Document 3NYVVM1DK0mKyz7pJeovG5Qya

RECEIVED interoffice 2 G 1978 MEMORANDUM LA17 DEPT. C. E. Blades From E. I. Handwerk cc: R. H. Schenck Subject 25 October 1978 TSCA Legality Chemical Technical Administration (Location, Organization, or Department) Chemical Technical Administration (Location, Organization, or Department} The Hi-lited section on the attachment resolves your concern as to whether a converter of raw materials not on the Existing Chemicals Inventory Is in violation of TSCA. Yes, as a "user" of these materials he violates the act. However, the violation does not exist until after publication of the revised inventory. EIH/sp Attachment E, I. Handwerk AP00049850 RULES AND REGULATION &1573 port chemical substances as a part of a mixture or article may report during the special reporting period. EPA expects to publish a revised inventory based on these additional report# sometime In fall 1979. Small Manufacturer As provided in TSCA section 8(a) and discussed in the preamble to the August 2 proposal, EPA may require "small manu facturers" to submit only Information necessary for compilation of the Inven tory or concerning a chemical substance which is subject to a proposed rule or order under TSCA section 4, 5 or 8 or court action under section 5 or 7. At this time, any person who Ls required to re port and who is a small manufacturer is only required to submit information re quired for compilation of the inventory. Accordingly, any "small manufacturer" need only identify chemical substances and report certain limited information required for purposes of the Inventory. Small manufacturers are exempt from reporting production volumes and, if a small manufacturer has more than one plant site, he need not separately report for each site. Since these regulations de fine 'manufacture" to include "import," the provision applies equally to "small importers." The definition of "small manufacturer or importer1' proposed in August has been revised to exempt from these addi tional reporting requirements those man ufacturers and importers with total sales of less than $5 million. This exemption, however, does not apply with respect to any chemical substance produced by a manufacturer at one site or Imported in quantities equal to or greater than 100.000 pounds during calendar year 19*77. Accordingly, no manufacturer will be considered a "small manufacturer or im porter'' with respect to any chemical sub stance manufactured at one site or Im ported In quantities over 100,000 pounds. In deciding how to define "small man ufacturer or Importer," EPA considered both the relative burden to manufac turers and importers to submit additional information and the value of that Infor mation to EPA and other federal agen cies. Under this definition, (he total cost of reporting for the inventory for the marglual small firm. In most cases, will be about l percent of profit#. While the firms exempted under this definition rep resent nearly 80 percent of chemical firms, they account for only 4 percent of sales of chemical substances and only S percent of employment in 3IO groups 28 and 2911, In the interest of creating a data base that Is at least complete with respect to the volumes of those chemical substances produced in substantial quantities, this definition does not exempt any manufac turer or importer from reporting the vol umes of individual substances produced in quantities of over 100,000 pounds dur ing calendar year 1977. Reporting pro duction volume will Involve simply pro viding the digit that is associated with a broad range (e.g., "4" is for production between 1 million and 10 million pounds), as provided in the table at I 710.5(d) (4). Since the manufacturer or importer will already be reporting the names of sub stances, the additional burden of supply ing production information in terms of large range* should be minimal, espe cially for substance# produced In signifi cant quantities. Retorting Schedule and Enforcement These regulation* provide for publica tion of an initial inventory based on re porting by manufacturers and Importers of chemical substances, followed by pub lication. of a revised inventory based on reporting by processors of chemical sub stances and importers of chemical sub stances as part of mixtures and articles. Reporting for the initial inventory will begin on January 1,1978, and end May 1, 1978. Manufacturers and importers of chemical substance# must report, as pro vided in i 710.3(a), during this first re porting period. Processors are only sub ject to the second reporting period which will begin after publication of the Initial Inventory and end 210 days later. Thirty days after publication of the in itial inventory, premanufacture notifica tion will begin. Alter that date, any per son who intends to manufacture or im port (in bulk) a chemical substance not included on the inventory must submit premanufacture notice under section 5 (a)(1)(A). Processors and users of a chemical substance for a commercial purpose, and importers of a chemical sub stance as a part of a mixture or article will be able to supplement the Initial in ventory during the second reporting pe riod, a* provided in 1710.3(b). TSCA section 15(1) makes it unlawful for any person to fall or refuse to comply with the premanufacture notification re quirements of section 5. TSCA section 15(2) makes it unlawful for a person to use for a commercial purpose any sub stance which he had reason to know was manufactured in violation of section 5. Sections 15(1) and 15(2) as they relate to section 5(a)(1)(A) will not be ap plied to persons who process or use for a commercial purpose chemical substances not on the inventory or who import chemical substances a* a part of a mix ture until after publication of the revised Inventory. By reporting any chemical substance, not included on the initial inventory during the second reporting period, these persons will be. able to pro tect themselves from proseoution under section 15 (2) with respect to the require ments of sectipn 5(a)(1)(A) of TSCA. Importers of a chemical substance as part of a mixture or article will not be subject to premanufacture notification requirements for "new" chemical sub stances until 30 days after publication of the revised Inventory. Under these re porting requirements, persons who im port chemical substances a* part of arti cles do not have to report concerning those chemical substances for the initial Inventory. BPA is still considering whether importers of certain chemical substances as part of articles will be sub ject to premanufacture notification re quirements under section 5(a)(1)(A). EPA will address this Issue prior to pub lication of the initial Inventory. Refer to comment* 18 to 33 for further clarifi cation of these Issues concerning im porters of chemical substances. Finally, EPA recognizes that it Is in evitable, considering the large volume of information to be complied and trans mitted, that there may be some uninten tional clerical errors in reporting. Ac cordingly. the note In i 710.1(b) of these regulations provides that EPA does not intend to focus its enforcement efforts on reporting violations that are clerical in nature. Instead, EPA will give priority to bringing actions against persons who (l) report false Information, (2) report for inclusion on the inventory chemical substances which are excluded under section 710.4(c) of these regulations, (3) fall to report, or (4) fall to maintain records documenting reported information. Confidentiality As discussed in the preamble to the August proposal, there ls an apparent conflict between section 14 and sections 8(b) and 5(a) of TSCA with respect to the inclusion of the identities of certain chemical substances on the inventory. Section 8(b) requires EPA to publish a list of "each chemical substance which is manufactured or processed in the United States. Such list shall include each chemical substance which anv per son reports, under section 5 or subsection (a) of tbia section, ls manufactured or processed In the United states." (em phasis added) The list has two purposes, to inform the public concerning which chemical substances are manufactured or processed for a commercial purpose and to which the public may be exposed, and to define what constitute* a "new chemical substances1' for purposes of premanufacture notification require ments under section S(a), However, sec tion 14 states that any information re ported to EPA under TSCA that is ex empt from disclosure under the Freedom of Information Act fourth exemption (5 UB.C. 552(b)(4)) may not be disclosed except in specific circumstances set out in section 14 (a) and (b). In the absence of the requirement* of section 8<b) and 5(a), EPA would pub lish an inventory that would not include the identities of specific chemical sub stances for which the fact that the par ticular substance is manufactured or processed for commercial purposes is confidential. En the absence of the re quirements of section 14, EPA would pub lish a list of off chemical substances manufactured or processed for com mercial purposes..Slnce the term manu facture includes "to import", this dis cussion and the regulations apply equally to Imported chemical substances. Having no explicit statutory guidance about how to resolve this conflict, EPA has attempted to balance the concerns of section 14 with those of sections 8(b) and 5 (a). EPA believes that Congress did not Intend manufacturers to be required to furnish EPA premanufacture notifica tion on existing chemical substances whose Identities for purposes of the ln- FEDERAL REGISTER, VOt. 42, NO. 247--FRIDAY, DECEMBER 23, 1977 AP00049851