The Brazilian market for products containing bovine-derived milk or gelatin components (i.e., whey, bovine-derived gelatin capsules) is growing rapidly. But, for some Brazilian finished-product manufacturers, packagers, and retailers of these products, entering the U.S. sports and wellness market promises to boost profits to levels not attainable through only Brazilian domestic sales.
The first step to selling products containing milk ingredients of bovine origin in the USA is to obtain a veterinary permit from the United States Department of Agriculture (USDA) to import and/or transport controlled materials, or vectors. This veterinary permit customarily requires that a full-time salaried veterinarian of the agency responsible for animal health of the Brazilian Government (MAPA1 or ANVISA) certify that the exported milk or gelatin components derived from bovine originate from New Zealand and/or the USA (milk components) and Peru (bovine-derived gelatin).
But, what if after obtaining the import permit from the USDA, neither MAPA nor ANVISA will agree to provide the requisite certification of origin? Under certain circumstances and conditions discussed below, in working with the USDA/Animal Plant Health Inspection Service (APHIS)/National Import Export Services (NIES) one can achieve a customized veterinary permit that does not require certification by the Brazilian Government and that authorizes the permit holder to self-certify the origin of the bovine-derived milk or gelatin components.
Problem Case Study
BrazilCo is a vertically integrated finished-product manufacturer, packager, and retailer of sports-nutrition products headquartered in Brazil.
- BrazilCo does not manufacture the raw materials used in its finished-product manufacturing process.
- BrazilCo imports the raw materials from third-party foreign suppliers and converts the raw material into finished products ready for market distribution.
- The finished-product manufacturing and packaging facility is located in Brazil.
- In addition to selling its finished products in Brazil, BrazilCo would like to export finished goods to the United States of America.
BrazilCo applied for and was issued a USDA Veterinary Permit (the “Permit”) to import and export controlled materials, organisms, and vectors.
- The Permit authorized BrazilCo to import dietary supplements containing milk ingredients of bovine origin and bovine-derived gelatin.
- The Permit required that a full-time salaried veterinarian of the agency responsible for animal health of the Brazilian Government certify that the exported milk or gelatin components derived from bovine originate from New Zealand and/or the USA (milk components) and Peru (bovine-derived gelatin).
- BrazilCo operates under the jurisdiction of ANVISA. But, MAPA approved the safety of the bovine-derived milk or gelatin components at customs upon entry into Brazil.
Neither MAPA nor ANVISA would provide BrazilCo with the certification required by the USDA.
- MAPA would not certify because BrazilCo’s finished product is not 100 percent an animal product. BrazilCo adds flavoring, color, and other ingredients during its dry manufacturing process.
- ANVISA would not certify because BrazilCo’s finished product was to be exported, and ANVISA’s jurisdiction is only over products sold domestically.
Accordingly, BrazilCo seemingly had two options: (1) persuade MAPA to make a jurisdictional exception and issue a certification for a company that it does not regulate; or (2) persuade ANVISA to certify the origin of the ingredients because ANVISA has jurisdiction, though the goods are indisputably not for Brazilian domestic consumption.
BrazilCo negotiated with USDA/APHIS/NIES a customized permit that does not require certification by the Brazilian Government. Rather, the customized permit authorizes to BrazilCo to self-certify the origin of the bovine-derived milk or gelatin components, the pasteurization process to which these components were subjected, and the capacity of BrazilCo’s packaging process to avoid the commingling of products containing ingredients of approved origin with those containing unapproved ingredients.
The following are the legal considerations and the factual circumstances that made it possible to obtain this customized permit that authorized self-certification:
- BrazilCo does not manufacture the milk ingredients from bovine origin that are used in its finished-product manufacturing process. The raw materials are sourced from third-party suppliers, and BrazilCo converts the bovine-derived milk or gelatin components into fully-finished products that are finally-packaged, commercially labeled, ready for market distribution, and shelf stable.
- BrazilCo produced documentary proof that the bovine-derived milk or gelatin components contained in its products are sourced from cows raised on New Zealand or USA farms where there have not been cases of foot and mouth disease.
- BrazilCo sources bovine-derived milk or gelatin components from manufacturers that implement USDA-approved, heat-treatment, pasteurization procedures that ensure that the milk components do not present a risk of foot and mouth disease.
- BrazilCo uses a state-of-the-art, SAP-like inventory management system to prevent the exposure or comingling of its final product with any other animal origin ingredients not authorized by the Permit during the packaging of the product and prior to exportation.