On October 11, the United States Environmental Protection Agency (U.S. EPA) finalized new per- and polyfluoroalkyl substances (PFAS) reporting requirements under the Toxic Substance Control Act (TSCA). This new regulation will require reporting of PFAS in products within 18 months of November 13, 2023.
In several ways these new rules are much more comprehensive than previous efforts in the United States. The impetus for the law is also the main challenge that many companies will now face – the extent of PFAS use in products is often not well known. These new reporting requirements will be a major administrative undertaking for many companies and will require increased collaboration across global supply chains.
Requirements represent EPA shift
The broad scope of the new regulation is a shift for the EPA regarding those that must provide information as well as the compounds covered by the new reporting requirements. EU regulators had already proposed comprehensive restrictions in which PFAS are defined by chemical structure in February 2023, but the U.S. previously imposed PFAS regulations and reporting requirements on a compound-by-compound basis.
While this latest measure is mainly an additional administrative step, it will include compounds such as fluoropolymers (Teflon) and fluorinated gases (most refrigerants) that were left out of previous EPA efforts.
Critics of the more comprehensive PFAS approach argue that only water-soluble PFAS compounds have the environmental and health effects that necessitate regulations. Proponents of a comprehensive PFAS definition argue that slightly altered PFAS compounds can enter the market quicker than health studies and regulators can keep up, making more comprehensive regulations necessary.
Thousands of products affected
The EPA requirement calls for reports of even minor amounts of PFAS within imported finished consumer products. This will require many companies to take a closer look at the flow of goods within their supply chains than they may have previously. The EPA has clarified that the only information required is that which is known or reasonably ascertainable, which they have clarified to mean all information in a person’s possession or control, plus all information that a reasonable person similarly situated might be expected to possess, control, or know. Though this clarification offers some leeway, many companies will still face a difficult task in gathering this information.
There are thousands of products that contain at least one PFAS component. Analysis of global trade data can provide insights on the types of PFAS that are most likely to be found in various products. Fluoropolymers (Teflon), flouroelastomers (Viton), and fluorinated gases (Freon and Novec) are the most widely used by a large margin. These products have very favorable properties and are found in every corner of the supply chain. Fluoropolymers are used when inert or low-friction plastics are needed, including in industries such as electronics, medical devices, and textiles. Fluorinated gases are the most common heat transfer fluid and are found in most refrigeration and air conditioning units.
Smaller companies must now report
Two groups that had previously been excluded from similar reporting measures are small companies and those manufacturing below the minimum quantities of reportable materials. While large, established manufacturers will now grapple with the challenge of sorting through vast datasets to gather necessary information, these smaller players face the challenge of finding the resources to comply with administrative requirements they may not have experience in or lack the manpower to address.
Large manufacturing companies are more likely to have the technical staff on hand to understand and comply with the regulation, but the EPA recognizes the burden the regulation will place on small companies and has offered six extra months for them to submit the required information, giving them a total of two years to comply with the new regulations. Even so, many small manufacturers and importers are entering uncharted territory in having to report this type of information for the first time.
Small manufacturers and importers in global supply chain networks may be at higher risk of non-compliance with the regulation, which could lead to supply disruptions. The risk of this is likely low for most companies, but small yet critical companies in a supply chain network may warrant an inquiry on whether they foresee any challenges regarding the requirement. These issues will apply to all industries, as PFAS are very pervasive, but is especially important in industries connected to textiles, electronics, cleaning products, packaging, medical devices, and cooling due to an anticipated higher amount of PFAS in these supply chain networks.
The breadth of this new regulation compared to previous efforts means it is likely that some smaller companies have not yet realized that they are included in this requirement.
Industry representatives raise concerns
Manufacturers and importers raised several concerns with the EPA during the rulemaking process. They mainly opposed the aspects that differ from previous EPA TSCA requirements, including the broader definition of PFAS, the inclusion of reporting for imported articles, and the inconsistency in exemptions offered between this and other chemical reporting requirements. As this reporting falls under the Toxic Substance Control Act, non-compliance could result in civil penalties or criminal charges for companies that do not meet them.
Everstream clients are receiving more detailed insights and recommendations about this risk.
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