the 

time the product entered the United 

States, through retail sale (e.g., ‘‘Product 

of Country X’’), including muscle cut 

covered commodities derived from an 

animal that was born and/or raised in 

the United States and slaughtered in 

another country. In addition, the origin 

declaration may include more specific 

location information related to 

production steps (i.e., born, raised, and 

slaughtered) provided records to 

substantiate the claims are maintained 

and the claim is consistent with other 

applicable Federal legal requirements. 

Dated: March 7, 2013. 

Robert Epstein, 

Acting Administrator. 

[FR Doc. 2013–05576 Filed 3–11–13; 8:45 am] 

BILLING CODE 3410–02–P 

DEPARTMENT OF ENERGY 

10 CFR Part 429 

Notice of Intent To Form the 

Commercial HVAC, WH, and 

Refrigeration Certification Working 

Group and Solicit Nominations To 

Negotiate Commercial Certification 

Requirements for Commercial HVAC, 

WH, and Refrigeration Equipment 

AGENCY: Office of Energy Efficiency and 

Renewable Energy, U.S. Department of 

Energy. 

ACTION: Notice of intent. 

SUMMARY: The U.S. Department of 

Energy (DOE or the Department) is 

giving notice that the Appliance 

Standards and Rulemaking Federal 

Advisory Committee (ASRAC) intends 

to establish a working group in 

accordance with the Federal Advisory 

Committee Act (FACA) and the 

Negotiated Rulemaking Act (NRA) to 

negotiate certification requirements of 

commercial heating, ventilation, and 

air-conditioning (HVAC), water heating 

(WH), and refrigeration equipment. The 

purpose of the working group will be to 

discuss and, if possible, reach 

consensus on proposed certification 

requirements for commercial HVAC, 

WH, and refrigeration equipment, as 

authorized by the Energy Policy and 

Conservation Act of 1975, as amended. 

The working group members will be 

representatives of parties having a 

defined stake in the outcome of the 

proposed certification requirements, 

and will consult with a range of experts 

on technical issues. 

DATES: Nominations of membership 

must be received on or before March 26, 

2013. DOE will not consider any 

nominations received via mail or after 

midnight on March 26, 2013 to be valid. 

ADDRESSES: The nominee’s name, 

resume, biography, and any letters of 

support must be submitted in electronic 

format via email to asrac@ee.doe.gov. 

Any requests for further information 

should also be sent via email to 

asrac@ee.doe.gov. 

FOR FURTHER INFORMATION CONTACT: John 

Cymbalsky, ASRAC Designated Federal 

Officer, U.S. Department of Energy 

(DOE), Office of Energy Efficiency and 

Renewable Energy, 950 L’Enfant Plaza, 

SW., Washington, DC 20024. Email: 

asrac@ee.doe.gov. 

SUPPLEMENTARY INFORMATION: 

I. Authority 

II. Background 

III. Proposed Negotiating Procedures 

IV. Nominations Requested 

V. Approval of the Office of the Secretary 

I. Authority 

Title III of the Energy Policy and 

Conservation Act of 1975, as amended 

(‘‘EPCA’’ or ‘‘the Act’’) sets forth a 

variety of provisions designed to 

improve energy efficiency. Part A of 

Title III (42 U.S.C. 6291–6309) provides 

for the Energy Conservation Program for 

Consumer Products Other Than 

Automobiles. The National Energy 

Conservation Policy Act (NECPA), 

Public Law 95–619, amended EPCA to 

add Part A–1 of Title III, which 

established an energy conservation 

program for certain industrial 

equipment. (42 U.S.C. 6311–6317) 

Sections 6299–6305, and 6316 of EPCA 

authorize DOE to enforce compliance 

with the energy and water conservation 

standards (all non-product specific 

references herein referring to energy use 

and consumption include water use and 

consumption; all references to energy 

efficiency include water efficiency) 

established for certain consumer 

products and commercial equipment. 

(42 U.S.C. 6299–6305 (consumer 

products), 6316 (commercial 

equipment)) DOE has promulgated 

enforcement regulations that include 

specific certification and compliance 

requirements. See 10 CFR part 429; 10 

CFR part 431, subparts B, U, and V. 

This notice announces DOE’s and the 

ASRAC’s intent to negotiate certification 

requirements of commercial heating, 

ventilation, and air-conditioning 

(HVAC), water heating (WH), and 

refrigeration equipment under the 

authority of sections 563 and 564 of the 

NRA (5 U.S.C. 561–570, Pub. L. 104– 

320). 

II. Background 

On March 7, 2011, DOE published a 

final rule in the Federal Register that, 

among other things, modified the 

requirements regarding manufacturer 

submission of compliance statements 

and certification reports to DOE (March 

2011 Final Rule). 76 FR 12421. This 

rule, among other things, imposed new 

or revised reporting requirements for 

some types of covered products and 

equipment, including a requirement that 

manufacturers submit annual reports to 

the Department certifying compliance of 

their basic models with applicable 

standards. In issuing the rule, the 

Department emphasized that 

manufacturers could use their discretion 

in grouping individual models as a 

‘‘basic model’’ such that the certified 

rating for the basic model matched the 

represented rating for all included 

models. See 76 FR 12428–12429 for 

more information. 

In response to the initial deadline for 

certifying compliance imposed on 

commercial HVAC, WH, and 

refrigeration equipment manufacturers 

by the March 2011 Final Rule, certain 

manufacturers of particular types of 

commercial and industrial equipment 

stated that, for a variety of reasons, they 

would be unable to meet that deadline. 

DOE initially extended the deadline for 

certifications for commercial HVAC, 

WH, and refrigeration equipment in a 

final rule published June 30, 2011 (June 

30 Final Rule). 76 FR 38287 (June 30, 

2011). DOE subsequently extended the 

compliance date for certification an 

additional 12 months to December 31, 

2013, for these types of equipment 

(December 2012 final rule) to allow, 

among other things, the Department to 

explore the negotiated rulemaking 

process for this equipment. 77 FR 

72763. 

In the summer of 2012, DOE had an 

independent convenor evaluate the 

likelihood of success, analyzing the 

feasibility of developing certification 

requirements for commercial HVAC, 

WH, and refrigeration equipment (not 

including walk-in coolers and freezers) 

through consensus-based negotiations 

among affected parties. October 2012, 

the convenor issued his report based on 

a confidential interview process 

involving forty (40) parties. from a wide 

range of commercial HVAC, WH, and 

CRE interests. Ultimately, the convener 

recommended that with the proper 

scope of issues on the table surrounding 


pmangrum on DSK3VPTVN1PROD with PROPOSALS