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From: TSS ()
Subject: Animal and Plant Health Inspection Service Oversight of the Importation of Beef Products from Canada AUDIT REPORT Report No. 33601-01-Hy
Date: February 18, 2005 at 6:57 am PST

-------- Original Message --------
Subject: Animal and Plant Health Inspection Service Oversight of the Importation of Beef Products from Canada AUDIT REPORT Report No. 33601-01-Hy
Date: Fri, 18 Feb 2005 09:01:00 -0600
From: "Terry S. Singeltary Sr."
To: Bovine Spongiform Encephalopathy

Washington D.C. 20250
DATE: February 14, 2005
ATTN OF: 33601-01-Hy
SUBJECT: Oversight of the Importation of Beef Products from Canada
TO: W. Ron DeHaven
Animal and Plant Health Inspection Service
Barbara J. Masters
Acting Administrator
Food Safety and Inspection Service
ATTN: William J. Hudnall
Deputy Administrator
Marketing and Regulatory Programs – Business Services
Ronald F. Hicks
Assistant Administrator
Office of Program Evaluation, Enforcement and Review
This report presents the results of our audit of oversight of the
importation of beef products from
Canada. Your response to the draft, dated February 9, 2005, is included
as exhibit A. Excerpts
of your response and the Office of Inspector General’s (OIG) position
are incorporated into the
Findings and Recommendations section of the report. Based on your
response, management
decision has been reached on all recommendations except No. 3. Please
follow your agency’s
internal procedures in forwarding documentation for final action to the
Office of the Chief
Financial Officer. Management decisions for the remaining recommendation
can be reached
once you have provided the additional information outlined in the report
section OIG Position.
In accordance with Departmental Regulation 1720-1, please furnish a
reply within 60 days
describing the corrective actions taken or planned, and the timeframes
for implementation of the
remaining recommendation. Please note that the regulation requires
management decision to be
reached on all recommendations within 6 months of report issuance
Assistant Inspector General
for Audit
USDA/OIG-A/33601-01-Hy Page i
Executive Summary
Animal and Plant Health Inspection Service’s Oversight of the
Importation of Beef
Products from Canada (Audit Report No. 33601-01-Hy)
Results in Brief This report presents the results of the Office of
Inspector General’s (OIG)
audit of the Animal and Plant Health Inspection Service’s (APHIS) oversight
of the importation of beef products from Canada following the detection of a
Canadian cow with bovine spongiform encephalopathy (BSE) in May 2003.
In June 2004, we initiated several actions in response to concerns raised by
four U.S. Senators that the U.S. Department of Agriculture (USDA) did not
follow appropriate safety measures, beginning sometime in the fall of 2003,
in allowing expanded Canadian beef imports into the United States. We
reviewed USDA’s actions pertaining to the importation of Canadian
products, including the use of risk mitigation1 measures.
On May 20, 2003, the Secretary halted imports of live cattle, other live
ruminants, beef, and other ruminant products from Canada after a cow in
Alberta was found to have BSE. Prior to this time, there was a free flow of
trade between the United States and Canada for live cattle and beef. Due to
the serious impact on trade, USDA officials sought a method to allow limited
imports from Canada and determined to use the APHIS permit process as a
vehicle to facilitate trade. At that time, APHIS did not have a history of
issuing permits for the importation of edible meat and meat products.
Veterinary import permits were generally issued for items derived from
animals, such as blood, cells or cell lines, hormones, and microorganisms
including bacteria, viruses, protozoa, and fungi.
On August 8, 2003, the Secretary of Agriculture (Secretary) announced a list
of low-risk products, including boneless beef from cattle less than 30
of age and veal meat from calves less than 36 weeks of age, which would be
allowed into the United States from Canada, under certain predetermined
conditions. In November 2003, USDA published a proposed rule in the
Federal Register to create a low-risk category for countries with BSE, to
place Canada on that list, and to allow imports of, among other things,
low-risk beef products and live cattle under 30 months of age to resume.
This rule for live animals and processed meat products was issued
January 4, 2005.
The Secretary’s announcement on August 8, 2003, regarding low-risk
products followed USDA’s review of the results of Canada’s epidemiological
investigation into the detection of BSE in that country. Based on the
1 Risk mitigations include such actions as certificates indicating the
product is pure liver, Canadian Food Inspection Agency (CFIA)
verification that calves were 36 weeks of age or less when slaughtered,
and CFIA verification that animals are not known to have been
fed prohibited products during their lifetime.
USDA/OIG-A/33601-01-Hy Page ii
of the investigation, as well as international guidelines2 that
indicated that
products derived from young animals do not pose a risk to human health,
USDA issued permits to allow these low-risk products into the United States.
Subsequent to the Secretary’s announcement, APHIS issued 1,155 permits3
allowing the import of a variety of products from Canada, to include many
items that had been included in the Secretary’s announcement as well as
other items that were not initially identified as allowable low-risk
In April 2004, a lawsuit was filed in U.S. District Court in Montana, which
resulted in a temporary restraining order that identified the specific
Canadian products that were eligible for import into the United States. The
list of low-risk products was the same as the list posted on August 15,
by APHIS on its website as a clarification of the Secretary’s August 8,
announcement. On May 5, 2004, the District Court converted the temporary
restraining order into a preliminary injunction. Among other things, the
preliminary injunction included an exhibit listing the specific Canadian
products that would be considered low-risk and details of required risk
To accomplish our review of USDA’s actions pertaining to the importation of
Canadian products, we interviewed officials from APHIS, the Food Safety
and Inspection Service (FSIS), and the Office of the General Counsel (OGC).
We analyzed APHIS records relating to the oversight of imported Canadian
product, to include a review of the 1,155 import permits and associated
documentation. We met with personnel from the U.S. Department of
Homeland Security’s Customs and Border Protection (CBP) in Detroit,
Michigan and Sweetgrass, Montana to understand their actions to enforce
restrictions on the importation of ruminant products from Canada. We also
visited FSIS import reinspection facilities located in Buffalo, New York;
Detroit, Michigan; and Sweetgrass, Montana. At these facilities, we analyzed
documentation on file for 12,427 shipments of ruminant products to
determine whether the product imported from Canada met APHIS
requirements. These facilities reinspected more than 646 million of the
802 million pounds of Canadian product presented for entry into the United
States between September 2003 and September 2004.
From August 2003 to April 2004, APHIS officials allowed a gradual
expansion in the types of Canadian beef products approved for import into
the United States. The expansions in product type included processed
products, bone-in product, and edible bovine tongues, hearts, kidneys, and
lips. In October 2003, APHIS allowed bovine tongues despite the APHIS
Transmissible Spongiform Encephalopathy (TSE) Working Group4
2 The International Office of Epizootics, the international
standard-setting organization for animal health, established these
3 As of September 16, 2004.
4 Created by APHIS to analyze risks of BSE to the United States,
disseminate accurate information about TSEs, and act as a reference
source for responding to questions about TSEs.
USDA/OIG-A/33601-01-Hy Page iii
conclusion in June 2003 that fresh or frozen bovine tongues were “moderate
risk” products,5 even when the required risk mitigations were in place.
bovine tongues, one of the items for which APHIS approved import permits,
were deemed as posing a “moderate risk,” and not a “low risk” by the APHIS
TSE Working Group.
The Chairperson of the TSE Working Group explained that the risk status for
bovine tongues changed from moderate to low some time between June and
November 2003, although the change was not documented prior to the
November 2003 issuance of APHIS’ “Risk Analysis: BSE Risk from
Importation of Designated Ruminants and Ruminant Products from Canada
into the United States.” The risk analysis categorized bovine tongues as
eligible product when Canadian inspection officials verify the risk
which is that tonsils are removed.
Additionally, APHIS allowed an expansion in the type of Canadian facilities
that would be allowed to produce items for export to the United States. The
gradual expansion occurred because the agency employees tasked with
administering the permit process did not consider the initial announcement
made by the Secretary to exclude products similar to those on the published
list of low-risk products, if APHIS had concluded that the products posed
similar risk levels. However, APHIS did not develop documentation to
support the agency’s conclusions that the additional products were low-risk
products. APHIS also did not have a review structure or other monitoring
process in place to identify discrepancies between publicly stated
policy and
agency practice. According to APHIS officials, they considered the initial
announcement made by the Secretary to be part of an effort to demonstrate to
the world that such trade with Canada was safe and appropriate.
Accordingly, they allowed the import of products they considered low risk in
an attempt to further that greater effort. However, APHIS did not document
the process it used to determine the additional products were low risk.
As a result of the “permit creep” that occurred between August 2003 and
April 2004, APHIS issued permits for the import of beef tongue as well as
other permits for products with questionable eligibility. Further, the
allowed the import of products from Canadian facilities that produced both
eligible and ineligible products, thus increasing the possibility that
higher-risk product could be inadvertently exported to the United States.
This practice contrasted with APHIS’ publicly stated policy that only
Canadian facilities that limited production to eligible products would be
allowed to ship to the United States. In addition, APHIS did not
5 “Recommendations of APHIS TSE Working Group for allowing certain
commodities from Canada to be imported into the United
States,” dated June 16, 2003. When required risk mitigation measures are
in place, to include various CFIA verifications, removal of
tonsils, and random sample analysis by USDA of any suspicious tissue to
confirm absence of specified risk materials, fresh and frozen
bovine tongues have a “moderate” risk.
USDA/OIG-A/33601-01-Hy Page iv
communicate its decisions to all interested parties and USDA was criticized
by segments of the public, the cattle industry, and the U.S. Congress.
APHIS issued permits to allow the import of beef cheek meat with
questionable eligibility because the agency did not establish a clear
definition for the general term “boneless beef.” Instead of coordinating
FSIS, APHIS reviewers relied upon their own understanding of the term.
Some APHIS reviewers considered the term “boneless beef” broadly, to
mean any bovine meat that did not contain a bone. Thus, some applicants
who requested permits to import beef cheek meat and other products received
permits allowing the import of “boneless beef or boneless beef trim.” As a
result, over 63,000 pounds of beef cheek meat with questionable eligibility
entered U.S. commerce from Canada.
Further, we found that FSIS did not always communicate effectively about
the eligibility status of beef cheek meat. FSIS distributed information
to its
import inspectors by way of a series of numbered memoranda, titled Part 4,
Canada, BSE Restrictions, Revision 2 through Revision 11. Some of the
issuances were supplemented by additional guidance, in the form of
supplemental memoranda. However, in our opinion, FSIS managers did not
ensure consistent interpretation of the provisions of the various
memoranda, a
factor that contributed to the entry of the previously mentioned 63,000
pounds of beef cheek meat with questionable eligibility. Because APHIS
changed its instructions to FSIS frequently and did not document the
direction provided to FSIS,6 it was even more difficult for FSIS to keep its
field staff fully apprised of the status of product eligibility.
FSIS officials did not agree that the import inspectors misinterpreted the
instructions in the numbered memoranda. Furthermore, FSIS officials
asserted that the 63,000 pounds of beef cheek meat was eligible for import
when it was imported from April to June 2004. However, they agreed that
controls should be strengthened to better communicate the eligibility of
product that frequently changed as beef cheeks did from August 2003 to
July 2004. Two FSIS import inspectors we interviewed advised us that beef
cheeks had been “going back and forth” regarding eligibility. APHIS
notified FSIS that effective July 20, 2004, beef cheek meat was not an
eligible product for import into the United States. According to APHIS
direction, beef cheek meat has not been eligible for import since
July 20, 2004. As of the date of this report, it is still not eligible
for import.
Some FSIS officials assert that the beef cheek meat was eligible product. In
contrast, the APHIS National Incident Commander for BSE Enhanced
Surveillance stated in an August 18, 2004 interview, that further discussion
was still required with respect to the import of cheek meat and that no new
6 We found that APHIS did not document its direction to FSIS prior to
April 2004 when the Ranchers-Cattlemen Action Legal Fund
(R-CALF) filed a lawsuit against USDA in U.S. District Court in Montana.
scientific information on this topic had been considered by APHIS. Given
the importance of the issues, ongoing litigation, and differences in
opinion, it would have been prudent for APHIS to write down its decisions
about the eligibility status of beef cheek meat at points in time.
However, the
agency did not do so; or did not retain such documentation for our review.
In January 2005, FSIS assessed the shipments of beef check meat and
concluded, “FSIS has no reason to believe that these four shipments7 of beef
cheek meat are injurious to health.” In its assessment, FSIS explained
that in
January 2004, the agency implemented interim final rules that prohibited the
use of specified risk materials for human food. On the matter of beef cheek
meat, the FSIS rule maintained that beef cheeks are not part of the skull,
which is a specified risk material. The FSIS rule continued to allow the use
of beef cheek meat for human food, provided that the meat is not
contaminated with specified risk materials. FSIS further supported its
conclusion on the basis that Canada had a pre-existing equivalent specified
risk material system in place. However, as previously noted, beef cheek meat
is not a product that is currently eligible to be imported into the
United States.
APHIS issued 1,155 permits for the importation of ruminant products from
Canada without ensuring that the agency had an appropriate system of
internal controls to manage the process. The APHIS permit system was
originally designed to allow for the import of research quantities
small amounts) of material into the United States. According to APHIS
officials, this permit system handled approximately 400 permit requests
annually. The procedures that APHIS had developed for handling permit
requests for small amounts of product were not adequate to deal with the
volume of requests for large quantities of commercial use beef. The agency
did not implement or finalize standard operating procedures for processing
the large volume of permits. For example, APHIS did not establish controls
to ensure that risk mitigation measures were consistently applied. We found
that 8 of the 83 permits issued for bovine liver did not include the risk
mitigation measure that the livers be from animals slaughtered after
August 8, 2003.8 We also found that APHIS did not implement requirements
to perform onsite monitoring of permit holders, Canadian facilities, or
inspection personnel9 at U.S. ports of entry. As a result, there was reduced
assurance that Canadian beef entering the United States was low-risk. Some
product with questionable eligibility, as described above, entered U.S.
USDA/OIG-A/33601-01-Hy Page v
7 The four shipments included one shipment identified by FSIS that
entered U.S. commerce in April 2004 and three shipments that we
identified that entered U.S. commerce in May and June 2004.
8 The date the Secretary of Agriculture announced that USDA would begin
to accept applications for import permits for certain low-risk
products from Canada.
9 The inspection personnel include CBP agriculture inspectors and FSIS
import inspectors.
We analyzed data for 9,953 shipments, a 100 percent review of all shipping
documents from May 2004 through September 2004, at the 4 FSIS inspection
houses that we visited. We also analyzed 11 shipments reinspected in
October 2004 by the 2 FSIS inspection houses in Sweetgrass, Montana when
we were performing onsite fieldwork. This analysis, a total of 9,964
shipments, was based on the preliminary injunction filed on May 5, 2004,
that described the ruminant products eligible to be imported from Canada.
As part of that review, we identified over 42,000 pounds of product with
questionable eligibility.
In Brief APHIS needs to institute procedures for communicating changes
in policy to
all interested parties, e.g., importers and the public, and monitoring the
consistency between agency practice and publicly stated policy. APHIS also
needs to strengthen its controls and finalize its procedures for issuing and
monitoring permits for commercial quantities of products.
We recommend that FSIS implement controls to communicate the specific
eligibility of product when its eligibility status changes. FSIS should also
implement an edit check in its import information system to identify
ineligible product presented for entry into the United States.
Agency Response APHIS and FSIS agreed with the report’s recommendations.
We have
incorporated excerpts from the agencies’ response in the Findings and
Recommendations section of this report, along with the OIG position. The
response is included as Exhibit A.
OIG Position Based on the response, we were able to reach management
decision on all of
the recommendations except No. 3.




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