(a) For miscellaneous reasons. An application or a request for service may be rejected, or the benefits of the service may be otherwise denied to, or withdrawn from, any person, without a hearing by the appropriate Regional Director: (1) for administrative reasons such as the nonavailability of personnel to perform the service; (2) for the failure of payment for service; (3) in case the application or request relates to exotic animals or exotic animal products which are not eligible for service under this part; (4) for failure to maintain the designated area or the plant in a state of repair approved by the Service; (5) for the use of operating procedures which are not in accordance with the regulations of this part; (6) for alterations of buildings, facilities, or equipment which cannot be approved under the regulations in this part. Notice of such rejection, denial, or withdrawal, and the reasons therefore, shall promptly be given to the person involved. The applicant or recipient shall be notified of such decision to reject an application or request for service or to deny or withdraw the benefits of the service, and the reasons therefor, in writing in the manner prescribed in §1.147(b) of the rules of practice (7 CFR 1.147(b)), or orally. Such decision shall be effective upon such oral or written notification, whichever is earlier, to the applicant or recipient. If such notification is oral, the person making such decision shall confirm such decision, and the reasons therefor, in writing, as promptly as circumstances permit, and such written confirmation shall be served upon the applicant or recipient in the manner prescribed in §1.147(b) of the rules of practice (7 CFR 1.147(b)).

(b) For disciplinary reasons—Basis for denial or withdrawal. An application or request for service may be denied, or the benefits of the service may be withdrawn from, any person or entity who, or whose officer, employee or agent in the scope of his employment or agency: (1) Has willfully made any misrepresentation or has committed any other fraudulent or deceptive practice in connection with any application or request for service under this part; (2) has given or attempted to give, as a loan or for any other purpose, any money, favor or other thing of value, to any employee or agent of the Department or a cooperating State authorized to perform any function under this part; (3) has interfered with or obstructed, or attempted to interfere with or to obstruct, any employee or agent of the Department or cooperating State in the performance of his or her duties under this part by intimidation, threats, assaults, abuse, or any other improper means; (4) has knowingly represented that any exotic animal carcass, or exotic animal product, has been officially inspected and passed by an authorized inspector under this part, when it had not, in fact, been so inspected; (5) has been convicted of more than one misdemeanor under any law based upon the acquiring, handling, or distributing of adulterated, mislabeled, or deceptively packaged good, or fraud in connection with transactions in food, or any felony; Provided, an application or a request for service made in the name of a person or entity otherwise eligible for service under the regulations may be denied, or the benefits of the service may be withdrawn, from such a person or entity in case the service is or would be performed at a location operated by a person or entity, from whom the benefits of the service are currently being denied or have been withdrawn under this part; or by a person or entity having an officer, director, partner, manager or substantial investor from whom the benefits of service under this part are currently being denied or have been withdrawn under this part, and who has any authority with respect to the location where service is or would be performed; or in case the service is or would be performed with respect to any exotic animal or exotic animal product in which any person or entity, from whom the benefits of service are currently being denied or have been withdrawn under this part, has contract or other financial interest.

(c) Procedure.

(1) An application or request for service may be denied or benefits of the service may be withdrawn by the Secretary, as provided by paragraph (b) of this section, after notice and opportunity for hearing before a designated official of the Department. The Administrator may suspend service under this paragraph without hearing, pending final determination of the matter, when he determines that the public health, interest or safety so requires. The applicant or recipient shall be notified of the Administrator's decision to suspend service, and the reasons therefor, in writing or orally. The Administrator's decision to suspend service under this part shall be effective upon such an oral or written notification, whichever is earlier, to the applicant or recipient. If such notification is oral, the Administrator shall confirm such decision, and the reasons therefor, in writing, as promptly as circumstances permit, and such written confirmation shall be served upon the applicant or recipient in the manner prescribed in 1.147(b) of Departmental rules of practice (7 CFR 1.147(b)).

(2) The written notification specified in paragraph (c) of this section, which shall constitute the complaint in the proceeding, shall briefly set forth the reason for the denial or withdrawal of service, including allegations of fact which constitute a basis for the action. After the complaint is served upon the respondent, as provided in §1.147(b) of Departmental rules of practice (7 CFR 1.147(b)), the proceeding shall thereafter be conducted in accordance with rules of practice which shall be adopted for the proceeding.

[50 FR 41847, Oct. 16, 1985, as amended at 54 FR 1331, Jan. 13, 1989]