The Food and Drug Administration said Thursday that it does not plan to enforce any requirement of its Food Traceability Rule against food retailers and restaurants with yearly food sales of $250,000 to $1 million, laying out the policy in draft guidance that would extend relief to businesses the regulation had spared only in part.
The rule, which the agency finalized in 2022 as part of its work under the Food Safety Modernization Act, requires covered companies to keep detailed supply chain records and hand them to the FDA within 24 hours when the agency is tracing a recall or an outbreak linked to contaminated food. Retailers and restaurants with no more than $250,000 in yearly food sales are already fully exempt. Those under $1 million are excused from some provisions, such as the electronic sortable spreadsheet, but they must still keep records that investigators could draw on during an outbreak.
Under the draft, a business's sales would be averaged over the previous three years on a rolling basis and adjusted for inflation from a 2020 baseline. The FDA said it acted on feedback from stakeholders after concluding the change would have little effect on public health. In its view, the new flexibility "would only impact a small percentage of total food sales," so the rule keeps its intended public health benefits while a large number of smaller stores and restaurants get relief.
The Federal Register notice says retailers and restaurants have described the difficulty of complying for small businesses that are still too large for the existing exemption. The agency did not specify which challenges prompted the proposal, Bloomberg Law reported. Grocery trade groups have warned that the rule would hit small retailers hardest because many lack the money and workers needed to comply.
The guidance is a draft, and even in final form it would not be binding on the agency or the public. The notice says the FDA will weigh comments on any costs or savings the policy could produce, a review it tied to Executive Order 14192.
The agency plans further flexibility beyond the policy for small retailers and restaurants and has scheduled a public meeting for Nov. 6, one of a series of sessions Congress directed in the spending law that ended the government shutdown in November 2025. Topics on the table include letting distributors use a reasonable range of lot codes on shipments to stores, along with how records should be kept for returns, for single items removed from a case and for shipments between a company's own locations.
The compliance deadline was originally January 2026 and has since been pushed back 30 months to July 2028. Congress prohibited the FDA from spending federal funds to enforce the rule before that date, a delay that followed intense lobbying by food industry groups worried about cost and operational complexity, according to Bloomberg Law.
Food safety advocates have objected to the delay. Consumer protection groups focused on food safety say it hampers outbreak investigations, a complaint sharpened by this summer's cyclosporiasis outbreak, the largest the United States has recorded. In an August letter to House and Senate leaders, the Safe Food Coalition argued that the rule, had it been in force, could have limited the size and public health toll of the lettuce-linked outbreak. According to Bloomberg Law, the guidance arrived days after the FDA closed its investigation into a cyclospora outbreak this summer that sickened tens of thousands of people, an outbreak whose source public health experts and former agency officials say could have been found faster with the rule in place.
The FDA wants comments on the draft by Nov. 23, before it starts work on a final version. People who hope to speak at the November meeting must register by Oct. 26, and general registration runs through Nov. 5.