New U.S. Food-Safety Measures Will Impact Consumers & Private Brand

Act will impact manufacturers with sales over $500,000, as well as Private Brands

The FDA Food Safety Modernization Act, expected to be signed into law shortly by President Obama, will set the bar higher for food manufacturers, processors and importers, as well as retail of Private Brand owners, according to attorney Janice Lai, a partner in LeClairRyan‘s Hartford office.  Among other things, the legislation is aimed at giving the Food and Drug Administration the power to mandate food recalls involving fruit and vegetable products, while setting new food safety standards for manufacturers and food processors, and requiring the industry to better track shipments.

“This is positive legislation that balances the interests of both the consumer and food manufacturer,” says Lai, an experienced litigator who focuses her practice on product liability, food litigation insurance defense, and complex civil litigation.  “The bill ensures that contaminated foods, as well as those containing unwholesome or adulterated ingredients, do not reach consumers and grocery shelves.”

Currently, the FDA “has no authority to recall foods,” Lai notes. “They can make recommendations for recalls, but cannot mandate one. With passage of the FDA Food Safety Modernization Act, they will have that power.”

The legislation requires manufacturers and food processors to evaluate and identify food safety hazards in their facilities, implement preventive controls, and document those measures to the FDA, she says. The legislation also gives the Health and Human Services (HHS) Secretary greater ability to track and trace foods.

“If someone does become sick—and approximately 325,000 people are hospitalized with a diagnosis of food poisoning every year—the Act will allow HHS to more easily and quickly track and trace the source of the contamination,” Lai explains. “In formulating the regulations, the HHS Secretary will work with the food industry, the Secretary of Agriculture and representatives of state departments of agriculture in pilot programs to develop product tracing programs to more effectively identify recipients of the food to prevent or mitigate food borne illness outbreaks.”

The legislation also allows the FDA to have the resources to conduct more frequent inspections of facilities and articles of food imported into the United States.  “Imported foods not meeting the new FDA requirements for food safety will be refused entry into the country,” Lai advises. “These requirements will have far-reaching impact beyond the borders of the United States, extending all the way back up the supply chain to countries like China and India and the rest of the world.”

Meanwhile, retailers selling Private Brand food products governed by the Act will be required to perform risk-based foreign supplier verification indicating that the imported food is in compliance with new FDA requirements and is not adulterated or misbranded, Lai adds. “Under the Act, private label retailers are required to provide the HHS Secretary with certification from an accredited certification entity or other assurances that their foreign-supplied food products are FDA compliant,” she says.  “The Secretary can refuse entry of imported foods whose certification or assurances are not deemed valid or reliable.

“Although domestic suppliers governed by the Act have an independent duty to ensure that they are compliant with the new FDA requirements,” Lai continues, “private label retailers doing business with these domestic suppliers should also make their own determination that their suppliers are indeed compliant, such as asking to see a current registration with the FDA as defined under the Act.”

U.S. manufacturers and food processors operating their own farms and plants overseas are also subject to the requirements of the Act.  The legislation empowers the HHS Secretary to enter into agreements and arrangements with foreign governments to facilitate inspections of foreign facilities registered with the FDA and permits the Secretary to direct resources for inspection of foreign facilities, suppliers and food products determined to be high-risk.  Foods from foreign factories, warehouses and establishments registered with the FDA where the owner or operator refuses inspections by United States inspectors or others designated by the Secretary won’t be permitted into the United States.

Exempted from oversight are food manufacturers and processors with annual sales of less than $500,000 who sell directly to consumers or restaurants within 275 miles of the production site. “But there are many manufacturers with sales between $500,000 and $1.5 million,” Lai notes. “The unknown at this time is the extent to which these people will be impacted in terms of costs to comply with the new FDA requirements.”

The Act also leaves questions as to how the FDA will enforce some of the new requirements.  To prepare for compliance, Lai advises manufacturers and food processors to begin looking at their processes, determine what safeguards are already in place, and what needs to be implemented to ensure better food safety.



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Christopher Durham

Christopher Durham is the president of My Private Brand and the co-founder of The Vertex Awards. He is a strategist, author, consultant and retailer who built brands at Delhaize-owned Food Lion, and lead strategy and brand development for Lowe’s Home Improvement. He has consulted with retailers around the world on their private brand portfolios including: Family Dollar, Petco, Staples, Office Depot, Best Buy, Metro (Canada), TLW (Taiwan) and Hola (Taiwan).

Durham has published five definitive books on private brands, including his first book, Fifty2: The My Private Brand Project. In 2017, he will debut his newest book, Vanguard: Vintage Originals, a visual tour of innovation and disruption in private brand going back to the mid-1800’s.
Dynamic in his presentation while down to earth and frank in his opinions, he has presented at numerous conferences, including FUSE, The Dieline Conference, Packaging that Sells, Omnishopper and PLMA’a annual trade show in Chicago.

Durham lives in Charlotte, NC with his wife, Laraine, and two daughters, Olivia and Sarah.