Under the Food Safety Modernization Act (FSMA) Produce Safety Rule, a farm is eligible for a qualified exemption and associated modified requirements (described in 21 CFR 112.6) if (1) the farm’s food sales averaged less than $500,000 per year in the previous three years and (2) the average value of the farm’s sales to qualified end users exceeded the average value of the farm’s sales to all others during the previous three years. A qualified end user is either (a) consumer of the food or (b) a restaurant or retail food establishment located either in the same state or Indian reservation as the farm or within 275 miles of the farm.

On May 22nd the FDA released a temporary guidance (the “Guidance”) which states that for the year 2020 (and any subsequent years affected by COVID-19), the FDA will not enforce the requirement that a majority of sales be made to qualified end users. Instead, farms may remain eligible for a qualified exemption in 2021 provided that they submit documentation showing compliance with the qualified end user requirement in 2017-2019 (or years that the farm was in operation), or in the case of farms beginning sales in 2020, based on the projected sales to qualified end users in the absence of the COVID-19 pandemic. Importantly, this Guidance does not apply to farms that are not able to show compliance with the qualified end user requirement prior to 2020.

The increased flexibility afforded by the Guidance recognizes the disruptions to the supply chain that the COVID-19 pandemic has caused and allows farms to shift sales to available buyers without losing their eligibility for the qualified exemption.