On December 29, 2014, the Environmental Protection Agency (EPA) published a final significant new use rule (SNUR) with potentially broad implications for future chemical management policy under the Toxic Substances Control Act (TSCA).[1]  The SNUR adds nine benzidine-based chemical substances (five from the confidential TSCA inventory) to the existing SNUR for 24 benzidine-based chemical substances.  Like all SNURs, it requires manufacturers (including importers) and processers to notify EPA at least 90 days before starting or resuming new uses of these chemicals.  More unusually, for both the newly-added and the previously-listed benzidine-based substances, the SNUR makes inapplicable the usual exemption for import or processing of the substances as part of an article (i.e., a manufactured item in a specific shape, rather than fluids or particles).  In doing so, this rule breaks with the vast majority of SNURs to date, and illustrates EPA’s more aggressive interpretation of its authority under TSCA.  It likely provides the groundwork and justification for future TSCA rules targeting chemicals in articles.[2] 

In the same rule, EPA also promulgated SNURs for a phthalate, di-n-pentyl phthalate (DnPP), and for a short-chained chlorinated paraffin, alkanes, C-12-13, chloro.  However, the articles exemption is applicable to these two SNURs.  All three SNURs in the December 29, 2014 publication become effective on February 27, 2015.

The implication of EPA’s extensive discussion of its authority to regulate chemicals in articles is that importers of articles and companies that fabricate articles will need the capacity to confirm with their supply chains whether or not particular chemicals are in the imported articles or article components that they purchase. 

Background on Benzidine-Based Chemical Substances

Benzidine and its related chemical substances are mainly used to manufacture dyes used in the production of textiles, paints, printing inks, paper, and pharmaceuticals.  They are also used in laser devices, liquid crystal displays, ink-jet printers, and electro-optical devices.  Benzidine-based dyes were the subject of an EPA Chemical Action Plan published in 2010.[3] EPA is concerned that these dyes can separate from textiles and other applications and be metabolized to benzidine, which is classified as a known human carcinogen.  Other jurisdictions have also imposed restrictions on benzidine-based dyes.  EPA concluded that the chemicals in the benzidine SNUR are no longer in use in the United States (except for certain limited laboratory uses not covered by the SNUR). 

Development of EPA Policy on Chemicals in Articles

TSCA gives EPA authority to regulate chemical substances, including those contained in articles,  but EPA has generally chosen to exempt chemicals in articles from many of its provisions for practical reasons.  EPA has exempted chemicals in articles from information-gathering rules, export and import notifications, premanufacture notifications, SNURs, and other provisions.  The SNUR article exemption at 40 C.F.R. § 721.45(f), in particular, exempts a “person [who] imports or processes the substance as part of an article.”  However, as explained in the preamble of the benzidine-based chemicals SNUR, EPA noted when it promulgated the general SNUR exemptions in 1984 that in any chemical-specific rule, “EPA may decide to eliminate one or all of these . . . exemptions if EPA decides that review under a SNUR is warranted for specific substances . . . in articles.’”[4] 

Since the 1984 promulgation of the general SNUR exemptions, until recently the default articles exemption had been made inapplicable in only three prior SNURs, only two of which remain active (for elemental mercury and erionite fiber), and only for specific kinds of articles.  However, environmental and human exposures to chemicals in articles have been an increasing concern of the Agency and of the public. 

The benzidine-based chemicals SNUR was one of a set of several proposed SNURs from 2012 that proposed to do away with the articles exemption for at least some articles; the others were for hexabromocyclododecanes (HBCD),[5] certain polybrominated diphenyl ethers (PBDEs),[6] and long-chain perfluoroalkyl carboxylate (LCPFAC) chemical substances.[7]  The SNUR for LCPFACs was the first of the group to be finalized;[8] it made the articles exemption inapplicable only for manufacturing, import, or processing only as part of one distinct category of article, carpet.  The benzidine-based chemicals SNUR is of precedential importance because it makes the articles exemption inapplicable for all articles without limitation.  

Effects of the Benzidine-Based Chemicals SNUR

As of February 27, 2015, no one may manufacture (including import) or process any of the listed chemicals for any use, except for a few limited laboratory uses that EPA determined were ongoing, without submitting a significant new use notice (SNUN) 90 days prior to commencement.  The designation of the significant new use is retroactive to the date of the proposed rule, to avoid the potential for uses to become “ongoing” in the time between the proposal and finalization; thus, if any manufacturing or processing of a covered substance has begun since the proposal, it must cease as of the effective date of the rule.  During the 90 day period, which may be extended, EPA can evaluate significant new use and, if it deems necessary based on the information available at that time, may take action to protect against any potential unreasonable risks before the new use occurs.  There are relatively few data requirements for SNUNs, but EPA recommends that submitters consult with the Agency and include data that would permit a reasoned evaluation of risks posed by the chemical substance during its manufacture, import, processing, use, distribution in commerce, or disposal.

The benzidine-based chemicals SNUR, like all SNURs, triggers import notification and export reporting for bulk forms of the listed chemicals.  However, the fact that benzidine-based chemicals in articles are not exempt from SNUN requirements does not affect the articles exemptions from import notification or from export reporting requirements.  Importers of articles containing benzidine-based chemicals are therefore not required to certify the TSCA compliance of their products to Customs and Border Protection.  Nonetheless, article importers may not import such products without first submitting a SNUN.  EPA additionally “has not ruled out a later proposal to require import certification and/or export notification for these chemical substances as part of articles.”[9]

An important practical and legal issue is the extent to which article importers must examine their supply chains or their products if they are uncertain as to whether their articles contain any chemicals subject to the benzidine-based chemicals SNUR.  Importers often face difficulty determining the identity and TSCA status of each and every chemical component of the articles that they import.  However, the SNUR is essentially strict liability (except that unintentionally present impurities are not subject to SNURs).  The preamble explains, “While EPA might potentially take [an importer’s screening practices for determining article constituents] into consideration when evaluating a particular instance in which the SNUR was nevertheless violated, that would be as a matter of enforcement policy, not as a provision of the rule itself.”[10]

EPA Responses to Comments Defend Its Authority to Regulate Chemicals in Articles

EPA received comments from a number of industry groups urging restraint in regulating chemicals in articles under TSCA,[11] but did not veer from its 2012 proposal.  In the preamble to the final rule, EPA strongly defended its legal authority to regulate chemicals in articles under the text and intent of TSCA, including the legislative intent to hold importers to the same responsibilities and obligations as domestic manufacturers.  EPA also refuted comments arguing that it was more appropriate to let other products-focused agencies regulate chemical risks from articles, saying that “[n]either the Occupational Safety and Health Act of 1970 nor the Consumer Product Safety Act of 1972 contains a comparable mechanism to ensure advance notice and opportunity to review significant new uses of chemical substances, as part of articles or otherwise.”[12]

EPA rejected some commenters’ request that EPA complete a separate public comment process to develop a general “policy framework for the issuance of article SNURs,” including criteria based on feasibility, science, costs, and other factors.  EPA stressed that the articles exemption was only a default, based on “a fairly minimal rationale” that can be overcome on a chemical-by-chemical basis by scientific evidence and improved understanding of exposures.  It refused to engage in a broad analysis beyond the specific context of benzidine-based chemicals, saying that it “has not proposed to globally modify or eliminate the SNUR exemption for persons who import or process chemical substances as part of articles.”  The Agency also found unpersuasive the suggestions that it generally should not make the articles exemption inapplicable unless there was a “compelling basis” to do so, or that it should enumerate specific articles or other circumstances for which the exemption would be inapplicable.  EPA stated that “[r]equiring upfront answers to the very questions EPA would evaluate after receiving a significant new use notice, as a pre-condition of requiring the notices, would undermine the statutory authorization to issue SNURs in the first place.”[13]

EPA also disagreed with suggestions to deem importers compliant on the basis of specific screening procedures or levels of effort to obtain knowledge of the composition of imported articles.  (Processors can be shielded by the duty of upstream entities to notify them of the presence of a chemical substance subject to a SNUR.)  EPA stated that this type of “safe harbor” would distort incentives, particularly in the face of ongoing worldwide industry trends toward increasing awareness of article components and constituents.  Based on its own economic analysis, the Agency concluded that the costs of activities such as chemical testing or outreach to suppliers would not be prohibitive; no commenters provided contrary numerical estimates.[14] 

Next Steps

The benzidine-based chemicals SNUR (along with the SNURs for DnPP and alkanes, C 12-13, chloro) becomes effective 60 days from publication, on February 27, 2014.  It is unknown when the final SNURs for HBCD and certain PBDEs will be published.  EPA’s responses to comments in the benzidine-based chemicals SNUR preview some of the points that EPA will likely make in the subsequent SNURs.  (The comment periods on the HBCD and PBDEs SNURs are closed.)  Stakeholders can learn from EPA’s  approach to the benzidine SNUR if EPA proposes additional regulations on chemicals in articles in the future. 

EPA’s actions increase the pressure on importers of articles to build capacity for learning from their supply chains whether or not these benzidine-based chemicals, or other chemicals which may become the subject of SNURs for which the articles exemption is waived, are present in those articles.  Processors who assemble purchased components into final articles will also need to build that capacity.  The preamble notes that Hewlett-Packard and Walmart have developed supplier agreements to manage and share compliance information throughout the supply chain.  While the particular means of finding out information from the supply chain may vary, importers and processors should consider how they will deal with this emerging regulatory expectation that they know the chemicals that are in the products they sell.