Importer unconcerned about changing FDA inspection costs

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The Food and Drug Administration is about to embark on what one critic is calling a huge “money grab” from food importers, but at least one importer said he’s unconcerned about the change in regulations.

The Food and Drug Administration is about to embark on what one critic is calling a huge “money grab” from food importers, but at least one importer said he’s unconcerned about the change in regulations.

Benjamin England, founder and CEO of the consulting firm FDAImports.com, said the agency has expanded the definition of imported food inspections past its legal jurisdiction in order to collect fees authorized by Congress in the Food Safety Modernization Act. England started a coalition to collect official comments from importers to send to the FDA.

On Oct. 1, the FDA will begin charging $224 per hour for domestic second inspections of food imported from manufacturers that have been placed on the “import alert” list. What concerns England is that, under the FDA’s definition of inspection, the agency can charge the reinspection fees for food that was not physically inspected on initial entry to the United States.

According to the notice published Aug. 1 by the FDA, the new fees are intended to cover all costs associated with reinspecting facilities, reinspecting foods and the cost to compel mandatory recalls when manufacturers do not comply with regulations.

“It covers events and circumstances where the FDA has to admit that it never looks at the food,” England said, who spent 17 years with the FDA and served as the regulatory counsel to the associate commissioner for regulatory affairs. “The definition is so broad, it covers many, many more food imports than I think the lay of the statute gives the FDA the authority to collect the fee for.”

The agency was under a directive by Congress to create a set of guidelines to reduce the impact of the fees on small businesses, but the FDA was unable to come up with the guidelines in time before the fiscal 2012 fees were announced. According to the regulation notice, the FDA will implement small-business guidance for fiscal 2013, and will review requests for fee reductions and waivers from small businesses for 2012.

“Anyone can participate in the rule-making process by commenting in writing on rules FDA proposes,” Tamara Ward, FDA spokeswoman, said via e-mail. “When a comment is received, it is logged in, numbered and placed in a file for that docket. It then becomes a public record. FDA is accepting comments to this document and intends to consider such comments in implementing these user fees in FY 2013.”

New Jersey is home to many small-scale food importers; England says he has heard from businesses concerned about the fees, but declined to name them.

Jack Wieseneck, import traffic manager for Rema Foods Inc., part of the Food Import Group conglomerate in Englewood Cliffs, said he was not too concerned about the impending fees, because they “do not have much application” to Rema’s business.

Wieseneck said the canned food Rema imports is subject to FDA inspection, but the only cost his company sees are drawing samples for random testing.

If the FDA finds fault with a Rema product, Wieseneck said, “we don’t have them reinspect it. We have to then accept that as the final ruling, and the exporter destroy the product,” or go through the submission process again.

If the supplier wants to resubmit the product, the supplier would pay for the reinspection fees, lab testing and other evidence supplied for the FDA.

“This is very rare that this happens,” Wieseneck said. “Most of the time when you have these kinds of situations … these extra costs are borne by our suppliers.”

But England says this will “be a pretty shocking cost to most food importers,” because a much larger number of importers will be charged, and because the FDA can include charges for looking over data, third-party lab tests and billing under the re-inspection fees.

The FDA can use any information that traces a food-safety incident back to a particular company as a first inspection, and add that company to the import alert list. There are about 7,500 foreign food manufacturers and exporters on the alert list that have been tagged for safety violations. England says any company that imports food from a flagged company will have the next shipment reinspected, which could take anywhere from hours to weeks, making the shipments more expensive.

“The FDA is emphasizing the idea of inspection as being the way to control risk,” England said. “You’re going to increase the cost of food, you’re going to put small businesses out of business … you’re not really going to get that much impact on safety.”

Calls and e-mails to the FDA were not returned in time for publication.