The attorneys, scientists, policy experts, and regulatory advisors of Bergeson & Campbell, P.C. (B&C®), The Acta Group (Acta®), and B&C® Consortia Management, L.L.C. (BCCM) endeavor year-round to keep you informed on key developments as they happen, and prepared for looming changes and deadlines, to help you maintain compliance and competitive advantage as you market your products throughout the world. As the new year begins, we offer you this look back at the top stories of 2016 (as measured by clicks, reads, and shares by readers of our blogs and e-mails), a year that was full of surprises and dramatic shifts -- many of which will play out well into the new year.
June 22, 2016
TSCA Reform: An Analysis of Key Provisions and Fundamental Shifts in the Amended TSCA
September 22, 2016
Proposition 65: OEHHA Adopts Revisions to Its Proposition 65 Warning Regulations
August 8, 2016
TSCA Reform: Proposed Changes to SNUR Procedures Would, Perhaps Inadvertently, Result in Disclosure of CBI to Third Parties/Possible Competitors
June 29, 2016
TSCA Reform: EPA Publishes First Year Implementation Plan
April 8, 2015
K-REACH: List of Priority Existing Substances Submitted for Consultation
December 20, 2016
TSCA: EPA Amends Procedures for TSCA Section 6 Rulemaking
January 6, 2016
EPA Releases Preliminary Risk Assessment for Neonicotinoid Insecticide Imidacloprid
January 8, 2016
EPA Sued Over Guidance Classifying Seeds Coated with Neonicotinoid Insecticides as Treated Articles Exempt from Registration under FIFRA
February 10, 2016
Bayer Announces That It Will Not Submit Voluntary Cancellation Requests for Flubendiamide
October 19, 2016
Brazil Delays Promulgation of Final Industrial Chemicals Regulation
October 6, 2015
EPA Announces Revisions to Its Worker Protection Standard
September 28, 2016
EPA Announces Regulatory Determinations on MCANs and PMNs
January 13, 2016
EPA Denies SDA Nomenclature Petition, But Options for Adding Biobased Sources Remain Open
December 1, 2016
Brexit -- An Overview of Transformative Developments and Their Potential Impact on European Chemical Laws
Top Articles Authored by B&C:
Kathleen M. Roberts, Richard E. Engler, Ph.D., Charles M. Auer, Lynn L. Bergeson, "An Analysis of Section 8 of the New Toxic Substances Control Act," BNA Daily Environment Report, August 9, 2016.
Lynn L. Bergeson, Charles M. Auer, "An Analysis of TSCA Reform Provisions Pertinent to Industrial Biotechnology Stakeholders," Industrial Biotechnology, Volume 12, Issue 4, August 2016.
Charles M. Auer, "Old TSCA, New TSCA, and Chemical Testing," BNA Daily Environment Report, August 16, 2016.
L. Bergeson, B. Auerbach, L. Campbell, T. Backstrom, S. Dolan, J. Vergnes, R. Engler, J. Bultena, K. Baron, C. Auer, "The DNA of the U.S. Regulatory System: Are We Getting It Right for Synthetic Biology?," Woodrow Wilson International Center for Scholars Synthetic Biology Project Report, October 15, 2015.
Coming first quarter 2017 from ABA Books:
Lynn L. Bergeson, Charles M. Auer, New TSCA: A Guide to the Lautenberg Chemical Safety Act and Its Implementation, American Bar Association (2017).
By Lynn L. Bergeson, Charlie M. Auer, and Margaret R. Graham
On October 21, 2016, the U.S. Environmental Protection Agency (EPA) reopened the comment period on a proposed rule revising regulations governing significant new uses (SNU) of chemical substances under the Toxic Substances Control Act (TSCA), per a request from a commenter. EPA states in its Federal Register notice that this request was “reasonable and is therefore reopening the comment period … [for] all interested persons.” The proposed rule would amend the TSCA SNU regulations to align them with revisions to the Occupational Safety and Health Administration’s (OSHA) Hazard Communications Standard (HCS), as occasioned by OSHA's March 2012 final rule modifying the HCS to conform to the United Nations' (U.N.) Globally Harmonized System of Classification and Labelling of Chemicals (GHS), changes to OSHA’s Respiratory Protection Standard, and the National Institute for Occupational Safety and Health (NIOSH) respirator certification requirements pertaining to respiratory protection of workers from exposure to chemicals. The proposed rule would also amend regulations for SNU rules (SNUR) previously proposed and issued and make a “minor” change to reporting requirements for premanufacture notices (PMN) and other TSCA Section 5 notices.
The brief notice reopening the comment period does little to reinforce the magnitude and consequences of these proposed changes. Our memorandum TSCA: Proposed Revisions to Significant New Use Rules Reflect Current Occupational Safety and Health Standards provides a detailed account of the significant and complex issues that these changes raise, briefly reiterated here:
- The challenges in aligning labeling, as well as legal and regulatory ambiguities. EPA has devoted considerable effort to clarifying the application of HCS/GHS requirements to Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) but unresolved issues still remain. The implementation of these revisions will most likely present similar challenges.
- EPA’s use of the hierarchy of controls (HOC) approach in the significant new use provisions, even though Congress did not include this approach in new TSCA. The wisdom of the inclusion of the HOC approach, even though we recognize and appreciate the importance of HOC as an element in a system to manage or eliminate occupational risks, is questionable and inconsistent.
- Whether or not EPA's review considered the possibility that new TSCA may materially impact the content of the proposal. There are signs, such as EPA’s inclusion of old TSCA citations, that point to them not having done this review, and there are no reassurances from EPA that new TSCA’s potential impacts were considered.
Our memorandum TSCA Reform: Proposed Changes to SNUR Procedures Would, Perhaps Inadvertently, Result in Disclosure of CBI to Third Parties/Possible Competitors also brings to light another important legal issue, concerning interesting anomalies that appear in the proposal's discussion of bona fide requests and the disclosure of information potentially considered confidential. EPA proposes to modify the procedures for determining if a specific substance or chemical use is subject to a SNUR when the substance, production volume, or use is claimed as confidential business information (CBI). The source of EPA’s authority to disclose CBI in the ways described in the proposed rule is unclear, as neither old nor new TSCA specifies them, such as the statutory basis and rationale for informing a bona fide intent notice (BFN) submitter of confidential use or production volume conditions. Also, EPA does not justify why disclosure to the BFN submitter is necessary. The current proposed SNUR provides for neither equal disclosure nor equal confidentiality as a result of BFN submission.
Bergeson & Campbell, P.C. (B&C®) Managing Partner Lynn L. Bergeson and Senior Policy and Regulatory Advisor Charles M. Auer have recently published two articles on important issues as related to the amended Toxic Substances Control Act (TSCA):
The concept of “conditions of use” plays an important role in TSCA as amended by the Frank R. Lautenberg Chemical Safety for the 21st Century Act. Conditions of use is a centralizing concept under which the U.S. Environmental Protection Agency (EPA) determines how a chemical is made, processed, used, and disposed. The term is defined in TSCA Section 3 and also appears one or more times in the following Sections: 5, 6, 9, 14, 18, 21, and 26. The term is not used in Sections 4 and 8. B&C’s BNA article explores the use and application of conditions of use under Sections 5 and 6 and provides insights into the implications of what may be its unusual use in Section 5 in comparison to Section 6.
Among its other requirements and authorities, Section 5 of new TSCA generally requires that a company timely submit to EPA a notice of its intent to manufacture or process a new chemical or significant new use (NC/SNU). EPA is then required to conduct a review of the Section 5(a)(1) notice and make a determination on the NC/SNU and take required additional actions. Questions have been raised as to whether the review period is fixed and requires that EPA determinations and actions be completed within that period, or if the statute can be read to permit a more flexible review period along the lines of how it was interpreted and applied in old TSCA with the use of voluntary suspensions. Charles M. Auer and Lynn L. Bergeson’s September ABA article analyzes that question.
Other B&C articles on amended TSCA and other regulatory issues of interest are available on our website.
On July 28, 2016, the U.S. Environmental Protection Agency (EPA) proposed to update the Toxic Substances Control Act (TSCA) Significant New Use Rule (SNUR) procedures. 81 Fed. Reg. 49598. As discussed in our previous memorandum on this proposed rule, Proposed Revisions to Significant New Use Rules Reflect Current Occupational Safety and Health Standards, while some of the proposed changes are not consequential, other changes, such as those related to workplace protections, are more clearly consequential. An issue that was noted but not discussed in detail in our previous memorandum is EPA's proposal to modify the procedures for determining if a specific substance or chemical use is subject to a SNUR when the substance, production volume, or use is claimed as confidential business information (CBI). Specifically, EPA has proposed changes to 40 C.F.R. § 721.11 to address these procedures. Below, we review the current procedures and then address how the proposed language would change those procedures -- changes of which stakeholders should be aware.
To put the changes into context, we first consider the current regulations relating to establishing a bona fide intent to manufacture (bona fide intent) a substance that has confidential identity or confidential conditions in a SNUR. Under the current procedure, determining if a specific substance is listed on the confidential portion of the TSCA Inventory (Inventory) and if the substance is subject to a SNUR requires the submission of a bona fide intent notice (BFN), according to the procedures codified at 40 C.F.R. § 721.11(b). If EPA determines that the submitter has established a bona fide intent, EPA will inform the submitter that the substance is listed on the Inventory and provide "which section in subpart E of this part [40 C.F.R. § 721] applies." This provision would not necessarily reveal any CBI information regarding use or production volume restrictions that are conditions of the SNUR, only the specific 40 C.F.R. § 721 citation.
Whether the identity of a substance is confidential or not, the substance may have SNUR restrictions applied to it that are considered CBI. In particular, production volume and/or specific use(s) may be considered CBI and be part of a SNUR imposed on the substance. The procedures for determining the confidential SNUR restrictions are similar to the procedures to determine if a substance is listed on the confidential portion of the Inventory. It requires submitting a BFN to EPA. In the past, when EPA needed to refer to the procedures for submitting a BFN to determine the confidential SNUR conditions, it referred to the procedures codified at 40 C.F.R. § 721.1725(b)(1). This is in contrast to the BFN procedures for determining if a specific substance is subject to a SNUR listed in 40 C.F.R. § 721.11(b).
To put these changes in context, let us first examine the current procedures for EPA's response to a BFN submitted to determine the CBI provisions of a SNUR. 40 C.F.R. § 721.1725(b)(1)(iv) states:
If EPA determines that the person has a bona fide intent to manufacture, import, or process the chemical substance, EPA will tell the person whether the use for which the person intends to manufacture, import, or process the substance is a significant new use [(SNU)] under paragraph (a)(2)(i) of this section. If EPA tells the person that the intended use is not a significant new use under paragraph (a)(2)(i) of this section, EPA will tell the person what activities would constitute a significant new use under paragraph (a)(2)(ii) of this section.
This means that upon making its determination that a submitter has demonstrated a bona fide intent, EPA either:
- Tells the BFN submitter that the use specified in the BFN is a SNU, in which case the submitter must prepare and submit a Significant New Use Notice (SNUN) at least 90 days prior to manufacturing the substance for the particular use of the substance; or
- Tells the BFN submitter that the use specified in the BFN is not a SNU, in which case EPA tells the submitter what activities would constitute a SNU for the substance.
Note that in the first scenario, where a SNUN is required, EPA does not inform the submitter of the existing confidential SNUR conditions. EPA subsequently makes a determination based on the information in the SNUN when submitted, and informs the SNUN submitter of any restrictions imposed to manage risks associated with the use described in the SNUN. The new restrictions could either be unique to the conditions of the SNUN or could result in a modification of the previously established CBI SNUR restrictions. Also, EPA could amend the confidential portion of the SNUR to include any new permissible activities as a result of the SNUN (e.g., add another CBI use) without informing either manufacturer of the other's confidential SNUR conditions.
In the second scenario, where EPA determines that the BFN submitter's use is not a SNU, EPA informs the BFN submitter of any restrictions associated with that use that might further restrict the BFN submitter or its customers (e.g., the BFN submitter's use is permitted, but that the production volume is capped by the SNUR). As a matter of practice, EPA informs the original submitter that another submitter has demonstrated a bona fide intent, but this practice is not codified in the C.F.R. Furthermore, the original submitter is not informed of the BFN submitter's intent, only that the BFN submitter's use was not a SNU, whereas the BFN submitter knows the heretofore confidential specific use and production volume ceiling (if any). These two outcomes are not aligned. The first scenario is more protective of both entities' CBI. The second scenario provides the BFN submitter some visibility of the original submitter's CBI, but not the reverse.
For example: Manufacturer 1 submits a premanufacture notice for a non-confidential chemical substance to be used as an intermediate to manufacture a pesticide and claims the use as confidential (with a generic use of "intermediate"). EPA makes a determination that the use specified in the PMN does not present an unreasonable risk to health or the environment, but other uses may present issues, so EPA imposes a SNUR invoking 40 C.F.R. § 721.80(j) limiting its use to the use listed in the PMN (intermediate to manufacture a pesticide). Manufacturer 1 then commences commercially manufacturing the substance and files a Notice of Commencement (NOC), placing the substance on the public portion of the Inventory. Some time later, Manufacturer 2 seeks to use the same substance as an intermediate to manufacture an anti-oxidant lubrication additive. Manufacturer 2 submits a BFN and EPA informs Manufacturer 2 that its use is a SNU. Manufacturer 2 then submits a SNUN for its use, also claiming the specific use as confidential and listing "intermediate" as the generic use. EPA evaluates the SNUN and determines that this particular use is not likely to present unreasonable risk to health or the environment, but other uses may present issues, so EPA adds the new use to the confidential uses permitted for the substance, but leaves the other SNUR provisions in place and neither manufacturer knows the specific use of the other.
We note that manufacturers must communicate SNUR restrictions to their customers. 40 C.F.R. § 721.5 requires that to avoid submitting a SNUN, each manufacturer must provide the SNUR conditions to its customer(s). 40 C.F.R. § 721.5(a)(2) requires that "[a] person who intends to manufacture, import, or process for commercial purposes a chemical substance [with a SNUR], and intends to distribute the substance in commerce" must submit a SNUN. Most manufacturers avoid this SNUN requirement by taking advantage of the provisions of 40 C.F.R. § 721.5(a)(2)(i) that state that a SNUN is not required if the manufacturer can document:
That the person [manufacturer] has notified the recipient [customer], in writing, of the specific section in subpart E of this part which identifies the substance and its designated significant new uses.
In the example above, each manufacturer notifies its own customers of the appropriate C.F.R. citation and SNUR restrictions (Manufacturer 1 informs its customer that the use is limited to use as an intermediate for a pesticide; Manufacturer 2 informs its customer that the use is limited to use as an intermediate for an antioxidant). The customers of each manufacturer remain in compliance with the SNUR and 40 C.F.R. § 721.5, assuming each customer restricts its use based on the information provided by the separate manufacturers. In this scenario, all four parties (both manufacturers and both customers) can be in compliance without EPA disclosing the confidential use of one manufacturer to the other.
EPA has proposed incorporating the BFN procedures for determining whether an activity is a SNU under the confidential provisions of a SNUR into 40 C.F.R. § 721.11(a) (the proposed key changes are emphasized):
A person who intends to manufacture or process a chemical substance which is subject to a significant new use rule in subpart E of this part may ask EPA whether the substance or a proposed use is subject to the requirements of this part if that substance is described by a generic chemical name or if the significant new use is confidential and therefore not described specifically in the rule. EPA will answer such an inquiry only if EPA determines that the person has a bona fide intent to manufacture or process the chemical substance for commercial purposes.
This change is innocuous. It simply incorporates the two BFN procedures into a single paragraph. EPA's proposal on procedures for its response to such a BFN, proposed to be codified at 40 C.F.R. § 721.11(e) alters procedures for how EPA responds (again, proposed key changes emphasized):
If the manufacturer or processor has shown a bona fide intent to manufacture or process the substance and has provided sufficient unambiguous chemical identity information to enable EPA to make a conclusive determination as to the identity of the substance, EPA will inform the manufacturer or processor [the BFN submitter] whether the chemical substance is subject to this part and, if so, which section in subpart E of this part applies, and identify any confidential significant new use designations.
Under the proposed rule, once a submitter has established a bona fide intent, EPA will disclose to the BFN submitter any confidential significant new use designations, including specific use and production volume restrictions, whether or not those restrictions are relevant to or would limit the BFN submitter's commercial activity as proposed in the BFN. As proposed by EPA, this disclosure would be made to the BFN submitter without regard for the existing CBI claims on the information, and without informing the original entity holding the CBI claim before or after making this disclosure.
Importantly, this change means that EPA is switching from a presumption of protecting CBI in the SNUR to actively informing later submitters of information proprietary to the original submitter. While 40 C.F.R. § 721.11(f) states that informing later submitters of SNUR restrictions "will not be considered public disclosure of [CBI] under Section 14," it is an unavoidable fact that EPA's proposed approach involves disclosure of CBI to an additional party, one that could be a competitor to the original submitter (both are, after all, manufacturing the same substance), a fact pattern that is very likely to be of considerable concern to the original submitter.
We do not read provisions in either old or new TSCA to authorize EPA to disclose CBI in the way that is proposed in this notice. The CBI SNUR requirements do not fall into any of the information types discussed under Section 14(b) of new TSCA that concerns information not protected from disclosure. The BFN submitter cannot be considered to have official duties or needs related to those discussed at Section 14(d) of new TSCA, the provision that allows CBI disclosure under certain circumstances. The BFN submitter only needs to know if the proposed use is a SNU or not. If EPA informs the BFN submitter that the proposed use is not a SNU, the BFN submitter is effectively bound to the use terms laid out in the BFN and would need to submit a new BFN if other uses or changes in the initially proposed use are contemplated.
Based on the foregoing, with the proposed language, the second submitter is unavoidably privy to the CBI claimed by the first submitter, but there is no provision in the C.F.R to inform the first submitter of the conditions sought by the second submitter. This is in contrast to the provisions in 40 C.F.R. § 720.25(b)(6) in which the original submitter is notified if and when a second entity has demonstrated a bona fide intent that is listed on the CBI portion of the Inventory. Both the original submitter and the BFN submitter are informed that another entity is manufacturing the substance for a TSCA purpose.
EPA must provide the statutory basis and rationale for informing a BFN submitter of confidential use or production volume conditions. If EPA can provide the statutory basis for such disclosure, EPA must also explain why it must disclose such information to the BFN submitter. If EPA can somehow justify disclosing the CBI SNUR conditions, it should codify its obligation to notify the original CBI submitter that such disclosure has occurred. The current proposed SNUR provides for neither equal disclosure nor equal confidentiality as a result of BFN submission.
TSCA stakeholders should carefully consider commenting on the changes to 40 C.F.R. § 721.11 to be sure that EPA is acting within its statutory authority, justifying why disclosure is necessary, and providing for notification of the original CBI holder. While the consequences of these proposed provisions may be inadvertent, the proposed rule either needs to be withdrawn and re-proposed to reflect the law, or rationalized in a way that our careful reading of TSCA does not allow.
By Lynn L. Bergeson and Margaret R. Graham
The U.S. Environmental Protection Agency (EPA) proposed on July 28, 2016, revisions to the regulations governing significant new uses of chemical substances under the Toxic Substances Control Act (TSCA) with revisions to the Occupational Safety and Health Administration’s (OSHA) Hazard Communications Standard (HCS) occasioned by OSHA’s March 2012 final rule modifying the HCS to conform to the United Nations’ (U.N.) Globally Harmonized System of Classification and Labelling of Chemicals (GHS), changes to OSHA’s Respiratory Protection Standard, and the National Institute for Occupational Safety and Health (NIOSH) respirator certification requirements pertaining to respiratory protection of workers from exposure to chemicals. EPA states that it is also proposing changes to regulations based on issues that it identified, as well as issues raised by public commenters, for significant new use rules (SNUR) previously proposed and issued under these regulations. Additionally, EPA claims to propose a “minor” change to reporting requirements for premanufacture notices (PMN) and other TSCA Section 5 notices. EPA states that it expects the changes “to have minimal impacts on the costs and burdens of complying, while updating the significant new use reporting requirements to assist in addressing any potential effects to human health and the environment.” Comments are due September 26, 2016.
The revisions include:
- Proposed Changes to 40 C.F.R. Section 721.63, Protection in the Workplace;
- Proposed Changes to 40 C.F.R. Section 721.72, Hazard Communication Program;
- Clarification of the Use of 40 C.F.R. Section 721.80, Industrial Commercial and Consumer Activities;
- Proposed Changes to 40 C.F.R. Section 721.91, Computation of Estimated Surface Water Concentrations: Instructions;
- Proposed Changes to 40 C.F.R. Section 721.11, Determining Whether a Chemical Substance or a Specific Use Is Subject to This Part When the Chemical Substance Identity or Significant New Use Is Confidential;
- Proposed Changes for Submission of SDS(s) with PMNs, SNUNs, Low Volume Exemptions (LVE), Low Release and Exposure Exemptions (LoREX), and Test Marketing Exemption (TME) Applications; and
- Fixing Typographical Errors and Other Non-Substantive Changes.
Although the notice downplays them, the proposal raises significant and complex issues. There may well be good reasons for several of the proposed changes. The minimal discussion provided in the notice and the lack of adequate public debate having occurred prior to its issuance raise troubling questions about the legal basis for, scope of, and complexity of the proposed changes, some of which may apply retroactively. The confusion the proposal can be expected to cause could have been avoided had adequate discussion preceded its publication, or at the least EPA could have raised these issues in the proposed rule’s preamble to focus stakeholders’ attention appropriately.
More information is available in our memorandum TSCA: Proposed Revisions to Significant New Use Rules Reflect Current Occupational Safety and Health Standards.
By Lynn L. Bergeson
On July 26, 2016, the U.S. Environmental Protection Agency (EPA) issued a notice in the Federal Register soliciting a second round of comments on the burdens and value of information it periodically collects addressing significant new use rules (SNUR) for existing chemicals. Specifically, EPA submitted a request to renew the approval of an existing information collection request (ICR), Toxic Substances Control Act (TSCA) Section 5(a)(2) SNURs for Existing Chemicals, to the Office of Management and Budget (OMB). This notice provides chemical manufacturers and other interested parties a second opportunity to comment on certain questions, specifically: whether the agency accurately estimated the burden of responding to SNURs that it issues for chemicals in commerce; whether the agency could minimize the burden; and whether the information it collects is necessary.
The first ICR was issued on September 2, 2015, and comments were due November 2, 2015. Only two comments were filed in response to the initial ICR, by the American Chemistry Council (ACC) and the Society of Chemical Manufacturers & Affiliates (SOCMA), two trade associations. ACC and SOCMA stated in their comments that EPA underestimated the burdens its SNURs impose on chemical manufacturers and their customers.
This renewed ICR states that EPA estimated that six companies would be affected by its new use rules for existing chemicals, creating an estimated total burden of 1,025 hours per year and a cost of $100,595.
Comments are due August 25, 2016.
SNURs are deeply unpopular to some in the chemical community and welcomed outcomes of the premanufacture notice (PMN) or significant new use notification (SNUN) process to others. Most would agree that the cost of compliance with a SNUR can be difficult to estimate with any degree of precision. Some of us are also of the view that TSCA, as recently amended, may result in many more SNURs given the new “determination” requirements under TSCA Section 5(a). The comment period opened by today’s Federal Register notice provides an excellent opportunity to provide comment to EPA and thus help to ensure that EPA has an accurate and current basis upon which to estimate the cost.