Sysco 2010 Annual Report Download - page 28
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Please find page 28 of the 2010 Sysco annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.United States. While our public company status provides us with some advantages, including access to capital, we believe it also provides us with
some disadvantages that our competitors do not have in terms of additional costs related to complying with regulatory requirements.
Government Regulation
As a marketer and distributor of food products, we are subject to the U.S. Federal Food, Drug and Cosmetic Act and regulations promulgated
thereunder by the U.S. Food and Drug Administration (FDA), as well as the Canadian Food and Drugs Act and the regulations thereunder.
The FDA regulates food safety through various statutory and regulatory mandates, including manufacturing and holding requirements for foods
through good manufacturing practice regulations, hazard analysis and critical control point (HACCP) requirements for certain foods, and the food
and color additive approval process. The agency also specifies the standards of identity for certain foods, prescribes the format and content of
information required to appear on food product labels, regulates food contact packaging and materials, and maintains a Reportable Food Registry for
the industry to report when there is a reasonable probability that an article of food will cause serious adverse health consequences. For certain
product lines, we are also subject to the Federal Meat Inspection Act, the Poultry Products Inspection Act, the Perishable Agricultural Commodities
Act, the Packers and Stockyard Act and regulations promulgated by the U.S. Department of Agriculture (USDA) to interpret and implement these
statutory provisions. The USDA imposes standards for product safety, quality and sanitation through the federal meat and poultry inspection
program.The USDA reviews and approves the labeling of these products and also establishes standards for the grading and commercial acceptance
of produce shipments from our suppliers. We are also subject to the Public Health Security and Bioterrorism Preparedness and Response Act of
2002, which imposes certain registration and record keeping requirements on facilities that manufacture, process, pack or hold food for human or
animal consumption.
In Canada, the Canadian Food Inspection Agency administers and enforces the food safety and nutritional quality standards established by
Health Canada under the Canadian Food and Drugs Act and under other related federal legislation, including the Canada Agricultural Products Act,
the Meat Inspection Act, the Fish Inspection Act and the Consumer Packaging and Labeling Act (as it relates to food). These laws regulate the
processing, storing, grading, packaging, marking, transporting and inspection of certain Sysco product lines as well as the packaging, labeling, sale,
importation and advertising of pre-packaged and certain other products.
We and our products are also subject to state, provincial and local regulation through such measures as the licensing of our facilities;
enforcement by state, provincial and local health agencies of state, provincial and local standards for our products; and regulation of our trade
practices in connection with the sale of our products. Our facilities are subject to inspections and regulations issued pursuant to the U.S. Occu-
pational Safety and Health Act by the U.S. Department of Labor, together with similar occupational health and safety laws in each Canadian province.
These regulations require us to comply with certain manufacturing, health and safety standards to protect our employees from accidents and to
establish hazard communication programs to transmit information on the hazards of certain chemicals present in products we distribute.
We are also subject to regulation by numerous U.S. and Canadian federal, state, provincial and local regulatory agencies, including, but not
limited to, the U.S. Department of Labor and each Canadian provincial ministry of labour, which set employment practice standards for workers, and
the U.S. Department of Transportation and the Canadian Transportation Agency, which regulate transportation of perishable and hazardous
materials and waste, and similar state, provincial and local agencies.
Most of our distribution facilities have ammonia-based refrigeration systems and tanks for the storage of diesel fuel and other petroleum
products which are subject to laws regulating such systems and storage tanks. Other U.S. and Canadian federal, state, provincial and local provisions
relating to the protection of the environment or the discharge of materials do not materially impact the use or operation of our facilities.
Compliance with these laws has not had, and is not anticipated to have, a material effect on our capital expenditures, earnings or competitive
position.
General
We have numerous trademarks which are of significant importance to the company. We believe that the loss of the Sysco(R) trademark would
have a material adverse effect on our results of operations.
We are not engaged in material research and development activities relating to the development of new products or the improvement of
existing products.
Our sales do not generally fluctuate significantly on a seasonal basis; therefore, the business of the company is not deemed to be seasonal.
As of July 3, 2010, we operated 180 distribution facilities throughout the United States, Canada and Ireland.
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