What Are the FSMA 204 Exemptions?

FSMA 204 exempts businesses with annual food sales of $250,000 or less, very small farms, small shell egg producers, foods under USDA jurisdiction, and foods that have undergone a kill step. Additional simplifications exist for farm-to-table purchases, ad hoc purchases between restaurants, and commingled raw agricultural commodities. All thresholds are evaluated on a per-establishment basis using a 3-year rolling average, inflation-adjusted to 2020 dollars (Source: 21 CFR Part 1, Subpart S).

Full exemptions table

| Entity or Situation | Exemption Condition | Result | |--------------------|--------------------|--------| | Very small businesses | Average annual food sales $250,000 or less (3-year avg, inflation-adjusted) | Fully exempt from all FSMA 204 requirements | | Very small farms | Average annual food sales $25,000 or less (3-year avg) | Fully exempt | | Small shell egg producers | Fewer than 3,000 laying hens per farm | Fully exempt | | USDA-regulated foods | Meat, poultry, catfish (Siluriformes) | Not covered -- under USDA jurisdiction, not FDA | | Non-FTL foods | Any food not on the Food Traceability List | Not covered | | Kill step products | Foods that have undergone lethality processing removing them from FTL form | Downstream handlers exempt | | NSSP bivalves | Raw bivalve molluscan shellfish under NSSP programs | Exempt | | USDA feeding programs | Foods for government feeding programs | Fully exempt | | Surplus food donations | Donated surplus food | Fully exempt | | Foods for research/evaluation | Used only for research purposes | Fully exempt |

How does the small business exemption work?

The primary exemption threshold is $250,000 in annual food sales. This is the most relevant exemption for restaurants and small food businesses.

Key details:

Based on all food sold, not just FTL foods
Calculated as a 3-year rolling average
Inflation-adjusted to 2020 dollars
Evaluated per establishment, not per company

What does $250,000 look like in practice?

A food business generating approximately $685 per day in food sales crosses the $250,000 annual threshold. This means the vast majority of commercial restaurants are covered.

For perspective:

A small coffee shop doing $500/day in food sales -- likely exempt
A food truck doing $700/day in food sales -- likely covered
A full-service restaurant doing $2,000/day in food sales -- definitely covered

The exemption is designed to protect the smallest food operations, but most commercial establishments will exceed it.

What are the three compliance tiers?

| Annual Food Sales | Status | Practical Meaning | |------------------|--------|-------------------| | $250,000 or less | Fully exempt | No FSMA 204 requirements | | $250,001 -- $1,000,000 | Modified compliance | Must maintain records, but can use paper or basic digital systems -- no electronic sortable spreadsheet required | | Over $1,000,000 | Full compliance | Must maintain records AND provide them in electronic sortable spreadsheet format when requested by FDA |

The difference between the middle and top tier is the format of records. Businesses in the $250K-$1M range can use paper records. Businesses over $1M must be able to produce records as an electronic sortable spreadsheet (Source: 21 CFR 1.1455).

How do farm exemptions work?

| Farm Type | Threshold | Status | |-----------|-----------|--------| | Produce farms | Average annual food sales $25,000 or less | Fully exempt | | Shell egg producers | Fewer than 3,000 laying hens per farm | Fully exempt | | Farms not growing FTL foods | N/A | Not covered |

The $25,000 farm threshold is significantly lower than the general $250,000 small business threshold. Most commercial farms exceed it.

Farm-to-restaurant purchases

When a restaurant purchases food directly from a farm that grows and ships the food, a meaningful simplification applies:

The restaurant must only maintain the farm's name and address for 180 days
Full receiving KDEs are not required
This only applies when the farm sells and ships directly to the restaurant

This is a significant benefit for farm-to-table restaurant operations.

How does the kill step exemption work?

A kill step is lethality processing that significantly minimizes pathogens, such as cooking to safe temperature, pasteurization, or canning (Source: 21 CFR Part 1, Subpart S).

How it works:

If an FTL food undergoes a kill step and no longer retains its original listed form, downstream handlers are exempt
Upstream handlers (before the kill step) must still comply
The exemption applies to the food's form, not to the entity

Critical nuance for restaurants: The kill step exemption does not exempt restaurants from recording Receiving KDEs for raw FTL foods they receive. Receiving raw salmon and cooking it does not trigger the exemption -- the exemption applies to foods that arrive already processed.

Example: A restaurant receiving pre-cooked, canned salmon does not need to record receiving KDEs for that product (it has already undergone a kill step and is no longer in its FTL form). A restaurant receiving raw fresh salmon must record receiving KDEs, even though they will cook it.

Written agreements for future kill steps

Shippers and receivers can enter a written agreement stating that a kill step will be applied to an FTL food. If the kill step is subsequently applied, this can trigger an exemption from some requirements. The agreement must include:

Effective date
Printed names and signatures
Description of the kill step
Substance of the agreement

How does the ad hoc purchase exemption work?

When a restaurant or retail establishment makes a one-off purchase from another restaurant or retail establishment (outside normal supply chains), simplified requirements apply.

Must record:

Name of product purchased
Date of purchase
Name and address of the selling establishment

Not required:

Full KDEs
TLC tracking
TLC source information

This simplification recognizes that occasional between-restaurant purchases (borrowing supplies from a neighboring restaurant, for example) should not carry the same documentation burden as regular supply chain transactions.

Can you petition for a waiver?

Yes. Any entity can petition the FDA for a waiver from one or more FSMA 204 requirements.

The FDA will grant a waiver when:

The requirements would result in economic hardship due to unique circumstances
The waiver will not significantly impair FDA's rapid identification capabilities during outbreaks

The petition must:

Specify the entity type and requirements covered
Demonstrate economic hardship with supporting data
Demonstrate the waiver will not impair FDA's traceability capabilities
Be filed under 21 CFR 10.30 (citizen petition procedures)

If granted, the waiver is published in the Federal Register with reasoning. Entities with waivers must still maintain 2-year records of their immediate previous source and immediate subsequent recipient. The FDA maintains a public list of all waiver petitions.