Food Safety Modernization Act: Cooperative Federalism and the Impact on Latin America

BY SEAN MCCLEARY—The Food Safety Modernization Act (“FSMA”), which was passed on December 21, 2010,[1] attempts to increase food safety through cooperative federalism.  Under FSMA, the FDA will work closely with state governments and food importers to increase food inspection.[2]  Consumer interest in food safety has peaked in recent years; the CDC reports that 48 million people become ill each year as a result of contaminated food.[3]  Many outbreaks of foodborne illness are the result of foreign-grown foods.[4]  In order to help reduce food contamination, FSMA increases food inspection on both foreign and domestic food suppliers.[5]  Because of increased inspection and other regulatory compliance, foreign and domestic food suppliers will be faced with increased costs associated with inspection and compliance.  Because Latin America is a major U.S. food supplier, many Latin American food suppliers will likely face financial strain in the face of new regulations.

While FSMA has broad implications on domestic food suppliers, much of FSMA’s focus is on food importers and foreign food suppliers.  FSMA drastically expands the FDA’s inspection powers and its ability to delegate certain inspection powers.[6]  Primarily, the FDA is explicitly authorized to rely on the inspections of other federal, state, and local agencies.[7]  The delegation of inspection authority is FSMA’s attempt to create a system of cooperative federalism; in reality, FSMA displaces many State laws.[8]  Beyond government agencies, the FDA can also require food importers to certify that the food they are importing is safe.[9]  Another significant aspect of FSMA is the FDA’s power to refuse admitting food from foreign food suppliers that have refused to allow FDA inspection of their facilities.[10]  Even though foreign food suppliers are not required to allow FDA inspection, they are left with little choice; if they are unable to export foods to the U.S., they will not stay in business very long.

As Latin America is a global leader in sustainable food production,[11] U.S. import regulations may adversely affect food prices.  Latin American food producers will have to comply with a host of new regulations.  Within the first year of FSMA’s enactment, the FDA was required to inspect 600 foreign facilities, and it was required to double its inspections for the first five years of its enactment.[12]  Many Latin American food suppliers will have to invest in their facilities in order to achieve compliance.  Many Latin American countries have different and less stringent food inspection standards than those in the U.S., making it likely that many facilities will fail to meet U.S. standards unless they make improvements.[13]  Under FSMA, the FDA is supposed to work with foreign governments in order to help them improve their food inspection capabilities.[14]  If Latin American food suppliers are faced with increased costs, they will likely increase food prices in order to account for a reduction in profits.  We could begin seeing these increased food prices reflected in Argentinean beef, Brazilian soybeans, and in many of our favorite fruits and vegetables.[15]  So many of the foods that we demand thrive in specific climates found only in Latin America, so consumers may have little choice but to subsidize FSMA compliance in Latin American countries through increased pricing.

Despite increased regulation, some food importers can avail themselves of FSMA’s “Green Lane” program.[16]  Latin American importers who qualify can receive expedited review of food imports, which should substantially decrease delays in food importation.  Even though FSMA has high aspirations, it is questionable whether FSMA has the resources to achieve its goals.  FSMA was given the powers needed to force importers and suppliers into compliance; however, it was given little guidance, and even less funding.  While FSMA attempts to “work” with state and local governments, it ultimately displaces much of their authority by imposing federal regulations.