[Federal Register: October 17, 2006 (Volume 71, Number 200)]
[Rules and Regulations]
[Page 60823-60827]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr17oc06-12]
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DEPARTMENT OF JUSTICE
Drug Enforcement Administration
21 CFR Part 1310
[Docket No. DEA-254F]
RIN 1117-AA90
Control of Sodium Permanganate as a List II Chemical
AGENCY: Drug Enforcement Administration (DEA), U.S. Department of
Justice.
ACTION: Final rule.
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SUMMARY: On March 1, 2005, the Drug Enforcement Administration (DEA)
published a Notice of Proposed Rulemaking (70 FR 9889) which proposed
the addition of sodium permanganate as a List II chemical because of
its direct substitutability for potassium permanganate (a List II
chemical) in the illicit production of cocaine.
This rulemaking finalizes control of sodium permanganate. As a List
II chemical, handlers of sodium permanganate shall be subject to
Controlled Substances Act (CSA) chemical regulatory controls including
recordkeeping, reporting, and import/export requirements. DEA has
determined that these controls are necessary to prevent the diversion
of this chemical to cocaine laboratories.
This rulemaking is also establishing a cumulative threshold of 55
kilograms and 500 kilograms (respectively) for domestic and
international transactions. As such, all transactions which meet or
exceed these quantities (in a calendar month) shall be considered
regulated transactions, subject to recordkeeping, reporting and/or
import/export notification requirements. Additionally, as a result of
this rulemaking, chemical mixtures having greater than 15 percent
sodium permanganate shall be subject to CSA chemical regulatory control
provisions.
All handlers of the List II chemical sodium permanganate shall also
be subject to the applicable civil and criminal penalty provisions
found in 21 U.S.C. 841, 842, 843, 959 and 960.
DATES: Effective Date: December 18, 2006.
FOR FURTHER INFORMATION CONTACT: Christine A. Sannerud Ph.D., Chief,
Drug and Chemical Evaluation Section, Office of Diversion Control, Drug
Enforcement Administration, Washington, DC 20537 at (202) 307-7183.
SUPPLEMENTARY INFORMATION: The CSA and its implementing regulations,
specifically 21 U.S.C. 802(35) and 21 CFR 1310.02(c), provide the
Attorney General with the authority to specify, by regulation,
additional chemicals as ``List II'' chemicals if they are used in the
manufacture of a controlled substance in violation of the CSA. This
authority has been delegated to the Administrator, Drug Enforcement
Administration (DEA) by 28 CFR 0.100 and redelegated to the Deputy
Administrator under 28 CFR 0.104 (Subpart R) Appendix section 12.
On March 1, 2005, the DEA published a Notice of Proposed Rulemaking
(70 FR 9889) which proposed the addition of sodium permanganate as a
List II chemical because of its direct substitutability for potassium
permanganate (a List II chemical) in the illicit production of cocaine.
Additionally, the Notice of Public Rule Making (NPRM) proposed that a
threshold of 55 kilograms and 500 kilograms be established
(respectively) for domestic and international transactions.
DEA also proposed that chemical mixtures (containing sodium
permanganate) having less than or equal to 15 percent sodium
permanganate shall qualify for automatic exemption from CSA chemical
regulatory controls pursuant to 21 CFR Part 1310. Since DEA recognizes
that the concentration limit exemption criteria cannot identify all
mixtures that should receive exemption status, DEA has implemented an
application process to exempt additional mixtures (21 CFR 1310.13).
This application process was finalized in a Final Rule published in the
Federal Register May 1, 2003 (68 FR 23195). Under the application
process, manufacturers may submit an application for exemption for
those mixtures that do not qualify for automatic exemption. Exemption
status can be granted if DEA determines that
[[Page 60824]]
the mixture is formulated in such a way that it cannot be easily used
in the illicit production of a controlled substance and the listed
chemical cannot be readily recovered (i.e., it meets the conditions in
21 U.S.C. 802(39)(A)(v)). An application may be for a single or a
multiple number of formulations.
Sodium Permanganate Industry and Legitimate Uses
Sodium permanganate is an inorganic oxidant that is a direct
substitute for potassium permanganate. Due to its high solubility in
water, sodium permanganate has distinct advantages over potassium
permanganate in many industrial applications. It is becoming widely
used for industrial purposes, including (1) Printed circuit board
production, (2) pharmaceutical and chemical synthesis, (3) soil and
groundwater remediation, (4) metal cleaning formulations, (5) acid mine
drainage and (6) hydrogen sulfide odor control.
DEA has identified only one domestic producer of sodium
permanganate. However, sodium permanganate is also imported into the
United States (U.S.) and there are at least three other major suppliers
of sodium permanganate in the U.S.
The U.S. firm that manufactures sodium permanganate distributes it
through 15-20 major authorized distributors and more than 100 branch
distributors. This U.S. supplier has advised DEA that it is aware of
``one [sodium permanganate] manufacturer in Germany, more than one
manufacturer in China and at least nine suppliers in other countries.''
Reason for This Control Action
Sodium permanganate is directly substitutable for potassium
permanganate, an important List II chemical used illicitly in the
production of cocaine. Potassium permanganate is widely used as an
oxidizing agent for removing impurities from coca base in the illicit
production of cocaine. Potassium permanganate is utilized because it
produces an aesthetically pleasing, white, crystalline form of cocaine
hydrochloride, which is easily marketed.
Because of its importance in cocaine production, potassium
permanganate has been the target of international cooperative efforts
to monitor potassium permanganate shipments and prevent its diversion.
This effort remains an international priority involving the competent
authorities of 22 countries.
Recently, the world's largest producer of potassium permanganate (a
U.S. company) informed DEA of its recent conversion of production
processes away from potassium permanganate and toward the increased
production and distribution of sodium permanganate. Because of sodium
permanganate's direct substitutability for potassium permanganate, this
company has agreed with DEA concerns regarding the potential illicit
use of sodium permanganate as a direct substitute for potassium
permanganate in cocaine processing. This producer advised DEA that it
would welcome the control of sodium permanganate as a listed chemical.
Even though production of sodium permanganate has historically been
limited, sodium permanganate has been seized by law enforcement at
illicit cocaine laboratories in Latin America. As reported in the 2001
and 2002 Statistical Summary on Drugs, compiled by the Organization of
American States (OAS), and the Inter-American Drug Abuse Control
Commission (CICAD), the Government of Colombia (as reported by the
Colombian Ministerio de Justicia y del Derecho, Direccion Nacional de
Estupefacientes) reported the seizure of 1,400 kilograms of sodium
permanganate in 1997, 236 kilograms in 1998 and 404 kilograms in 1999.
Because of its direct substitutability for potassium permanganate
and increased production, DEA sees the urgent need to regulate sodium
permanganate as a List II chemical to prevent its diversion to cocaine
laboratories. Hence, this rulemaking subjects sodium permanganate to
the same CSA regulatory controls which have been put forth for
potassium permanganate. As such, sodium permanganate shall be subject
to List II chemical controls, including recordkeeping, reporting, and
import/export requirements as specified in 21 CFR Parts 1310 and 1313.
Comments Received in Response to the NPRM
In response to the March 1, 2005, NPRM, DEA received four comments.
One commenter simply stated that they supported the control of sodium
permanganate as a List II chemical.
Another commenter stated that they disagreed with the exemption of
chemical mixtures containing less than 15 percent sodium permanganate,
but did not provide any supportive reason for their opposition.
Two comments addressed the issue of the establishment of a domestic
threshold of 55 kilograms for domestic transactions. One commenter
stated that the threshold was too high and instead suggested that DEA
establish a domestic threshold of 5 kilograms. Another commenter stated
that they believed the 55 kilogram threshold was too low, and stated
that they believed it would increase the recordkeeping burden on
wastewater treatment facilities.
DEA believes, however, that the threshold of 55 kilograms for
domestic transactions will not impact these wastewater treatment
facilities because these facilities are end-users. As such, they are
not required to maintain records and therefore do not incur any
regulatory burden. Their suppliers, however, must maintain records of
all distributions greater than 55 kilograms.
Furthermore, DEA believes that the 55 kilogram threshold for
domestic transactions is appropriate, since this is the threshold that
currently exists for potassium permanganate (which is the direct
substitute for sodium permanganate in these industries.)
One comment was received from the sole U.S. producer of sodium
permanganate. The company stated that it supports DEA's proposal to
control sodium permanganate as a List II chemical. The company further
stated that controls on sodium permanganate should be exactly the same
as the controls which currently exist on potassium permanganate. DEA
agrees.
What This Final Rule Does and Regulatory Controls That Shall Apply to
This Chemical
After careful consideration of all comments, DEA has determined
that all control provisions as proposed in the March 1, 2005, NPRM (70
FR 9889) shall become final. As such, the exact regulatory controls
which currently apply to potassium permanganate shall be implemented
for sodium permanganate effective December 18, 2006.
As a List II chemical, sodium permanganate shall be subject to the
chemical regulatory control provisions and civil and criminal sanctions
of the CSA. As such, recordkeeping, reporting and import/export
notification requirements (as described in 21 CFR Parts 1310 and 1313)
shall apply. As a List II chemical, manufacturers, distributors,
importers and exporters of sodium permanganate will not be required to
register with DEA pursuant to the provisions of 21 CFR Part 1309.
Handlers of this chemical shall be required to maintain records and
meet CSA import/export notification requirements for ``regulated
transactions'' involving sodium permanganate. The CSA (21 U.S.C.
802(39)) defines the term ``regulated transaction'' as a
``distribution, receipt, sale, importation, or exportation of, or an
international transaction involving
[[Page 60825]]
the shipment of, a listed chemical, or if the Attorney General
establishes a threshold amount for a specific listed chemical,'' a
transaction involving a threshold amount. The CSA, therefore, provides
the Attorney General with authority to establish a threshold amount for
listed chemicals if the Attorney General so elects.
DEA is establishing a threshold of 55 kilograms for domestic
transactions and 500 kilograms for international transactions.
Consequently, all transactions which meet or exceed these threshold
quantities shall be considered regulated transactions and be subject to
recordkeeping, reporting and import/export notification requirements of
the CSA.
Regulatory Requirements for Persons Handling Regulated Transactions of
Sodium Permanganate
Records and Reports. The CSA (21 U.S.C. 830) requires certain
records to be kept and reports to be made involving listed chemicals.
Regulations describing recordkeeping and reporting requirements are set
forth in 21 CFR Part 1310. A record must be made and maintained for two
years after the date of a regulated transaction involving a List II
chemical. Only a distribution, receipt, sale, importation, or
exportation of a regulated mixture at or above the established
threshold (e.g. 55 kilograms for domestic transactions and 500
kilograms for international transactions) is a regulated transaction
(21 CFR 1300.02(b)(28)).
Each regulated bulk manufacturer of a regulated mixture shall
submit manufacturing, inventory and use data on an annual basis (21 CFR
1310.05(d)). Bulk manufacturers producing the mixture solely for
internal consumption, e.g., formulating a non-regulated mixture, are
not required to submit this information. Existing standard industry
reports containing the required information are acceptable, provided
the information is readily retrievable from the report.
21 CFR 1310.05 requires that each regulated person shall report to
DEA any regulated transaction involving an extraordinary quantity, an
uncommon method of payment or delivery, or any other circumstance that
causes the regulated person to believe that the listed chemical will be
used in violation of the CSA.
Imports/Exports. All import/exports and brokered transactions of
regulated mixtures shall comply with the CSA (21 U.S.C. 957 and 971).
Regulations for importation and exportation of listed chemicals are
described in 21 CFR Part 1313.
Administrative Inspection. Places, including factories, warehouses,
or other establishments and conveyances, where regulated persons may
lawfully hold, manufacture, or distribute, dispense, administer, or
otherwise dispose of a listed chemical or where records relating to
those activities are maintained, are controlled premises as defined in
21 CFR 1316.02(c). The CSA (21 U.S.C. 880) allows for administrative
inspections of these controlled premises as provided in 21 CFR Part
1316, Subpart A.
Specific Requirements That Will Apply to Regulated Chemical Mixtures
Containing Sodium Permanganate
Effective December 18, 2006, a chemical mixture that is regulated
because it contains greater than 15 percent sodium permanganate will be
treated as a List II chemical. Transactions that meet or exceed the
cumulative monthly threshold of 55 kilograms for domestic transactions
and 500 kilograms for international transactions shall be regulated
transactions.
The regulatory requirements for regulated chemical mixtures
containing List II chemicals are the same as for regulated chemical
mixtures containing List I chemicals, except that registration
requirements do not apply. Therefore, the same requirements for records
and reports, imports/exports (except that pertaining to 21 U.S.C. 957),
and administrative inspection, as outlined above, apply to handlers of
List II regulated chemical mixtures.
Persons who submit an application for exemption (21 CFR 1310.13)
and whose application is pending or subsequently denied by DEA shall be
required to comply with all chemical control requirements, including
recordkeeping and reporting, effective December 18, 2006. Therefore,
all transactions of the chemical mixture would be regulated, if above
threshold, while an application for exemption is pending or awaiting
correction. This is necessary because not regulating these transactions
could result in increased diversion of chemicals desirable to cocaine
traffickers.
Potential Impact of Regulation Upon Industry
In an effort to better estimate the potential impact of this
action, DEA conducted an analysis of various data sources relating to
the manufacture, distribution, and use of the permanganates. This
included an analysis of current chemical producers and marketing
directories (to identify companies listing themselves as sources of
these chemicals).
As previously stated in the NPRM, the DEA has identified only a
limited number of companies which distribute sodium permanganate which
has been either domestically produced or imported. While sodium
permanganate has industrial uses, DEA has not been able to identify any
`household' uses for this chemical. Therefore, the number of firms that
are likely to be affected by this proposed regulation is relatively
small.
This final rulemaking is not considered to have an impact upon a
substantial number of firms, given the limited distribution of this
chemical. Additionally, it is likely that the CSA recordkeeping
requirements are already being met as part of normal business practice.
Since sodium permanganate is being added as a List II chemical there is
no registration requirement. Additionally, DEA is establishing a
cumulative threshold of 55 kilograms for domestic transactions and 500
kilograms for international transactions. Therefore, small transactions
involving research quantities of sodium permanganate will not be
subject to regulatory requirements.
Regulatory Certifications
Regulatory Flexibility Act
The Deputy Administrator hereby certifies that this rulemaking has
been drafted in accordance with the Regulatory Flexibility Act (5
U.S.C. 605(b)), has reviewed this regulation, and by approving it
certifies that this regulation will not have a significant economic
impact on a substantial number of small entities. As noted previously,
this rulemaking is not considered to have an impact upon a substantial
number of firms, given the limited distribution of this chemical.
Further, this impact is being limited by the fact that DEA is adding
sodium permanganate as a List II chemical, rather than the more
stringent requirements of a List I chemical. Additionally, it is likely
that the CSA recordkeeping requirements are already being met as part
of normal business practice. The cumulative threshold of 55 kilograms
for domestic transactions and 500 kilograms for international
transactions established here would remove from regulatory control
small transactions involving research quantities of sodium
permanganate.
Executive Order 12866
The Deputy Administrator further certifies that this rulemaking has
been drafted in accordance with the
[[Page 60826]]
principles in Executive Order 12866 section 1(b). It has been
determined that this is a ``significant regulatory action''. Therefore,
this action has been reviewed by the Office of Management and Budget.
DEA has identified only one U.S. firm which manufactures sodium
permanganate. This firm supports control of sodium permanganate as a
List II chemical.
Paperwork Reduction Act
This rulemaking adds sodium permanganate as a List II chemical
under the CSA. As a List II chemical, there is no requirement of
registration to handle this chemical. Further, as most persons who
handle this product are end-users and, as such, are not required to
maintain records or file reports, there is no impact on these persons.
Handlers of sodium permanganate that distribute above threshold
quantities are required to maintain records. Normal business records
are deemed adequate if they contain the information required in 21 CFR
1310.06. As normal business records meet DEA's regulatory requirements,
the maintenance of these records does not fall under the parameters of
the Paperwork Reduction Act. Further, persons importing and exporting
this List II chemical in quantities of greater than 500 kilograms,
cumulatively, per month, must provide DEA with advance notification of
these transactions. As DEA does not have any information on which to
base an estimate of the impact of this new reporting requirement for
persons importing or exporting sodium permanganate in quantities
greater than 500 kilograms, cumulatively, per month, DEA will adjust
the burden related to this information collection (OMB control number
1117-0023 ``Import/Export Declaration: Precursor and Essential
Chemicals'') upon its renewal.
Executive Order 12988
This regulation meets the applicable standards set forth in
sections 3(a) and 3(b)(2) of Executive Order 12988 Civil Justice
Reform.
Executive Order 13132
This rulemaking does not preempt or modify any provision of State
law; nor does it impose enforcement responsibilities on any State; nor
does it diminish the power of any State to enforce its own laws.
Accordingly, this rulemaking does not have federalism implications
warranting the application of Executive Order 13132.
Unfunded Mandates Reform Act of 1995
This rule will not result in the expenditure by State, local, and
tribal governments, in the aggregate, or by the private sector, of
$115,000,000 or more in any one year, and will not significantly or
uniquely affect small governments. Therefore, no actions were deemed
necessary under the provisions of the Unfunded Mandates Reform Act of
1995.
Small Business Regulatory Enforcement Fairness Act of 1996
This rule is not a major rule as defined by Section 804 of the
Small Business Regulatory Enforcement Fairness Act of 1996. This rule
will not result in an annual effect on the economy of $114,000,000 or
more; a major increase in costs or prices; or significant adverse
effects on competition, employment, investment, productivity,
innovation, or on the ability of United States-based companies to
compete with foreign-based companies in domestic and export markets.
List of Subjects in 21 CFR Part 1310
Drug Traffic Control, List I and List II chemicals, Reporting and
Recordkeeping Requirements.
0
For reasons set out above, 21 CFR part 1310 is amended as follows:
PART 1310--RECORDS AND REPORTS OF LISTED CHEMICALS AND CERTAIN
MACHINES
0
1. The authority citation for part 1310 continues to read as follows:
Authority: 21 U.S.C. 802, 830, 871(b), 890.
0
2. Sec. 1310.02 is amended by adding a new paragraph (b)(12) to read
as follows:
Sec. 1310.02 Substances Covered.
* * * * *
(b) * * *
(12) Sodium Permanganate 6588
* * * * *
0
3. Sec. 1310.04 is amended by adding new paragraphs (f)(2)(i)(H) and
(f)(2)(ii)((J) to read as follows:
Sec. 1310.04 Maintenance of records.
* * * * *
(f) * * *
(2) * * *
(i) * * *
(H) Sodium permanganate ......... N/A ............. 500 kilograms
* * * * *
(ii) * * *
(J) Sodium permanganate ............. N/A ............. 55
kilograms
* * * * *
0
4. Sec. 1310.12 is amended by adding an entry for ``sodium
permanganate'' to the table in paragraph (c) to read as follows:
Sec. 1310.12 Exempt chemical mixtures.
* * * * *
(c) * * *
Table of Concentration Limits
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DEA chemical
code No. Concentration (percent) Special conditions
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* * * * * * *
List II Chemicals.......................
* * * * * * *
Sodium Permanganate..................... 6588 15% by Weight..............
* * * * * * *
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[[Page 60827]]
* * * * *
Dated: September 29, 2006.
Michele M. Leonhart,
Deputy Administrator.
[FR Doc. E6-16990 Filed 10-16-06; 8:45 am]
BILLING CODE 4410-09-P