The House Appropriations Committee approved on 18 June legislation making appropriations for the operation of the U.S. Department of Agriculture during the fiscal year ending 30 September 2010. Among other things, the legislation includes a provision that would preclude any of the funds made available under the appropriations legislation for FY 2010 to be used to establish or implement a rule allowing poultry products to be imported into the United States from mainland China. Similar provisions were included in the appropriations bills for FYs 2008 and 2009.

While mainland China is not eligible to export to the U.S. poultry products that are slaughtered in domestic establishments, the Food Safety and Inspection Service issued a final rule in April 2006 allowing processed poultry products from China to be imported into the U.S. if they are processed in certified establishments from poultry slaughtered in certified slaughter establishments in other countries eligible to export poultry to the U.S. Among other things, the regulation requires that those poultry products be subject to re-inspection at the pertinent port of entry for transportation damage, labelling, proper certification, general condition, accurate count, defects and microbiological contamination. However, no mainland Chinese facilities have yet been certified to export processed poultry products to the U.S. and Congress has continued to block any such facilities from being certified.

According to various reports, China recently requested the establishment of a WTO dispute settlement panel to examine allegations that these restrictions violate multi-lateral rules. China requested consultations with the U.S. on this issue in April but the two sides have not reached a mutually acceptable agreement. China's request for the formation of a panel will be considered at the 20 July meeting of the Dispute Settlement Body. While the U.S. has the ability to block this request, that action would probably only delay the establishment of the panel by a few days or weeks.

Reportedly, House Appropriations Agriculture Subcommittee Ranking Republican Jack Kingston (Georgia) is trying to amend the appropriations bill language on mainland Chinese poultry to avoid a protracted and possibly losing battle with China at the WTO. Such an amendment would require the FSIS to commit to conduct audits and on-site reviews and enhance its inspection capabilities at U.S. ports of entry before allowing that agency to move forward with the implementation of the rule allowing poultry shipments from the mainland.