HBA-MPM C.S.H.B. 3598 77(R) BILL ANALYSIS Office of House Bill AnalysisC.S.H.B. 3598 By: Capelo Public Health 4/10/2001 Committee Report (Substituted) BACKGROUND AND PURPOSE Currently, the Texas Department of Health (TDH) regulates distressed food, drugs, devices, and cosmetics for the purpose of reintroducing these goods into normal commerce. TDH regulates the goods using applicable provisions of the Texas Food, Drug, and Cosmetic Act and the Texas Food, Drug, Device, and Cosmetic Salvage Act. These two acts work in unison to protect consumers from unnecessary health risks associated with adulterated and misbranded products. C.S.H.B. 3598 clarifies the authority granted to TDH through the Texas Food, Drug, and Cosmetic Act as it applies to licensed salvagers. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the Texas Board of Health in SECTION 7 (Section 432.011, Health and Safety Code) of this bill. ANALYSIS C.S.H.B. 3598 amends the Health and Safety Code to provide that the Texas Food, Drug, and Cosmetic Act applies to a food, drug, device, or cosmetic that is distressed merchandise or has been subject to reconditioning in accordance with the Texas Food, Drug, Device, and Cosmetic Salvage Act. The bill provides that in relation to distressed merchandise, law prohibiting the introduction, delivery, holding, receipt, or distribution in commerce of goods that are adulterated or misbranded does not prohibit the introduction, delivery, holding, or receipt in commerce for the purpose of reconditioning according to the Texas Food, Drug, Device, and Cosmetic Salvage Act. The bill prohibits the commissioner of health (commissioner) or an authorized agent from detaining or embargoing an article, including an article that is distressed merchandise, that is in the possession of a person licensed under the Texas Food, Drug, Device, and Cosmetic Salvage Act and that is being held for the purposes of reconditioning unless the commissioner or agent finds or has probable cause to believe that the article cannot be adequately and lawfully reconditioned. The bill authorizes the Texas Department of Health (TDH) to detain or embargo an article, including distressed merchandise that is in the possession of a person licensed under the Texas Food, Drug, Device, and Cosmetic Salvage Act and that is being held for reconditioning if TDH has reason to believe that the article cannot be adequately and lawfully reconditioned. The bill provides an affirmative defense to prosecution under these provisions if the conduct charged is exempt because the actions were for the purposes of reconditioning. C.S.H.B. 3598 provides that a salvage operator or salvage broker who is engaging only within the scope of the license issued Texas Food, Drug, Device, and Cosmetic Salvage Act is not required to also be licensed under the Texas Food, Drug, and Cosmetic Act. The bill requires the Texas Board of Health to adopt rules prescribing standards for salvaged food, drugs, devices, and cosmetics in separate subchapters. EFFECTIVE DATE On passage, of if the Act does not receive the necessary vote, the Act takes effect September 1, 2001. COMPARISON OF ORIGINAL TO SUBSTITUTE C.S.H.B. 3598 differs from the original bill by specifying that regarding distressed merchandise, law prohibiting the introduction or delivery, receipt, or distribution in commerce of goods that are adulterated or misbranded does not prohibit the holding of merchandise for the purpose of reconditioning according to the Texas Food, Drug, Device, and Cosmetic Salvage Act. The substitute modifies the definition of "distressed merchandise" to include any food, drug, device, or cosmetic that has been subjected to conditions that result in either its strength, purity, or quality falling below that which it purports or is represented to possess. The substitute also removes provisions from the original exempting a person who holds a license under the Texas Food, Drug, Device, and Cosmetic Salvage Act as a food manufacturer or food wholesaler. The substitute requires the board to adopt rules prescribing standards for salvaged food, drugs, devices, and cosmetics in separate subchapters.