The «Public Health Security and Bioterrorism Pre-paredness and Response Act» of 2002 (Bioterrorism Act), which has come into force on 12 December 2003 requires all businesses who produce, process, package or store foodstuff for human or animal consumption in the United States to register with the Food and Drug Administration (FDA).

The regulation was issued to allow the American Administration to promptly respond to any terrorist attack delivered through foodstuff contamination, identifying the origin and cause of such threats and immediately informing the areas which might be hit.

Due to the importance of the law which has recently come into full force, the Treviso Chamber of Commerce has organized an event with the purpose of informing foodstuff and beverage exporters to the United States within the scope of its information and updating activity aimed at companies in matters of internationalization. The conference «Exporting to the U.S.A.: market prospects and new fulfilments for foodstuff» was held at the Chamber premises on 4 February 2004 and organised at regional level in cooperation with the Foreign Trade Office of the Veneto Chambers of Commerce.

The presentations by the officers of the National Foreign Trade Institute - ICE - Food and Agriculture sector - clarified the registration’s operative procedures. However, the procedures are also fully explained by the FDA in its website http://www.fda.gov/oc/bioterrorism/bio-act.htm, which contains all necessary information on the registration procedure and relevant forms to be filed on-line. For the purposes of registration with the FDA, exporters have to appoint an agent who resides and works in the United States. The products of a non-registered foreign company cannot be admitted into the United States.

Registration with the FDA is free of charge; it is advisable to register on-line through the www.access.fda.gov/ website which is operative 24 hours a day, seven days a week. The system set up by the agency is able to process electronic registration from any part of the world and the registration number is assigned instantaneously as soon as all required information is inserted. The information to be provided includes business name and full address of the company with telephone contact for any emergency, the firm’s owner or managing director’s details, designated agent in the United States, product categories, trade names used and finally a statement certifying that the information submitted is true and provided by an authorized person.

Registered companies are required to give prior notice to the FDA of every shipment of foodstuff to the United States under penalty of non-admission of goods into the country and their being held at the port of entry. The prior notice will allow the FDA time to examine and assess the information before the arrival of a food product, in order to plan any inspection or to block the contaminated foodstuff.

To support Italian exporters in finding an agent in the United States for the purposes of registration with the FDA, the New York ICE office has a list of consultants who offer this service.

All foodstuff and beverages are subject to prior notice, with the exception of products carried as hand luggage, meat, poultry, eggs and products containing them, since these are subject to specific Agriculture Ministry regulations.

The shipment prior notice can be notified to the FDA directly by the exporter or by the forwarding agents, customs broker, importer or by the agent designated in the United States. The prior notice must be sent electronically through the FDA’s Notice System Interface (www.access.fda.gov ) or the Automated Commercial System (ACS) of the Customs and Border Protection Service (CBP) in case the prior notice is sent by a customs broker. The FDA must receive and electronically confirm the prior notice before arrival of the goods in the US port – at least 4 hours in advance in case of air freight and 8 hours in advance in case of sea freight – and in any case no more than 5 days in advance. It is advisable for the goods to be accompanied by the prior notice confirmation issued by the FDA.

Trade samples, give-aways and goods in transit are also subject to prior notice.For participation to trade fairs in the United States exhibitors can use the registration number temporarily activated by the event’s official forwarding agent, who can also offer the prior notice service.

The prior notice must include information regarding the product shipped, it must state the port of entry and other freight information, the estimated time of arrival, the manufacturing or exporting firm, the person giving prior notice, registration number and consignee of the goods.

The conference was an interesting refresher opportunity on the marketing prospects for Italian wines in the United States. Moreover, it outlined critical juridical-contractual issues connected to sales in the U.S.A. and possible legal implications of appointing a representative at the F.D.A.

The ICE officers’ presentations highlighted how presently the United States are the main market for Italian agricultural and food products, both in terms of market size and development potential, in view of an economic growth scenario characterised by a projected increase in consumption for 2004 of around 2.6%.

The United States rank third (11%) among the main countries of destination of «food made in Italy» after Germany (23.3%) and France (12.1%). Italy is the 6th supplier of food products in the United States, with a 3.5% market share. In 2002 the wine share was 41.7% over a volume of food imports from Italy of 1,894 million dollars. Italy and France are competing for the fist positions in the list of supplying countries, followed by Australia and Chile; Italy ranks first in terms of exported quantities, whereas France ranks first in terms of sold product value. However, Italy ranks first as regards exported white wines, both by quantity and value. In 2003 Australia jumped to the second position by quantity of wine exported to the United States, and conquered the first position for red wines.

The prominent role the United States play as wine makers, however, should not be overlooked - as a matter of fact they rank 4th among producers worldwide.

The main areas of destination of imported wines are New York (6%), Chicago (4.4%), Washington (3.9%), Boston (3.3%) and Los Angeles (2.6%). The market trends in wine imports see a constant increase in consumption, enhanced foreign competition (particularly aggressive from Australia) and an unfavourable euro/dollar exchange rate. The strengths of Italian wine are a high qualitative product image connected to the "Italian life style" connected with the appeal of Italian fashion, tourism and cuisine, as well as a particularly favourable trend for white wines. The threats are posed by the unfavourable exchange rate and the Australian competition. What should be done for Italian wines, then? The ICE experts suggested the following action plan: containing prices to limit the exchange rate effect, maintaining high quality standards, increasing support to importers and distributors in terms of promotional and advertising actions.

Finally, the speakers provided interesting information on wine consumption in the United States, approximately 22% of which is catered for by imports and which records a 2.7% average annual growth. The main consumption areas are California - where national production is concentrated, New York , Florida and Texas. The States which record the highest increases are Florida, Texas and Virginia. In 2000 wine consumption per person in the United States was approximately 7.69 litres - concentrated mainly in December – compared with 58.15 litres consumed in France, 53.44 in Italy and 15.37 in the United Kingdom. Wine consumption mainly involves consumers between35 and 45 years of age, highly educated and with high incomes. The forecast for the next 5 years shows a constant increase in consumption of around 2.3% yearly.

After the scheduled presentations, interested marketers met the experts in the afternoon for short individual interviews which had been previously fixed by appointment.

Edy Bombonato
Excerpt from "Economy in the Treviso Area", February 2004