Get ready, set, go! After years of delay, FDA is now on a fast-track to finalize its proposed regulation on accreditation of third-party auditors in accordance with the Food Safety Modernization Act (FSMA), 78 Fed. Reg. 45,781 (July 29, 2013) Accreditation of Third-Party Auditors and Certification Bodies. The agency also issued a proposed rule on the Foreign Supplier Verification Program, (FSVP) that, as a practical matter, turns some food importers into de facto public health officials, who will likely rely on third-party auditors and certifiers to ensure that imported food is safe to enter the U.S.
A FDA “public meeting” for stakeholders is scheduled for September 19-20; written comments are due by November 26; and the agency is under a federal court Order to finalize the proposed regulation (and other FSMA rules) by June 2015.
Those in the business of auditing and certifying food production facilities may be in for some big changes if FDA’s proposed regulation is finalized “as is.” Hopefully, the agency will be persuaded by comments it receives. The White House Office of Management and Budget OMB), and the House Appropriations Committee, will also have a major role in influencing whatever FDA attempts to finalize.
FDA characterizes the use of auditing and certification as “voluntary.” However, as a practical matter, private-sector auditing and certification services are essential to the operation of FSVP, a defining portion of FSMA, which places a burden on importers to assure food safety. Auditing and certification will also play a central role in the yet to be proposed Voluntary Qualified Importer Program that is set out in FSMA and which permits FDA to give import preferences to foods subject to third-party audits and certifications.
Ominously, at the end of its preamble to its proposed regulation, FDA cites the U.S. government’s obligations under the World Trade Organization Agreement to treat domestically produced food the same as imported food and states that: “We realize that the same principles that are features of a rigorous and credible program for audits of foreign firms would likewise hold great merit for audits of domestic food facilities.” 78 Fed. Reg. at 45823. So in short, the proposed regulations for auditing and certifying imports may become the de facto rules for auditing and certifying domestically produced foods.
Some of the largest problems that could literally change the auditing and certification industry are FDA’s proposed reporting and notification requirements. The results of “Consultative Audits” (traditionally referred to in the industry as “second-party audits”) need not be automatically reported to FDA. (FDA may obtain access to them under the emergency provisions of the Bioterrorism Act if the agency has a reasonable belief that an article of food presents a threat of serious adverse health consequences). That’s a good thing because the purpose of a consultative audit is to confidentially advise a food production facility to fix problems before they cause serious injury. This is in contrast to the purpose of what the industry traditionally refers to as a “third-party” audit, now known under FSMA and FDA’s proposed rule as a “regulatory audit.” Under FSMA, the primary purpose of this type of audit is to obtain a certification acceptable to FDA under FSMA’s FSVP and VQIP programs.
Disclosing confidential advice typically given by an auditor to a food company would cause the current system to implode; few companies would want to use FDA accredited auditors if they were required to “blow the whistle” on a food company’s good faith, behind the scenes efforts, to correct problems and make improvements.
Under the proposed regulation, FDA states that an accredited auditor conducting a “consultative audit” must notify FDA if it finds a “serious risk to public health,” including risk levels akin to those matters that give rise to both Class I and Class II recalls.
FDA’s proposed regulation, as it now stands, would have the unintended effect of providing incentives for food production facilities to use unaccredited auditors who have no regulatory obligation to report to FDA risks discovered during a consultative audit. FDA specifically requests comments on the issue, 78 Fed. Reg. 45815. That means FDA knows that the proposal suffers from infirmities and that the agency may be on weak legal ground if it attempts to finalize the provision in its current form.
Further blows to all-important confidentiality include a provision in FDA’s proposed regulation that requires laboratory testing results conducted during a consultative audit (whether conducted by an accredited third-party auditing and certification company’s own labs or another FDA accredited laboratory) to be sent directly to FDA. This proposed requirement could similarly result in unintended consequences by providing food companies an incentive to use unaccredited auditors for consultative audits in order to keep results and recommendations confidential.
Ideally, FDA’s proposed regulation should support and encourage expansion of reasonably regulated auditing and certification services as contemplated by the drafters of FSMA. However, broad reporting requirements and submission to FDA of laboratory reports for consultative (not just regulatory audits resulting in certification under FSMA may have the opposite effect and cripple the most credible members of the auditing and certifying industry, as some food production facilities move to use unaccredited entities for consultative purposes.
The fact that statements made to an accredited auditor carries the same legal liability, including the possibility of criminal prosecution, as statements made to FDA itself doesn’t help. Auditing and certification companies, as well as food companies, have good reason to fully participate in the rulemaking process.
The process has now officially begun and will continue through next year. FDA’s first “public meeting” on the matter is not just an exercise in government transparency and public participation. FDA relied on statements made at previous “public meetings” to justify key parts of its proposed regulation. FDA will likely do the same to justify whatever it comes up with for a final regulation. Agency justifications are essential because if a final regulation is challenged in federal court, the court will look at the agency’s justification to determine if FDA engaged in “reasoned decision-making.”
By weighing in now, and remaining persistent during the rulemaking process, those with a stake in the outcome of FDA’s final regulation will have the best chance of making sure the agency makes sound public policy choices and avoids final rules that have unintended consequences.
