Administration condemnation would also be authorized under H.R. 8894 and H.R. 12849.

In addition, the latter bill provides that any person who violates the act shall be subject to a fine of up to $1,000, or imprisonment up to 1 year, or both. Apparently, these sanctions could be imposed whether or not the individual officer or employee had specific knowledge or intention to commit the violative act.

THE QUESTION OF THE NEED FOR PARTICULARIZED REGULATION OF FISHERY PRODUCTS AT THIS TIME

Our purpose in describing at some length the broad range of food regulatory controls currently applicable to fishery products under existing law, and in reviewing the provisions of H.R. 887, H.R. 8894, and H.R. 12849, is to provide a meaningful background for consideration of the question whether there is a demonstrated need for the creation of an entirely new regulatory framework in a separate agency for the imposition of additional controls on the harvesting and processing of fish and fishery products.

This question itself breaks down into several component questions. (1) If it assumed that some additional controls are necessary or desirable for fishery products, is it advisable to vest such new authority in another agency so as to overlap and, in some respects, duplicate existing FDA programs?

The canning industry is not anxious to become involved in a dispute concerning which Federal agency should have jurisdiction to regulate fishery products. There would seem to be no valid reason, however, for such jurisdiction to be split between two agencies and to derive from two entirely separate laws.

A two-agency approach would create any number of problems. (a) Administrative costs would be greater; (b) inspection programs and substantive controls would conflict and overlap; (c) the status of existing FDA standards and regulations would become ambiguous, perhaps to be resolved only by litigation; (d) either too much or too little regulation could well result from the failure of the two agencies to coordinate their programs.

(2) Again, assuming that some additional controls are thought to be desirable, is it wise to grant the broad and virtually unlimited discretionary authority contained in these bills to regulatory officials?

Some aspects of these bills constitute a substantial departure from existing food controls, in that they greatly increase the discretionary power of the agency, minimize the opportunity for public participation in the development of agency positions, and reduce the power of courts to prevent arbitrary and unreasonable agency action.

Mr. DINGELL. The Chair notes with some regret that that set of bells you hear indicates a vote is going on on the floor.

It will be necessary at this time for me to leave the committee and go over and respond."

I have read your statement in detail. I think it is a very good one and very helpful.

I have to differ with you, as you might well assume, on some of the points you have raised.

The Chair will, without objection, insert your entire statement in the record at this point.

[The statement referred to follows:]

STATEMENT OF ROBERT D. NORDSTROM, DIRECTOR, FISHERY PRODUCTS PROGRAM, NATIONAL CANNERS ASSOCIATION

My name is Robert D. Nordstrom. I am Director of the Fishery Products Program of the National Canners Association-a nonprofit trade association whose members pack more than 85 percent of the national production of canned fish, fruits, vegetables, and other products.

We very much appreciate this opportunity to appear today to present the views of the fish canning industry-a major segment of the industry that would be affected by the bills under consideration. The value of the annual domestic production of canned fishery products approximates one-half billion dollars. Included in this total are such products as canned tuna, salmon, shrimp, sardines, mackerel, clams, crab, oysters, and a variety of specialty products. All of these are packed in hermetically sealed containers and sterilized by heat.

EXISTING REGULATION OF SEAFOODS

As a starting point for the consideration of Federal legislation providing for additional and particularized regulation of fishery products, we believe a basic understanding of the Federal food laws and programs that now apply to these products will be helpful.

The principal law is of course the Federal Food, Drug and Cosmetic Act, which prohibits the shipment in interstate commerce of any adulterated or misbranded food, and which is fully applicable to fish, shellfish, and other seafood products. Section 402 of that Act establishes the principal statutory basis for the regulation of adulterated foods. That Section, which applies to fish products as well as to other foods, provide that any food product which contains any poisonous or otherwise harmful ingredient, any unsafe pesticide chemical, food additive, or color additive, any filthy, putrid or decomposed substance, or any ingredient that damages the product or conceals its inferiority, shall be deemed unlawful and may not be introduced into interstate commerce.

Furthermore, fish product packed in poisonous or otherwise harmful containers and those packed under unsanitary conditions are treated in like manner. And the active Food and Drug Administration enforcement of food( and fish) product sanitation requirements has been reenforced in recent years by the issuance of FDA's Good Manufacturing Practice (Sanitation) Regulations for foods. These GMP regulations represent a broad outline of accepted sanitation practices and cover such critical subjects as "plants and grounds; equipment and utensils; sanitary facilities, controls and operations; food processing; and, personnel sanitation requirements." They have undoubtedly greatly facilitated FDA enforcement of the Act.

Food processing plants (and fish processing plants, as well) are also subject to inplant inspection by qualified FDA inspectors. The basic statutory authority for food plant inspection is Section 704 of the Food, Drug and Cosmetic Act, which provides that, upon presentation of appropriate credentials and written notice to the plant owner, operator or manager, an FDA inspector is authorized to enter any food processing plant or storage facility. The Act protects the plant owner, too, by requiring that the inspection be conducted at reasonable times, within reasonable limits and in a reasonable manner. But a "refusal to permit entry or inspection as authorized by Section 704" is unlawful and is punishable by imprisonment of up to one year or a fine of up to $1,000, or both.

Under the provisions of Section 704, the FDA inspector is authorized to inspect food processing plants and warehouses where food products (including fish products) are held or processed prior to introduction into interstate commerce. Once inside the plant or other facility, the FDA inspector may examine all food processing equipment, finished and unfinished materials, containers and labels. Plant records relating to the receipt of food products by the processor may also be checked and copied by the FDA inspector.

Thus under existing statutory authority, FDA inspectors may conduct comprehensive inplant inspections of fish processing facilities at reasonable times as often as the FDA officials feel that inspection of the particular plant is

necessary to insure compliance with minimum sanitation and processing standards.

These traditional controls have been augmented with the promulgation by the FDA-in response to a proposal by the National Canners Association-of a standby emergency permit control program under Section 404 of the FD&C Act for all low acid canned foods. The regulations established procedures to assure that canned foods are adequately processed.

Section 401 of the Food, Drug and Cosmetic Act authorizes the Secretary of Health, Education and Welfare to adopt standards of identity, quality and fill of container for food products when in his judgment such action will "promote honesty and fair dealing in the interest of consumers."

To date, such minimum standards have been adopted for canned tuna, shrimp, oysters and salmon. The canned tuna standard (which appears to 21 Code of Federal Regulations, Part 37), for example, sets forth the acceptable product ingredients (identity), minimum quality levels and minimum standards of fill of container. And FDA has the authority, under existing law, to adopt similar requirements for any other fish product, where such requirements will be in the best interest of the consumer.

Probably no area relating to food production is more thoroughly regulated than is packaging and labeling. Both the Food, Drug and Cosmetic Art and the Fair Packaging and Labeling Act provide the basis for broad Federal labeling requirements relating to product and manufacturer identity, quantity and ingredients.

Section 403 of the Food, Drug and Cosmetic Act prohibits false, misleading or deceptive labeling or packaging of any food product. Additionally it establishes minimum information requirements for food product labels. And even more stringent informational requirements were established by the Fair Packaging and Labeling Act.

Fish and fish products must thus comply with the detailed regulations which have been promulgated by FDA under the authority provided in one or both of these Federal Acts. Such regulations (which appear in 21 Code of Federal Regulations, Part 1) cover, in addition to the content of the mandatory identity and quantity declarations, such specialized areas of consumer concern as labeling of nutrients, labeling of flavors, placement and prominence of required and optional information, deceptive terminology, and permissible quantity variations due to exposure.

Thus, in summary, it may be said that under existing law, fish and fish products are subject to a wide range of Federal controls, including inplant inspection, broad sanitation and processing requirements, minimum standards of quality, identity and fill of container and detailed packaging and labeling requirements. All these are mandatory in nature, and violations may give rise to appropriate enforcement action by FDA through seizure of the product, injunction against shipment in interstate commerce, or criminal prosecution of corporate or individual violators. It should be added that criminal liability under the Food, Drug and Cosmetic Act is absolute in nature, so that responsible corporate employees may be prosecuted without a showing of specific knowledge or intent of the violative act.

In addition to this comprehensive regulation under the Food, Drug and Cosmetic Act, any fish processor selling to military purchasing agencies must undergo plant inspection by personnel of the Veterinary Corps, and must comply with comprehensive quality and sanitary standards promulgated by these agencies. All states of course administer and enforce their own food laws, and some states have programs particularly concerned with seafood products.

These compulsory inspection programs are augmented by voluntary industry efforts, undertaken by companies and associations, either independently or in cooperation with the FDA, such as the NCA-FDA Canned Salmon Plan, and the Maine Sardine Inspection Plan. The National Canners Association Research Laboratories have carried on an extensive sanitation program for many years, training company personnel and advising on individual sanitation problems. A fundamental part of the work of the NCA Research Laboratories has always included extensive research in the canning process and the establishment of processing times and temperatures for the growing number of canned products. This work is carried on in all three NCA Laboratories, one of which-located in Seattle, Washington-is devoted almost exclusively to fishery products. These quality improvement and quality assurance programs of the Laboratories indicate the emphasis the canning industry places on providing the consumer with wholesome and good quality fishery products.

41-016-74-29

SUMMARY DESCRIPTION OF H.R. 887, H.R. 8894 AND H.R. 12849

The three bills now before the Subcommittee for consideration at these hearings are H.R. 887, introduced by Congressmen Pepper and Dingell and cited as the "Fishery Products Protection Act," H.R. 8894, introduced by Congressman Melcher and cited as the "Wholesome Fish and Fishery Products Act," and H.R. 12849, introduced by Congresswoman Sullivan and Congressman Dingell and also cited as the "Wholesome Fish and Fishery Products Act." Although the three bills differ in certain respects concerning the scope and nature of the controls that would be authorized, they all envision the creation of an entirely new and additional regulatory scheme to be applicable solely to fish and fishery products. In each case the controls authorized would apparently be in addition to those presently adopted under the Federal Food, Drug and Cosmetic Act and the Fair Packaging and Labeling Act, which are applicable to fish and fishery products as well as to all other foods. H.R. 887 would vest this new authority in the Secretary of the Interior, H.R. 8894 in the Secretary of Agriculture, and H.R. 12849 in the Secretary of Commerce.

Each of the bills appears to be based on counterparts that have been introduced in previous Congresses, but each is different in some respects from the fishery inspection legislation considered during the past five years or so that would have provided for specialized regulation of fishery products by amendment of the Federal Food, Drug and Cosmetic Act. The principal provisions of these bills, with some indication of the differences among them, are summarized below.

1. Sanitary Standards and Practices.-Section 4 of H.R. 887 provides that within three years after the effective date of the Act, regulations shall be adopted by the Secretary of the Interior to prescribe "adequate sanitary standards and practices for establishments processing fish or fishery products in any State for movement in commerce and for establishments the operations of which directly affect the movement of fish and fishery products in commerce and for vessels of the United States." These regulations would become effective three years after their adoption.

Similar authority is contained in Section 6(a) of H.R. 8894 and Section 4(a) of H.R. 12849, except that the "standards of good manufacturing practices" under these bills must be adopted within one year after funds are first appropriated and become effective one year later.

Under all three bills the standards would have the force of law, and would be enforceable directly against any affected company. None of the bills spells out the procedure for adoption of the standards. Presumably the provisions of the Administrative Procedure Act would apply, but under the APA the agency would not be required to hold a hearing or base its regulations upon substantial evidence. The APA would also provide limited judicial review of the regulations, but the agency's determination could be overturned only if it was found to be arbitrary or capricious, or contrary to law.

2. Application to Fishery Imports.-Unquestionably, the overriding concern with any specialized regulation of the domestic fish processing industry is the practical inability of such legislation to address itself effectively and fairly to imports of fish and fish products. Section 4(b) of H.R. 887 provides that the Secretary shall adopt regulations to assure that imported fishery products are safe and wholesome, and that the containers of such products comply with such sanitary standards as he may prescribe. But there is no requirement that the plant and vessel sanitary standards to be applied to domestic production shall also apply to the production of imports.

Section 5(c) fully recognizes this discrepancy between the bill's application to domestic production and imports, for it provides that the Secretary of State shall "encourage" foreign countries exporting fishery products to the United States to establish enforceable sanitary standards and practices for plants and vessels processing fishery products for such exportation. Countries found to be imposing such standards and practices would be authorized to use an official inspection mark on exported products. Countries found not to be imposing such standards and practices would remain entirely free to continue to export fishery products to the United States, subject only to the requirement that the imported product must be safe and wholesome.

This discriminatory approach between domestic production and imports is particularly troublesome in view of the fact that over half the fishery products consumed in this country have a foreign origin. These imports come from over

100 countries in all parts of the world, including such countries as Canada, Japan, Mexico, the Republic of South Africa, Peru, Iceland, Norway, Spain, Portugal, Denmark, Australia, Russia, Costa Rica, Guyana, Malaysia, Kuwait, India, Pakistan, Saudi Arabia, Serra Leone, Ivory Coast, and the Canary Islands. For some products, imports far exceed fifty percent of our domestic consumption.

Thus, the importance of imports for the domestic consumption of fishery products has at least a two-fold significance. First, domestic processors must continue to compete with foreign producers who will be under no obligation to comply with compulsory sanitary standards. Second, although the premise of the bill seems to be that American consumers must be protected by increased regulatory controls--particularly sanitary standards and practices-over half of the fishery products they eat-those from abroad-need not be subject to such controls. If such controls are necessary for domestic production, then they should be just as necessary, or perhaps more so, for imports.

The provisions of H.R. 8894 and H.R. 12849 with respect to imports are apparently intended to avoid regulatory discrimination against the domestic industry. Section 6(i) of H.R. 8894 and Section 5(a) of H.R. 12849 provide that no fish or fishery products may be imported unless they comply with "all the inspection, good manufacturing practice, and other provisions" of the Act. If the Secretary determines that a foreign country has a system of plant and vessel inspection of fish and fishery products "at least equal to all the inspection, good manufacturing practice, and other provisions" of the Act, and that reliance can be placed on certificates as to compliance with the country's inspection, GMP, and other requirements, the Secretary may accept the certificate as compliance with the Federal Act.

In spite of this language, these bills provide only minimal assurance that imports would be subject to the same rigorous requirements as would be imposed upon domestic production. Many of the more than 100 countries exporting fishery products to the United States have different standards of sanitation and processing procedures. It is by no means clear that a country adopting an inspection system to maintain U.S. sales would be concerned with its continuing effective operation. Quite obviously, the more rigorously such a system is enforced, that country's exports to this country are proportionally reduced.

3. Inspection of Plants and Products.-Under Section 6(c) of H.R. 887, an inspector would have access to any plant for the purpose of determining whether the conditions of the plant's registration certificate are being complied with. There is no explanation in this Section, or anywhere in the bill, of what conditions may be imposed upon the issuance of a certificate. Section 11 of the bill provides that all fish and fishery products processed in a plant subject to the Act shall be subject to inspection and reinspection by sampling or other methods at any time.

H.R. 8894 and H.R. 12849 would require "continuous" inspection of fish plants, apparently including a requirement that inspectors be on hand at all times that a plant is in operation. The latter bill does provide that where plants are geographically remote one inspector may inspect more than one establishment. In prior years the canning industry maintained that a statutory requirement of continuous inspection would result in the inefficient use of trained manpower, wasteful effort, and unnecessary costs, and would not result in any identifiable consumer benefit. Under a more flexible approach inspection could be stepped up to the extent necessary to deal with special problems as they arose. When a company was operating well within the requirements of applicable laws and regulations, full-time inspection would be totally unnecessary and contrary to the interest of the public in the effective use of Federal funds and manpower. 4. Premarket Clearance of Labels.-Section 12(d) of H.R. 887 provides that if the Secretary determines that any label used or prepared for use is false or misleading he may order such person to discontinue the use of such label except as modified in the manner prescribed by the Secretary. The person may request a hearing, but the use of the label may be withheld by the Secretary pending a hearing and his final determination. Within thirty days after such a final determination the person may appeal to the United States Court of Appeals praying that the Secretary's order be set aside or modified. Section 6(f) of H.R. 8894 and Section 4(f) of H.R. 12849 contain similar authority for premarket clearance of packages and labels, again with discretionary power in the Secretary to prevent the use of a label pending the outcome of administrative proceedings.