It’s rare when a statement in legislative testimony so succinctly sums up a situation.
“The crazy aunt the family didn’t talk about and tried to forget,” is what Environmental Working Group’s Kenneth Cook called the U.S. EPA’s Toxic Substance Control Act while testifying in June to a House of Representatives committee about TSCA, which was initially passed back in 1976.
The view that TSCA needs modernization is almost universally shared among regulators, the regulated, and environmental, health and safety groups. The question is how to modernize it without the unintended consequences of removing incentives to develop new and less harmful chemicals, or forcing essential or strategic chemicals off the market.
The regulatory system currently allows a chemical into commerce unless it poses a known environmental or health risk based on available information and data. Proposed changes shift to a system that prohibits use of a chemical unless it is proven safe by the manufacturer, rather than simply showing it is not unsafe based on available data.
In April, Sen. Frank Lautenberg (D-NJ), announced legislation to overhaul TSCA. It is near certain that TSCA will be revised in 2011, and those changes will flow down to almost all chemical manufacturers and users. Legislative efforts already are sparking debate on wide-ranging liabilities companies might face under a new TSCA regime.
Minimum Data Set
This proposal requires submission of minimum data sets for all chemical substances and mixtures, including information on substance characteristics, hazard, exposure, and use. Data sets for chemicals already recognized will be required within five years. The inclusion of mixtures pulls many manufacturers into TSCA for the first time.
So instead of simply reviewing and compiling existing information on a chemical’s safety, manufacturers actually will need to develop data to prove the chemical safe. There are provisions for utilizing data developed by others, however, the draft formula for compensating companies for data appears to be an invitation to litigation between companies regarding that data use, both in terms of value and confidentiality. Minimum data requirements also would apply to chemicals already approved, so a chemical once viewed as acceptable may no longer be insulated from the new burden of proof that it is safe.
Under the proposal, the EPA would establish a priority list of no fewer than 300 of the over 80,000 listed chemical substances for which safety standard determinations will be made first. Manufacturers and processors of listed chemicals would be required to submit data enabling EPA to make a safety standard determination. The EPA would apply a standard ensuring a “reasonable certainty of no harm” and protecting the public welfare from adverse effects. Manufacturers and processors bear the burden of meeting that standard. What a “reasonable certainty” is has not been resolved.
The EPA would have to make a determination within six months after submission of all necessary information. If the agency determines that the chemical substance or mixture has not been shown to meet safety standards, the chemical would be removed from commerce. That determination would remain in effect for 15 years, unless a new use of the substance or mixture is proposed or new information warrants a redetermination.
It is not difficult to imagine the disruption to a manufacturer’s business if a core chemical it produces or uses, which has been on the approved list for some time, is suddenly subject to review, shown not to meet the safety standard, and removed from commerce.
Proposals would allow companies to request exemptions for specific uses. The EPA could grant such requests to protect national security, prevent significant disruption of the economy, and allow critical or essential uses for which no substitutes are available, or to allow uses that provide a net benefit to health or the environment over alternatives. Exemptions would expire after five years, but could be renewed.
The EPA would publish standards that specify acceptable bases for claiming confidentiality – to provide notice and clarity for manufacturers, processors, agency employees, and the public. The EPA would review confidentiality requests within 60 days. If denied, it would be required release information to the public. Approvals would specify a confidentiality period of not greater than five years.
Committing time and effort to develop a new chemical, only to have trade secrets made public in five years is unrealistic. Five years of confidentiality compared to the years invested in developing a new chemical eliminates incentives to develop new, safer materials.
One of the most worrisome and unresolved factors is the legislation’s handling of nanotechnology. The EPA recognizes that the existence of structures at the nano level may exhibit a distinct set of chemical, physical, and biological properties and already has reviewed for a number of nanoscale materials. Because nanomaterials are already prevalent in society and used in products from sunscreens and cosmetics, to water-resistant clothing and even windmills, there is increasing concern about their health and safety impacts.
While the EPA has taken steps to directly regulate potential risks associated with the manufacture and use of nanomaterials, TSCA reform surely will solidify the agency’s authority. The legislation and EPA's actions strongly indicate an increasing reliance on new and existing statutory authorities over voluntary industry efforts to address these risks.
The draft legislation is very clear in granting authority to the EPA to approach nanomaterials aggressively. For one, definitions have been revised to include the new term “special substance characteristics” (SSC). The language of this definition makes it clear that in determining SSC, the EPA may consider broad factors other than molecular identity, such as size and size distribution, shape and surface structure, reactivity, and any other properties that may affect risks posed. The concern is that nanomaterials, because of their small size, may be more chemically reactive, have different strength or electrical properties, or be more mobile than similar materials larger in scale.
As a result of these EPA actions, companies that currently manufacture or import nanomaterials, or incorporate them in products, must evaluate the legal implications under TSCA, both now and after reform efforts are completed.
If enacted, the TSCA reforms will provide more support and certainty that chemicals and products in commerce present safe exposure without unnecessary risks to people and the environment. But there is no question that it brings additional cost to everyone: regulators, the regulated, and consumers.
Mr. Hayes is an attorney and a partner in the Vorys, Sater, Seymour and Pease firm in Cincinnati office. He is a member of the energy, environment and utilities practice group, focusing on air quality issues. He often provides strategic advice to manufacturing clients regarding plant expansions and processing changes; enforcement defense in matters brought by local, state and federal environmental agencies. He also advises clients on TSCA compliance matters, including nanotechnology regulatory developments. He can be reached at 513-723-4000, or WDHayes@Vorys.com.