Landmark Reform of Federal Chemicals Law Will Significantly Impact Chemical Manufacturers and Users

by Bradley Arant Boult Cummings LLP
Contact

Bradley Arant Boult Cummings LLP

On June 22, 2016, President Obama signed into law the Frank R. Lautenberg Chemical Safety Act for the 21st Century Act (“Lautenberg Act”), a sweeping and historic overhaul of our nation’s primary chemical management law, the Toxic Substances Control Act (“TSCA”). The Lautenberg Act grants the United States Environmental Protection Agency (“EPA”) new powers and mandates that will significantly impact corporate regulatory compliance, supply chains, risk management, and sustainability programs. With EPA’s implementation of the Lautenberg Act already underway, companies that manufacture, process, and use chemicals – including those that incorporate chemicals into their finished products – are working feverishly to assess the near- and long-term impacts on their businesses.

A new day has dawned for manufacturers, processors, users, and other companies in the chemical supply chain. Defying the gridlock in Washington and the partisanship frequently associated with environmental issues, the Lautenberg Act became the first major piece of environmental legislation to become law since the Food Quality Protection Act of 1996. It passed the United States Senate and the House of Representatives with overwhelming bipartisan majorities, and it garnered the support of a broad range of stakeholders that included industry groups (e.g., the American Chemistry Council), environmental groups (e.g., the Environmental Defense Fund), unions, and many more.

With the new law on the books, all eyes are now turned to EPA, the federal agency tasked with implementing the Lautenberg Act. And the task is formidable. For example, EPA must evaluate the safety of a vast number of chemicals and their uses, assess company claims for confidentiality, and meet a number of additional obligations – many of which must be completed within Congressionally mandated deadlines (see sidebar for a timeline of selected regulatory milestones). Not wasting any time, EPA has already begun its work as evidenced in its June 29, 2016, First Year Implementation Plan, available at https://www.epa.gov/sites/production/files/2016-06/documents/tsca21_implementation_plan_6_28.pdf . Accordingly, companies that manufacture, import, export, use, or sell chemicals, or products containing chemicals, would be well-served in understanding how the new chemicals management regime impacts their businesses and participating in EPA’s implementation of the new law.

Expanded Authority to Assess Chemical Safety

A central component of the Lautenberg Act is a requirement that EPA review the safety of each and every regulated chemical substance. To date, the safety of many thousands of chemical substances in commerce have not been evaluated by EPA due to a “grandfathering” provision in the original TSCA. Going forward, EPA will conduct risk-based screening assessments of these chemical substances and, in doing so, prioritize its reviews such that chemicals presenting the greatest risk will be reviewed first, followed by lower-risk chemicals. A “high-priority” designation of a chemical substance triggers an obligation to conduct the necessary risk assessment within three years, with the possibility of a six-month extension. If, at the end of its assessment, EPA determines that a chemical substance presents an “unreasonable risk of injury to health or the environment,” then EPA must regulate the chemical or chemical use. Significantly, in making this determination, the Lautenberg Act alters the original TSCA risk standard by adding a requirement that EPA consider potential impacts on sensitive populations such as pregnant women and children, and it prohibits EPA from considering “non-risk factors” (e.g., costs). Conventional wisdom says that the new “unreasonable risk” standard increases the likelihood that certain high-risk chemicals will be banned or their uses will be restricted. Additionally, new chemicals and new uses of existing chemicals will also need to be scrutinized under the new “unreasonable risk” standard.

New Company Reporting Requirements

Companies in the chemical supply chain also face new reporting requirements as part of the TSCA Inventory “reset” process. The TSCA Inventory is a list of chemical substances that are manufactured or processed (including imports) in the United States. A chemical substance on the TSCA Inventory is considered “existing,” while those not included are considered “new” and are subject to premarket regulatory requirements. As part of the reset, companies will need to report to EPA those substances that have been manufactured or processed for commercial purposes in the last 10 years. Those substances used in the past 10 years will be deemed “active” and will undergo the risk assessment process described above, while those not reported will be deemed “inactive” and will not be assessed by EPA. It is therefore imperative that companies pay close attention to those chemicals substances that they intend to utilize going forward in connection with the TSCA Inventory reset.

Broader Power to Require Safety Testing

Another departure from the original TSCA is new authority granting EPA the ability to mandate testing or the submission of information through an order. Previously, EPA faced significant hurdles to requiring such testing/information, which had to occur through the cumbersome rulemaking process. Many observers expect that EPA will seek to utilize this new authority to address data gaps by, for example, ordering the development of toxicity and exposure data.

Limits on Confidentiality Claims

An often-heard critique of TSCA has been that claims of confidentiality and trade secrets were overbroad and unnecessary, which led to a lack of transparency. The Lautenberg Act places limits on companies’ ability to make confidentiality claims with respect to certain general information, and will require them to substantiate such claims in accordance with new statutory and regulatory requirements.

Greater Restrictions on Mercury

The Lautenberg Act places greater restrictions and controls over mercury. For example, EPA must publish an inventory detailing the supply, use, and trade of mercury by April 1, 2017. The list must be updated every three years. In addition, EPA must develop and publish guidance on managing and storing, in the short term, elemental mercury. The export of certain mercury compounds will be prohibited beginning January 1, 2020.

New State Preemption Provisions

The scope of preemption – i.e., the extent to which federal law displaces state and local law – was a critical point of contention in the debates over the Lautenberg Act. As originally enacted, TSCA contained a limited preemption provision. As a result, states and localities throughout the country were able to enact a patchwork of regulations, restrictions, and bans on chemical substances, and civil actions for damages remained largely unaffected. The Lautenberg Act provides for broader preemption, albeit less comprehensive than many in the industry had hoped. For example, certain pre-existing state laws and actions for civil damages are not preempted, and states may apply for preemption waivers. On the other hand, if EPA determines that a chemical substance does not present an unreasonable risk under any relevant conditions of use, then states may not enact any law to the contrary. These and other provisions will no doubt be contested and sorted out in the courts in the years to come.

The Road Ahead

The Lautenberg Act and EPA’s implementation of the new law are creating a long to-do list for companies that manufacture, process, import, or use chemical substances. At its core, the Lautenberg Act grants EPA substantial authority and real tools to make scientific determinations and risk management decisions regarding the safety of chemical substances. EPA’s actions will likely lead to not just new regulatory obligations, but also restrictions and/or bans on certain targeted chemical substances – a phenomena often called “product deselection” or “chemical deselection.” Companies should get ahead of the “deselection” process. What chemical substances are critical to your business? Are there readily available substitutes for chemicals likely to be “deselected”? Are there a lack of substitutes for certain uses? What commitments has your company made regarding the use of sustainable materials? The answer to these and other questions will help businesses handle the impacts of the Lautenberg Act.

Republished with permission. This article was first published by Industry Today on October 14, 2016.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Bradley Arant Boult Cummings LLP | Attorney Advertising

Written by:

Bradley Arant Boult Cummings LLP
Contact
more
less

Bradley Arant Boult Cummings LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.