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Statement of Need: FSIS is proposing these regulations to implement the Public Health Information System (PHIS), a computer-based inspection information system currently under development. The PHIS will include automation of the export application and certification process. The current export application and certification regulations provide only for a paper-based process, this proposed rule will amend the regulations to provide for the electronic process. Additionally, this rule is needed to provide this automated services as a reimbursable certification service charged to the exporter.

Summary of the Legal Basis: The authorities for this proposed rule are: the Federal Meat Inspection Act (FMIA) (21 U.S.C. 601-695), the Poultry Products Inspection Act (PPIA) (21 U.S.C. 451-470), the Egg Products Inspection Act (EPIA) (21 U.S.C. 1031-1056), and the regulations that implement these Acts. FSIS is proposing the electronic export application and certification process as a reimbursable service under the Agricultural Marketing Act 7 U.S.C. 1622(h), that provides the Secretary of Agriculture with the authority to: “inspect, certify, and identify the class, quality, quantity, and condition of agricultural products when shipped or received in interstate commerce, under such rules and regulations as the Secretary of Agriculture may prescribe, including assessment and collection of such fees as will be reasonable and as nearly as may be to cover the cost of the service rendered, to the end that agricultural products may be marketed to the best advantage, that trading may be facilitated, and that consumers may be able to obtain the quality product which they desire."

Alternatives: The electronic processing of export applications and certifications is being proposed as a voluntary service, therefore, exporters have the option of continuing to use the current paper-based system. Therefore, no alternatives were considered.

Anticipated Costs and Benefits: FSIS estimates that it will take inspection personnel 1 hour to process an electronic application and issue an electronic certificate. Based on a workload of accessing and processing an estimated 350,000 applications/certificates per year, at a base time rate of $49.93 per hour, the cost of recouping the inspector’s labor costs for 2009 would be $17.4 million. The amount charged to the exporter depends upon the number of electronic applications submitted. The use of the electronic export application and certificate system is voluntary. Therefore, exporters will not use this service unless the benefits outweigh the cost. The electronic export application and certificate process will reduce and expedite industry workload by eliminating the physical handling and processing of paperwork. The electronic exchange of export information between the U.S. and foreign governments will help reduce the fraudulent alternation or reproduction of certificates. The electronic system will process the applications and certificates will permit exporters to move their products faster, thereby increasing the amount of revenues received at a faster rate. The electronic system will provide a streamlined and integrated method of processing export applications and certificates.

Risks: None