On June 22, 2016, President Obama signed into law the Frank R. Lautenberg Chemical Safety for the 21st Century Act (the Act) which amends the core provisions of the Toxic Substances Control Act (TSCA), an environmental law whose use and enforcement has dwindled somewhat over the years (Available here). TSCA regulates chemical manufacturing and usage, and has not been substantially amended since it was enacted in 1976. The Act, which enjoyed bilateral support in both the House and Senate, updates TSCA to provide EPA with the discretion to prioritize the chemicals it regulates. The 2016 version expands and supports EPA’s authority to regulate industry and enforce the regulations.  The key elements are:

1. Risk Assessment — EPA is required to review the safety of and to prioritize all chemicals in active commerce. For chemicals the EPA classifies as high-priority, the EPA must conduct a risk-based assessment to determine whether the chemicals pose an unreasonable risk.  The risk-based assessment evaluates the impact of the chemical to human health and the environment.

Importantly, the EPA may not consider “costs or other nonrisk factors” in determining whether to regulate a chemical.  The costs and benefits of  the regulation, including  the availability of alternatives to the chemical, may be considered in determining how to regulate the chemical. However, in all cases, chemicals found to pose an unreasonable risk must be regulated “so that the chemical substance no longer presents such a risk” and to ensure the protection of sensitive populations.  The Act allows anyone to challenge the EPA’s classification of a chemical as “low priority.”

2. Power to Order Testing — The Act empowers EPA to issue an order requiring testing without first having to promulgate a rule or show evidence of a potential risk or high exposure.  Currently, EPA must go through a consent agreement which can be slow and formal.

3. Inventory — EPA must maintain an up-to-date inventory of all chemicals in commerce.

4. Preemption — Federal regulation explicitly preempts states from regulating chemicals under the purview of TSCA.  Preemption is always an issue as companies must comply with a patchwork of state regulation as well as federal.  Under the updated TSCA, the federal government has preemption over the states for regulating a chemical which it has found presents an unreasonable risk.  In the event the federal government finds the opposite, that the risk of chemical is acceptable, then a state may step in and regulate. However, all state actions taken prior to April 22, 2016 are preserved.

5. Hold, please — EPA can hit the “pause” button.  While EPA is assessing the risk of a certain chemical, states may not regulate that chemical.

Simply looking at items 1-3 above, it is clear that the Act invigorates the existing chemical regulatory regime and empowers EPA to prioritize the field and demand testing. The Act also borrows from the Registration, Evaluation, Authorization and Restriction of Chemicals (REACH) program in the European Union, which is considered a success and has been used as a template for chemicals management by countries outside of the EU. Within the United States, however, this approach is new and far reaching.

Assessing and prioritizing every chemical in active commerce – and then keeping the inventory of the chemicals current — is a large task.  Many industries will feel the impact.  If a company uses chemicals in making products, it may be worthwhile to analyze the breadth of the updated TSCA.  Manufacturing toys or cosmetics may now trigger new environmental compliance challenges.

The Act also places tighter parameters around a company’s ability to shield information about active chemicals from the public, including setting a 10-year expiration for all confidential business information claims unless the claim is substantiated again.  Companies requesting confidentiality should calendar updates to keep the protections in place.

EPA now has specific power to act and it will act quickly.  The Act imposes aggressive implementation deadlines, requiring EPA to develop rules for the inventory, prioritization and risk evaluation processes within one year; develop all policies and guidance within two years;  and conduct at least 20 risk evaluations and 20 low-priority designations within 3.5 years. Including a certain workload and schedule is a rather rare requirement for environmental regulation, but it shows that Congress wanted EPA to actually use these new procedures. TSCA has been jumpstarted by this upgrade, but the government does not want to see it lay fallow. Therefore, companies should be prepared to see changes based on these amendments happen within the next few years.