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OPN Connect Newsletter 71 · July 5, 2018

USDA cracks down on 'middlemen' in organic supply chains


by Sustainable Food News 
July 2, 2018

 

The USDA's National Organic Program (NOP) has clarified the scope of a proposed rule that it plans to roll out with the aim of fighting fraud in domestic and global organic supply chains.

Cal Organic May 2024

A spokesperson from the USDA's Agricultural Marketing Service (AMS) told Sustainable Food News that the NOP, which AMS oversees, "has identified a number of needed rule changes through its experience in administering the program, investigating complaints, and accrediting and auditing certifiers."

The "Strengthening Enforcement proposed rule" was included in the Office of Management and Budget's (OMB) Regulatory Agenda "to allow USDA to better deter fraud in the organic market, enhance enforcement, and establish a level playing field across all organic farms and businesses with respect to oversight and enforcement."

The proposed rule, which is slated for introduction by March, "would strengthen the oversight and enforcement of organic products and ensure products are meeting the organic standards. If implemented, these rule changes would support a broader strategy to strengthen oversight of the organic supply chain and organic imports."

The proposed rule would modify a number of existing areas in the USDA organic regulations, the AMS spokesperson told SFN.

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"For example, it would require middlemen (brokers, traders/marketers, and distributors) to be certified if they sell or arrange the sale of, represent, or label organic products," the spokesperson said. "It would require unannounced inspections of organic farms and businesses; require a standard organic certificate that expires each year; and clarify other labeling and accreditation/certification requirements."

The NOP will host a webinar next month to discuss the upcoming proposed rule. The webinar is set for Tues., July 17 from 1-2 p.m. ET. To access the webinar go here.

In late May, the NOP released an updated Summary of Activities and Overview Action Plan, which recommended several changes in federal organic standards to strengthen enforcement and the integrity of the organic supply chain.

At the time, NOP said it was initiating a pasture surveillance project, where it conducts unannounced visits with high risk dairies to assess compliance with the organic pasture standards.

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Other changes outlined in the Action Plan included:

  • modifying the current exclusion for uncertified handlers so that organizations such as importers and brokers must be certified requiring import certificates for incoming shipments to improve organic import oversight
  • updating regulatory requirements for trade arrangements
  • improving the ability to confirm the authenticity of organic imports before they cross the U.S. border
  • institutionalization of unannounced inspections by certifiers and USDA staff, focused on the highest risk areas
  • revision of the noncompliance, adverse action and appeals process to bring violators to justice faster while preserving due process
  • exploration of options for instituting hold-product authority

So far this year, the NOP said it has kicked in enforcement improvements including:

  • increased reporting of enforcement actions
  • increased use of risk assessments when examining incoming complaints so that program resources are invested where the market needs us the most
  • increased number of announced and unannounced inspections of complex organic businesses
  • leveraging of NOP’s relationships with other USDA offices to:
  • increase internal investigative capabilities and staffing
  • expedite administrative proceedings to suspend or revoke an operation
  • establish processes for referring complaints to the AMS Perishable Agricultural Commodities Act (PACA) group, when appropriate
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