BEIJING BRUSSELS CHICAGO DALLAS FRANKFURT GENEVA HONG KONG LONDON LOS ANGELES NEW YORK SAN FRANCISCO SHANGHAI SINGAPORE SYDNEY TOKYO WASHINGTON, D.C.
U.S. Regulation of Catfish – and Basa and Tra
April 2009
Brenda A. Jacobs
Sidley Austin LLP
Washington, DC
Catfish . . . Basa and Tra
• Since 2002, U.S. catfish producers have battled
against competition with imports.
– First, they initiated an antidumping investigation that
resulted in an order applying additional duties on
imports from Vietnam (Certain Frozen Fish Fillets).
– Second, a law was enacted banning Vietnamese basa
and tra from being labeled “catfish” in the U.S. market.
– Most recently, another new U.S. law will make imports
of catfish subject to inspection upon entry into the
United States.
• Is basa and tra subject to this new rule?
• Can the U.S. say a fish cannot be labeled “catfish” for purposes of
marketing, but it is considered catfish for purposes of inspection
requirements?
Catfish . . . Basa and Tra
• What is going on?
• Different laws, different federal agencies
• U.S. political interests
– Strong U.S. catfish industry
– Anti-China backlash
• China accounts for a large share of U.S. food imports, including
seafood (As of 2006, China reportedly accounted for 10 percent of
the seafood consumed in the United States.)
• Increased concern about the safety of the U.S. food supply
– According to U.S. Department of Agriculture data,
approximately 85 percent of all U.S. seafood consumption
(including catfish) is from imports.
• Compare that with a 15 percent import share for all U.S. food
consumption
The Labeling Rule
• In 2002, the U.S. Farm Security and Rural
Investment Act amended the food misbranding
provision of the Federal Food, Drug and Cosmetic
Act, to say that a food is misbranded “if it
purports to be or is represented as catfish,
unless it is a fish classified within the family
Ictaluridae.”
– Basa and tra are pangasius
• The U.S. Food and Drug Administration (FDA) is
responsible for enforcing the labeling provisions.
– FDA is part of the U.S. Department of Health and
Human Services.
The Labeling Rule
• FDA provides a guide to “acceptable market names”
for seafood sold in the United States
• The Guidance defines the different categories of
names found in THE SEAFOOD LIST and outlines
principles that can be used to label seafood species
sold in the U.S. with an appropriate, nonmisleading
statement of identity.
• http://www.foodsafety.gov/~comm/seaguid7.html
The Labeling Rule
• Despite the antidumping duty order and the labeling rule,
U.S. imports of Vietnamese basa and tra have continued to
grow.
– In 2002, Vietnam accounted for 4,361 tons of basa and tra
into the U.S.; In 2006, Vietnam accounted for 17,998 tons.
– U.S. imports of basa and tra from Vietnam accounted for
US$77 million in 2008, up from US$55.7 million in 2007.
• But so have U.S. imports of catfish from China.
– U.S. imports of catfish from China totaled US$40 million in
2008 (up from US$29 million in 2007) and
– China also shipped US$12.5 million worth of basa and tra in
2008
The Safety Concern
• “Tainted imported catfish
may be reaching
consumers’ dinner tables.”
– Catfish Farmers of
America
• “During the 12 months
ending January 2007, 49
shipments of Chinese
farmed catfish were
refused by the U.S. FDA,
because they contained
banned and potentially
dangerous chemicals and
antibiotics. In January
2007 alone, 10 shipments
were refused entry, up
from 2 refusals in January
2006.”
The Safety Concern
• In response, as part of the “2008 Farm Bill,” the
U.S. Congress amended the Federal Meat
Inspection Act to designate catfish, as defined by
the Secretary of Agriculture, an “amenable
species.”
– Amenable species means that it is subject to mandatory
inspection.
– Definition of catfish to be decided by implementing
regulations.
• This new law is implemented by the Food Safety
and Inspection Service
– FSIS is part of the U.S. Department of Agriculture.
The Safety Concern: Inspections
• It is the intent of Congress “that catfish be subject to
continuous inspection and that imported catfish
inspection programs be found to be equivalent under
USDA regulations before foreign catfish may be
imported into the United States.”
• As a result of the new law, FSIS is responsible for
ensuring that meat, poultry, egg and catfish in
interstate and foreign commerce “are wholesome, not
adulterated, and properly marked, labeled and
packaged.”
• FSIS is required to implement the new law within 18
months of enactment (which was June 18, 2008).
That means it should issue implementing regulations
by December 2009.
The Safety Concern: Inspections
• FSIS said that it would issue a “Notice of Proposed
Rulemaking,” (NPRM) by March 2009, in order to
meet the December 2009 deadline for a final rule.
– No NPRM was issued in March.
– But FSIS says the regulations will define catfish and the
scope of coverage of the regulations to apply to
establishments that process catfish and catfish
products.
• Chinese production is based on imported brood stock from
the U.S., so it is the same species (ictalurus) as the U.S.
– FSIS says the regulations will “take into account the
conditions under which the catfish are raised and
transported to a processing establishment.”
Grading Too?
• Another provision in the new law amends the
Agricultural Marketing Act to require USDA to
establish a voluntary grading program for
catfish, which producers could opt into and
pay for with user fees.
What Next?
• Vietnam should urge FSIS to define catfish consistent with
the definition applied by FDA, BUT even if FSIS agrees that
the definition of catfish should be limited to Ictalurus,
excluding Panga, all signs point to more food safety
legislation in the United States.
• The recent outbreak of salmonella at a peanut processing
plant in the U.S., causing more food recalls than ever
before in the history of the U.S. (with 100 companies
recalling 3,500 different products), means that both the
new Administration and the Congress are looking at
additional updates to existing food safety laws.
Obama Administration
• In March, President Obama announced
the creation of a Food Safety Working
Group.
– will include the Secretaries of HHS and Agriculture, to
advise him on which laws and regulations need to be
changed, to foster coordination across federal agencies,
and to ensure that laws are enforced.
– Obama appears to support increased inspections over
proposals to rely upon third party auditors.
The Congress
• A number of food safety bills have been
introduced in the Congress.
– There is a debate within the Congress about whether to
bolster food oversight at the FDA or assign those
responsibilities to a separate agency that would eventually
absorb the food-oversight duties of 11 other agencies,
including the FSIS.
– Bills already introduced in 2009 seek to increase the
frequency of inspections and tighten recordkeeping
requirements.
• Food import shipments would have to be accompanied by
documentation that they meet safety standards that are at least
equivalent to U.S. standards.
– Certifications might be provided by governments or other accredited
third parties.
• Consider the Consumer Product Safety Improvement Act a model.
Likely Importer (Customer) Demands
• Buyers want to know how product is being handled,
whether chemicals or antibiotics are used.
• Buyers want a written record of inspections and other
steps taken or tests administered to ensure the safety
of seafood and other food products.
– What systems do you have in place to remove unsafe
product?
– What systems do you have to trace product after it
leaves your plant?
• If you use third party laboratories, how are they
accredited?
• Buyers may demand that inspection information be
included on the commercial invoice.
U.S. Regulation of Catfish -- Basa and Tra
• Brenda A. Jacobs
Sidley Austin LLP
1501 K Street, NW
Washington, D.C. 20005
202-736-8149 direct
202-736-8711 fax
email: bjacobs@sidley.com