31306 Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 999

[Docket No. FV94–999–2FR]

Specialty Crops; Import Regulations;

Peanut Import Regulations

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Final rule.

SUMMARY: This final rule establishes

minimum quality, identification,

certification and safeguard requirements

for imported farmers stock, shelled, and

cleaned-inshell peanuts. This rule is

issued under section 108B(f)(2) of the

Agricultural Act of 1949, as amended.

The provisions of paragraph (f)(2)

require all peanuts in the domestic

market to fully comply with all quality

standards under Peanut Marketing

Agreement No. 146 (Agreement).

Therefore, this rule establishes the same

quality requirements and handling

procedures for imported peanuts as

those which are in effect for

domestically produced peanuts. This

final rule addresses comments to the

proposed rule submitted by members of

the industry and other interested

persons. This action will benefit peanut

handlers, importers and consumers by

helping to ensure that all peanuts in the

marketplace comply with the same

quality standards.

EFFECTIVE DATE: July 19, 1996.

FOR FURTHER INFORMATION CONTACT: Tom

Tichenor or Rick Lower, Marketing

Specialists, Marketing Order

Administration Branch, Fruit and

Vegetable Division, AMS, USDA, P.O.

Box 96456, room 2523–S, Washington,

DC 20090–6456; tel: (202) 720–6862 or

(202) 720–2020 respectively; fax (202)

720–5698.

SUPPLEMENTARY INFORMATION: This final

rule is issued under paragraph (f)(2) of

section 108B of the Agricultural Act of

1949 (7 U.S.C. 1445c–3), as amended

November 28, 1990; Pub. Law 101–624,

hereinafter referred to as the Act.

Paragraph (f)(2) of section 108B of the

Act provides that the Secretary of

Agriculture (Secretary) shall require that

all peanuts in the domestic market fully

comply with all quality standards under

Marketing Agreement No. 146 (7 CFR

part 998), issued pursuant to the

Agricultural Marketing Agreement Act

of 1937, as amended (7 U.S.C. 601–674).

This rule adds ‘‘§ 999.600 governing

the importation of peanuts’’ under 7

CFR part 999—Specialty Crops; Import

Regulations. Section 999.600 establishes

minimum quality, identification,

certification and safeguard requirements

for foreign produced farmers stock,

shelled and cleaned-inshell peanuts

presented for importation into the

United States. The quality requirements

are the same as those specified in

§ 998.100 Incoming quality regulation

and § 998.200 Outgoing quality

regulation established pursuant to the

Agreement. Whenever the regulations

specified in the Agreement are changed,

the regulations in § 999.600 will be

changed accordingly. Safeguard

procedures enable the Department to

monitor and assure importers’

compliance with the requirements of

this regulation.

The intent of paragraph (f)(2) of

section 108B of the Act is to ensure that

all peanuts in the domestic marketplace

comply with the same quality standards.

The U.S. Department of Agriculture

(Department or USDA) is issuing this

rule in accordance with Executive Order

12866.

This rule has been reviewed under

Executive Order 12778, Civil Justice

Reform, and is not intended to have

retroactive effect. This rule will not

preempt any State or local laws,

regulations, or policies, unless they

present an irreconcilable conflict with

this rule. There are no administrative

procedures which must be exhausted

prior to any judicial challenge to the

provisions of this rule.

Pursuant to requirements set forth in

the Regulatory Flexibility Act (RFA), the

Agricultural Marketing Service (AMS)

has considered the economic impact of

this rule on small entities.

The purpose of the RFA is to fit

regulatory actions to the scale of

business subject to such actions in order

that small businesses will not be unduly

or disproportionately burdened. Small

agricultural service firms, which

include importers, have been defined by

the Small Business Administration (13

CFR 121.601) as those whose annual

receipts are less than $5 million. This

import regulation is based on

regulations established under the

Agreement which regulates the quality

of domestically produced peanuts.

Experience shows that peanut

importers affected by this regulation are

comprised primarily of signatories to

the Agreement and import brokers. The

majority of signatories to the Agreement

cannot be classified as small entities.

Import brokers may contract with

peanut handlers who have the

equipment and storage facilities needed

to carry out necessary shelling and

reconditioning of imported peanuts.

While the Department is aware of at

least seven importers who imported

peanuts into the United States (most of

whom are small entities), it is unable to

accurately estimate the number or size

of importers who may choose to import

peanuts in the future. The Department

estimates that there are as many as 50

domestic peanut handlers with storage

and milling facilities that can be used to

prepare peanuts for human

consumption markets.

The quality and handling

requirements of this import regulation

apply uniformly to all importers,

whether small or large. The peanut

import quota, while limited, is available

to all importers, regardless of size or

business orientation. There are no

known additional costs incurred by

small importers that are not incurred by

large importers.

No significant alternatives which

could accomplish the objectives of this

action were identified.

Importers must incur the costs of

inspection and aflatoxin analysis.

However, these costs are proportional to

the volume of peanuts imported and the

size of each inspected and tested lot.

Such costs are applied to all importers

regardless of size and also are consistent

with such costs incurred by handlers of

domestically produced peanuts.

Additional costs are incurred if an

imported lot must be reconditioned to

meet quality requirements of the import

rule. Losses may occur if an imported

failing lot cannot be reconditioned and

must be disposed to a non-edible peanut

outlet, destroyed or re-exported.

However, such costs are relative to the

quality of each imported peanut lot, and

importers may reduce the likelihood of

incurring reconditioning costs or other

losses due to poor quality peanuts, by

importing only high quality peanuts. In

this regard, the business risks for peanut

importers are no different than those for

handlers of domestically produced

peanuts. Further, it is common industry

practice that buyers (manufacturers) of

peanuts require, or make purchase

contingent upon, passing grade and

aflatoxin certificates of each peanut lot

purchased. Thus, the costs of inspection

and maintenance of lot identification

are a part of normal business practices

for this industry.

While the level of benefits of this

action are difficult to quantify, the

stabilizing effects of shipping only high

quality and wholesome peanuts to

human consumption outlets impact

both small and large importers

positively by helping them maintain

and expand markets. The Department is

not aware of any Federal rules which

duplicate, overlap, or conflict with this

final rule. Finally, this action is required

by statute.
Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations 31307

Based on available information, the

AMS has determined that this rule

would not have a significant impact on

a substantial number of small entities.

In the past, the importation of peanuts

has been limited to 1.71 million pounds

annually. However, the Schedule of the

United States annexed to the North

American Free Trade Agreement

(NAFTA), implemented on January 1,

1994, provided duty free entry for up to

approximately 7.43 million pounds of

qualifying peanuts from Mexico. For

1996, the duty-free access for Mexican

peanuts increased to approximately 7.88

million pounds. In calendar year 2008,

access for Mexican peanuts will be

unlimited. In addition, the United States

Schedule to the Uruguay Round

Agreements negotiated under the

General Agreement on Tariffs and Trade

(GATT) relaxes the peanut import quota

to 74.5 million pounds in 1995, with

additional annual increases of

approximately 10 million pounds to

reach a ceiling of 125 million pounds by

the year 2000 for all imported peanuts.

Various qualities of peanuts are

entered into the United States from

countries such as Argentina, Mexico,

Nicaragua, India, and the People’s

Republic of China. Foreign produced

peanuts are produced under varying

weather conditions and using different

cultural practices.

Consistent with the Agreement’s

regulatory provisions, each lot of

peanuts entered into the U.S. would be

required to be officially sampled and

graded by the Federal or Federal-State

Inspection Service (inspection service).

Incoming inspection for farmers stock

peanuts and outgoing inspection for

edible quality shelled peanuts and

cleaned-inshell peanuts will be required

for imported peanuts. A list of

inspection service offices is provided in

paragraph (d)(2)(i) of this regulation.

Some peanuts contain defects or other

damage which cause them to be of low

quality or have poor taste which could

affect the demand for peanuts.

Producers, handlers and manufacturers

in the domestic peanut industry believe

that even an isolated quality problem

could adversely affect consumer

confidence, which would be detrimental

to the domestic peanut industry.

The Agreement imposes quality

standards for domestically produced

inshell and shelled peanuts. Peanut lots

are graded based on the percentage of

unshelled peanuts, percentage of

kernels with damage and minor defects,

percentage of loose shelled kernels,

percentage of foreign material, and

percentage of moisture content. In

addition, an integral part of these

quality standards is the extent of the

presence of Aspergillus flavus mold (the

principal cause of aflatoxin, which is a

carcinogen). This mold is more likely to

be found on damaged or defective

kernels than on sound, whole, good

quality kernels. A chemical analysis for

aflatoxin is required on shelled peanut

lots not meeting superior quality

requirements. Shelled lots that exceed

certain superior quality requirements

need not be analyzed prior to shipment

for human consumption.

The proposed rule was issued January

23, 1996, and published in the Federal

Register February 1, 1996. A 30-day

comment period was provided and 16

comments were received. Comments

were received from a United States

Congressman, as well as persons

representing the agricultural office of a

South American embassy, the Peanut

Administrative Committee (PAC), the

American Farm Bureau Federation, the

Southwestern Peanut Growers’

Association, the Peanut Growers

Cooperative Marketing Association in

the Virginia-Carolina area, the American

Peanut Shellers Association, and the

American Peanut Product

Manufacturers, Inc. Comments were

also received from a peanut product

manufacturer, three peanut brokers, one

peanut handler/importer, and a

company making chemical analysis

testing kits. Most all commenters agree

that imported peanuts should meet

domestic requirements for human

consumption. However, they also were

critical of various provisions in the

proposed rule.

Three commenters stated that the

regulation should establish

requirements for aflatoxin testing of

peanut butter and peanut paste

imported from Canada and Mexico.

However, Peanut Marketing Agreement

No. 146, the authorizing statute, and the

quality regulations under the Agreement

are only applicable to peanuts and not

peanut products. The Food and Drug

Administration (FDA) is responsible for

certifying the aflatoxin level of imported

peanut butter and peanut products.

Four commenters recommended that

the rule should establish country-oforigin requirements on imported

peanuts to guard against peanuts

produced in one country and

transhipped through another country

before importation into the U.S.

However, the purpose of this rule is to

establish quality requirements for all

imported peanuts, and establishment of

country-of-origin requirements is not

necessary. The United States Customs

Service (Customs Service) monitors

country-of-origin on imported peanuts

for tariff purposes. In addition, the grade

and aflatoxin certificates will identify

the country-of-origin as the shipping

country unless another producing

country is identified on Customs

Service documentation.

Five commenters were of the opinion

that the regulation is contrary to the

spirit of GATT and NAFTA, which is to

promote free and fair trade. However,

both GATT and NAFTA recognize the

rights of signatories to protect

themselves from inferior quality imports

by allowing the receiving country to

apply to imports the same standards

mandated for its domestically produced,

agricultural products. The Department

believes that this rule meets such

‘‘national treatment’’ requirements in

that it provides the same grade and

handling requirements applied to

peanuts domestically produced

throughout the United States.

One commenter indicated that

European countries are implementing a

program using the quality test results

conducted by suppliers in originproducing countries. The commenter

questioned why the Department does

not honor origin-testing programs in

other countries while United States

peanut suppliers are aggressively

supporting origin-testing of peanuts

they ship to Europe. The commenter

recommended that imported peanuts be

origin-tested by recognized independent

laboratories overseas. The commenter

suggested that a laboratory owned and

operated by a PAC-approved laboratory

in the United States be authorized to

perform the grade and aflatoxin

inspections in Argentina. The lab is

currently certifying peanut shipments to

the United States and Europe, and those

shipments have met minimum aflatoxin

requirements over the past year.

The Agreement’s requirements, as

reflected in these import regulations, are

supported by an integrated quality

assurance system that includes

statistically based sampling, positive lot

identification, and laboratory oversight.

Because it would be difficult, at this

time, to ascertain that imported peanuts

meet the same quality requirements as

domestic peanuts without the

application of that inspection system,

these regulations do not provide for

country of origin inspection and testing.

A number of commenters complained

about the increased burden on

importers, and four commenters

contended that the regulation is more

burdensome on importers than the

domestic regulation is on handlers

under the Agreement. Individually or

jointly, they commented that the

proposed regulations would increase

importers’ burdens by: placing time

constraints on certification or nonedible disposition of each imported lot;
31308 Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations

requiring bonded storage which may be

scarce or not available; adding costs for

demurrage, sampling, and inspection of

imported lots; and adding layers of

bureaucracy and regulations. They

commented that any peanut lots

requiring more than simple aflatoxin

testing could not be shelled, sorted,

sized, remilled, and reported in 23 days.

As stated in the proposed rule, the

purpose of these regulations is to ensure

that all peanuts (including imported

peanuts) marketed in the United States

comply with quality standards of the

Agreement. Quality standards cannot be

guaranteed without handling

requirements that prohibit the

commingling of certain peanut lots and

ensure lot identification of imported

shipments. Further, in order to ensure

compliance with non-edible disposition

requirements, it is necessary to require

that imported peanut lots failing edible

quality be certified as handled and

disposed of to appropriate non-edible

peanut uses.

In this rule, the Department attempted

to establish the least burdensome and

least costly procedures which would

assure that imported peanuts meet the

required quality standards. Grade and

disposition requirements are the same

as those provided under the Agreement.

Lot identification and storage

requirements are similar to those of the

Agreement, but vary slightly because of

Customs Service requirements and

because shipments have to be monitored

from the place and time of conditional

release rather than from a buying point

or shelling facility.

The initial 30 day reporting period is

a Customs Service requirement that

cannot be changed by a USDA

regulation. It is applied by Customs

Service to imported merchandise that

must meet product requirements in

effect in the United States. Also, as

stated in the proposed rule, the

Department needs to establish a shorter

reporting period because a Customs

Service port-of-entry office issuing the

entry documentation needs up to 7 days

to issue a redelivery demand notice.

Therefore, the Department established a

reporting period of 23 days from the

date of entry by the Customs Service.

The intent of a Customs Service

redelivery notice is not necessarily to

require immediate return of the

shipment to the port-of-entry. Rather,

the redelivery notice serves as a notice

to the importer that the lot must be

either: (1) Brought into compliance with

program requirements within the

number of days specified on the

redelivery notice, or (2) returned to the

port-of-entry. During the redelivery

period, the importer may recondition a

failing lot in order to bring the lot into

compliance with regulatory

requirements. This option was not

clearly stated in the proposed rule.

The Department has been informed

that it may establish a redelivery period

which is longer than the 30 days

specified in the proposal. Therefore, to

enable importers more opportunity to

meet the requirements of this regulation,

the Department is extending the

redelivery demand period from 30 days

to 60 days. Customs Form 4647 (‘‘Notice

to Mark and/or Notice to Redeliver’’) is

issued by the Customs Service at the

request of AMS. A 60 day redelivery

period should be entered by the

Customs Service under item 15 on the

form. Thus, an importer has as long as

90 days to move an imported peanut lot

through the peanut handling process. By

the end of the redelivery period, the

importer must submit certifications to

AMS that the lot either: (1) Meets

requirements for human consumption;

(2) is disposed to one or more nonedible peanut outlets; (3) is destroyed

under supervision of the inspection

service and Customs Service; or (4) is

exported out of the U.S. Alternatively,

the importer must redeliver the peanuts

to the port-of-entry pursuant to the

redelivery notice.

An exception to this rule may be

applied to cleaned-inshell peanuts that

are conditionally released for movement

to an inland facility for outgoing

inspection. As stated in the proposed

rule, such cleaned-inshell peanut lots

must proceed directly to the outgoing

inspection and may not undergo any

cleaning, drying or sorting prior to

outgoing inspection. During outgoing

inspection, if AMS determines that the

peanut lot sampled and graded is a

farmers stock lot which has been

mislabeled or misrepresented as cleaned

in-shell peanuts, the lot is considered as

ungraded farmers stock peanuts and

must be sent to incoming inspection or

redelivered to the port-of-entry. Such

lots, if determined to be Segregation 1

quality at incoming inspection, can then

be cleaned, dried, sorted and otherwise

prepared for outgoing inspection as

cleaned-inshell peanuts.

The importer must notify both the

Customs Service and the AMS that an

outstanding lot has been certified as

meeting disposition requirements of

these regulations, destroyed or exported.

Failure to meet these requirements or

redeliver the peanut lot can result in

liquidated damages up to three times

the value of the product.

The Department also wishes to

reiterate that the above import

procedure is not the only procedure

available to importers. Importers can

avoid the 23-day reporting requirement

by holding shelled and cleaned-inshell

shipments under Customs Service

custody until the peanuts are sampled,

tested and certified as meeting

requirements for human consumption.

This should be possible with

containerization of the shipment that

allows for sampling by the inspection

service and storage while under

Customs Service custody.

The Customs Service requires (19 CFR

part 141.5) that lots so held must be

entered within 5 working days after

arrival at the port. Thus, it is important

that the peanut shipment be sampled

and the samples sent for outgoing

quality inspection and chemical

analysis as soon as possible after

unloading. Using overnight mail

services and fax transmissions, the

importer should be able to obtain grade

and aflatoxin content certificates within

2 or 3 days. If certified as meeting

import requirements for human

consumption, such peanuts do not have

to be reported to the Department and are

not subject to further handling

requirements of this regulation. As

stated in the proposed regulations,

shipments moved inland under Customs

Service custody and held in bonded

warehouses are not considered as

entered by the Customs Service. Thus,

the time under Customs Service custody

will not be counted against the 23-day

reporting period.

One commenter questioned how the

time frames relate to the stamp-and-fax

procedure and receipt of aflatoxin

analyses. For all imported shipments, it

is incumbent on the importer to plan

ahead by contacting the inspection

service offices where sampling and

grading will take place and the aflatoxin

lab where the analysis will be

conducted. The stamp and fax

procedure should take place before

arrival of the shipment. As noted above,

the 23-day reporting period begins when

the shipment is released from Customs

Service custody, whether at the port-ofentry or inland after movement and

storage under Customs Service custody.

Samples can be taken, inspections

performed, and results reported back to

the importer within 2 or 3 days. Extra

demurrage charges at a port-of-entry

would be less likely if the importer or

customs broker makes proper

preparations prior to the arrival of a

shipment.

The Customs Service suggested that

two definitions in paragraph (a) be

changed to be consistent with

terminology used by Customs. The

Department has revised definitions for

‘‘importation’’ and ‘‘conditionally

released’’ and has made conforming
Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations 31309

changes throughout this final rule to be

consistent with the new definitions. In

the proposed rule, the term

‘‘importation’’ was defined to mean

release from custody of the Customs

Service. That definition referred to

peanuts after arrival and release by the

Customs Service for inland movement.

To make the term consistent with

Customs Service operations, and for the

purposes of this peanut import

regulation, the term ‘‘importation’’

means the arrival of a peanut shipment

at a port-of-entry with the intent to enter

the peanuts into channels of commerce

of the United States.

‘‘Conditionally released’’ was defined

in the proposed rule to mean peanuts

released under bond for consumption or

withdrawal from warehouse for

consumption. This definition did not

describe the reason for release. For the

purposes of this import regulation,

‘‘conditional release’’ means released

from Customs Service custody for

further handling (sampling, inspection,

chemical analysis, or storage) before

liquidation (final release after

computation of applicable duties) by the

Customs Service of the imported peanut

lot.

After receiving information from a

Customs Service port-of-entry officer,

the Department has made an additional

relaxation that could reduce the filing

burden on importers. The proposed rule

stated that one Customs Service entry

document must be filed for each peanut

lot entered. However, one entry

document may encompass several lots.

Each lot must be separately identified

on the entry document to allow for

appropriate monitoring and clearance.

For example, a shipment of 500,000

pounds of shelled peanuts in 10

containers can be entered on one entry

document as 10 lots of one container per

lot; 5 lots of two containers per lot; 3

lots of 200,000 and 200,000 and 100,000

pounds per lot, or other variations.

Subdivision of a large shipment is a

decision for the importer, working

cooperatively with the Customs Service

and the inspection service at the portof- entry. Paragraph (g) has been

changed accordingly.

Two commenters pointed out that the

proposed rule did not provide for

changes in lot weight, especially after

remilling or cleaning of a failing lot. The

Department acknowledges potential

difficulty in accounting for the total

weight of a very large lot which may be

shelled and reconditioned several times.

However, the Department believes that

the accepted percentage for the weight

of shells in the shelling process plus the

combined weight of resultant sublots

and residuals should account for the

total weight of the original lot. The

Customs Service and the inspection

service both recognized that inshell

peanuts are 65 percent kernel weight

and 35 percent shell weight. Further,

the lot identification procedures of the

inspection service identify the weight of

the certified lot. Thus, when an

importer reports disposition of a lot that

has been reconditioned, the report must

include inspection and lot identification

certificates on all sublots—both edible

and non-edible residuals—resulting

from remilling or blanching.

One commenter offered three

recommendations that the Department

has included in this final rule. The

commenter correctly stated that, under

the Agreement, in addition to shelling,

failing cleaned-inshell lots may be

remilled by running the inshell peanuts

through inshell milling two or more

times to remove moldy, damaged,

moisture laden peanuts, and foreign

material that prompted the failing

certification. However, as noted above

regarding reconditioning of cleanedinshell peanuts, reconditioning may not

be conducted if the inspection service

determines that the failing peanuts are

farmers stock peanuts and not cleanedinshell peanuts. Such lots are

considered to be mislabeled and,

therefore, subject to redelivery without

reconditioning.

The commenter also pointed out that

destroying failing peanuts by burying

must be carried out under the

supervision of the inspection service.

Finally, he pointed out that under the

Agreement, Segregation 2 and 3 farmers

stock peanuts which are shelled before

exportation, must first also be

fragmented. This requirement is a

safeguard against such peanuts being

diverted to human consumption outlets.

Therefore these changes have been

made in the final rule.

A commenter pointed out two places

in the preamble of the proposed rule

where positive lot identification

provisions could be inserted to ensure

positive lot identification of failing

peanut lots. The commenter also

suggested that a definition for positive

lot identification be added to the final

rule. While the Department agrees with

the need to ensure lot identification on

all imported lots, it also understands the

great burden that ’positive’ lot

identification could place on

importers—particularly for large

shiploads of peanuts. Positive lot

identification involves an inspection

service seal or tag that clearly identifies

the peanuts covered by the seal or tag—

which is affixed in such a way that the

peanut container cannot be tampered

with without destroying the seal or tag.

Because of the size of some imported

shipments (up to 200,000 pounds), or

because of the multiple containers or

bags used for such lots, it would be

impractical to require that a seal be

placed or tag be sewed onto every

container or bag of such large shipments

at the port-of-entry. For this reason, a

definition of positive lot identification

was not included in the proposed rule.

This does not mean, however, that lot

identity is not as important under the

import regulation as it is under the

Agreement. Each imported lot must be

lot identified in such a way as to clearly

distinguish the peanuts in the lot, but

not necessarily require tags on

individual bags or plastic wrap around

an entire lot. Arrangements for lot

identification should be made with the

inspection service and Customs Service

officers at the port-of-entry. Such

arrangements can be tailored for the

particular circumstances of each

imported lot. Lot identification

requirements of this rule should provide

no less assurance of positive lot identity

than is provided under the Agreement

for domestically produced peanuts.

The commenter’s suggestion that

positive lot identification be placed on

failing lots is accepted by the

Department. This final rule makes the

identification procedures for failing

residual peanuts more precise by

establishing that residual peanuts

resulting from the reconditioning,

remilling or blanching of a failing

imported lot must be positive lot

identified. At this point in the handling

process, residual peanuts from a milling

process are capable of being handled the

same as domestically produced

peanuts—and therefore, should be

subject to the same positive lot identity

labeling requirements (such as sewing

tags on bags or stamping individual

containers of failing peanuts) that are

required for domestically produced

failing peanuts. Clarifying sentences are

added to paragraphs (c)(3) and (g)(2)

requiring positive lot identification of

residual lots.

Several commenters addressed the

proposed provision which states that

superior quality shelled peanuts do not

have to be tested for aflatoxin prior to

shipment for human consumption. Two

addressed the dangers of aflatoxin

contamination in food products and

recommended that aflatoxin testing be

required on all peanut lots imported

into the United States.

Under the Agreement, all

domestically produced, shelled peanuts

intended for human consumption use

must meet specified minimum quality

requirements found in the Agreement’s

‘‘Other Edible Quality’’ table and must
31310 Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations

undergo chemical analysis for aflatoxin

content prior to shipment for human

consumption. Other edible quality grade

is referred to as minimum grade in this

import regulation. Further, the

Agreement provides that peanuts which

meet the higher quality requirements

found in the ‘‘Indemnifiable Grades’’

table do not need to undergo such

chemical analysis. Indemnifiable grade

is referred to as superior grade in this

import regulation.

One commenter referred to paragraph

(l)(3) of section 998.300 ‘‘Terms and

Conditions for Indemnification’’ as a

requirement for aflatoxin analysis.

However, this section of the Agreement

refers to indemnified lots and has no

relevance to imported peanuts as those

peanuts cannot be indemnified under

the Agreement.

One commenter, while recognizing

that the superior grade peanuts do not

have to be tested for aflatoxin, suggested

that uncontrolled temperature,

humidity, and moisture could degrade

the condition of a peanut lot during

shipment. Therefore, the commenter

recommended that all imported

peanuts, even those that meet ‘‘Superior

Quality Requirements’’ upon arrival in

the U.S., should be chemically tested for

aflatoxin content. Imported peanut lots

which are not properly packaged or

handled during shipment and are

degraded or otherwise damaged as a

result, would most likely fail ‘‘Superior

Quality Requirements’’ and would be

subject to aflatoxin analysis. Therefore,

the recommendation is denied.

One commenter asked whether the

regulations in the proposed rule

represented an overlap of responsibility

between the Department and FDA with

regards to the methodology used for

sampling and testing peanut shipments

and the enforcement of test results. As

stated in the proposed rule, this rule

does not supersede laws or

requirements of other Federal

government agencies. Thus, this rule

does not prevent FDA from inspecting

imported peanut shipments, should it

choose to do so. The Department has

initiated a Memorandum of

Understanding with FDA to minimize

possible duplication of inspections.

Three commenters recommended that

the implementation of the regulation be

delayed. Two suggested that because

some members of the Agreement wish to

amend the regulations regarding the

handling of farmers stock peanuts, it

would be better to delay

implementation of the import regulation

until such a change, if approved by the

Secretary, is implemented. They

commented that such delay would

avoid confusion regarding applicable

import requirements. One commenter

complained that some peanut shipments

are already in transit to the United

States and should not be held to

requirements established after departure

of the shipment. Because of concerns

such as these, the Department has

decided to make this rule effective 30

days after the date of publication in the

Federal Register. Since the rule was

first proposed on February 1, 1996,

importers should have ample time to

prepare for its implementation.

As noted in the proposed rule,

whenever the quality requirements and

handling procedures are changed in the

Agreement, the same or equivalent

changes will be made in the quality

requirements and handling procedures

of this import regulation.

In preparing for implementation of

this regulation, the inspection service

has issued instructions to its field

offices which will receive and collect

the samples of imported peanut

shipments. To reduce the possibility of

split kernels caused in the sampling

process, special instructions have been

issued for collecting the samples from

bags. While no comments were received

regarding this issue, the Department

wants the industry to be aware that

precautions have been taken to avoid

causing defects in lots during the

handling. The same procedures are

followed when sampling domestically

produced peanuts presented in bags.

Several minor corrections and

clarifications also are made to correct

references to paragraphs in the

regulatory text and clarify procedures

presented in the proposed rule. The

changes are based on comments

received and on the Department’s

review of the published proposed rule.

Customs Service Entry Requirements

and USDA Safeguard Procedures

Importer obligations include filing

documents notifying the Customs

Service and the Department of different

actions taken concerning foreign

produced inshell and shelled peanuts.

Customs Service importation

procedures and requirements are set out

in title 19 of the Code of Federal

Regulations (19 CFR). The Customs

Service regulations applicable to peanut

handling and processing include, but

are not limited to: bond requirements

(19 CFR part 113); transfer from port-ofentry to another Customs Service office

location (19 CFR part 112); entry of

merchandise for consumption (19 CFR

part 141); warehouse entry, and

withdrawal from warehouse for

consumption (19 CFR part 144);

establishment of bonded warehouses (19

CFR parts 19.13 and 19.2); and

manipulation in bonded warehouses (19

CFR part 19.11); transfer of ownership

(19 CFR parts 141.113 and 141.20);

failure to recondition (19 CFR part

113.62(e); and redelivery of

merchandise 19 CFR part 113.62(d). For

purposes of this regulation, the term

‘‘consumption’’ means ‘‘use in the

United States.’’ Customs Service entry

procedures are not superseded by this

import regulation.

Foreign produced peanuts may be

entered for ‘‘warehouse’’ or entered for

‘‘consumption,’’ or may be transported

to another Customs Service port-of-entry

to be entered there for warehouse or

consumption. Peanuts transported from

one Customs Service port-of-entry to

another Customs Service port-of-entry

must be transported by a carrier

designated by the Customs Service

under 19 U.S.C. 1551. Peanuts entered

for warehouse are stored in a Customs

Service bonded warehouse. Such

peanuts remain in Customs Service

custody until they are withdrawn from

warehouse, or entered, for

consumption—and are released from

Customs Service custody. Peanuts

entered for consumption, or withdrawn

from warehouse for consumption, are

released conditionally, pending

certification that the peanuts meet the

handling and quality requirements of

this regulation and conform to Customs

Service entry requirements. The

Customs Service can demand redelivery

of peanuts that fail these requirements.

The importer, or import broker acting

on behalf of the importer, is required to

file with the Customs Service required

entry documentation for each foreign

produced peanut shipment to be

entered. More than one lot can be filed

on one entry document. Under

safeguard procedures established in this

rule, each importer is also required to

file completed entry documentation

(Customs Form 3461 or other equivalent

form) with the inspection service office

that will perform the sampling of the lot

for inspection to provide that office with

advanced notice of requested

inspection. The entry documentation

may be filed by mail or facsimile

transmission (fax). The filing should

occur prior to arrival of the shipment at

the port-of-entry in order to expedite

entry procedures. The inspection

service office will stamp, sign, and date

the entry document and return it to the

importer or broker by fax or mail. The

importer/broker will then submit the

stamped copy to the Customs Service.

This ‘‘stamp-and-fax’’ procedure is

similar to a procedure in place for other

imported agricultural commodities

under AMS jurisdiction. Failure to show

the Customs Service a copy of the entry
Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations 31311

documentation stamped by the

inspection service will result in a delay

or denial of entry of a peanut lot. The

importer/broker must also mail or fax a

completed copy of the document to

AMS to initiate the Department’s

monitoring process.

The location and telephone numbers

of inspection service offices that

perform peanut sampling and/or grade

inspections are provided in paragraph

(d)(3) of this rule. Inspection service

offices at other locations may be

contacted to sample the imported

peanut lot. In such cases, the collected

peanut samples will be shipped to an

inspection service office which has

equipment and personnel qualified to

perform grade inspections. Samples of

lots meeting minimum grade

requirements will also be sent to an

approved laboratory (listed in paragraph

(d)(4)) for aflatoxin analysis. The lot will

have to remain in storage pending grade

and aflatoxin certification.

It is the importer’s responsibility to

provide, in the mailed or faxed

documentation, sufficient information

to identify the peanut lot being entered

and to ensure that arrangements are

made for sampling and inspection. The

information will include the container

identification, weight of the peanut lot,

the city, street address, and building

number (if known) receiving the peanut

lot, the requested date and time of

inspection, and a contact name or

number at the destination. If the

destination is changed from that listed

on the stamp-and-fax document, it is the

importer’s responsibility to immediately

advise inspection service offices at both

the original destination and the new

destination of such change. Shipments

which are not made available pursuant

to the entry document, or are not

properly displayed for sampling

purposes, will be reported to the

Customs Service.

Falsification of reports submitted to

AMS is a violation of Federal law

punishable by fine or imprisonment, or

both.

A bond secured by surety or U.S.

Treasury obligations is required to be

posted by the importer with the

Customs Service to guarantee the

importer’s performance. Peanuts can be

determined inadmissible because the

importer failed to follow Customs

Service importation procedures, the

peanuts failed to meet quality

requirements, or because the handling

procedures (including lot identification

and certification) specified in this

regulation were not followed.

Redelivery will be demanded for

failure to comply with the quality,

handling, and reporting requirements of

this import regulation, including: arrival

at the inland destination with a broken

Customs Service or inspection service

seal; failure to maintain lot identity;

mislabeling of the peanuts being

imported; failure to receive required

inspection; commingling of peanut lots

not of like quality or condition;

disposition of non-edible peanuts to an

edible peanut outlet or an improper,

non-edible peanut outlet; and failure to

fully report the disposition of foreign

produced peanuts. Disposition reports

will include grade, aflatoxin, and

identification certifications and bills of

lading, sales receipts, and other

documentation showing the peanuts

were disposed to a non-edible peanut

outlet, exported, or destroyed.

Following Customs Service

regulations, a redelivery demand must

be issued by the Customs Service within

30 days of Customs Service entry of the

peanuts—if the peanuts are not certified

as meeting requirements of this import

regulation. Because the Customs Service

requires one week to prepare and issue

a redelivery demand notice, this import

rule establishes that importers must

report disposition of lots of peanuts to

AMS within 23 calendar days of the

date of entry. Although a 23-day

reporting deadline may be considered

burdensome by some, the deadline is

necessary because of the Customs

Service 30-day notification requirement.

If an importer has difficulty meeting

edible consumption certification or

completing necessary shelling,

remilling, or other reconditioning by the

23rd day after entry, the importer

should notify AMS of such difficulty. If

the importer fails to so notify AMS, or

fails to report necessary certification,

AMS will request the Customs Service

to issue a redelivery demand for the outof-compliance lot.

As covered above, after receiving a

notice of redelivery, the importer may

continue to try to recondition the failing

lot or redeliver the failing lot to the portof-entry. The redelivery notice, in effect,

provides an additional 60 days, from the

date of issuance, for the importer to

comply with requirements of this

import regulation. The exception to this

is for peanuts labeled as cleaned-inshell

which are determined by the inspection

service to be unprepared farmers stock

peanuts. Such peanuts must be

redelivered immediately and may not be

reconditioned.

If the importer is unable to meet these

import requirements by the end of the

60-day redelivery period, the importer

may request an extension of the period

from the Customs Service. The Customs

Service may authorize an appropriate

extension for good cause. The importer

is responsible for reporting any such

extension to AMS.

When moving a conditionally

released lot inland, the importer will

cause a copy of the entry documentation

applicable to the peanut lot to be

forwarded with the peanuts to the lot’s

inland destination. If the shipment is

sealed by Customs Service or the

inspection service, the seal must remain

intact and can be broken only by an

authorized official at the destination

point.

The identification requirements in

this regulation are similar to the

Agreement’s lot identification

requirements. Lot size is limited to

200,000 pounds to comply with

Agreement requirements and sampling

provisions of the inspection service.

Boatload shipments exceeding 200,000

pounds must be entered as two or more

lots, but may be entered under one

Customs Service entry document. For

instance, five containers averaging

40,000 pounds each (the domestic

industry standard) may be entered as

five lots on one entry document. Lot

size and identification arrangements

must be made consistent with the portof-entry inspection service office

requirements and should be established

cooperatively between the inspection

service, Customs Service offices and the

importer at the port-of entry. This will

facilitate subsequent lot identification,

inspection, and reporting of large

imported shipments.

Foreign produced peanuts placed in

storage may be commingled only with

like-quality, foreign produced peanuts

belonging to the same importer.

Similarly, failing quality peanuts may

be commingled with other such foreign

produced peanuts prior to clean-up or

non-edible disposition. Reports

certifying disposition of all peanuts in

the commingled lot must be filed within

23 days of Customs Service entry of the

earliest-entered lot commingled, or, if a

redelivery notice is issued on the

earliest entered lot, within the 60-day

redelivery period for that lot. The

remaining commingled peanuts must be

withdrawn, inspected, properly

disposed, and reported before the end of

that 60-day redelivery period. If

necessary, the importer may request that

Customs Service extend the redelivery

period for the remaining peanuts in the

commingled lot.

The objective of the lot identification

requirements is to help ensure that

individual peanut lots are disposed as

required and that defects in poor quality

peanut lots are not blended out by

commingling poor quality peanuts with

higher quality peanuts. The lot

identification requirements in this
31312 Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations

import regulation are similar to positive

lot identification requirements specified

for domestically produced peanuts.

Positive lot identification involves a

Federal or Federal-State Inspection

Service seal or tag that clearly identifies

the peanuts covered by the seal or tag,

and which is affixed in such a way that

the peanut lot cannot be tampered with,

without destroying the seal or tag.

Because of the size of some imported

shipments (up to 200,000 pounds) it

would be impractical to have a seal or

tag sewed onto every bag or container in

such a lot. Thus, an imported lot may

be lot identified in such a way as to

clearly distinguish the peanuts in the

lot, but not require tags on individual

bags or plastic wrap around the entire

lot. However, residual sublots resulting

from the reconditioning, remilling or

blanching of a failing lot must be

positive lot identified, consistent with

the provisions of lot identification

provisions of the Agreement.

All USDA required sampling, quality

certification, and lot identification must

be conducted by the inspection service.

Chemical analysis must be conducted

by a USDA or an approved laboratory.

Foreign produced peanuts stored in

bonded warehouses are subject to

Customs Service audits. Importers will

reimburse the inspection service,

laboratories, and the Customs Service

for services provided and costs incurred

with regard to the entry of the

importer’s peanuts.

Depending on condition (shelled or

cleaned-inshell) and containerization,

foreign produced peanuts may be either:

(1) Sampled, inspected, and held in a

Customs Service bonded warehouse at

the port-of-entry until certified by the

inspection service as meeting the edible

quality requirements of this rule; or, (2)

conditionally released at the port-ofentry and entered under Customs

Service entry procedures for later

inspection and certification.

Under option (1), foreign produced

shelled or cleaned-inshell peanuts

which are cleaned, sorted, sized, and

otherwise prepared for edible

consumption prior to importation, are

sampled at the port-of-entry. The

importer must present such peanuts in

containers or bags that allow

appropriate sampling of the lot pursuant

to inspection service requirements.

After sampling, such lots are held at the

port-of-entry, under lot identification

requirements of the inspection service,

pending results of the inspection and

chemical analysis. Depending on

location of the port-of-entry, portions of

the samples are sent to an inspection

service inspection facility for grade

inspection and to an aflatoxin laboratory

for chemical analysis. If determined to

meet the applicable edible quality

requirements in paragraph (c) of this

rule, the shelled or cleaned-inshell

peanuts may be entered for

consumption without further

inspection. Reports of such entries do

not have to be filed with AMS because

the lots cleared all requirements while

under Customs Service custody.

Such shelled or cleaned-inshell

peanuts, sampled and held at the portof-entry, which fail edible quality

requirements may, at the importer’s

discretion, be: (1) re exported; (2)

entered for reconditioning, and if

satisfactorily remilled or blanched,

certified for edible consumption; or (3)

entered for non-edible consumption.

Failing peanuts that are re-exported do

not have be reported to AMS because

the peanuts were not entered into the

U.S. The importer must file

certifications which report all actions

taken on each lot entered for

reconditioning or non-edible

consumption. Such certifications must

be reported within 23 days of entry, or,

if a redelivery notice is issued, within

the 60-day redelivery period.

Under option (2), shelled and

cleaned-inshell peanuts which are

cleaned, sorted, sized, and otherwise

prepared for edible consumption prior

to importation, may be entered and

transported inland for subsequent

sampling, inspection, and certification.

Farmers stock peanuts also must be

shipped inland for sampling and

inspection because specialized, farmers

stock sampling facilities are not

available at ports-of-entry. Certifications

reporting disposition of these lots must

be filed within 23 days of entry, or, if

a redelivery notice is issued on the lot,

within the 60-day redelivery period.

Categories of Peanuts Submitted for

Importation

Farmers Stock Peanuts

Such peanuts are required to undergo

incoming inspection at a prearranged

buying point prior to arrival at a

shelling or storage destination. All

required inspections, shelling, and

dispositions of farmers stock peanuts

must be completed and reported within

23 days of entry, or, if a redelivery

notice is issued on the lot, within the

60-day redelivery period.

Foreign produced farmers stock

peanut lots cannot be commingled with

other peanut lots prior to incoming

inspection. Incoming inspection

determines the quality of the farmers

stock peanuts based on moisture

content, foreign material, damage, loose

shelled kernels, and visible Aspergillus

flavus mold. The inspection service will

issue USDA form CFSA–1007,

‘‘Inspection Certificate and Sales

Memorandum’’ (formerly ASCS–1007)

designating the lot as either Segregation

1, 2, or 3 quality.

Only Segregation 1 peanuts can be

prepared for human consumption use.

Such peanuts may be shelled or

prepared for cleaned-inshell use. For

quality control and reporting purposes,

Segregation 1 lots intended for human

consumption outlets may be

commingled only with other like quality

peanuts of the same importer. A

Segregation 1 lot which is commingled

with Segregation 2 or 3 peanuts must

assume the lower Segregation 2 or 3

quality and must be disposed as nonedible quality peanuts.

Foreign produced farmer stock

peanuts received by importers and

determined at incoming inspection to be

Segregation 2 and 3 quality peanuts

must be disposed only as non-edible

peanuts. Segregation 3 and commingled

Segregation 2 and 3 farmers stock

peanuts may be exported inshell or

exported shelled if fragmented prior to

export. Segregation 2 and 3 peanuts also

may be destroyed by burying (under

inspection service and Customs Service

supervision) or exported (certified by

Customs Service). The importer must

report non-edible disposition by

providing a copy of the incoming

inspection certificate, bills of lading and

sales receipts, or other official

certifications as proof of disposition to

crushing, exportation, other non-edible

outlets, or burying. Segregation 2 and 3

peanuts that are exported must be lot

identified by the inspection service and

certified as exported by the Customs

Service. Certification of non-edible

disposition or export must be filed with

AMS within 23 days of entry, or, if a

redelivery notice is issued, within the

60-day redelivery period. Customs

Service re-export procedures must be

followed.

Foreign produced Segregation 2 and 3

quality peanuts may be shelled by a

custom seed sheller for seed use and, if

so disposed, such peanuts must be dyed

or chemically treated so as to be unfit

for human or animal consumption.

Domestically produced Segregation 2

and 3 peanuts shelled for seed need not

be dyed or treated but must be produced

under the auspices of a State agency,

shelled by a custom seed sheller, and

subject to PAC oversight. Measures such

as these are necessary to ensure that

peanuts used for human consumption

are safe and wholesome. Proof of dyeing

or chemical treatment of foreign

produced peanuts must be filed with

AMS within 23 days of entry, or, if a
Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations 31313

redelivery notice is issued on the lot,

within the 60-day redelivery period.

Foreign produced farmers stock

peanuts do not qualify for the support

program administered by the

Department’s Farm Service Agency,

formerly the Agricultural Stabilization

and Conservation Service.

Shelled peanuts: Foreign produced

shelled peanuts may: (1) Originate from

foreign produced Segregation 1 farmers

stock milled at facilities in the U.S., or

(2) be peanuts produced and milled in

another country which are conditionally

released at the port-of-entry for inland

sampling and inspection. Both

categories of shelled peanuts must be

sampled and inspected against outgoing

quality requirements specified in

paragraph (c) of this regulation.

Domestically produced shelled

peanuts intended for edible markets

must originate from farmers stock

peanuts which have undergone

incoming inspection and are determined

to be of Segregation 1 quality. AMS

cannot determine whether peanuts

produced and shelled in a foreign

country originated from Segregation 1

quality peanuts prior to shelling.

However, because outgoing inspection

and chemical analysis is more reliable

and precise in determining aflatoxin

content in peanut kernels, this import

regulation provides that peanuts shelled

prior to importation are exempt from

incoming inspection before delivery for

outgoing inspection. Such shelled

peanuts must be sampled and tested

against outgoing quality requirements

prior to disposition to edible outlets.

Two grade levels for shelled peanuts

are in effect under the Agreement and

are established in this import regulation.

The Agreement provides that shelled

peanut lots meeting the quality

requirements specified in a table

entitled ‘‘Other Edible Quality,’’ under

paragraph (a) of § 998.200, must be

chemically analyzed for aflatoxin

content prior to disposition to edible

outlets. The quality requirements

specified in the Other Edible Quality

table are duplicated in ‘‘Table 1,

Minimum Grade Requirements—

Peanuts for Human Consumption’’ of

this import regulation. The outgoing

quality requirements also include a

parts-per-billion tolerance for aflatoxin,

determined by chemical analysis.

The Department has corrected an

entry in Table 1. Minimum Grade

Requirements’’ as published in the

proposed rule. Under the ‘‘Lots of

splits’’ category, the cite for Virginia

peanuts should read ‘‘Virginia (not less

than 90% splits).’’ The proposed rule

incorrectly stated not more than 90%.

Aflatoxin appears most frequently in

damaged, stressed, under-developed

and malformed kernels. Domestic lots

with fewer poor quality kernels are less

likely to be contaminated and, thus, do

not have to be chemically tested. The

Agreement’s ‘‘Indemnifiable Grades’’

table in paragraph (a) of § 998.200,

provides for a superior quality level

with more rigorous percentage

tolerances than those found in the Other

Edible Quality table. Foreign produced

shelled lots meeting the superior quality

standards do not have to be chemically

analyzed prior to their disposition for

human consumption. The quality

requirements specified in the

‘‘Indemnifiable Grades’’ table are

duplicated in ‘‘Table 2 Superior Quality

Requirements—Peanuts for Human

Consumption’’ of this rule.

Paragraph (c)(4) of § 998.200 provides

that peanuts are considered edible

quality if the chemical assay shows the

lot contains 15 ppb or less of aflatoxin.

Thus, the level of aflatoxin in foreign

produced peanut lots intended for

edible peanut markets must not exceed

15 ppb. Consistent with paragraphs

(c)(4) and (g)(3) of § 998.200, non-edible

quality peanut lots with 25 ppb or less

must be disposed to certain non-edible

peanut outlets. Disposition of nonedible quality peanut lots with aflatoxin

exceeding 25 ppb must be further

restricted to certain other non-edible

peanut outlets. The sampling, testing,

certification and identification of

foreign produced peanut lots must be

performed in accordance with

paragraph (d)(4) of this rule.

Chemical testing is performed by an

AMS, Science and Technology Division

laboratory or a laboratory approved by

the PAC. The PAC locally administers

the Agreement with Department

oversight. A list of approved

laboratories is provided in paragraph

(d)(4)(iv) of this regulation. These are

the same laboratories specified in the

Agreement and any changes to the list

will be incorporated in this section.

Thus, to obtain approval for human

consumption use of a foreign produced

shelled peanut lot, the importer must

present to AMS and the Customs

Service two certifications: (1) Quality

certification Form FV–184–9A ‘‘Milled

Peanut Inspection Certificate’’ and (2)

aflatoxin certification Form CSSD–3

‘‘Certificate of Analysis for Official

Samples’’ issued by USDA laboratories,

or equivalent forms issued by a PAC

approved lab. An aflatoxin certificate is

not required if the lot meets the superior

grade requirements, but may be required

by the buyer. The certificates are the

same as those used to report grade and

chemical analysis results for

domestically produced peanuts. The

required certificates must be received by

AMS within 23 days of entry, or, if a

redelivery notice is issued, within 60

days of the redelivery notice.

Cleaned-Inshell Peanuts

Inshell peanuts that have been

cleaned, sorted, and prepared in another

country for edible inshell peanut

markets in the U.S. may be presented for

importation at the port-of-entry. Such

peanuts can be declared as cleanedinshell peanuts on the Customs Service

entry document and can either be

presented for outgoing inspection at the

port-of-entry, if delivered in bags and

presented is such a way as to be

accessible for sampling by the

inspection service, or conditionally

released for outgoing inspection at a

facility inside the U.S. Because the

Department is unable to determine if

foreign produced cleaned-inshell

peanuts come from Segregation 1

peanuts, peanuts declared as cleanedinshell on a Customs Service entry

document must not undergo additional

cleaning, sorting, sizing, or drying prior

to outgoing inspection at the destination

point inside the U.S.

Cleaned-inshell lots that fail outgoing

inspection for inshell peanuts may be

reconditioned (remilled) and

subsequently sampled and graded for

outgoing inspection. If there is any

indication that an imported farmers

stock lot is mislabeled or

misrepresented as cleaned-inshell

peanuts when entered, redelivery of the

lot will be required and the lot may not

be reconditioned prior to redelivery to

the port-of-entry.

Cleaned-inshell peanut lots destined

for edible peanut markets are required

to meet certain minimum quality inshell

requirements for damage, moisture and

foreign material. Cleaned-inshell lots

containing more than 1 percent kernels

with visible mold have to be chemically

tested and meet minimum aflatoxin

requirements. The cleaned-inshell

quality requirements specified in

paragraph (c)(2) of this rule are the same

as the quality requirements in paragraph

(b) of § 998.200 of the Agreement.

Foreign produced farmers’ stock

Segregation 1 peanuts also can be

prepared and presented at outgoing

inspection as cleaned-inshell peanuts.

Such peanuts inspected and certified as

meeting grade requirements for edible

cleaned-inshell peanuts must be

designated as imported peanuts on

inspection service form FV–184–9A.

The importer must file form FV–184–9A

with AMS for each lot of foreign

produced cleaned-inshell peanuts
31314 Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations

meeting edible quality requirements for

cleaned-inshell peanuts.

Imported peanuts certified as meeting

edible requirements can be used any

way desired. Only after shelled and

cleaned-inshell peanuts are certified as

meeting applicable requirements can

such peanuts be commingled with

imported lots of other importers or

domestically produced peanuts which

also have been certified for human

consumption.

Disposition of Failing Peanuts

The following peanuts cannot be used

for human consumption: (1) Farmers’

stock peanuts that grade either

Segregation 2 or Segregation 3; (2)

cleaned-inshell and shelled peanuts that

fail outgoing quality and/or aflatoxin

requirements and are not reconditioned

or reworked (the removal of defective

kernels); and (3) below grade residue

from any shelling, milling or blanching

operations.

Cleaned-inshell lots that fail outgoing

inspection requirements of paragraph

(c)(2) can be reconditioned by remilling

the peanuts, which can include shelling.

If shelled or remilled, the peanuts must

meet outgoing requirements of

paragraph (c)(1) for shelled peanuts or

(c)(2) for inshell peanuts.

Failing lots of shelled peanuts, which

originated from Segregation 1 peanuts,

can be reconditioned following

procedures established in paragraph (f)

of this rule. These provisions are the

same as those established under various

provisions of the Agreement.

Segregation 1 shelled peanuts which fail

quality requirements in Table 1 and/or

exceed 15 ppb aflatoxin content can be

reconditioned by remilling and/or

blanching and, when subsequently

reinspected and certified as meeting

edible quality and aflatoxin

requirements, can be disposed to edible

peanut outlets. If not reconditioned,

failing Segregation 1 lots must be

disposed to non-edible peanut outlets as

unrestricted or restricted peanuts as

described below.

Provisions controlling the disposition

of residue peanuts from inshell

remilling and shelled remilling and

blanching that continue to fail edible

quality requirements are also provided

in this rule. Two categories of nonedible peanuts are specified under the

Agreement—‘‘unrestricted’’ and

‘‘restricted.’’ The designation is based

on the amount of aflatoxin detected in

the lot. ‘‘Unrestricted’’ peanuts are

peanuts which fail one or more quality

requirements and, when chemically

assayed, contain more than 15 ppb but

25 ppb or less aflatoxin. While such

peanuts are of non-edible quality, they

can be crushed for oil, exported or used

in animal feed, provided that certain

handling and container labeling

requirements are followed. Unrestricted

peanuts also can be used for seed (if

dyed or treated to prevent edible use),

crushed for oil, exported, or buried.

Meal resulting from the crushing of

unrestricted peanuts does not have to be

tested a second time for aflatoxin

content. Disposition of meal resulting

from the crushing of peanuts is not

regulated under the Agreement or this

regulation.

Peanuts containing more than 25 ppb

aflatoxin are designated as ‘‘restricted’’

peanuts. Restricted peanut lots may or

may not meet quality requirements of

Table 1. At the direction of the importer,

restricted peanut lots must be used

either for seed (if dyed or treated),

crushed for oil, destroyed by burying

(under supervision of the inspection

service), or exported. Meal resulting

from the crushing of restricted peanuts

must be certified as to aflatoxin content

and such certification must accompany

the meal into the channels of commerce.

The importer can dispose of a failing

peanut lot directly to a non-edible

peanut outlet or set aside and

commingle several failing lots for

eventual disposition to one or more

non-edible outlets. Commingled failing

quality peanuts must be held separate

and apart from edible peanuts and

identified with red tags indicating nonedible peanuts. Eventual disposition

must be to non-edible peanut outlets

consistent with the failing quality of the

peanuts, pursuant to paragraph (e) of

this rule.

If an importer chooses to destroy

unrestricted or restricted peanuts by

burying, the peanuts must be lot

identified and disposition must be

reported to AMS. The importer must

provide inspection service and Customs

Service certification if a lot is buried, or

a Customs Service export declaration if

a lot is exported. Customs Service

procedures controlling re-exported

merchandise must also be followed by

the importer. Burying and exportation

expenses are borne by the importer.

It is the importer’s responsibility to

file inspection certificates and other

documentation sufficient to account for

disposition of all failing quality peanuts

acquired by the importer. Such proof

consists of copies of bills of lading and

sales receipts between the importer and

non-edible peanut outlet receivers. The

documentation must contain identifying

information, such as container or lot

numbers, that tie the peanuts reported

on the documents to failing quality

peanuts on inspection service or

aflatoxin certificates. The name and

address of the non-edible peanut

receiver and valid contact information

must also be specified on the

documentation.

Disposition of unrestricted and

restricted peanut lots must be reported

to AMS within 23 days of filing for

entry with the Customs Service, or, if a

redelivery notice is issued, within the

60-day redelivery period. As noted in

above, disposition of unrestricted and

restricted peanut lots may be carried out

and reported during the redelivery

demand period.

The inspection service identifies

imported peanuts as peanuts of foreign

origin on the inspection certificate to

assist in lot identification. Foreign

origin designations also help AMS meet

its monitoring responsibilities.

From time to time, the PAC may

recommend to the Secretary that quality

requirements or handling procedures

specified in the Agreement be revised.

If such changes are approved by the

Secretary and implemented for the

domestic peanut industry in 7 CFR Part

998, corresponding changes will be

made in § 999.600. Changes in

regulations for domestically produced

peanuts are generally made effective

July 1. Thus, corresponding changes to

the import regulation will be made

effective on that date, or as close to that

date as possible under informal

rulemaking, unless otherwise specified

in the regulation. Quality requirements

in effect on the date of inspection of a

foreign produced lot will be applied to

the inspected lot.

Safeguard Procedures

This rule establishes a procedure to

verify importers’ compliance with

import requirements. The safeguard

procedures provide for monitoring of

peanut lots from importation to final

disposition. The purpose of these

procedures are to ensure that foreign

produced peanuts either meet edible

requirements or are appropriately

disposed to non-edible peanut outlets,

exported or destroyed. The safeguard

procedures are similar to safeguard

procedures already in place for other

imported commodities and are

consistent with the inspection,

identification and certification

requirements applied to domestically

produced peanuts under the Agreement.

The safeguard process includes the

‘‘stamp-and-fax’’ entry procedure, as

already described, whereby the importer

provides the Customs Service with an

entry document stamped by the

inspection service. The importer also

files a copy of the entry document with

AMS and forwards a copy, with the

released lot, to the inland destination
Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations 31315

where the lot is to be inspected or

warehoused. Edible certification and

non-edible disposition is reported by

filing with AMS copies of all grade

certificates, aflatoxin certificates, and

proof of non-edible disposition. Such

certifications must be filed within 23

days of filing for entry, or, if a redelivery

notice is issued, within the 60-day

redelivery period.

Failure to report or redeliver peanuts

within applicable time frames could

result in liquidated damages against the

importer.

Certificates and other supplementary

documentation must be sent to AMS,

Marketing Order Administration Branch

(MOAB) which oversees the domestic

peanut program and this import

program. Facsimile or express mail

deliveries can be used to ensure timely

receipt of certificates and other required

documentation. Overnight and express

mail deliveries should be addressed to

the USDA, AMS, Marketing Order

Administration Branch, 14th and

Independence Avenue, SW., Room

2525, Washington, DC 20250, Attn:

Report of Imported Peanuts. The

MOAB’s fax number is (202) 720–5698,

Attn: Report of Imported Peanuts.

For the purposes of checking and

verifying reports filed by importers and

disposition outlets, this regulation

provides that importers must allow the

Secretary, through duly authorized

agents, to have access to any premises

where peanuts may be held and

processed. Authorized agents, at any

time during regular business hours, are

permitted to inspect any peanuts held,

and any and all records with respect to

the acquisition, holding or disposition

of any peanuts which may be held, or

which may have been disposed by that

importer.

USDA record retention requirements

also are established to require importers

to retain information for at least two

years beyond the year of applicability.

Customs Service record retention

requirements are longer.

The handling of each imported lot

must be consistent with Customs

Service procedures and reported in

accordance with normal Customs

Service requirements. Any Customs

Service reporting or recordkeeping

requirements for disposition of

imported merchandise or clearance of

bonding requirements are not

superseded by this regulation.

Paperwork Reduction Act

In accordance with the Paperwork

Reduction Act of 1980 (44 U.S.C.

Chapter 35) as amended in 1995, the

information and collection requirements

that are contained in this rule have been

approved by the Office of Management

and Budget (OMB) on a temporary basis

and have been assigned OMB number

0581–0176. A 60-day period was

established in the proposed rule to

receive comments on the information

collection requirements. All responses

to the request for comments will be

summarized and included in the request

for OMB approval. All comments will

become a matter of public record.

In addition to the reporting

requirements, this rule establishes that

importers and customs brokers retain

copies of all certifications and entry

documentation for not less than two

years after the calendar year of

acquisition. This is a commonly

accepted records retention period and

within good business practices. The

time for maintaining records by filing

each document internally is included in

the filing estimate. The information

collected is used only for compliance

purposes by personnel of the

Department.

The reporting and recordkeeping

requirements established in this rule

will enable the Department to oversee

the entry of peanuts and help ensure

that only good quality, wholesome

peanuts will be used in edible peanut

outlets in the U.S. Without the quality

requirements specified in the

Agreement (7 CFR Part 998), regulations

for non-signatory handlers (7 CFR Part

997), and these regulations, poor quality

peanuts could more easily be entered

into edible channels, causing consumer

dissatisfaction and having a negative

impact on the market for peanuts and

peanut products. Compliance with these

standards help the peanut industry in

its efforts to expand markets.

Although these requirements result in

some additional costs for importers, the

benefits from restricting low quality

peanuts from edible markets outweigh

any additional inspection, handling,

recordkeeping and reporting costs

resulting from the requirements. These

requirements have been carefully

reviewed and every effort has been

made to minimize any unnecessary

reporting and recordkeeping costs.

List of Subjects in 7 CFR part 999

Dates, Filberts, Food grades and

standards, Imports, Nuts, Peanuts,

Prunes, Raisins, Reporting and

recordkeeping requirements, Walnuts.

For the reasons set forth in the

preamble, 7 CFR part 999 is amended as

follows:

PART 999—SPECIALTY CROPS;

IMPORT REGULATIONS

1. The authority citation for 7 CFR

part 999 is revised to read as follows:

Authority: 7 U.S.C. 601–674; and 7 U.S.C.

1445c–3.

2. A new § 999.600 is added to part

999 to read as follows:

§ 999.600 Regulation governing imports of

peanuts.

(a) Definitions. (1) Peanuts means the

seeds of the legume Arachis hypogaea

and includes both inshell and shelled

peanuts produced in countries other

than the United States, other than those

marketed in green form for consumption

as boiled peanuts.

(2) Farmers stock peanuts means

picked and threshed raw peanuts which

have not been shelled, crushed, cleaned

or otherwise changed (except for

removal of foreign material, loose

shelled kernels, and excess moisture)

from the form in which customarily

marketed by producers.

(3) Inshell peanuts means peanuts, the

kernels or edible portions of which are

contained in the shell.

(4) Incoming inspection means the

sampling and inspection of farmers

stock peanuts to determine Segregation

quality.

(5) Segregation 1 peanuts, unless

otherwise specified, means farmers

stock peanuts with not more than 2

percent damaged kernels nor more than

1.00 percent concealed damage caused

by rancidity, mold, or decay and which

are free from visible Aspergillus flavus

mold.

(6) Segregation 2 peanuts, unless

otherwise specified, means farmers

stock peanuts with more than 2 percent

damaged kernels or more than 1.00

percent concealed damage caused by

rancidity, mold, or decay and which are

free from visible Aspergillus flavus

mold.

(7) Segregation 3 peanuts, unless

otherwise specified, means farmers’

stock peanuts with visible Aspergillus

flavus mold.

(8) Shelled peanuts means the kernels

of peanuts after the shells are removed.

(9) Outgoing inspection means the

sampling and inspection of either:

shelled peanuts which have been

cleaned, sorted, sized and otherwise

prepared for human consumption

markets; or inshell peanuts which have

been cleaned, sorted and otherwise

prepared for inshell human

consumption markets.

(10) Negative aflatoxin content means

15 parts-per-billion (ppb) or less for

peanuts which have been certified as

meeting edible quality grade

requirements, and 25 ppb or less for

non-edible quality peanuts.

(11) Person means an individual,

partnership, corporation, association, or

any other business unit.
31316 Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations

(12) Secretary means the Secretary of

Agriculture of the United States or any

officer or employee of the United States

Department of Agriculture (Department

or USDA) who is, or who may hereafter

be, authorized to act on behalf of the

Secretary.

(13) Inspection service means the

Federal or Federal-State Inspection

Service, Fruit and Vegetable Division,

Agricultural Marketing Service, USDA.

(14) USDA laboratory means

laboratories of the Science and

Technology Division, Agricultural

Marketing Service, USDA, that

chemically analyze peanuts for aflatoxin

content.

(15) PAC approved laboratories means

laboratories approved by the Peanut

Administrative Committee, pursuant to

Peanut Marketing Agreement No. 146 (7

CFR Part 998), that chemically analyze

peanuts for aflatoxin content.

(16) Conditionally released means

released from Customs Service custody

for further handling (sampling,

inspection, chemical analysis, or

storage) before final release.

(17) Importation means the arrival of

a peanut shipment at a port-of-entry

with the intent to enter the peanuts into

channels of commerce of the United

States.

(b) Incoming regulation: (1) Farmers

stock peanuts presented for

consumption must undergo incoming

inspection. Only Segregation 1 peanuts

may be used for human consumption.

All foreign produced farmers stock

peanuts for human consumption must

be sampled and inspected at a buying

point or other handling facility capable

of performing incoming sampling and

inspection. Sampling and inspection

shall be conducted by the inspection

service. Only Segregation 1 peanuts

certified as meeting the following

requirements may be used in human

consumption markets:

(i) Moisture. Except as provided under

paragraph (b)(2) Seed peanuts, of this

section, peanuts may not contain more

than 10.49 percent moisture: Provided,

That peanuts of a higher moisture

content may be received and dried to

not more than 10.49 percent moisture

prior to storage or milling.

(ii) Foreign material. Peanuts may not

contain more than 10.49 percent foreign

material, except that peanuts having a

higher foreign material content may be

held separately until milled, or moved

over a sand-screen before storage, or

shipped directly to a plant for prompt

shelling. The term sand-screen means

any type of farmers stock cleaner which,

when in use, removes sand and dirt.

(iii) Damage. For the purpose of

determining damage, other than

concealed damage, on farmers stock

peanuts, all percentage determinations

shall be rounded to the nearest whole

number.

(iv) Loose shelled kernels. Peanuts

may not contain more than 14.49

percent loose shelled kernels, except

that peanuts having a higher loose

shelled kernel content may be imported

if held separately until milled or

shipped directly to a shelling facility for

prompt shelling. All percentage

determinations shall be rounded to the

nearest whole number. Kernels which

ride screens with the following or larger

slot openings may be separated from

loose shelled kernels: Runner—16⁄64 x 3⁄4

inch; Spanish and Valencia—15⁄64 x 3⁄4

inch; Virginia—15⁄64 x 1 inch. If so

separated, those loose shelled kernels

which ride the screens may be included

with shelled peanuts prepared for

inspection and sale for human

consumption: Provided, That no more

than 5 percent of such loose shelled

kernels are kernels which would fall

through screens with such minimum

prescribed openings. Those loose

shelled kernels which do not ride the

screens shall be removed from the

farmers’ stock peanuts and shall be held

separate and apart from other peanuts

and disposed of for non-edible use,

pursuant to paragraph (e) of this section.

If the kernels which ride the prescribed

screen are not separated from the

kernels which do not ride the prescribed

screen, the entire amount of loose

shelled kernels shall be removed from

the farmers stock peanuts and shall be

held separate and apart and disposed of

for non-edible use, pursuant to

paragraph (e) of this section.

(2) Seed peanuts. Farmers stock

peanuts determined to be Segregation 1

quality, and shelled peanuts certified

negative to aflatoxin (15 ppb or less),

may be imported for seed purposes.

Disposition of such peanuts to a seed

outlet must be reported to the Secretary

by submitting a copy of the bill of lading

or sales contract which reports the

weight of the peanuts so disposed, and

the name, address and telephone

number of the receiving seed outlet.

Residuals from the shelling of

Segregation 1 seed peanuts shall be held

and/or milled separate and apart from

other peanuts, and such residuals

meeting quality requirements specified

in paragraph (c)(1) of this section may

be disposed to human consumption

channels, and any portion not meeting

such quality requirements shall be

disposed to non-edible peanut channels

pursuant to paragraph (e) of this section.

Segregation 2 and 3 peanuts may be

shelled for seed purposes but must be

dyed or chemically treated so as to be

unfit for human or animal consumption.

All disposition of seed peanuts and

residuals from seed peanuts shall be

reported to the Secretary pursuant to

paragraphs (g)(2) and (g)(3) of this

section. The receiving seed outlet must

retain records of the transaction,

pursuant to paragraph (h)(7) of this

section.

(3) Oilstock and exportation. Farmers

stock peanuts of lower quality than

Segregation 1 (Segregation 2 and 3

peanuts) shall be used only in nonedible outlets as provided herein.

Segregation 2 and 3 peanuts may be

commingled but shall be kept separate

and apart from edible quality peanut

lots. Commingled Segregation 2 and 3

peanuts and Segregation 3 peanuts shall

be disposed only to oilstock, exported

inshell, or exported as shelled if

fragmented as provided in paragraph

(e)(3) of this section. Shelled peanuts

and cleaned-inshell peanuts which fail

to meet the requirements for human

consumption in paragraph (b)(1) may be

crushed for oil or exported.

(4) Whenever the Secretary has reason

to believe that peanuts may have been

damaged or deteriorated while in

storage, the Secretary may reject the

then effective inspection certificate and

may require the importer to have the

peanuts reinspected to establish

whether or not such peanuts may be

disposed of for human consumption.

(c) Outgoing regulation. No person

shall import peanuts for human

consumption into the United States

unless such peanuts are lot identified

and certified by the inspection service

as meeting the following requirements:

(1)(i) Shelled peanuts. All shelled

peanuts shall at least meet the

requirements specified in Table 1 as

follows:
Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations 31317

TABLE 1.—MINIMUM GRADE REQUIREMENTS—PEANUTS FOR HUMAN CONSUMPTION

[Whole Kernels and Splits]

Maximum limitations

Excluding lots of ‘‘splits’’

Type and grade

category

Unshelled

peanuts and

damaged

kernels

(percent)

Unshelled

peanuts,

damaged

kernels and

minor

defects

(percent)

Fall through Foreign materials (percent)

Moisture

(percent)

Sound split and

broken kernels

Sound whole kernels Total

Runner .............................. 1.50 2.50 3.00%; 17⁄64 inch

round screen.

3.00%; 16⁄64× 3⁄4

inch; slot

screen.

4.00%; both

screens.

.20 9.00

Virginia (except No. 2) ..... 1.50 2.50 3.00%; 17⁄64 inch;

round screen.

3.00%; 15⁄64×1

inch; slot

screen.

4.00%; both

screens.

.20 9.00

Spanish and Valencia ...... 1.50 2.50 3.00%; 16⁄64 inch;

round screen.

3.00%; 15⁄64×3⁄4

inch; slot

screen.

4.00%; both

screens.

.20 9.00

No. 2 Virginia ................... 1.50 3.00 6.00%; 17⁄64 inch;

round screen.

6.00%; 15⁄64×1

inch; slot

screen.

6.00%; both

screens.

.20 9.00

Lots of ‘‘Splits’’

Runner (not more than 4%

sound whole kernels).

1.50 2.50 3.00%; 17⁄64 inch;

round screen.

3.00%; 14⁄64×3⁄4

inch; slot

screen.

4.00%; both

screens.

.20 9.00

Virginia (not less than

90% splits).

1.50 2.50 3.00%; 17⁄64 inch;

round screen.

3.00%; 14⁄64×1

inch slot

screen.

4.00%; both

screens.

.20 9.00

Spanish and Valencia (not

more than 4% sound

whole kernels).

1.50 2.50 3.00%; 16⁄64 inch;

round screen.

3.00%; 13⁄64×3⁄4

inch; slot

screen.

4.00%; both

screens.

.20 9.00

(ii) Peanuts meeting the specifications in Table 1 must also be certified ‘‘negative’’ to aflatoxin content, pursuant

to paragraph (d)(4) of this section, prior to shipment to domestic human consumption markets. Shelled peanuts meeting

requirements specified in Table 2 must be sampled pursuant to paragraph (d)(4) of this section but may be disposed

to human consumption outlets without testing for aflatoxin.

TABLE 2.— SUPERIOR QUALITY REQUIREMENTS—PEANUTS FOR HUMAN CONSUMPTION

[Whole Kernels and Splits]

Maximum limitations

Type and grade

category

Unshelled

peanuts and

damaged

kernels

(percent)

Unshelled

peanuts,

damaged

kernels and

minor

defects

(percent)

Fall through

Foreign materials

(percent)

Moisture

(percent) Sound split and

broken kernels

(percent)

Sound whole kernels

(percent)

Total

Runner U.S. No.1 and

better.

1.25 2.00 3.00%; 17⁄64 inch,

round screen.

3.00%; 16⁄64 x 3⁄4

inch, slot

screen.

4.00%; both

screens.

.10 9.00

Virginia U.S. No.1 and

better.

1.25 2.00 3.00%; 17⁄64 inch,

round screen.

3.00%; 15⁄64 x 1

inch, slot

screen.

4.00%; both

screens.

.10 9.00

Spanish and Valencia

U.S. No.1 and better.

1.25 2.00 3.00%; 16⁄64 inch,

round screen.

2.00%; 15⁄64 x 3⁄4

inch, slot

screen.

4.00%; both

screens.

.10 9.00

Runner U.S. Splits (not

more than 4% sound,

whole kernels).

1.25 2.00 2.00%; 17⁄64 inch,

round screen.

3.00%; 14⁄64 x 3⁄4

inch, slot

screen.

4.00%; both

screens.

.20 9.00
31318 Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations

TABLE 2.— SUPERIOR QUALITY REQUIREMENTS—PEANUTS FOR HUMAN CONSUMPTION—Continued

[Whole Kernels and Splits]

Maximum limitations

Type and grade

category

Unshelled

peanuts and

damaged

kernels

(percent)

Unshelled

peanuts,

damaged

kernels and

minor

defects

(percent)

Fall through

Foreign materials

(percent)

Moisture

(percent) Sound split and

broken kernels

(percent)

Sound whole kernels

(percent)

Total

Virginia U.S. Splits (not

less than 90% splits and

not more than 3.00%

sound whole kernels

and portions passing

through 20⁄64 inch round

screen).

1.25 2.00 3.00%; 17⁄64 inch,

round screen.

3.00%; 14⁄64 x 1

inch, slot

screen.

4.00%; both

screens.

.20 9.00

Spanish and Valencia

U.S. Splits (not more

than 4% sound, whole

kernels).

1.25 2.00 2.00%; 16⁄64 inch,

round screen.

3.00%; 13⁄64 x 3⁄4

inch, slot

screen.

4.00%; both

screens.

.20 9.00

Runner with splits (not

more than 15% sound

splits).

1.25 2.00 3.00%; 17⁄64 inch,

round screen.

3.00%; 16⁄64 x 3⁄4

inch, slot

screen.

4.00%; both

screens.

.10 9.00

Virginia with splits (not

more than 15% sound

splits).

1.25 2.00 3.00%; 17⁄64 inch,

round screen.

3.00%; 15⁄64 x 1

inch, slot

screen.

4.00%; both

screens.

.10 9.00

Spanish and Valencia with

splits (not more than

15% sound splits).

1.25 2.00 3.00%; 16⁄64 inch,

round screen.

2.00%; 15⁄64 x 3⁄4

inch, slot

screen.

4.00%; both

screens.

.10 9.00

(2) Cleaned-inshell peanuts. Peanuts

declared as cleaned-inshell peanuts may

be presented for sampling and outgoing

inspection in bags at the port-of-entry.

Alternatively, peanuts may be

conditionally released as cleanedinshell peanuts but shall not

subsequently undergo any cleaning,

sorting, sizing or drying process prior to

presentation for outgoing inspection as

cleaned-inshell peanuts. Cleanedinshell peanuts which fail outgoing

inspection may be reconditioned or

redelivered to the port-of-entry, at the

option of the importer. Cleaned-inshell

peanuts determined to be unprepared

farmers stock peanuts must be inspected

against incoming quality requirements

and determined to be Segregation 1

peanuts prior to outgoing inspection for

cleaned-inshell peanuts. Cleanedinshell peanuts intended for human

consumption may not contain more

than:

(i) 1.00 percent kernels with mold

present, unless a sample of such

peanuts is drawn by the inspection

service and analyzed chemically by a

USDA or PAC approved laboratory and

certified ‘‘negative’’ as to aflatoxin.

(ii) 2.00 percent peanuts with

damaged kernels;

(iii) 10.00 percent moisture (carried to

the hundredths place); and

(iv) 0.50 percent foreign material.

(3) Reconditioned peanuts. Peanuts

shelled, sized and sorted in another

country prior to arrival in the U.S. and

shelled peanuts which originated from

Segregation 1 peanuts that fail quality

requirements of Table 1 (excessive

damage, minor defects, moisture, or

foreign material) or are positive to

aflatoxin may be reconditioned by

remilling and/or blanching. After such

reconditioning, peanuts meeting the

quality requirements of Table 1 and

which are negative to aflatoxin (15 ppb

or less) may be disposed for edible

peanut use. Residuals resulting from

such reconditioning of failing lots shall

be positive lot identified, and red-tagged

if in sacks, and disposed of pursuant to

paragraphs (g)(2) and (g)(3) of this

section.

(d) Sampling and inspection. (1) All

sampling and inspection, quality

certification, chemical analysis, and lot

identification, required under this

section, shall be done by the inspection

service, a USDA laboratory, or a PACapproved laboratory, as applicable, in

accordance with the procedures

specified herein. The importer shall

make arrangements with the inspection

service for sampling, inspection, lot

identification and certification of all

peanuts accumulated by the importer.

The importer also shall make

arrangements for the appropriate

disposition of peanuts failing edible

quality requirements of this section. All

costs of sampling, inspection,

certification, identification, and

disposition incurred in meeting the

requirements of this section shall be

paid by the importer. Whenever peanuts

are offered for inspection, the importer

shall furnish any labor and pay any

costs incurred in moving and opening

containers as may be necessary for

proper sampling and inspection.

(2) For farmers stock inspection, the

importer shall cause the inspection

service to perform an incoming

inspection and to issue an CFSA–1007,

‘‘Inspection Certificate and Sales

Memorandum’’ form designating the lot

as Segregation 1, 2, or 3 quality peanuts.

For shelled and cleaned-inshell peanuts,

the importer shall cause the inspection

service to perform an outgoing

inspection and issue an FV–184–9A,

‘‘Milled Peanut Inspection Certificate’’

reporting quality and size of the shelled

or cleaned-inshell peanuts, whether the

lot meets or fails to meet quality

requirements for human consumption of

this section, and that the lot originated

in a country other than the United

States. The importer shall provide to the

Secretary copies of all CFSA 1007 and

FV–184–9A applicable to each peanut

lot conditionally released to the

importer. Such reports shall be

submitted as provided in paragraphs

(g)(2) and (g)(3) of this section.

(3) Procedures for sampling and

testing peanuts. Sampling and testing of
Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations 31319

peanuts for incoming and outgoing

inspections of peanuts presented for

consumption into the United States will

be conducted as follows:

(i) Application for sampling. The

importer shall request inspection and

certification services from one of the

following inspection service offices

convenient to the location where the

peanuts are presented for incoming and/

or outgoing inspection. To avoid

possible delays, the importer should

make arrangements with the inspection

service in advance of the inspection

date. A copy of the Customs Service

entry document specific to the peanuts

to be inspected shall be presented to the

inspection official prior to sampling of

the lot.

(A) The following offices provide

incoming farmers stock inspection:

Dothan, AL, tel: (205) 792–5185,

Graceville, FL, tel: (904) 263–3204,

Winter Haven, FL, tel: (813) 291–5820, ext

260,

Albany, GA, tel: (912) 432–7505,

Williamston, NC, tel: (919) 792–1672,

Columbia, SC, tel: (803) 253–4597,

Suffolk, VA, tel: (804) 925–2286,

Portales, NM, tel: (505) 356–8393,

Oklahoma City, OK, tel: (405) 521–3864,

Gorman, TX, tel: (817) 734–3006,

Yuma, AZ, tel: (602) 344–3869.

(B) The following offices, in addition

to the offices listed in paragraph (d)(3)(i)

(A) of this section, provide outgoing

sampling and/or inspection services,

and certify shelled and cleaned-inshell

peanuts as meeting or failing the quality

requirements of this section:

Eastern U.S.

Mobile, AL, tel: (205) 690–6154,

Jacksonville, FL, tel: (904) 359–6430,

Miami, FL, tel: (305) 592–1375,

Tampa, FL, tel: (813) 272–2470,

Presque Isle, ME, tel: (207) 764–2100,

Baltimore/Washington, tel: (301) 344–1860,

Boston, MA, tel: (617) 389–2480,

Newark, NJ, tel: (201) 645–2670,

New York, NY, tel: (212) 718–7665,

Buffalo, NY, tel: (716) 824–1585,

Philadelphia, PA, tel: (215) 336–0845,

Norfolk, VA, tel: (804) 441–6218,

Central U.S.

New Orleans, LA, tel: (504) 589–6741,

Detroit, MI, tel: (313) 226–6059,

St. Paul, MN, tel: (612) 296–8557,

Las Cruces, NM, tel: (505) 646–4929,

Alamo, TX, tel: (210) 787–4091,

El Paso, TX, tel: (915) 540–7723,

Houston, TX, tel: (713) 923–2557,

Western U.S.

Nogales, AZ, tel: (602) 281–0783,

Los Angeles, CA, tel: (213) 894–2489,

San Francisco, CA, tel: (415) 876–9313,

Honolulu, HI, tel: (808) 973–9566,

Salem, OR, tel: (503) 986–4620,

Seattle, WA, tel: (206) 859–9801.

(C) Questions regarding inspection

services or requests for further

assistance may be obtained from: Fresh

Products Branch, P.O. Box 96456, room

2049–S, Fruit and Vegetable Division,

AMS, USDA, Washington, D.C. 20090–

6456, telephone (202) 690–0604, fax

(202) 720–0393.

(ii) Sampling. Sampling of bulk

farmers’ stock lots shall be performed at

a facility that utilizes a pneumatic

sampler or approved automatic

sampling device. The size of farmers’

stock lots, shelled lots, and cleanedinshell lots, in bulk or bags, shall not

exceed 200,000 pounds. For farmers’

stock, shelled and cleaned-inshell lots

not completely accessible for sampling,

the applicant shall be required to have

lots made accessible for sampling

pursuant to inspection service

requirements. The importer shall cause

appropriate samples of each lot of edible

quality shelled peanuts to be drawn by

the inspection service. The amount of

such peanuts drawn shall be large

enough to provide for a grade and size

analysis, for a grading check-sample,

and for three 48-pound samples for

aflatoxin assay. Because there is no

acceptable method of drawing official

samples from bulk conveyances of

shelled peanuts, the importer shall

arrange to have bulk conveyances of

shelled peanuts sampled during the

unloading process. A bulk lot sampled

in this manner must be positive lot

identified by the inspection service and

held in a sealed bin until the associated

inspection and aflatoxin test results

have been reported.

(4) Aflatoxin assay. (i) The importer

shall cause appropriate samples of each

lot of shelled peanuts intended for

edible consumption to be drawn by the

inspection service. The three 48-pound

samples shall be designated by the

inspection service as ‘‘Sample 1IMP,’’

‘‘Sample 2IMP,’’ and ‘‘Sample 3IMP’’

and each sample shall be placed in a

suitable container and lot identified by

the inspection service. Sample 1IMP

may be prepared for immediate testing

or Samples 1IMP, 2IMP and 3IMP may

be returned to the importer for testing at

a later date, under lot identification

procedures.

(ii) The importer shall cause Sample

1IMP to be ground by the inspection

service or a USDA or PAC-approved

laboratory in a subsampling mill. The

resultant ground subsample shall be of

a size specified by the inspection

service and shall be designated as

‘‘Subsample 1–ABIMP.’’ At the

importer’s option, a second subsample

may also be extracted from Sample

1IMP and designated ‘‘Subsample 1–

CDIMP’’ which may be sent for aflatoxin

assay to a USDA or PAC-approved

laboratory. Both subsamples shall be

accompanied by a notice of sampling

signed by the inspector containing

identifying information as to the

importer, the lot identification of the

shelled peanut lot, and other

information deemed necessary by the

inspection service. Subsamples 1–

ABIMP and 1–CDIMP shall be analyzed

only in a USDA or PAC-approved

laboratory. The methods prescribed by

the Instruction Manual for Aflatoxin

Testing, SD Instruction-1, August 1994,

shall be used to assay the aflatoxin

level. The cost of testing and

notification of Subsamples 1–ABIMP

and 1–CDIMP shall be borne by the

importer.

(iii) The samples designated as

Sample 2IMP and Sample 3IMP shall be

held as aflatoxin check-samples by the

inspection service or the importer until

the analyses results from Sample 1IMP

are known. Upon call from the USDA or

PAC-approved laboratory, the importer

shall cause Sample 2IMP to be ground

by the inspection service in a

subsampling mill. The resultant ground

subsample from Sample 2IMP shall be

designated as ‘‘Subsample 2–ABIMP.’’

Upon further call from the laboratory,

the importer shall cause Sample 3IMP to

be ground by the inspection service in

a subsampling mill.

The resultant ground subsample shall

be designated as ‘‘Subsample 3–

ABIMP.’’ The importer shall cause

Subsamples 2–ABIMP and 3–ABIMP to

be sent to and analyzed only in a USDA

or PAC-approved laboratory. Each

subsample shall be accompanied by a

notice of sampling. The results of each

assay shall be reported by the laboratory

to the importer. All costs involved in

the sampling, shipment and assay

analysis of subsamples required by this

section shall be borne by the importer.

(iv)(A) Importers should contact one

of the following USDA or PAC-approved

laboratories to arrange for chemical

analysis.

Science and Technology Division, AMS/

USDA, P.O. Box 279, 301 West Pearl St.,

Aulander, NC 27805, Tel: (919) 345–1661

Ext. 156, Fax: (919) 345–1991

Science and Technology Division, AMS/

USDA, 1211 Schley Ave., Albany, GA

31707, Tel: (912) 430–8490 / 8491, Fax:

(912) 430–8534

Science and Technology Division, AMS/

USDA, P.O. Box 488, Ashburn, GA 31714,

Tel: (912) 567–3703

Science and Technology Division, AMS/

USDA, 610 North Main St., Blakely, GA

31723, Tel: (912) 723–4570, Fax: (912)

723–3294

Science and Technology Division, AMS/

USDA, P.O. Box 1368, Dothan, AL 36301,

Tel: (205) 792–5185, Fax: (205) 671–7984
31320 Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations

Science and Technology Division, AMS/

USDA, 107 South Fourth St., Madill, OK

73446, Tel: (405) 795–5615, Fax: (405)

795–3645

Science and Technology Division, AMS/

USDA, P.O. Box 272, 715 N. Main Street,

Dawson, GA 31742, Tel: (912) 995–7257,

Fax: (912) 995–3268

Science and Technology Division, AMS/

USDA, P.O. Box 1130, 308 Culloden St.,

Suffolk, VA 23434, Tel: (804) 925–2286,

Fax: (804) 925–2285

ABC Research, 3437 SW 24th Avenue,

Gainesville, FL 32607–4502, Tel: (904)

372–0436, Fax: (904) 378–6483

J. Leek Associates, Inc., P.O. Box 50395, 1200

Wyandotte (31705), Albany, GA 31703–

0395, Tel: (912) 889–8293, Fax: (912) 888–

1166

J. Leek Associates, Inc., P.O. Box 368, 675

East Pine, Colquitt, GA 31737, Tel: (912)

758–3722, Fax: (912) 758–2538

J. Leek Associates, Inc., P.O. Box 6, 502 West

Navarro St., DeLeon, TX 76444, Tel: (817)

893–3653, Fax: (817) 893–3640

J. Leek Associates, Inc., P.O. Box 548, 42 N.

Ellis St., Camilla, GA 31730, Tel: (912)

336–8781, Fax: (912) 336–0146

Pert Laboratories, P.O. Box 267, Peanut

Drive, Edenton, NC 27932, Tel: (919) 482–

4456, Fax: (919) 482–5370

Pert Laboratory South, P.O. Box 149, Hwy 82

East, Seabrook Drive, Sylvester, GA 31791,

Tel: (912) 776–7676, Fax: (912) 776–1137

Professional Service Industries, Inc., 3

Burwood Lane, San Antonio, TX 78216,

Tel: (210) 349–5242, Fax: (210) 342–9401

Southern Cotton Oil Company, 600 E. Nelson

Street, P.O. Box 180, Quanah, TX 79252,

Tel: (817) 663–5323, Fax: (817) 663–5091

Quanta Lab, 9330 Corporate Drive, Suite 703,

Selma, TX 78154–1257, Tel: (210) 651–

5799, Fax: (210) 651–9271.

(B) Further information concerning

the chemical analyses required pursuant

to this section may be obtained from:

Science and Technology Division,

USDA/AMS, P.O. Box 96456, room

3507–S, Washington, DC 20090–6456,

telephone (202) 720–5231, or facsimile

(202) 720–6496.

(v) Reporting aflatoxin assays. A

separate aflatoxin assay certificate, Form

CSSD–3 ‘‘Certificate of Analysis for

Official Samples’’ or equivalent PAC

approved laboratory form, shall be

issued by the laboratory performing the

analysis for each lot. The assay

certificate shall identify the importer,

the volume of the peanut lot assayed,

date of the assay, and numerical test

result of the assay. The results of the

assay shall be reported as follows.

(A) Lots containing 15 ppb or less

aflatoxin content shall be certified as

‘‘Meets U.S. import requirements for

edible peanuts under § 999.600 with

regard to aflatoxin.’’

(B) Lots containing more than 15 ppb

aflatoxin content shall be certified as

‘‘Fails to meet U.S. import requirements

for edible peanuts under § 999.600 with

regard to aflatoxin.’’ The importer shall

file USDA Form CSSD–3, or equivalent

form, with the Secretary, regardless of

result.

(5) Appeal inspection. In the event an

importer questions the results of a

quality and size inspection, an appeal

inspection may be requested by the

importer and performed by the

inspection service. A second sample

will be drawn from each container and

shall be double the size of the original

sample. The results of the appeal

sample shall be final and the fee for

sampling, grading and aflatoxin analysis

shall be charged to the importer.

(e) Disposition of peanuts failing

edible quality requirements. (1) Peanuts

failing grade and/or aflatoxin

requirements shall be designated as

non-edible quality ‘‘unrestricted’’

peanuts or ‘‘restricted’’ peanuts and

shall be crushed for oil, exported, or

disposed to other non-edible outlets as

specified in this section. For the

purposes of this regulation, the term

‘‘non-edible quality unrestricted

peanuts’’ means loose shelled kernels,

fall through, and pickouts from—and

the entire milled production of—

Segregation 1, Segregation 2, and

commingled Segregation 1 and 2

farmers stock peanuts which contain

more than 15 ppb and 25 ppb or less

aflatoxin. The term ‘‘non-edible quality

restricted peanuts’’ means loose shelled

kernels, fall through, and pickouts

from—and the entire milled production

of—Segregation 1, Segregation 2, and

commingled Segregation 1 and 2

farmers stock peanuts which contain in

excess of 25 ppb aflatoxin. The term

loose shelled kernels means peanut

kernels or portions of kernels

completely free of their hulls, as found

in deliveries of farmers stock peanuts or

those which fail to ride the screens

prescribed in paragraph (b)(1)(iv) of this

section; the term fall through means

sound split and broken kernels and

whole kernels which pass through

specified screens; and the term pickouts

means those peanuts removed during

the final milling process at the picking

table, by electronic equipment, or

otherwise during the milling process.

(2) Non-edible quality unrestricted

peanuts may be disposed to animal feed:

Provided, That such peanuts are

certified by the inspection service as to

moisture, foreign material content and

treated with a coloring agent or dyeing

solution covering at least 80 percent of

the peanuts, handled and shipped under

lot identification procedures. Except for

bulk loads, red tags shall be used and

marked ‘‘Animal Feed, Not For Human

Consumption.’’

(3) Lots of non-edible quality

unrestricted peanuts may be

commingled during or after

fragmentation and, if certified as

meeting fragmentation requirements by

the inspection service, such fragmented

peanuts may be exported. For the

purposes of this section, the term

fragmented means that not more than 30

percent of the peanuts shall be whole

kernels that ride the following screens,

by type: Spanish—15⁄64 x 3⁄4 inch slot;

Runner—16⁄64 x 3⁄4 inch slot; and

Virginia—15⁄64 x 1 inch slot. All peanut

lots exported must be lot identified by

the inspection service, certified as

exported by the Customs Service, and

reported to AMS pursuant to paragraphs

(g)(2) and (g)(3) of this section.

Applicable Customs Service procedures

for the export of merchandise must be

followed.

(4) Unrestricted fall through may be

disposed for use as wild-life feed and

rodent bait, if in labeled containers.

(5) Seed peanuts which are

chemically treated causing them to be

unfit for edible or animal feed use shall

be exempt from the requirements of

paragraph (c) of this section.

(6) Meal produced from the crushing

of unrestricted peanuts shall be exempt

from further aflatoxin testing. Meal

produced from the crushing of restricted

peanuts shall be tested and the

numerical test result of the chemical

assay shall be shown on a certificate

covering each lot and the certification

shall accompany each shipment or

disposition.

(7) Non-edible quality restricted

peanuts may be crushed for oil or

exported: Provided, That such peanuts

are positive lot identified, bagged, red

tagged, and so certified by the

inspection service.

(8) All certifications and proof of nonedible dispositions sufficient to account

for all peanuts in each consumption

entry filed by the importer must be

reported to the Secretary by the

importer pursuant to paragraphs (g)(2)

and (g)(3) of this section.

(f) Reconditioning of failing peanuts:

(1) Importers may remill and/or blanch

shelled peanuts which originated from

Segregation 1 peanuts that fail quality

requirements of Table 1 or are positive

to aflatoxin. After such reconditioning,

peanuts meeting the quality

requirements of Table 1 and which are

certified negative to aflatoxin (15 ppb or

less) may be disposed for edible use.

(2) Whole lots of remilled and/or

blanched peanuts, and residuals of such

peanuts, which continue to fail quality

requirements of Table 1 and contain 25

ppb or less aflatoxin content shall be

considered ‘‘non-edible quality

unrestricted’’ peanuts and shall be

disposed as ‘‘unrestricted’’ peanuts
Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations 31321

crushed for oil, exported, or animal

feed, pursuant to provisions of

paragraph (e) of the section. Meal

produced from unrestricted peanuts

shall be disposed pursuant to paragraph

(e)(6) of this section.

(3) Whole lots of remilled and/or

blanched peanuts, and residuals of such

peanuts, which continue to fail quality

requirements of Table 1 and contain

more than 25 ppb aflatoxin content,

shall be considered ‘‘non-edible quality

restricted’’ peanuts and shall be

disposed as ‘‘restricted’’ peanuts

pursuant to paragraph (e)(6) of this

section. Meal produced from restricted

peanuts shall be disposed pursuant to

paragraph (e)(6).

(4) All certifications and proof of nonedible dispositions sufficient to account

for all peanuts in each consumption

entry filed by the importer must be

reported to the Secretary by the

importer pursuant to paragraphs (g)(2)

and (g)(3) of this section.

(g) Safeguard procedures. (1) Prior to

arrival of a foreign produced peanut lot

at a port-of-entry, the importer, or

customs broker acting on behalf of the

importer, shall mail or send by facsimile

transmission (fax) a copy of the Customs

Service entry documentation for the

peanut lot or lots to the inspection

service office that will perform sampling

of the peanut shipment. More than one

lot may be entered on one entry

document. The documentation shall

include identifying lot(s) or container

number(s) and volume of the peanuts in

each lot being entered, and the location

(including city and street address), date

and time for inspection sampling. The

inspection office shall sign, stamp, and

return the entry document to the

importer. The importer shall present the

stamped document to the Customs

Service at the port-of-entry and send a

copy of the document to the Secretary.

The importer also shall cause a copy of

the entry document to accompany the

peanut lot and be presented to the

inspection service at the inland

destination of the lot.

(2) The importer shall file with the

Secretary copies of the entry document

and grade, aflatoxin, and lot

identification certifications sufficient to

account for all peanuts in each lot listed

on the entry document filed by the

importer. Positive lot identification of

residual lots, transfer certificates, and

other documentation providing proof of

non-edible disposition, such as bills of

lading, certificates of burying, export

declarations, and sales receipts which

report the weight of peanuts being

disposed and the name, address and

telephone number of the non-edible

peanut receiver, must be sent to the

Marketing Order Administration

Branch, Attn: Report of Imported

Peanuts. Facsimile transmissions and

overnight mail may be used to ensure

timely receipt of inspection certificates

and other documentation. Fax reports

should be sent to (202) 720–5698.

Overnight and express mail deliveries

should be addressed to USDA, AMS,

Marketing Order Administration

Branch, 14th and Independence

Avenue, SW, Room: 2525–S,

Washington, DC, 20250, Attn: Report of

Imported Peanuts. Regular mail should

be sent to AMS, USDA, P.O. Box 96456,

room 2526–S, Washington, DC 20090–

6456, Attn: Report of Imported Peanuts.

Telephone inquiries should be made to

(202) 720–6862.

(3) Certificates and other

documentation for each peanut lot must

be filed within 23 days of the date of

filing for consumption entry, or, if a

redelivery notice is issued on the peanut

lot, subsequently filed prior to

conclusion of the redelivery period

which will be 60 days, unless otherwise

specified by the Customs Service.

(4) The Secretary shall ask the

Customs Service to issue a redelivery

demand for foreign produced peanut

lots failing to meet requirements of this

section. Extensions in a redelivery

period granted by the Customs Service

will be correspondingly extended by the

Secretary, upon request of the importer.

Importers unable to account for the

disposition of all peanuts covered in a

redelivery order, or redeliver such

peanuts, shall be liable for liquidated

damages. Failure to fully comply with

quality and handling requirements or

failure to notify the Secretary of

disposition of all foreign produced

peanuts, as required under this section,

may result in a compliance investigation

by the Secretary. Falsification of reports

submitted to the Secretary is a violation

of Federal law punishable by fine or

imprisonment, or both.

(h) Additional requirements: (1)

Nothing contained in this section shall

preclude any importer from milling or

reconditioning, prior to importation,

any shipment of peanuts for the purpose

of making such lot eligible for

importation into the United States.

However, all peanuts presented for

entry for human consumption use must

be certified as meeting the quality

requirements specified in paragraph (c)

of this section.

(2) Conditionally released peanut lots

of like quality and belonging to the same

importer may be commingled. Defects in

an inspected lot may not be blended out

by commingling with other lots of

higher quality. Commingling also must

be consistent with applicable Customs

Service regulations. Commingled lots

must be reported and disposed of

pursuant to paragraphs (e)(2) and (e)(3)

respectively of this section.

(3) Inspection by the Federal or

Federal-State Inspection Service shall be

available and performed in accordance

with the rules and regulations governing

certification of fresh fruits, vegetables

and other products (7 CFR part 51). The

importer shall make each conditionally

released lot available and accessible for

inspection as provided herein. Because

inspectors may not be stationed in the

immediate vicinity of some ports-ofentry, importers must make

arrangements for sampling, inspection,

and certification through one of the

offices and laboratories listed in

paragraphs (d)(3) and (d)(4),

respectively, of this section.

(4) Imported peanut lots sampled and

inspected at the port-of-entry, or at other

locations, shall meet the quality

requirements of this section in effect on

the date of inspection.

(5) A foreign-produced peanut lot

entered for consumption or for

warehouse may be transferred or sold to

another person: Provided, That the

original importer shall be the importer

of record unless the new owner applies

for bond and files Customs Service

documents pursuant to 19 CFR

§§ 141.113 and 141.20: and Provided

further, That such peanuts must be

certified and reported to the Secretary

pursuant to paragraphs (g)(2) and (g)(3)

of this section.

(6) The cost of transportation,

sampling, inspection, certification,

chemical analysis, and identification, as

well as remilling and blanching, and

further inspection of remilled and

blanched lots, and disposition of failing

peanuts, shall be borne by the importer.

Whenever peanuts are presented for

inspection, the importer shall furnish

any labor and pay any costs incurred in

moving, opening containers, and

shipment of samples as may be

necessary for proper sampling and

inspection. The inspection service shall

bill the importer for fees covering

quality and size inspections; time for

sampling; packaging and delivering

aflatoxin samples to laboratories;

certifications of lot identification and lot

transfer to other locations, and other

inspection certifications as may be

necessary to verify edible quality or

non-edible disposition, as specified

herein. The USDA and PAC-approved

laboratories shall bill the importer

separately for fees for aflatoxin assay.

The importer also shall pay all required

Customs Service costs as required by

that agency.
31322 Federal Register / Vol. 61, No. 119 / Wednesday, June 19, 1996 / Rules and Regulations

(7) Each person subject to this section

shall maintain true and complete

records of activities and transactions

specified in this part. Such records and

documentation accumulated during

entry shall be retained for not less than

two years after the calendar year of

acquisition, except that Customs Service

documents shall be retained as required

by that agency. The Secretary, through

duly authorized representatives, shall

have access to any such person’s

premises during regular business hours

and shall be permitted, at any such

time, to inspect such records and any

peanuts held by such person.

(8) The provisions of this section do

not supersede any restrictions or

prohibitions on peanuts under the

Federal Plant Quarantine Act of 1912,

the Federal Food, Drug and Cosmetic

Act, any other applicable laws, or

regulations of other Federal agencies,

including import regulations and

procedures of the Customs Service.

Dated: June 11, 1996.

Robert C. Keeney,

Director, Fruit and Vegetable Division.

[FR Doc. 96–15361 Filed 6–18–96; 8:45 am]

BILLING CODE 3410–02–P