The Senate Report, which accompanies the Organic Foods Production Act of 1990, spells out Congress' intention with respect to the role of private certifiers. The Report makes it unequivocally clear that certifiers are to be "partners" with USDA in the certification of producers and handlers of organic foods.

Before launching into the specifics the Report took great care to point out what kind of overall role Congress intended government to have in this legislation. The Report pointed out that Congress agreed with the organic industry, as well as consumer and environmental advocacy organizations, all of whom had "argued for the need to LIMIT SEVERELY the Federal Government's discretionary authority and involvement in this industry since the Government has little experience in this industry." (emphasis mine) The Report then goes on to say that the OFPA proposes "a partnership between government and private organizations in standard setting and certification." (p. 291)

Specifically the Report alludes to several kinds of authority that Congress expects will stay in the hands of private certifiers.. For example, it requires that "all producers and handlers seeking certification submit an organic plan to the certifying agent . . . for the AGENT'S approval." (p. 292) (emphasis mine) This suggests that the decision to approve or reject certification of producers and handlers should be vested in the certifier---whether State or private. This view is further confirmed in that the Report specifically states that with respect to meat and poultry production "organic certification is the responsibility of the certifying agent not USDA meat and poultry inspectors." (p.303)

The Report also states that "certifying agents are provided the authority to assess fees of producers and handlers for the service of certification." (p. 303) USDA, by contrast, is only given authority to "assess fees for certifying agents in order to cover the cost of USDA's accreditation activities." (p. 303)

Finally, the Report states that the "enforcement responsibilities will be SHARED among the Secretary, the governing State officials and the certifying agents." (p. 304) (emphasis mine)

In addition to these specific provisions for private certifiers, the Report specifies that Congress does not want this legislation to "disrupt unnecessarily the organic industry that now exists." (p. 293)

It is clear from these provisions that Congress wanted private certifiers to continue functioning as free agents, within a free market system, as private companies or membership organizations, and that the Government's only intrusion in this private business is to insure that the requirements of the OFPA are met. Congress clearly expected that USDA would work in PARTNERSHIP with such private certifiers, not make them extensions of USDA.

The proposed Rule deviates significantly from that Congressional intent in several key respects.

First, while the Rule DOES allow private certifiers to approve or deny certification, it specifically prevents them from TERMINATING certification. Private certifiers could only "submit to the Administrator a notice of its RECOMMENDATION to terminate the certification . . ." (205.219) Pursuant to receipt of the recommendation to terminate, "the Administrator MAY institute the proceedings to terminate certification." (205.219) (emphasis mine) This provision in the Rule transfers a significant part of the authority normally vested in private certifiers into the hands of government.

Second, and more importantly, the Rule prohibits private certifiers from setting their own fees. The Rule states that private certifiers may "Charge only such fees to applicants for certification and operations it certifies that the Secretary determines are reasonable." (205.301) As we saw above Congress specifically provided for private certifiers to set their own fees in the Senate Report.

Third, the Rule gives the Secretary unlimited authority to impose virtually any other requirements on private certifiers. Private certifiers would have to "Comply with and implement such other terms and conditions deemed necessary by the Secretary." (205.301) This open-ended, arbitrary anomaly, together with the Secretary's authority to set all fees, would turn private certifiers into serfs of the Secretary, rather than free market agents working in partnership with the Secretary.

Finally, the Rule severely restricts the use of private certifier seals, logos and trademarks. The Rule states that private certifiers may use such identifying marks "PROVIDED that (emphasis their's) it "Does not require as a condition of use of its identifying mark compliance with any farming or handling requirements other than those provided for in the Act and the regulations in this part." (205.301)

The effect of these proposed rules is to severely curtail the free enterprise rights of certifiers and unnecessarily vests imperialistic power in the hands of the federal government.

Many private certifiers have been in the certification business for over twenty years. During that time they have registered trademarks that are recognized internationally for upholding quality standards. To now place draconian restrictions on such private enterprise companies by making it illegal to use their identifying logos and trademarks to represent farming and handling practices that in many instances exceed those required in the rule, would amount to a "taking" of their trademarks.

Furthermore, there is no compelling reason to impose such heavy handed government interference on a private business. USDA appears to justify such draconian methods in an effort to establish a UNIFORM standard for organic production and handling. But the Senate Report, again, makes it clear that Congress's intent with this legislation was not to develop a uniform standard, but a "consistent" one.

The Oxford Universal Dictionary defines "consistent" as "standing firm", "settled", "holding together", "agreeing in substance". The Report makes it clear, again and again, that Congress' rationale for establishing a "consistent" standard was not to impose an unvarying standard that would force organic production to be alike in all circumstances, but to set a consistent base standard that would enable farmers to "know the rules", enable consumers to "get what they pay for", and to facilitate "national and international trade in organic foods". (p. 289)

All of this is accomplished through a consistent base standard. The Report even goes so far as to cite the International Federation of Organic Agriculture Movements' (IFOAM) standards as an example of the kind of "harmonization" it seeks to accomplish through the OFPA. (p. 290) And the IFOAM standards, as everyone knows, are precisely designed to bring everyone using the organic label into compliance with a common base standard. In no way does IFOAM prohibit certifiers from imposing ADDITIONAL requirements, and differentiating themselves in the market place for doing so.

The Report even clarifies this issue further by comparing the organic label to other government regulated food labels such as "fresh" and "choice" labels. (p. 290) Those labels are clearly regulated so as to require individuals using them to come up to a common base standard. In no way does the government restrict individuals from exceeding that standard, and being recognized in the market place for doing so.

Furthermore, the OFPA and the Senate Report clearly stipulate that States can "have additional standards." (p. 295) And the Senate Report makes it clear that Congress intends that State and private certifiers be on a level playing field. The Report states that Congress "intends to allow more than one certifying entity to certify within a State" and makes it clear that Congress intends, in this way, "to take advantage of the network of existing entities already engaged in certification." (p. 294)

Again, there is no compelling reason for USDA to impose such heavy handed restrictions on private certifiers. Indeed there are many compelling reasons to allow private certifiers to differentiate themselves in the marketplace, so long as they meet the base requirements of the OFPA. Among those reasons is to give consumers more choice, to encourage producers and handlers to continue improving their craft through market competition, and to provide consumers with special needs (such as the chemically sensitive and allergic) with the opportunity to work with private certifiers to identify foods in the marketplace that meet their special needs.

USDA's insistence on unnecessarily imposing a heavy hand of government in this rule is evident in numerous other instances. USDA, for example, clearly violated the intent of Congress in its establishment of the National List of allowable synthetic materials in the proposed rule. The OFPA specifically prohibits the Secretary from adding synthetic materials to the National List established by the NOSB (sec. 6517) The Senate Report refers to the fact that "organic food is produced using no synthetic materials other than a SMALL LIST of less than 10 exceptions described in the legislation." (p. 292) (emphasis mine) Despite Congress' clear intent to place such restrictions on the National List, the rule cavalierly adds numerous synthetic materials to the National List that the NOSB specifically rejected.

Yet another example of USDA's heavy handed intrusion into this legislation is the fact that the rule uses this legislation to ban most eco-labeling, despite the fact that the Senate Report specifically disallows such prohibitions. The Rule proposes the prohibition of all "labels, labeling or market information that directly OR INDIRECTLY IMPLY organic production and handling practices . . ." and goes on to give a long list of examples of "terms and phrases" USDA would prohibit. These include "pesticide-free", raised without hormones" and "humanely raised." The Report, by contrast, says that such label prohibitions with respect to organic will ". . .NOT AFFECT PRODUCERS WHO CLAIM THAT THEIR PRODUCT IS PRODUCED WITHOUT THE USE OF PESTICIES AS LONG AS THEY MAKE NO DIRECT CLAIM THAT THEIR PRODUCT IS IN ANY WAY ORGANIC OR ORGANICALLY PRODUCED." (pg. 292-293) (emphasis mine)

Taken together, these references in the Senate Report make it clear that USDA has violated the intent of Congress in its promulgation of the organic rule. This is a rule that severely INCREASES, rather than LIMITS "the Federal Government's discretionary authority and involvement" in the organic industry. And it is a rule that grossly intrudes in the affairs of a thriving business (the private organic certification business) and violates fundamental free enterprise and commercial free speech rights.

If this rule is not fundamentally changed, it will force international certifiers doing business in the US, to move out of the country or lose the value of their trademarks.

1/12/98