On June 22, 2016, President Obama signed the Frank R. Lautenberg Chemical Safety for the 21st Century Act (Lautenberg Act) into law, thereby amending, for the first time in its 40 year history, the Toxic Substances Control Act (TSCA). The Lautenberg Act gives TSCA a shot in the arm, promising sweeping change to chemical regulation in the United States.

Background

Enacted in 1976, TSCA regulates the manufacture, import, and processing of chemical substances and mixtures. Historically, EPA’s implementation of TSCA has been hindered by the lack of a clear mandate to EPA to evaluate and regulate the tens of thousands of chemicals which already existed in 1976, and which thus fall beyond the scope of EPA’s pre-manufacture health and safety review program. Moreover, as public interest in open government has increased—particularly concerning decisions related to the safety of consumer products and their ingredients—TSCA’s inability to address concerns about chemical safety has eroded public confidence in the statute itself. The Lautenberg Act addresses these perceived deficiencies by:

  • Requiring that EPA evaluate the safety of existing chemicals in commerce using a prioritization process to begin with those chemicals most likely to cause risks;
  • Mandating the use of a new risk-based safety standard that includes explicit considerations for “vulnerable” populations;
  • Empowering EPA to require the development of chemical information to support these evaluations;
  • Establishing aggressive, enforceable deadlines that ensure timely review of prioritized chemicals and timely action on identified risks;
  • Limiting confidentiality claims and allowing for the sharing of confidential information with States, tribes, and health and environmental professionals; and
  • Providing a source of funding for EPA to carry out these new responsibilities.

Practical Considerations for Industry

New Risk-Based Safety Standard

TSCA’s original language requiring EPA to regulate substances “to the extent necessary to protect adequately against such risk using the least burdensome requirements” constrained EPA’s ability to regulate existing and new chemicals. The Lautenberg Act eliminates this “least burdensome” limitation and so strengthens EPA’s ability to determine that a risk exists. The Lautenberg Act directs EPA to evaluate chemicals purely on the basis of the health risks they pose—without consideration of costs or other nonrisk factors and considering risks to vulnerable groups, like children, pregnant women, and the elderly—and then take steps to eliminate any unreasonable risks identified.

Confidential Business Information

The Lautenberg Act makes it more difficult for companies to assert that chemical ingredients are confidential. Claimants must substantiate their confidentiality claims cogently and clearly because unsupported references to trade secrets, competitive disadvantage, or non-descriptive chemical monikers will no longer suffice. For example, companies must provide a “structurally descriptive” generic name of the substance claimed confidential (that EPA then will provide to the public). The Lautenberg Act also limits the confidentiality protection period to ten years, at which time a company may request a ten-year extension by substantiating the need for a renewal. Companies may seek an unlimited number of extensions. In addition, EPA may require that companies re-substantiate their claims whenever a chemical substance is designated as “high-priority” or “active” (i.e. used in commerce in the United States) or whenever EPA determines that disclosure of protected information would be important in conducting risk evaluations or promulgating rules. The Act also contains exceptions to protection from disclosure, including, but not limited to, requirements to disclose information to health or environmental professionals employed by federal, state, or tribal entities in certain non-emergency situations and to treating physicians, nurses, or other first responders in an emergency. Thus, companies must know the status of their confidentiality claims and be prepared to strengthen and support the same in order to maintain those claims successfully. In fact, if companies do not catalog current confidentiality claims, and so fail to re-assert those claims when EPA designates active substances under the Lautenberg Act, the substances for which claims have not been re-asserted will be moved automatically to the non-confidential portion of the TSCA inventory of existing chemical substances (the TSCA Inventory).

Product Recalls, Deselection, and Innovation

The Lautenberg Act has the potential to broadly impact a wide range of industries. If EPA’s more robust health and safety reviews identify significant health and safety risks, products could not only be recalled, but consumers may flock to products perceived to be “safer.” Thus, companies must know the chemical constituents that comprise their popular products and understand the consequences if EPA determines—or consumers believe—that such constituents pose a risk to human health or the environment or otherwise require testing to better assess their risk. In short, companies that closely follow EPA’s progress in implementing the Lautenberg Act and can adapt to changing market conditions will be poised to benefit under the new TSCA regime.

Participation in Upcoming Rulemakings

Implementation of the Lautenberg Act will require that EPA undertake various rulemakings to effectuate new or additional requirements. Based on EPA’s first-year implementation plan, by mid-June 2017, EPA intends to finalize:

  1. A procedural rule to establish the process and criteria for identifying high-priority chemicals for risk evaluation and low-priority chemicals;
  2. Another procedural rule to establish the process for evaluating the risk of high-priority chemicals; and
  3. A rule to require industry reporting of chemicals manufactured/processed in the previous ten years (this rule will designate active and inactive chemicals on the TSCA Inventory).

For these latter two rules, EPA anticipates publishing rules for public comment by December 2016. This is an extremely ambitious timeline for one, let alone multiple, rules. In addition, EPA plans, within the next two to three years, to propose and finalize regulations concerning the review and substantiation of confidential business information claims, as well as guidance related to generic names for chemicals claimed confidential.

Participation by industry in these rulemakings is critical if EPA is to produce regulations that pragmatically address issues faced by stakeholders and that benefit from their input. Hogan Lovells has extensive experience in advising clients on engaging EPA and other stakeholders during the rulemaking process, and we have experienced lawyers available to work with clients to help them understand and comply with the Lautenberg Act’s new requirements.