BOSTON -- While retailers may shift the burden of labeling products by country of origin onto suppliers, enforcement of the new COOL rule will take place at the retail level, officials with the U.S. Department of Agriculture and National Fisheries Institute said during a seminar at the International Boston Seafood Show.
Retailers will have to keep a complete paper trail at their fingertips in the event of an audit, officials said, noting that authorities could ask store representatives at any time to provide documentation verifying a product's originating country.
Scheduled to take effect by Sept. 30, 2004, the mandatory COOL rule requires fresh domestic and imported fish, meats, produce and peanuts to bear labels informing consumers of the product's country of origin. Largely unpopular among food industry leaders, who believe the rule will be cumbersome and costly, the labeling law was passed last year as part of the 2002 Farm Bill. Currently, participation is voluntary, and officials noted the final regulation itself is not complete. However, they offered retailers and other members of the seafood industry the latest guidelines, and a general overview.
"Our enforcement will begin at the retail market," said Barry Carpenter, deputy administrator, Livestock and Seed Program of USDA's Agricultural Marketing Service. "We'll look at the product, check the label, look at the in-store documents to verify the country of origin.
"The retailer must demonstrate they labeled it right, and demonstrate where they bought the product," he said, noting retailers should keep records for two years. "You must convince an auditor you have a chain of custody. There must be documentation to take us from point to point."
Certain aspects of the rule are unique to the seafood industry. For instance, in addition to a country-of-origin label, seafood items also will have to be labeled "wild" or "farm raised." Fully cooked products such as seafood salads, clam chowder and sushi -- anything that could be labeled ready-to-eat -- are exempt. The rule also doesn't apply to restaurants and other food-service establishments.
When asked how retailers should label live products, such as lobsters sold in tanks, Barry suggested managers would do well to avoid co-mingling like products from different countries. "I'm hearing people say segregate them," he said.
Consumers could see the names of multiple countries on certain foods. For example, if a fish is hatched in Canada and processed in the U.S., the product labels would have to indicate those facts, he said. Identifying only one country on the label would not be appropriate.
To be labeled a product of the U.S., farm-raised fish or shellfish would have to be derived exclusively from fish or shellfish hatched, raised, harvested and processed in this country. For wild fish and shellfish, products would have to be derived exclusively from fish or shellfish harvested in U.S. waters, or by a U.S.-flagged vessel, and processed in this country or aboard a U.S.-flagged vessel. On imported products, U.S. Customs will determine where the product is from, the speakers said.
Retailers who willfully mislabel products could face penalties, but only if there was evidence indicating they were aware of the false labels. Violations may result in a fine of $10,000 per offense, and would apply to both retailers and suppliers. The USDA will partner with state agencies to carry out enforcement action.
American producers who want to differentiate their foods from imported products are proponents of the rule, said Justin LeBlanc, vice president of government relations for the Arlington, Va.-based National Fisheries Institute. He predicted authorities will concentrate enforcement on violators who falsely claim their products are made in the U.S.
"I don't suspect the enforcement agencies will be as concerned about, for example, a product of China being mislabeled a product of Korea," LeBlanc said. "That's fraudulent labeling as well, but I can't see it being an enforcement priority for the agencies."
He added: "I think you'll find, with the USDA's empowering of state agencies to conduct enforcement, the level and focus of enforcement will vary from state to state."