FDA will not enforce its food-tracing rule on restaurants up to $1m in sales

The Food and Drug Administration has signalled that it will not hold a large swathe of restaurants and food retailers to its signature food-tracing rule, at least for now. A draft guidance published in the Federal Register on 9 October 2026 says the agency does not intend to enforce the requirements of its Food Traceability Rule against mid-sized retail food establishments and restaurants, widening a carve-out that until now reached only the smallest businesses [s1].

The rule the guidance softens

The Food Traceability Rule was published as a final rule on 21 November 2022 and sits at 21 CFR part 1, subpart S [s1]. It was issued to implement the FDA Food Safety Modernization Act and requires those who handle foods on a designated high-risk list to keep additional records — "key data elements" tied to "critical tracking events" — so that a contaminated product can be traced through the supply chain quickly during an outbreak [s1]. Faster tracing is meant to shorten the window in which tainted food keeps reaching people and sickening them.

The rule already exempts the smallest sellers. Retail food establishments and restaurants whose average annual value of food sold or provided over the previous three years is no more than $250,000 — a rolling figure adjusted for inflation against a 2020 baseline — are fully exempt under 21 CFR 1.1305(i) [s1].

The new enforcement-discretion band

The draft guidance extends relief well above that line. Since the final rule issued, the agency says, retail and restaurant operators have raised the difficulty of complying for businesses that are not small enough to qualify for the existing exemption [s1]. In response, the FDA states it intends to exercise enforcement discretion for all requirements in the Food Traceability Rule for retail food establishments and restaurants with an average annual value of food sold or provided, over the previous three years, of more than $250,000 but no more than $1,000,000 — again on a rolling basis and adjusted for inflation from a 2020 baseline [s1].

In effect, the floor beneath which an operator need not comply would move from a quarter of a million dollars in annual food sales to a full million. Businesses in that new band would not be exempt in law, but the agency is saying it does not plan to enforce the rule's requirements against them.

What it is, and is not

The document is a draft guidance, not a regulation. The FDA issued it under its good guidance practices at 21 CFR 10.115, and the text is explicit that guidance "does not establish any rights for any person and is not binding on FDA or the public," and that an alternate approach is permissible if it meets the underlying statute and rules [s1]. Enforcement discretion is a statement of current intent, not a change to the rule itself, and the agency frames it as resting on its present understanding of the risk [s1].

The FDA is taking comment on the draft through 23 November 2026, under docket FDA-2025-D-6952, before it begins work on a final version [s1].

A parallel conversation on lot-level tracking

Published the same day, a separate notice announces a public meeting titled "Challenges and Solutions in Lot-Level Food Traceability," set for 6 November 2026 from 12:00 to 3:30 p.m. Eastern Time and held virtually [s2]. Its stated purpose is to give the public a forum on continued implementation of the Food Traceability Rule and on areas of concern, "especially as they relate to lot-level tracking," and to identify potential flexibilities to support compliance [s2]. Comments tied to that meeting are due by 6 December 2026 [s2].

Together the two documents point in the same direction: an agency looking for ways to ease the burden of a tracing rule that industry has found hard to operationalise, while leaving the rule itself on the books. The tension is plain enough — the records the rule demands exist to speed outbreak response, and every business moved outside enforcement is one whose products may be slower to trace if something goes wrong. Whether the $1,000,000 line is the right place to draw that trade-off is, for now, the question the comment period is open to answer [s1].