Vol. 148, No. 7 — February 15, 2014

Regulations Amending the Food and Drug Regulations (Mechanically Tenderized Beef)

Statutory authority

Food and Drugs Act

Sponsoring department

Department of Health

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Executive summary

Issues: Recent events of food-borne illness derived from mechanically tenderized beef (MTB) have underscored the need for consistent and enhanced food labelling to provide consumers with information to support the identification of MTB products and provide instructions for safe cooking.

Description: The proposed Regulations would amend the Food and Drug Regulations by introducing the following elements: a definition of MTB, a requirement that all MTB sold in Canada be labelled clearly with information that it has been mechanically tenderized and safe cooking instructions.

Cost-benefit statement: The proposal would provide a net benefit of an estimated $418,800 over a 10-year period. Based on a 95% rate of coverage, (see footnote 1) a one-time compliance cost, estimated to be $114,700, would be attributable to label changes. Further, clear safe cooking instructions on the label would provide consumers with important information to prevent food-borne illnesses, monetized at about $110,800 annually.

“One-for-One” Rule and small business lens: The “One-for-One” Rule would not be applicable, as most, if not all, of the incremental costs associated with the proposal would be considered compliance costs.

Based on data from Industry Canada, there are an estimated 815 slaughterhouses and meat processing facilities (excluding those for poultry) in the country, of which small business constitutes 93% and 98% of the business sectors. The assessment on the number and activities of food retailers is underway as data is currently limited. Preliminary indicators suggest that small business would also dominate the food retail sector.

Overall, the estimated incremental cost to industry would not be substantial. Nevertheless, the small business lens would still apply due to the demographic nature of the industry.

Domestic and international coordination and cooperation: This proposal focuses on MTB sold in Canada. All MTB imported into Canada must comply with the requirements under the Meat Inspection Act and its Regulations. Coordination and cooperation will focus mainly on enforcement activities with the Canadian Food Inspection Agency.

Background

In 2012, 18 cases of food-borne illness caused by Escherichia coli O157 (E. coli O157) were reported as part of a Canadian outbreak associated with contaminated XL Foods Inc. beef. During the food safety investigation following the outbreak, several cases were considered to be likely associated with the consumption of mechanically tenderized beef (MTB) produced at the retail level. Health Canada decided to initiate a risk assessment of MTB and to make known recommendations concerning the handling of MTB.

Mechanical tenderization of meat is a common practice and has been used by processors, food services and retailers for many years to improve the tenderness and flavour of cooked beef. The process of mechanically tenderizing meat involves using instruments such as needles or blades to break down, penetrate or pierce its surface, or injecting it with a marinade or tenderizing solution. It is not apparent by just looking at the meat product whether it has undergone this process. Further, this process can increase the risk posed to consumers if the surface of the meat is contaminated with bacteria, which can then be transferred from the surface to the centre of the meat during tenderization. This contamination can also occur at home, as tenderizing tools intended for home use are also available to Canadian consumers.

Following the 2012 outbreak, Health Canada along with the Public Health Agency of Canada released an interim recommendation encouraging Canadians to cook mechanically tenderized steak and beef cuts to an internal temperature of at least 71°C (160°F). There is now new scientific research specific to MTB that supports new cooking recommendations to achieve better protection for consumers of MTB products. These include cooking MTB products to a minimal internal temperature of 63°C (145°F) and flipping steaks at least twice during cooking to achieve a consistent temperature throughout.

An independent review of the XL Foods Inc. beef recall (Independent Review of XL Foods Inc. Beef Recall 2012) was conducted and concluded in 2013. The review included a recommendation to Health Canada to complete its risk assessment of MTB and make known its recommendations concerning the handling of MTB products.

In May 2013, Health Canada completed the health risk assessment on E. coli O157 in MTB. The results from the assessment showed a fivefold increase in risk from MTB products when compared to intact cuts of beef. The presence of the E. coli O157 strain is known to make people sick, causing severe stomach cramps, diarrhea and vomiting. Furthermore, serious complications of an E. coli O157 infection can include kidney failure. The assessment also identified that without labels, it is difficult for Canadians to identify which products have been mechanically tenderized.

The health risk assessment, Findings of the Health Risk Assessment of Escherichia coli O157 in Mechanically Tenderized Beef Products in Canada, which was published on May 28, 2013, is available at the following Web site: www.intechopen.com/ journals/international_food_risk_analysis_journal/findings-of-the- health-risk-assessment-of-escherichia-coli-o157-in-mechanically- tenderized-beef-prod.

On May 17, 2013, as part of the Safe Food for Canadians Action Plan, the Government of Canada announced plans to implement mandatory labelling requirements for all MTB products sold in Canada. Following this announcement, the CFIA amended its Meat Hygiene Manual of Procedures (MOP) under the Meat Inspection Regulations, 1990 (MIR) to mandate federally registered plants that produce MTB cuts to label those products as “mechanically tenderized” and provide cooking instructions. Consequently, federally registered processors and many national retailers are complying with the requirements, but non-federally registered processors and small grocery retailers, including butcher shops are not included. The proposal is intended to bridge this regulatory gap.

In addition, the Minister of Health released the Healthy and Safe Food for Canadians Framework, which outlines how the Government is working to inform consumers about healthy and safe food choices, to minimize food safety risks, and to protect Canadians when unsafe foods enter the marketplace. The regulatory proposal is part of this work, as it will provide the information Canadians need to make informed decisions and promotes safe food preparation.

Internationally, the United States Department of Agriculture – Food Safety Inspection Service (USDA-FSIS) announced on June 10, 2013, a regulatory proposal to require the use of the descriptive designation “mechanically tenderized” on the labels of mechanically tenderized beef products. The proposed regulations also require that cooking instructions be provided to consumers on the product label.

The United States appears to be the only country to indicate a mandatory cooking temperature specific to MTB and the only other country to propose a requirement for MTB labelling with cooking instructions.

Issues

Recent Canadian events of food-borne illness associated with E. coli O157 contamination in MTB products have identified the need for enhanced food labelling. Such labelling would provide consumers with information to support identification of MTB and instructions for safe cooking.

Following these outbreaks, Health Canada conducted a health risk assessment. The results indicated that there is a fivefold increase of risk from MTB products when compared to intact cuts of beef and that without proper labeling it is difficult for Canadians to identify which products have been mechanically tenderized.

Currently, the CFIA has authority over the federally registered processors under the MIR that requires mandatory labelling of MTB. However, a consumer may purchase meat products at the retail level that come from sources other than a federally registered meat processing facility, and meat products can also be further processed, cut, tenderized and packaged at a retail level or by non-federally registered processors. Hence, these products are not subject to the rules under the mandatory labelling requirements of MIR.

Objectives

The objectives of the proposal are to assist consumers in identifying MTB products and to provide them with safe cooking instructions to help minimize the potential risk of food-borne illness.

This proposal furthers commitments the Government has made under the Safe Food for Canadians Action Plan and the Healthy and Safe Food for Canadians Framework, which support consistent labelling of all MTB products sold in Canada with important information for Canadians to make informed decisions and promote safe cooking.

This proposal would also bridge a gap between the labelling requirements for federally registered and non-federally registered facilities for MTB products, and will bring a consistent approach to managing the potential risk of food-borne illness associated with all MTB for Canadians.

Description

The proposed Regulations would amend the Food and Drug Regulations (FDR), Part B Foods, to

The proposed amendments would come into force three months after publication in Part II of the Canada Gazette.

Regulatory and non-regulatory options considered

Regulatory option
Mandatory labelling

The regulatory amendment to the FDR to mandate labelling of all MTB products is considered the instrument of choice, as there is no means to enforce compliance with the current voluntary standards. As MTB products cannot be identified by consumers without clear labelling, mandatory labelling will provide important safe cooking instructions on packages.

Further, without mandatory labelling there would be an inconsistency in how the food safety rules are applied to federally registered and non-federally registered facilities, which would make the Canadian food safety system vulnerable.

Non-regulatory option
Voluntary labelling — Non-federally registered facilities

The non-regulatory option of voluntarily labelling would apply only to non-federally registered facilities, given that federally registered facilities are now required to label according to the recently amended MOP. This option would not address the inconsistency in food safety rules for federally registered and non- federally registered facilities that provide the same food product.

Health promotion and prevention efforts — Public health notices and consumer education efforts

There are federally supported programs to educate consumers about health risks. For example, Health Canada and the Public Health Agency of Canada have published recommendations regarding the safe cooking of meat products. Most Canadian consumers would become aware of such recommendations and public health notices mainly through the media. However, this does not have the same effect as important safety information provided on the product label itself that is visible to the consumer each time a product is selected for purchase. Also, in comparison with education efforts for products that consumers can easily recognize, such as ground meats, promotion and prevention efforts for MTB are not currently effective because consumers cannot easily identify the products in the marketplace in the absence of labelling.

Benefits and costs

Cost-benefit statement

Quantified impacts

 

Base Year

Final Year

Total (PV)

Annual Average

Benefits

Health care system — reduction of illnesses

$110,800

$110,800

$533,500

$110,800

Cost

Label change for non-federally registered facilities

$114,700

$0

$114,700

$16,500
(see footnote 2)

Net benefits

$418,800

$94,300

Qualitative impacts

  • • Industry should benefit from reduced risk for the number of recalls (see footnote 3) relating to tenderized beef products, which may be rare in occurrence but could be significant in financial impact, particularly for small businesses;
  • • Canadians would benefit from the proper cooking instructions and temperature information for MTB to reduce the possibility of food-borne illnesses; and
  • • Consumers would gain from the transparency provided by the label requirement to make informed choices about beef products.
Benefits
Canadian consumers

The regulatory proposal would benefit Canadians. First, it would provide the necessary information to consumers regarding proper cooking instructions for tenderized beef products. Second, it would provide transparency and help consumers to differentiate between cuts of beef that have been tenderized from those that have not, which would facilitate informed choice.

Industry

The regulatory proposal should reduce the number of recalls (see footnote 4) for tenderized beef products, which may be rare in occurrence but could be financially significant, particularly for small businesses.

Health care system and the provincial and territorial governments

An analysis carried out by the USDA-FSIS for a similar proposal in the United States estimated that the MTB labelling proposal would prevent 460 cases of food-borne illnesses, with a lower bound of 133 and an upper bound of 1 497 cases annually in the United States. (see footnote 5) In monetary terms, this represents an expected benefit of $1,511,000 with a range of $121,000 to $11,641,000.

Taking into account consumption patterns and a population of approximately 10% of the U.S. population, a similar proposal in Canada could reduce by 34 the number of cases of food-borne illnesses annually, with a lower bound of 10 and upper bound of 110 cases. In monetary terms, this could translate into an expected value of $110,800, with a range of $31,000 to $361,000 for Canada.

As the provincial and territorial governments are primarily responsible for managing the health care system, they would also be the major recipients of any benefits from illness prevention.

Cost
Industry
Meat processing facilities engaged in beef tenderizing

Based on Industry Canada data, there are approximately 815 slaughtering houses and meat processing facilities in Canada (excluding those for poultry). The proposal would have a different impact on beef processing facilities depending on whether they are federally registered or not.

There are approximately 426 federally registered facilities, of which 41 conduct beef tenderizing activities. (see footnote 6) As federally registered facilities are already required to label mechanically tenderized products under the CFIA’s MOP, there would be no incremental cost to these establishments. Furthermore, the nil cost implication would extend to beef importers since they must be federally registered, and imported meat would be required to be labelled according to Canadian requirements. Federally registered facilities consist of comparatively larger establishments with national distribution capacities.

Conversely, non-federally registered processing facilities operate solely within provincial borders and are not required to meet the label requirement under MOP and may experience the incremental cost as a result of this proposal if they engage in tenderizing beef. These facilities are mostly smaller establishments registered and inspected provincially and can only sell their products within provincial borders.

It is estimated that there are approximately 389 non-federally registered establishments (see footnote 7) in Canada. Because meat processing is typically a business with a high volume–low profit margin, smaller enterprises potentially need to find a niche market, where there is not a significant volume to attract the bigger rivals, to maintain reasonable profit margins to survive.

Given that tenderized beef has been estimated to range between 20 to 37% of overall beef production, it would not fall under the low volume category.

If the same ratio of meat processors were engaged in tenderizing beef at the provincial level as at the national level, the estimated number would be 37 facilities. (see footnote 8)

The United States (the USDA-FSIS) estimated that the cost per label change is $310 and assumed that 10 labels per affected business would require change.

The estimated cost for label change seems reasonable in light of computer and printing technological advancements. For example, an electronic scale with label printing capability requires minimal intervention to accommodate label change. Nevertheless, this would apply only to those establishments with sufficient volume to justify and afford the investment. Further consultations, in particular with small businesses, will be needed to determine the circumstances of establishments.

If the U.S. calculation is applied to the non-federally registered facilities in Canada, assuming 37 establishments are engaged in tenderizing beef, the one-time incremental cost would be about $114,700. (see footnote 9)

Retailers

Grocery retailers could vary in size from multinational and national chain stores to local butcher shops, with various cost structures.

There are at least three scenarios to consider for retailers:

According to the U.S. report titled Expert Elicitation on the Market Shares for Raw Meat and Poultry Products Containing Added Solutions and Mechanically Tenderized Raw Meat and Poultry Products, 5% of mechanically tenderized or enhanced beef products were packaged in retail operations.

Due to the lack of data available at this time, Health Canada cannot estimate the number of retail facilities that would engage in the packaging or repackaging of tenderized beef products. However, the Department has initiated consultations with the appropriate stakeholder groups for their input on the incremental costs to retailers.

Government

The CFIA would enforce the MTB labelling requirement as part of its existing food labelling enforcement activities.

The full cost-benefit analysis is available upon request.

“One-for-One” Rule

The “One-for-One” Rule does not apply to this proposal, as there is no change in administrative cost to business.

Small business lens

Based on data from Industry Canada, there are an estimated 290 slaughtering houses and 525 meat processors in Canada, of which small business constitutes 93% and 98% of the respective business segments.

The assessment of the number and activities of food retailers is underway.

Preliminary indicators suggest that small business would also dominate the food retail sector.

Thus, the estimated incremental cost to industry may not be significant; the small business lens would nevertheless apply because of the demographic nature of the industry.

Further, larger association members representing non-federally registered processors and retailers have been made aware of the Department’s intent to improve labelling for MTB, through invitations to consultations, the Government’s recent announcement and amendments to the CFIA’s policies regarding mandatory labelling for federally registered processors in July 2013.

Regulatory flexibility analysis statement

The initial option considered would require all businesses to comply with labelling requirements three months following publication of the present Regulations in the Canada Gazette, Part II.

A flexible alternative option would be a further delayed implementation period of six months or longer for all industry. However, due to food safety concerns, a shorter implementation period was determined. In addition, the primary cost would be associated with new labelling activities, which may not be significantly reduced by deferring implementation.

In addition, minimizing administrative or compliance costs for small businesses cannot be at the expense of the greater health and safety concerns of Canadians. For this reason, the Department has not chosen the flexible alternative option and is proposing implementation three months after publication of the present Regulations in the Canada Gazette, Part II.

Consultation

Prior to the Government of Canada announcement on May 17, 2013, Health Canada held meetings with key stakeholders, such as the Canadian Restaurant and Foodservices Association (CRFA), the Canadian Meat Council (CMC), the North American Meat Association (NAMA), the Canadian Federation of Independent Grocers (CFIG) and the Retail Council of Canada (RCC). The discussion included requiring mandatory labelling requirements for MTB and gathering information on the various stakeholder opinions on this path forward. Most stakeholders were supportive of mandatory labelling if Health Canada determined it contributed to consumer health and safety.

An association representing small grocers and retailers opposed the mandatory labelling option, as it felt there was a disproportionate impact on its members. The association suggested the option of counter signage or a voluntary policy instead.

On June 6, 2013, Health Canada held a meeting with meat and microbiology experts, including representatives from academia (Kansas State University), industry (the Canadian Cattlemen Association [CCA], the CMC, the RCC, the CRFA, and the CFIG) as well as both American and Canadian government bodies (the USDA, the CFIA, and Agriculture and Agri-Food Canada [AAFC]) to discuss the factors which would need to be considered in making potential cooking recommendations for MTB.

On July 24, 2013, Health Canada held a meeting regarding the mandatory labelling of MTB with various meat and microbiology experts and stakeholders to discuss the proposed labelling options and any issues. This meeting included representatives from the CFIA, AAFC, the CMC, the RCC, the CRFA, the NAMA, as well as academic experts from the University of Manitoba, Alberta and British Colombia. The attendees were presented with proposed options and were asked to provide their input. The following is a summary of the input received:

Most recently, in early December 2013, Health Canada contacted the key stakeholders (the CCA and AAFC) involved with recent scientific studies which tested the effects of various cooking procedures on contaminated steaks. Health Canada has confirmed with the CCA that its study concludes that turning over steaks during cooking greatly assists in achieving a consistent temperature throughout the steak.

As a result of these consultations, Health Canada narrowed down the number of proposed label text options and revised proposed wording.

Regulatory cooperation

As this proposal focuses on labelling for MTB sold in Canada, regulatory cooperation will mainly be related to enforcement activities with the CFIA. The proposal will also support initiatives under the Safe Food for Canadians Action Plan regarding consistent application of MTB labelling requirements across federally and non-federally registered sectors.

The proposal would potentially align efforts, and minimize any regulatory differences, with the mandatory MTB labelling efforts underway in the United States.

Rationale

Mandatory labelling for MTB will help to address ongoing concerns regarding incidences of food-borne illness in Canada. It will address the lack of transparency for consumers regarding information on identifying MTB products and provide important safe cooking instructions, which has been identified by the Government and industry partners as a preferable risk management option.

Although voluntary guidelines are available, there is no incentive for the non-federally registered sector to follow them and no means for the federal government to enforce compliance.

Implementation, enforcement and service standards

Health Canada is proposing a three-month transitional period for the coming into force of the proposed amendments.

These proposed amendments do not alter existing compliance mechanisms under the provisions of the Food and Drug Act (FDA) and its Regulations or other applicable food-related legislation enforced by the CFIA.

Consumer education and awareness efforts will be a part of the implementation strategy in order to inform consumers that the nature of MTB is not the same as that of an intact cut of beef, and the consequence of the tenderization process may include the intake of bacteria. MTB may therefore carry a higher risk than intact products and should be cooked to a minimum internal temperature of 63°C.

Performance measurement and evaluation

Health Canada is proposing a three-month transitional period for the coming into force of the amendments following final approval. This delayed implementation period is intended to provide time for industry to plan for and adjust to the new regulatory requirements.

Health Canada will develop guidance documents and make them available to aid regulated parties to be in compliance.

These amendments would not alter existing compliance mechanisms under the provisions of the FDA and its Regulations or other food-related legislation enforced by the CFIA.

Contact

Dionne Saul-Hamilton
Office of Legislative and Regulatory Modernization
Policy, Planning and International Affairs Directorate
Health Canada
1600 Scott Street, Holland Cross
Tower B, 5th Floor
Address Locator: 3105A
Telephone: 613-960-6851
Fax: 613-941-7104
Email: LRM_MLR_consultations@hc-sc.gc.ca

PROPOSED REGULATORY TEXT

Notice is given that the Governor in Council, pursuant to section 30 (see footnote a) of the Food and Drugs Act (see footnote b), proposes to make the annexed Regulations Amending the Food and Drug Regulations (Mechanically Tenderized Beef).

Interested persons may make representations concerning the proposed Regulations within 30 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice, and be addressed to Dionne Saul-Hamilton, Regulatory Project Manager, Office of Legislative and Regulatory Modernization, Health Products and Food Branch, Department of Health, Postal Locator: 3105A, Holland Cross, Tower B, 5th Floor, 1600 Scott Street, Ottawa, Ontario K1A 0K9 (fax: 613-941-7104; email: LRM_MLR_consultations@hc-sc.gc.ca).

Ottawa, February 6, 2014

JURICA ČAPKUN
Assistant Clerk of the Privy Council

REGULATIONS AMENDING THE FOOD AND DRUG REGULATIONS (MECHANICALLY TENDERIZED BEEF)

AMENDMENTS

1. Subsection B.01.001(1) of the Food and Drug Regulations (see footnote 10) is amended by adding the following in alphabetical order:

“mechanically tenderized beef” means uncooked solid cut beef that is prepared in any of the following ways:

2. The Regulations are amended by adding the following after section B.14.021:

B.14.022. No person shall sell mechanically tenderized beef unless

COMING INTO FORCE

3. These Regulations come into force three months after the day on which they are published in the Canada Gazette, Part II.

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