usda proposed bio preferred label

8/14/2019 USDA Proposed Bio Preferred Label

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38296 Federal Register / Vol. 74, No. 146/ Friday, July 31, 2009 / Proposed Rules

1The term ‘‘designated item’’ refers to items(generic groupings of specific products that performthe same function) that have been affordedpreferred procurement by Federal agencies underthe BioPreferred Program.

DEPARTMENT OF AGRICULTURE

7 CFR Part 2904

RIN 0503–AA35

Voluntary Labeling Program forBiobased Products

AGENCY: Departmental Administration,

USDA.ACTION: Notice of proposed rulemaking.

SUMMARY: The U.S. Department of Agriculture (USDA) is proposing toestablish a voluntary labeling programfor biobased products under section9002 of the Farm Security and RuralInvestment Act of 2002, as amended bythe Food, Conservation, and Energy Actof 2008. Under the proposed labelingprogram, a biobased product, after beingcertified by USDA, could be marketedusing the ‘‘USDA Certified BiobasedProduct’’ label. The presence of the

label will mean that the product meetsUSDA standards for the amount of biobased content and that themanufacturer or vendor has providedrelevant information on the product forthe USDA BioPreferred Web site. Theproposed rule applies to manufacturersand vendors who wish to participate inthe voluntary labeling program. Theproposed rule also applies to otherentities (e.g., trade associations) thatwish to use the label to promote

biobased products.

DATES: USDA will accept publiccomments on this proposed rule until

September 29, 2009.ADDRESSES: You may submit comments

by any of the following methods. Allsubmissions received must include theagency name and RegulatoryInformation Number (RIN). The RIN forthis rulemaking is 0503–AA35. Also,please identify submittals as pertainingto the ‘‘Proposed Voluntary LabelingProgram.’’• Federal eRulemaking Portal: http://

www.regulations.gov. Follow theinstructions for submitting comments.• Mail/commercial/hand delivery:

Mail or deliver your comments to: Ron

Buckhalt, USDA, Office of the AssistantSecretary for Administration, Room 342,Reporters Building, 300 Seventh Street,SW., Washington, DC 20024.• Persons with disabilities who

require alternative means forcommunication for regulatoryinformation (Braille, large print,audiotape, etc.) should contact theUSDA TARGET Center at (202) 720–2600 (voice) and (202) 690–0942 (TTY).

You may also send comments on theinformation collection aspects of thisrule directly to the Office of Information

and Regulatory Affairs of OMB,Attention: Desk Officer for Agriculture,Margaret Malanoski, 725 17th Street,NW., Room 10202, Washington, DC20503. Comments should referenceOMB control number 0503–NEW.FOR FURTHER INFORMATION CONTACT: RonBuckhalt, USDA, Office of the AssistantSecretary for Administration, Room 342,

Reporters Building, 300 Seventh Street,SW., Washington, DC 20024; e-mail:[email protected] ; phone (202)205–4008. Information regarding theFederal Procurement Program of Biobased Products (one part of theBioPreferred Program) is available onthe Internet at http:// www.biopreferred.gov.

SUPPLEMENTARY INFORMATION: Theinformation presented in this preambleis organized as follows:

I. BackgroundA. AuthorityB. Overview of Section 9002

II. Purposes of the Voluntary LabelingProgram

III. Voluntary Labeling ProgramA. ApplicabilityB. Criteria for Obtaining CertificationC. Initial Approval ProcessD. AppealsE. Information Posted on Web SiteF. Applications for Reformulated ProductsG. Requirements Associated With the LabelH. ViolationsI. Recordkeeping Requirements

J. ReportingIV. Suggested Comment TopicsV. Regulatory Information

A. Executive Order 12866: RegulatoryPlanning and Review

B. Regulatory Flexibility Act (RFA)C. Executive Order 12630: Governmental

Actions and Interference WithConstitutionally Protected PropertyRights

D. Executive Order 13132: FederalismE. Unfunded Mandates Reform Act of 1995F. Executive Order 12372:

Intergovernmental Review of FederalPrograms

G. Executive Order 13175: Consultationand Coordination With Indian TribalGovernments

H. Paperwork Reduction ActI. Government Paperwork Elimination Act

Compliance J. Small Business Regulatory Enforcement

Fairness Act

I. Background

A. Authority

The voluntary labeling program for biobased products is proposed underthe authority of section 9002 of theFarm Security and Rural Investment Actof 2002 (FSRIA)(referred to in thispreamble as ‘‘section 9002’’), asamended by the Food, Conservation,and Energy Act of 2008 (FCEA), 7 U.S.C.8102.

B. Overview of Section 9002

Section 9002 establishes a program forthe Federal procurement of biobasedproducts by Federal agencies and avoluntary program for the labeling of

biobased products. These two programs,which are referred to collectively byUSDA as the BioPreferredSM Program,are briefly discussed below.

Federal Procurement of Biobased Products. Section 9002 requires Federalagencies to develop procurementprograms that give preference to thepurchase of biobased products (hereafterreferred to in this Federal Registernotice as the ‘‘preferred procurementprogram’’). Federal agencies and theircontractors are required to purchase

biobased products, as defined inregulations implementing the statute,that are within designated items 1 whenthe cumulative purchase price of theprocurement item(s) procured is morethan $10,000 or when the quantities of

functionally equivalent items purchasedover the preceding fiscal year equaled$10,000 or more. Each Federal agencyand contractor must procure biobasedproducts at the highest content levelswithin each designated item unless theagency determines that the items are notreasonably available, fail to meetapplicable performance standards, orare available only at an unreasonableprice.

The final guidelines for the preferredprocurement program were published inthe Federal Register on January 11,2005 (70 FR 1792). The guidelines are

contained in 7 CFR part 2902,‘‘Guidelines for Designating BiobasedProducts for Federal Procurement.’’

Part 2902 is divided into twosubparts, ‘‘Subpart A—General,’’ and‘‘Subpart B—Designated Items.’’ SubpartA addresses the purpose and scope of the guidelines and their applicability,provides guidance on productavailability and procurement, definesterms used in part 2902, and addressesaffirmative procurement programs andUSDA funding for testing. Subpart Bidentifies designated items and specifiestheir minimum biobased contents, theeffective date of the procurementpreference for biobased products withineach designated item, and otherinformation (e.g., biodegradability).USDA is responsible for designating

biobased items at the highest practicable biobased content levels for the Federalagencies’ preferred procurementprograms.

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38297Federal Register / Vol. 74, No. 146/ Friday, July 31, 2009 / Proposed Rules

As part of the preferred procurementprogram, section 9002 also requiresUSDA to provide information to Federalagencies on the availability, relativeprice, performance, and environmentaland public health benefits of productswithin such items and, as applicableunder section 9002(e)(1)(C), torecommend the minimum level of

biobased content to be contained in theproducts within a designated item.

To date, USDA has designated 33items used in a variety of applications,including cafeteria ware, personal andinstitutional cleaning products,construction products, and lubricantsand greases.

Voluntary Labeling Program. Section9002 also requires USDA to establish avoluntary labeling program under whichUSDA authorizes manufacturers andvendors of biobased products to use a‘‘USDA Certified Biobased Product’’label (hereafter referred to in thispreamble as ‘‘the label’’). The voluntarylabeling program is intended toencourage the purchase and use of

biobased products by reaching beyondthe Federal purchasing community andpromoting the purchase of biobasedproducts by the general public. Inestablishing this program, USDA mustidentify the criteria to determine thoseproducts on which the label may beused and must develop specificrequirements for how the label can beused. It is USDA’s intent that thepresence of the label on a product willmean that the labeled product is one forwhich credible factual information is

available as to the biobased content,consistently measured across labeledproducts by use of the ASTMradioisotope test D6866.

In developing the proposed voluntarylabeling program, USDA helddiscussions with other agencies thathave implemented labeling programs,such as the ‘‘ENERGY STAR®’’ programimplemented by the U.S. Department of Energy and the U.S. EnvironmentalProtection Agency (EPA). USDA hasalso consulted with representatives of the Department of Agriculture’sNational Organic program and others of

the Agricultural Marketing Service.Further, USDA consulted the FederalTrade Commission, which issues the‘‘Guides for the Use of EnvironmentalMarketing Claims’’ to ensure that theprovisions of the proposed voluntarylabeling program were consistent withthe Guides. USDA also held a publicmeeting on July 22, 2008, to seek inputon the content and use of the label fromthe public and industry stakeholders.

The following section of the preamblepresents the goal of the voluntarylabeling program and the objectives

toward achieving that goal. That sectionis followed by a summary of thevoluntary labeling program that USDAis proposing to implement under section9002(h).

II. Goal of the Voluntary LabelingProgram

USDA’s goal in proposing this

voluntary labeling program is toencourage the increased use of biobasedproducts in all market sectors. Toachieve this goal, USDA has identifiedthe following objectives:

Promotion of biobased products. Thevoluntary labeling program is intendedto promote and increase the use of

biobased products. In general, thelabeling program supports this goal byrecognizing manufacturers and vendorsthat produce and market products thatutilize biobased materials and byencouraging consumers to purchasesuch products.

Whereas the preferred procurementprogram is specific to Federal agencies,the voluntary labeling program isintended to encompass all individualsand organizations making purchasingdecisions. We are proposing that there

be two slightly different versions of thelabel, one for those biobased productsthat have been designated for Federalpreferred procurement because they arewithin a designated item, and anotherfor those products that are not within adesignated item. The label artwork forproducts within designated items wouldinclude the letters ‘‘FP’’ to indicate thatthey are Federally preferred. USDA

believes that informing consumers thatthese products have been designated forFederal preferred procurement will be

beneficial. As part of the process of designating items for preferredprocurement, USDA gathers andevaluates information regarding the

biobased product’s life cycle costs andenvironmental performance as well asfunctional performance. Thus, the ‘‘FP’’on the label will inform consumers thatUSDA has evaluated representativeproducts within the designated item andfound them to be qualified for theFederal preferred procurement program.

USDA also notes that the identificationof products that have been designatedfor preferred procurement would also beaccomplished by listing those productson the USDA Web site and in Federalprocurement catalogues.

Furthermore, the voluntary labelingprogram will increase the amount of information available to manufacturerswhose products may utilize biobasedmaterials or products as a component of their finished products or as part of their manufacturing process. USDAexpects that this increased information

will encourage these manufacturers toconsider using and/or increasing theamount of biobased materials whendesigning or manufacturing theirproducts, thereby further increasing thepurchase of biobased materials. Forexample, manufacturers of equipmentthat uses hydraulic fluids areencouraged to consider the use of

biobased hydraulic fluids if availableinformation indicates that theperformance of these fluids meets orexceeds their requirements.

Increase public awareness of biobased products. The voluntary labelingprogram will raise the visibility of

biobased products within the Federalgovernment and within the commercialmarketplace. The labeling program willalso provide a unique and identifiabledesignator recognized in the U.S. andforeign markets.

To the extent that the voluntarylabeling program achieves theseobjectives, there may be an increasedpurchase of biobased products, which isthen expected to reduce petroleumconsumption, increase the use of renewable resources, better manage thecarbon cycle, and, may contribute toreducing adverse environmental andhealth impacts. The program is alsoexpected to promote economicdevelopment for biobased productmanufacturers and vendors by creatingnew jobs and providing new markets forfarm commodities.

III. Voluntary Labeling Program

In developing the voluntary labeling

program, USDA has one primary goal—to encourage the purchase of biobasedproducts. In implementing this goal,USDA aims to ensure that only biobasedproducts that meet the criteria set forthin the voluntary labeling program arelabeled with the ‘‘USDA CertifiedBiobased Product’’ label and that thelabel is used properly. USDA believesthat products carrying the label will

become readily recognizable as biobasedproducts, distinct from those that do notcarry the label. Further, as the label willhave the percent of biobased materialprinted on it, consumers will recognize

that products carrying the label meetcertain criteria that set them apart fromother products.

A. Applicability

The proposed rule would apply tomanufacturers and vendors of biobasedproducts, as well as to other entities(e.g., trade associations, public interestgroups) that promote, sell, or use theproducts. USDA believes that each of these groups must comply with thelabeling requirements in order to ensurethat only certified biobased products





(i.e., biobased products that have beenapproved for use of the label under thisprogram) carry the label and that thelabel is used correctly. USDA believesthat the goals of the voluntary labelingprogram can be achieved, and the

beneficial impacts of the BioPreferredprogram can be increased, if manufacturers, vendors, and other

entities are allowed to market andpromote the manufacturers’ biobasedproducts with a credible biobasedproducts labeling program.

Once USDA has approved a biobasedproduct for labeling by its manufactureror vendor, an equally important aspectin ensuring the integrity of the labelingprogram is the proper use of the label.Label misuse can occur at themanufacturer level (e.g., affixing thelabel to a non-certified biobasedproduct) and at the retail level (e.g.,using the label to imply that a non-certified biobased product has been

certified), or by other entities wishing touse the label in promoting the sales orpublic awareness of non-certified

biobased products (e.g., on a Web site orin promotional materials).

While the labeling of biobasedproducts is voluntary, manufacturers,vendors, and other entities wishing touse the label in their marketing,promotional, or educational effortswould be required to comply withregulatory requirements as proposedherein. USDA believes theserequirements for use of the label arenecessary to avoid misleadingconsumers regarding whether a product

has been certified by USDA under thevoluntary labeling program.

B. Criteria for Obtaining Certification

To be eligible for USDA certificationto use the label, USDA proposes that aproduct meet two criteria, as discussed

below.Criterion 1: Biobased Product. The

product must be a biobased product.Biobased product is defined in section2904.2 of today’s proposed rule asfollows: ‘‘The term ‘biobased product’means a product determined by theSecretary to be a commercial or

industrial product (other than food orfeed) that is—(A) composed, in whole orin significant part, of biologicalproducts, including renewable domesticagricultural materials and forestrymaterials; or (B) an intermediateingredient or feedstock. For thepurposes of this subpart, the term‘biobased product’ does not includemotor vehicle fuels, heating oil,electricity produced from biomass, orany mature market products. Productsfrom a mature market will bedetermined on a case-by-case basis.’’

Rationale for Criterion 1: Asdiscussed earlier, section 9002 requiresUSDA to establish a voluntary labelingprogram under which USDA authorizesmanufacturers and vendors of biobasedproducts to use a ‘‘USDA CertifiedBiobased Product’’ label. USDA isproposing that mature market productsnot be eligible to use the label except on

a case-by-case basis. Mature marketproducts are those biobased productsthat had significant national marketpenetration in 1972. Examples of maturemarket products include cotton shirts ortowels, paper plates, and woodfurniture. USDA has excluded maturemarket products from the Federalpreferred procurement program. InUSDA’s explanation for excludingmature market products from thepreferred procurement program, USDAstated in the preamble to the finalGuidelines (70 FR 1802), ‘‘The intent of section 9002, as described in the

conference report accompanying FSRIA,‘is to stimulate the production of new biobased products and to energizeemerging markets for those products.’ ’’

Based on conference report, it is clearthat Congress did not intend for maturemarket products to be given Federalprocurement preference. It is not clear,however, whether this exclusion of mature market products was intended toapply to the voluntary labeling program.The procurement preference programand the labeling program are containedin different paragraphs of the statute,and the conference report does notspecifically state whether the language

quoted above refers to just one or to both paragraphs.

USDA believes, however, that thewidespread labeling of mature marketproducts could negatively impact theentry of new biobased products intomarket segments in which matureproducts already have significantmarket shares. Thus, USDA believesthat it is reasonable to exclude manymature market products from thelabeling program, as it has done for thepreferred procurement program. USDAis, however, proposing to allowmanufacturers of mature market

products to appeal (on a case-by-case basis) the exclusion of their productsfrom the program.

Criterion 2: Minimum Biobased Content. For a biobased product toreceive certification under this proposedrule, the biobased content of thatproduct must be at or above itsapplicable minimum biobased content,as described below. USDA believes thisrequirement is necessary so that thelabel is not used to promote productswith de minimis biobased content. Asdiscussed below, the applicable

minimum biobased content dependsunder which of the three proposedcategories the product falls.

1. Biobased products within one or more designated items. If a biobasedproduct (including an intermediateingredient or feedstock) is within adesignated item at the time of submitting an application for

certification, the applicable minimum biobased content for use of the labelwould be the minimum biobasedcontent specified for that item in 7 CFR2902. As discussed in more detail

below, once an item has beendesignated, its minimum biobasedcontent, as specified in 7 CFR part 2902,

becomes the applicable minimum biobased content for all products withinthat designated item, regardless of anyprevious minimum biobased contentused to qualify a product for using thelabel.

If a biobased product is marketedwithin more than one designated item,and uses the same packaging, its

biobased content must meet or exceedthe specified minimum biobasedcontent for each of the designated itemsin order to use the label for each item.For example, Product A is currentlymarketed as a ‘‘glass cleaner’’ and a‘‘bath and tile cleaner’’ and uses thesame packaging in both markets. USDAhas designated both these categories of products as items under its BioPreferredprocurement program. Product A has a

biobased content of 60 percent. Theminimum biobased content of designated item ‘‘glass cleaners’’ is 49

percent and the minimum biobasedcontent of designated item ‘‘bath andtile cleaners’’ is 74 percent. Themanufacturer would not be eligible toapply for use of the label for Product Aunder either designated item. If the

biobased content of Product A wereinstead 80 percent, the manufacturerwould be eligible to use the label under

both designated items.If, on the other hand, the

manufacturer packaged the product indifferent packaging for marketing withinthe two designated items (e.g., a blue

bottle for the glass cleaner and a green

bottle for the bath and tile cleaner), theproduct marketed as a glass cleanerwould be eligible to apply to use thelabel while the product marketed as

bath and tile cleaner would not beeligible.

2. Finished biobased products that arenot within designated items. If a

biobased product is not within adesignated item at the time theapplication for certification issubmitted, the applicable minimum

biobased content for the product forusing the label would be 51 percent,





unless USDA approves an alternativeapplicable minimum biobased content.The proposed rule would allowmanufacturers, vendors, and tradeassociations (individually orcollectively) who believe that the 51percent minimum biobased content isnot appropriate for the biobased productto conduct an analysis, as discussed

under ‘‘Alternative Minimum BiobasedContent Analysis’’ later in thispreamble, to support an alternativeapplicable minimum biobased content.If USDA approves the alternativeapplicable minimum biobased content,then that content becomes theapplicable minimum biobased contentfor that product.

USDA recognizes that there will begroups of biobased products that will becertified to use the label that will never

be designated for preferredprocurement, primarily because theseproducts are produced by only one

manufacturer and, thus, there is notsufficient market competition to justifypreferred procurement or they are notused prevalently in the Federalmarketplace. However, USDA expectsthat the majority of the biobasedproducts certified to use the label will

be within a group of products thatUSDA designates for preferredprocurement. In those cases whereUSDA subsequently designates an itemunder which the certified biobasedproduct falls for inclusion in thepreferred procurement program, theapplicable minimum biobased contentfor the product will then become the

minimum biobased content establishedfor the designated item under which theproduct falls. As of the effective date of the designation, only those productsthat meet the new minimum biobasedcontent may continue to use the label.

3. Products that are intermediateingredients or feedstocks that are not within designated items. If a biobasedproduct is an intermediate ingredient orfeedstock and is not within a designateditem at the time the application forcertification is submitted, the applicableminimum biobased content for theproduct for using the label would be 51

percent, unless USDA approves analternative applicable minimum biobased content. As with the previousproduct category, the proposed rulewould allow manufacturers, vendors,and trade associations (individually orcollectively) who believe that the 51percent minimum biobased content isnot appropriate to conduct an analysis,as discussed under ‘‘AlternativeMinimum Biobased Content Analysis’’later in this preamble, to support analternative applicable minimum

biobased content. If USDA approves the

alternative applicable minimum biobased content, then that content becomes the applicable minimum biobased content for that product.

Rationale for Criterion 2: USDA believes setting the applicable minimum biobased content of products withindesignated items at the minimum

biobased content specified under the

preferred procurement program isappropriate, as USDA has had anopportunity to perform an analysis onthese products, including identifyingsimilar biobased products and theirmanufacturers, and obtaining biobasedcontents for similar biobased products.USDA intends to proceed with thedesignation of numerous items forwhich it has, or is currently gathering,information. Once the designationprocess has been completed for thoseitems that have been identified fordesignation, USDA intends to revisit, ona periodic basis, the minimum biobased

content that was established fordesignated items at the time of theirdesignation. As scientific advances andeconomic conditions warrant, USDAwould expect that the applicableminimum biobased content fordesignated items will rise ascompetitors apply advances andincrease the biobased content of designated products. Thus, it is USDA’sexpectation that the applicableminimum biobased content of designated items will increase asadvancements are made in biobasedproduct technology. USDA also notesthat proposed revisions to the

applicable minimum biobased contentfor designated items will be announcedin the Federal Register and the publicwill have an opportunity to providecomments on the proposal.

For the second and third categories of products (finished biobased productsand intermediate ingredients andfeedstocks that are not withindesignated items) USDA consideredseveral options for setting the minimum

biobased content, including the use of the lowest minimum biobased contentfor any item designated to date. USDAdecided, however, that in the absence of

the level of detailed productinformation for setting a minimum biobased content based on product-specific data (as is used under thepreferred procurement program), and inan effort to discourage minimal use of

biobased feedstocks in what areotherwise not biobased products, it isreasonable to consider such finishedproducts as ‘‘biobased’’ if they containa significant amount of biobasedmaterials; that is, at least 51 percent of the product is biobased. Thus, USDA isproposing that all finished products that

are not within designated items and allintermediate ingredients and feedstocksthat are not within designated itemsmust contain at least 51 percent

biobased content to be qualified for thelabel.

USDA recognizes, however, that forsome finished products (andintermediate ingredients) a 51 percent

minimum biobased content may resultin a product that is not viable. USDAalso recognizes that the 51 percentminimum biobased content coulddiscourage the development of new

biobased products or the continueddevelopment of existing biobasedproducts. With this in mind, USDA willcontinue to gather product-specific dataunder the preferred procurementprogram to determine applicableminimum biobased contents.Additionally, USDA believes that it isreasonable to provide a procedure toallow manufacturers, vendors, and trade

associations to propose an alternativeapplicable minimum biobased contentfor such products.

Alternative Minimum Biobased ContentAnalysis

As noted above, manufacturers,vendors, and trade associations would

be allowed to propose an alternativeminimum biobased content for productsnot within a designated item if they

believe that the proposed minimum biobased content is not appropriate fortheir product(s). For USDA to consideran alternative minimum biobasedcontent for these types of products,

manufacturers, vendors, and tradeassociations would be required todevelop an analysis, in consultationwith USDA, that demonstrates the needfor an alternative applicable minimum

biobased content. USDA believes thatmanufacturers, vendors, and tradeassociations should consult with theDepartment in developing the analysisto help ensure that an appropriateanalysis is conducted.

While the analysis of the datasupporting a specific request for analternative minimum biobased contentwill be performed on a case-by-case

basis, USDA anticipates that theevaluation process will be standardizedand will be similar to the process usedto set minimum biobased contentsunder the preferred procurementprogram. Such a process would includeidentifying similar biobased productsand their manufacturers anddetermining biobased contents forsimilar biobased products. USDArecognizes the difficulties involved incollecting biobased contents, due inlarge part to the unpredictability of manufacturer and vendor participation





hot link directly to the applicant’s Website (if available).

While USDA is not requiringmanufacturers to analyze theenvironmental and human healtheffects, life-cycle costs, sustainability

benefits, and performance of theirproducts, manufacturers making claimsregarding these attributes of their

products must maintain documentationto substantiate those claims pursuant tothe Federal Trade Commission (FTC)Act. Section 5 of the FTC Act (15 U.S.C.45) makes unlawful deceptive acts andpractices in or affecting commerce. TheFTC ‘‘Guides for the Use of Environmental Marketing Claims’’ (16CFR part 260) state that ‘‘any partymaking an express or implied claim thatpresents an objective assertion about theenvironmental attribute of a product,package or service must, at the time theclaim is made, possess and rely upon areasonable basis substantiating the

claim.’’Evaluation

USDA will evaluate each applicationto determine if it is a ‘‘complete’’application (i.e., that it contains all of the required information). If USDAdetermines that the application is notcomplete, it will return the applicationto the applicant and provide anexplanation of the deficiencies in theapplication. Once the deficiencies have

been addressed, the applicant mayresubmit the application for review byUSDA.

USDA will evaluate each completeapplication to determine if the productmeets the criteria for certificationdiscussed above (and specified in§ 2904.4). There will be no specifieddeadline for application submissions;applications will be worked on in a firstcome first serve basis. Based on thisevaluation, USDA either willconditionally approve the application orwill disapprove the application. USDAwill provide to each applicant a writtenresponse within 60 days after the receiptof a complete application, informing theapplicant whether or not its application

has been conditionally approved or has been disapproved. An applicant whoreceives notice from USDA that itsapplication has been conditionallyapproved may not begin using the labelon its product until the applicantreceives a notice of certification fromUSDA (see next paragraph). For thoseapplications that are not approved,USDA will notify the applicant andidentify each criterion not met.Applicants whose applications are notapproved have the right to appeal underthe proposed program first to USDA’s

BioPreferred program office and then toUSDA policy officials.

Notice of Product Certification

After an applicant receives noticefrom USDA that its application (for theproduct to bear the label) has beenconditionally approved, the applicantmust provide certain information, as

discussed in Section E in this preamble,to USDA. Once USDA has confirmedthat the information supplied by theapplicant is complete, USDA willapprove the product label applicationand will issue a notice of productcertification to the applicant. USDA willinclude in the notice of certificationinformation necessary for the applicantto access the applicable label artworkfrom the USDA BioPreferred Web site.Upon receipt of the notice of certification, the applicant may beginusing the label on the certified biobasedproduct.

Term of Product CertificationThe effective (beginning) date of the

product certification is the date that theapplicant receives the notice of certification from USDA. Thecertification will remain valid for aslong as the biobased product ismanufactured in accordance with theinformation supplied in the approvedapplication and presented on the USDAWeb site, with one exception. Asdiscussed earlier, it is USDA’s intentthat the applicable minimum biobasedcontent of designated items willincrease over time as advancements are

made in biobased product technology. If the applicable required minimum biobased content for a product to beeligible to display the label is revised byUSDA, manufacturers and vendors maycontinue to label their previouslycertified product only if it meets thenew minimum biobased content level.In those cases where the biobasedcontent of a certified product fails tomeet the new minimum biobasedcontent level, USDA will notify themanufacturer or vendor that theircertification is no longer valid. Suchmanufacturers and vendors must

increase the biobased content of theirproduct to a level at or above the newminimum biobased content level andmust re-apply for certification within 60days of receiving USDA’s notice if theywish to continue to use the label.Manufacturers and vendors who havere-applied for certification may continueusing the existing label until theyreceive notification from USDA on theresults of their re-application forcertification.

USDA considered proposing acertification period of either three or

five years, but decided that a fixedcertification period was unnecessaryand that the process of reapplying everythree or five years would impose anundue burden on manufacturers whodid not reformulate their products. Inthe case of items that becomedesignated, it is likely that the requiredminimum biobased content for the item

could be different from the 51 percentlevel used to qualify the item before itwas designated. USDA believes that, inthose cases, only those products thatmeet the new minimum biobasedcontent should be eligible to display thelabel. Thus, USDA is proposing that if a certified product’s biobased content is

below the newly established minimum biobased content, the manufacturermust discontinue applying the label asof the effective date of the itemdesignation. The same would be true inany other case where USDA, throughestablished notice and comment

rulemaking procedures, revises theminimum biobased content applicableto a previously certified product.

USDA points out that affixing thelabel to a certified biobased productdoes not imply that the useful life or theshelf life of the product has beenaffected in any way. Purchasers of labeled certified biobased products,therefore, should continue to look toinformation from the manufacturer orvendor to ascertain whether a productwill perform as advertised at the timethe purchase is made.

D. Appeals

Today’s proposed rule includesprovisions for appeal by an applicantwhose application for certification isdenied by USDA. In addition, entitiesthat have been cited for a violation orthat have received a notice of suspension or a notice of revocationmay also file an appeal. All appealsmust be filed within 30 days of receiptof the applicable notice. Appeals must

be made in writing to the ProgramManager of the Voluntary LabelingProgram for Biobased Products andmust contain, in part, a statement,including appropriate substantiating

documentation, of the appellant’sreasons for believing that USDAwrongfully denied the application orissued a notice of violation, suspension,or revocation. If the appellant isdissatisfied with the results of thisappeal, he/she may raise the appeal tothe Assistant Secretary forAdministration by letter request.Appeals to the Assistant Secretary forAdministration must be filed within 30days of receipt of the notice of decisionfrom the appeal to the ProgramManager.





The proposed rule also includesprovisions for manufacturers or vendorsof mature market products to appeal theexclusion of their products from thevoluntary labeling program if they

believe that conditions justify the use of the label on their products.

E. Information Posted on Web Site

Before USDA issues the notice of certification to a manufacturer or vendorto use the label on a biobased product,the manufacturer or vendor must submitcontact and product information toUSDA, which USDA will then post onthe USDA BioPreferred Web site (whichcan be accessed at http:// www.biopreferred.gov ). Thisinformation must be complete and must

be provided to USDA before USDA willprovide to the manufacturer or vendor,the notice of certification and theinformation for accessing the labelartwork. The information that must be

provided to USDA is:• Product brand name(s) or other

identifying information;• Contact information for the

applicant;• Biobased content level; and• A hot link directly to the

applicant’s Web site (if available).In addition to the information listed

above, USDA encourages manufacturersto provide other information related toproduct features and applicability forposting to the Web site.

USDA believes that making theinformation identified above available

on the USDA BioPreferred Web site will be an extremely valuable step inestablishing a database of certified

biobased products. Ideally, both Federalagencies and public consumers will beable to readily access information thatwill help them in their decision-makingregarding the purchase of biobasedproducts. USDA believes that makingthis information available not only toFederal agencies, but also to publicconsumers will result in increasedconsumer awareness of and use of

biobased products. USDA is alsoproposing that manufacturers of certified biobased products mustinclude the USDA Web site address onor in close proximity to the label.

Manufacturers must provide to USDAupdated information for posting byUSDA to the USDA BioPreferred Website whenever any of the information onthe Web site becomes outdated or if additional relevant information becomesapplicable. As discussed in Section I of this preamble, failure to provide USDAwith updated information will beconsidered a violation of therequirements of the labeling program.

F. Applications for Reformulated Products

A manufacturer may decide to changethe formulation of a certified biobasedproduct for various reasons includingperformance issues, raw materialavailability, or changes in productionprocesses. As discussed earlier,

manufacturers may also be required toreformulate products that are withindesignated items in response to USDAre-evaluating and increasing theapplicable minimum biobased contentfor products within the designated item.For such reformulated products to beeligible for USDA certification to use thelabel, USDA proposes that a newapplication be submitted to USDA, asdiscussed below.

If a certified product’s biobasedcontent is decreased by any amount, anew application would be required. Inany case where the biobased content of a product is decreased from the original

formulation, the biobased content of thereformulated product must still be at orabove the applicable minimum biobasedcontent for the product in order for theproduct to qualify for the label.

In the case of a product whose biobased content is reduced, themanufacturer or vendor cannot affix thelabel to the reformulated product untilthey have submitted a new application,provided USDA with the requiredinformation on the reformulatedproduct for posting to the USDABioPreferred Web site, and received thenotice of certification for the

reformulated product from USDA. If themanufacturer or vendor also continuesto sell the product in its originalformulation, the manufacturer or vendormay continue to affix the label to theoriginal product.

If a certified product’s biobasedcontent is increased, and themanufacturer wishes to change the labelto report the higher value, a newapplication would be required. Themanufacturer or vendor may continue toaffix the label to the reformulatedproduct. However, the manufacturer orvendor may not revise the biobased

content displayed on the label until theyhave submitted a new application,provided USDA with the requiredinformation on the reformulatedproduct for posting to the USDABioPreferred Web site, and received thenotice of certification for thereformulated product from USDA.

G. Requirements Associated With theLabel

Today’s proposed rule establishesspecific requirements for the use of thelabel. The requirements in today’s

proposed rule specify who may use thelabel, correct and incorrect uses of thelabel, the physical appearance of thelabel, and restrictions on the use of thelabel. These requirements aresummarized in the remainder of thissection.

USDA is also developing a MarketingGuide that will be made available to

manufacturers and vendors of labeledproducts. The purpose of this MarketingGuide is to provide expandeddiscussions of, and guidance onresolving, implementation issues thatmay arise related to the use of the label.For example, USDA anticipates thatthere will be questions related to the

best way to apply the label on verysmall products, such as those within thedesignated item ‘‘lip care products.’’USDA believes that a Marketing Guide,that can be updated frequently, is themost efficient way to keep label usersinformed of guidance provided by

USDA in response to implementationissues that arise.

Who May Use the Label?

Any manufacturer or vendor who hasreceived notice of certification fromUSDA, and any designatedrepresentative of such manufacturersand vendors, may use the label on theproduct and its associated packagingand in the advertising of the certified

biobased product. As proposed, only themanufacturer or vendor (and theirdesignated representatives) of a certified

biobased product would be granted theauthority to affix the label to the

product. The process of applying forand receiving certification requiresspecific knowledge of the product andits characteristics and formulation.Obtaining certification also imposes therequirement on the manufacturer andvendor to provide certain information toUSDA, which USDA will then post onthe USDA BioPreferred Web site.

Other entities may use the label toadvertise or promote certified biobasedproducts (e.g., in catalogs orprocurement databases), as long as themanufacturer or vendor of the product(or one of their designated

representatives) has affixed the label tothe product or its packaging. USDA believes that allowing other entities touse the label in informational,promotional, and educational materialsfor certified biobased products willpromote the goal of encouraging the useof biobased products.

Use of the Label

The label may be affixed only toproducts (or associated packaging) forwhich a manufacturer or vendor hasreceived a notice of certification under










this part. USDA’s intent is for the labelto be used by manufacturers, vendors,and other entities to distinguish

biobased products that meet or exceedthe criteria established by USDA fromthose that do not meet the criteria. It isalso important that the label be used ina consistent manner such that the labeland its meaning will become

recognizable in the marketplace. Use of the label on non-certified products oralterations in the appearance of the labelmay confuse consumers and diminishthe value of not only the label, but alsothe entire biobased product program.Therefore, USDA has identified correctand incorrect uses of the label, whichare discussed in the followingparagraphs.

Correct Uses. Proposed section 2904.7identifies correct usages of the label.These include, but are not limited to thefollowing:• The label may be used in

advertisements, catalogs, procurementdatabases, Web sites, and promotionaland educational materials;• The label may appear next to a

picture of the product(s) or textdescribing the product(s); and• The label may be used without

reference to a specific certified biobasedproduct only when informing the publicabout the purpose of the label. Forexample, the following or similar claimis acceptable: ‘‘Look for the ‘USDACertified Biobased Product’ label. Itmeans the product meets USDAstandards for the amount of biobasedcontent and the manufacturer or vendor

has provided relevant information onthe product for the USDA BioPreferredWeb site.’’ This exception allowsmanufacturers, vendors, and otherentities to use the label in documentssuch as corporate reports, but only in aninformative manner, not as a statementof product certification.

Incorrect Uses. Proposed § 2904.7 alsoidentifies incorrect usages of the label.These include, but are not limited to thefollowing:• The label may not be used on non-

certified products or in advertisementsor informational materials for non-

certified products;• The label may not be used to imply

endorsement by USDA or theBioPreferred Program of any particularproduct, service, or company; and• The label may not be used in any

form that could be misleading to theconsumer, or on business cards,company letterhead, or companystationery.

Imported Products

Because other countries may havedifferent definitions of ‘‘biobased’’

and/or use other terms, it is necessaryto address the use of the label onproducts for import. The ‘‘USDACertified Biobased Product’’ labelsignifies that a product meets specificUSDA criteria for biobased products.Therefore, in order for productsimported for sale in the U.S. to carry thelabel, they must meet the same criteria

as U.S.-sourced biobased products, andtheir manufacturers and vendors mustapply for certification to use the label,even if the products are considered

biobased products in the country inwhich they are manufactured.

Contents of the Label

The label must consist of thefollowing:• The logo with the phrase ‘‘USDA

Certified Biobased Product’’ and, whereapplicable, the letters ‘‘FP’’ to indicatethat the product is within a Federallypreferred designated item (this labelcontent is collectively referred to as the‘‘label artwork’’); and• A statement that identifies the

biobased content of the product, asreported in the approved application forthe product at the time the label isaffixed to the product or its packaging,and whether the label applies to theproduct or packaging.

USDA is proposing that the statementthat identifies the biobased content alsoindicate whether the label applies to theproduct or the packaging (e.g., Product:57% biobased; Packaging: 90%

biobased). The USDA is proposing thatthis statement be included in the label

in order to make it clear as to what thecertified biobased product is. USDA believes that there will be instanceswhere the placement of the label on aproduct or its packaging will not clearlyidentify the certified biobased product.For example, it is possible that a labelplaced on a container will refer to thecontainer itself (in which case thestatement ‘‘Packaging: XX% biobased’’would be used) or to the contents withinthe container (Product: YY% biobased).It may also be possible that both thecontainer and its contents are certified

biobased products, in which case two

statements would appear (Product:YY% biobased. Packaging: XX% biobased). Without tying the label to theproduct or the packaging, the consumermay be unable to determine whichproduct is the certified biobasedproduct. Therefore, USDA is proposingthat the appropriate statement(s) beincluded in the label in order to identifyclearly the product or products to whichthe label applies.

Furthermore, the proposed rulerequires that, at the time the label isaffixed to the product or its packaging,

the biobased content shown on the labelis the same as the biobased contentfound in the approved application forthe product. It is possible, however, thatthe biobased content of a certifiedproduct could be changed by themanufacturer. If a certified product’s

biobased content is changed to a level below that shown on the label, the

product is considered a reformulatedproduct and a new application isrequired. If a certified product’s

biobased content is increased and themanufacturer wishes to change the labelto the higher value, a new applicationis also required.

USDA also requires manufacturersand vendors to include the USDABioPreferred Web site address on or inclose proximity to the label. USDA isnot proposing to require that the Website address be on the label itself

because the label on many products willnot be large enough to accommodate

this extra information. USDA believesthat, where practicable, the presence of the USDA BioPreferred Web site addresson the label will assist consumers inobtaining information about biobasedproducts.

Physical Aspects of the Label

The rule addresses the physicalaspects of the label artwork and thepresentation of the biobased productstatement. In addition to therequirements of the rule, USDAanticipates that guidance on specificissues related to the physical aspects of the label will be provided in the

Marketing Guide.Label Artwork

To maintain the distinctiveness of thelabel artwork (which consists of thelogo, the phrase ‘‘USDA CertifiedBiobased Product’’ and, whereapplicable, the letters ‘‘FP’’) and tomake sure that it is readily recognizable,USDA has established requirementsrelated to the physical appearance of thelabel artwork. The applicable labelartwork provided by the BioPreferredProgram must be used.

USDA is also proposing color

requirements to ensure that the labelartwork remains distinctive andrecognizable. USDA is proposing torequire that one of three label versions

be used, depending on the need of theproduct. (1) A three-color version of thelabel artwork (white plus two shades of green); (2) a one-color version of thelabel artwork as long as the color usedis one of the two greens specified insection 2904.7(f) of today’s proposedrule; and (3) a black and white versionof the label artwork is also acceptable.The contrast between the light and dark





sections of the label artwork should begreat enough to maintain thedistinctiveness of the design.

Finally, the label artwork may not bealtered, cut, separated into components,or distorted in appearance orperspective.

Biobased product statement. Theapplicable biobased productstatement(s), which identifies theproduct(s) to which the label appliesand the biobased content(s), would beplaced below the label artwork. The

biobased content must be expressed as

‘‘XX%,’’ where XX% represents theactual biobased content of the product.The biobased content must be easilyreadable. Figure 1 illustrates theplacement of the biobased productstatement.

Placement of the Label

Whether the label is placed directlyon a product, on associated packaging,in user manuals, or in other material, itshould always be placed in a mannerthat ensures that the label (label artworkand biobased product statement(s)) can

be readily associated with theapplicable certified biobased product.The label should not be placed in amanner that is ambiguous about which

product is a certified biobased productor that could indicate certification of anon-certified product. If all products ona printed page are certified biobasedproducts, the label may be placedanywhere on the page. However, if aprinted page contains a mix of certified

biobased products and non-certifiedproducts, the label must be placed inclose proximity to the certified biobasedproducts. An individual label locatednear each certified biobased productmay be necessary to avoid confusion.

Minimum Size and Clear SpaceRecommendations for the Label

USDA recognizes that a specific sizerequirement for the label would not beappropriate because of the variety of sizes and shapes of products that may

be certified. Therefore, the label may besized to be appropriate for the particularapplication as long as the correctproportions are maintained and thelabel remains legible.

A border of clear space must surroundthe label and must be of sufficient widthto offset it from surrounding images andtext and to avoid confusion. If the

label’s color is similar to the backgroundcolor, an outlining color may be used toenhance contrast.

Where To Obtain Copies of the LabelArtwork

The two versions of the label artwork(with and without the letters ‘‘FP’’, asapplicable) will be available at theUSDA BioPreferred Web site. Onlymanufacturers and vendors approved

for use of the label for certified biobasedproducts will be able to obtain the labelfrom the Web site. USDA will providethe necessary access (through the noticeof certification) once a manufacturer orvendor has provided USDA with therequired information, which USDA willpost to the USDA BioPreferred Web site,for a product whose application forcertification has been approved byUSDA.

H. Violations

Although the decision to participatein the certified biobased productslabeling program is voluntary,compliance with the programrequirements and specifications will beessential to the success of the program.Proposed section 2904.8 identifiesexamples of the types of actions thatwould be violations of the labelingprogram.

To enforce the provisions of thevoluntary labeling program, USDA willimplement an audit program. This auditprogram will include, but notnecessarily be limited to, conductinginspections of manufacturer and vendor

facilities, visiting retail facilities, andtesting the biobased content of certified

biobased products. Visitingmanufacturer and vendor facilities andinspecting their records, for example,will help USDA identify potential labeland application violations. Testingcertified biobased products for their

biobased contents will help USDAdetermine any violations associatedwith biobased contents. Manufacturers,

vendors, and their designatedrepresentatives are required to cooperatefully with all USDA audit efforts for theenforcement of the voluntary labelingprogram. USDA envisions selecting fiveto ten percent of labeled products atrandom for audit each year.

Both the violations being proposedand any penalties associated with aviolation would be applied on a perproduct basis. For example, amanufacturer has two certified biobasedproducts, Product A and Product B. Themanufacturer has been cited for alabeling violation for Product A and the

certification for Product A has beenrevoked. As proposed, the manufacturerwould be required to discontinuelabeling Product A, and USDA wouldremove the information for Product Afrom the USDA BioPreferred Web site.If no actions were taken against themanufacturer with regard to Product B,the manufacturer’s certification forProduct B would not be affected by theviolation associated with Product A.Thus, the manufacturer would still beallowed to affix the label to Product B,and Product B’s information would





remain on the USDA BioPreferred Website.

Finally, the appeals process describedpreviously is also applicable when anotice of violation, suspension, orrevocation is issued.

Biobased Content Violations. Asnoted earlier, as part of its auditprogram, USDA will conduct random

tests of certified biobased productstaken from market shelves to determinetheir biobased contents and compare theresults to a product’s applicableminimum biobased content and the

biobased content reported by themanufacturer or vendor in the approvedapplication. USDA will conduct suchtesting using ASTM D6866, StandardTest Methods for Determining theBiobased Content of Natural RangeMaterials Using Radiocarbon andIsotope Ratio Mass SpectrometryAnalysis.

If the USDA testing shows that the biobased content of a certified biobasedproduct is less than the applicableminimum biobased content identified inthe approved application for theproduct, then a violation of the labelingregulations has occurred.

If USDA testing shows that the biobased content of a certified biobasedproduct is less than that reported in theapproved application, but is still equalto or greater than the applicableminimum biobased content, USDA willnotify the manufacturer or vendor of itsresults. USDA may forward the testresults to the Federal Trade Commissionfor possible enforcement. The

manufacturer or vendor would thenhave 30 days to submit a newapplication, showing a revised biobasedcontent for the product. The revised

biobased content could be either the biobased content from the USDA test ora biobased content reported by themanufacturer or vendor based on a newtest conducted by the manufacturer orvendor. If the manufacturer or vendorelects to conduct a new biobasedcontent test, the manufacturer or vendormust test a current sample of theproduct. Failure to provide a newapplication (including new test results)

with a revised biobased content within30 days of receipt of USDA’s writtennotification would be considered aviolation.

USDA notes that if its testing showsthat the biobased content of a certified

biobased product is greater than the biobased content reported in theapproved application, no violationwould have occurred. USDA will,however, notify the manufacturer orvendor of the results of the testing, askif they would like to submit a secondproduct test, and potentially be allowed

to increase the biobased content shownon their label.

Label Violations. Any usage ordisplay of the label that does notconform to the requirements proposedin section 2904.7 would be considereda violation of the proposed labelingregulations. For example, applying alabel to a product that does not have a

valid certification would be a labelviolation.

Application Violations. Knowinglyproviding false or misleadinginformation in any application forcertification of a biobased productwould be a violation of the proposedlabeling regulations. For example,certifying in the application that theproduct meets the definition of a

biobased product when it does notwould be an application violation.

USDA BioPreferred Web siteViolations. As proposed, failure toprovide to USDA updated informationon a certified biobased product whenthe information for the certified

biobased product becomes outdated(e.g., a change in a product’s biobasedcontent), would be a violation.

Notice of Violations and Associated Actions. When a violation has beenidentified, USDA will provide writtennotification of the violation to theapplicable entity, which may be themanufacturer, vendor, or its designatedrepresentative or other entity. In allinstances, the manufacturer of theproduct for which USDA has identifiedthe violation will also be notified. Thenotice of violation will identify the

violation. In the case of biobasedcontent violations, the offending partywill then have 30 days from the date thenotice of violation is received to correctthe violation. For other types of violations, the offending party will have60 days from the date the notice of violation is received to correct theviolation. The 30-day period forresolving violations of biobased contentviolations is more stringent than the 60-day period allowed for resolving othertypes of violations because biobasedcontent violations, whether intentionalor not, are viewed as misleading

consumers and could result ininappropriately influencing theirpurchasing decisions.

If the party receiving the notice of violation is an ‘‘other entity,’’ USDAwill pursue remedies as provided forunder proposed section 2904.8(c). If theparty is a manufacturer, vendor, or oneof its designated representatives, USDAwill first pursue notices of suspensionand revocation, as discussed below.USDA also reserves the right to pursueother remedies as provided in§ 2904.8(c).

Suspension of Certification. Afterreceiving a notice of violation, if themanufacturer, vendor, or designatedrepresentative, as applicable, fails tomake the required corrections within 60days (or 30 days, in the case of biobasedcontent violations), USDA will notifythe manufacturer or vendor of thecontinuing violation and will suspend

USDA certification for that product. Asof the date the manufacturer or vendorreceives a notice suspending productcertification, the manufacturer orvendor and any designatedrepresentatives must not affix the labelto any of that product, or associatedpackaging, not already labeled. Also, themanufacturer or vendor must notdistribute any additional products

bearing the label after receiving a noticeof suspension of product certification.When USDA suspends a product’scertification, USDA will issue a pressrelease informing the public of the

suspension and will also remove theinformation on that product from theUSDA BioPreferred Web site. If USDAlearns that entities whose certificationhas been suspended continue to use thelabel, USDA will refer that informationto the Federal Trade Commission forenforcement.

In order to resume use of the label fora product whose certification has beensuspended, the manufacturer, vendor, ordesignated representative must correctthe violation and notify USDA that theviolation has been corrected within 30days from receipt of the notice of suspension and must receive approval

from USDA before use of the label can be resumed. Once USDA has approvedthe corrections to the violation, USDAwill restore the product information tothe USDA BioPreferred Web site.

Revocation of Certification. If amanufacturer or vendor whose USDAproduct certification has beensuspended fails to make the requiredcorrections within 30 days of the date of the suspension, USDA will notify themanufacturer or vendor that thecertification for that product is revoked.As of the date that the manufacturer orvendor receives the notice revoking

USDA certification, the manufacturer orvendor and any designatedrepresentatives must not affix the labelto any of that product, or associatedpackaging, not already labeled. Inaddition, the manufacturer or vendorand its designated representatives areprohibited from further sales of theproduct to which the label has already

been affixed to any entity. However, if,prior to receipt of a notification of revocation, a manufacturer or vendorhas stored a supply of product with thelabel that has already been sold to





another entity, the manufacturer orvendor must notify the entity of thelabel revocation and allow the entity tocancel the transaction. If a manufactureror vendor whose product certificationhas been revoked wishes to use thelabel, the manufacturer or vendor mustfollow the procedures required fororiginal certification.

Other Remedies. In addition to thesuspension or revocation of thecertification to use the label, dependingon the nature of the violation, USDAmay pursue suspension or debarment of the entities involved in accordance withpart 3017 of this title. USDA furtherreserves the right to pursue any otherremedies available by law, includingany civil or criminal remedies, againstany entity that violates the provisions of this part.

I. Recordkeeping Requirements

Manufacturers and vendors who

choose to participate in the voluntarylabeling program will be required tokeep certain records related to theirlabeled biobased products. USDA

believes these records are necessary toensure compliance with the labelingregulations. Manufacturers and vendorsmay keep these records in eitherelectronic or hard copy format. Therecords that must be kept include:• The results of all tests, and any

associated calculations, performed todetermine the biobased content of theproduct;• The results, and the supporting

documentation, of industry standard

functional performance tests to supportproduct performance claims made bythe manufacturer or vendor;• The results, and the supporting

documentation, of analyses themanufacturer or vendor has performedto support claims of environmental orhuman health effects, life cycle costs,and sustainability benefits of theproduct;• Documentation that the product for

which certification is sought meets thedefinition of biobased product, asdefined in §2904.2 of this part; and• The date of the certification by

USDA and the dates when the biobasedcontent of certified biobased productswas tested.

Records created under therequirements of today’s proposed rulemust be maintained for at least threeyears beyond the end of the labelcertification period (i.e., three years

beyond the period of time whenmanufacturers and vendors cease usingthe label). If electronic records aremaintained, they must be readilyaccessible during an audit by USDA.USDA believes that a three-year record

retention period is the minimumnecessary to allow verification of theinformation supporting activecertifications. Manufacturers, vendors,and their designated representativesmust allow Federal representativesaccess to these records for inspectionand copying during normal Federal

business hours to determine compliance

with the applicable regulations. J. Reporting

USDA encourages manufacturerscertified to use the label to provide datain order to enable USDA to estimate andpublicly report the benefits and generaleffectiveness of the Voluntary LabelingProgram. The quantity, frequency, andformat of the data will be as the partiesmutually agree. Such data may include,if and as available: (1) The total numberof units of each product shipped bymanufacturer for sale in the U.S., and(2) the type of customer (e.g.,

government, other public institution,private/corporate institution, privateindividual) to whom such productswere sold.

USDA recognizes that manufacturersand vendors may consider some of therequested information to beconfidential. USDA stresses thatinformation claimed as confidential bythe manufacturer or vendor will not bereleased and that individualmanufacturer or vendor data will not bereported. Only summary informationregarding the benefits and impacts of the entire program will be released.

IV. Suggested Comment TopicsUSDA invites comment on any aspect

of today’s proposed requirements for thevoluntary labeling program for biobasedproducts. USDA invites specificcomments in the areas identified below.

1. Who can apply for the label ? Underthe proposed rule, both manufacturersand vendors of biobased products canapply for use of the label for theirproducts. USDA is interested incomments on whether it is appropriateto include vendors as an entity eligibleto apply for use of the label. Some of therequirements associated with approval

for use of the label will requireinformation generally only available tothe manufacturer. In addition, it is themanufacturer, not the vendor, whodetermines a product’s formulation andproduction process. What issues woulda vendor face in complying with theproposed rule in light of this?

2. Applicable minimum biobased contents. For products (includingintermediate ingredients and feedstocks)not within a designated item, USDA isinterested in comments associated with;(a) the 51 percent applicable minimum

biobased contents that products withinthis category must meet in order to beeligible for use of the label, and (b) theprocedure under which an applicantcan request an alternative applicableminimum biobased content (i.e., anapplicable minimum biobased contentother than 51 percent).

3. The labeling of ‘‘complex

products.’’ In addition to the threecategories of products (products withindesignated items, those that are notwithin designated items, and those thatare intermediate ingredients andfeedstocks that are not withindesignated items) that would be eligibleto use the label under today’s proposedrule, USDA also intends to developprovisions for the labeling of ‘‘complexproducts’’ once several implementationissues have been resolved. A complexproduct is considered to be a finished,consumer product that is composed of many different types of components.

Examples of complex products would be products such as computers, vacuumcleaners, lawn mowers, andautomobiles. Each of these productscontains many component parts made of different materials. For products such asthese, it may be feasible to produce oneor more of the component parts with

biobased materials.Today’s proposed rule does not

contain provisions to allow for thelabeling of complex products becausethere is currently no approved methodto determine the biobased content of acomplex product. USDA has consultedwith ASTM representatives regarding

the lack of an approved test method.ASTM is gathering information oncomplex products and they intend toproceed with the development of amethod that can be used to determinethe biobased content of complexproducts. USDA will continue to workclosely with ASTM and themanufacturers of complex products and,once an acceptable test method isavailable, expects to amend thevoluntary labeling rule to allow for thelabeling of complex products.

USDA requests that commentersprovide information on the types of

complex products containing biobasedcomponents that are in the marketplacetoday, as well as those which may be inthe developmental stage. Information onthe types of components that contain

biobased materials, the typical biobasedcontent of these components, and themarket share of the biobasedcomponents is requested by USDA.Information on current research effortsto develop new biobased componentsfor complex products is also requested.USDA is also interested in commenters’opinions regarding how complex





products and their biobasedcomponents should be addressed in thedesignation process as well as thevoluntary labeling program.

4. The labeling of ‘‘mature market products.’’ The proposed rule does notallow the label to be applied to productsthat are considered to be ‘‘maturemarket products’’ (i.e., products that

had significant market penetration in1972), except on a case-by-case basis.Section 2902.5(c)(2) of the finalGuidelines also excludes mature marketproducts from the designation process.However, USDA is proposing to allowmanufacturers of mature marketproducts to appeal (on a case-by-case

basis) the exclusion of their productsfrom the voluntary labeling program if they believe that conditions justifyspecial consideration for their products.A possible example would be themanufacturer of a traditional biobasedproduct that had a significant market

share in 1972, lost that market share topetroleum-based alternative productsduring the years between 1980 and2000, is now attempting to re-enter themarket, and believes the label will behelpful in this attempt. Other instanceswhere USDA might consider grantingappeals of the exclusion of maturemarket products include those wherelabeling a product could be shown to:reduce dependence on foreignpetroleum sources; create new ‘‘green’’jobs; or reduce greenhouse gasemissions.

USDA welcomes comment onwhether mature market products should

be eligible for labeling and whether thelabeling of mature market productscould negatively affect the entry of new(i.e., post-1972) biobased products intomarket segments in which matureproducts already have significantmarket shares. USDA also requestscomments regarding what criteriashould be used to evaluate appeals toinclude mature market products in thelabeling program and what types of information manufacturers and vendorsshould be required to submit asjustification for their appeal.Commenters should provide specific

reasons why the use of the label onmature market products should beconsidered, including information onthe expected benefits of the label. USDAis also seeking comments on why thislabel might be preferred over, or how itcould be used in conjunction with,other available labels such as the‘‘cotton,’’ ‘‘renewable,’’ or ‘‘organic’’labels that can be used on many maturemarket products.

5. The appropriate lengths for thecertification periods. USDA is proposingthat certifications remain valid for as

long as the certified product ismanufactured in accordance with theapproved application. USDA considereda certification of either three or fiveyears, but chose not to propose aspecified time period, primarily toreduce the burden that would beassociated with reapplying forcertification. USDA welcomes

comments on the appropriate length of time that a certification should be valid.Be sure to include rationale for anyrecommendations of alternativecertification periods.

6. Preliminary notice of violations.USDA welcomes comments on whethera preliminary notice of violation for anyof the proposed violations should beissued before action is taken by USDAagainst the violators and, if so, how longa violator should be given to correct theviolation before action is taken.

7. Biobased content testing facilities.USDA solicits comments on theappropriateness of requiring that labs beISO 9001 conformant. Specifically, arethere benefits in such a requirement interms of the quality of the resulting dataand, if so, is ISO 9001 the appropriatestandard? Commenters are encouragedto provide their opinions on whetherthere are other standards (such as ISO17025) that would be more appropriate.

8. Clarification of biobased content of product vs. packaging on label. Asdiscussed earlier in this preamble,USDA believes that it is important toidentify for the consumer the item towhich the label applies. Therefore,USDA is proposing that the label

include the appropriate biobasedproduct statement(s) to make this clear.

USDA seeks comments to determine if the use of the word ‘‘product’’ in thestatement ‘‘Product: YY% biobased’’ isclear enough. For example, if the labelapplies to a biobased hydraulic fluid,

but not to its container, does thestatement ‘‘Product: YY% biobased’’found on the container clearly conveythat the label applies to the hydraulicfluid and not the container? If thisstatement does not clearly convey this,please suggest alternatives that wouldmore clearly accomplish this.

When the label applies to both theproduct and its packaging, is itnecessary to provide the biobasedcontent of both the product and itspackaging? As proposed, two statementswould be included on the label(Product: YY% biobased. Packaging:XX% biobased). USDA welcomessuggestions on how to addressproviding biobased content informationwhen the label applies to both theproduct and its packaging.

9. Identifying products that are alsoeligible for a Federal procurement

preference under the preferred procurement program. As proposed, biobased products that fall withindesignated items and are, therefore,eligible for Federal preferredprocurement, would use a label with theletters ‘‘FP’’ included in the labelartwork. USDA considered simplyallowing manufacturers to indicate in

the product’s literature that the productis eligible for preferred procurementrather than requiring such informationon the label itself. USDA decided thatthere may be a benefit to either Federalagencies or to the public consumers tohave this information on the label.USDA is seeking comments on whetherthe ‘‘FP’’ lettering on the label will besufficient to distinguish products thatare eligible for Federal preferredprocurement. USDA is also requestingcomments on whether consumers willrecognize that the lettering on productsmeans that these products, or similar

products, have undergone life cyclecosts and environmental performanceanalyses. USDA also welcomescomments on how the labeling programand the preferred Federal procurementprogram should work together.

10. Other possible label content. Asdiscussed above, USDA is proposingthat the label include the biobasedcontent (expressed as a percentage), astatement indicating whether the

biobased content refers to the product orthe packaging or both, and theBioPreferred Web site address (either onor in close proximity to the label).USDA also considered the possible

advantages and disadvantages of requiring additional information on thelabel. For example, USDA is proposingthat information on productperformance and on the life-cycle costsand environmental and human healtheffects of the labeled products bemaintained if manufactures make claimsregarding these attributes for theirproducts. USDA considered whetherproviding this type of additionalinformation on the label would be

beneficial to purchasers.The primary advantage of providing

additional information on the label is to

further educate purchasers about theattributes of the biobased products theychoose to purchase. However, becausethe results of these analyses wouldtypically be available only for labeled

biobased products, a comparison to non-labeled biobased, or non-biobased,competing products may often beimpossible. Also, the amount of spacethat would be needed for a legiblepresentation of this information could

be a serious drawback for many smallproducts (e.g., household cleaners, haircare products, lip care products).





USDA is proposing to requiremanufacturers to include theBioPreferred Web site address either onor in close proximity to the label. USDAis requesting comments on the possible

benefits of this proposed requirementand also on any expected drawbacks ornegative impacts.

USDA requests comments and

recommendations regarding the value of providing the types of additionalinformation discussed above on thelabel and specifically requests input onwhat types of information should beincluded and how it should bepresented.

11. Legibility of the label. Asproposed, the label would consist of twoitems, the label artwork and the

biobased product statement(s) with theaccompanying biobased content(s). Thisis a significant amount of informationand, for some small products, couldresult in a label that is difficult to read.Therefore, USDA is seeking comment onways to help ensure that the informationproposed to be included will be legible.Depending on the comments it receivesand the rationale behind thosecomments, USDA may require adifferent presentation of thisinformation.

12. Timeframe for correcting violations. Under the proposed rule,USDA would allow up to 60 days forentities to correct violations (30 days for

biobased content violations) before anotice of suspension or other remedy issought. USDA is seeking comment onwhether it is preferable for the

timeframe to correct a violation to befixed, including the appropriate lengthto allow (e.g., are the 30- and 60-dayperiods in the proposed rulereasonable?) or to be determined on acase-by-case basis to be specified in thenotice of violation.

13. Recordkeeping. The proposed rulerequires certain records be kept in orderto allow USDA to verify informationassociated with the labeling programand that these records be kept for atleast three years beyond the end of thelabel certification period (i.e., threeyears beyond the period of time when

manufacturers and vendors cease usingthe label). USDA welcomes commentson the specific records to be kept andthe length of time they must be kept,including comments related torecordkeeping costs.

14. Benefits and Costs. USDA requestscomments on the potential benefits(social and private) and costs (e.g.,testing, submitting applications andassociated information, andrecordkeeping) of the proposed rule.

15. Application Fee. USDA isconsidering the option of charging an

application fee for each application touse the label. While DepartmentalAdministration does not currently havethe statutory authority to collect such afee, available options are beingexplored. As discussed elsewhere inthis preamble, USDA plans toimplement an audit program to ensurecompliance with the requirements for

the use of the label. Based on experiencewith other programs, USDA believes itmay be necessary to assess user fees inorder to maintain a viable auditprogram. The proceeds from theapplication fee would, therefore, beused to help offset the cost of the auditprogram. USDA believes that it is in the

best interest of not only USDA but alsothe manufacturers of labeled productsthat an audit program be implementedso that the integrity of the label can beassured. Were authority provided to doso, USDA would consider charging a feeof $500 for each submitted application

and requests comments on theappropriateness of that amount as wellas on the charging of a fee at all.

Please be sure to include yourrationale for all suggested changes to theproposed rule. Comments must besubmitted as directed in the ADDRESSES section of this notice.

V. Regulatory Information

A. Executive Order 12866: Regulatory Planning and Review

Executive Order 12866 requiresagencies to determine whether aregulatory action is ‘‘significant.’’ This

proposed rule has been reviewed underExecutive Order (EO) 12866 and has

been determined to be significant.Today’s proposed rule establishes avoluntary labeling program that allowsmanufacturers and vendors of certified

biobased products to use the ‘‘USDACertified Biobased Product’’ label.Although the labeling program isvoluntary, there will be costs associatedwith meeting the criteria for, andapplying for, certification to use thelabel.

1. Costs of the Proposed Rule

The primary costs associated withparticipating in this program are thosefor developing applications, testing todocument the biobased content of products, providing information toUSDA for posting by USDA on theUSDA BioPreferred Web site,maintaining applicable records, andredesigning the product packaging toincorporate the label. USDA estimatesthat the combined annualized cost of the voluntary program, as proposed, tomanufacturers and vendors wouldaverage approximately $2,813,811 per

year for the first three years of theprogram. USDA estimates an average of 352 manufacturers and vendors per yearwill submit applications to participatein the labeling program for the firstthree years of the program. This yieldsan average annualized cost permanufacturer/vendor of approximately$7,994.

The level of presumed impact is notexpected to exceed $100 million

because of the offsetting nature of thelabeling program (i.e., an increase indemand for biobased products is likelyto be offset by a decrease in demand fornon-biobased products). While theprogram is anticipated to have awidespread effect on the marketplace(including shifting purchases away fromnon-biobased products toward thepurchase of biobased products), it is notexpected to have a widespread adverseeffect on the economy.

2. Benefits of the Proposed Rule

As an integral part of USDA’sBioPreferredSM Program, the voluntarylabeling program is expected to raisepublic awareness of, and increase thedemand for, biobased products. Whilethe benefits of the labeling program arenot quantifiable at this time, anincreased demand for biobased productswill, in turn, achieve the benefits asoutlined in the objectives of section9002: To increase domestic demand formany agricultural commodities that canserve as feedstocks for production of

biobased products; to spur developmentof the industrial base through value-

added agricultural processing andmanufacturing in rural communities; toenhance the Nation’s energy security bysubstituting biobased products forproducts derived from imported oil andnatural gas; and to substitute productswith a possibly more benign or

beneficial environmental impact, ascompared to the use of fossil energy-

based products. On a national andregional level, today’s proposed rule canresult in expanding and strengtheningmarkets for biobased materials used inthese items. The program is alsoexpected to promote economic

development for biobased productmanufacturers and vendors by creatingnew jobs and providing new markets forfarm commodities.

B. Regulatory Flexibility Act (RFA)

Under the RFA, an agency is notrequired to prepare a regulatoryflexibility analysis of any rule subject tonotice and comment rulemakingrequirements under the AdministrativeProcedure Act or any other statute if theagency can certify that the rule will nothave a significant economic impact on





a substantial number of small entities.Small entities include small businesses,small organizations, and smallgovernmental jurisdictions.

Of these three types of entities, thelabeling requirements in today’srulemaking would be applicable tosmall businesses only. For purposes of assessing the impacts on small entities,

a small business is defined by the RFAusing the definitions for small business

based on Small Business Administrationsize standards, which vary dependingon the type of business (e.g., less than500 employees, less than 1,000employees). Most of the manufacturingcompanies and vendors associated withproducts within items that USDA hasdesignated or proposed for designationwould qualify as small businesses underSBA guidelines.

While we do not have enoughinformation to evaluate fully thepotential effect of this proposed rule on

small entities, we have someinformation to make some initialconclusions. We identified six NorthAmerican Industrial ClassificationSystem (NAICS) categories under whichmany biobased products aremanufactured: Petroleum lubricating oiland grease manufacturing, plasticsmaterial and resin manufacturing, soapand other detergent manufacturing,urethane and other foam product(except polystyrene) manufacturing,carpet and rug mills manufacturing, andfertilizer manufacturing. We then usedeconomic census data to determine the

average value of shipments, a reasonablesurrogate for annual sales, forcompanies in these categories. Theanalysis indicates that the average valueof shipments in 2002, the most recentyear for which there are completecensus data, for the six NAICScategories examined is over $10 millionper year per establishment. USDArequests comments on the quality of thisanalysis and ways to improve it.

More recent manufacturing censusdata on firm size, from 2006, indicatesthat, collectively, over 94 percent of thefirms in the six categories meet theSmall Business Administrationdefinition of small business for the sixcategories.

The benefit-cost analysis USDAconducted for the proposed rule,discussed in Section I. below, indicatesthat the annualized cost associated withparticipating in the voluntary labelingprogram is about $7,994 on average and,relative to total sales by small

businesses in the NAICS categorieswhere many biobased products aremanufactured, appears not to representan undue burden in most cases.

Moreover, participation in thevoluntary labeling program wouldprovide manufacturers and vendors amarketing advantage over those whochoose not to participate. Thismarketing advantage could lead togreater sales, thus offsetting some of thecosts associated with participating inthe labeling program.

Finally, the program requirements forthe voluntary labeling program areapplicable to all manufacturers andvendors of biobased products seeking touse the label under this program,regardless of the size of their business.For instance, all manufacturers andvendors are required to submit anapplication, conduct certain testing, andprovide to USDA certain informationthat USDA will post to the BioPreferredWeb site. These requirements arenecessary to certify biobased productsand are independent of the size of themanufacturer or vendor. The integrity of

the labeling program would becompromised if biobased productsmanufactured by small businesses wereallowed to be subject to different criteriain order to reduce costs to small

businesses.Based on this initial analysis, USDA

has not prepared a RegulatoryFlexibility Analysis because USDA hasdetermined that this rule does not havea significant impact on a substantialnumber of small entities.

C. Executive Order 12630:Governmental Actions and InterferenceWith Constitutionally Protected Property

RightsThis proposed rule has been reviewed

in accordance with Executive Order12630, Governmental Actions andInterference with ConstitutionallyProtected Property Rights, and does notcontain policies that would haveimplications for these rights.

D. Executive Order 13132: Federalism

This proposed rule does not havesufficient Federalism implications towarrant the preparation of a FederalismAssessment. Provisions of this proposedrule will not have a substantial direct

effect on States or their politicalsubdivisions or on the distribution of power and responsibilities among thevarious government levels.

E. Unfunded Mandates Reform Act of 1995

This proposed rule contains noFederal mandates as defined under theregulatory provisions of Title II of theUnfunded Mandates Reform Act of 1995(UMRA), 2 U.S.C. 1531–1538, for State,local, and tribal governments, or theprivate sector. Therefore, a statement

under section 202 of UMRA is notrequired.

F. Executive Order 12372:Intergovernmental Review of Federal Programs

For the reasons set forth in the FinalRule Related Notice for 7 CFR part 3015,subpart V (48 FR 29115, June 24, 1983),

this program is excluded from the scopeof Executive Order 12372, whichrequires intergovernmental consultationwith State and local officials. Thisprogram does not directly affect Stateand local governments.

G. Executive Order 13175: Consultationand Coordination With Indian Tribal Governments

Today’s proposed rule does notsignificantly or uniquely affect thecommunities of Indian tribalgovernments. The proposed rule doesnot impose any mandate on tribalgovernments or impose any duties onthese entities. Thus, no further action isrequired under Executive Order 13175.

H. Paperwork Reduction Act

In accordance with the PaperworkReduction Act of 1995 (44 U.S.C. 3501et seq.), USDA is seeking OMB approvalof the reporting and recordkeepingrequirements contained in this proposedrule. USDA conducted a burdenanalysis of the costs associated with thisproposed rule, as well as a benefit-costanalysis. The primary costs of participating in the voluntary labelingprogram are the costs of testing the

biobased content of products and thecosts of labor associated with readingthe rule, applying for certification,gathering and submitting theinformation for posting to theBioPreferred Web site, and keepingapplicable records for the products forwhich certification is sought. See thecontact information at the end of thissection for details on how to request acopy of materials related to theInformation Collection Request.

Methodology

To estimate the average annual

burden over the first three years of therule, USDA estimated the number of hours that each activity (e.g., read therule, complete the application, submitinformation to USDA, appeal deniedapplications, keep records) would take,summed the estimates for each activityto get an average total number of hoursper manufacturer/vendor, andmultiplied that total by the estimatednumber of manufacturers/vendors. Thetotal cost of biobased content testingwas then projected by multiplying theestimated total number of biobased





products for which certification isexpected to be sought by the cost of thetest. The labor component of the costand the testing component were thensummed to give a total estimated

burden.

Assumptions

In estimating the costs for the burden

analysis, USDA made the followingassumptions.

1. In the first year of the voluntarylabeling program, USDA estimates that100 items will have been designated aseligible to receive the procurementpreference, another 36 items will have

been designated in the second year of the labeling program, and another 30items will have been designated in thethird year of the labeling program.

2. Based on information gatheredduring the item designationrulemakings, USDA estimates thatapproximately 830 manufacturers of products within these 166 designateditems and an additional 830manufacturers of biobased products(including intermediate ingredients orfeedstocks) within items that are notdesignated for preferred procurementare expected to have an interest in usingthe label, yielding 1,660 manufacturerswith eligible biobased products over thefirst three years. USDA estimates that anadditional 200 vendors over the firstthree years would be interested in thevoluntary labeling program. This yieldsa total of 1,860 manufacturers andvendors. Finally, USDA estimates that166 other entities over the first three

years would be interested in thevoluntary labeling program.

3. Because the voluntary labelingprogram is new and the benefits tomanufacturers of labeling their biobasedproducts are not yet demonstrated,USDA anticipates that manymanufacturers may be reluctant toparticipate during the first few years of the program. USDA expects that duringthe first three years of the program,participation by one half to two thirdsof eligible manufacturers/vendorswould be a reasonable estimate.Therefore, USDA assumed that sixty

percent of the manufacturers of products within designated items, sixtypercent of the manufacturers of products that are not within designateditems, and thirty percent of the vendorswith eligible biobased products wouldapply for certification to use the label.Thus, 1,056 manufacturers and vendors((830 × 0.6) + (830 × 0.6) + (200 × 0.3)= 1,056) would apply to use the labelover the first three years (an average of 352 per year).

4. Based on information gathered tosupport the designation of items for

preferred procurement, the averagenumber of biobased products permanufacturer is between six and seven.For this analysis, USDA estimates thateach applicant would submitapplications for six products. Thisresults in the submittal of 2,112applications (352 applicants times 6products per applicant) for products, on

average, for each of the first three years.Of these, USDA estimates that 95percent will be approved for use of thelabel.

5. In estimating the cost of the laborfor reading the rule, completingapplications, gathering and submittinginformation for posting on theBioPreferred Web site, and maintainingthe applicable records, USDA used anaverage labor cost of $49.98 per hour.This hourly rate is based on the Federalsalary schedule, step 6, GS 14 ‘‘rest of the United States’’ salary of $103,957per annum (with 2080 hours worked per

annum). The salary level is deemedreasonable under the expectation that atleast half the burden hours would likely

be provided by private sector employeesearning less than this hourly rate and upto half the private sector employeeswould be earning more.

6. Based on the biobased contenttesting performed to support the itemdesignation rulemakings, USDAestimated an average cost of $500 toperform biobased content testing.

Estimated Burden

During the first three years thelabeling program is in effect, the total

annual burden on all respondents isestimated to be $2,813,811. For theestimated 352 manufacturers/vendors(see item 3 above) certified to use thelabel, the average burden is, therefore,estimated to be $7,994 ($2,813,811 ÷ 352= $7,994).

Abstract

The Farm Security and RuralInvestment Act of 2002 (2002 Act), asamended by the Food, Conservation,and Energy Act of 2008, established theBiobased Markets Program under TitleIX, Section 9002. The 2002 Act requires

the Secretary of Agriculture to create avoluntary labeling program for biobasedproducts.

The information requirementscontained in this proposed rule requireinformation from manufacturers andvendors of biobased products that seekto use the label on qualified biobasedproducts. The information is vital forUSDA to evaluate the qualifications of

biobased products to carry the USDAlabel and to ensure that the label is usedproperly. This collection of informationis necessary in order to implement the

voluntary labeling program for biobasedproducts established under the 2002Act.

Copies of this information collectioncan be obtained from Ron Buckhalt atthe following address: Ron Buckhalt,USDA, Office of the Assistant Secretaryfor Administration, Room 300,Reporters Building, 300 Seventh Street

SW., Washington, DC 20024; e-mail:[email protected]; phone (202)205–4008.

As part of our continuing effort toreduce paperwork and respondent

burdens, USDA invites the public andother Federal agencies to comment onany aspect of the reporting burden inthe proposed rule. Comments areinvited on: (1) Whether the proposedcollection of information is necessaryfor the proper performance of thefunctions of USDA in the operation andmanagement of this labeling program;(2) the accuracy of the burden of the

proposed collection of information,including the validity of themethodology and assumptions used; (3)ways to enhance the quality, utility, andclarity of the information to becollected; and (4) ways to minimize the

burden of the collection of informationon those who are to respond, includingthrough the use of appropriateautomated, electronic, mechanical, orother technological collectiontechniques or other forms of informationtechnology. Comments may be sent to:Office of Information and RegulatoryAffairs of OMB, Attention: Desk Officer

for Agriculture, Margaret Malanoski,725 17th Street, NW., Room 10202,Washington, DC 20503. Commentsshould reference OMB control number0503–NEW. All responses to this noticewill be summarized and included in therequest for OMB approval. Allcomments will also become a matter of public record.

I. Government Paperwork EliminationAct Compliance

USDA is committed to compliancewith the Government PaperworkElimination Act (GPEA) (44 U.S.C. 3504

note), which requires Governmentagencies in general to provide the publicthe option of submitting information ortransacting business electronically tothe maximum extent possible. USDA isimplementing an electronic informationsystem for posting informationsubmitted by manufacturers andvendors on the products they intend tolabel under the voluntary labelingprogram for biobased products. Forinformation pertinent to GPEAcompliance related to this rule, pleasecontact Ron Buckhalt at (202) 205–4008.







J. Small Business Regulatory Enforcement Fairness Act

The proposed rule is not a major ruleunder the Small Business RegulatoryEnforcement Fairness Act, 5 U.S.C.804(2). This rule will not have anannual effect on the economy of $100million or more; will not cause a major

increase in costs or prices forconsumers, individual industries,Federal, State, or local governmentagencies, or geographic regions; anddoes not have significant adverse effectson competition, employment,investment, productivity, innovation, orthe ability of U.S.-based enterprises tocompete with foreign-based enterprises.

List of Subjects in 7 CFR Part 2904

Biobased products, Labeling.

For the reasons stated in thepreamble, the U.S. Department of Agriculture (USDA) proposes to amend

7 CFR chapter XXIX as follows:CHAPTER XXIX—DEPARTMENTALADMINISTRATION, DEPARTMENT OFAGRICULTURE

1. A new part 2904 is added tochapter XXIX to read as follows:

PART 2904—VOLUNTARY LABELINGPROGRAM FOR BIOBASEDPRODUCTS

Sec.2904.1 Purpose and scope.2904.2 Definitions.2904.3 Applicability.2904.4 Criteria for product eligibility to use

the label.2904.5 Initial approval process.2904.6 Appeals process.2904.7 Requirements for the use of the

label.2904.8 Violations.2904.9 Recordkeeping requirements.2904.10 Oversight and monitoring.

Authority: 7 U.S.C. 8102.

§ 2904.1 Purpose and scope.

The purpose of this part is to set forththe terms and conditions for voluntaryuse of the ‘‘USDA Certified BiobasedProduct’’ label. This part establishes thecriteria that biobased products must

meet in order to be eligible to becomecertified biobased products to which the‘‘USDA Certified Biobased Product’’label can be affixed, the processmanufacturers and vendors must use toobtain and maintain USDA certification,and the recordkeeping requirements formanufacturers and vendors who obtain

certification. In addition, this partestablishes specifications for the correctand incorrect uses of the label, whichapply to manufacturers, vendors, andother entities. Finally, this partestablishes actions that constitutevoluntary labeling program violations.

§ 2904.2 Definitions.

Applicable minimum biobased content. The biobased content at orabove the level set by USDA to qualifyfor use of the label.

ASTM International (ASTM). Anonprofit organization that provides aninternational forum for the developmentand publication of voluntary consensusstandards for materials, products,systems, and services.

Biobased content. The amount of biobased carbon in the material orproduct expressed as a percent of weight (mass) of the total organic carbonin the material or product. For products

within designated items, the biobasedcontent shall be defined and determinedas specified in the applicable section of subpart B of part 2902. For all otherproducts, the biobased content is to bedetermined using ASTM Method D6866,Standard Test Methods for Determiningthe Biobased Content of Natural RangeMaterials Using Radiocarbon andIsotope Ratio Mass SpectrometryAnalysis.

Biobased product. A productdetermined by the Secretary to be acommercial or industrial product (otherthan food or feed) that is:

(1) Composed, in whole or in

significant part, of biological products,including renewable domesticagricultural materials and forestrymaterials; or

(2) An intermediate ingredient orfeedstock. For the purposes of thissubpart, the term ‘biobased product’does not include motor vehicle fuels,heating oil, electricity produced from

biomass, or any mature marketproducts. Products from a maturemarket will be determined on a case-by-case basis.

Certified biobased product. A biobased product for which the

manufacturer or vendor of the producthas received approval from USDA toaffix to the product the ‘‘USDA CertifiedBiobased Product’’ label.

Days. As used in this part meanscalendar days.

Designated item. For the purposes of this part means a generic grouping of

biobased products designated forpreferred procurement under subpart Bof part 2902 of this title.

Designated representative. An entityauthorized by a manufacturer or vendorto affix the USDA label to themanufacturer’s or vendor’s certified

biobased product or its packaging.Intermediate ingredients or

feedstocks. A material or compoundmade in whole or in significant partfrom biological products, includingrenewable agricultural materials(including plant, animal, and marinematerials) or forestry materials, that aresubsequently used to make a morecomplex compound or product. For thepurposes of this subpart, intermediateingredients or feedstocks do not includeraw agricultural or forestry materials,

but represent those materials that can beput into a new cycle of production andfinishing processes to create finishedmaterials, ready for distribution and

consumption.ISO. The International Organization

for Standardization, a network of national standards institutes working inpartnership with internationalorganizations, governments, industries,

business, and consumer representatives.ISO 9001 conformant. An entity that

meets all of the requirements of the ISO9001 standard, but that is not requiredto be ISO 9001 certified. ISO 9001 refersto the International Organization forStandardization’s standards andguidelines relating to ‘‘qualitymanagement’’ systems. ‘‘Quality

management’’ is defined as what themanufacturer does to ensure that itsproducts or services satisfy thecustomer’s quality requirements andcomply with any regulations applicableto those products or services.

Label. Collectively, the label artwork(as defined in this section) and the

biobased product statement(s),including the applicable biobasedcontent(s).

Label artwork. The certificationmarks, ‘‘USDA Certified BiobasedProduct’’ and the ‘‘USDA CertifiedBiobased Product’’ logo, and, where

applicable, the letters ‘‘FP’’ to indicatethat the product is within a designateditem and eligible for Federal preferredprocurement, as shown in Figure 1.Application of either certification mark

by a manufacturer or vendor signifiesthat USDA has certified that the productmeets the qualifications in this part.





Manufacturer. An entity that performsthe necessary chemical and/ormechanical processes to make a finalmarketable product.

Mature market products. Biobasedproducts that are not eligible fordesignation for BioPreferred preferredprocurement or labeling as definedunder subpart B of part 2902 of this title

because they had significant nationalmarket penetration in 1972. Theeligibility of mature market products forthe voluntary labeling program will beconsidered on a case-by-case basis,

based on manufacturer’s or vendor’sappeal of the exclusion.

Other entity. Any person, group,public or private organization, or

business other than USDA, ormanufacturers or vendors of biobasedproducts that may wish to use the‘‘USDA Certified Biobased Product’’label in informational or promotionalmaterial related to a certified biobasedproduct.

Program Manager. The manager of theBioPreferred Program.

USDA. The United States Departmentof Agriculture.

Vendor. An entity that offers for salefinal marketable biobased products that

are produced by manufacturers.§ 2904.3 Applicability.

(a) Manufacturers, vendors, and designated representatives. Therequirements in this part apply to allmanufacturers and vendors, and theirdesignated representatives, who wish toparticipate in the USDA voluntarylabeling program for biobased products.Manufacturers and vendors wishing toparticipate in the voluntary labelingprogram are required to obtain andmaintain product certification.

(b) Other entities. The requirements inthis part apply to other entities whowish to use the label in promoting thesales or the public awareness of certified

biobased products.

§ 2904.4 Criteria for product eligibility touse the label.

A product must meet each of thecriteria specified in paragraphs (a) and(b) of this section in order to be eligibleto receive biobased productcertification.

(a) Biobased product.(1) Except as specified in paragraph

(a)(2) of this section, the product forwhich certification is sought must be a

biobased product as defined in §2904.2of this part.(2) Products that meet the definition

of mature market products, as defined in§ 2904.2 of this part, will be consideredfor certification only in those caseswhere the Program Manager sustains anappeal by the manufacturer or vendor of the product for inclusion in thevoluntary labeling program, as specifiedin §2904.6(c) of this part.

(b) Minimum biobased content. The biobased content of the product must beequal to or greater than the applicableminimum biobased content, as

described in paragraphs (b)(1) through(b)(4) of this section.(1) Biobased products within

designated items.(i) Product is within a single

designated item. If the product is withina single item that, at the time theapplication for certification issubmitted, has been designated byUSDA for preferred procurement, theapplicable minimum biobased contentis the minimum biobased contentspecified for the item as found insubpart B of 7 CFR part 2902.

(ii) Product is within multipledesignated items. If a biobased productis marketed within more than onedesignated item, uses the samepackaging for each designated item, andthe applicant seeks certification of theproduct, the product’s biobased contentmust meet or exceed the specifiedminimum biobased content for each of the applicable designated items in orderto use the label on the product.However, if the manufacturer packagesthe product differently for eachdesignated item then the applicableminimum biobased contents are thoseestablished under paragraph (b)(1)(i) of this section for each designated item for

which the applicant seeks to use thelabel.

(2) Finished biobased products that are not within designated items.

(i) If the product is not anintermediate ingredient or feedstock andis not within a designated item at thetime the application for certification issubmitted, the applicable minimum

biobased content is 51 percent.Manufacturers, vendors, groups of manufacturers and/or vendors, andtrade associations may propose analternative applicable minimum

biobased content for the product by

developing, in consultation with USDA,and conducting an analysis to supportthe proposed alternative applicableminimum biobased content. If approved

by USDA, the proposed alternativeapplicable minimum biobased contentwould become the applicable minimum

biobased content for the product.(ii) If a product certified under

paragraph (2)(i) of this section is withinan item that USDA subsequentlydesignates for preferred procurement,the applicable minimum biobasedcontent shall become, as of the effective





date of the final designation rule, theminimum biobased content specified forthe item as found in subpart B of 7 CFRpart 2902.

(3) Products that are intermediateingredients or feedstocks and are not within designated items.

(i) If the product is an intermediateingredient or feedstock that is not

within a designated item at the time theapplication for certification issubmitted, the applicable minimum

biobased content is 51 percent.(ii) If a product certified under

paragraph (3)(i) of this section is withinan item that USDA subsequentlydesignates for preferred procurement,the applicable minimum biobasedcontent shall become, as of the effectivedate of the final designation rule, theminimum biobased content specified forthe item as found in subpart B of 7 CFRpart 2902.

(4) [reserved]

§ 2904.5 Initial approval process.

(a) Application. Manufacturers andvendors seeking USDA certification touse the label for an eligible biobasedproduct must submit a USDA-approvedapplication for certification for each

biobased product. A standardizedapplication form and instructions areavailable on the USDA BioPreferredWeb site (http://www.biopreferred.gov ).The contents of an acceptableapplication are as specified inparagraphs (a)(1) through (3) of thissection.

(1) General content. The applicantmust provide contact information andproduct information including all brandnames or other identifying information,

biobased content and testinginformation, product category, intendeduses, and, if applicable, thecorresponding designated item type.The applicant must attach to theapplication documentationdemonstrating that the reported

biobased content was tested by a third-party testing entity that is ISO 9001conformant.

(2) Certifications. The applicant mustcertify in the application that theproduct for which use of the label issought is a biobased product as definedin §2904.2 of this part.

(3) Commitments. The applicant mustsign a statement in the application thatcommits the applicant to submitting toUSDA the information specified inparagraph (c)(1) through (4) of thissection, which USDA will post to theUSDA BioPreferred Web site, and toproviding USDA with up-to-dateinformation for posting on this Web site.

(b) Evaluation of applications.

(1) USDA will evaluate eachapplication to determine if it containsthe information specified in paragraph(a) of this section. If USDA determinesthat the application is not complete,USDA will return the application to theapplicant with an explanation of itsdeficiencies. Once the deficiencies have

been addressed, the applicant may

resubmit the application, along with acover letter explaining the changesmade, for re-evaluation by USDA. USDAwill evaluate resubmitted applicationsseparately from first-time applications,and those with the earliest originalapplication submittal date will be givenfirst priority.

(2)(i) USDA will evaluate eachcomplete application to determinecompliance with the criteria specified in§ 2904.4. USDA will provide a writtenresponse to each applicant within 60days after the receipt of a completeapplication, informing the applicant of

whether the application has beenconditionally approved or has beendisapproved.

(ii) For those applications that areconditionally approved, a notice of certification, as specified in paragraph(c) of this section, must be issued beforethe use of the label can begin.

(iii) For those applications that aredisapproved, USDA will issue a noticeof denial of certification and will informthe applicant in writing of each criterionnot met. Applicants who receive anotice of denial of certification mayappeal using the procedures specified in§ 2904.6.

(c) Notice of certification. Afternotification that its application has beenconditionally approved, the applicantmust provide to USDA (for posting byUSDA on the USDA BioPreferred Website) the information specified inparagraphs (c)(1) through (4) of thissection. Once USDA confirms that theinformation is received and complete,USDA will issue a notice of certificationto the applicant. Upon receipt of anotice of certification, the applicant may

begin using the label on the certified biobased product.

(1) The product’s brand name(s), or

other identifying information.(2) Contact information, including thename, mailing address, e-mail address,and telephone number of the applicant.

(3) The biobased content of theproduct.

(4) A hot link directly to theapplicant’s Web site (if available).

(d) Term of certification.(1) The effective date of certification

is the date that the applicant receives anotice of certification from USDA.Except as specified in paragraphs (2)(i)through (2)(iv) of this section,

certifications will remain in effect aslong as the product is manufactured andmarketed in accordance with theapproved application and therequirements of this subpart.

(2)(i) If the product formulation of acertified product is changed such thatthe biobased content of the product is

reduced to a level below that reportedin the approved application, the existingcertification will not be valid for theproduct under the revised conditionsand the manufacturer or vendor, asapplicable, and its designatedrepresentatives must discontinueaffixing the label to the product andmust not initiate any further advertisingof the product using the label. USDAwill consider a product under suchrevised conditions to be a reformulatedproduct, and the manufacturer orvendor, as applicable, must submit anew application for certification using

the procedures specified in paragraph(a) of this section.

(ii) If the product formulation of acertified product is changed such thatthe biobased content of the product isincreased from the level reported in theapproved application, and themanufacturer wishes to report thehigher value on the label, a newapplication must be submitted using theprocedures specified in paragraph (a) of this section.

(iii) If the product formulation of acertified product is changed such thatthe biobased content of the product is

increased, but the label is not revised,the existing certification will continueto be valid for the product.

(iv) If the applicable requiredminimum biobased content for aproduct to be eligible to display thelabel is revised by USDA, manufacturersand vendors may continue to label theirpreviously certified product only if itmeets the new minimum biobasedcontent level. In those cases where the

biobased content of a certified productfails to meet the new minimum

biobased content level, USDA willnotify the manufacturer or vendor thattheir certification is no longer valid.Such manufacturers and vendors mustincrease the biobased content of theirproduct to a level at or above the newminimum biobased content level andmust re-apply for certification within 60days if they wish to continue to use thelabel. Manufacturers and vendors whohave re-applied for certification maycontinue using the existing label untilthey receive notification from USDA onthe results of their re-application forcertification.








§ 2904.6 Appeal processes.

An applicant for certification mayappeal a notice of denial of certificationto the Program Manager. Entities thathave received a notice of violation, andmanufacturers and vendors of certified

biobased products who have received anotice of suspension or revocation, mayappeal to the Program Manager.

Manufacturers and vendors of maturemarket products may appeal theexclusion of their products from thevoluntary labeling program to theProgram Manager.

(a)(1) Appeals to the Program Managermust be filed within 30 days of receipt

by the appellant of a notice of denial of certification, a notice of violation, anotice of suspension, or a notice of revocation. Appeals must be filed inwriting and addressed to: ProgramManager, USDA Voluntary LabelingProgram for Biobased Products, Room300, Reporters Building, 300 Seventh

Street SW., Washington, DC 20024.(2) All appeals must include a copy of the adverse decision and a statement of the appellant’s reasons for believing thatthe decision was not made inaccordance with applicable programregulations, policies, or procedures, orotherwise was not proper.

(b)(1) If the Program Manager sustainsan applicant’s appeal of a notice of denial of certification, USDA will issuea notice of certification to the applicantfor its biobased product.

(2) If the Program Manager sustains amanufacturer’s or vendor’s appeal of anotice of violation, USDA will rescind

the notice and no further action will betaken by USDA.

(3) If the Program Manager sustains amanufacturer’s or vendor’s appeal of anotice of suspension, the manufacturer,vendors, and their designatedrepresentative(s) may immediatelyresume affixing the label to the certified

biobased product and USDA willreinstate the product’s information tothe USDA BioPreferred Web site.

(4) If the Program Manager sustains amanufacturer’s or vendor’s appeal of anotice of revocation, the manufactureror vendor, and its designated

representatives may immediatelyresume affixing the label to the certified biobased product and sell and distributethe certified biobased product with thelabel. In addition, USDA will reinstatethe product’s information to the USDABioPreferred Web site.

(c)(1) Manufacturers or vendors of mature market products may appeal theexclusion of their products from thevoluntary labeling program if they

believe that special conditions orcircumstances warrant the inclusion of their products in the program. Appeals

to the Program Manager frommanufacturers or vendors of maturemarket products must be filed in writingand addressed to: Program Manager,USDA Voluntary Labeling Program forBiobased Products, Room 300, ReportersBuilding, 300 Seventh Street, SW.,Washington, DC 20024.

(2) Appeals for the inclusion of

mature market products must includedetailed justification showing why theproduct should be allowed to use thelabel.

(3) If the Program Manager sustains amanufacturer’s or vendor’s appeal of itsproduct’s exclusion from the program,the manufacturers or vendors may thenapply for certification to use the label onthat product, as specified in §2904.5(a)of this part.

(4) Mature market products that arecertified by USDA to use the label will

be considered to be ‘‘finished biobasedproducts that are not within designated

items’’ and subject to all provisions of this part that are applicable to thatcategory of certified biobased products.

(d) Appeals of any of the ProgramManager’s decisions may be made to theUSDA Assistant Secretary forAdministration. Appeals must be made,in writing, within 30 days of receipt of the Program Manager’s decision andaddressed to: Assistant Secretary forAdministration, Room 209A, WhittenBuilding, 1400 Independence Avenue,SW., Washington, DC 20250–0103. If theAssistant Secretary for Administrationsustains an appeal, the provisions of paragraph (b) of this section will apply.

§ 2904.7 Requirements associated with thelabel.

(a) Who may use the label? (1) Manufacturers and vendors. Only

manufacturers and vendors who havereceived a notice of certification, ordesignated representatives of themanufacturer or vendor, may affix thelabel to the product or its packaging. Amanufacturer or vendor who hasreceived a notice of certification for aproduct under this part:

(i) May use the label on the product,its packaging, and other related

materials including, but not limited to,advertisements, catalogs, procurementdatabases, promotional material, Websites, or user manuals for that product,according to the requirements set forthin this section; and

(ii) is responsible for the manner inwhich the label is used by itscompanies, as well as its designatedrepresentatives, including advertisingagencies and subcontractors.

(2) Other entities.(i) Other entities may use the label to

advertise or promote certified biobased

products in materials including, but notlimited to, advertisements, catalogs,procurement databases, Web sites, andpromotional and educational materials,as long as the manufacturer or vendor of the product, or one of their designatedrepresentatives, has affixed the label tothe product or its packaging.

(ii) Other entities may use the label

and the BioPreferred Program name ingeneral statements as described inparagraph (b) of this section, as long asthe statements do not imply that a non-certified biobased product is certified.

(b) Correct usage of the label.(1) The label can be affixed only to

certified biobased products and theirassociated packaging.

(2) The label may be used in materialincluding, but not limited to,advertisements, catalogs, procurementdatabases, Web sites, and promotionaland educational materials to distinguishproducts that are certified for use of the

label from those that are not certified.The label may be used inadvertisements for both certified

biobased products and non-certifiedproducts if the advertisement clearlyindicates which products are certified.Care must be taken to avoid implyingthat any non-certified products arecertified.

(3) The label may be used withoutreference to a specific certified biobasedproduct only when informing the publicabout the purpose of the label. Forexample, the following or similar claimis acceptable: ‘‘Look for the ‘USDA

Certified Biobased Product’ label. Itmeans that the product meets USDAstandards for the amount of biobasedcontent and the manufacturer or vendorhas provided relevant information onthe product for the USDA BioPreferredWeb site.’’ This exception allowsmanufacturers, vendors, and otherentities to use the label in documentssuch as corporate reports, but only in aninformative manner, not as a statementof product certification.

(4) The label may appear next to apicture of the product(s) or textdescribing it.

(5) The label must stand alone and not be incorporated into any other label orlogo designs.

(6) The label may be used as awatermark provided the use does notviolate any usage restrictions specifiedin this part.

(7) The text portion of the label must be written in English and may not betranslated, even when the label is usedoutside of the United States.

(c) Incorrect usage of the label.(1) The label shall not be used on any

product that has not been certified by





USDA as a ‘‘USDA Certified BiobasedProduct.’’

(2) The label shall not be used on anyadvertisements or informationalmaterials where both certified biobasedproducts and non-certified products areshown unless it is clear that the labelapplies to only the certified biobasedproduct(s).

(3) The label shall not be used toimply endorsement by USDA or theBioPreferred Program of any particularproduct, service, or company.

(4) The label shall not be used in anyform that could be misleading to theconsumer.

(5) The label shall not be used bymanufacturers or vendors of certifiedproducts in a manner disparaging toUSDA or any other government body.

(6) The label shall not be used withan altered label or incorporated intoother label designs.

(7) The label shall not be used on

business cards, company letterhead, orcompany stationery.(8) The label shall not be used in, or

as part of, any company name, logo,product name, service, or Web site,except as may be provided for in thispart.

(9) The label shall not be used in amanner that violates any of theapplicable requirements contained inthis part.

(d) Imported products. The label can be used only with a product that iscertified by USDA under this part. Thelabel cannot be used to imply that aproduct meets or exceeds the

requirements of biobased programs inother countries. Products imported forsale in the U.S. must adhere to the sameguidelines as U.S.-sourced biobasedproducts. Any product sold in the U.S.as a ‘‘USDA Certified Biobased Product’’must have received certification fromUSDA.

(e) Contents of the label. The labelshall consist of the items specified inparagraphs (e)(1) through (3) of thissection, as applicable.

(1) The label artwork provided by theBioPreferred Program.

(2) The biobased content and

applicable biobased productstatement(s), as specified in paragraph(f)(2) of this section.

(3) The USDA BioPreferred Web siteaddress must also be included on, or inclose proximity to, the label.

(f) Physical aspects of the label.(1) Label artwork. The label artwork

may not be altered, cut, separated intocomponents, or distorted in appearanceor perspective. Labels that are applied to

biobased products that have beendesignated for preferred procurementwill include the letters ‘‘FP’’ as part of

the label artwork. The label must appearonly in the colors specified inparagraphs (f)(1)(i) through (iii) of thissection, unless approval is given byUSDA for an exception.

(i) The three-color version of the labelis preferred. The colors used must bePantone-White, Pantone 356C, andPantone 362C.

(ii) A one-color version of the labelmay be substituted for the three-colorversion as long as one of the followingcolors is used: Pantone 356C or Pantone362C.

(iii) A black and white version of thelabel is acceptable.

(2) Biobased content and applicablebiobased product statement(s). The

biobased content and applicable biobased product statement(s) must beplaced directly below the label artworkand must be displayed in a manner thatmakes it easily readable.

(i) One or both of the following two

statements, as applicable, must be usedto identify the product to which thelabel applies:

(A) Product: XX% biobased.(B) Packaging: XX% biobased.(ii) The biobased content reported in

the biobased product statement(s)specified in paragraphs (f)(2)(i)(A) and(B) of this section shall be expressed as‘‘XX%,’’ where XX% represents theactual biobased content of the productor packaging. The biobased contentdisplayed at the time the label is affixedto the product or its packaging must bethe same as the biobased content

specified in the most recent approvedapplication for the certified biobasedproduct.

(3) The USDA BioPreferred Web siteaddress must be included either on thelabel, below the product statement, if space allows or in close proximity to thelabel on the product or packaging.

(g) Placement of the label.(1) The label can appear directly on a

product, its associated packaging, inuser manuals, and in other materialsincluding, but not limited to,advertisements, catalogs, procurementdatabases, and promotional andeducational materials.

(2) The label shall not be placed in amanner that is ambiguous about whichproduct is a certified biobased productor that could indicate certification of anon-certified product.

(3) When used to distinguish acertified biobased product in materialincluding, but not limited to,advertisements, catalogs, procurementdatabases, Web sites, and promotionaland educational materials, the labelmust appear near a picture of theproduct or the text describing it.

(i) If all products on a page arecertified biobased products, the labelmay be placed anywhere on the page.

(ii) If a page contains a mix of certified biobased products and non-certified products, the label shall beplaced in close proximity to thecertified biobased products. Anindividual label near each certified

biobased product may be necessary toavoid confusion.

(h) Minimum size and clear spacerecommendations for the label.

(1) The label may be sized to fit theindividual application as long as thecorrect proportions are maintained andthe label remains legible.

(2) A border of clear space mustsurround the label and must be of sufficient width to offset it fromsurrounding images and text and toavoid confusion. If the label’s color issimilar to the background color, anoutlining color may be used to enhance

contrast.(i) Where to obtain copies of the label

artwork. The label artwork is availableat the USDA BioPreferred Web site.

§2904.8 Violations.

This section identifies the types of actions that USDA considers violationsunder this part and the penalties (e.g.,the suspension or revocation of certification) associated with suchviolations.

(a) General. Violations under thissection occur on a per product basis andthe penalties are to be applied on a per

product basis. Entities cited for aviolation under this section may appealusing the provisions in § 2904.6. If certification for a product is revoked,the manufacturer or vendor whosecertification has been revoked may seekre-certification for the product using theprocedures specified under theprovisions in § 2904.5.

(b) Types of violations. Actions thatwill be considered violations of this partinclude, but are not limited to, thefollowing specific examples:

(1) Biobased content violations. TheProgram Manager will utilize occasionalrandom testing of certified biobasedproducts to compare the biobasedcontent of the tested product with theproduct’s applicable minimum biobasedcontent and the biobased contentreported by the manufacturer or vendorin its approved application. Such testingwill be conducted using ASTM MethodD6866. USDA will provide a copy of theresults of its testing to the applicablemanufacturer or vendor.

(i) If USDA testing shows that the biobased content of a certified biobasedproduct is less than its applicable





minimum biobased content, then aviolation of this part will have occurred.

(ii) If USDA testing shows that the biobased content is less than thatreported by the manufacturer or vendorin its approved application, but is stillequal to or greater than its applicableminimum biobased content(s), USDAwill provide written notification to the

manufacturer or vendor. Themanufacturer or vendor must submit,within 30 days from receipt of USDAwritten notification, a new applicationfor the lower biobased content. Failureto submit a new application within 30days will be considered a violation of this part.

(A) The manufacturer or vendor cansubmit in the new application the

biobased content reported to it by USDAin the written notification.

(B) Alternatively, the manufacturer orvendor may elect to retest the productin question and submit the results of the

retest in the new application. If themanufacturer or vendor elects to retestthe product, it must test a sample of thecurrent product.

(2) Label violations.(i) Any usage or display of the label

that does not conform to therequirements specified in §2904.7.

(ii) Affixing the label to any productprior to issuance of a notice of certification from USDA.

(iii) Affixing the label to a certified biobased product during periods whencertification has been suspended orrevoked.

(3) Application violations. Knowingly

providing false or misleadinginformation in any application forcertification of a biobased productconstitutes a violation of this part.

(4) USDA BioPreferred Web siteviolations. Failure to provide to USDAupdated information when theinformation for a certified biobasedproduct becomes outdated or when newinformation for a certified biobasedproduct becomes available constitutes aviolation of this part.

(c) Notice of violations and associated actions. USDA will provide theapplicable manufacturer or vendor or

their designated representatives and anyinvolved other entity known to USDAwritten notification of any violationsidentified by USDA. Entities whoreceive a notice of violation for a

biobased content violation must correctthe violation(s) within 30 days fromreceipt of the notice of violation.Entities who receive a notice of violation for other types of violationsmust correct the violation(s) within 60days from receipt of the notice of violation. If the entity receiving a noticeof violation is a manufacturer, a vendor,

or a designated representative of amanufacturer or vendor, USDA willpursue notices of suspensions andrevocation, as discussed in paragraphs(c)(1) and (c)(2) of this section. USDAreserves the right to further pursueaction against these entities as providedfor in paragraph (c)(3) of this section. If the entity receiving a notice of violation

is an ‘‘other entity’’ (i.e., not amanufacturer, vendor, or designatedrepresentative), then USDA will pursueaction according to paragraph (c)(3) of this section. Entities that receive noticesof suspension or revocation may appealsuch notices using the proceduresspecified in § 2904.6.

(1) Suspension.(i) If a violation is applicable to a

manufacturer, vendor, or designatedrepresentative and the applicable entityfails to make the required correctionswithin 30 days (for biobased contentviolations) or 60 days (for other types of violations) of receipt of a notice of violation, USDA will notify themanufacturer or vendor, as appropriate,of the continuing violation, and theUSDA certification for that product will

be suspended. As of the date that themanufacturer or vendor receives anotice of suspension, the manufactureror vendor and their designatedrepresentatives must not affix the labelto any of that product, or associatedpackaging, not already labeled and mustnot distribute any additional products

bearing the label. USDA will issue apress release informing the public of thesuspension and will also remove the

product information from the USDABioPreferred Web site.

(ii) If, within 30 days from receipt of the notice of suspension, themanufacturer or vendor whose USDAproduct certification has beensuspended makes the requiredcorrections and notifies USDA that thecorrections have been made, themanufacturer or vendor and theirdesignated representatives may, uponreceipt of USDA approval of thecorrections, resume use of the label.USDA will also restore the productinformation to the USDA BioPreferred

Web site.(2) Revocation.(i) If a manufacturer or vendor whose

USDA product certification has beensuspended fails to make the requiredcorrections and notify USDA of thecorrections within 30 days of the date of the suspension, USDA will notify themanufacturer or vendor that thecertification for that product is revoked.

(ii) As of the date that themanufacturer or vendor receives thenotice revoking USDA certification, themanufacturer or vendor and their

designated representatives must notaffix the label to any of that product notalready labeled. In addition, themanufacturer or vendor and theirdesignated representatives areprohibited from further sales of productto which the label is affixed.

(iii) If a manufacturer or vendorwhose product certification has been

revoked wishes to use the label, themanufacturer or vendor must follow theprocedures required for originalcertification.

(3) Other remedies. In addition to thesuspension or revocation of thecertification to use the label, dependingon the nature of the violation, USDAmay pursue suspension or debarment of the entities involved in accordance withpart 3017 of this title. USDA furtherreserves the right to pursue any otherremedies available by law, includingany civil or criminal remedies, againstany entity that violates the provisions of

this part.§ 2904.9 Recordkeeping requirements.

(a) Records. Manufacturers andvendors shall maintain recordsdocumenting compliance with this partfor each product that has receivedcertification to use the label, asspecified in paragraphs (a)(1) through(3) of this section.

(1) The results of all tests, and anyassociated calculations, performed todetermine the biobased content of theproduct.

(2) The date the applicant receivescertification from USDA, the dates of

changes in formulation of certified biobased products, and the dates whenthe biobased content of certified

biobased products was tested.(3) Documentation of analyses

performed by manufacturers to supportclaims of environmental or humanhealth benefits, life cycle cost,sustainability benefits, and productperformance made by the manufacturer.

(b) Record retention. For eachcertified biobased product, records keptunder paragraph (a) of this section must

be maintained for at least three years beyond the end of the label certification

period (i.e., three years beyond theperiod of time when manufacturers andvendors cease using the label). Recordsmay be kept in either electronic formator hard copy format. All records kept inelectronic format must be readilyaccessible during a USDA audit.

§ 2904.10 Oversight and monitoring.

(a) General. USDA will conductoversight and monitoring of manufacturers, vendors, designatedrepresentatives, and other entitiesinvolved with the voluntary labeling





program to ensure compliance with thispart. This oversight will include, but not

be limited to, conducting facility visitsof manufacturers and vendors who havecertified biobased products, and of theirdesignated representatives.Manufacturers, vendors, and theirdesignated representatives are requiredto cooperate fully with all USDA audit

efforts for the enforcement of thevoluntary labeling program.

(b) Biobased content testing. USDAwill conduct biobased content testing of certified biobased products, asdescribed in §2904.8(b)(1) to ensurecompliance with this Part.

(c) Inspection of records.

Manufacturers, vendors, and theirdesignated representatives must allow

Federal representatives access to therecords required under § 2904.9 forinspection and copying during normalFederal business hours.

Dated: July 17, 2009.

Pearlie S. Reed,

Assistant Secretary for Administration, U.S.Department of Agriculture.

[FR Doc. E9–17610 Filed 7–30–09; 8:45 am]BILLING CODE 3410–93–P

usda proposed bio preferred label

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