Document ID: FDA-2011-F-0171-0001
Agency: fda
Document Type: Proposed Rule
Title: Food Labeling: Calorie Labeling of Articles of Food in Vending Machines
Posted Date: 2011-04-06T04:00Z

[Federal Register Volume 76, Number 66 (Wednesday, April 6, 2011)]
[Proposed Rules]
[Pages 19238-19255]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-8037]

[[Page 19237]]

Vol. 76

Wednesday,

No. 66

April 6, 2011

Part III

Department of Health and Human Services

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Food and Drug Administration

21 CFR Parts 11 and 101

Food Labeling; Calorie Labeling of Articles of Food in Vending 
Machines; Proposed Rule

  Federal Register / Vol. 76, No. 66 / Wednesday, April 6, 2011 / 
Proposed Rules  

[[Page 19238]]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Parts 11 and 101

[Docket No. FDA-2011-F-0171]
RIN 0910-AG56

Food Labeling; Calorie Labeling of Articles of Food in Vending 
Machines

AGENCY: Food and Drug Administration, HHS.

ACTION: Proposed rule.

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SUMMARY: To implement the vending machine labeling provisions of the 
Patient Protection and Affordable Care Act of 2010 (Affordable Care 
Act), the Food and Drug Administration (FDA) is proposing requirements 
for providing calorie information for certain articles of food sold 
from vending machines. The Affordable Care Act, in part, amended the 
Federal Food, Drug and Cosmetic Act (FD&C Act) to, among other things, 
require that for an article of food sold from a vending machine that 
does not permit a prospective purchaser to examine the Nutrition Facts 
Panel before purchasing the article, or does not otherwise provide 
visible nutrition information at the point of purchase, and is operated 
by a person engaged in the business of owning or operating 20 or more 
vending machines, the vending machine operator must disclose the number 
of calories for the article of food. Vending machine operators not 
subject to the requirements of the Affordable Care Act may elect to be 
subject to the Federal requirements by registering with FDA. Providing 
calorie disclosures for food sold from vending machines would assist 
consumers in making healthier dietary choices.

DATES: Submit either written or electronic comments on the proposed 
rule by July 5, 2011. Submit comments on the information collection 
issues under the Paperwork Reduction Act of 1995 by May 6, 2011, (see 
the ``Paperwork Reduction Act of 1995'' section of this document).

ADDRESSES: You may submit comments, identified by Docket No. FDA-2011-
F-0171 and/or RIN 0910-AG56, by any of the following methods, except 
that comments on information collection issues under the Paperwork 
Reduction Act of 1995 must be submitted to the Office of Regulatory 
Affairs, Office of Management and Budget (OMB) (see the ``Paperwork 
Reduction Act of 1995'' section of this document).

Electronic Submissions

    Submit electronic comments in the following way:
    Federal eRulemaking Portal: http://www.regulations.gov. Follow the 
instructions for submitting comments.

Written Submissions

    Submit written submissions in the following ways:
    FAX: 301-827-6870.
    Mail/Hand delivery/Courier (for paper, disk, or CD-ROM 
submissions): Division of Dockets Management (HFA-305), Food and Drug 
Administration, 5630 Fishers Lane, rm. 1061, Rockville, MD 20852.
    Instructions: All submissions received must include the Agency name 
and docket number and Regulatory Information Number (RIN) for this 
rulemaking. All comments received may be posted without change to 
http://www.regulations.gov, including any personal information 
provided. For additional information on submitting comments, see the 
``Comments'' heading of the SUPPLEMENTARY INFORMATION section of this 
document.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.regulations.gov and insert the 
docket number, found in brackets in the heading of this document, into 
the ``Search'' box and follow the prompts and/or go to the Division of 
Dockets Management, 5630 Fishers Lane, rm. 1061, Rockville, MD 20852.

FOR FURTHER INFORMATION CONTACT: Daniel Y. Reese, Center for Food 
Safety and Applied Nutrition (HFS-820), Food and Drug Administration, 
5100 Paint Branch Pkwy., College Park, MD 20740, 301-436-2371.

SUPPLEMENTARY INFORMATION:

I. Background

A. Nutrition Labeling Requirements That Currently Apply to Packaged 
Foods

    The Nutrition Labeling and Education Act of 1990 (NLEA) amended the 
FD&C Act, in part, by adding section 403(q) (21 U.S.C. 343(q)), which 
specifies, in pertinent part and with certain exceptions, that a food 
is considered to be misbranded unless its label or labeling bears 
nutrition information. See 21 U.S.C. 343(q)(1). When a food is in 
package form, the required nutrition information generally must appear 
on the label of the food. FDA's final regulations establishing 
nutrition labeling requirements were published in 1993 (58 FR 2079, 
January 6, 1993) and are found at Title 21 of the Code of Federal 
Regulations (21 CFR) section 101.9. Regulations implementing the NLEA 
require nutrition information for a food product intended for human 
consumption and offered for sale unless an exemption is provided for 
the product (Sec.  101.9(a)). The declaration of nutrition information 
on the label and labeling of food generally must include information 
about the following nutrients: Total calories, calories from fat 
(unless the product contains less than 0.5 g of fat), total fat, 
saturated fat, trans fat, cholesterol, sodium, total carbohydrate, 
dietary fiber, sugars, protein, and certain vitamins and minerals 
(Sec.  101.9).
    The NLEA amendments to the FD&C Act included an exemption from 
nutrition labeling for food that is served in restaurants or other 
establishments in which food is served for immediate human consumption 
or sold for sale or use in such establishments (21 U.S.C. 343 
(q)(5)(A)(i)). The NLEA amendments to the FD&C Act also included an 
exemption from nutrition labeling for food that is processed and 
prepared primarily in a retail establishment, ready for human 
consumption, of the type of food described in section 403(q)(5)(A)(i) 
of the FD&C Act, offered for sale to consumers but not for immediate 
human consumption in such establishment, and not offered for sale 
outside such establishment (21 U.S.C. 343(q)(5)(A)(ii)). However, these 
exemptions were contingent on there being no nutrient content claims or 
health claims made on the label or labeling, or in the advertising, for 
the food. In our regulations implementing these exemptions, we included 
vending machines among the examples of establishments in which food is 
served for immediate human consumption that generally are exempt from 
nutrition labeling requirements because like the other examples, 
vending machines offer food products that are generally consumed 
immediately where purchased or while the consumer is walking away. See 
Sec.  101.9(j)(2).

B. Requirements of Section 4205 of the Affordable Care Act

    On March 23, 2010, the Affordable Care Act (Pub. L. 111-148) was 
signed into law. Section 4205 of the Affordable Care Act (section 
4205), amends section 403(q) of the FD&C Act, which governs nutrition 
labeling requirements, and section 403A of the FD&C Act (21 U.S.C. 343-
1), which governs Federal preemption of State and local food labeling 
requirements. The Affordable Care Act requires FDA to issue proposed 
regulations to carry out section 403(q)(5)(H) of the FD&C Act no later

[[Page 19239]]

than one year from the date of enactment. As amended, section 
403(q)(5)(H)(viii) of the FD&C Act requires that if an article of food 
is sold from a vending machine that does not permit a prospective 
purchaser to examine the Nutrition Facts Panel before purchasing the 
food or does not otherwise provide visible nutrition information at the 
point of purchase and the vending machine is operated by a person who 
is engaged in the business of owning or operating 20 or more vending 
machines, the vending machine operator must provide calorie information 
for the food. Specifically, the vending machine operator must ``provide 
a sign in close proximity to each article of food or the selection 
button that includes a clear and conspicuous statement disclosing the 
number of calories contained in the article.''
    Section 403(q)(5)(H)(ix) of the FD&C Act allows vending machine 
operators not subject to the requirements of section 4205 of the 
Affordable Care Act to voluntarily register with FDA to become subject 
to the Federal requirements. In the Federal Register of July 23, 2010, 
(75 FR 43182), FDA published a notice in the Federal Register 
specifying the terms and conditions for implementation of voluntary 
registration, pending promulgation of final regulations. See 75 FR 
43182.

C. FDA Activities Related to Implementation of Section 4205 of the 
Affordable Care Act

    Section 4205 of the Affordable Care Act also requires certain 
restaurants and similar retail food establishments to provide calorie 
and other nutrition information for standard menu items, including food 
on display and self-service food. Elsewhere in this issue of the 
Federal Register, FDA is proposing requirements to implement the menu 
labeling provisions of section 4205. As discussed in that proposal, FDA 
has published in the Federal Register a number of documents concerning 
section 4205. On July 7, 2010, FDA published a notice entitled 
``Disclosure of Nutrient Content Information for Standard Menu Items 
Offered for Sale at Chain Restaurants or Similar Retail Food 
Establishments and for Articles of Food Sold from Vending Machines'' 
(``docket notice'') (75 FR 39026, July 7, 2010) to solicit comments and 
suggestions on the new law. In response to this notice, FDA received 
approximately 875 letters and e-mails. Of those, approximately 60 
contained one or more comments pertaining to vending machine calorie 
labeling. Many of these comments were general comments on the law 
itself and either supported or opposed the requirement in section 
403(q)(5)(H)(viii) of the FD&C Act that calorie information be provided 
for foods sold from vending machines. Comments in opposition stated 
that providing calorie information for foods sold from vending machines 
would be overly burdensome to the industry. FDA describes these 
comments in more detail and responds to those comments in this 
proposal.
    On July 23, 2010, FDA published the Federal Register notice 
entitled ``Voluntary Registration by Authorized Officials of Non-
Covered Retail Food Establishments and Vending Machine Operators 
Electing to be Subject to the Menu and Vending Machine Labeling 
Requirements Established by Section 4205 of the Patient Protection and 
Affordable Care Act of 2010'' (``registration notice'') (75 FR 43182). 
FDA issued this registration notice to provide assistance for voluntary 
registration for restaurants, similar retail establishments, and 
vending machine operators that are not subject to the nutrition 
labeling requirements of section 4205 (e.g., restaurants and similar 
retail food establishments with fewer than 20 locations, and vending 
machine operators with fewer than 20 machines). In the registration 
notice, FDA specified the terms and conditions for implementation of 
voluntary registration, pending promulgation of regulations. In 
response to the notice, FDA received 7 comments, none of which 
addressed registration.
    On August 25, 2010, FDA published a ``Guidance for Industry: 
Questions and Answers Regarding the Effect of Section 4205 of the 
Patient Protection and Affordable Care Act of 2010 on State and Local 
Menu and Vending Machine Labeling Laws'' (``preemption guidance'') (75 
FR 52427, August 25, 2010). The preemption guidance discusses the 
preemptive effect of section 4205 and identifies the provisions of 
amended section 403(q) of the FD&C Act that became requirements upon 
enactment. Our current thinking on the preemptive effect of section 
4205 is set out in section VII of this document.
    Also on August 25, 2010, FDA published a ``Draft Guidance for 
Industry: Questions and Answers Regarding the Menu Labeling Provisions 
of Section 4205 of the Patient Protection and Affordable Care Act of 
2010; Availability'' (``draft implementation guidance'') (75 FR 52426, 
August 25, 2010). This draft guidance addressed only the menu labeling 
provisions of section 4205. It did not address the calorie labeling 
requirements for vending machine operators in section 4205. FDA 
subsequently withdrew the draft implementation guidance (76 FR 4360, 
January 25, 2011).

II. Legal Authority

    As stated in section I.C. of this document, on March 23, 2010, the 
Affordable Care Act was signed into law. Section 4205 of the Affordable 
Care Act amended 403(q)(5) of the FD&C Act (21 U.S.C. 343(q)(5)) by 
amending section 403(q)(5)(A) and by creating new clause (H) to 
require, in relevant part, that vending machine operators provide 
calorie information for certain articles of food sold from vending 
machines. Under section 403(a)(1), such information must be truthful 
and nonmisleading. Food to which these requirements apply is deemed 
misbranded if these requirements are not met. In addition, under 
section 201(n) of the FD&C Act (21 U.S.C. 321(n)), the labeling of food 
is misleading if it fails to reveal facts that are material in light of 
representations actually made in the labeling. Section 403(q)(5)(H)(x) 
requires the Secretary of Health and Human Services (Secretary) to 
issue proposed regulations no later than 1 year after enactment . Thus, 
FDA has the authority to issue this proposed rule under sections 
201(n), 403(a)(1), and 403(q)(5)(H), as well as under section 701(a) of 
the FD&C Act (21 U.S.C. 371(a)), which vests the Secretary with the 
authority to issue regulations for the efficient enforcement of the 
FD&C Act.
    FDA is proposing requirements that vending machine operators 
provide calorie information for certain articles of food sold from 
vending machines. FDA is also proposing the terms and conditions for 
voluntary registration by vending machine operators not subject to the 
requirements of section 4205 of the Affordable Care Act that elect to 
become subject the requirements. FDA is proposing to set out these 
provisions in new Sec.  101.8.

III. The Proposal

A. Definitions

    We are proposing in the introductory paragraph of Sec.  101.8(a) 
that the terms defined in section 201 of the FD&C Act are applicable 
when these terms are used. Additional terms are defined alphabetically 
in the proposed codified and are discussed in alphabetical order in 
this section. ``Act'' is defined as the Federal Food, Drug, and 
Cosmetic Act.

[[Page 19240]]

1. Authorized Official of a Vending Machine Operator
    We are proposing in Sec.  101.8(a) that the term ``authorized 
official of a vending machine operator'' means the owner, operator, or 
agent in charge of a vending machine, or any other person authorized by 
a vending machine operator not subject to the requirements of section 
4205 of the Affordable Care Act to voluntarily register the vending 
machine operator with FDA to become subject to the requirements. For 
the purposes of this definition, the agent in charge would not be the 
person who is only in charge or in control of the location where the 
vending machine is located.
2. Vending Machine Operator
    We are proposing in Sec.  101.8(a) that the term ``vending machine 
operator'' means a person that controls or directs the function of the 
vending machine, including deciding which articles of food are sold 
from the vending machine or the placement of the articles of food 
within the vending machine, and is compensated for the control or 
direction of the function of the vending machine. Section 201(e) of the 
FD&C Act defines ``person'' to include an individual, partnership, 
corporation, and association. For example, a vending machine operator 
could be a corporation that manufacturers beverages and sells these 
products in its machines. A vending machine operator also could be an 
individual or a business that only operates and stocks vending 
machines, such as a private company with onsite vending machines.
3. Vending Machine
    Section 403(q)(5)(H)(viii) of the FD&C Act sets forth labeling 
requirements for certain vending machine food but does not define the 
term ``vending machine.'' We are proposing in Sec.  101.8(a) that the 
term ``vending machine'' means a self-service device that, upon 
insertion of a coin, paper currency, token, card, or key, or by 
optional manual operation, dispenses servings of food in bulk, in 
packages, or prepared by the machine, without the necessity of 
replenishing the device between each vending operation. This definition 
is almost identical to the definition of ``vending machine'' in the FDA 
Food Code 2009.\1\ Examples of food dispensed from vending machines may 
include prepackaged foods (e.g., candy, snacks, gum, bottled or canned 
soft drinks), unpackaged bulk foods (e.g., handful of gum, candy, or 
mixed nuts), prepared foods (e.g., sandwiches or fresh fruit), multi-
serving foods (e.g., gallon of milk), or foods prepared in the machine 
and dispensed in bulk (e.g., coffee, soup, or popcorn).
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    \1\ FDA regularly publishes the Food Code, which provides 
guidance on food safety, sanitation, and fair dealing that can be 
uniformly adopted by State and local governments for the retail 
segment of the food industry. The Food Code provisions are not 
Federal requirements; however, they are designed to be consistent 
with Federal food laws and regulations. The 2009 Food Code defined 
the term ``vending machine'' to mean a ``self-service device that, 
upon insertion of a coin, paper currency, token, card, or key, or by 
optional manual operation, dispenses unit servings of food in bulk 
or in packages without the necessity of replenishing the device 
between each vending operation.'' (U.S. Public Health Service, FDA, 
2009 Food Code, U.S. Department of Health and Human Services, Public 
Health Service, Food and Drug Administration, College Park, MD 
20740, chapter 1, section 1-201.) http://www.fda.gov/Food/FoodSafety/RetailFoodProtection/FoodCode/FoodCode2009/ucm186464.htm.
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B. Who Must Comply With This Rule

    Section 4205 of the Affordable Care Act provides that ``in the case 
of an article of food sold from a vending machine that does not permit 
a prospective purchaser to examine the Nutrition Facts Panel before 
purchasing the article, or does not otherwise provide visible nutrition 
information at the point of purchase, and is operated by a person 
engaged in the business of owning or operating 20 or more vending 
machines, the vending machine operator shall provide a sign in close 
proximity to each article of food or the selection button that includes 
a clear and conspicuous statement disclosing the number of calories 
contained in the article of food.'' Consistent with the requirements of 
section 4205, all vending machine operators with 20 or more vending 
machines, as defined in section III.A.3. of this document, will be 
subject to these requirements. Therefore, FDA is proposing in Sec.  
101.8(c)(1)(i)(A) and (B) that the labeling requirements of this 
proposed rule apply to vending machine operators that own or operate 20 
or more vending machines that do not allow a prospective purchaser to 
examine the Nutrition Facts Panel prior to purchase or do not otherwise 
provide visible nutrition information at the point of purchase. As 
discussed in below in section III.D. of this document, vending machine 
operators that are not subject to the requirements of the law may elect 
to be subject to the Federal requirements by voluntarily registering 
with FDA.
    Several comments requested that FDA apply the small business 
nutrition labeling exemption (Sec.  101.9(j)(1)) to vending machine 
operators. The comments said that: (1) 90-95 percent of vending machine 
operators have 20 or more machines, and therefore, would be covered by 
section 403(q)(5)(H) of the FD&C Act and (2) 70 percent of vending 
machine operators have three or fewer employees, and would likely be 
generating sales less than $500,000.
    FDA is not proposing an exemption from the vending machine 
nutrition labeling requirements for small businesses. FDA notes that 
section 403(q)(5)(H) of the FD&C Act does not include an exemption from 
the vending machine nutrition labeling requirements for small 
businesses. Section 403(q)(5)(D) includes an exemption from the 
nutrition labeling requirements in sections 403(q)(1) through (q)(4) 
for small businesses. The requirement that vending machine operators 
disclose calories for covered vending machine food is not found in 
sections 403(q)(1) through (q)(4); instead, it is found in section 
403(q)(5)(H)(viii). Therefore, the small business exemption in 
403(q)(5)(D) does not apply. We believe that the proposed rule provides 
adequate flexibility to allow these small businesses to comply with the 
proposed requirements in a cost-effective and equitable way. For 
example, the proposed requirements allow vending machine operators to 
choose from various approaches for compliance, including adopting less 
expensive measures as discussed below in section III.E. and section IV. 
of this document. We request comment on additional ways that FDA can 
make the requirements of this rule less burdensome on small businesses, 
while still meeting the requirements of section 403(q)(5)(H).
    The Agency also received comments regarding operators of vending 
machines who are blind and operate vending machines through the Vending 
Facility Program operated by the U.S. Department of Education under the 
Randolph-Sheppard Act of 1936, 20 U.S.C. 107 et seq. These comments 
suggested that regardless of the number of machines that were operated 
by an operator, all operators of vending machines under the Randolph-
Sheppard Act would be covered.
    The Agency wishes to clarify its interpretation of the 
applicability of section 4205 of the Affordable Care Act to vending 
machine operators who fall under the Randolph-Sheppard Act. Section 
403(q)(5)(H)(viii) of the FD&C Act sets forth requirements for vending 
machine operators based on the number of machines that they operate. 
Thus, as with other operators, Randolph-Sheppard Act operators would 
only be covered by the disclosure requirements if they operate 20 or 
more vending

[[Page 19241]]

machines that dispense food or if they voluntarily register to be 
covered.
    These comments also stated that operators of vending machines who 
are blind ``may place different products in the same row due to limited 
visual recognition and the similarity of product packaging.'' These 
comments requested flexibility for posting calorie information. 
Specifically, the comments requested that the calorie disclosure 
requirements permit the ``stacking of multiple products in the same 
coil.''
    FDA is proposing requirements that provide flexibility for vending 
machine operators to comply with the labeling requirements for covered 
vending machine food. As discussed later in this document, the required 
calorie information may be posted on a sign adjacent to the vending 
machine, so long as the sign is visible to the prospective purchaser at 
the same time as the food, its description, or its selection button is 
visible.

C. Who Is Not Required to Comply With This Rule

    FDA is aware that many vending machine operators operate machines 
that dispense a variety of articles other than articles of food. For 
example, some vending machines may dispense detergent, compact discs, 
gift cards or toiletries. If a vending machine operator operated a 
total of 50 vending machines, only 15 of which sell articles of food, 
the vending machine operator would not be subject to the requirements 
of 403(q)(5)(H)(viii) of the FD&C Act because the vending machine 
operator operates fewer than 20 vending machines that sell articles of 
food.
    Further, FDA tentatively concludes that vending machines that may 
dispense food as part of a game or other non-food related activity are 
not covered by 403(q)(5)(H) of the FD&C Act. For example, a vending 
machine may contain a variety of items ranging from small toys, coins, 
or individually wrapped candies that can be picked up by maneuvering a 
large claw arm. In this instance, the vending machine does not sell 
articles of food, even though in the course of maneuvering the arm, 
candies could be dispensed. The vending machine is selling the 
opportunity to play the game. FDA seeks comment on this tentative 
conclusion.
    Bulk vending machines dispense unpackaged articles of food in 
preselected amounts (e.g. gumball machines, mixed nut machines). FDA 
received a few comments suggesting that bulk vending machines are 
different from ``more modern types of vending machines,'' and therefore 
should be exempt from these disclosure requirements. The comments 
argued that bulk vending machines should be distinguished from other 
vending machines for three reasons. First, they noted that these 
machines do not have selection buttons, and as a result a vending 
machine operator could not place a sign ``in close proximity to * * * 
the selection button'' that includes the calorie information required 
by section 403(a)(5)(H)(viii)(I) of the FD&C Act. Second, they argued 
that food sold from bulk vending machines represents only a small 
fraction of overall market sales of the vending machine industry. 
Finally, the comments stated that there is no reported association 
between foods sold from bulk vending machines and obesity.
    FDA notes that section 403(q)(5)(H)(viii) of the FD&C Act does not 
limit its applicability to vending machines for which there has been a 
reported association between the food vended by the machine and 
obesity. However, section 403(q)(5)(H)(viii) provides that for covered 
vending machine food, the vending machine operator must provide a sign 
disclosing the number of calories contained in the food ``in close 
proximity to each article of food or the selection button.'' FDA 
tentatively concludes that the reference to ``selection button'' in the 
statute can be read to mean that the types of vending machines subject 
to requirements in section 403(q)(5)(H)(viii) are those with selection 
buttons. FDA is not aware of vending machines without selection buttons 
other than bulk vending machines that dispense, by use of a crank, 
single types of unpackaged articles of food in preselected amounts 
(e.g., a single piece of gum or a handful of candy or nuts). FDA 
tentatively concludes that vending machines, including bulk vending 
machines, without any type of selection button are not covered by 
section 403(q)(5)(H)(viii). However, FDA tentatively concludes that a 
bulk vending machine that has a selection button, regardless of the 
type of food it dispenses, e.g., unpackaged articles of food such as 
soup, popcorn, or hot or cold beverages, is covered under section 
403(q)(5)(H)(viii), if it meets the other statutory criteria. FDA is 
proposing in Sec.  101.8(c)(1)(i)(C) that the nutrition labeling 
requirements of Sec.  101.8 apply to an article of food sold from a 
vending machine that, among other things, has a selection button. FDA 
seeks comment on these tentative conclusions. FDA is also interested in 
comments demonstrating any unintended adverse effect resulting from the 
exclusion of vending machines without selection buttons from the 
calorie labeling requirements.

D. Voluntary Registration by a Vending Machine Operator That Is Not 
Subject to the Requirements of Section 4205 of the Affordable Care Act 
That Elects To Be Subject to the Requirements

    Section 4205 of the Affordable Care Act provides that vending 
machine operators not subject to the requirements of section 
403(q)(5)(H)(viii) \2\ of the FD&C Act may elect to become subject to 
the requirements by registering ``biannually'' with FDA (21 U.S.C. 
343(q)(5)(H)(ix)). As discussed below, operators that choose to be 
subject to the Federal requirements would not be subject to non-
identical state or local nutrition labeling laws for food sold from 
vending machines. In the proposed rule entitled: Food Labeling; 
Nutrition Labeling of Standard Menu Items in Restaurants and Similar 
Retail Food Establishments, published elsewhere in this issue of the 
Federal Register, FDA explains that ``biannual'' can be defined as 
occurring twice every year or as occurring every other year. (Ref. 1). 
FDA tentatively concludes that registration every other year is a more 
reasonable interpretation, because it does not seem warranted or 
necessary for a vending machine operator to tell FDA every 6 months 
that the operator wants to be subject to Federal requirements. FDA 
began accepting registrations on July 21, 2010, and will continue to 
accept them on a continuous basis. FDA is proposing in Sec.  101.8(d) 
that an authorized official for a vending machine operator that is not 
subject to the Federal requirements may register with FDA every other 
year by providing FDA the following information:
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    \2\ As discussed in section I.B. of this document, vending 
machine operators that own or operate fewer than 20 vending machines 
could elect to be subject to the requirements of 403(q)(5)(H)(viii) 
of the FD&C Act by voluntarily registering with FDA.
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     The contact information (including name, address, phone 
number, e-mail address), for the vending machine operator;
     The address of the location of each vending machine owned 
or operated by the vending machine operator that is being registered;
     Preferred mailing address (if different from the vending 
machine operator address), for purposes of receiving correspondence; 
and
     Certification that the information submitted is true and 
accurate, that the person or firm submitting it is authorized to do so, 
and that each registered vending machine will be subject to the 
requirements of Sec.  101.8.

[[Page 19242]]

    An authorized official of a vending machine operator who elects to 
be subject to the Federal requirements can register by visiting http://www.fda.gov/menulabeling. FDA has created a form that contains fields 
requesting the information in Sec.  101.8(d) and made the form 
available at this Web site. Registrants must use this form to ensure 
that complete information is submitted.

E. Requirements for Vending Machine Operators Subject to This Rule and 
Operators That Elect To Be Subject to the Rule When Calorie 
Declarations Are Required

Calorie Declaration for a Covered Vending Machine Food
    a. Calorie declaration. Section 403(q)(5)(H)(viii) of the FD&C Act 
provides that, for a covered vending machine food, the vending machine 
operator must ``provide a sign in close proximity to the article of 
food or the selection button that includes a clear and conspicuous 
statement disclosing the number of calories contained in the article.'' 
FDA is proposing in Sec.  101.8(c)(2)(i)(A) to require that for a 
covered vending machine food, the statement of the number of calories 
in the food must be expressed to the nearest 5-calorie increment up to 
and including 50 calories, and 10-calorie increment above 50 calories. 
For a covered vending machine food that has fewer than 5 calories, the 
calorie declaration may be expressed as zero. These rounding rules are 
consistent with the declaration of calories for packaged foods as 
provided in Sec.  101.9(c)(1).
    In addition, FDA tentatively concludes that the number of calories 
must be accompanied by a term, e.g., ``calories,'' to make clear what 
that number refers to. Consequently, FDA is proposing in Sec.  
101.8(c)(2)(i)(B) that the term ``Calories'' or ``Cal'' must appear 
adjacent to the number of calories for the covered vending machine 
food. This is the ``calorie declaration.'' We tentatively conclude that 
permitting the use of the abbreviation ``Cal'' will provide flexibility 
for vending machine operators, especially those that have limited space 
on their machines, in meeting the proposed requirements.
    Because section 403(q)(5)(H)(viii) of the FD&C Act refers to ``an 
article of food sold from a vending machine,'' FDA tentatively 
concludes that calorie information must include the total calories 
present in the covered vending machine food as it is vended. For 
example, if a covered vending machine food, such as a sandwich, is 
dispensed with a single serving unit of a condiment, such as 
mayonnaise, the calorie declaration must include the number of calories 
contained in the sandwich and the package of mayonnaise. FDA also 
tentatively concludes that the number of calories declared for the 
article of food must be identical to the number of calories that are 
declared in the Nutrition Facts, if present. If the food contains 
multiple servings and bears a Nutrition Facts Panel, FDA tentatively 
concludes that the number of calories declared must be equal to the 
total number of calories contained in the food item as dispensed. The 
total number of calories can be determined by multiplying the number of 
calories per serving by the number of servings in the package. For 
example, if the Nutrition Facts states 80 calories per serving and 3 
servings per container, the total number of calories in the entire 
package would be 240 calories. FDA tentatively concludes that for a 
covered vending machine food that contains multiple servings, a vending 
machine operator may voluntarily disclose calories per serving in 
addition to total calories for the food.
    Several comments requested that FDA permit the use of calorie 
ranges, similar to those provided for restaurants and similar retail 
food establishments under section 403(q)(5)(H)(v) of the FD&C Act, in 
declaring calorie information for covered vending machine foods that 
come in different flavors and varieties, e.g., coffee which comes in 
different flavors, brew strength, serving size, sweeteners or different 
types of sandwiches or fruit. The comments discussed the need for 
flexibility to provide calorie ranges for such items.
    FDA acknowledges that some articles of food sold from vending 
machines come in varieties, such as different flavors and types of hot 
beverages (e.g., coffee or hot chocolate). For some of these varieties, 
there could be a large range for calories. For example, calories for 
coffee could range from zero calories for a plain brewed coffee to over 
400 calories for a large mocha coffee with whole milk and whipped 
cream. We point out, however, that a vending machine operator could 
post a calorie declaration in close proximity to the selection button 
for a food that comes in different varieties and flavors that is sold 
in a vending machine that has selection buttons corresponding to the 
different options. For example, if there is a button to select cream 
for a coffee, a vending machine operator would be able to post a 
calorie declaration for that cream item in close proximity to the 
selection button. FDA has considered vending machines that typically 
dispense fresh sandwiches and fruit (often these machines are turnstile 
type). FDA believes that such machines do not present a unique 
situation where the proposed options for declaring calorie information 
would not be appropriate. FDA tentatively concludes, therefore, that 
calorie ranges are not necessary within the context of vending machines 
because a vending machine operator would be able to disclose calorie 
information under other options, as explained below (e.g., use of signs 
including posters).
    b. Determination of calorie content. If a covered vending machine 
food does not bear Nutrition Facts, FDA anticipates that the 
manufacturer or supplier of the food may provide the number of total 
calories for the food to the vending machine operator so that the 
operator has the necessary calorie information to meet the calorie 
disclosure requirements of section 403(q)(5)(H)(viii) of the FD&C Act. 
FDA notes that covered vending machine operators must ensure that the 
calorie declaration is truthful and not misleading in accordance with 
section 403(a)(1) of the FD&C Act. In the event the calorie information 
is not available from the manufacturer of the food, FDA seeks comments 
on whether a vending machine operator may use nutrient databases, 
cookbooks, laboratory analyses, and other reasonable means. FDA notes 
that such flexibility is provided in Sec.  101.10 and section 
403(q)(5)(H)(iv). Further, FDA seeks comment on whether vending machine 
operators should be required to provide FDA the information on which 
they relied to determine the total calories posted for the vending 
machine food.
    c. Placement and prominence of calorie declarations. Section 
403(q)(5)(H)(viii) of the FD&C Act provides that for a covered vending 
machine food, the vending machine operator must provide a sign in close 
proximity to the article of food or the selection button that includes 
a clear and conspicuous statement disclosing the number of calories 
contained in the food. FDA is interpreting the requirement that a sign 
be placed in close proximity to the article to mean that the sign is 
placed either in or on the vending machine itself or adjacent to the 
vending machine and near the food, its price, its selection number, or 
its selection button.
    Section 403(q)(5)(H)(viii) also requires that the calorie 
declaration be clear and conspicuous. FDA notes that to be clear and 
conspicuous the calorie declaration must be in a font size large enough 
to be seen and easily readable. However, FDA recognizes that vending 
machines come in a variety of sizes, shapes, and

[[Page 19243]]

styles. We also understand that vending machines will often have 
limited space. We think that it is important to provide businesses with 
flexibility while, at the same time, fulfilling the requirements of the 
statute. Therefore, we think it would not be appropriate to require one 
specific type size and font for calorie declarations for all covered 
vending machine food. Generally, if a calorie declaration is in a 
similar color as and a type size no smaller than the name \3\ of the 
food, price of the food, or the selection number (e.g., A9 or E4), 
consumers should be able to read the calories in the same manner as 
they read the name and price of the food item. Therefore, FDA is 
proposing in Sec.  101.8(c)(2)(i)(C) that if the calorie declaration is 
in or on the vending machine itself, the calorie declaration for a 
covered vending machine food must be in a type size no smaller than the 
name, selection number, or price of the food as displayed on the 
vending machine, whichever is smallest. In addition, to help ensure 
that the calorie declaration is clear and conspicuous, FDA is proposing 
in Sec.  101.8(c)(2)(i)(B) and Sec.  101.8(c)(2)(i)(C) that the calorie 
declaration be made in the same color, or in a color at least as 
conspicuous, as the color of the name, price, or selection number of 
the food. Further, FDA proposes that the calorie declaration on the 
machine must have the same contrasting background as the name or price 
or selection number it is in closest proximity to. FDA notes that if a 
calorie declaration is presented in a color that is not sufficiently 
contrasted with its background or the declaration is in a type size 
that is too small to be read by a prospective purchaser, FDA 
tentatively concludes that the calorie declaration for a covered 
vending machine food is not disclosed in a clear and conspicuous 
manner, and the declaration would not be in compliance with the 
requirements of section 403(q)(5)(H)(viii)(I). FDA requests comment on 
whether these requirements meet the conditions for ``clear and 
conspicuous'' or whether the requirements should be more or less 
prescriptive.
---------------------------------------------------------------------------

    \3\ Here the discussion of ``name'' refers to the name of the 
food on or in the vending machine and not the name of the food on 
the label of the food package.
---------------------------------------------------------------------------

    A number of comments suggested that calorie information be provided 
on a poster or sign near the machine, such as for a bank of several 
vending machines that may use a common singular payment acceptor. 
However, several comments noted a concern that calorie information 
would not be read by the consumer unless the calorie information were 
posted immediately next to each food item. The comments stated that 
``vending menus'' (such as a menu poster for a bank of vending 
machines) would not provide the buyer with easy access to the calorie 
information.
    FDA agrees with the comments that a sign that is a poster may be an 
appropriate medium to convey the required calorie declarations, so long 
as the sign is in close proximity to the covered vending machine food 
or selection button. The Agency tentatively concludes that ``close 
proximity'' could mean adjacent to the vending machine, but not 
necessarily attached, so long as the sign adjacent to the machine is 
clear and conspicuous at the same time as the food, its name, or its 
selection button or selection number is visible. The Agency requests 
comments on this tentative conclusion. FDA is also proposing in Sec.  
101.8(c)(2)(ii)(B) that if the sign required by section 
403(q)(5)(H)(viii) of the FD&C Act is placed adjacent to the vending 
machine, the calorie declaration must be in type that is all black or 
one color printed on a white or other neutral background that contrasts 
with the type color. The Agency is not proposing a minimum type size 
for the calorie declaration, but we request comment on this tentative 
decision. Comments should provide a rationale supporting their position 
and any supporting data, including consumer research. Where the vending 
machine only displays a vignette (i.e., picture of the food) or name of 
the food item, FDA is proposing in Sec.  101.8(c)(2)(ii)(D) that the 
calorie disclosure sign must be in close proximity to the vignette or 
name or in close proximity to the selection button.
    For electronic vending machines (e.g., machines with digital or 
electronic or liquid crystal display (LCD) displays), FDA tentatively 
concludes that the calorie disclosure sign required by the statute may 
be displayed when the selection numbers are entered but before the 
selection is confirmed, as proposed in Sec.  101.8(c)(2)(ii)(E).
    FDA tentatively concludes, that for certain types of vending 
machines with a limited number of selections, (e.g., popcorn with or 
without added butter), the sign with the statement of calories may 
appear anywhere on the front (or face) of the vending machine. A sign 
may consist of a handwritten sticker in permanent marking that is 
affixed to the machine, provided that the statement is prominent, not 
crowded by other labeling on the machine and in a type size reasonably 
related to the largest print on the vending machine.

F. When Calorie Declaration Is Not Required

1. Examination of the Nutrition Facts Panel
    If the Nutrition Facts Panel of an article of food sold from a 
vending machine may be examined by a prospective purchaser before 
purchasing the article, the vending machine operator is not required to 
provide the calorie information. FDA is interpreting the term 
``Nutrition Facts Panel'' to mean the nutrition information in the 
format required in Sec.  101.9(c) and (d) on the label of the food. FDA 
tentatively concludes in order for the Nutrition Facts Panel to be 
examined, it must be visible in full, without obstruction, before 
purchase. For example, a vending machine's automatic dispensing coil 
that holds the food in place or the placement of the package in the 
machine must not obscure, cover, or cause to be covered any portion of 
the Nutrition Facts Panel. To enable the prospective buyer to obtain 
the total number of calories of the article of food, the information 
that would be required to be made available on a sign by the vending 
machine operator if the provisions of section 403(q)(5)(H)(viii)(I)(aa) 
are not met, the agency notes that, in most cases, the prospective 
purchaser must use several parts of the panel to determine the total 
number of calories for the article of food. This is one reason that it 
is critical that no portion of the Nutrition Facts Panel be obscured.
    In addition, the Nutrition Facts Panel must be in a size that 
permits the prospective purchaser to easily read the nutrition 
information while the food is in the vending machine. FDA regulations 
allow certain foods to bear Nutrition Facts in a modified or smaller 
format based on the composition of the food, the size of the food 
package or other factors (see Sec.  101.9(d), (e), (f), (h) and (j)). 
Where the Nutrition Facts Panel is in a smaller format consistent with 
the regulations, a prospective purchaser is unlikely to be able to 
easily read it on the label of the article of food in the vending 
machine prior to purchase. In such cases, the Agency tentatively 
concludes that the prospective purchaser is not able to examine the 
Nutrition Facts Panel prior to purchase. FDA requests comment on these 
tentative conclusions.
    FDA recognizes that ordinarily the vending machine operator is not 
responsible for the printing of the Nutrition Facts Panel. Nor is the 
vending machine operator required by section 403(q)(5)(H)(viii)(I) to 
make examination of the Nutrition Facts

[[Page 19244]]

possible by the prospective purchaser prior to purchase. However, food 
manufacturers may have an incentive to work with vending machine 
operators to find ways to have their packaged food displayed with the 
Nutrition Facts easily readable in the vending machine. In this way, 
potential purchasers would have more information about the 
manufacturers' food than just calories.
2. Visible Nutrition Information at the Point of Purchase
    The second prong of section 403(q)(5)(H)(viii)(I)(aa) specifies 
that if a vending machine ``otherwise provide[s] visible nutrition 
information at the point of purchase'' for an article of food sold from 
the machine, the vending machine operator is not required to provide 
the calorie information. As with the Nutrition Facts Panel this 
alternative means of satisfying the requirement of section 
403(q)(5)(H)(viii) is optional for vending machine operators.
    The terms ``visible nutrition information'' and ``point of 
purchase'' in section 403(q)(5)(H)(viii)(I)(aa) are not defined in the 
statute. FDA sees two possible ways to understand and apply the terms. 
One approach is to conclude that (1) ``nutrition information'' in this 
context means total calories in the article of food, because this is 
the information that the vending machine operator must provide by sign 
if the provisions in section 403(q)(5)(H)(viii)(I)(aa) are not met; and 
(2) ``otherwise provide[d] * * * at the point of purchase'' suggests, 
in the context of the provision as a whole, that the information, like 
the Nutrition Facts Panel, should be on the article of food itself. FDA 
proposes this approach in proposed Sec.  101.8(b).
    FDA received several comments supporting the use of ``front of 
package'' nutrition information contained on the food label as a means 
of ``providing visible nutrition information at the point of 
purchase.'' For example, some packaged food manufacturers voluntarily 
place certain nutrition information on the principal display panel that 
includes calorie and other nutrition information about the product. 
This type of nutrition information is sometimes referred to as ``front 
of package'' by industry, whereas Nutrition Facts typically appear on 
the information panel of a food label. FDA tentatively concludes that 
``front of package'' nutrition information could be a way to provide 
visible nutrition information, so long as the criteria for color, font 
and type size are met and total calories in the article of food are 
included. If a nutrient content claim or a health claim for the article 
of food also is included on the front of the package, the claim must 
comply with relevant FDA regulations authorizing nutrient content 
claims (a claim on food labeling regarding the level of a nutrient, 
e.g., low fat) or health claims (a claim on food labeling regarding the 
relationship between a substance and a disease, e.g., calcium and 
osteoporosis), as applicable.
    FDA also received a few comments stating that the Nutrition Facts 
Panel and any ``front of package'' nutrition information may be small 
and difficult to read in a vending machine. FDA recognizes that a 
consumer may not be able to easily read some nutrition information in a 
vending machine and therefore this information may not inform the 
consumer about the number of total calories in the article of food. 
Section 101.8(b) of this proposed rule sets out the provisions 
regarding ``visible nutrition information at the point of purchase'' 
discussed above.
    Under proposed Sec.  101.8(b), for the nutrition information on the 
label to be considered ``visible,'' it must be clear and conspicuous. 
To ensure that it is clear and conspicuous, it must be both (1) in a 
type size easily readable from the distance between the prospective 
purchaser and the label and (2) in print with sufficient color and 
contrasting background to be readily distinguishable from other types 
of information on the label. FDA tentatively concludes that the visible 
nutrition information presented on the label of the food at the point 
of purchase must be in a type size reasonably related to the most 
prominent printed matter on the label and in a color that sufficiently 
contrasts with the background, such that a prospective purchaser is 
able to notice and read the information. Generally, FDA has considered 
``reasonably related'' to mean a type size that is at least 50 percent 
of the size of the largest print on the label. (Ref. 2).
    The alternative approach is to interpret the words ``otherwise 
provide visible nutrition information at the point of purchase'' by 
concluding that (1) ``nutrition information'' means something more than 
total calories, and (2) ``point of purchase'' means something more than 
on the package of the food itself. Under this interpretation, the non-
Nutrition Facts Panel option in the statute would include information 
in addition to total calories because the broader term ``nutrition 
information'' was used instead of ``calories.'' Just as the Nutrition 
Facts Panel contains more than calorie information, so too, would 
``visible nutrition information at the point of purchase.'' This could 
include, in addition to total calories in the food, information such as 
serving size information or information on the nutrients that are 
required to be disclosed in the Nutrition Facts as described in Sec.  
101.9 or 21 U.S.C. 343(q)(1)(D) and (E). FDA seeks comment on what 
other nutrition information, if any, should be required if this 
alternative interpretation were adopted. FDA also notes that under this 
alternative interpretation, the vending machine operator could rely on 
any ``visible nutrition information at the point of purchase'' that 
included total calories in addition to other nutrition information 
regardless of what entity supplied the information.
    Likewise, under the alternative approach, ``point of purchase'' 
would be read to mean that the ``visible nutrition information'' could 
be provided in places other than on the package of the food in the 
vending machine, such as on the vending machine itself.
    In the case of the alternative interpretation, in which the 
``visible nutrition information at the point of purchase'' appears 
other than on the label of the article of food, there are also the 
questions of where and through what means the information may be 
provided. The agency specifically requests comment on whether, under 
this alternative interpretation, signs (including posters) or booklets 
would be sufficient in providing ``otherwise visible nutrition 
information at the point of purchase'' and we especially request any 
consumer studies or social scientific data on this issue.
    Regardless of the precise location or means of providing the 
nutrition information, under the alternative interpretation there would 
also be a question of ensuring that the information is adequately 
``visible.'' At a minimum, the nutrition information should be clear 
and conspicuous and noticeable at the point of purchase, in the context 
of the surroundings. One way to ensure this visibility if the nutrition 
information is not on the label of the article of food would be to 
provide the information in type that is all black or one color, printed 
on a white or other neutral background that contrasts with the type 
color. Another way would be to also provide the information using a 
minimum type size. The agency requests comments on these and other ways 
to determine if the information is ``visible.''
    Another aspect of whether information that is not on the food 
itself is visible to the consumer is where the information is placed 
relative to the ``point of purchase.'' FDA requests comment on the 
meaning of ``the point of purchase'' in this context and on all

[[Page 19245]]

aspects of the alternative interpretation of ``visible nutrition 
information at the point of purchase.''
    FDA seeks comment on the alternative approaches to interpreting and 
applying ``otherwise provide visible nutrition information at the point 
of purchase.''

G. Conforming Amendment

    FDA is proposing to exempt electronic signatures submitted to 
satisfy the requirements of this proposed section from the requirement 
to comply with Part 11--Electronic Records; Electronic Signatures (21 
CFR part 11) and proposing to amend part 11 to reflect this exemption. 
We expect this exemption to facilitate the registration process for 
those vending machine operators who voluntarily choose to register 
under section 403(q)(5)(H)(ix) of the FD&C Act.

H. Effective Date

    FDA received a few comments regarding the effective date of the 
final rule that would issue based on this proposal. These comments 
suggested that vending machine operators would need 2 years to 
implement the requirements for calorie labeling for vending machines 
due to the costs of producing posters and driving to each site to post 
the information.
    FDA is proposing that the final rule become effective one year from 
the date of its publication. Because FDA is proposing flexibility for 
compliance, i.e., the use of signs in, on, or adjacent to vending 
machines, vending machine operators would be able to choose among a 
wide variety of less expensive avenues to achieve compliance, depending 
on their situation. Many foods sold from vending machines are packaged 
and have Nutrition Facts. Therefore, vending machine operators have the 
opportunity of orienting the food in the vending machine such that the 
prospective customer may examine the Nutrition Facts Panel. In this 
case, the operators would not need to provide calorie information 
required by 403(q)(5)(H)(viii)(I) of the FD&C Act. If the operator 
chooses not to orient the food such that the prospective customer may 
examine the Nutrition Facts Panel, or if it is not practicable to do so 
because the vending machine is not of the type where the food is 
visible, the operator may obtain the calorie information from the 
Nutrition Facts to place on the signs. Further, the proposed rule, if 
finalized, does not require any particular manner of obtaining calorie 
information. As discussed above in this document, FDA anticipates that, 
if a covered vending machine food does not bear Nutrition Facts because 
it falls under an exemption, the manufacturer or supplier of the food 
may provide the number of total calories for the food to the vending 
machine operator so that the operator has the necessary calorie 
information to meet the calorie disclosure requirements of section 
403(q)(5)(H)(viii)(I). Because of the flexibility provided in this 
proposed rule, the Agency finds that it is reasonable to make the 
requirements effective in 1 year. Based on the comments and on what 
vending machine operators will need to do to come into compliance, the 
Agency tentatively finds that making the final rule effective 1 year 
after publication is practicable. The Agency seeks comment on the 
appropriateness of this timeframe.

IV. Summary Preliminary Regulatory Impact Analysis

    The summary analysis of benefits and costs included in this 
document is drawn from the detailed Preliminary Regulatory Impact 
Analysis which is available at http://www.regulations.gov, Docket No. 
FDA-2011-F-0171, and is also available on FDA's Web site at http://www.fda.gov/Food/LabelingNutrition/ucm217762.htm.

A. Introduction

    FDA has examined the impacts of the proposed rule under Executive 
Orders 13563 and 12866, the Regulatory Flexibility Act (5 U.S.C. 601-
612), and the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4). 
Executive Orders 13563 and 12866 direct agencies to assess all costs 
and benefits of available regulatory alternatives and, if regulation is 
necessary, to select regulatory approaches that maximize net benefits 
(including potential economic, environmental, public health and safety 
effects, distributive impacts, and equity). Executive Order 13563 
emphasizes the importance of quantifying both costs and benefits, of 
reducing costs, of harmonizing rules, and of promoting flexibility. 
This proposed rule has been designated an ``economically'' significant 
rule, under section 3(f)(1) of Executive Order 12866. Accordingly, the 
proposed rule has been reviewed by the Office of Management and Budget 
(OMB).
    The Regulatory Flexibility Act requires agencies to analyze 
regulatory options that would minimize any significant impact of a rule 
on small entities. Using the Small Business Administration (SBA) 
definition of small vending machine operators as classified by the 
North American Industry Classification System (NAICS 45421), FDA 
estimates that a significant number of operators impacted by this 
proposed rule are small businesses. As directed by statute, the 
requirements of the proposed rule only apply to vending machine 
operators that own or operate 20 or more vending machines. However, 
according to data from the Vending Times Census and from the National 
Automatic Merchandising Association (NAMA), the average annual revenue 
per machine is less than $7,000 (Refs. 3 and 4). An operator with only 
20 machines may have vending machine revenue of less than $140,000. In 
order to exceed the SBA's definition of a small vending machine 
operator, a firm would need at least $10 million in annual revenue 
(Ref. 5). This suggests that a firm with revenue exclusively from 
vending machine sales would need more than 1,400 machines to exceed the 
definition of small business. Based on the latest available U.S. 
Economic Census data that breaks down establishments by revenue, we 
project that 97 percent of firms selling covered vending machine food, 
as that term is used in this document, that identify primarily as 
vending machine operators that are engaged in the business of owning or 
operating 20 or more vending machines would be small businesses as 
defined by SBA. Therefore, the Agency believes that the proposed rule 
would have a significant economic impact on a substantial number of 
small entities. This impact is discussed further in section V of this 
document.
    Section 202(a) of the Unfunded Mandates Reform Act of 1995 requires 
that agencies prepare a written statement, which includes an assessment 
of anticipated costs and benefits, before proposing ``any rule that 
includes any Federal mandate that may result in the expenditure by 
State, local, and tribal governments, in the aggregate, or by the 
private sector, of $100,000,000 or more (adjusted annually for 
inflation) in any one year.'' The current threshold after adjustment 
for inflation is $135 million, using the most current (2009) Implicit 
Price Deflator for the Gross Domestic Product. FDA does not expect this 
proposed rule to result in any 1-year expenditure that would meet or 
exceed this amount.

B. Need for This Regulation

    This proposed rule is necessary to implement section 4205 of the 
Affordable Care Act, which principally amends sections 403 and 403A of 
the FD&C Act, and requires operators of 20 or more vending machines to 
disclose calorie information for covered vending machine food. The 
provision of calorie information for covered vending

[[Page 19246]]

machine food may help consumers make better informed dietary choices.
    Economic justifications for regulatory interventions in private 
markets rely on the presence of some market failure. In the case of 
food sold from a vending machine, the private market is particularly 
robust and competitive. Thousands of individual firms vie for consumer 
dollars in millions of vending machines across the United States (Ref. 
3). Low entry costs for firms and low switching costs for customers 
suggest that if a sizable fraction of consumers were willing to pay 
for--and discriminate based on--the visible calorie information at the 
point of purchase then the industry would provide it to them. In fact, 
some vending machine operators are voluntarily providing more healthful 
choices and additional information on machines (Refs. 4 and 6).
    Although many of the usual market failures that justify regulatory 
action, such as the existence of market power or of ill-defined 
property rights, do not apply here (Refs. 7 and 8), the primary support 
for regulatory intervention is that there are systematic biases in how 
consumers process information and weigh current benefits (from 
consuming higher calorie foods) against future costs (higher 
probability of obesity and its comorbidities).
    The bias is more directly related to the requirements of this 
proposed rule: Consumer demand for calorie information does not create 
incentives for the provision of calorie information at the vending 
machine. This market failure occurs because at the time of purchase, 
consumers do not value calorie information as much as they do later, 
when the effects of excess calorie consumption are evident. Studies 
have shown that consumers have present-based preferences, meaning that 
they are continually optimistic about the healthfulness of their future 
choices (Ref. 9, 10 and 11).
    These studies suggest that calorie information often lacks 
salience, or relevance, for consumers at the time of purchase and 
consumption, even though they may experience regret about their 
decisions at a later date. This tendency may explain why consumers have 
not generally demanded calorie and other nutrition information for food 
sold from vending machines before, or at, the point of purchase, even 
if they may, at a later point in time, value that information. Because 
of competition for consumer time and attention vending machine 
operators have limited time and space in which to convey information to 
consumers. These limits mean that there is a substantial opportunity 
cost to the operator of providing calorie information. That is, just as 
an operator may have to decide which possible foods to leave out of a 
vending machine with limited space (thus giving up the opportunity to 
sell those items), it must choose which pieces of information about its 
foods it wants to convey. Adding an additional piece of information 
means that an operator may need to downplay or remove some other piece 
of information. This opportunity cost of information holds true whether 
the calorie information is displayed on the machine or, as with an 
increasing number of packaged foods, on the principal display panel of 
the package.
    The proposed requirements mitigate the apparent market failure in 
information provision stemming from present-biased preferences, 
although not necessarily the tendency of consumers to underutilize that 
information. Specifically, for a covered vending machine food, this 
proposed rule requires that the vending machine operator provide a sign 
in close proximity to the food or the selection button, i.e. in, on, or 
adjacent to the vending machine, but not necessarily attached to the 
vending machine, so long as the sign is visible at the same time as the 
food, its name, price, or selection number. This information must be 
presented in a color that is sufficiently contrasted with the 
background, must be in close proximity to the vignette or name or in 
close proximity to the selection button when a name or vignette is 
displayed, and, for electronic vending machines, the calorie 
information may be displayed when the selection numbers are entered but 
before the selection is confirmed. These requirements are designed so 
that the calorie information is made available to consumers before they 
purchase such food. Providing the information will likely increase 
consumer awareness regarding the calorie content in covered vending 
machine food and increase the perceived relevance of that information 
to their decision making. Providing the information may serve to 
highlight the potential future costs of additional calorie consumption. 
This increased attention to the caloric content of covered vending 
machine food may then result in an increased availability of lower 
calorie options, and an increased demand for these options.

C. Summary of Costs and Benefits of the Proposed Requirements and 
Regulatory Options

    In this section FDA describes the bases of benefits and costs of 
the proposed requirements and summarizes the results of the detailed 
Preliminary Regulatory Impact Analysis (PRIA).
    Benefits in response to the proposed requirements Obesity is a 
major public health concern in the United States and one of the top 
leading health indicators addressed by the United States Healthy People 
2020 goals. Nationally representative data indicate an increase in the 
prevalence of obesity over the past three decades (Ref. 12). The 2007-
2008 National Health and Nutrition Examination Survey (NHANES) data 
showed that 34 percent of the adult U.S. population is obese and 34 
percent are overweight (Ref. 13).
    Excess body weight has many health (Ref. 14), social (Refs. 15 and 
16), psychological (Refs. 17 and 18), and economic consequences (Ref. 
19) for the affected individuals. Lower life expectancy, elevated risk 
of diabetes, hypertension, stroke and other cardiovascular diseases 
have been documented to rise simultaneously with the increased 
prevalence of obesity (Ref. 14). The economic impact is especially 
evident in health-care costs in terms of greater health-care 
utilization and higher medical expenditures (Ref. 20). More 
specifically, medical expenditures attributable to overweight and 
obesity accounted for more than 9 percent of the total U.S. medical 
expenditures in 1998, or between $85.7 billion and $147 billion (Ref. 
20). Researchers have proposed various factors to explain this dramatic 
rise in obesity including declining food prices and physical 
requirements of labor (Refs. 21 and 22), declining time costs of food 
preparation (Ref. 23), fast-food restaurant density (Ref. 24) and 
social interactions (Refs. 25).
    Although the relationship between obesity and poor dietary choices 
is multi-faceted, there is a general agreement in the literature that 
reduction in excess calories is helpful in preventing or delaying the 
onset of excess weight gain (Ref. 26). Vending machines are a likely 
source of high-calorie snack or discretionary foods, as well as some 
high-calorie meal items. Industry data indicate that there is 
approximately one vending machine for every 40 adults in the United 
States, and that up to 5 percent of the money consumers spend on food 
away from home is spent on vending machine food (Ref. 27). This 
suggests that providing calorie information for covered vending machine 
food to consumers may have a significant effect on calorie intake, the 
prevalence of obesity, and thus the cost of health care and lost 
productivity.
    To the extent that the proposed requirements mitigate the increase 
in the prevalence of obesity and the

[[Page 19247]]

prevalence of these costly co-morbidities such as hypertension and 
diabetes, society gains the opportunity cost of the averted medical 
expenditures and an increase in productivity from averted debilitation 
and death. In addition to educating consumers about calorie content, 
major predicted elements of the consumer and industry response to this 
proposed rule are:
    1. Increased awareness regarding the caloric content in covered 
vending machine foods, and the perceived relevance of that information 
to decision making, which may help reduce the present-bias in 
preferences, and thus encourage the consumption of lower calorie 
options.
    2. Increased consumer interest in lower calorie options, and 
greater transparency in the caloric content of foods sold in vending 
machines, which may give manufacturers an incentive to:
    a. Reduce the calorie content of foods sold in vending machines 
through reformulation or by decreasing portion size.
    b. Provide additional items with lower calorie formulations.
    These changes may reduce consumers' caloric intake from food sold 
in vending machines. Note that any reduction in calorie intake in these 
settings may be at least partially offset by increases in calorie 
intake during other meals or snacks. Because FDA lacks data on how 
consumers will substitute among caloric sources, the benefit 
estimations given here may be higher or lower than those that will be 
realized if the rule is finalized as proposed.
    Coverage of the proposed rule and industry overview. The proposed 
rule covers certain vending machine operators that are engaged in the 
business of owning or operating 20 or more vending machines and those 
vending machine operators that voluntarily register with FDA to become 
subject to the Federal requirements. The proposed rule does not cover 
vending machines without a selection button, including bulk vending 
machines that dispense gum, candy and nuts. Vending machines are 
operated both by food service firms and by firms in other businesses 
that operate machines for the benefit of their customers or employees 
and do not identify as vending machine operators. Because this latter 
group cannot be accurately counted, published estimates of the number 
of vending machine operators will generally undercount the number of 
covered operators under the proposed rule. For the purposes of this 
preliminary regulatory impact analysis, we will use the term ``covered 
operators'' or ``covered vending machines'' to refer to operators or 
machines that sell covered vending machine foods. According to the 
NAMA, there are approximately 13,500 companies that operate vending 
machines in the United States (Ref. 4). Other estimates put the total 
closer to 10,000 (Ref. 3). This total includes 5,000 firms whose 
primary business identification is as vending machine operators (NAICS 
4542), plus a variety of other firms that operate vending machines, but 
do not primarily identify as such. These other companies include, for 
example, beverage manufacturers and food service contractors. Because 
of the difficulty in determining which firms are covered, and because 
FDA has no data on the potentially significant number of covered 
vending machine operators that self-identify as businesses outside the 
food industry, we take NAMA's higher estimate of 13,500 firms as the 
number of covered firms.
    FDA estimates that 97 percent of firms selling covered vending 
machine food that identify primarily as vending machine operators that 
are engaged in the business of owning or operating 20 or more vending 
machines are small businesses as defined by the SBA. Other estimates 
indicate that more than 90 percent of the firms covered by the proposed 
rule are defined as small businesses (Ref. 3). This percentage may be 
lower for firms that have primary business identification other than as 
vending machine operators, but the majority of covered businesses will 
likely still be defined as small businesses. Because very small, 
informal businesses that are not captured by economic census data might 
operate 20 or more machines, these figures may underestimate the number 
of affected small businesses. Conversely, approximately 72 percent of 
industry revenue--and thus a comparably large fraction of consumption--
comes from firms with more than $10 million in annual sales, and 85 
percent comes from firms with more than $5 million in revenue (Ref. 3).
    Vending machine operators together operate an estimated 5 to 7 
million machines (Refs. 3 and 4) in at least 1.5 million locations 
(Ref. 3). Approximately 70 percent of these machines sell packaged 
food, including beverages, that are required to bear nutrition labeling 
under section 403(q)(1) of the FD&C Act and FDA regulations at Sec.  
101.9, and thus have Nutrition Facts. This 70 percent is comprised 
mostly of packaged beverage machines, which account for more than 50 
percent of all vending machines, with the remainder--approximately 20 
percent of all machines--selling packaged confections or snacks. Ten 
percent sell a variety of hot and cold cup beverages, frozen or fresh 
food products and miscellaneous other food products. The final 20 
percent of machines are bulk candy, nut or gum machines that are not 
covered by section 403(q)(5)(H)(viii) and the proposed requirements 
because they lack selection buttons. While these bulk machines form a 
large percentage of vending machines, they account for less than 0.5 
percent of vending machine sales (Ref. 4).
    Summary of costs and benefits of the proposed rule and regulatory 
options In this section we briefly summarize the costs and benefits of 
the proposed rule that are analyzed in the detailed PRIA. These 
estimates are collected in table 1. Costs of complying with the 
proposed requirements have been estimated for three major areas: Cost 
of nutrition analysis, cost of new signs, including posters, and labor 
costs. In the case of the proposed rule, FDA estimates that there would 
be approximately 10,800 operators under the proposed requirements, 
controlling between 4 million and 5.6 million machines that sell 
covered vending machine foods. The initial mean estimated cost of 
complying with the proposed requirements is $25.8 million, with an 
estimated mean ongoing cost of $24.0 million. Mean annualized costs are 
$24.5 million at a 7 percent discount rate, and $24.2 million at 3 
percent discount rate. Per operator costs are estimated to be $2,400. 
FDA estimates that average per machine costs are less than $10 
annually.
    FDA has not estimated the actual benefits associated with proposed 
requirements. Food choice and consumption decisions are complex and FDA 
is unaware of any comprehensive data allowing accurate predictions of 
the effect of the proposed requirements on consumer choice and vended 
foods. Therefore, FDA has constructed a plausible individual effect of 
the proposed rule, and has conducted a break-even analysis in order to 
determine the proportion of the U.S. obese adult population that would 
need to attain this minimal response in order for the proposed 
requirement to yield a positive net benefit. Using a 100 calorie per 
week reduction in intake as the benchmark effect, FDA estimates that at 
least 0.02 percent of the adult obese population would need to reach 
this benchmark in order for the rule to break even on the initial total 
cost. On an ongoing basis, again, at least 0.02 percent of the adult 
obese population would need to reach this benchmark in

[[Page 19248]]

order for the rule to break even on the recurring annual costs. These 
effects are summarized in table 1 of this document.
    Finally, although registration by firms wishing to register with 
FDA in order to come under the proposed requirements and the associated 
preemption from State or local regulations is voluntary, and will only 
occur to the extent that the costs of registration and compliance with 
Federal regulation is lower than that of State or local laws, this 
registration constitutes a collection of information under the 
Paperwork Reduction Act of 1995. Therefore, FDA has also estimated the 
burden associated with this collection of information in the detailed 
analysis.

    Table 1--Accounting Statement: Annualized Cost and Break-Even Benefit Point for the Proposed Requirements
----------------------------------------------------------------------------------------------------------------
                                      Primary        Low          High         Year       Discount      Period
                                      estimate     estimate     estimate      dollar        rate       covered
----------------------------------------------------------------------------------------------------------------
Benefits
----------------------------------------------------------------------------------------------------------------
Annualized Monetized ($millions/
 year)............................                                 Not Quantified
-----------------------------------
Annualized Quantified:
----------------------------------------------------------------------------------------------------------------
Qualitative: FDA estimates that at least 0.02 percent of the adult obese population would need to reduce caloric
 intake by at least 100 calories per week in order for benefits from the proposed requirements to reach a break
 even point on annualized costs (at either 3% or 7%)
----------------------------------------------------------------------------------------------------------------
Costs
----------------------------------------------------------------------------------------------------------------
Annualized Monetized ($millions/          $24.5        $12.5        $39.8         2009           7%           10
 year)............................
                                           24.2         12.1         39.6         2009           3%           10
----------------------------------------------------------------------------------------------------------------

    Regulatory Options In addition to a baseline, FDA has identified 
four regulatory options for this proposed rule. The costs and benefits 
of these options are summarized in table 2 of this document.
    (0) Baseline for the purpose of analysis--No new Federal regulatory 
action.
    (1) Option 1, the proposed rule, allowing a sign in close proximity 
to the article of food or selection button, i.e. in, on, or adjacent to 
the vending machine, but not necessarily attached to the vending 
machine, so long as the sign is visible at the same time as the food, 
its name, price, or selection number, and with an effective date of 1 
year after publication of the final rule.
    (2) Option 2, similar to the proposed rule, but requiring that 
calorie declarations be immediately adjacent to the article of food or 
selection button for all calorie disclosures. For this option, FDA 
estimates the cost of individual signs for each article of food or 
selection button.
    (3) Option 3, Similar to the proposed rule, but with an additional 
year in compliance period for vendors with less than $500,000 in annual 
revenue from vending machines.
    (4) Option 4, similar to the proposed rule, but with coverage 
extended to bulk vending machines without selection buttons.

                                        Table 2--Summary of Estimated Annualized Compliance Costs for Each Option
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                           Proportional
                                                                                                                           Proportional    dollar sales
                                                                                                              Percent      cost relative   of restaurant
                                                              Primary      Low estimate    High estimate   discount rate    to primary     food relative
                   Summary of options                      estimate  (in   (in millions)   (in millions)     (10 year       estimate of     to primary
                                                             millions)                                       horizon)      the proposed     estimate of
                                                                                                                           requirements    the proposed
                                                                                                                                           requirements
--------------------------------------------------------------------------------------------------------------------------------------------------------
(Baseline)..............................................             N/A             N/A             N/A             N/A             N/A
Option 1: the Proposed Rule.............................           $24.2           $12.1           $39.6              3%            0.0%            0.0%
                                                                    24.5            12.5            39.8              7%
Option 2: Individual Signs..............................            81.8            36.1           140.4              3%         +229.2%            0.0%
                                                                    82.5            36.6           141.1              7%
Option 3: Longer Compliance Time for Small Businesses...            24.2            12.1            39.6              3%            0.0%            0.0%
                                                                    24.5            12.5            39.8              7%
Option 4: Extended Scope to Include Bulk Machines.......            30.2            15.1            49.4              3%          +25.6%           +0.5%
                                                                    31.0            15.8            50.3              7%
--------------------------------------------------------------------------------------------------------------------------------------------------------

    FDA estimates that Option 2, which would require individual signs 
or labels for each covered vended food, has a ten-year annualized costs 
of between $36.1 million per year and $140.4 million per year at a 3 
percent discount rate, with a primary estimate of $81.8 million. 
Averaged over primary, low and high estimates, the costs of Option 2 
are 229.2 percent higher than those of the proposed requirements. These 
changes are discussed more fully in the detailed analysis.
    Option 3 which considers a longer compliance time for small 
businesses represents only a delay in the costs. This delay has a small 
positive impact on the annualized cost, but one that does not change 
the (rounded) estimate of costs for Option 3 from the estimate,

[[Page 19249]]

of costs for Option 1. Option 4, expands the scope of the requirements 
to include foods in bulk vending machines without selection buttons, 
has costs that are 25.6 percent higher than the proposed option, and 
covers an additional 0.5 percent of sales of vended foods.
    For full documentation and discussion of these estimated costs and 
benefits see the detailed Preliminary Regulatory Impact Analysis, 
available at http://www.regulations.gov, Docket No. FDA-2011-F-0171, 
and is also available on FDA's Web site at http://www.fda.gov/Food/LabelingNutrition/ucm217762.htm.

V. Initial Regulatory Flexibility Analysis

    FDA has examined the economic implications of this proposed rule as 
required by the Regulatory Flexibility Act (5 U.S.C. 601-612). If a 
rule has a significant economic impact on a substantial number of small 
entities, the Regulatory Flexibility Act requires agencies to analyze 
regulatory options that would lessen the economic effect of the rule on 
small entities consistent with statutory objectives. FDA tentatively 
concludes that this proposed rule will have a significant economic 
impact on a substantial number of small entities.
    However, FDA has built flexibility into the proposed rule. The 
proposed rule does not mandate a particular method for determining 
calorie disclosure; instead, the proposed rule provides options for how 
vending machine operators can determine calorie information for covered 
vending machine food. Further, the proposed rule does not prescribe the 
materials that may be used by vending machine operators in disclosing 
calorie information; instead, the proposed rule provides options for 
how vending machine operators can disclose calorie information for 
covered vending machine food. Therefore, vending machine operators may 
choose among a wide variety of less, or more, expensive avenues to 
achieve compliance, depending on their situation. Because no particular 
method for compliance is mandated, the proposed rule gives small 
businesses the leeway to use cheaper solutions that meet the 
requirements of the proposed rule (e.g., stickers).
    A general way to add flexibility for small firms during a 
rulemaking is to lengthen the time for these firms to comply with the 
rule. An example of a delayed compliance time for small businesses 
applied to this proposed rule is the option for vendors with less than 
$500,000 in annual revenue from vending machine food sales to have an 
additional year to comply. Generally, FDA uses the SBA's definition of 
``small business'' as it applies to the relevant economic sector, in 
this case, NAICS 4542. However, as noted in the detailed Preliminary 
Regulatory Impact Analysis, available at http://www.regulations.gov, 
Docket No. FDA-2011-F-0171, and is also available on FDA's Web site at 
http://www.fda.gov/Food/LabelingNutrition/ucm217762.htm, SBA defines a 
small vending machine operator as one with annual revenue less than $10 
million, and this definition would cover at least 97 percent of the 
industry. Adding flexibility--such as a longer time to come into 
compliance--specifically for small firms would mean that most vending 
machine operators would be given that added flexibility. Therefore FDA 
has taken the approach of building substantial flexibility into the 
proposed rule for most vending machine operators in order to give the 
entire industry the opportunity to comply in the most cost-effective 
way.

VI. Paperwork Reduction Act

    This proposed rule contains information collection provisions that 
are subject to review by the Office of Management and Budget (OMB) 
under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). A 
description of these provisions is given in the following paragraphs 
with an estimate of the annual reporting and recordkeeping burden. 
Included in the estimate is the time for reviewing instructions, 
searching existing data sources, gathering and maintaining the data 
needed, and completing and reviewing each collection of information.
    The information collection provisions for all provisions of this 
proposed rule have been submitted to OMB for review as revisions of 
collections approved under OMB control numbers 0910-0664 and 0910-0665. 
Interested persons are requested to fax comments regarding information 
collection by May 6, 2011, to the Office of Information and Regulatory 
Affairs, OMB. To ensure that comments on information collection are 
received, OMB recommends that written comments be faxed to the Office 
of Information and Regulatory Affairs, OMB, Attn: FDA Desk Officer, 
FAX: 202-395-5806.
    FDA invites comments on: (1) Whether the proposed collection of 
information is necessary for the proper performance of FDA's functions, 
including whether the information will have practical utility; (2) the 
accuracy of FDA's estimate of the burden of the proposed collection of 
information, including the validity of the methodology and assumptions 
used; (3) ways to enhance the quality, utility, and clarity of the 
information to be collected; and (4) ways to minimize the burden of the 
collection of information on respondents, including through the use of 
automated collection techniques, when appropriate, and other forms of 
information technology.

Vending Machine Labeling: Recordkeeping and Mandatory Third Party 
Disclosure Under Section 4205 of the Patient Protection and Affordable 
Care Act of 2010--(OMB Control Number 0910-0665)--Revision

    Section 4205 of the Affordable Care Act, which amends sections 
403(q)(5) and 403A of the FD&C Act, requires disclosure of calorie and 
other nutrition information by restaurants and vending machine 
operators. Section 4205 became effective on the date the law was 
signed, March 23, 2010. Restaurants and vending machine operators not 
subject to the requirements of section 403(q)(5)(H) may elect to become 
subject to the requirements of section 403(q)(5)(H) by registering 
biannually with FDA. Section 4205 required FDA to publish a notice in 
the Federal Register within 120 days of the date of enactment of 
section 4205, providing information on the terms and conditions for 
persons who voluntarily elect to be subject to nutrition disclosure 
requirements specified in the law.

A. Statutory Compliance

    To comply with the PRA and with the statutory deadline under the 
provisions of section 4205 for publication of registration information, 
FDA initially obtained a 6-month OMB approval of the collection of 
information requirements under the emergency processing provisions of 
the PRA. With OMB approval of the collection of information 
requirements of section 4205, FDA took several actions: (1) Developed 
an electronic form, ``Menu And Vending Machine Labeling Voluntary 
Registration,'' Form FDA 3757, (2) as required by section 4205, 
published a notice in the Federal Register of July 23, 2010 (75 FR 
43182) (the July 23, 2010, notice) to explain how retail food 
establishments and vending machine operators not otherwise subject to 
the provisions of section 4205 may voluntarily elect to become subject 
to them, and (3) developed and implemented the guidance entitled, 
``Guidance for Industry: Questions and Answers Regarding the Effect of 
Section 4205 of the Patient Protection and Affordable Care Act of 2010 
on State and Local Menu and Vending Machine Labeling

[[Page 19250]]

Laws.'' This guidance among other things clarified section 4205's 
effect on State and local menu and vending machine labeling laws, to 
ensure that industry and State and local government understood the 
immediate effects of the law. FDA's current thinking on the preemptive 
effects of section 4205 is set out in the Federalism sections of the 
preamble to the proposed rule implementing menu labeling and this 
proposed rule.
    FDA has requested a 3-year approval of the information collection 
requirements under the same assigned OMB Control Nos. 0910-0664 and 
0910-0665. In the Federal Register of January 31, 2011, FDA published 
two notices announcing the submission to OMB of the information 
collection requests for No. 0910-0664 (76 FR 5384) and No. 0910-0665 
(76 FR 5380). Elsewhere in this Federal Register, FDA published a 
proposed rule entitled ``Food Labeling; Nutrition labeling of standard 
menu items in restaurants and similar retail food establishments'' (the 
Menu Labeling proposed rule). As noted, the information collection 
requests previously submitted sought OMB approval of the reporting, 
recordkeeping, and third party disclosure burdens of section 4205, not 
the provisions of the Menu Labeling proposed rule. With that proposed 
rule, FDA submitted a revised information collection request seeking 
OMB approval of the changes caused by the Menu Labeling proposed rule 
to the collections approved under OMB Control Nos. 0910-0664 and 0910-
0665. This proposed rule seeks further revision of those information 
collections with regard to the recordkeeping and third party disclosure 
burdens for vending machine operators caused by this proposed rule.

B. Revision of OMB Control No. 0910-0665 by the Proposed Rule

    These estimated annual recordkeeping burdens have changed from the 
burdens estimated for the OMB control number 0910-0665 30 day notice 
(76 FR 5380, January 31, 2011). Total initial hours have risen by 1,920 
due to an increase in the estimated number of recordkeepers from 600 to 
915 and an increase in the number of hours per record from 2 hours to 4 
hours. The estimated burden of recurring hours increased by 8 hours to 
128 hours. This estimate of third party disclosure hours has decreased 
by approximately 13.2 million hours, from the 14 million hours estimate 
given in the 30-day notice.

C. Consolidation of OMB Control No. 0910-0664 Under 0910-0665

    The Menu Labeling proposed rule contains a revision request in 
which the burden hours for the information collection request under OMB 
control number 0910-0664, ``Restaurant Menu and Vending Machine 
Labeling: Registration for Small Chains Under Section 4205 of the 
Patient Protection and Affordable Care Act of 2010'' are being 
consolidated under the information collection request assigned OMB 
control number 0910-0665,''Restaurant Menu and Vending Machine 
Labeling: Recordkeeping and Mandatory Third Party Disclosure Under 
Section 4205 of the Patient Protection and Affordable Care Act of 
2010.'' In addition, this proposed rule is a revision request in which 
these two information collection requests will be further revised with 
regard to the estimated burden of the proposed rule on vending machine 
operators. The revised information collection request for 0910-0665 
will be renamed ``Restaurant Menu and Vending Machine Labeling: 
Registration, Recordkeeping and Mandatory Third Party Disclosure Under 
Section 4205 of the Patient Protection and Affordable Care Act of 
2010.'' Upon approval of this revision request, the information 
collection request for OMB control number 0910-0664 will be 
discontinued.

D. Analysis of Changes in Burden Estimates Caused by the Proposed Rule

    Description of Respondents: The likely respondents to this 
information collection are operators of 20 or more vending machines. 
The following analysis provides FDA's estimate of the changes caused by 
this proposed rule to the previously approved recordkeeping and third 
party disclosure burdens for vending machine operators. The analysis of 
burden included in this document is drawn from the detailed Preliminary 
Regulatory Impact Analysis which is available at http://www.regulations.gov, Docket No. FDA-2011-F-0171, and is also available 
on FDA's Web site at http://www.fda.gov/Food/LabelingNutrition/ucm217762.htm.
    Most food sold from vending machines is subject to nutrition 
labeling requirements under section 403(q) of the FD&C Act and Sec.  
101.9, which means that calorie content is already collected. A likely 
scenario in response to vending machine labeling is that food 
manufacturers will include a set of calorie label stickers in each case 
of product. This would be efficient both because most manufacturers 
will already have the calorie information available, and because 
economies of scale exist for the manufacturer. In this case, vending 
machine operators will not need to keep a record of calorie content. 
Instead, the burden for most operators will be limited to that of 
creating records and passing the existing information on to consumers.
    FDA estimates that there is an average of 600,000 machines that 
sell unpackaged products. FDA tentatively estimates that between 5 and 
10 percent of all operators of vending machines with covered vending 
machine food, or an average of 810 operators, will need to acquire 
nutrition information for at least some covered vending machine food. 
FDA tentatively estimates that there are between 5 to 10 covered 
vending machine foods that do not include nutrition information per 
operator, so that the average number of possible new calorie analyses 
would be 6,480 (8 items/firm x 810 firms). FDA requests comment on 
these estimates. Based on data from FDA's Recordkeeping Cost Model 
(Ref. 28), we estimate approximately 4 hours as the time per covered 
vending machine food for creating the record of nutritional 
information. Although the proposed rule does not mandate recordkeeping, 
vending machine operators will likely need to be able to ensure that 
calorie disclosures for covered vending machine foods are accurate and 
consistent without needing to re-analyze these foods. The estimated 
number of hours required for new calorie analysis in the first year is 
then 25,920 hours. This number is displayed in the first row of table 3 
of this document.
    FDA believes that the subgroup of covered vending machine foods 
sold in these vending machines is approximately constant. If there is 
0.5 percent growth or turnover in the number of firms providing these 
unpackaged foods, then approximately four new firms will become subject 
to section 4205 of the Affordable Care Act and the proposed 
requirements in a given year. The burden associated with these firms 
would be 128 hours (4 firms x 8 items/firm x 4 hours/item). This amount 
is given in second row of table 7 of this document.
    These estimated annual recordkeeping burdens have changed from the 
burdens estimated for the OMB control number 0910-0665 30-day notice 
(76 FR 5380, January 31, 2011). Total initial hours have risen by 1,920 
due to an increase in the estimated number of recordkeepers from 600 to 
915 and an increase in the number of hours per record from 2 hours to 4 
hours. The estimated burden of

[[Page 19251]]

recurring hours increased by 8 hours to 128 hours. This change is due 
to an increase in the estimated number of new operators (which stems 
from the increase in the number of initial recordkeepers), and the 
increase in the number of hours per record. These changes are due to 
additional data and analysis that FDA was able to collect in the 
interim.

                                     Table 3--Estimated Annual Recordkeeping Burden: Calorie Analysis and Recording
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                         Average burden
                                            Number of       Number of     Total annual         per                           Total capital costs for
            Type of response              recordkeepers    records per       records      recordkeeping    Total hours            recordkeeping
                                                          recordkeeper                     (in hours)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Initial hours for vending operators....             810               8           6,480               4          25,920  $1.3 million.
Recurring hours for vending operators..               4               8              32               4             128  $6,400.
                                        ----------------------------------------------------------------------------------------------------------------
    Total..............................  ..............  ..............  ..............  ..............          26,048  ...............................
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ There are no operating and maintenance costs associated with this collection of information.

    The third party disclosure burden for vending machine operators is 
the time necessary to install calorie displays on their vending 
machines. In the PRIA, FDA estimates an average, recurring hourly 
burden of 0.17 hours per machine per year to install and maintain the 
displays. FDA estimates an average of 4.8 million machines are serviced 
by 10,800 operators, for an average number of machines per operator of 
444 machines. The estimated recurring hours needed for third party 
disclosure is then 816,000 hours (10,800 firms x 444 machines/firm x 
0.17 hours/display). This amount is recurring in every year, and is 
given in table 4 of this document.
    These estimated annual third party disclosure burdens have changed 
from the burdens estimated for the OMB Control Number 0910-0665 30-day 
notice (76 FR 5380, (Jan. 31, 2011)). This estimate of third party 
disclosure hours has decreased by approximately 13.2 million hours, 
from the 14 million hours estimate given in the 30-day notice. In 
addition, we no longer estimate any growth in the number of hours, 
given that data shows no significant increase in the number of vending 
machines over the last several years. These changes are due to 
additional data and analysis that FDA was able to collect in the 
interim.

                                        Table 4--Estimated Annual Third Party Disclosure Burden: Calorie Content
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Average
                                 Number of       Number of     Total annual     burden per                                             Total operating
     Type of respondent         respondents     disclosures     disclosures     disclosure      Total hours    Total capital costs          costs
                                              per respondent                    (in hours)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Recurring burden for vending          10,800             444       4,800,000            0.17         816,000  $4.8 million........  $19.2 million.
 operators.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The current total reporting burden for menu labeling and vending 
machine operator registration as required by section 4205, now under 
review at OMB under No. 0910-0664, is 820 hours. The estimated 
reporting burden under the Menu Labeling proposed rule is 2,190 hours, 
an increase of 1,370 hours. As described in the paperwork analysis in 
that proposed rule, this increase is due to an increase in the 
estimated number of respondents. This proposed rule does not further 
revise those estimates.
    In compliance with the PRA, the agency has submitted the 
information collection provisions of this proposed rule to OMB for 
review. Interested persons are requested to send comments regarding the 
information collection to OMB (see DATES and ADDRESSES sections of this 
document).

VII. Federalism

    FDA has analyzed this proposed rule in accordance with the 
principles set forth in Executive Order 13132. Section 4(a) of the 
Executive order requires agencies to ``construe * * * a Federal statute 
to preempt State law only where the statute contains an express 
preemption provision or there is some other clear evidence that the 
Congress intended preemption of State law, or where the exercise of 
State authority conflicts with the exercise of Federal authority under 
the Federal statute.'' Federal law includes an express preemption 
provision that preempts ``any requirement for nutrition labeling of 
food that is not identical to the requirement of section [21 U.S.C. 
343(q)]'' (21 U.S.C. 343-1(a)(4)), except that this provision does not 
apply ``to food that is offered for sale in a restaurant or similar 
retail food establishment that is not part of a chain with 20 or more 
locations doing business under the same name (regardless of the type of 
ownership of the locations) and offering for sale substantially the 
same menu items unless such restaurant or similar retail food 
establishment complies with the voluntary provision of nutrition 
information requirements under [21 U.S.C. 343(q)(5)(H)(ix)].'' (21 
U.S.C. 343-1(a)(4)). If this proposed rule is made final, the final 
rule would create requirements for nutrition labeling of food under 21 
U.S.C. 343(q) that would preempt certain non-identical State and local 
nutrition labeling requirements.
    Section 4205 of the Affordable Care Act also included a Rule of 
Construction providing that ``Nothing in the amendments made by 
[section 4205] shall be construed--(1) to preempt any provision of 
State or local law, unless such provision establishes or continues into 
effect nutrient content disclosures of the type required under section 
403(q)(5)(H) of the Federal Food, Drug, and Cosmetic Act [21 U.S.C. 
343(q)(5)(H)] (as added by subsection(b)) and is expressly preempted 
under subsection (a)(4) of such section; (2) to apply to any State or 
local requirement respecting a statement in the labeling of food that 
provides for a warning concerning the safety of the food or

[[Page 19252]]

component of the food; or (3) except as provided in section 
403(q)(5)(H)(ix) of the Federal Food, Drug, and Cosmetic Act [21 U.S.C. 
343(q)(5)(H)(ix)] (as added by subsection (b)), to apply to any 
restaurant or similar retail food establishment other than a restaurant 
or similar retail food establishment described in section 
403(q)(5)(H)(i) of such Act [21 U.S.C. 343(q)(5)(H)(i)].'' (Pub. L. 
111-148, Sec.  4205(d), 124 Stat. 119, 576 (2010)0.
    FDA interprets the provisions of Section 4205 of the Affordable 
Care Act related to preemption to mean that States and local 
governments may not impose nutrition labeling requirements for food 
sold in vending machines that must comply with the Federal requirements 
of 21 U.S.C. 343(q)(5)(H), unless the State or local requirements are 
identical to the Federal requirements. In other words, States and 
localities cannot have additional or different nutrition labeling 
requirements for food sold either (1) from vending machines that are 
operated by a person engaged in the business of owning or operating 20 
or more vending machines subject to the requirements of 21 U.S.C. 
343(q)(5)(H)(viii) or (2) from vending machines operated by a person 
not subject to the requirements of 21 U.S.C. 343(q)(5)(H)(viii) who 
voluntarily elects to be subject to those requirements by registering 
biannually under 21 U.S.C. 343(q)(5)(H)(ix).
    Otherwise, for food sold from vending machines not subject to the 
nutrition labeling requirements of 21 U.S.C. 343(q)(5)(H)(viiii), 
States and localities may impose nutrition labeling requirements. Under 
FDA's interpretation of the Rule of Construction in section 4205(d)(1) 
of the Affordable Care Act, nutrition labeling for food sold from these 
vending machines would not be ``nutrient content disclosures of the 
type required under [21 U.S.C. 343(q)(5)(H)]'' and, therefore, would 
not be preempted. Under this interpretation, States and localities 
would be able to continue to require nutrition labeling for food sold 
from vending machines which are exempt from nutrition labeling under 21 
U.S.C. 343(q)(5). This interpretation is consistent with the fact that 
Congress included vending machine operators in the voluntary 
registration provision of 21 U.S.C. 343(q)(5)(H)(ix). There would have 
been no need to include vending machine operators in the provision that 
allows opting into the Federal requirements if States and localities 
could not otherwise require non-identical nutrition labeling for food 
sold from any vending machines.
    An alternative to FDA's interpretation of the provisions of section 
4205 of the Affordable Care Act related to preemption could leave less 
room for States and localities to require nutrition labeling for food 
sold from vending machines. Under this alternative interpretation, 
State or local nutrition labeling requirements for food sold from 
vending machines would be preempted because such nutrition labeling 
requirements would be ``nutrition content disclosures of the type 
required under [21 U.S.C. 343(q)(5)(H)]'' and would not fall within the 
exception to preemption in 21 U.S.C. 343-1(a)(4) (``except that this 
paragraph does not apply to food that is offered for sale in a 
restaurant or similar retail food establishment that is not part of a 
chain with 20 or more locations * * *'').
    Under this alternative interpretation, States and localities could 
not have nutrition labeling requirements for vending machines that were 
not identical to the Federal requirements, unless they successfully 
petitioned FDA. The position that no State or locality may have a 
vending machine nutrition labeling requirement not identical to the 
Federal requirements, regardless of how many vending machines the 
operator owns or operates, was the position in the guidance issued by 
FDA on August 25, 2010 (``Guidance for Industry: Questions and Answers 
Regarding the Effect of Section 4205 of the Patient Protection and 
Affordable Care Act of 2010 on State and Local Menu and Vending Machine 
Labeling Laws'' (75 FR 52427)). Federal law provides that, upon 
petition, FDA may exempt State or local requirements from the express 
preemption provisions of 21 U.S.C. 343-1(a) under certain conditions. 
21 U.S.C. 343-1(b). FDA has promulgated regulations at 21 CFR 100.1 
describing the petition process that is available to State and local 
governments to request such exemptions from preemption. Under the 
interpretation being proposed by FDA, for food sold from vending 
machines that is not subject to the nutrition labeling requirements of 
21 U.S.C. 343(q)(5)(H), States and localities may establish or continue 
to impose nutrition labeling requirements. Under the alternative 
interpretation described above, there would be vending machines for 
which the Federal government has not required nutrition labeling and 
for which States and localities would also be precluded from 
establishing such labeling requirements unless they successfully 
petitioned FDA and a rulemaking was completed. This approach would risk 
creating a regulatory gap that would be inconsistent with the purposes 
of section 4205. It would also impose a restriction and burden on the 
States and localities that is inconsistent with the Federalism 
principles expressed in Executive Order 13132, as well as a substantial 
administrative burden on FDA in the event states petition for 
exemption.
    FDA requests comments on the Agency's interpretation of the 
provisions of section 4205 of the Affordable Care Act related to 
preemption, as well as on the alternative interpretation described in 
the Federalism section. FDA also requests comments on the use of the 
petition process in the context. In addition, the Agency requests 
comments on other potential interpretations that interested persons 
identify as appropriate given both the preemption-related language of 
section 4205 and the statutory goals.
    In addition, the express preemption provisions of 21 U.S.C. 343-
1(a)(4) do not preempt any State or local requirement respecting a 
statement in the labeling of food that provides for a warning 
concerning the safety of the food or component of the food. This is 
clear from both the literal language of 21 U.S.C. 343-1(a)(4) with 
respect to the scope of preemption and from the Rule of Construction at 
section 4205(d)(2) of the Affordable Care Act.

VIII. Environmental Impact

    The Agency has determined under 21 CFR 25.30(k) that this action is 
of a type that does not individually or cumulatively have a significant 
effect on the human environment. Therefore, neither an environmental 
assessment nor an environmental impact statement is required.

 IX. Comments

    Interested persons may submit to the Division of Dockets Management 
(see ADDRESSES) either electronic or written comments regarding this 
document. It is only necessary to send one set of comments. It is no 
longer necessary to send two copies of mailed comments. Identify 
comments with the docket number found in brackets in the heading of 
this document. Received comments may be seen in the Division of Dockets 
Management between 9 a.m. and 4 p.m., Monday through Friday.

X. References

    The following references have been placed on display in the 
Division of Dockets Management (see ADDRESSES) and may be seen by 
interested persons between 9 a.m. and 4 p.m., Monday through Friday. 
(FDA has verified the

[[Page 19253]]

Web site addresses, but FDA is not responsible for any subsequent 
changes to the Web sites after this document publishes in the Federal 
Register.)

1. Merriam Webster Collegiate Dictionary, Tenth Edition, 1993.
2. Food and Drug Administration, Food Labeling Guide, pg. 7, 2009. 
http://www.fda.gov/FoodLabelingGuide/accessed, March 28, 2011.
3. Automatic Merchandiser. ``2010 State of the Vending Industry 
Report.'' http://www.vendingmarketwatch.com/content/reports/ 
accessed, November 09, 2010.
4. National Automatic Merchandising Association. ``Comments of: The 
National Automatic Merchandising Association.'' Docket No. FDA-2010-
N-0298 2010.
5. U.S. Small Business Administration. ``Table of Small Business 
Size Standards Matched to North American Industry Classification 
System Codes,'' Effective November 5, 2010. http://www.sba.gov/idc/groups/public/documents/sba_homepage/serv_sstd_tablepdf.pdf, 
accessed 12/10/2010.
6. Jed, E. ``Operators Find Today's Patrons Favor `Better-For-You' 
Food Selections In Vending,'' Vending Times, 41:8, 2001.
7. Finkelstein, E.A. and K.L. Strombotne. ``The Economics of 
Obesity.'' American Journal of Clinical Nutrition, 91(5): 1520S-
1524S, May 2010.
8. Philipson, T. and R. Posner. ``Is the Obesity Epidemic a Public 
Health Problem? A Decade of Research on the Economics of Obesity.'' 
NBER Working Paper Series, 14010, May 2008.
9. Downs, J.S., G. Loewenstein and J. Wisdom. ``Strategies for 
Promoting Healthier Food Choices.'' American Economic Review: Papers 
and Proceedings, 99(2): 1-10, 2009.
10. O'Donoghue, T. and M. Rabin. ``The Economics of Immediate 
Gratification.'' Journal of Behavioral Decision Making, 13(2): 233-
250, 2000.
11. O'Donoghue, T. and M. Rabin. ``Doing it Now or Later.'' American 
Economic Review, 89(1): 103-124, 1999.
12. Wang, Y., M.A. Beydoun, L. Liang, B. Cabellero and S.K. 
Kumanyika, ``Will all Americans Become Overweight or Obese? 
Estimating the Progression and Cost of the US Obesity Epidemic.'' 
Obesity, 16(10): 2323-2330, 2008.
13. Ogden, C.L. and M.D. Carroll. ``Prevalence of Overweight, 
Obesity, and Extreme Obesity Among Adults: United States, Trends 
1976-1980 Through 2007-2008.'' National Center for Health 
Statistics, June 2010.
14. Sullivan, P.W., V. Ghusheyan, and R.H. Ben-Joseph. ``The Effect 
of Obesity and Cardiometabolic Risk Factor on Expenditures and 
Productivity in the US.'' Obesity, 16: 2155-2162, 2008.
15. Ali, M.M., A. Amialchuk, and F. Renna. ``Social Network and 
Weight Misperception Among Adolescents''. Southern Economic Journal, 
Forthcoming, (2010a).
16. Cawley, J., K. Joyner, and J. Sobal. ``Size Matters: The 
Influence of Adolescent's Weight and Height on Dating and Sex.'' 
Rationality and Society, 18(1): 67-94, 2006.
17. Ali, M.M., H. Fang, and J. Rizzo. (2010b). ``Body Weight, Self-
Perception and Mental Health among Adolescents.'' Journal of Mental 
Health Policy and Economics, 13(2): 53-63 (2010b).
18. Puhl, R., and K.D. Brownell. ``Bias, Discrimination, and 
Obesity.'' Obesity Research, 9(12): 788-805, 2001.
19. Cawley, J. ``The Impact of Obesity on Wages.'' Journal of Human 
Resources, 39(2): 451-474, 2004.
20. Finkelstein, E.A., J.G. Trogdon, J.W. Cohen and W. Dietz. 
``Annual Medical Spending Attributable to Obesity: Payer- and 
Service-Specific Estimates.'' Health Affairs, 28(5): w822-w831, 
2009.
21. Lakdawalla, D. and T.J. Philipson. ``The Growth of Obesity and 
Technological Change: A Theoretical and Empirical Examination,'' 
NBER Working Paper No. 8946, 2002.
22. Philipson, T.J. and R.A. Posner, ``The Long-Run Growth in 
Obesity as a Function of Technological Change.'' NBER Working Paper 
No. 7423, 1999.
23. Cutler, D.M., E.L. Glaeser, and J.M. Shapiro, ``Why Have 
Americans Become More Obese?'' Journal of Economic Perspectives, 17: 
93-118, 2003.
24. Chou, S-Y., M. Grossman, and H. Saffer. ``An Economic Analysis 
of Adult Obesity: Results from the Behavioral Risk Factor 
Surveillance System.'' Journal of Health Economics, 23: 565-587, 
2004.
25. Burke, M. and F. Heiland. ``Social Dynamics of Obesity.'' 
Economic Inquiry, 45(3), 571-591, 2007.
26. French, S.A., R.W. Jeffery, M. Story, P. Hannan, and P. Snyder. 
``A Pricing Strategy to Promote Low-Fat Snack Choices through 
Vending Machines''. American Journal of Public Health, 87: 849-851, 
1997.
27. U.S. Department of Agriculture Economic Research Service. 
``Table 15: Sales of meals and snacks away from home by type of 
outlet.'' Food CPI and Expenditures: Food Expenditure Tables. http://www.ers.usda.gov/Briefing/CPIFoodAndExpenditures/Data/ Accessed 10/
8/2010.
28. Eastern Research Group, Inc. ``Evaluation of Recordkeeping Costs 
for Food Manufacturers, Final Report.'' Prepared for Andy Estrin and 
Cristina McLaughlin of FDA's Center for Food Safety and Applied 
Nutrition. Prepared by Aylin Sertkaya, Ayesha Berlind and Seda 
Erdem. Contract No. 223-01-2461, Task Order Number 5, February 2007.

List of Subjects

21 CFR Part 11

    Administrative practice and procedure, Computer technology, 
Reporting and recordkeeping requirements.

21 CFR Part 101

    Food labeling, Nutrition, Reporting and recordkeeping requirements.

    Therefore, under the Federal Food, Drug, and Cosmetic Act and under 
authority delegated to the Commissioner of Food and Drugs, it is 
proposed that 21 CFR parts 11 and 101 be amended as follows:

PART 11--ELECTRONIC RECORDS; ELECTRONIC SIGNATURES

    1. The authority citation for 21 CFR part 11 continues to read as 
follows:

    Authority:  21 U.S.C. 321-393; 42 U.S.C. 262.

    2. Section 11.1 is amended by adding paragraph (h) to read as 
follows:

Sec.  11.1  Scope.

* * * * *
    (h) This part does not apply to electronic signatures obtained 
under Sec.  101.8(d) of this chapter.

PART 101--FOOD LABELING

    3. The authority citation for 21 CFR part 101 continues to read as 
follows:

    Authority:  15 U.S.C. 1453, 1454, 1455; 21 U.S.C. 321, 331, 342, 
343, 348, 371; 42 U.S.C. 243, 264, 271.

    4. Section 101.8 is added to subpart A to read as follows:

Sec.  101.8  Vending machines.

    (a) Definitions. The definitions of terms in section 201 of the 
Federal Food, Drug, and Cosmetic Act apply to such terms when used in 
this section. In addition, for the purposes of this section:
    Authorized official of a vending machine operator means the owner, 
operator, or agent in charge or any other person authorized by the 
vending machine operator to register the vending machine operator, 
which is not otherwise subject to the requirements of section 
403(q)(5)(H) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 
343(q)(5)(H)) with FDA for purposes of paragraph (d) of this section.
    Vending machine means a self-service device that, upon insertion of 
a coin, paper currency, token, card, or key, or by optional manual 
operation, dispenses servings of food in bulk or in packages, or 
prepared by the machine, without the necessity of replenishing the 
device between each vending operation.
    Vending machine operator means a person(s) or entity that controls 
or directs the function of the vending machine, including deciding 
which articles of food are sold from the machine or the placement of 
the articles of food within the vending machine, and is compensated for 
the control or direction of the function of the vending machine.

[[Page 19254]]

    (b) Articles of food not covered. Articles of food dispensed from a 
vending machine are not covered vending machine food if:
    (1) The prospective purchaser can view the entire Nutrition Facts 
Panel on the label of the vended food without an obstruction. The 
Nutrition Facts Panel must be the information in the format required in 
Sec.  101.9(c) and (d). The Nutrition Facts Panel must be in a size 
that permits the prospective purchaser to be able to easily read the 
nutrition information contained in the Nutrition Facts Panel on the 
label of the article of food in the vending machine. Smaller formats 
allowed for nutrition facts for certain food labeling under FDA 
regulation at Sec.  101.9 are not considered to be a size that a 
prospective purchaser is able to easily read.
    (2) An article of food sold from a vending machine provides visible 
nutrition information at the point of purchase. The visible nutrition 
information at the point of purchase includes the total number of 
calories for the article of food, as dispensed, at the point of 
purchase. This visible nutrition information must appear on the food 
label itself. This visible nutrition information must be clear and 
conspicuous and easily read on the article of food while in the vending 
machine, in a type size reasonably related to the largest printed 
matter on the label and with sufficient color and contrasting 
background to other print on the label to permit the prospective 
purchaser to clearly distinguish the information.
    (c) Requirements for calorie labeling for certain food sold from 
vending machines.
    (1) Applicability; covered vending machine food. For the purposes 
of this section, the term ``covered vending machine food'' means an 
article of food that is:
    (i) Sold from a vending machine that:
    (A) Does not permit the consumer to examine the Nutrition Facts 
Panel prior to purchase as provided in paragraph (b) of this section, 
or otherwise provide visible nutrition information at the point of 
purchase as provided in paragraph (b);
    (B) Is operated by a person engaged in the business of owning or 
operating 20 or more vending machines; and
    (C) Is a vending machine with a selection button; or
    (ii) Sold from a vending machine that is operated by a vending 
machine operator that has voluntarily elected to be subject to the 
requirements of this section by registering with the FDA under the 
provisions of paragraph (d) of this section.
    (2) Calorie declaration. (i) The number of calories must be clear 
and conspicuous for a covered vending machine food and declared in the 
following manner:
    (A) To the nearest 5-calorie increment up to and including 50 
calories and 10-calorie increment above 50 calories, except that 
amounts less than 5 calories may be expressed as zero.
    (B) The term ``Calories'' or ``Cal'' must appear adjacent to the 
caloric content value for each food in the vending machine.
    (C) For calorie declarations in or on the vending machine, the 
declaration of calories must be in a type size no smaller than the name 
of the food on the machine, not the label, selection number, or price 
of the food as displayed on the vending machine, whichever is smallest, 
with the same prominence, i.e., the same color, or in a color at least 
as conspicuous, as the color of the name, if applicable, or price of 
the food or selection number, and the same contrasting background, as 
the item it is in closest proximity to, i.e., name, selection number, 
or price of the food item as displayed on the machine.
    (D) The number of calories for single-serving packaged food 
declared on the sign must be identical to the number of calories that 
are declared in the Nutrition Facts, if applicable.
    (E) The number of calories for packaged foods that contain multiple 
servings must include the total calories present in the covered vending 
machine food. The vending machine operator may voluntarily disclose 
calories per serving in addition to the total calories for the food.
    (ii) Calorie information for covered vending machine food must be 
placed prominently in the following manner:
    (A) This calorie information may be placed on a sign in close 
proximity to the article of food or selection button, i.e., in, on, or 
adjacent to the vending machine, but not necessarily attached to the 
vending machine, so long as the sign is visible at the same time as the 
food, its name, price, or selection button or selection number is 
visible.
    (B) When the calorie information is in or on the vending machine, 
the calorie declaration must be in the same color or a color at least 
as conspicuous as the color of the name or the price of the food or 
selection number.
    (C) When the calorie information is declared on a sign adjacent to 
the vending machine, the calorie declaration must be in type that is 
all black or one color printed on a white or other neutral background 
that contrasts with the type color.
    (D) Where the vending machine only displays a vignette or name of 
the food item, the calorie information must be in close proximity to 
the vignette or name or in close proximity to the selection button.
    (E) For electronic vending machines (e.g., machines with digital or 
electronic or liquid crystal display (LCD) displays), the calorie 
information may be displayed when the selection numbers are entered but 
before the selection is confirmed.
    (F) For vending machines with limited choices, e.g., popcorn, the 
declaration of calories may appear on the face of the machine so long 
as the declaration is prominent, not crowded by other labeling on the 
machine, and the type size is reasonably related to the largest print 
on the vending machine.
    (d) Voluntary provision of calorie labeling for foods sold from 
vending machines.
    (1) Applicability. An authorized official of a vending machine 
operator that is not subject to the requirements of section 
403(q)(5)(H)(viii) of the Federal Food, Drug, and Cosmetic Act may 
voluntarily register with FDA to be subject to the requirements 
established in paragraph (c)(2) of this section. An authorized official 
of a vending machine operator that voluntarily registers cannot be 
subject to any State or local nutrition labeling requirements that are 
not identical to the requirements in 403(q)(5)(H) of the Federal Food, 
Drug, and Cosmetic Act.
    (2) Who may register? A vending machine operator that is not 
otherwise subject to the requirements of section 403(q)(5)(H) of the 
Federal Food, Drug, and Cosmetic Act may register with FDA.
    (3) What information is required? The vending machine operator must 
provide FDA with the following information:
    (i) The contact information (including name, address, phone number, 
e-mail address), for the vending machine operator;
    (ii) The address of the location of each vending machine owned or 
operated by the vending machine operator that is being registered.
    (iii) Preferred mailing address (if different from the vending 
machine operator address), for purposes of receiving correspondence; 
and
    (iv) Certification that the information submitted is true and 
accurate, that the person or firm submitting it is authorized to do so, 
and that each registered vending machine will be subject to the 
requirements of this section.
    (v) Information should be submitted by e-mail by typing complete

[[Page 19255]]

information into the portable document format (PDF) form, saving it on 
the registrant's computer, and sending it by e-mail to 
menulawregistration@fda.hhs. If e-mail is not available, the registrant 
can either fill in the PDF form and print it out (or print out the 
blank PDF and fill in the information by hand or typewriter), and 
either fax the completed form to 301-436-2804 or mail it to FDA, White 
Oak Building 22, Rm. 0209, 10903 New Hampshire Ave., Silver Spring, MD 
20993.
    (vi) Authorized officials of a vending machine operator who elects 
to be subject to the Federal requirements can register by visiting 
http://www.fda.gov/menulabeling. FDA has created a form that contains 
fields requesting the information in paragraph (d) of this section and 
made the form available at this Web site. Registrants must use this 
form to ensure that complete information is submitted.
    (vii) To keep the establishment's registration active, the 
authorized official of the vending machine operator must register every 
other year within 60 days prior to the expiration of the vending 
machine operator's current registration with FDA. Registration will 
automatically expire if not renewed.
    (e) Signatures. Signatures obtained under paragraph (d) of this 
section that meet the definition of electronic signatures in Sec.  
11.3(b)(7) of this chapter are exempt from the requirements of part 11 
of this chapter.

    Dated: March 28, 2011.
Margaret A. Hamburg,
Commissioner of Food and Drugs.
Kathleen Sebelius,
Secretary of Health and Human Services.
[FR Doc. 2011-8037 Filed 4-1-11; 4:15 pm]
BILLING CODE 4160-01-P