The U.S. Environmental Protection Agency (EPA) announced on September 3, 2021, that it intends to initiate a new rulemaking and anticipates proposing new rules for five persistent, bioaccumulative, and toxic (PBT) chemicals that are the subject of final risk management rules under the Toxic Substances Control Act (TSCA). Additionally, and importantly, EPA is extending the compliance dates for the prohibitions on processing and distribution and the associated recordkeeping requirements of one of these PBT chemicals, phenol, isopropylated phosphate (3:1) (PIP (3:1)). The action is imperative as the current No Action Assurance (NAA) was set to lapse tomorrow at 11:59 p.m.

New Rulemaking on PBT Chemicals

On January 6, 2021, EPA issued final rules under TSCA Section 6(h) for five PBTs -- 2,4,6-tris(tert-butyl)phenol (2,4,6-TTBP) (86 Fed. Reg. 866); decabromodiphenyl ether (decaBDE) (86 Fed. Reg. 880); hexachlorobutadiene (HCBD) (86 Fed. Reg. 922); pentachlorothiophenol (PCTP) (86 Fed. Reg. 911); and PIP (3:1) (86 Fed. Reg. 894). The final rules limit or prohibit the manufacture (including import), processing, and/or distribution in commerce for the following:

• DecaBDE: A flame retardant in plastic enclosures for televisions, computers, audio and video equipment, textiles and upholstered articles, wire and cables for communication and electronic equipment, and other applications;
• PIP (3:1): A plasticizer, a flame retardant, an anti-wear additive, or an anti-compressibility additive in hydraulic fluid, lubricating oils, lubricants and greases, various industrial coatings, adhesives, sealants, and plastic articles;
• 2,4,6-TTBP: An intermediate/reactant in processing, and it is incorporated into formulations destined for fuel and fuel-related additives;
• HCBD: A chemical used as a halogenated aliphatic hydrocarbon that is produced as a byproduct during the manufacture of chlorinated hydrocarbons; and
• PCTP: A chemical used to make rubber more pliable in industrial uses.

EPA announced on March 8, 2021, that “in accordance with Biden-Harris Administration executive orders and directives,” it is asking for additional public input on these rules. EPA opened a 60-day comment period for the public to provide new input on:

• Whether the rules sufficiently reduce exposure to these chemicals, including exposures to potentially exposed or susceptible subpopulations and the environment;
• Newly raised compliance issues associated with the final PIP (3:1) rule, including the compliance dates for certain regulated articles; and
• Whether to consider additional or alternative measures or approaches.

In its September 3, 2021, announcement, EPA states that after further review, it “is considering revising all five of the final rules to further reduce exposures, promote environmental justice, and better protect human health and the environment.” EPA plans to propose a new separate rulemaking on all five PBT chemicals in spring 2023. The current provisions of the January 2021 rules remain in effect while EPA works on this new rulemaking effort, with the exception of PIP (3:1) as described below.

Extension of PIP (3:1) Compliance Dates

EPA states that it is extending certain compliance dates for PIP (3:1) to March 8, 2022, “to address the hardships inadvertently created by the original applicable compliance dates in the January 2021 final rule to ensure that supply chains are not disrupted for key consumer and commercial goods.” According to EPA, it will also soon issue a notice of proposed rulemaking that, if issued in final, would further extend the compliance dates.

Following the release of the final PIP (3:1) rule, stakeholders informed EPA that the prohibition on processing and distribution of PIP (3:1) could impact articles used in a wide variety of electronics, from cell phones, to robotics used to manufacture semiconductors, to equipment used to move COVID-19 vaccines and keep them at the appropriate temperature. EPA states that stakeholders “note that the complexity of international supply chains makes locating the presence of, and finding alternatives to, PIP (3:1) in components challenging.” Stakeholders asserted that an extension to the compliance deadline was necessary to avoid significant disruption to the supply chain for a wide variety of articles. In response to this information, EPA issued a temporary 180-day NAA indicating that it would exercise its enforcement discretion regarding the prohibitions on processing and distribution of PIP (3:1) for use in articles, and the articles to which PIP (3:1) has been added.

As reported above, EPA also requested additional comment on the final PIP (3:1) rule. According to EPA’s September 3, 2021, announcement, “industry commenters indicated the need for varying time frames to remove PIP (3:1) from their supply chains, and many did not provide sufficiently specific information about their operations to support their assertions.”

To ensure that supply chains continue uninterrupted, EPA has signed a final rule providing a short-term extension of the specified compliance dates for PIP (3:1) articles until March 8, 2022. This final rule will be effective upon publication in the Federal Register. According to EPA’s September 3, 2021, announcement, EPA will soon issue a notice of proposed rulemaking seeking comment on a further extension of the compliance dates for PIP (3:1) articles and the associated recordkeeping to align with certain comments received and the expected timing for the new rulemaking on PBT chemicals. EPA will accept public comments in Docket EPA-HQ-OPPT-2021-0598 on www.regulations.gov for 60 days from publication of the proposed rule in the Federal Register. EPA intends to issue a final rulemaking that would further extend certain compliance dates before March 8, 2022.

As part of the separate rulemaking on all five PBT chemicals planned for 2023, EPA states that it intends to reevaluate the current rules for PIP (3:1) and the other PBTs, as well as provide a description of the specific kinds of information it will require to support any additional extensions to the compliance dates. According to the announcement, EPA “will expect industry commenters to provide documentation of the specific uses of PIP (3:1) in articles throughout their supply chains, documentation of concrete steps taken to identify, test, and qualify substitutes for those uses, documentation of specific certifications that would require updating and an estimate of the time that would be required. Without this more specific information from suppliers, EPA will be unlikely to extend the compliance dates again.”

Commentary

EPA’s announcement of the extension of the PIP (3:1) compliance dates to March 8, 2022, is welcome relief to importers, distributors, and retailers of electric and electronic devices, although we imagine that most will be disappointed by the seemingly short timeframe. As the many comments submitted in May in response to EPA’s request for additional comment on the final rule demonstrate, most importers and distributors of electric and electronic articles could not determine with confidence whether PIP (3:1) was in any part of any article, whether it could be replaced if it was, and that it would take years to survey the complex global supply chains that underlie most complex articles. After reviewing these comments, EPA’s view is that “many [commenters] did not provide sufficiently specific information about their operations to support their assertions.” As a result, EPA will again request comment and states that it will “provide a description of the specific kinds of information the Agency will require to support any additional extensions to the compliance dates.”

Perhaps as a legal prudential matter, EPA is reluctant to grant blanket extensions, and instead is requiring “industry commenters to provide documentation of the specific uses of PIP (3:1) in articles throughout their supply chains, documentation of concrete steps taken to identify, test, and qualify substitutes for those uses, documentation of specific certifications that would require updating and an estimate of the time that would be required. Without this more specific information from suppliers, EPA will be unlikely to extend the compliance dates again.” This approach may be more defensible to a blanket extension of some period of years, especially if commenters neglected to provide sufficient granularity to support an additional extension, as EPA suggests. EPA has not provided additional detail about what information will be sufficient in EPA’s view to document the challenges of identifying PIP (3:1) in supply chains and, if necessary, identifying and qualifying alternatives.

While we understand EPA’s need for additional information, we question whether EPA is fully aware of the challenges of obtaining specificity on every part in a device as complex as a computer in six months, especially when many of those suppliers are outside of TSCA jurisdiction and until early 2021 were not in the habit of tracking PIP (3:1) as a prohibited substance. Imagine trying to go to an electronics supply store to buy a USB charging cable for your mobile phone and you ask the store if there is any PIP (3:1) in the cable. The store does not know, so the store has to ask its U.S. supplier, who has to ask the importer, who has to ask the foreign manufacturer, who (because it only assembled the final product) has to ask its various suppliers, including the supplier of the outer coating, the inner fiber, and the connectors at each end. Now imagine having to do that for every plastic part or subpart of every electric or electronic product in that store. This is the effort that will be required to identify whether PIP (3:1) is present. If it is found, the part manufacturer will have to identify and qualify an alternative and each part supplier and every downstream supply chain partner will have to likewise qualify the part containing the alternative, including obtaining re-review by certifying agencies, such as Underwriter Laboratories (UL).

We also question whether six months is sufficient for stakeholders to gather even more detailed information into comments. Similarly, we question whether EPA will have sufficient time to review those comments to inform a more detailed view of the complexity of the challenge faced by importers and their customers in the United States, including wholesalers and retailers. It would not surprise us if, in six months, EPA were again issuing a short-term extension of the compliance date.

We strongly urge manufacturers and importers of electric and electronic final products to document efforts taken to-date and immediately to gather more specific facts related to how challenging it will be to survey every supplier of every part. These measures will best prepare stakeholders so that when EPA provides its guidance on commenting, commenters will be prepared to provide comments during what we expect will be a very short comment period.

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