EPA Grants First ‘Conditional’ Approval Under TSCA Reform

EPA recently approved a new chemical additive subject to the conditions of the polymer exemption criteria.  The Agency found that the chemical substance is “not likely to present an unreasonable risk” under TSCA (5(a)(3)(C)), so long as it meets the requirements of the polymer exemption as described under 40 CFR §723.250(e)(1).  Specifically the Agency found that the substance presents both a low human hazards and a low environmental hazard.  The requirement that “the chemical must be manufactured such that it meets the polymer exemption criteria” gives little insight into restrictions that EPA might impose on future conditional approvals.

EPA’s Determination for Premanufacture Notice explains that although the agency estimates that the new chemical substance will be very persistent, it is unlikely that the chemical substance would present an unreasonable risk, given that it has low potential for bioaccumulation, low human health hazard, and low environmental hazard.  The Determination’s discussion of potential exposures is particularly interesting.  The Agency explained that, although the exposure to a new chemical substance is potentially relevant to whether a new chemical substance is likely to present unreasonable risks, EPA did not estimate the exposure.  The Agency elected not to estimate exposure because the substance present low health and environmental hazard.  The Determination concludes that, “Due to low hazard, EPA believes that this chemical substance would be unlikely to present an unreasonable risk even if exposures were high.”

The name of the substance was claimed confidential business information, as was the manufacturers name. The generic substance name is 2–alkenoic acid, 2–alkyl–, alkyl ester, polymer with 2–alkyl 2–propenoate and a-(2–alkyl-1-oxo-2-alken-1-yl-[iquest]-alkoxypoly(oxy-1,2-alkanediyl), ester with a–2–alken–1–yl–[iquest]–hydroxypoly(oxy–1,2–alkanediyl).

The approval, announced online on May 12, 2017, was the first time EPA has approved a new chemical with a condition since the Toxic Substances Control Act was amended in June 2016.

EPA Reopens Consultation on TSCA Small Manufacturer and Small Processor Definition

The EPA reopened its consultation with the public regarding the definition of “small manufacturer” and “small processor” under the Frank R. Lautenberg Chemical Safety for the 21st Century Act, which amends the Toxic Substances Control Act (TSCA).

TSCA, as amended, requires EPA to review the size standards for small manufacturers and processors, which are currently used in connection with reporting regulations under TSCA Section 8(a). EPA preliminary decided that a revision in the size standards was warranted, but it wanted the public’s input as well. As such, EPA requested public comment on whether a revision of the current size standard definitions is necessary. It also requested a consultation with the Small Business Association to review the definition.

The comment period ended in January, but EPA is now accepting further comment on this issue until May 24, 2017.

New York to Require Manufacturers to Disclose Chemical Ingredients in Cleaning Products

New York announced the launch of its Household Cleansing Product Information Disclosure Program on April 25, 2017. This program will require manufacturers of household cleaning products sold in New York to disclose – on their websites – information on the chemical ingredients of those products. The state has issued draft guidance on the disclosure requirements and the Household Cleansing Product Information Disclosure Program Certification Form. Public comment on the form will be accepted through June 14, 2017. Manufacturers are to post all required information by no less than six months following publication of the final guidance document. In a press release announcing the program, the governor’s office noted that this program will serve as a pilot for potential expansion to other consumer products of concern, such as personal care or children’s products.

The Household Cleansing Product Information Disclosure Program is based on New York’s Environmental Conservation Law Article 35 enacted in the 1970s. It authorizes the state to require manufacturers to furnish product information for the public record. These requirements have been codified in the state’s Code of Rules and Regulations (NYCRR) at Part 659.6.

Detailed instructions for posting the information required are provided in the guidance document. The guidance discusses where on a manufacturer’s website the information should be located. It also notes that “information disclosed under this program must not be restricted from indexing by search engines, such as Google and Bing.”

Information requirements include

• Whether the product contains fragrance ingredients, including ingredients added to mask the scent of other ingredients (solvents, surfactants, etc.) in so-called “unscented” products;
• Intentionally added ingredients;
• Trace quantities; and
• Ingredients present only as an unintentional consequence of manufacturing.

Manufacturers will also be required to report on which of the chemicals in their products have been subject to the GreenScreen® comparative chemical hazard assessment (for information on the GreenScreen® Benchmark program see, the Clean Product Action website). In addition, manufacturers must disclose whether their products contain any nanomaterials and whether any of the chemicals in their products are included on a list of chemicals of concern (for information on the lists of chemicals of concern at issue, see the guidance document).

Manufacturers will be required to update their disclosures each time the ingredients in a product are changed, or a new product is introduced to the market.

Petition for Toxicity and Exposure Testing on Flame Retardants Denied

On April 12, 2017, EPA published a notice in the Federal Register denying a TSCA section 21 petition regarding a group of flame retardants.  EPA explained that the petition did not demonstrate that there was insufficient data on these chemicals, and therefore the EPA found that the testing requested was not necessary.   The petition was submitted by Earthjustice, Natural Resources Defense Council, Toxic-Free Future, Safer Chemicals, Health Families, BlueGreen Alliance, and Environmental Health Strategy Center (“Earthjustice Petition”).

Under TSCA section 21, any person can petition EPA to initiate a rulemaking for the issuance, amendment, or repeal of a rule under TSCA section 4, 6, or 8 or an order under TSCA section 4 or 5(e) or (f).  The Earthjustice petition asked EPA to issue an order under section 4, requiring toxicity and exposure tests testing on particular flame retardants.  The flame retardants at issue are chlorinated phosphate esters (“CPE”).  The CPE Cluster is comprised of

  • tris(2-chloroethyl) phosphate ((“TCEP”) (CAS No. 115-96-8),
  • 2-propanol, 1-chloro-, phosphate (“TCCP”) (CAS No. 13674-84-5), and
  • 2-propanol, 1,3- dichloro, phosphate (“TDCPP”) (CAS No 13674-87-8).

These substances had previously been evaluated during EPA’s TSCA Work Plan Chemical Problem Formulation and Initial Assessment.  Millions of pounds of the substances are manufactured and imported annually.

The Federal Register notice explained that EPA must make several findings in order to issue a rule or order to require testing under section 4.  EPA must find that information and experience are insufficient to reasonably determine or predict the effects of a chemical substance on health or the environment and that testing is necessary to develop the missing information.  EPA must also find that the chemical substance may present an unreasonable risk of injury under section 4.  EPA did find that the manufacture, distribution in commerce, processing, use, or disposal of the CPE Cluster chemicals may present an unreasonable risk of injury to health or the environment.  However, EPA stated that the petitioners failed to demonstrate that the information and experience available to EPA are insufficient to reasonably determine or predict the effects on health or the environment from “manufacture, distribution in commerce, processing, use, or disposal” (or any combination of such activities) of the CPE Cluster chemicals, and therefore the Agency found that the testing requested by the petitioners is unnecessary.

In March, EPA denied a section 21 petition by Earthjustice and others to require additional testing on the flame retardant tetrabromobisphenol A (CAS No. 79-94-7).

Trump Administration Issues Guidance on the Executive Order, “Reducing Regulation and Controlling Regulatory Costs”

On April 5, 2017, the Trump Administration issued guidance on Executive Order (EO) 13771, “Reducing Regulation and Controlling Regulatory Costs.” The guidance, published by the Office of Information and Regulatory Affairs (OIRA), provides details on the policy established by the January 30, 2017 executive order that requires agencies to repeal two existing regulations for each new regulation they promulgate. This guidance supersedes the previous interim guidance published in February, and it reflects OIRA’s consideration of the comments received in response to the interim guidance.

EO 13771 mandates that for every new regulation issued, at least two prior regulations should be eliminated. For fiscal year (FY) 2017 and moving forward, the heads of all agencies are directed that the total incremental cost of all new regulations, including the cost savings associated with eliminating the two prior regulations, must be no greater than zero—unless otherwise required by law or consistent with written advice of the director of the Office of Management and Budget (OMB). The term ”total incremental cost” means the sum of all costs from EO 13771 regulatory actions minus the cost savings from EO 13771 deregulatory actions.

It appears that the EO is based solely on “cost.” In the interim guidance, the administration dictated that “costs” are to be measured as the “opportunity cost to society” and referenced OMB Circular A-4 to define this concept. In the April guidance, the administration dictated that “opportunity cost” would equal the sum of consumer and producer surplus, minus any fixed costs, and also referenced OMB Circular A-4. OMB Circular A-4, issued Sept. 17, 2003, does not actually define “opportunity cost to society.” Instead, it provides guidance for conducting a cost-and-benefit analysis as required by Executive Order 12866 issued by President Clinton in 1993, which applies to rulemakings that establish new rules as well as those that rescind or modify existing rules. OMB Circular A-4’s only reference to “opportunity cost” describes the concept in terms of “willingness-to-pay,” or the measure of “what individuals are willing to forego to enjoy a particular benefit,” as well as the amount of compensation individuals are “willing to accept” to forego the benefit. The OMB Circular A-4 may well be unhelpful in making a “zero-cost” analysis, as EO 13771’s focus is on monetary costs, and “opportunity costs” are difficult to estimate. Indeed, it is difficult to imagine a situation for implementing a regulation or even deregulating in which the cost is “zero.”

The April guidance notes that, in general, agencies can comply with the requirements of the EO by issuing two “deregulatory actions” for each new “regulatory action.” Beginning with FY 2018 and moving forward, the EO requires OMB to identify for each agency the total amount of incremental costs for all deregulatory and regulatory actions finalized during the fiscal year, based on the information that was submitted to OMB by each agency. The guidance defines “EO 13771 regulatory actions” as either: 1) a “significant regulatory action” (i.e., has an annual effect on the economy of $100 million or more, among other things. See EO 12866 3(f)) that has already been finalized and that imposes total costs greater than zero, or 2) a “significant guidance document” with costs above zero that has been finalized. The guidance further defines a “significant guidance document” as one that is reasonably anticipated to have a major impact on the economy, create inconsistency with an action taken or planned by another agency, materially alter the budgetary impact or entitlements, grants, user fees, or loan programs or the rights and obligations of the recipients thereof, or raise novel legal or policy issues.

The guidance defines a “deregulatory action” as an action that has been finalized and has total costs less than zero. It is unclear from the EO and guidance what “total costs less than zero” means. A “deregulatory action” qualifies as both: (1) one of the actions used to satisfy the provision to repeal or revise at least two existing regulations for each regulation issued, and (2) a cost savings for purposes of the total incremental cost allowance. “Deregulatory actions” can be issued in multiple forms, including rulemaking, guidance or interpretive documents, certain actions related to international regulatory cooperation, and information-collection requests that repeal or streamline recordkeeping, reporting, or disclosure requirements.

EO 13771 applies to each “executive department or agency,” but leaves a number of government regulatory functions outside of its scope. These include agencies involved in military, national security, and foreign affairs functions, as well as any government organization arising from the Legislative or Judicial branches. Also exempt are regulations that are legislative rules that qualify for a “good cause” exemption or for which compliance with the terms of EO 13771 would be impracticable or contrary to the public interest. Importantly, the guidance does not indicate which entity is ultimately responsible for making such determinations. Some other exemptions include expressly exempt actions, emergency actions, statutorily or judicially required actions, and de minimis actions.

On its face, EO 13771 could have a significant impact on the pace of federal rulemaking during the Trump Administration, however it remains to be seen what the practical impact of the EO will be. Further, it appears based on the EO itself and the guidance published thus far, it will be difficult for agencies to determine “cost” of implementing and eliminating regulations.

Note: There will be more guidance forthcoming relating to other aspects of the EO, such as Section 3, which concerns the “Annual Regulatory Cost Submissions to the Office of Management and Budget.” Hopefully the forthcoming guidance will shed more light into the EO and its requirements.

Irene Hantman to present at American Chemical Society 253rd National Meeting in San Francisco April 4

The symposium is titled, “Recent Developments in TSCA Regulation — New Requirements for Chemicals in Commerce.” Ms. Hantman will be presenting with:

  • Maria Doa, Director, Chemical Control Division, Office of Chemical Safety and Pollution Prevention, EPA
  • David Liu, Principal Ramboll Environ
  • Keith Matthews, Counsel, Wiley Rein LLP

The symposium will include an overview of TSCA and the Lautenberg Amendments, discuss regulatory updates from EPA including changes to how the Agency evaluates new chemicals, and discuss implications for chemicals in commerce such as changes to CBI protections and the Nanomaterials Reporting Rule. The program abstract is provided below.

The June 22, 2016 enactment of the Frank R. Lautenberg Chemical Safety for the 21st Century Act effectuated a sea change in U.S. chemicals regulatory policy and imposed many new requirements on EPA and the manufacturers, importers, and processors of chemical substances. Some requirements took effect the moment President Obama signed the Act; other changes will be implemented over the next few years. Lautenberg mandates that the Agency issue a number of new rules by June 2017. To meet this schedule, EPA will be taking and responding to comments on its proposals during the spring of 2017. Proposed rules will affect the identification of chemicals currently in commerce through a TSCA “Inventory Reset,” and how EPA assesses the risks presented by these chemicals. The Inventory Reset process could have significant impacts on a company’s ability to continue routine manufacturing activities (for example, substances classified as inactive will not be allowed in commerce, or there may be questions about the actual identity of compounds now in commerce). Importantly, the final rules implementing the Prioritization and Risk Assessment processes will determine the processes and criteria that EPA will use to identify high priority chemicals for risk evaluation, how it will evaluate the risks presented by these chemicals and the amount of flexibility that EPA will allow in these processes. In addition, the Agency will revisit the Confidential Business Information (CBI) claims on chemicals presently in commerce, including claims that withhold the actual identity of chemicals. Submitters will be required to substantiate past claims to continue receiving CBI protections.

* * * * *

For a copy of the presentations contact Ms. Hantman at ihantman@verdantlaw.com.

Processors and Downstream Users Comment on the Inventory Reset Proposed Rule, Asking for Clarity

On January 13, 2017, the EPA published a proposed rule to reset the TSCA Inventory into separate lists of “active” and “inactive” substances (i.e., inventory reset). The proposal details notification requirements and establishes exemptions and procedures for handling confidentiality claims. Properly notified substances would be designated by EPA as “active,” whereas substances without a valid notification would be designated as “inactive.”

Once designated, “inactive” substances could not properly be manufactured, imported, or processed for a non-exempt commercial purpose under TSCA. For inactive substances, EPA proposed “forward-looking” procedures for notifying inactive substances if and when non-exempt manufacture, import, or processing would resume in the future. Properly notified substances would be converted by EPA to “active” substances.

Many comments to the proposed rule were received from interested parties, including coalitions and trade associations – examples are provided below.

A downstream user coalition has questioned the proposed requirement under the TSCA inventory reset proposed rule that a processor of an inactive substance submit notification to the EPA prior to its use. The Chemical User Coalition (CUC), a cross-industry group of nine major companies, including Intel, Boeing, Honda and Procter & Gamble, said in its comments that the inventory reset provisions should only be relevant to reporting, and a failure to adhere to the notification deadline should constitute a reporting violation, not affect a company’s ability to process substances on the inventory.

IPC, the Association Connecting Electronics Industries, in its comments requested clarification of the term “processors” stating that the definition currently in place is “overly simple and prone to misinterpretation.” Specifically, IPC requested that EPA clarify that processing does not include assembling parts into articles, when it does not involve the preparation of a chemical substance or mixture.

Others pointed out that because processors are not required to report pre-manufacture notices or under the Chemical Data Reporting rule, that many would be wholly unfamiliar with the EPA’s CDX reporting system.

The comment period on the inventory rest proposed rule ended March 14, 2017.

CPSC Settles with NRDC Regarding the Restriction of Phthalates in Children’s Toys

The U.S. Consumer Product Safety Commission (CPSC) and the Natural Resources Defense Council (NRDC) have reached an agreement in principle for the federal agency to issue a rule banning five chemicals, known as phthalates, that may cause reproductive harm from their exposure in children’s products. Those five phthalates are: diisobutyl phthalate (DIBP), di-n-pentyl phthalate (DnPP), di-n-hexyl phthalate (DnHP), dicyclohexyl phthalate (DCHP); and diisononyl phthalate (DINP). While the CPSC reached a tentative agreement with the NRDC on the timetable for issuing a rule, the contents of the final rule will be made by a vote of the CPSC Commission.

Phthalates are a class of chemicals used to soften plastics and are commonly found in children’s toys. Three phthalates, di-(2-ethylhexly) phthalate (DEHP), dibutyl phthalate (DBP), and benzyl butyl phthalate (BBP), were banned from use in toys and other children’s products in concentrations above 0.1 percent in 2009 under the Consumer Product Safety Improvement Act, and three more were banned on an interim basis based on the same concentration limit the same day. The 2009 interim banned substances include diisononyl phthalate (DINP), diisodecyl phthalate (DIDP), and di-n-octyl phthalate (DnOP).

The CPSC published a proposed rule in December 2014 and was supposed to issue a final order within 180 days to continue an interim ban on the five phthalates, DIBP, DnPP, DnHP, DCHP, and DINP, within children’s toys, however, the 180-day period stretched to 950 days as of last week.

The NRDC, along with the Environmental Justice Health Alliance for Chemical Policy Reform and the Breast Cancer Fund, filed a complaint in December of 2016 seeking injunctive and declaratory relief to force the CPSC to regulate the five phthalates in children’s products.

A consent decree is expected to be finalized within the month.

The case is Natural Resources Defense Council et al. v. U.S. Consumer Product Safety Commission, case number 1:16-cv-09401, filed in the U.S. District Court for the Southern District of New York.

Court to Allow California to List Glyphosate as Possible Cancer Threat under Prop. 65

In September 2015 the California Environmental Protection Agency’s Office of Environmental Health Hazard Assessment (OEHHA) announced plans to list the pesticide glyphosate as a possible cancer threat under Proposition 65. OEHHA made the decision to list glyphosate following the International Agency for Research on Cancer March 2015 finding that glyphosate is “probably carcinogenic to humans.” Monsanto sued OEHAA in January 2016, in an effort to block the listing. Global sales of glyphosate were about $7.8 billion in 2014, as a carcinogen under Proposition 65. It is the main ingredient in Monsanto’s Roundup.

A tentative ruling by California Superior Court Judge Kristi Culver Kapetan states that the court intends to dismiss Monsanto’s lawsuit. In the lawsuit, Monsanto claimed that the listing was unconstitutional because OEHHA delegated law-making authority “to an unelected and non-transparent foreign body that is not under the oversight or control of any federal or state government entity,” and because the labor code process violated the due process clauses of the California and U.S. constitutions. In its motion to dismiss the lawsuit, California argued that IARC’s scientific determinations are “the gold standard in carcinogen identification.” The court found that Monsanto’s petition failed to state facts sufficient to constitute a cause of action.

Judge Kapetan will be issuing a formal decision soon.

Implementing the 2016 TSCA Amendments – Progress & Prognosis

Verdant Attorney Irene Hantman will speak on Wednesday, February 22 at a panel discussion among experts on implementing the Frank R. Lautenberg Chemical Safety for the 21st Century Act, which amends the Toxic Substances Control Act (TSCA). The program includes a panel of legal experts, current and former EPA officials, and representatives from environmental NGOs and trade groups. The panel will discuss topics including:

  • The potential effects of the change in Administration
  • Congress’ oversight role
  • Regulatory actions already taken by EPA
  • Regulatory actions required during 2017

The program includes an informal brown bag lunch for in-person participants in Washington, D.C., as well as dial-in participation. If attending in person, please RSVP to Gina Dean at gina.dean@apks.com; teleconference information is forthcoming. This event is sponsored by the Pesticide, Chemical Regulation, and Right-to-Know Committee of the ABA Section of Environment, Energy, and Resources (SEER), with co-sponsorship by the Environmental Law Institute and SEER’s Special Committee on Congressional Relations, and hosted by Arnold & Porter Kaye Scholer LLP.

Please see the announcement [PDF] for more details.

GENERAL INFORMATION:

Location: Arnold & Porter LLP, 601 Massachusetts Avenue, NW, Washington, DC 20001

Arrival Time: 11:45 am; plan to arrive in advance to check in and pass through security; the dialogue will begin promptly at noon and will conclude at 2:00 pm.

Moderator: Larry Culleen, Partner, Arnold & Porter Kaye Scholer LLP

Panelists:

  • Jim Jones, Former Assistant Administrator, US EPA [invited]
  • Wendy Cleland-Hamnet, Office Director, Office of Pollution Prevention & Toxics, US EPA
  • Mike Walls, VP Regulatory & Technical Affairs, American Chemistry Council [invited]
  • Richard Denison, Lead Scientist, Environmental Defense Fund
  • Ernie Rosenberg, President & CEO, American Cleaning Institute
  • Lynn Bergenson, Managing Partner, Bergeson & Campbell
  • Martha Marrapese, Partner, Keller & Heckman
  • Irene Hantman; Verdant Law