Vol. 58 No. 27 Thursday, February 11, 1993 p 8136 (Rule)
1/4377
ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 82
[FRL-4557-1]
RIN 2060-AD47
Protection of Stratospheric Ozone; Labeling
AGENCY: Environmental Protection Agency (EPA).
ACTION: Final rule.
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SUMMARY: This final rule establishes labeling requirements for
products manufactured with, containers of, and products containing
specific ozone-depleting substances pursuant to section 611
of the Clean Air Act, as amended. Specifically, the regulations
require products that are manufactured with a process using
a class I substance currently defined as chlorofluorocarbons
(CFCs), halons, carbon tetrachloride, methyl chloroform, products
containing a class I substance and containers of a class I or
class II substance (hydrochlorofluorocarbons (HCFCs)) or mixture
to bear a "clearly legible and conspicuous" warning statement.
The substances affected by today's final rule are class I
substances
and class II substances, as defined in 40 CFR part 82, appendix
A to subpart A and in any later rulemaking.
EFFECTIVE DATE: The final regulation is effective on March 15,
1993. The information collection requirements contained in 40
CFR 82.122 have not been approved by the Office of Management
and Budget (OMB) and are not effective until OMB has approved
them. An announcement of the effective date of 40 CFR 82.122
will be published in the Federal Register.
ADDRESSES: Comments and materials supporting this rulemaking
are contained in Public Docket No. A-91-60 in room M-1500,
Waterside
Mall (Ground Floor), U.S. Environmental Protection Agency, 401
M Street, SW., Washington, DC 20460. Dockets may be inspected
from 8:30 a.m. until 12 noon, and from 1:30 p.m. until 3 p.m.,
Monday through Friday. A reasonable fee may be charged for copying
docket materials.
FOR FURTHER INFORMATION CONTACT: Kate Van Slyck, Stratospheric
Ozone Protection Branch, Stratospheric Protection Division,
Office of Atmospheric Programs, Office of Air and Radiation
(6202-J), 401 M Street, SW., Washington, DC 20460. (202) 233-
9742. The Stratospheric Ozone Information Hotline at 1-800-296-
1996 can also be contacted for further information.
SUPPLEMENTARY INFORMATION: The contents of today's preamble
are listed in the following outline:
I. Background
A. Ozone Depletion
B. Montreal Protocol
C. Excise Tax
D. London Amendments to the Montreal Protocol
E. Clean Air Act Amendments of 1990, Title VI
F. Requirements of Section 611
II. The May 4, 1992 Notice of Proposed Rulemaking
III. Accelerated Phaseout
1. New Scientific Data Regarding Ozone Depletion
2. Copenhagen Revisions to the Montreal Protocol
3. The Proposed Accelerated Phaseout Regulation
4. Effect of Accelerated Phaseout on Labeling Regulation
IV. Summary of Public Participation
V. Response to Significant Comments
A. Definition of Interstate Commerce and Introduction into
Interstate
Commerce
B. Products Manufactured Before May 15, 1993
C. Products Manufactured With Controlled Substances
1. Changes to the Label Pass-Through Requirement
a. Resin Producers and the Use of One Label
2. Incidental Uses
3. Transformation
4. Destruction
5. Use Reduction Exemption for CFC-113 and Methyl Chloroform
Used as Solvents
D. Products Containing and Containers Containing
1. Distinction Between "Products Containing" and "Containers
Containing" and Label Requirement
2. Label Pass-through Requirement for "Products Containing"
and "Containers Containing"
3. Containers of Recaptured Substances and Waste
4. Trace Quantities of Unintended Residues or Impurities
E. Use of Controlled Substances for Repairs and Used Products
F. Label Placement and Alternative Labeling Options
1. Label Placement
a. Clearly legible and conspicuous
2. Alternative Labeling Options
a. Alternative Labels
b. Supplemental Printed Material
c. Products not Viewed by the Purchaser Prior to or at the Same
Time of Purchase
d. Competing Information.
e. Parallel to Existing Information
G. Products Manufactured for Export Only
H. Imports
I. Medical Products
J. Packaging
K. Research and Development
L. Warning Statement Text and Requirement
M. Recoverable Substances Label
N. Symbol
O. Petition Process
VI. Summary of the Final Rule and Changes from the Proposed
Rule
VII. Effective Date
VIII. Summary of Supporting Analyses
A. Regulatory Impact Analysis
B. Regulatory Flexibility Analysis
C. Paperwork Reduction Act
IX. References
I. Background
A. Ozone Depletion
The stratospheric ozone layer protects the earth from
ultraviolet
(UV-B) radiation. Research begun in the 1970s indicated that
when certain industrially produced halocarbons (including
chlorofluorocarbons
(CFCs), halons, carbon tetrachloride and methyl chloroform)
are released into the environment, they migrate into the
stratosphere,
where they contribute to the depletion of the ozone layer. To
the extent depletion occurs, penetration of the atmosphere by
UV-B radiation increases. Increased exposure to UV-B radiation
produces health and environmental damage, including increased
incidence of skin cancer and cataracts, suppression of the immune
system, damage to crops and aquatic organisms, increased formation
of ground-level ozone and increased weathering of outdoor plastics.
B. Montreal Protocol
In response to growing evidence that chlorine and bromine
could destroy stratospheric ozone on a global basis and the
discovery of the ozone hole over Antarctica, many members of
the international community came to the conclusion that an
international
agreement to reduce global production of ozone-depleting substances
was needed. Because releases of CFCs from all areas mix in the
atmosphere to affect stratospheric ozone globally, efforts to
reduce emissions from specific products by only a few nations
could quickly be offset by increases in emissions from other
nations, leaving the risks to the ozone layer unchanged. EPA
evaluated the risks of ozone depletion in Assessing the Risks
of Trace Gases That Can Modify the Stratosphere (1987) and
concluded
that an international approach was necessary to effectively
safeguard the ozone layer.
EPA participated in negotiations organized by the United
Nations Environment Programme (UNEP) to achieve an international
agreement to protect the ozone layer. In September 1987, the
United States and 22 other countries signed the Montreal Protocol
on Substances that Deplete the Ozone Layer. The 1987 Protocol
called for a freeze in the production and consumption (defined
as production plus imports minus exports of bulk chemicals)
of CFC-11, -12, -113, -114, -115, and halon 1211, 1301 and 2402
at 1986 levels, and a phased reduction of the CFCs to 50 percent
of 1986 levels by 1998. Currently, over 90 nations representing
well over 90 percent of the world's consumption are parties
to the Protocol.
In an August 12, 1988 final rulemaking (53 FR 30566) EPA
promulgated regulations implementing the requirements of the
1987 Protocol through a system of tradable allowances. EPA
apportioned
these allowances to producers and importers of these "controlled
substances" based on their 1986 levels. To monitor industry's
compliance with the production and consumption limits, EPA required
recordkeeping and quarterly reporting and conducted periodic
compliance reviews and inspections.
C. Excise Tax
As part of the Omnibus Budget Reconciliation Act of 1989,
Internal Revenue Code of Ozone-Depleting Substances, section
506A of Public Law 101-239, the United States Congress levied
an excise tax on the sale of CFCs and other chemicals which
deplete the ozone layer, with specific exemptions for exports
and recycling. The tax went into effect on January 1, 1990,
and increases annually. The original excise tax was amended
by the Omnibus Budget Reconciliation Act of 1991 to include
methyl chloroform, carbon tetrachloride and the other CFCs
regulated
by the amended Montreal Protocol and Title VI of the Clean Air
Act, as amended in 1990. The Energy Policy Act of 1992, section
1931 of Public Law 102-486, revised and further increased the
excise tax, effective January 1, 1993. By raising the cost of
virgin controlled substances, the tax has created an additional
incentive for industry to shift out of these substances and
increase recycling activities, and it has encouraged the
development
of a market for alternative chemicals and processes.
D. London Amendments to the Montreal Protocol
Under Article 6 of the Montreal Protocol, the Parties are
required to assess the science, economics and alternative
technologies
related to protection of the ozone layer every two years. In
response to this requirement, the Parties issued their first
scientific assessment in 1989 (Scientific Assessment of Ozone
Depletion, which has been placed in the docket for this
rulemaking.)
During this assessment, scientists examined the data from land-
based monitoring stations and the total ozone mapping spectometer
(TOMS) satellite and found that there had been global ozone
depletion over the northern hemisphere as well as over the southern
hemisphere. The scientific assessment also reported that a three
to five percent decrease in stratospheric ozone levels had occurred
between 1969-1986 in the northern hemisphere in the winter months
that could not be attributed to known natural processes.
At the Second Meeting of the Protocol Parties, held in London
on June 29, 1990, the Parties responded to this new evidence
by tightening the restrictions placed on these chemicals. The
Parties to the Protocol passed amendments and adjustments which
called for a full phaseout of the already regulated CFCs and
halons by 2000, a phaseout of carbon tetrachloride and "other
CFCs" by 2000 and a phaseout of methyl chloroform by 2004. The
Parties also passed a non-binding resolution regarding the use
of hydrochlorofluorocarbons (HCFCs) as interim substitutes for
CFCs. Partially halogenated HCFCs add much less chlorine to
the stratosphere than the fully halogenated CFCs, but still
pose a significant threat to the ozone layer, (See 56 FR 2420
January 22, 1991 for more information on the relative effects
of different ozone-depleting substances).
E. Clean Air Act Amendments of 1990, Title VI
On November 15, 1990, the Clean Air Act Amendments of 1990
were signed into law. The requirements in Title VI of the amended
act include phaseout controls similar to those in the London
Amendments, although the interim targets are more stringent
and the phaseout date of methyl chloroform is earlier (section
604). Other Title VI provisions require EPA to promulgate
additional
controls pertaining to the protection of the stratospheric ozone.
These provisions: (1) Restrict production and consumption of
HCFCs (section 605); (2) restrict the uses of controlled ozone-
depleting substances, including provisions to reduce emissions
of controlled substances to the "lowest achievable level" in
all use sectors (section 608); (3) require the recovery and
recycling of refrigerant when servicing motor vehicle air
conditioners
(section 609); (4) ban nonessential products (section 610);
(5) mandate warning labels (section 611); (6) establish a safe
alternatives program (section 612); and (7) require revision
of federal procurement policies to minimize government use of
ozone-depleting substances. EPA has already promulgated regulations
implementing the phaseout provisions contained in section 604
of the Act (57 FR 33754) and the section 610 ban on nonessential
uses. EPA is currently in the process of promulgating regulations
under several other sections of Title VI.
One of the provisions of the Act which complements the labeling
requirement is the Significant New Alternatives Program (SNAP)
established under section 612. The Advance Notice of Proposed
Rulemaking for SNAP was published in the Federal Register on
January 16, 1992 (57 FR 1984); the Notice of Proposed Rulemaking
is currently being prepared for publication. The SNAP program
has been established to evaluate the overall effects on human
health and the environment of the potential substitutes for
ozone-depleting substances. Rules promulgated under SNAP will
render it unlawful to replace an ozone-depleting substance with
a substitute chemical or technology that may present adverse
effects to human health and the environment if the Administrator
determines that some other alternative is commercially available
and that this alternative poses a lower overall threat to human
health and the environment. The SNAP program is a powerful tool
for ensuring that "safe" alternatives are developed.
F. Requirements of Section 611
The rule being promulgated today implements section 611 which
prohibits, effective May 15, 1993, the introduction into interstate
commerce of any container containing class I and class II
substances,
product containing class I substances and product manufactured
with class I substances, unless it bears a warning statement
indicating that the product contains or is manufactured with
ozone-depleting substance(s). The section extends the prohibition
after May 15, 1993, and before January 1, 2015, to any products
containing, or manufactured with class II substances if the
Administrator determines that safe alternatives are available.
Beginning January 1, 2015, all products containing or manufactured
with class I or class II substances must also be labeled. While
the label provisions have different effective dates for products
containing and manufactured with class I substances, as compared
to products containing and manufactured with class II substances,
the requirements in the regulation are the same for products
"manufactured with" and products "containing" such substances
unless otherwise indicated. The term "controlled substance,"
defined in the regulation, will be used to refer to both class
I and class II substances where the labeling requirements apply
to both substances.
II. The May 4, 1992 Notice of Proposed Rulemaking
In a notice of proposed rulemaking published on May 4, 1992
(57 FR 19166), EPA proposed regulations to implement section
611. (It should be noted that EPA considers section 611 to be
self-implementing except for those prohibitions that require
an EPA determination to be triggered (see, e.g., section
611(c)(1)).
Consequently, products covered by section 611 would have to
be labeled even if EPA did not promulgate implementing regulations.
Specifically, EPA proposed that effective May 15, 1993, labels
be required on containers of class I and class II substances
and products containing or manufactured with class I substances.
The proposal also called for labels on all products containing
or manufactured with class I or class II substances, beginning
on January 1, 2015.
EPA proposed definitions for the terms "class I substance
and class II substance," "container," "containing or contains,"
"incidental uses," "manufactured with," "potentially available,"
"principal display panel," "product," "recoverable substance,"
"supplemental printed information," "transform," "ultimate
consumer,"
"type size," and "warning label." While many of the proposed
definitions were consistent with definitions in regulations
under other sections of Title VI, the definitions also included
some that apply only to the regulations promulgated pursuant
to section 611. In describing these definitions, EPA discussed
the legal and policy aspects of the options considered in the
proposal.
With respect to products "manufactured with" ozone-depleting
substances, EPA proposed that a product is "manufactured with"
a class I or class II substance if a class I or class II substance
is used in the product's manufacturing process, including the
manufacture of component parts, but the class I or class II
substance is not contained in the product at the point of sale
to the ultimate consumer. Examples of products "manufactured
with" under the proposed definition included products cleaned
with solvents, products with adhesives or coatings using solvents,
open celled flexible foam products, and certain food and tobacco
products. Excluded from the definition were incidental uses,
those uses where no physical contact occurs between the product
and the controlled substance. Examples of incidental uses provided
in the proposal were are produce stored in a warehouse that
is refrigerated by a CFC system, or clothes that are manufactured
by machinery which requires routine maintenance with a controlled
substance like methyl chloroform, but that the clothes do not
come into contact with the substance directly. Also excluded
from the proposed definition of "manufactured with" were products
manufactured with ozone-depleting substances that are transformed
into non-ozone-depleting substances during the manufacturing
process and therefore do not pose a threat to the ozone layer.
Appendix A of the proposal, parts 1 and 2, consisted of a partial
list of products that were considered "manufactured with" and
those considered "containing."
In the proposal, EPA indicated that it would not narrow its
definition of "manufactured with" through establishment of a
"de minimis" level because though many CFCs and other ozone-
depleting substances were typically used in small quantities
by individual users, the aggregate use of these substances over
an entire market segment was large.
Under the proposal, EPA defined "product containing" ozone-
depleting substances to be products that hold a controlled
substance
within their structure, or that are intended to be charged with
a controlled substance, at the point of sale to the ultimate
consumer, consistent with Appendix B of the Montreal Protocol
on Substances That Deplete the Ozone Layer (UNEP Memo June 21,
1991). (In the Appendix, the Protocol Parties listed "products
containing" controlled substances for purposes of a trade provision
in Article 4 of the Protocol.) Examples cited were truck air
conditioning units, domestic and commercial refrigeration
equipment,
aerosol products and fire extinguishers.
The proposal contained a discussion regarding the appropriate
placement of labels on products. The definition section of the
proposed rule contained definitions of "principal display panel"
(PDP) and "supplemental printed information" which were relevant
to the discussion of label placement. Since section 611 requires
that a label be "clearly legible and conspicuous," EPA proposed
that the label appear on the product or its container/packaging,
whichever the ultimate consumer would view first when making
the purchase. EPA proposed that placement of the label on the
PDP would be one way in which to ensure that the label was "clearly
legible and conspicuous," since it is generally large enough
to accommodate a label and it is usually where the consumer
is likely to look for product information. However, the proposal
also stated that placement of the label on another display panel
that is normally viewed by the consumer at the time of purchase
could also be "clearly legible and conspicuous."
In addition to display panels, the proposal discussed
alternative
label placement for those products that are not normally viewed
at the time of the purchase decision. It suggested that for
such products, manufacturers include the warning statement in
supplemental printed materials. For products that are normally
viewed at the time of the purchase decision, but are irregularly
shaped or small and cannot therefore accommodate a label on
a display panel, the proposed rule indicated that hang tags,
cards, stickers, tape and other options of label placement could
be used for placement of the label.
EPA also proposed that a product be considered to have been
introduced into interstate commerce either at the warehouse
from which the manufacturer releases the product for distribution
or sale, or at the site of U.S. Customs clearance for imported
products. EPA proposed that the warning statement be passed
through the stream of commerce to the ultimate consumer in order
to inform the ultimate consumer of any controlled substances
used and thereby maximize manufacturers' incentive to switch
to substitutes. Specifically, EPA proposed that for products
incorporating other products as components the label information
on the final product include any information regarding use of
controlled substance(s) in the manufacturing of the component
products. EPA indicated that under such requirements, a
manufacturer
could rely on its reasonable belief that the purchased component
products were not manufactured with controlled substances if
a label did not accompany the product and that independent
investigations
through the stream of commerce were unnecessary. Manufacturers
could also employ contractual specifications which would declare
to their suppliers their unwillingness to purchase products
manufactured with any controlled substance.
For manufacturers in need of temporary exemptions from the
labeling requirement (under section 611(e)(5), effective January
1, 2015, that all products containing or manufactured with a
controlled substance must bear a label), EPA proposed a petition
process with specific format and data requirements. Those
manufacturers
that demonstrated, to the satisfaction of the Administrator,
that no alternative substitutes were currently or potentially
available for their specific use of class I substances could
obtain an exemption. The proposed petition process sought to
implement section 611(e)(1), which allows persons to request
EPA to apply the labeling requirements to a product containing
or manufactured with a class II substance earlier than the statute
otherwise provided. The Agency also proposed a petition process
for persons to request an exemption for their products manufactured
with a class I substance. The Agency would have 180 days to
review such petitions.
Also proposed was the application of a permanent label on
products containing class I substances indicating how to recover
the substances. The intent of the additional label was to provide
clarification to servicers of the products and recyclers of
the substances contained in the product to facilitate appropriate
handling. Under section 608, EPA is required to promulgate
regulations
to maximize the recycling of such substances and to reduce
emissions
of such substances to the lowest possible levels.
EPA also requested comments on whether a symbol should accompany
the warning text as a means of more effectively communicating
the intent of the warning statement. However, EPA was concerned
that the cost of such a symbol would outweigh the benefits of
using the symbol. EPA did not propose a symbol.
In developing the rule, the Agency received guidance from
a Subcommittee on Labeling of the Stratospheric Ozone Protection
Advisory Committee (STOPAC) in accordance with the Federal Advisory
Committee Act, 5 U.S.C. App. section 9(c). Additionally, small
"use-sector" groups convened to discuss application of the labeling
requirement throughout various sectors of industry. The Agency
wishes to acknowledge their valuable technical expertise and
assistance in the development of the proposal.
III. Accelerated Phaseout
Based on new scientific evidence developed since the passage
of section 611 and development of the proposed implementing
regulations, the international community, led by the United
States, has agreed to further accelerate the phaseout of already
regulated ozone-depleting substances and control such substances
pursuant to this agreement. Virtually all class I substances
will be phased out in less than three (3) years and some of
those with the highest ozone depletion factors will be phased
out in less than one year. EPA believes that its decisions in
this rulemaking should take into account the significantly
shortened
life span of ozone-depleting substances and the correspondingly
diminished impact labeling would be expected to have. The following
section describes the most recent scientific and international
developments regarding ozone depletion to provide the relevant
context for EPA decisions regarding the labeling rule.
1. New Scientific Data Regarding Ozone Depletion
Significant scientific advances have occurred since the 1989
Protocol assessments. Several subsequent reports since that
time have indicated a more rapid rate of ozone depletion than
previously believed. The most recent Montreal Protocol Scientific
Assessment, issued December 17, 1991, contains information from
ground-based monitoring instruments, as well as from satellite
instruments, from the years 1979-1991. The data indicate
significant
decreases in total-column ozone have occurred in winter, and
for the first time several similar decreases in spring and summer,
in both the northern and southern hemispheres at middle and
high latitudes. The data further show no significant depletion
has occurred in the tropics. TOMS data indicate that for the
period 1979 to 1991, decreases in total ozone at 45 degrees
south latitude ranged between 4.4 percent in the fall to as
much as 6.2 percent in the summer, while depletion at 45 degrees
north latitude ranged between 1.7 percent in the fall to 5.6
percent in the winter. Data from the ground-based Dobson network
confirm these losses in total column ozone during the thirteen-
year period. These findings show almost twice as much depletion
as the average rate measured by the ground-based network over
a twenty-year period. Based on this new data, scientists have
concluded that the ozone in the stratosphere during the 1980s
disappeared at a much faster rate than experienced in the previous
decade.
The recent UNEP Science Assessment also includes new data
on the estimated ozone depletion potentials (ODPs) of ozone-
depleting substances. The assessment places the ODP of methyl
bromide, a chemical previously thought to have an insignificant
effect on stratospheric ozone, at 0.6, with a range of uncertainty
between 0.44-0.69. The Executive Summary of the Assessment states
that, "if the anthropogenic sources of methyl bromide are
significant
and their emissions can be reduced, then each ten percent reduction
in methyl bromide would rapidly result in a decrease in
stratospheric
bromine of 1.5 pptv (parts per trillion by volume), which is
equivalent to a reduction in chlorine of 0.045 to 0.18 ppbv
(parts per billion by volume). This gain is comparable to that
of a three-year acceleration of the scheduled phaseout of the
CFCs." On November 25, 1992, the Parties to the Montreal Protocol
agreed to assign methyl bromide with an ODP of 0.7 and freeze
its production and consumption at 1991 levels. See subsection
4 below in this section for further information regarding this
issue.
On February 3, 1992, NASA released preliminary data acquired
by the ongoing Arctic Airborne Stratospheric Experiment-II (AASE-
II), a series of high-altitude instrument-laden plane flights
over the northern hemisphere (see Interim Findings: Second Airborne
Arctic Stratospheric Expedition). Additional data were also
obtained from the initial observations by NASA's Upper Atmosphere
Research Satellite (UARS), launched in September 1991. The
measurements
show higher levels of chlorine monoxide (ClO) (the key agent
responsible for stratospheric ozone depletion) over Canada and
New England than were observed during any previous series of
aircraft flights. In fact, the ClO levels over the United States
and Canada and as far south as the Caribbean were many times
greater than gas phase models had predicted. These levels are
only partially explainable by enhanced aerosol surface reactions
due to emissions from the volcanic eruptions of Mount Pinatubo.
The expedition also found that the levels of hydrogen chloride
(HCl), a chemical species that stores atmospheric chlorine,
to be low, providing new evidence for the existence of chemical
processes that convert stable forms of chlorine into
ozone-destroying
species. The Montreal Protocol Scientific Assessment document
includes studies on the Antarctic ozone hole which implicate
chlorine as the main cause of ozone depletion over the Antarctic,
and link high chlorine concentrations to CFCs and other chlorinated
and brominated compounds. The high ClO and bromine monoxide
(BrO) levels observed in these studies indicate that human-induced
rates of ozone destruction were as high as one to two percent
per day for short periods of time beginning in late January.
In addition, the levels of nitrogen oxides (NOx) were also
observed to be low, providing evidence of reactions that take
place on the surface of aerosols that diminish the ability of
the atmosphere to control the buildup of chlorine radicals.
New observations of HCl and nitrogen oxide (NO) imply that chlorine
and bromine are more effective in destroying ozone than previously
believed.
The NASA findings indicate that in late January of 1992,
the Arctic air was chemically "primed" for the potential formation
of a springtime ozone "hole" similar to that formed each spring
over Antarctica. These findings also are consistent with theories
that ozone depletion may occur at an accelerated rate on aerosol
surfaces in the stratosphere anywhere around the globe, and
not only on polar stratospheric clouds as was previously believed.
After collecting more data, NASA released an April 30, 1992
"End of Mission Statement," which indicated that while a rise
in stratospheric temperatures in late January apparently prevented
severe ozone depletion from occurring in the Arctic this year,
observed ozone levels were nonetheless lower than had previously
been recorded for this time of year. This information has further
increased the Agency's concern that significant ozone loss may
occur over populated regions of the earth, thus exposing humans,
plants and animals to harmful levels of UV-B radiation, and
adds support to the need for further efforts to limit emissions
of anthropogenic chlorine and bromine.
In response to these findings, President Bush announced on
February 11, 1992, that the United States would unilaterally
accelerate the phaseout schedule for ozone-depleting substances,
and he called upon other nations to agree to an accelerated
phaseout schedule as well. The President also asked U.S. producers
to voluntarily reduce 1992 output of class I substances to half
of the 1986 baseline levels. In addition, the President directed
EPA to re-evaluate the phaseout schedule for HCFCs, and to consider
the phaseout of methyl bromide.
The Agency has also received two petitions to accelerate
the phaseout of these chemicals. One petition was submitted
by three environmental groups, the Natural Resources Defense
Council (NRDC), the Environmental Defense Fund (EDF), and Friends
of the Earth (FOE). This petition further requested that EPA
add methyl bromide to the list of class I substances. The other
petition was submitted by the Alliance for Responsible CFC Policy,
an industry group of producers and users of the chemicals.
2. Copenhagen Revisions to the Montreal Protocol
On November 25, 1992, the Fourth Meeting of the Montreal
Protocol was convened.
In this meeting, the Parties took a number of actions, including
accelerating the phaseout schedule of CFCs, halons, carbon
tetrachloride,
and methyl chloroform and added HCFCs and methyl bromide to
the list of chemicals to be controlled under the Montreal Protocol.
The following changes to the previously proposed phaseout
schedules were reached at the Copenhagen meeting:
(1) Adjusting the phaseout schedule for CFCs (class I, group
I substances) to a 75% reduction in production and consumption
(production plus imports minus exports) from 1986 baseline levels
for 1994 and 1995, and a complete phaseout by 1996;
(2) Adjusting the schedule for Halons (class I, group II
substances) to a complete phaseout in production and consumption
by 1994:
(3) Adjusting the phaseout schedule for other fully halogenated
CFCs (class I, group III substances) to a reduction from 1989
levels, 75% in 1994 and 1995, and a complete phaseout of production
and consumption by 1996;
(4) Phasing out of carbon tetrachloride (class I, group IV)
by a reduction from 1989 levels of 85% in 1995, and a complete
phaseout in 1996;
(5) Adjusting the phaseout schedule for methyl chloroform
(class I, group V) by reducing the production and consumption
of 1989 levels by 50% in 1994, and phasing out completely by
1996.
(6) Establishing criteria for identifying essential uses
and a process for excepting limited production and consumption
of the above chemicals following their phaseout (see below).
These adjustments go into effect in approximately six months.
In addition, the Parties adopted the following amendments to
the Protocol:
(1) Freezing consumption of HCFCs (class II substances)
beginning
in 1996 to a baseline ceiling of: 100% of 1989 the ozone depletion
potential (ODP) weighted level of HCFC consumption plus 3.1%
of the ODP weighted 1989 CFC 2004, 65% by 2010, 90% by 2015,
and 99.5% by 2020; and completely phasing out consumption by
2030;
(2) Adding Hydrobromoflourocarbons (HBFCs) to the list of
class II controlled substances, specifying their ozone depletion
potential, and phasing their consumption out completely by 1996;
(3) Listing methyl bromide as a controlled substance with
an ozone depletion potential of 0.7, and freezing consumption
beginning in 1995 to 1991 consumption levels; (the calculated
levels of consumption shall not include quarantine and preshipment
uses);
(4) Establishing a procedure for the approval by the Parties
for continued production and consumption after phaseout to meet
essential use requirements; essential uses are defined as those
necessary for health or safety, or critical to the functioning
of society, and where there are no available alternatives or
existing stocks of banked or recycled material;
(5) Establishing reporting requirements for HCFCs, HBFCs,
and methyl bromide;
(6) Establishing reporting requirements for imports and exports
of controlled substances to and from non-parties to the Protocol;
The Amendments will enter into force under the Protocol
following
their ratification by at least twenty Parties. This is projected
to be accomplished by January 1, 1994.
The Parties also made a number of procedural and definitional
changes that affect implementation of the Protocol and that
are included in the proposed accelerated phaseout regulation.
The changes include:
(1) The approval of destruction technologies and the requirement
that Parties that plan to operate destruction facilities do
so in accordance with Good Housekeeping Procedures developed
by the Parties or their equivalent;
(2) Clarification of the definition of controlled substances
to exclude insignificant quantities under defined circumstances,
and to encourage Parties to minimize emissions of such substances;
(3) Clarification of the reporting requirements and treatment
of international transshipment;
(4) Modification of definition of controlled substance to
exclude import and export of recycled and used controlled
substances
from the calculation of consumption, but to require reporting
of data concerning these imports and exports.
The Parties also adopted a procedure under which the Parties
can approve the continued production and consumption of ozone-
depleting substances after the phaseout to meet essential uses.
Such uses are defined as necessary for health, safety, or critical
to the functioning of society, but are to be permitted only
in cases when no alternatives exist or when existing stocks
of banked or recycled material are not available. The definition
of "controlled substance" was also clarified to exclude
insignificant
quantities resulting from inadvertent production and unreacted
feedstock.
3. The Proposed Accelerated Phaseout Regulation
In July 1992, EPA issued its final rule and regulatory program
implementing section 604 of the Clean Air Act Amendments. The
section limits the production and consumption of ozone-depleting
chemicals. EPA controls production and consumption by issuing
allowances or permits that are expended in the production or
importation of these chemicals. Trading of these allowances
is permitted.
The regulation requires producers of class I substances to
gradually reduce their production of these chemicals and to
phase them out completely as of January 1, 2000 (2002 for methyl
chloroform). In addition to the production limits, the rule
requires a similar reduction in consumption.
In February 1992, the President requested that U.S. producers
voluntarily reduce their production by half of the baseline
year levels. He also announced that the U.S. would revisit the
phaseout schedule for HCFCs and progress towards an accelerated
phaseout of class I substances from 2000 to the end of 1995.
At the same time, EPA received a petition from the Natural
Resources Defence Council (NRDC), the Environmental Defense
Fund (EDF) and Friends of the Earth (FOE), requesting that EPA
add methyl bromide to the list of class I substances. Another
petition was submitted by the Alliance for Responsible CFC Policy.
The Fourth Meeting of the Parties to the Protocol, discussed
above, further supported the movement towards an agreed upon
accelerated phaseout by the Parties.
Based on these new developments, EPA is proposing to accelerate
the phaseout of CFCs, methyl chloroform, carbon tetrachloride,
halons, HCFC-141b, HCFC-142b, and HCFC-22. The Agency is also
proposing to add methyl bromide and HBFCs to the list of major
class I substances. In addition to these new listings, the proposal
implements various trade provisions required by the Montreal
Protocol to encourage countries to join the Protocol by prohibiting
the trade of bulk substances and products containing controlled
substances with non-parties.
4. Effect of Accelerated Phaseout on the Labeling Regulation
The accelerated phaseout will have a significant impact upon
manufacturing processes that use class I substances affected
by today's rulemaking. The combined effects of the excise tax
and the original phaseout schedule have already created strong
economic incentives for industry to find substitutes for class
I substances. In fact, according to EPA's database on producers
of these chemicals, current U.S. production of CFCs are about
50 percent below the 1986 baseline levels set by the Montreal
Protocol. The accelerated phaseout will significantly increase
the economic incentives for all class I substance users to switch
to alternatives. Consequently, even where a particular process
that uses a class I substance is exempted from the labeling
requirement through the petition process outlined below, the
substance in question will rapidly become scarce and expensive,
and industry will be encouraged to find alternative chemicals
or processes.
When Congress passed the Clean Air Act Amendments of 1990,
it required the production and consumption of class I substances
to be phased out by the year 2000 (2002 for methyl chloroform
(MCF)) and warning labels to be applied to containers containing
class I and class II substances, and products containing and
manufactured with class I substances beginning on May 15, 1993.
The section 611 labeling provisions related to class I substances
thus had six and a half years (eight and a half years for MCF)
to have an effect on the use of class I substances before they
were phased out. However, the decision to end production of
class I substances by January 1, 1996 (January 1, 1994 in the
case of halons) means that the labeling of products manufactured
with class I substances per section 611(d) and products containing
and containers containing class I substances per section 611(b)
will be in effect for less than three years before the complete
phaseout takes effect. As a result, EPA has streamlined some
of the proposed requirements related to class I substances in
recognition that manufacturers will be phasing out their uses
of these substances at a much earlier date. This is further
addressed below in the Response to Significant Comments section
(V).
IV. Summary of Public Participation
A hearing on the proposed labeling rule was held on May 18,
1992. Nine groups presented oral comments to the proposed
requirements
and submitted written testimony to the Agency. A transcript
of the testimony is contained in the public, No. A-91-60.
The Agency received a total of 162 comments on the proposed
rule. Six commenters supported the proposal that labels supply
ultimate consumers with information at the point of purchase
decision. Other commenters recognized the impact that labeling
will have as a market incentive for elimination of class I
substances
and in the development of alternative substances and processes
that use such substances.
Many comments addressed EPA's proposal that manufacturers
that do not manufacture with a process using a class I substance,
but use component products which were manufactured using a class
I substance, would have to label their products (the "pass-through
requirement"). Commenters requested that EPA consider the
significant
financial and administrative burden on manufacturers who may
have well over 1,500 suppliers of components. Many commenters
also addressed the issue of products manufactured and stored
in inventory prior to the effective date of the rule. Commenters
stated that the burden of pulling back all such products from
inventories, warehouses, distributors and retailers for purposes
of applying a label would be an onerous task with little, if
any, environmental benefit. The issue of products manufactured
for export only was discussed by many commenters who were concerned
that U.S. manufacturers would be at an economic disadvantage
in a global market if American-made products for export were
required to bear a warning statement, because other countries
do not have similar requirements.
Other comments addressed the use of a symbol with the warning
statement. Most commenters argued against the symbol, indicating
that it could distract consumers from the warning statement
itself, as well as from other important information on a product's
label. Another issue raised frequently in comments concerned
the recoverable substances label. Many commenters did not support
the label since section 608 covers such products containing
recoverable substances and promotes training for servicers handling
and disposing of such substances. Many commenters requested
clarification of the alternative label placement options. They
indicated that there was no clear distinction among the proposed
options. Finally, the Agency received numerous comments regarding
the definition of incidental uses of class I substances and
the need for a de minimis exemption.
EPA addresses the significant comments that it received in
section V. below. EPA addresses other comments received in a
separate Response to Comments document available in the docket.
V. Response to Significant Comments
A. Definition of Interstate Commerce and Introduction Into
Interstate
Commerce
Some of the commenters indicated that EPA should include
a definition of interstate commerce in the final rule and specify
at which point a product enters into interstate commerce. EPA
defines interstate commerce as the distribution or transportation
of any product or container between one state, territory,
possession
or the District of Columbia and another state, territory,
possession,
or the District of Columbia. It is further defined as the sale,
use or manufacture of any product in more than one state,
territory,
possession or the District of Columbia. For a product or container
in the United States to avoid coverage as being in intrastate
commerce, an affected party must provide adequate documentation
that the product not only was or will be manufactured, distributed,
sold or used without ever crossing state lines, but that none
of the components that went into, or will go into, the manufacture,
distribution, sale or use of such product originated, or will
originate, in another state.
A product is first introduced into interstate commerce either
when it is released from the facility in which it was manufactured,
when it enters the warehouse from which a domestic manufacturer
releases the product or container for shipment, or for imported
products, when they are at the site of U.S. Customs clearance.
The inclusion of the facility in which a product was manufactured
as a point of introduction responds to comments indicating that
some manufacturers do not inventory their products, but sell
them directly to separate warehouse facilities. In this case,
the manufacturer of the product is required to apply the label
before the product leaves its facility. A manufacturer that
stores its product in its own warehouse introduces that product
into interstate commerce when the product enters its warehouse.
The manufacturer in this case is required to apply the label
prior to or contemporaneous with, the product's entrance into
the warehouse. This provision differs from the proposal in that
the introduction of a product into interstate commerce occurs
when the product enters the warehouse, not when the product
leaves the warehouse. As discussed below in part V.B., several
commenters stated that manufacturers often store products at
warehouses for extended periods of time before the products
finally leave the warehouse. This change to the regulation will
ease enforcement by requiring that all products that are stored
in warehouses be labeled by the time they enter storage. This
revision also allows manufacturers to avoid having to label
products manufactured prior to May 15, 1993 but still in inventory
on that date.
Containers containing ozone-depleting substances become subject
to these regulations at the time they are charged with an ozone-
depleting substance. At the point of charge, they are defined
as containers containing ozone-depleting substances which have
been introduced into interstate commerce. Application of a warning
statement therefore would be required upon completion of the
charging activity.
B. Products Manufactured Before May 15, 1993
Many commenters addressed the impact of the labeling rule
on products in inventory and in production up until the effective
date. The commenters all expressed concern that requiring a
label on products that were manufactured before the effective
date, but are still in the manufacturer's inventory as of the
effective date, would impose significant economic and logistic
burdens on the affected manufacturers, distributors, wholesalers
and retailers. Consequently, the commenters argued that EPA
should not require a label on products manufactured before May
15, 1993, even if the products have not left the warehouse from
where the manufacturer releases the product for distribution
or sale. Some comments indicated that EPA should allow a grace
period for those products that are manufactured and warehoused
prior to the effective date, if an exemption of such products
from labeling altogether is not possible.
EPA agrees with these commenters that requiring a label on
products already manufactured prior to the effective date would
adversely affect a number of businesses without providing any
appreciable environmental benefits. There are many manufacturers
that maintain large stocks of products to support high or
conditional
consumer demand. If EPA were to apply these regulations to such
products, manufacturers would be required to retain those products,
remove their packaging in order to label them appropriately,
and resume normal commercial distribution. An additional problem
for some products is that the stream of commerce for such products
is strictly regulated (e.g., limited shelf life of metered dose
inhalers) in which case any deviation from a product's regulated
commercial mobility would require regulatory complications and
delays in the distribution of such products. Other manufacturers
may have products stored in warehouses across the United States
and on foreign territory, in which case labeling such products
according to the proposed requirements would require significant
time and expense. One major electronics company indicated that
it currently has approximately 2,500 suppliers world-wide and
purchases about 70,000 component products from these suppliers.
For this company, labeling all of its inventoried products prior
to the effective date would involve tremendous costs and time.
In addition, manufacturing processes for many products manufactured
with class I substances prior to May 15, 1993 would have already
released the substance during manufacture except for those
processes
where recovery and recycling occur. Therefore, the final product
poses no further threat to the stratospheric ozone layer when
it is inventoried or later sold.
EPA believes that its clarification of the term "introduction
into interstate commerce" (see section V.A.) should ease most
of the concern of commenters on this point. If a product has
been introduced into interstate commerce before May 15, 1993,
then it is not subject to these regulations. Only a small number
of products will have been manufactured before May 15, 1993
but will not have left the facility of manufacture or have entered
the manufacturer's warehouse by the effective date. Therefore,
for the vast majority of products manufactured before May 15,
1993, the rulemaking is inapplicable on its face, given EPA's
definition of the term "introduction into interstate commerce."
For those small number of products that are manufactured
before May 15, 1993, but which have not left the place of
manufacture
or have not entered the manufacturer's warehouse before May
15, 1993, or that are manufactured in foreign countries before
May 15, 1993, EPA is allowing such products to be "grandfathered."
EPA believes that requiring manufacturers to label these products
would adversely affect numerous businesses, because the labeling
process for many manufacturers occurs during the actual
manufacturing
process. Thus, if EPA did not grandfather these products,
manufacturers
would have to undergo a onetime cost to retrieve and label products
already manufactured but not yet introduced into interstate
commerce before May 15, 1993. EPA believes that little if any
appreciable environmental benefits would be gained from requiring
such products to be labeled.
EPA believes that sufficient precedent exists for this decision.
The United States Court of Appeals for the District of Columbia
Circuit has established a four-part test to judge the
appropriateness
of Agency grandfathering (see Sierra Club v. EPA, 719 F.2d 436
(D.C. Cir. 1983)). This test involves balancing the result of
four analyses, including whether the new rule represents an
abrupt departure from previously established practice, the extent
to which a party relied on the previous rule, the degree of
burden that application of the new rule would impose on the
regulated parties, and the statutory interest in applying the
new rule immediately.
EPA believes that the labeling requirements represent an
abrupt departure from previous practice. Prior to the effective
date of the labeling requirements, manufacturers in general
were not required to provide any labeling information regarding
whether controlled substances were contained in, or used in
the manufacture of, a product; moreover, until today's publication
of these regulations, manufacturers could not know for certain
the specific labeling provisions that they would be required
to implement. As discussed above, requiring labeling on products
manufactured before May 15, 1993 would impose an unreasonable
burden on numerous affected parties while providing no significant
environmental benefits. For these reasons, EPA believes that
its grandfathering of products manufactured before May 15, 1993
is consistent with the requirements of Sierra Club v. EPA.
Today's final rule also provides for grandfathering products
containing class I or class II substances. Such products face
problems like these described above for products "manufactured
with," in that they can be stored for distribution throughout
the world. To require them to be labeled before distribution
in order to apply the warning statement would result in significant
costs with little or no environmental benefit.
Therefore, given the large onetime cost to label inventoried
products, and limited environmental benefit of labeling these
products, this regulation provides that all products manufactured
before May 15, 1993 are not subject to the requirements of section
611(d). This decision is also based on the fact that industry
will have significantly less time to implement the labeling
requirement than the statute envisioned because the Agency did
not promulgate implementing regulations within eighteen months
following enactment of the Act's amendments, as required by
the statute. Had EPA promulgated such regulation at the proper
time, manufacturers would have had one year from the time of
publication of the regulation to the law's effective date to
comply. Because of these delays, manufacturers have substantially
less time to comply after the promulgation of these regulations.
Therefore, EPA acknowledges the difficulty that manufacturers
with inventories of products would have without such a
"grandfathering"
exemption.
EPA is requiring that for products manufactured before the
effective date to be exempt from the labeling requirement,
manufacturers
must be able to show within twenty-four (24) hours of receiving
a request by EPA that such products were manufactured prior
to May 15, 1993. Although EPA is not requiring new recordkeeping
requirements or specific tracking systems today, manufacturers
must have an accountable system in place on site so that EPA
can verify that unlabeled products were manufactured or containers
were filled prior to the effective date. The burden thus falls
upon the manufacturer to show that unlabeled products are exempt
from the labeling provision. If a manufacturer is unable to
verify such information, then that person will be deemed out
of compliance and subject to penalties, pursuant to Title I,
section 113 of the Clean Air Act. Importers of products that
can show at the site of U.S. Customs (Customs) clearance that
such products were manufactured prior to the effective date
are also exempted from the labeling requirement. In the absence
of such proof, products containing or manufactured with a class
I substance will need to bear the appropriate label, regardless
of the manufacture date.
C. Products Manufactured With Controlled Substances{1}
³{1} This labeling regulation applies to products
manufactured
³with class I and class II substances. However, it
should
³be noted that products manufactured with class II
substances
³are not regulated by this regulation until January 1,
³2015, or until the Administrator finds, after notice
³and opportunity for comment, that for a particular
product
³substitute products or processes are potentially or
currently
³available.
1. Changes to the Label Pass-Through Requirement
In the proposed rule, EPA required that products manufactured
with and containing controlled substances be labeled throughout
the stream of commerce. Its definition of "manufactured with"
exempted transformation and non-contact uses of controlled
substances.
The proposal indicated that by allowing these exemptions, the
requirements would not result in universal labeling. Additionally,
EPA indicated that the labeling requirements should apply across
all use sectors since Congress did not restrict applicability
of the law.
EPA further proposed that in order to inform the ultimate
consumer that a controlled substance had been used in the
manufacture
of any part of a finished product, any manufacturer that
incorporates
a labeled component into its product, would be required to label
its product, even if no ozone-depleting substances are used
by the manufacturer in the subsequent manufacturing process.
EPA stated in the proposal that manufacturers could rely on
the label information they received from their suppliers, as
long as they reasonably believed that the information was accurate.
EPA suggested that manufacturers could show reasonable belief
by using contract provisions requiring accurate labeling by
their suppliers.
One commenter supported EPA's definition of "manufactured
with," stating that it would not necessarily culminate in universal
labeling, and that EPA's proposal to pass the label through
the stream of commerce to the ultimate consumer is fair and
appropriate, as long as there are clear penalties to discourage
noncompliance. However, many responded that EPA's proposed
definition
of "manufactured with" was extremely broad, covering a significant
number of products, including component products, and that such
a requirement would in fact result in universal labeling with
an onerous and expensive tracking burden. These commenters argued
that tracking components was unavoidable and that all products
would have to be labeled. Such universal labeling, it was argued,
would reduce the effectiveness of the requirement, with little
environmental benefit and possible confusion for consumers.
Other comments expressed doubt as to whether the proposal reflected
congressional intent.
Several also commented that the proposal would disadvantage
downstream manufacturers that do not use controlled substances
in their own manufacturing processes, but that depend upon a
multitude of suppliers who may use controlled substances in
their manufacturing processes.
According to these commenters some manufacturers may have
more than 1,500 suppliers for a given manufacturing process.
As a result, tracking the source of supply, determining whether
that source used a controlled substance, and determining whether
that source's component was used in a specific final product,
could be extremely difficult and prohibitively costly to implement.
As discussed below, the commenters also stated that manufacturers
cannot use contract provisions to ensure accurate labeling for
all their components.
The difficulties in tracking the use of controlled substances
throughout the stream of commerce are illustrated by the case
of a major electronics manufacturer. This firm purchases about
70,000 component products from about 2,500 domestic and foreign
suppliers. The company has phased out completely its use of
class I substances in its own manufacturing processes, but because
it buys from suppliers it must determine and track their use
of class I substances. To do so, it has undertaken an outreach
program to learn the extent to which class I substances are
being used throughout its supply chain. The company contends,
however, that surveys, letters, follow-up letters, data entry
of the information received, data analysis and subsequent outreach
to those vendors using class I substances are time-consuming
and cannot assume the degree of certainty required by the approach
outlined in the proposal.
Tracking is made more difficult by the fact that many products,
especially electronic products, are comprised of thousands of
components that may come into contact with ozone-depleting
substances.
Therefore, a manufacturer would have to label its products unless
it has a reasonable belief that all of its component products
in a final product were not manufactured with ozone-depleting
substances. Moreover, as the proposed warning statement would
have to list every controlled substance used by any manufacturer's
suppliers, a manufacturer would have to have a reasonable belief
regarding the uses of controlled substances by any of its
suppliers.
The company discussed above learned that tracking by their
suppliers
of their uses of class I substances was very poor overall. Of
its 2,500 world-wide suppliers, only one was found to have an
outreach program that targeted more than one level of suppliers.
Therefore, it would be extremely difficult for this manufacturer
to be reasonably confident that the products it purchases are
free of ozone-depleting substances, because the vendors throughout
its supply chain lack the necessary information about their
own products, as well as the components that they purchase from
their suppliers. In addition, regulations vary among countries
and tracking of class I substance use abroad is poor. Thus,
many commenters stated that it would be impossible to be reasonably
confident that a purchased product does not require a warning
statement. According to commenters, this would lead to universal
labeling of all final products in several industries, especially
the electronics industry. Universal labeling, these commenters
agreed, would not fulfill the intent of the law, since ultimate
consumers would be unable to distinguish among any of these
products on the basis of controlled substance use.
While the proposed rule did not require a company to conduct
independent investigations throughout its stream of commerce
in order to form a reasonable belief, subsequent to the proposal,
many manufacturers and their suppliers initiated such
investigations
in order to be assured that their final products did not require
the warning statement. Several commenters stated that a
manufacturer
must perform investigations in order to satisfy the reasonable
belief requirement that their suppliers are accurately labeling.
They explained that EPA's suggestion that contract provisions
be used to establish a reasonable belief was not practical.
As discussed above, many products rely on numerous parts
manufactured
by many suppliers and that revisions of all the contracts involved,
where they exist, would be an enormous undertaking. These
commenters
indicated that many of the components incorporated into their
products are purchased without contracts. Such products are
either purchased "off the shelf" or from various suppliers at
different times, depending on one's inventory and the market
situation. These commenters stated that they cannot control
the manufacturing processes of these products through contract
specification provisions. Thus, aside from using independent
investigations, manufacturers have no way of ensuring that
component
manufacturers are not using ozone-depleting substances or are
accurately labeling their products.
Commenters further explain that the problem is further
exacerbated
by the fact that many components are purchased with little lead
time between purchase and incorporation into a new product.
As a result, the packaging information for the final product,
including any labeling information, is often completed before
the components are purchased. Under such circumstances it is
impossible for manufacturers to know whether to label the package.
If EPA requires labeling of a product based on a component
manufacturer's
use of ozone-depleting substances, then the manufacturer of
the final product may have to expend significant costs to
restructure
its packaging and labeling processes in order to account for
incorporation of last minute information.
It is evident to EPA that given the difficulty of tracking
the use of controlled substances throughout the stream of commerce,
the "reasonable belief" provision as proposed was too vague
to define or determine liability and was therefore unworkable.
For products manufactured with controlled substances, EPA
has given considerable thought to the concerns raised in the
comments on passing labels through the stream of commerce. As
a result, EPA is revising its definition of "manufactured with"
to state that a product is "manufactured with" an ozone-depleting
substance if the manufacturer of the product itself used an
ozone-depleting substance in manufacturing that product. Thus,
the inclusion of component products manufactured using controlled
substances in the manufacture of another product, that does
not otherwise involve the use of controlled substances does
not constitute "manufacturing with an ozone-depleting substance."
Each item manufactured and introduced into interstate commerce
is considered a product, necessitating a label if manufactured
with a controlled substance. The incorporation of that product
into another, however, does not necessitate a label.
EPA believes that the revision to the label pass-through
requirement for products "manufactured with" ozone-depleting
substances is consistent with the statute. EPA believes that
the phrase "manufactured with a process that uses" an ozone-
depleting substance can reasonably be interpreted to refer only
to the manufacturing process of the company that introduces
the product into commerce and not also to the manufacturing
of any component parts made by another company. Thus, a product
"manufactured with a process that uses" an ozone-depleting
substance
means only a product that was manufactured using such substances
by the company that introduces the product into commerce (i.e.,
the manufacturer of the final product). To illustrate, a television
would be a product manufactured with a process using
ozone-depleting
substances only if the manufacturer of the final product used
such substances in its manufacturing process. Use of component
parts made by a supplier using ozone-depleting substances would
not constitute "manufacturing with a process" using those
substances.
Thus, the television would have to be labeled only if that company
that introduces it into commerce itself used ozone-depleting
substances to make the television. The component parts, on the
other hand, would be products "manufactured with a process using
ozone-depleting substances" since their supplier made them using
ozone-depleting substances in its manufacturing process. The
labeling requirement would accordingly apply to the component
parts, but the label would not have to be incorporated by the
manufacturer of the final product.
Section 611 does not define "products manufactured with a
process that uses" ozone-depleting substances. EPA believes
that the approach it implicitly took to the phrase in its proposed
rule is consistent with, but not compelled by, the statute.
As a conceptual matter, it would advance the purpose of the
labeling provision to require that any product be labeled through
the stream of commerce so long as any part of it, no matter
how small a fraction of the whole, was made using ozone-depleting
substances. However, to the extent that such a requirement proved
unworkable and resulted in inaccurate information, it could
actually undermine the integrity and thus the effectiveness
of the labeling program.
The purpose of the labeling provision is also served if the
buyer of any product is made aware of whether the product's
maker itself used ozone-depleting substances. Under the definition
described above, wherever in the stream of commerce class I
or class II substances are used, the buyer at the next point
in the stream of commerce would be made aware of their use.
While this approach would result in many labels reaching only
other manufacturers, EPA believes that many manufacturers can
be expected to have an incentive at least as great as that of
downstream consumers to respond to the warning statement.
Manufacturers
that rely on component parts made by other companies can ill
afford to rely on suppliers to use alternative substances or
find other suppliers that do. Thus, labels attached to products
as defined above would promote the switch to substitutes that
Congress sought to encourage through the labeling provision.
While labeling products through the stream of commerce could
add to the incentive effect of the program, EPA is persuaded
by the comments summarized above that the proposed pass-through
requirement is impracticable and would probably not result in
accurate information reaching the retail consumers. The proposed
"reasonable belief" standard for determining whether to label
would also be difficult to enforce.
In addition, the recent decision of the Protocol Parties
to significantly accelerate the phaseout of the listed ozone-
depleting substances (a decision which EPA must implement under
section 606(a)(3) of the CAA) reduces the importance of the
labeling program. Congress enacted section 611 when class I
substances were expected to be phased out by the year 2000.
The labeling requirement thus provided an incentive for
manufacturers
to move away from their use of such substances before 2000 in
order to avoid the negative market reaction. With the acceleration
of the phaseout to 1996 for most class I substances (and 1994
for others), requiring products to be labeled is unlikely to
significantly add to manufacturers' incentive to switch to
alternative
substances.
In light of the substantial burden and questionable
effectiveness
of the proposed pass-through requirement, EPA is not requiring
it in today's rule for products manufactured with controlled
substances. The Agency is instead adopting the definition of
"products manufactured using" ozone-depleting substances described
above so that a manufacturer need only label its product if
the manufacturer itself used ozone-depleting substances in
producing
it.
For the purpose of applying the definition described above,
divisions of a company, wholly-owned subsidiaries and parent
corporations are considered to be a single manufacturer. Therefore,
where one division of a company, for example, incorporates a
component manufactured with an ozone-depleting substance and
that component was manufactured by another division of the same
company, the final product must contain a warning statement
upon its introduction into interstate commerce, even where the
product may be finished by other divisions without the use of
ozone-depleting substances. If a manufacturing process of a
product takes place in more than one facility, the label
information
must accompany the product, but not necessarily in the form
of a label. Upon the final point of manufacture, a label must
then be applied. EPA believes that this will facilitate the
labeling process and reduce the burden in the overall manufacturing
process of a product where the process involves more than one
site of operation.
EPA believes that the tracking problems associated with the
pass-through requirement are to a great extent eliminated if
manufacturers are only required to track the use of ozone-depleting
substances by the divisions within a subsidiary of the same
company.
In contrast to manufacturers that use a component manufactured
with a controlled substance, the rule promulgated today prohibits
distributors, wholesalers and retailers that receive a product
with a label indicating that it was manufactured with a process
that uses a controlled substance from removing the label. They
must leave the label on a product they purchase or distribute,
including products they re-package,{2} and are subject to
penalties.
Since the purpose of the labeling program would obviously be
frustrated if labels could be removed by downstream sellers,
EPA is exercising its authority under section 301 of the CAA
to establish the prohibitions described above.
³{2} EPA considers the assembly of component products
³to be a manufacturing process only when the assembly
³creates an entirely new product. Manufacturers,
distributors,
³wholesalers and retailers that simply repackage a
product
³and/or do not substantially change it, are not
manufacturing
³a product and must pass the warning statement through
³the stream of commerce.
Rules governing labeling by importers also differ from the
general rules described above. Importers must have a "reasonable
belief" that a "product manufactured" or "product containing"
does not require a label at the time it enters the site of U.S.
Customs clearance, or its introduction into interstate commerce.
With no similar labeling requirements abroad, foreign manufacturers
will not likely impart the information required of domestic
products without an inquiry made by the U.S. importer of record.
It is therefore the responsibility of the importer to investigate
at least one step back into the manufacturing process of the
product to determine whether it is manufactured with a class
I substance. An importer may use specifications in its contracts
with its suppliers under which the suppliers are required to
certify whether the product being exported to the United States
was or was not manufactured using a controlled substance, in
order to show that the importer has a reasonable belief that
the product was not manufactured using controlled substances.
Importers are not required to investigate whether a component
incorporated into the product they are importing was manufactured
with a class I substance.
a. Resin producers and the use of one label. One commenter,
noting the difficulty and cost of determining which class I
substances are used in the manufacturing process of a product,
stated that resin producers who purchase one or more pigments
manufactured with class I substances would have great difficulty
in determining which and how many class I substances were used
in the manufacturing process of the pigments. The commenter
noted that several different labels for the same type of products
would be required as a result. It suggested that EPA's final
regulation enable resin producers to forego labeling since they
do not use the class I substances themselves and would be unable
to determine how many and which ones were used in the manufacturing
of the pigments.
Under the definition of product "manufactured with" being
adopted today, EPA would not require resin producers to label
if they, in fact, do not use a controlled substance in their
manufacturing process. If they do use such substances, they
would be required to label their products. The label would have
to list substances used in the producer's own manufacturing
process. One label listing the substances by their standard
chemical names could be used instead of multiple labels for
a single product. EPA believes that by dropping the pass-through
requirement for products manufactured with controlled substances,
it is addressing the issue of liability for all manufacturers
concerned with products they purchase upstream.
2. Incidental Uses
Many commenters supported EPA's determination in the proposed
rulemaking that incidental uses of controlled substances should
not trigger the labeling requirement. However, commenters argued
that EPA's definition of incidental use was too narrow and should
include "contact" incidental use as well. Some of the uses of
controlled substances that commenters sought exemptions for
as an "incidental use" were the following: use as reactive atoms
that are not integral to the manufacturing process; use in making
food packaging; use as incidental additives such as those found
in the manufacturing of spices which are then added to other
foods; use as cleaners of plates used to print product information
and labels; use to clean reaction vessels in the manufacture
of silicone products; use as degreasers in the production of
industrial diamonds; and use as mold release agents used to
prevent the adhesion of products to a mold. Other commenters
recommended that EPA include "non-routine" and "unintentional
physical contact" situations as incidental uses.
In the final rule, EPA expands incidental uses to include
"contact" uses in which a class I or class II substance is used
intermittently, on a non-routine basis, and not as an integral
part of the manufacturing process of the product. Some examples
would be an intermittent application of a controlled substance,
such as methyl chloroform as a spot cleaner for textiles, or
an occasional cleaning of an ink plate with a solvent as part
of routine maintenance, as long as the use is not a part of
the manufacturing process itself. Another example would be the
infrequent performance of leak detection tests on a cooling
system and condenser, using CFCs or substances containing CFCs.
EPA believes that such incidental "contact" uses, though they
potentially could involve a brief initial physical contact between
the controlled substance and the product, occur so infrequently
(e.g., typically as part of the maintenance process), that labeling
would not be appropriate. This exemption would also likely cover
most situations where a physical contact occurred unintentionally.
In contrast, mold release agents that are applied on a regular
and systematic basis in a manufacture process would not be
considered
an incidental use of a class I substance. Further, the defluxing
of printed circuit boards during a continuous production process
would not be considered an incidental use. EPA also cannot exempt
food processing applications in which a spice, for example,
is manufactured with a controlled substance. However, where
foods are prepared with such spices, such foods are not required
to bear a label, based on the definition of a product "manufactured
with" discussed above. Again, products that incorporate other
products which were manufactured with controlled substances
are not required to pass through the label unless both sets
of products were manufactured by the same company.
One commenter argued that plasma etching in the manufacturing
process of semiconductors is an incidental use of controlled
substances. (Plasma etching uses controlled substances in a
sealed chamber in which radio frequency energy is applied to
excite the chemicals and break them down to create an "ion-plasma."
The plasma is used to etch certain parts of a silicon wafer
upon which semiconductors are created.) The manufacturer states
that the use of a controlled substance to supply ions to the
plasma is terminated once the chemicals are "broken down" in
the sealed chamber. Another commenter indicated that a direct
contact use that is closed-loop (the controlled substance is
not emitted and/or destroyed) or employs recovery and recycling
systems should be considered an incidental use. Finally, another
commented that use of methyl chloroform as a solvent carrier
which eventually evaporates (except for trace quantities) should
be considered as an incidental use.
EPA does not consider the use of controlled substances in
the process of plasma etching an incidental use since the
controlled
substances are integral to that process. However, as plasma
etching falls under the transformation exemption discussed below,
products involving this use would be exempt from the labeling
requirements. The use of closed-loop or recovery and recycling
systems as part of a process does not qualify that use as an
incidental use. Finally, a process in which methyl chloroform
serves as a solvent carrier cannot be considered incidental.
The evaporated methyl chloroform could be emitted into the
atmosphere,
thus contributing to the destruction of the ozone layer.
3. Transformation
In the Notice of Proposed Rulemaking, EPA proposed exempting
products that are manufactured with a process using a controlled
substance in which that substance is not emitted but instead
transformed (i.e., completely consumed into a non-ozone-depleting
substance during the manufacturing process) and therefore no
longer poses a threat to the ozone layer. EPA reasoned that
since Congress exempted transformed controlled substances from
the definition of production for purposes of the phaseout
provisions,
it would not have intended to require labels on products
manufactured
using a process that transforms controlled substances. Under
the statute definition of production, after all, transformed
controlled substances are treated as though they never existed.
The definition of transformation, for purposes of section 611,
was proposed to be "to use and entirely consume a controlled
substance by changing it into one or more substances that are
not subject to this subpart in the manufacturing process of
a product or chemical" (57 FR 19166, 19198).
Several comments addressed the need for a clearer definition
of transformation, especially one that took into account of
the physical law that chemical reactions are never 100% efficient
and thus leave "trace quantities" of controlled unreacted
substances.
One commenter requested that EPA exempt certain transformation
processes, such as plasma etching (described above) from the
labeling requirement.
EPA has promulgated regulations for the phaseout of production
and consumption of class I substances by 2000 (57 FR 33754,
July 30, 1992). Those regulations define, transformation as
"to use and entirely consume (except for trace quantities) a
controlled substance in the manufacture of other chemicals for
commercial purposes." That definition reflects that transformation
results in "trace quantities." Today, EPA adopts that definition
for the labeling rule. The trace quantities exception acknowledges
that transformation unavoidably leaves insignificant amounts
of controlled substances that are not intended for commercial
use. Plasma etching is considered a process that entails
transformation,
and thus products manufactured using plasma etching need not
be labeled, unless they are otherwise subject to the regulations.
Several commenters urged that methyl chloroform (MCF) used
as a source of chlorine molecules in an oxidation process of
semiconductor manufacturing should be considered to be transformed
during such manufacture, because the MCF breaks down to provide
a source of chlorine and therefore does not contribute to ozone
depletion. One large manufacturer indicated that at high
temperatures
and where there is an excess of oxygen, no MCF will remain or
be emitted. If in the oxidation process of semiconductor
manufacturing,
MCF is transformed, except for trace quantities, EPA would not
require that resulting product to be labeled.
One commenter suggested that a process in which a class I
substance has been generated as a coincidental, unavoidable
by-product (CUBP) be considered transformed and consequently
exempted from the requirement{3}. EPA agrees that use of such
a process should not require the resulting product to be labeled,
but for different reasons than the comments give. CUBP does
not entail the use of a controlled substance, rather it involves
the unavoidable production of such a substance. Since a process
that results in CUBP does not use controlled substances, it
does not fall under the definition of "manufactured with a process
using" ozone-depleting substances for purposes of triggering
the labeling requirements. Since CUBP is unavoidable, moreover,
little purpose would be served by requiring manufacturers using
such a process to label their products. EPA therefore finds
that the labeling requirements do not apply to products
manufactured
using a process EPA has determined meets the CUBP exemptions
criteria under the regulations implementing section 604 (57
FR 33754-33765, July 30, 1992). Additionally, EPA addresses
trace quantities of unintended residues or impurities below
in section D.3.
³{3} A CUBP is a coincidental unavoidable by-product
³of a manufacturing process that is immediately
contained
³and destroyed by the producer, using a maximum
available
³control technology with a destruction efficiency of
99.99%.
It is important to note that the destruction of a controlled
substance in a manufacturing process other than the process
in which the product itself is manufactured is not regarded
as transformation. For example, if in a production process a
company uses a controlled substance and then removes it from
the process for incineration in a separate destruction process
within the same facility, that substance is not transformed;
it is destroyed. Even though the destruction of the substance
will prevent the risk of release into the stratosphere, it is
not transformation and will not be dealt as such for the purposes
of this rule.
4. Destruction
At the Fourth Meeting of the Parties to the Montreal Protocol
(the Parties), which took place November 23-25, 1992 in Copenhagen,
the Parties approved five destruction technologies to be used
for destroying class I substances. Under the existing Protocol,
"production" of controlled substances is defined as "the amount
of controlled substances produced, minus the amount destroyed
by technologies to be approved by the Parties." These approved
five destruction technologies (liquid injection incineration,
reactor cracking, gaseous/fume oxidation, rotary kiln incinerators,
and cement kilns), enable the Parties to subtract from the
definition
of production that amount of ozone-depleting substance(s) which
is destroyed by these means. EPA is currently revising its draft
proposal of the regulation accelerating the phaseout of class
I and class II substances to address this issue among others
raised in Copenhagen.
EPA seeks comment on whether it could and should provide
an exemption from the labeling requirements for the use of
controlled
substances that are destroyed using one of the above-mentioned
approved technologies. The destruction technology procedures
would have to be consistent with regulations under the Resource
Conservation and Recovery Act and other applicable acts, and
meet, at a minimum, standards set forth in Table 5-1 of the
United Nations Environmental Programme (UNEP) report entitled,
Ad-Hoc Technical Advisory Committee on ODS Destruction
Technologies,
and the code of Good Housekeeping Procedures for destruction
setforth in section 5.5 of the UNEP Report. Destruction
technologies
would also have to be operated, at a minimum, in accordance
with the UNEP report.
Since the ultimate goal of Title VI is to minimize depletion
of stratospheric ozone, such an exemption that would recognize,
and provide an incentive for, the elimination of emissions of
controlled substances through the use of approved destruction
technologies is one method of reducing risks of ozone depletion.
5. Use Reduction Exemption for CFC-113 and Methyl Chloroform
Used as Solvents
In the proposed rulemaking, EPA did not propose excluding
a "de minimis level" of use of a controlled substance from its
definition of products "manufactured using," but requested comments
on how a "de minimis" exemption could be implemented. EPA's
rationale against such an exemption was that though an individual
use of a controlled substance may be small, such uses in the
aggregate over an entire use sector could pose a significant
threat to the ozone in the upper atmosphere.
EPA received many comments regarding the Agency's decision
not to propose a "de minimis" level, particularly in the case
of products manufactured with class I substances. One commenter
stated that EPA's proposed determination that aggregate use
levels over an entire market segment can be large and thus pose
a threat to the ozone layer should not preclude granting exemptions
from the labeling requirement in cases where a company can show
that its use of a class I substance is nonetheless de minimis.
Many commenters provided options for an aggregate "de minimis"
level. Some suggested that where a firm has achieved a 90% to
95% reduction in the use of class I substances from a specified
baseline level, that EPA should find that manufacturer's remaining
uses of class I substances to be "de minimis." Other commenters
suggested defining a de minimis level as a specified amount
of a class I substance that could be used per product on an
annual basis. However, in evaluating this particular approach,
the Agency has concluded that it cannot possibly investigate
use of class I substances in the manufacture of all individual
products.
Some commenters suggested a de minimis exemption for specific
applications using "small quantities" of class I substances,
including degreasers for steel products. Another proposal was
simply to set a de minimis level for carbon tetrachloride (CCL4)
at 0.1% by weight, or 1,000 ppm in a final product.
EPA does not find any of the proposals suggested above to
be practical or lawful. However, EPA does recognize that
manufacturers
who are attempting to eliminate the use of ozone-depleting
substances
may be unable at this time to completely eliminate such use,
because potential substitutes may not be available for all uses.
The Clean Air Act provides exemptions from the labeling requirement
for products manufactured with class I substances, if the
"Administrator
determines that there are no substitute products or manufacturing
processes that: (a) Do not rely on the use of such class I
substance,
(b) reduce the overall risk to human health and the environment,
and (c) are currently or potentially available." Given the wide
range of uses of class I substances, EPA will not be able to
assess the availability of substitutes for all substances and
uses in all manufacturing processes in the short amount of time
before the labeling regulation takes effect. The petition process,
discussed in section V.P below, accommodates requests for specific
exemptions, but exclusive reliance on this process would be
administratively impractical in view of the relevant timeframe
and EPA's limited resources.
The United Nations Environment Programme (UNEP) "Report of
the Solvents, Coatings and Adhesives Technical Options
Subcommittee,
1991 Assessment," states that potential substitutes other than
HCFCs may not be available for approximately 2% to 8% of the
current uses of class I substances as solvents in the solvent-
cleaning, adhesives, coatings and inks end-use sectors across
industry{4}. The class I substances used in these solvent sectors
are CFC-113 and methyl chloroform (MCF). The specific HCFC
alternatives
are problematic because they are either relatively high in ozone
depletion potential, less technologically feasible for the specific
uses required, or not economically viable for many of these
uses. EPA believes that those products "manufactured with" the
uses of CFC-113 and MCF for which no long term adequate substitutes
currently appear to be technologically or economically feasible
would be eligible for the exemption described above. While the
statute conditions the availability on a determination of a
potentially available substitute, EPA notes that it must base
its determination on currently available evidence. If current
evidence indicates that potential substitutes are not
technologically
and economically feasible, EPA believes it should make the required
determination and provide an exemption.
³{4} In contrast, the UNEP reports covering other end-
³use sectors, such as refrigerated appliances, halon
extinguishers,
³air conditioners and foams, do not indicate a similar
³difficulty in finding long-term substitutes.
However, it is administratively impossible for EPA to identify
and describe all uses or types of uses of CFC-113 and MCF in
the solvent-cleaning, adhesives and coatings sector which may
warrant an exemption. The UNEP report speaks to broad applications
of CFC-113 and MCF in the solvent sector and does not attempt
to identify the specific uses for which there are no
technologically,
environmentally and economically viable alternatives. Although
it is possible to describe certain applications where it has
been difficult to find substitutes, a comprehensive list of
such applications would be extremely difficult to compile due
to the many diverse and specialized uses for these ozone-depleting
solvents.
One gains a better understanding of the difficulty of listing
all the applications for CFC-113 and methyl chloroform by comparing
some of their solvent uses to uses of CFCs as refrigerants.
In refrigeration, an application is defined by the refrigerant
(e.g., CFC-11 or CFC-12) and the equipment (e.g., centrifugal
building chiller or household refrigerator). In contrast, solvent
use itself is broken down into multiple use categories ranging
from large uses such as solvent cleaning or aerosols to much
smaller uses such as lubricant carriers or book preservation.
Each of these use categories is then further defined by a variety
of factors. Use of solvents as cleaning agents alone is defined
by:
-Equipment-Cleaning equipment can vary in size and throughput
capacity from a vapor degreasing system designed to clean
airplane wings to a small spray can used for cleaning electrical
locks
-Chemical-CFC-113 or methyl chloroform
-Geometry of the part-Part configurations range from
high-performance
instrumentation such as accelerometers and medical pacemakers
to parts as simple as nuts and bolts
-Substrate-Parts can be made from materials varying from basic
carbon steel to magnesium to ceramic to plastics for contact
lenses
-Cleanliness-Even for the same part, cleanliness standards vary
greatly so that, for instance, a transmitter in a fighter
aircraft is cleaned to a different standard than one in a
child's walkie-talkie.
These parameters turn the listing of substitutes for each
application into a complex undertaking. If one of the variables
changes even slightly, the substitute must change, too. For
example, gyroscopes (instruments designed to detect movement)
with silicon fill fluids are cleaned with different substitutes
than those filled with fluorinated compounds.
Generating a list of all solvent applications for which
substitution
is difficult would involve splitting out innumerable
sub-applications
within the solvent use sector. While the Agency is aware that
certain applications may have few satisfactory substitutes,
it cannot in the time available compile a comprehensive list
of solvent uses of CFC-113 and MCF for which no potential
substitutions
exist; nor can the Agency make such a determination for individual
solvent uses without the data that it expects to receive under
the petition process.
Under these circumstances, EPA believes that manufacturers
who use CFC-113 or MCF as solvents should not be required to
label their products where such manufacturers have made good
faith efforts to eliminate their uses of such substances, but
have been unable to completely eliminate them due to the remaining
small uses for which substitution is particularly difficult.
The Agency believes that it is therefore appropriate to exempt
products "manufactured with" CFC-113 or MCF from the labeling
provisions where the products' manufacturer can show that it
has reduced its use to that percentage for which the UNEP report
estimates substitutes are not available. Therefore, taking the
mid-point of the UNEP estimate, or 5%, EPA believes that it
is appropriate and consistent with the provisions of section
611(d)(2) to exempt a company from the labeling requirements
if the company is able to prove that it has reduced its use
of CFC-113 and MCF as solvents to 5% of its 1990 use.
This exemption applies only to products "manufactured with"
CFC-113 and MCF used as solvents. The uses of these and other
class I substances in products containing or in containers of
such substances would not be covered by this provision. These
categories constitute a much more limited number of applications
and therefore do not entail the administrative burdens of
evaluating
the availability of substitutes across a wide array of small
uses.
By allowing this exemption, EPA recognizes that where a company
has reduced its use of CFC-113 and MCF as solvents for its products
by 95% or greater since 1990, the remaining use of such substances
is likely due to the lack of technologically and economically
feasible long-term substitutes for such use as discussed in
the 1991 UNEP Report. EPA is using 1990 as a baseline because
it is the first full year of control on CFCs under the Montreal
Protocol and the year in which the Clean Air Act Amendments
were enacted. As a result, many companies began maintaining
adequate records on their overall use levels of these compounds
at that time.
EPA recognizes that this approach cannot exactly duplicate
the usage results that would have occurred had EPA been able
to make individual determinations as to which uses had no currently
or potentially available alternatives and thus which specific
uses should be exempt. This exemption may benefit certain
manufacturers
that would not have otherwise been able to take advantage of
an exemption, and may not adequately cover those manufacturers
who still require greater than 5% of their 1990 use for
applications
where there are no potentially available substitutes. These
manufacturers can, however, still use the petition process to
request an exemption for such uses. Nevertheless, EPA believes
that given the extreme administrative difficulty of evaluating
exemption requests for the many small uses of CFC-113 and MCF
as solvents, and the likelihood that remaining solvent uses
will require further research and development before satisfactory
substitutes can be brought to market, its approach is an
appropriate
and workable surrogate. Such a provision will allow companies
to focus their efforts on the search for substitutes, rather
than face the burden of documenting their use and of petitioning
EPA for such exemptions.
EPA believes that this approach will also encourage early
reductions of class I substances by users seeking to reach the
95% level to avoid the labeling requirement. Such reductions
could lead to significant early environmental benefits which
would outweigh any environmental damage that may result from
providing an exemption for products manufactured with the remaining
5%, for the limited period prior to the January 1, 1996 production
phaseout. EPA believes that without this use reduction exemption,
in some instances manufacturers would have less of an incentive
to reduce their use of CFC-113 and MCF as solvents prior to
the required production phaseout. Without this exemption, if
a product is manufactured using any amount of CFC-113 or MCF
as a solvent, it would have to be labeled. If the manufacturer
is required to label its product because of a single remaining
use in its manufacturing process, it would be less likely to
reduce any other uses of CFC-113 or MCF because the product
would still require a warning statement. However, if a manufacturer
can avoid the labeling requirement by reducing its use by 95%,
the manufacturer will be more likely to make such a reduction
in order to avoid the labeling requirements.
To utilize this reduced use exemption, a company must certify
in writing to EPA that it (including its divisions, branches
or facilities) has achieved a reduction in its total use of
CFC-113 and MCF as solvents by 95% or greater from its calendar
year 1990 use of such substances as solvents. The company must
show that it has reduced its use from its 1990 levels by 95%
during a twelve-month period which can be calculated either
as the twelve-month period ending within sixty (60) days of
the date the certification was received, or as the most recent
calendar year.
The Agency is limiting this exemption to those companies
that can certify their reduction by May 15, 1994 in order to
encourage early reductions of such substances. There would be
negligible environmental benefit to allowing certification beyond
May 15, 1994, given the January 1996 phaseout date. Companies
unable to meet this deadline may still petition EPA for an
individual
exemption, although the petition process is likely to be time-
consuming. Once a company has received an exemption from labeling,
the exemption from labeling is assured beyond May 15, 1994;
however, if at any time a company increases its use of CFC-113
or MCF as solvents such that its use is greater over a twelve-
month period than 5% of its 1990 usage, it must notify the EPA
within thirty (30) days and must begin labeling.
In calculating the baseline, a company may subtract from
both the baseline and total use calculations uses of CFC-113
or MCF where the chemicals were transformed, because such uses
are themselves the basis for an exemption (described above).
If purchase orders of MCF or CFC-113 are used as the basis for
calculating the baseline or reduction levels, adjustments for
changes in inventories must be made to reflect actual use.
Records (or legible copies) supporting a company's assertion
that it has reduced its use must be maintained at a single facility
within the company. The certification to EPA must specify the
facility where the records supporting a company's reduction
are located. The certification must include a description of
the records (purchase orders, inventoried stock records) maintained
at that location, and the type of system used to track company-
wide use. All certifications must provide the name of a contact
person, address and telephone number for that contact person.
Certifications should be sent to the Labeling Program Manager,
Stratospheric Protection Division, Office of Atmospheric Programs,
U.S. Environmental Protection Agency, 6202-J, 401 M Street,
SW., Washington, DC 20460. One copy should be submitted to the
Agency and one must be retained by the company.
During a field inspection, EPA may require verification of
a company's use in 1990 of CFC-113 and MCF as solvents that
year and of its 95% reduced use during a subsequent twelve month
period. A company must therefore make the appropriate adjustments
to its records to account for the use of inventoried CFC-113
and MCF solvents in 1990 and in the subsequent twelve month
period showing the 95% reduced use. If a company subtracts use
associated with transformation in its formulation, data showing
a clear association of quantities of use with provable
transformation
must also be accessible with the above records upon request
by EPA.
The Agency understands that many companies have available
the information outlined above for tracking company-wide use
of CFC-113 and MCF, as well as its use of other class I substances.
The pending acceleration of the phaseout and the Clean Air Act
regulations have prompted many companies to track their uses
of class I substances in their efforts to comply and to anticipate
elimination of the substances. Other companies may have to upgrade
their tracking systems in order to utilize the reduced use
exemption
provision.
Companies seeking to qualify for this exemption by the time
the labeling regulations take effect on May 15, 1993, must certify
to EPA by May 15, 1993 that they have met the reduction
requirements
outlined above, in order for the Agency to review such
certifications.
Companies seeking to qualify for this exemption following the
effective date of the labeling requirement must certify to EPA
their total reduced use of CFC-113 and MCF as solvents for a
twelve month period ending within sixty (60) days of the date
the certification was received, or the last calendar year. A
company may then cease to label its products fourteen (14) days
following the Agency's receipt of the certification. If a company
decides not to label its products manufactured with CFC-113
or MCF based on this reduced use exemption, the burden of proof
is on the company to show, upon request by EPA, adequate data
outlined above demonstrating that it is legally eligible to
use this provision.
D. "Products Containing" and "Containers Containing"
1. Distinction Between "Products Containing" and "Containers
Containing" and Label Requirement
In the proposed rule, EPA defined containers of class I or
class II substances as "the immediate vessel of any size in
which that substance is stored or transported." EPA further
stated that this definition included cans, drums, trucks and
isotanks of class I or class II substances alone or in mixtures"
(57 FR 19166-19167).
One commenter inquired whether containers such as degreasing
units or large empty tanks, which may be used to hold such
substances,
should be labeled at the time of manufacture. Another commenter
stated that confusion existed between when a product was a
controlled
substance contained in a container and when it was a product
containing a controlled substance.
To further clarify the distinction between a controlled
substance
in a container and a product containing a controlled substance,
EPA is incorporating in its final rule today a further elaboration
of what would be covered by the requirement to label containers
of class I or class II substances. This clarification is drawn
from EPA's existing definition of bulk controlled substance
in its current phaseout regulations (July 30, 1992, 57 FR 33754,
33788). This definition states that, "If a listed substance
or mixture must first be transferred from a bulk container to
another container, vessel, or piece of equipment in order to
realize the intended use, the listed substances or mixture is
a controlled substance."
Drawing from this definition of what constitutes a "bulk"
controlled substance, EPA is revising the definition of "container
containing" for section 611 to limit the phrase to containers
holding a controlled substance: "If a class I or class II substance
that is intended to be transferred to another container, vessel
or piece of equipment in order to realize its intended use.
If the controlled substance is used in a container, vessel or
piece of equipment without being transferred, then that container
would be deemed a "product containing" and would be labeled
accordingly.
For example, CFCs in a small can sold to recharge refrigeration
equipment would be used only after being transferred to an air
conditioning system. The can would thus be labeled as a "container
containing." A large tank of halon attached to a total flooding
fire protection system on the other hand, would be labeled as
a "product containing," because the halon is used directly from
the tank itself.
In the case of a tank holding a solvent which is used as
degreasing equipment, the equipment itself is typically sold
without the controlled substance and therefore would not qualify
as either a container or a product containing for purposes of
this rule. This would hold true even though, at a later point
in time, a class I or class II substance was contained in the
tank during the use of this equipment. Thus, for equipment from
which a controlled substance is used without being transferred,
the applicable criteria is whether the equipment contains the
controlled substance at the time of sale. It would not be logical
to require labeling after the point of sale when consumer decisions
are made. At the same time, to require labeling of all products
that could be "used with" a controlled substance would be overly
broad and discourage the sale of equipment that could be used
with either a controlled substance or an alternative. However,
for containers containing controlled substances, the container
must be labeled whenever it contains a controlled substance,
whether or not it contained a controlled substance at the time
it was originally purchased.
2. Label Pass-Through Requirement for "Products Containing"
and "Containers Containing"
As discussed in section V.C. above, if a component product
that was "manufactured with" a controlled substance is incorporated
into another product, these regulations do not require the
manufacturer
of the final product to pass the labeling information accompanying
the component product through the stream of commerce. However,
EPA is requiring that a warning statement for products and
containers
containing controlled substances be passed through the stream
of commerce. There are several significant distinctions between
"products and containers containing" and "products manufactured
with" that indicate that the pass-through requirement should
be retained for "products and containers containing." First,
whereas a manufacturing process can be reasonably defined as
not including the manufacture of components, the term "product
containing" cannot be read to exclude components that are
themselves
contained within the structure of the product. If a component
part contains controlled substances, the final product still
contains the controlled substance at the point of sale.
Moreover, unlike products manufactured with controlled
substances,
it is much less onerous for a manufacturer to determine whether
or not a product or container purchased from a supplier contains
an ozone-depleting substance since the substance is held within
the product's physical structure. Also, because the controlled
substance is held within a product or container's structure,
the release of the controlled substance into the atmosphere
has not yet occurred. The consumer will generally release the
substance through the use of the product, since the substance
is likely an active ingredient of the product itself or a
propellant.
Informed by a label that indicates the controlled substances'
effect on the ozone layer, the consumer may, in many cases where
possible, take precautions to minimize or avoid the release
of the substance into the environment. A manufacturer that
purchases
products without a label must have a reasonable belief that
the product does not in fact contain a controlled substance
before incorporating it into its final product. Manufacturers
must also have a reasonable belief that a "container containing"
is accurately labeled. Finally, importers must have a reasonable
belief that information about "products containing" or "containers
containing" is accurate, as the importer is required to ensure
proper labeling at the site of U.S. Customs clearance.
3. Containers of Recaptured Substances and Waste
One commenter suggested that EPA should not require a label
on containers for storing and transporting recaptured class
I and class II substances, since such containers are reused
and may contain a number of different substances at different
times. In addition, the commenter stated that a label on such
containers has no legitimate role in that it does not assist
consumers in making purchase decisions.
EPA disagrees with this comment; a person handling such
containers
would benefit from the specific chemical information on the
label and the label would, in such case, act as a precaution
for handling procedures. Though the label does not specifically
address handling practices of such substances, it would inform
those handling these containers of the chemicals contained in
them and would encourage them to dispose of them or recycle
them correctly.
Another commenter indicated that containers of class I or
class II substance waste or waste containing trace amounts of
such substances, intended for incineration, should not require
a label since the substances will be destroyed. EPA believes
that such containers require a label, since the waste contains
a class I or class II substance which will require handling
and proper precautions prior to its incineration, and since
the waste enters into interstate commerce. Further, EPA believes
that containers of class I or class II substances to be recycled
or reclaimed must bear the warning statement, to ensure that
the technician of a reclamation facility is aware of the substances
contained in order to exercise the proper caution. Reclaimed
substances are also resold by the reclaimer, and thus should
be labeled upon introduction into interstate commerce.
Some commenters suggested that containers that once contained
an ozone-depleting substance but are later recycled through
melt down or scrapping and incorporated into another product,
should not require a label. EPA agrees that if the new product
no longer contains a class I or class II substance, it does
not require a label.
One commenter argued that for containers in which military
products "manufactured with" or "containing" class I or class
II substances are transported and then returned empty to the
originator, the label should be permitted to be "covered" by
the originator of the products so that the container may be
reused for other purposes. EPA accepts that at the point of
their return, as long as the containers are emptied of their
contents of the class I or class II substances, the label may
be covered or removed. If such container subsequently is charged
with a class I or class II substance, a label would be required
at that time. EPA also would not require that a container or
vessel for transport of a "product containing" or "container
containing" be labeled; only the immediate container that holds
the ozone-depleting substance must be labeled.
4. Trace Quantities of Unintended Residues or Impurities
One commenter raised the issue whether any chlorination process
in which carbon tetrachloride (CCL4) is inadvertently produced
would require a label under the proposed rulemaking, including
such processes as the chlorination of drinking water. The comment
is based on the fact that EPA made no exception in the proposed
rulemaking for products containing unintended residual amounts
of trace quantities of a controlled substance. Such trace
quantities
are not introduced intentionally into the manufacturing process;
they are the result of a chemical reaction by which impurities
are produced and retained in the final product. They may also
be the remainder of a controlled substance that has been added
and then removed, either, for example, as a solvent or explosion
suppressant. Another commenter offered the example of the
production
of chlorine. Water and brine are combined in the process in
which the hydrocarbons contained in the water are chlorinated
during the chlorine production process. As a result, trace
quantities
of CCL4 are created. Most of these trace quantities remain in
the chlorine, which is then used in the production of other
products.
Upon reviewing numerous comments on this issue and discussions
with various segments of industry, EPA has determined that products
with trace quantities of unintended residues or impurities
resulting
from a chemical reaction in its manufacturing process, are exempt
from coverage under this rule. In these cases, the residual
controlled substance is neither intended nor serves a function
in the final product itself, and therefore EPA does not consider
the product to be a product "containing" a class I substance.
Therefore, the product falls outside these labeling requirements
for "products containing."
This position is further supported by the recent Fourth Meeting
of the Montreal Protocol Parties in Copenhagen. The Parties
approved a decision stating that insignificant quantities of
controlled substances derived from inadvertent production in
a manufacturing process or from an unreacted feedstock, or used
as a process agent, such as an explosion suppressant, which
is present in a substance as trace residues or impurities, may
be excluded from the definition of "controlled substance" under
the Protocol. EPA will soon be proposing to modify its regulations
for the phaseout of class I and class II substances to reflect
this clarification of the definition of controlled substances.
In the 2000 phaseout rule implementing section 604 (57 FR
33754), the Agency determined that where CCL4 of a controlled
substance is produced as a coincidental unintended by-product
(CUBP) of a manufacturing process and then immediately contained
or destroyed, that process need not be considered "product"
of a controlled substance. The Agency exempted CUBP production
of controlled substances listed in Groups IV and V from the
production restrictions. Because the Protocol's proposed change
to the definition of controlled substance adopted in Copenhagen
encompasses situations also covered by the CUBP, EPA will soon
be proposing to eliminate this provision from its existing
regulations.
The adoption of the Protocol's recent interpretation of controlled
substance further supports the exemption from the labeling
requirements
outlined in the trace quantities exemption in the paragraph
above. Those products containing insignificant quantities, or
trace quantities, of controlled substances present as unreacted
feedstock, from incidental or inadvertent production, or used
as a process agent, are exempted from the labeling provision.
Despite some comments on exemption of specific uses of CCL4,
the Agency believes that a product containing a controlled
substance
cannot be exempt from the labeling rule where the controlled
substance is essential to the manufacture of that product, such
as with CCL4 as an explosion prevention measure in the manufacture
of chlorine. Where such substance is intentionally introduced
to the manufacturing process, it is not inadvertent and
uncontrollable.
Only those trace quantities associated with the inadvertent
production or unintended residues are exempted from today's
rule. However, the use of CCL4 as an explosion prevention measure
does not result in the product "containing" the controlled
substance,
rather it is considered by EPA to be a product "manufactured
with" a controlled substance and would require a warning statement.
Furthermore, evaporation of a controlled substance is an emission
and cannot therefore be exempt from the requirement.
E. Use of Controlled Substances for Repairs and Used Products
In the proposed rulemaking, EPA did not discuss the use of
class I substances in the repair of products or in the reuse
of products. Comments regarding these uses indicated that class
I substances may be used as solvents in the repair of a product.
EPA believes that a product undergoing repair is not being
introduced
into interstate commerce. The ultimate consumer already owns
the product and therefore, the warning statement is unwarranted.
In a similar manner, products that are resold for reuse are
products that have already been introduced into interstate
commerce.
Subsequent use or sale is not covered by today's rulemaking
(except for the prohibition on the removal of labels by
distributors,
wholesalers and retailers, discussed earlier) and therefore
the labeling requirements do not apply. In contrast, products
"manufactured with" or "containing" controlled substances that
are used by service technicians for repair or recycling purposes
should be labeled according to the label requirements applicable
to their manufacture. Such products or containers may be
manufactured
solely for use in repair or recycling applications, but are
required to be labeled pursuant to section 611.
However, EPA believes that recycled or reclaimed products
containing controlled substances, such as some solvent-cleaning
and adhesive products, are introduced into interstate commerce
as new products when they are recycled or reclaimed. Such products
must be labeled accordingly. On the other hand, EPA is aware
that some recycled products, such as packaging materials or
chemicals may inadvertently come into physical contact with
a controlled substance in which it is possible for trace quantities
to remain in the products themselves. Consistent with the exemption
in today's final rule for unintended trace quantities of residues
or impurities, EPA does not require such products where the
manufacturers are not intentionally introducing a controlled
substance into a recycling or reclamation process to be labeled.
F. Label Placement and Alternative Labeling Options
1. Label Placement
a. Clearly legible and conspicuous. In the Notice of Proposed
Rulemaking, EPA proposed to require that the warning statement
be placed on any display panel on the product's surface or
packaging
where the label will be "clearly legible and conspicuous." EPA
did not propose that the label appear on a product's principle
display panel (PDP), though EPA did request comments regarding
whether such a requirement would be appropriate. EPA also proposed
to allow alternative placement of the warning label (for example,
on hang tags, cards, or stickers) where placement on a display
panel is not feasible. One commenter supported EPA's proposed
use of hang tags, cards or stickers as alternative labeling
options. Two commenters stated that the warning statement should
appear on the product's display panel when available and, in
particular, on the PDP, where one exists, because the PDP is
conspicuous to the ultimate consumer. One of these commenters
indicated that this approach would promote equality among companies
in label placement and would satisfy the requirement that the
label be "clearly legible and conspicuous." In contrast, several
commenters indicated that the Congress did not mandate that
the label be applied to the product's PDP and that EPA should
therefore not specify the meaning of "clearly legible and
conspicuous"
in terms of prescribed label placement. Another commenter contended
that the back and side panels of a container or product could
satisfy the requirement. One commenter requested clarification
on what EPA meant by its suggestion that the label be placed
where "normally" viewed by the consumer, as opposed to where
the label is "easily or readily viewed."
After considering the comments received on label placement,
EPA has decided that the warning statement may appear on a display
panel other than the PDP as long as that label can be readily
seen and understood by the consumer at the time of purchase.
Although requiring all labels to appear on the PDP would promote
uniformity among manufacturers' labeling practices, uniformity
would come at the expense of the manufacturers' flexibility.
In view of the broad diversity of products, potentially affected
by the labeling requirements, EPA believes manufacturers will
need some latitude as to where to place the labels. If a
manufacturer
includes the warning statement on a product's PDP, this would
satisfy the requirement that the label be "clearly legible and
conspicuous," but placement in this manner is not required.
The label may be placed on any display panel as long as it is
conspicuous and clearly legible. A display panel may include
any side of a product, package or container, excluding any location
where the warning label would not be "conspicuous and clearly
legible." A display panel may include the bottom side of a product
package or container where the bottom side is normally used
to convey consumer information and is likely to be viewed by
the consumer at the time of purchase. For example, a label on
the bottom of a refrigerator or its shipping carton would not
be readily available to the ultimate consumer; however, a label
on the bottom of a portable radio would be appropriately placed
because a purchaser is likely to examine the whole product prior
to buying the product and additional information regarding the
radio telephone would normally be found on its underside. Products
that are sold in containers should be labeled directly on the
container or display, rather than on the product itself, such
as an electronic game. Finally, EPA is also permitting a number
of alternative labeling options as discussed below.
2. Alternative labeling options
a. Alternative labels. The proposed rule indicated that for
products that are irregularly shaped or small, alternative
labeling,
such as hang tags, tape, cards, stickers or similar overlabeling
could be used so long as the label or warning statement was
securely attached to the container, product, outer packaging
or display case. These alternatives are included in the final
rule. An alternative label must be clearly legible and conspicuous.
As long as the warning statement is at least as conspicuous
on an alternative label as it would be on a product itself,
the manufacturer has the discretion as to which of these labeling
methods is used for irregularly shaped or small products. Such
alternative labels must themselves be clearly legible and
conspicuous.
b. Supplemental printed material. While EPA prefers that
manufacturers place the warning label on a display panel on
the product or its outer packaging, or use overlabeling where
alternative labeling is necessary, labeling using supplemental
printed material could also satisfy the section 611 requirement.
EPA defines supplemental printed material as information which
accompanies a product and which the consumer is likely to read
at the time of purchase. (Supplemental printed material that
is only available to the consumer after the time of purchase
of the product would not satisfy the labeling requirements.)
Examples of these options include, but are not limited to, warnings
included on invoices, bills of lading, package inserts and Material
Safety Data Sheets (MSDS), so long as they are likely to be
read before the purchase is completed. Supplemental printed
material would be most appropriate if a product has no PDP or
display panel area, or if the warning statement would be as
conspicuous to the consumer on such printed material as it would
be on the product. It would also be appropriate to include a
warning statement on supplemental printed material such as an
invoice, for a shipment of products sold in large quantities
(e.g., nuts and bolts), rather than labeling individual items.
Where supplemental printed material is used, the warning statement
would have to be clearly legible and conspicuous to the consumer
at the time of purchase.
Two commenters asked EPA to clarify that additional labeling
(on a product or in advertising about the product) is not required
when the label appears on supplemental printed material. In
response, EPA confirms that should a manufacturer choose to
implement the labeling requirement using supplemental printed
information, additional labeling is not required. Again, the
governing principle is that the purchaser be able to read and
understand the label at the time of purchase.
Another example of where supplemental printed material would
be appropriate is in the case of medical devices that are purchased
directly by a hospital or clinic and not by the patient. For
example, EPA realizes that some medical products are administered
directly by hospital or clinic personnel to a patient, without
necessarily informing that patient of whether the medication
or medical device was made with a controlled substance. The
patient is less likely to be adequately informed about the product
or to make a choice regarding the product due to hospital
procedures
and the circumstances under which the patient receives treatment.
In such cases, EPA believes that the ultimate consumer is the
person making the immediate purchasing decision of that product
on behalf of and for the use by a patient. Supplemental information
must accompany the products to the point at which the purchaser
accepts the products and need not be communicated directly to
the patient.
Labeling of supplemental printed material may also be
appropriate
for prescription drug products containing controlled substances
that are deemed "essential" by the Food and Drug Administration
(FDA), such as metered dose inhalers. (See discussion on medical
products in section V.I. below.)
While supplemental printed material may be a label placement
option for most products, containers of class I or class II
substances that are smaller than 55 gallon drums must be labeled
directly on their PDPs or display panel areas. Containers of
controlled substances that are larger than 55 gallon drums may
apply the warning statement on supplemental printed information
to convey the warning statement, as long as it is clearly legible
and conspicuous to the purchaser either at the time of purchase
or time of delivery provided the purchase is not complete until
delivery is accepted. EPA believes that containers larger than
55 gallon drums, such as railcars, trucks and aircraft need
not bear a label directly on them since they carry other containers
and products as well, and information regarding the contents
is usually viewed in supplemental information by the consumer
upon delivery.
c. Products not viewed by the purchaser prior to or at the
same time of purchase. Several commenters stated that some products
are typically sold over the phone or through the mail, so that
labeling the product itself would not provide the information
to the purchaser until after the point of purchase.
In the NPRM, EPA discussed the use of supplemental printed
material as an alternative to placing the labels directly on
the a product, its display or packaging. Supplemental printed
material was defined in terms of printed or graphic informational
or promotional material. In order to address the issues described
above, EPA has distinguished between supplemental and promotional
printed material in the rule promulgated today. Supplemental
material accompanies the product and is available for the consumer
to read at the time of purchase. Promotional printed material,
by contrast, does not accompany a product and is available prior
to the point of purchase by appearing in or on newspapers,
journals,
catalogues and displays, for example.
Congress' purpose in requiring products to be labeled was
to provide consumers with information regarding the use of ozone-
depleting substances so that they can use the information in
making their purchasing decisions. To accomplish this purpose
in the case of products normally purchased sight-unseen,
manufacturers
or sellers may use either of two approaches. First, promotional
printed material may be used to inform consumers of the use
of ozone-depleting substances. The required information must
appear on the promotional printed material in a clearly legible
and conspicuous manner.
Second, a company may place the label on a product or its
packaging, or use alternative labeling as described above, so
that the requisite information is clearly legible and conspicuous
to the purchaser at the time of product delivery. However, this
option requires that either the purchase not be completed until
delivery is accepted (e.g., COD orders) or the purchaser be
permitted to return the product following its delivery. For
the labeling requirement to serve Congress' purpose, where
information
is not made available when the purchase order is placed, customers
must at least be allowed to refuse delivery or to return the
product after that information is made available.
d. Competing information. Several commenters argued that
the label would compete with other labeling information on
restricted
package space and that overcrowding the existing PDP would make
the information difficult to read and inhibit the consumer from
reading it. EPA does not agree, especially given EPA's acceptance
of alternative label placement options which provide manufacturers
with flexibility to address circumstances where applying a label
directly on a product may not be appropriate or viable. In
addition,
EPA is not directing companies to increase the size of their
products' packaging to accommodate the label bearing the warning
statement, as some commenters inferred. In any case, section
611 specifically requires that the label be "clearly legible
and conspicuous."
e. Parallel to existing information. EPA proposed that the
warning statement must appear parallel to any base on which
the product or container is being displayed. Some commenters
recommended that EPA instead prescribe that the label be parallel
and aligned with all other labeling information on the product.
EPA agrees with this recommendation. Further, if the warning
statement is on supplemental printed material, the statement
must also be parallel and aligned with other labeling information
in the printed material.
G. Products Manufactured for Export Only
The proposed rule did not specifically address the issue
of whether labeling is required for products manufactured for
export only. Several commenters urged EPA not to require that
products manufactured for export meet the labeling requirements.
Commenters indicated that a requirement for labels bearing the
warning statement on exports would put products manufactured
in the United States at a competitive disadvantage in the world
marketplace, compared to products manufactured in countries
where labeling is not required. Moreover, commenters noted that
EPA could not enforce the labeling requirement beyond U.S.
boundaries;
therefore, labels on exported products could be removed after
they leave United States territory but before they reach consumers.
EPA does not believe that products manufactured for export
only should be subject to section 611's labeling requirements.
Section 611 applies to products that are "introduced into
interstate
commerce," but makes no reference to foreign commerce. The Clean
Air Act does not define "interstate commerce." However, EPA
believes that section 611's use of interstate commerce does
not include "foreign commerce" (i.e. commerce outside the United
States). See Border Pipe Line v. Federal Power Commission, 171
F.2d 149 (D.C. Cir. 1948) (interstate commerce does not generally
include foreign commerce); Distrigas Corporation v. Federal
Power Commission, 495 F.2d 1057 (D.C. Cir. 1974). See, also
e.g., 18 U.S.C. 10, which defines interstate commerce and foreign
commerce separately.
Exports primarily affect foreign commerce. Although it may
be argued that exports are introduced into interstate commerce
when they are transported from the manufacturer within the United
States to the place of export, EPA does not believe that products
manufactured for export only should be covered by section 611.
EPA has considerable discretion in determining the scope of
the term "introduced into interstate commerce" for purposes
of these regulations. As the Supreme Court noted, the term
"interstate
commerce" cannot be subjected to any single definition for every
federal statute regulating commerce.{5} Court decisions have
not been uniform regarding the point at which a product destined
for foreign commerce should be considered as being in "foreign
commerce" when it is traveling to port.{6} Courts have looked
to the essential purpose of statutory provisions in determining
the scope of the term "interstate commerce."{7} EPA therefore
believes that its determination of whether exports should be
included within the scope of the labeling requirement should
be based on the intent of section 611 and EPA's ability to pursue
its enforcement responsibilities under section 611. Based on
this analysis, EPA does not believe that the term "introduced
into interstate commerce" should be extended to include products
manufactured for export only.
³{5} McLeod v. Threlkeld, 319 U.S. 491, 495, 63 S. Ct.
³1248, 1250 (1943); see also United States v. Auguello,
³452 F.2d 1135, 1141 (2d Cir. 1971) (in determining the
³scope of the term interstate commerce in a criminal
statute,
³the court noted that cases from other areas of the law
³are an unreliable guide to the interpretation of the
³statute at issue).
³{6} See, e.g., Japan line, Ltd. v. County of Los
Angeles,
³441 U.S. 434, 437, 99 S. Ct. 1813, 1815 (containers are
³found to be instrumentalities of foreign commerce where
³they "engage in no intrastate or interstate
transportation
³except as continuations of international voyages");
Connell
³Rice & Sugar Co. v. County of Yalo, 569 F.2d 514
(9th
³Cir. 1978) (products in storage that were bound for
export
³were subject to local taxation because they had not
actually
³entered the export stream); Southern Pacific
Transportation
³Co. v. I.C.C., 565 F.2d 625 (9th Cir. 1978)(whether
transportation
³is interstate or intrastate "is determined by the
essential
³character of the commerce, manifested by the shipper's
³fixed and persisting transportation intent at the time
³of shipment"); Carson Petroleum v. Vial, 279 U.S. 95,
³107, 49 S.Ct. 292, 295 (1020) (the essential character
³of the commerce, not the various steps in its
transportation,
³should determine whether it is interstate, intrastate,
³or foreign); Wentz v. U.S., 244 F.2d 172, 176 (9th Cir.
³1957) (court found that where telegram from California
³to Mexico was initially transmitted to Texas and then
³retransmitted to Mexico, the initial transmittal was
³in interstate commerce).
³{7} See United States v. Castro, 837 F.2d 441 (11th
³Cir. 1988) (failure of Congress to specifically include
³imports in statute does not mean that imports are
excluded
³where legislative history and essential purpose of the
³statute indicate that imports should be included);
Distrigas
³Corporation v. Federal Power Commission, 495 F.2d 1057,
³1064 (D.C. Cir. 1974) (legislative history of Natural
³Gas Act indicates that imports and exports were meant
³to be excluded; nonetheless, the court would include
³imports and exports within the scope if exclusion would
³be contrary to the purpose of the statute).
As discussed above, the labeling requirements are designed
to alert consumers to the fact that ozone-depleting substances
are contained in a product or were used to manufacture it. However,
during the period that the exports are traveling to port, they
can have no effect on the purchasing decisions of consumers,
as no consumers will see the product until after it has left
the United States. Moreover, as the labels will be in English,
many of the products that are labeled will be sent to countries
where the labels will not be understood. In addition, once a
product has left the United States, EPA cannot prevent labels
from being removed from the product. Therefore, EPA cannot ensure
that products exported from the United States will be labeled
when they are viewed by the consumer, which would defeat the
purpose of the labeling requirement.
Unlike products sold in the United States, products produced
and sold abroad do not have to meet the labeling requirements
of section 611. EPA recognizes the competitive disadvantage
that U.S. manufacturers would have in the foreign marketplace
as a result of having to label. Consumers in the foreign
marketplace,
when faced with two otherwise identical products, one which
is labeled and the other which is not, would likely choose the
unlabeled product even though the unlabeled product may also
contain or be manufactured with ozone-depleting substances.
If U.S. regulations were to require domestic products manufactured
only for export to be labeled while products manufactured and
sold in other countries were not, U.S. products would be placed
at an unfair disadvantage in the foreign marketplace with no
compensating benefit to consumer choice, since foreign consumers
would incorrectly infer that non-U.S. products did not contain
or involve the use of ozone-depleting substances.
Agencies have excluded exports from similar requirements
on other occasions. For example, the Consumer Product Safety
Commission has exempted products from requirements of the Consumer
Product Safety Act, 15 U.S.C. 2015 et. seq., where the products
are never distributed in commerce for use in the United States,
and exempted from the Federal Hazardous Substances Act, 15 U.S.C.
1261 et. seq., where the products are never sold or offered
in domestic commerce. See 16 CFR 1010.1 (b).
To avoid application of this rule, products manufactured
solely for export may not be sold within the United States.
EPA is requiring that products and containers manufactured for
export be clearly identified as such at the warehouse or facility
from where the export will be transported and that any additional
documentation for such products or containers be readily available
on site. This is to enable Federal enforcers to distinguish
between products or containers for domestic sale, which require
labels, and those intended only for export, which do not.
H. Imports
EPA proposed that imports be covered by the labeling
requirements
and regarded imports as having entered interstate commerce at
the site of U.S. Customs (Customs) clearance.
Several commenters asked whether the Agency plans to inform
Customs of the new labeling requirements. EPA has agreements
with Customs under other existing regulations to inspect imports
and will work further with Customs to ensure that products and
containers entering the U.S. meet the requirements of section
611.
The definition of "import" in today's final rule is consistent
with the definition promulgated under regulations implementing
section 604 of the Act (57 FR 33754, 33788, July 30, 1992).
There are two situations described in the section 604 rule that
are excluded from the definition of "import" also adopted here.
One pertains to the off-loading of class I or class II substances
from ships during servicing. EPA believes that temporary off-
loading containers or products containing or manufactured with
controlled substances should not be considered importation since
the products are not being introduced into interstate commerce.
Therefore, they should not fall under the labeling provision.
The other case involves products or containers introduced
in bond at the Mexico border. Under the Maquiladora Agreement,
the United States and Mexico established a free-trade zone along
a segment of the U.S./Mexico border. Essentially, products are
permitted to be transported across that zone without any U.S.
Customs restrictions being imposed. Products manufactured with
or containing controlled substances or containers charged with
controlled substances within this zone established by the
Maquiladora
Agreement are not considered to be imported products. At the
same time, such products or containers are being introduced
into United States interstate commerce, and are therefore subject
to the labeling requirements.
Some commenters argued that if they purchase foreign products
manufactured with a class I substance from other companies and
incorporate them into their own products, their final products
should be exempt from the labeling requirement. As discussed
above, the final rule eliminates the requirement that a
manufacturer
must label its product if a component product was manufactured
with a controlled substance. Thus, if a manufacturer incorporates
a component product manufactured with a controlled substance
into its product without using a controlled substance in its
own manufacturing process, under today's rule, its product is
not required to bear a warning statement. Manufacturers
incorporating
component products into their products need not investigate
whether such products were manufactured with a controlled
substance.
However, U.S. parent companies that purchase products manufactured
with controlled substances from their foreign subsidiaries would
be required to label their subsequent products in the same manner
required of any U.S. company using components from a domestic
subsidiary.
Importers of foreign products are still obligated to label
foreign products if the manufacturer of that product used a
controlled substance in its manufacturing process. If importers
were not so obligated, then imported products would have an
unfair competitive advantage over domestic products. However,
consistent with EPA's decision to eliminate the label "pass-
through" provision, an importer need only investigate whether
the final product being imported was manufactured with a controlled
substance in determining whether a warning statement is required.
The importer is not required to investigate whether component
parts of the final product were manufactured with controlled
substances.
All imported products containing and containers containing
controlled substances must be labeled at the site of U.S. Customs
clearance and must remain labeled throughout the stream of
commerce.
As discussed above, manufacturers of "products and containers
containing" controlled substances are not exempt from the
requirements
to pass information through the stream of commerce indicating
that the product or container contains an ozone-depleting
substance.
I. Medical Products
Several commenters argued that certain prescription products,
such as some metered dose inhalers (MDIs), should be exempt
from the labeling requirements because they are essential to
the health of patients. These commenters feared that the warning
statement could result in patients not using medication despite
the advice of their physicians, because the patients would be
concerned about damage to the ozone layer or would be alarmed
by the inclusion of the words "warning" and "harms public health
and environment" in the warning statement. These commenters,
which included the Food and Drug Administration, voiced concern
about the possible ill effects on the health of asthma patients
if such patients discontinued the use of MDIs as a result of
the warning statement. The commenters argued that the label
should not appear on prescription drugs, since the decision
to buy the drug is based on the physician's advice and, therefore,
the physician should be considered the "ultimate consumer" in
this case. Other commenters noted that pharmacists often receive
medical products in bulk packaging and repackage the products
for consumer purchase. In these cases, the patient would not
see the package prior to purchase, negating the purpose of the
label.
EPA understands the importance of medical products like MDIs
to many patients' health and believes it appropriate to tailor
the labeling requirement to avoid unduly alarming patients.
At the same time, section 611 does not provide the Agency with
authority to exempt any products containing class I substances
from the labeling requirement, even if such products are considered
essential. That section specifically provides that no product
containing a class I or class II substance may be introduced
into interstate commerce after the effective date without the
warning statement. Congress clearly gave EPA authority to exempt
production of class I substances needed for medical products
from the phaseout requirements of section 604 of the Act and
authority to exempt certain products "manufactured with" class
I substances from the labeling requirements of section 611 if
appropriate substitutes are available. By contrast, Congress
gave the EPA no similar authority to exempt medical products
containing class I substances from the labeling rule.
Contrary to the assertion of some commenters, there is no
basis for believing that section 611 does not apply to medical
products subject to FDA labeling rules. FDA's labeling regulations
were in effect when the Clean Air Act Amendments were enacted,
and Congress could have indicated that the labeling provisions
of section 611 do not apply to the products covered by FDA
regulations.
It did not do so, however, and since section 611 was passed
after FDA's rules and statute authorizing them, section 611
would govern in the case of any conflicts.
Within these legal constraints, however, EPA wishes to avoid
any adverse impact labels might have. As detailed above, a number
of commenters voiced concern that patients might not use medical
products essential to their health if confronted by the required
labeling information. The commenters presented no evidence
supporting
their concerns, however. EPA considers it highly unlikely that
patients would not use a medical product vital to their health
because it bore a label notifying them of the products' use
of ozone-depleting substances. Patients would more likely react,
if at all, by asking their physician or pharmacist what they
should do in view of the label's information. Such inquiries
could help create the kind of market pressure Congress sought
as a means of prodding industry to find and use alternatives.
However, as discussed earlier, EPA does allow the warning
statement to appear on supplemental printed material. In the
case of prescription products deemed essential by FDA, such
as MDIs, EPA believes that, given the concerns expressed by
commenters, it is appropriate for the statutory warning statement
to appear on supplemental printed material intended for the
prescribing physician, rather than for the patient, as long
as the supplementary printed material intended for the patient
contains language that informs the patient that the product
contains an ozone-depleting substance. EPA agrees with commenters
that the inclusion of the words "warning" and "harms public
health" on the information provided to the patient might cause
undue alarm. Therefore, if the statutory warning statement appears
on the printed material intended for the physician, then the
product or printed material intended for the patient need only
state the following: "This product contains [name of substance],
a substance which harms the environment by depleting ozone in
the upper atmosphere." Manufacturers could supplement this
information,
if they wish, with instructions for the patient to consult with
his or her physician before discontinuing use of the product.
EPA expects that FDA will provide at a later date such additional
language in the Federal Register.
EPA believes these provisions address the concerns regarding
potential adverse health effects in a manner consistent with
section 611(c), since the full warning statement will be provided
to the prescribing physician and the information that the product
contains an ozone-depleting substance will be provided to the
patient. To the extent this approach represents a partial exemption
from the statutory requirement, EPA may grant it as an exercise
of the type of administrative authority described in Alabama
Power Co. v. Costle, 636 F.2d 323 (D.C. Cir. 1979). The change
to the statutory language is minimal and the environmental
consequence
is probably non-existent. Removing the words "warning" and "harms
public health," however, avoids unduly and perhaps dangerously
alarming patients.
EPA received other comments noting the impact of FDA's labeling
regulations on the time needed for compliance with today's
rulemaking.
Based on discussions with FDA, there appear to be three ways
to implement the changes in labeling for FDA-regulated medical
products (21 CFR 314.70) manufactured with or containing class
I substances in time to meet the statutory deadline of May 15,
1993: (1) Notify FDA through the company's annual report of
the changes made to the label-such changes would be considered
"minor or editorial;" (2) partake in a supplemental process
that FDA uses to grant pre-approval for such modifications to
the existing labeling; or, (3) through "supplemental changes
being effected" or changes that may be made prior to FDA approval,
make the necessary changes and inform FDA afterwards. FDA has
informed EPA that companies should, to the extent possible,
implement section 611 labeling changes using the third option,
"supplemental changes being effected" (21 CFR 314.70 (c)2(i)).
EPA believes that it is FDA's intention to provide at a later
date specific additional language to accompany the warning
statement
for drug products containing class I substances, such as MDIs,
which would inform the patient to further consult with his or
her physician when considering the implications on their overall
health of the section 611 warning statement.
One commenter also indicated that contact lenses that are
manufactured with class I substances would be difficult to label,
because consumers generally purchase contact lenses without
packaging and the label obviously cannot be placed directly
on the lenses themselves. Manufacturers of ophthalmic devices,
such as contact lenses, may include the warning statement on
supplemental information, as long as the label appears on
information
that the ultimate consumer receives by the time of purchase.
In this context, FDA indicated that it may be notified of such
changes to a company's existing labeling information through
a manufacturer's annual report, thus requiring no pre-approval.
J. Packaging
Some commenters indicated that it would be misleading for
the warning statement to appear on a wrapper or packaging that
itself contains or is manufactured with controlled substances,
when the product inside does not contain or was not manufactured
with such substances. Packaging materials may be used for
transportation
or display purposes for products that do not contain or were
not manufactured with a controlled substance. The commenters
inquired as to whether this packaging would necessitate a label.
Such labeling, the commenters argue, could mislead consumers
into believing that the contents are themselves ozone-depleters.
In the final rule, EPA is requiring that packaging materials
manufactured with a controlled substance be labeled to inform
purchasers of such materials of the use of controlled substances
in the manufacturing of those materials. EPA believes that
packaging
materials when sold as such are products in and of themselves
and should therefore be subject to the labeling requirements.
However, consistent with the pass-through discussion in V.C.1
above, purchasers of such packaging materials are not required
to subsequently label their product based on the labeling
information
pertaining to the packaging materials.
Manufacturers that manufacture their own packaging materials
using controlled substances, or that use controlled substances
to attach the packaging to its contents, must label their product,
even if the package contents were not made with ozone-depleting
substances. In this case, the packaging is part of the product,
and if the packaging is made with controlled substances, it
must be labeled. Otherwise the anomalous result would be that
all uses of ozone-depleting substances would require labeling
except packaging. So long as the company introduces the product
into commerce using ozone-depleting substances to make any aspect
of it-including packaging-it must label the product.
K. Research and Development
In the proposed rulemaking, EPA did not specifically address
whether research and development (R&D) activities, including
R&D to find alternative substances for class I or class II
substances,
should be subject to the labeling requirements. A few commenters
stated that R&D activities should be exempt from the labeling
requirement since the products being developed are not being
introduced into the stream of commerce. EPA agrees that a product
undergoing research is not introduced into interstate commerce
and, therefore, need not be labeled. Upon conclusion of R&D
activities, any product containing or manufactured with a
controlled
substance will require a warning statement upon its introduction
into interstate commerce.
L. Warning Statement Text and Requirement
Some commenters supported the text of the warning statement,
bearing the standard chemical name. However, several commented
that there was little environmental benefit to naming the specific
chemicals used in a manufacturing process. Suggested alternatives
to the chemical name included the terms "class I substances"
and "CFCs and other substances." A commenter indicated that
the Clean Air Act's reference to "class I," should be sufficient
for the label. These commenters did not believe that stating
the specific substances used on the label was valuable to
consumers,
who do not tend to differentiate between ozone-depleting chemicals.
Therefore, according to the commenters, simply the statement
that an "ozone-depleting substance" was used in the manufacture
of a product would be sufficient for purposes of informing
consumers.
Other commenters argued that the label would detract from other
important warning hazard labels and requested that the Agency
remove the word "WARNING" from the statement.
When Congress mandated the use of labels under section 611,
it specified the exact language that should be used. This language
includes the name of the substance that is subject to the labeling
requirement and contained in or used to manufacture a product.
EPA does not believe that the use of terms such as "class I
substance" or "CFCs and other such substances" would be adequate
to meet the requirements of section 611. Furthermore, such terms
would not provide consumers with the ability to distinguish
the ozone-depleting potential of one substance relative to another,
which can vary by a factor of ten among class I substances.
The ability to distinguish allows consumers to differentiate
in making their purchasing decisions between substances with
significantly different ozone depletion potentials. As an
additional
benefit, labels containing specific chemical names facilitate
efforts related to handling, disposal, recovery and recycling
under sections 608 and 609 of the Act. Such information is
potentially
beneficial to service technicians. Therefore, EPA is not amending
its requirement that the exact name of the ozone-depleting
substance
be used in the warning statement.
Additionally, the final regulations continue to require that
the word "warning" be used to begin the warning statement. EPA
is not authorized to remove the word "warning" from the text
of the statement, since that wording is prescribed by Congress
in section 611. EPA also disagrees with the comment that the
warning statement will discourage consumers from reading a
product's
PDP or other display panel area, especially given the options
available for label placement.
Some commenters indicated that labeling relative to human
health hazards and product use and handling should be regarded
as more important and suggested eliminating the requirement
for the section 611 label in the case of these products. The
Clean Air Act mandates the warning statement and provides no
such exceptions. EPA has an obligation to implement the law
and to ensure compliance among the regulated community.
M. Recoverable Substances Label
Comments received stated that labels indicating that ozone-
depleting substances are recoverable and not mandated under
section 611 and that section 608 (recovery and recycling) does
not itself require such labels. Some comments affirmed that
many products containing class I and class II substances already
have permanent labels identifying the relevant substances they
contain. They claim that labeling for recovery purposes would
add little value to current information provided on existing
labels.
After consideration of the comments received, EPA believes
that recycling and recovery of class I substances are sufficiently
addressed under sections 608 and 609. Therefore, EPA is not
requiring a separate labeling requirement under section 611
for recoverable substances; the warning statement as specified
in that section will be the only required label for products
and containers, as outlined in today's rulemaking.
N. Symbol
In the proposal, EPA stated that it was considering, but
not proposing, the requirement of a symbol to accompany the
warning statement. EPA requested comments on the appropriateness
of such a symbol. One commenter strongly favored the use of
a symbol as discussed in EPA's proposal. However, EPA also received
numerous comments that indicated that warning statements without
corresponding symbols have been as effective as those with symbols.
These commenters further stated that symbols can be misleading
to the consumer at times. Several commented that symbols do
not provide consumers with any information in addition to what
is communicated in the warning statement. Other commenters implied
that a symbol can distract consumers from reading other important
labels on a product or container.
Some commenters indicated that incorporating the graphic
symbol would be costly, given inherent limitations in existing
printing equipment. For example, some small businesses that
print labels and supplemental information may be unable to
replicate
the graphic using existing equipment. Such businesses would
be forced to invest in new printing equipment in order to comply.
Other commenters indicated that to add the symbol would result
in altering the colors used on existing labels on products.
This could cause problems in the existing arrangement of other
printed information on the products, therefore requiring the
manufacturer to relabel all of its products. The subsequent
cost could be up to $1,000 per product label. In addition to
these economic concerns, commenters indicated that it made little
sense to make such changes and investment for substances that
will be phased out shortly.
EPA has decided to forego the use of a symbol. The Agency
believes that the 1996 phaseout of class I substances (1994
for halons) diminishes the overall utility of a symbol thus
substantially reducing the potential benefits from the use of
a symbol without reducing costs. The Agency also agrees with
commenters that the warning text would significantly increase
the cost of labeling, with little or no environmental benefit.
O. Petition Process
Four commenters supported the petition process as described
in the proposed rulemaking, citing that a process is necessary
to exempt from the labeling requirement those products for which
alternative substances and manufacturing processes are not
available.
Others supported EPA's proposed provision allowing "class action"
petitions, claiming that petitions allowing one petition for
multiple manufacturers of the same product or for similar products,
would simplify the process for companies with the same end-uses
of a class I substance.
Several commenters indicated that the rulemaking should shift
the statutory prescription and exempt all products manufactured
with class I substances unless the Agency makes a determination
that substitutes are currently or potentially available. They
argued that because of the accelerated phaseout date of 1996,
EPA could determine now that substitutes are not currently
available,
they would also not be potentially available, since the timeframe
from the effective date of this rule to the phaseout is
considerably
shorter than what it was at the time the law was written.
The language of section 611 clearly does not allow EPA to
exempt products manufactured with class I substances from the
labeling requirements unless EPA makes an affirmative
determination.
The law explicitly states that products manufactured with class
I substances must be labeled, unless the Administrator makes
an affirmative determination that no substitute chemicals or
processes exist that do not rely on a class I substance, that
reduce the overall risk to human health and the environment,
and that are currently or potentially available. EPA continues
to believe that the most appropriate way to provide exemptions
for specific products manufactured with class I substances is
through case-by-case evaluation of specific products or
manufacturing
processes through the petition process described in the proposed
rulemaking. This process allows EPA to make a sound decision
whether to exempt a product or process from labeling based upon
the specific facts provided by the petitioner. However, to avoid
being overwhelmed with individual petitions reflecting the myriad
MCF and CFC-113 used as solvents, EPA has adopted the "reduced
use exemption" described above. This exemption does not, however,
prevent any firm from applying for a specific exemption for
a product, regardless of reductions in use made by that firm,
if the criteria for an exemption contained in the regulations
are satisfied.
One commenter stated that the Agency should grant temporary
exemptions to those manufacturers that petition the Administrator
until a determination on the petition has been made. However,
EPA does not believe such an exemption is appropriate, because
it would enable manufacturers who wanted to avoid or postpone
complying with the labeling requirements to initiate the petition
process with little or no likelihood of success on the merits
of the petition. EPA wants to avoid creating such an incentive
and, therefore, is requiring that products be labeled pending
the Agency's decision on a petition.
Another commenter indicated that the EPA should expedite
the review process for petitions whenever possible. EPA agrees
and will make every possible effort to expedite the review process.
The reduced use exemption, as well as the revised pass-through
requirement and other provisions of this rule, should dramatically
reduce the number of petitions received by EPA.
One commenter inquired about the treatment of confidential
business information (CBI) included in a petition and inquired
about the Agency's ability to guarantee confidentiality. Under
the Clean Air Act, anyone submitting information for which CBI
status is requested must assert a claim of confidentiality at
the time of submission. Failure to assert a claim of
confidentiality
at the time of submission may result in the disclosure of the
information by the Agency without further notice. Further, it
should be noted that information which is publicly available
(e.g., in journals, trade magazines, product literature, etc.)
cannot be claimed as CBI. EPA will treat all claims of business
confidentiality in a manner consistent with 40 CFR part 2, subpart
B. These procedures offer petitioners significant protection
from disclosure of CBI. Though the Agency cannot guarantee that
it will be able in all circumstances to justify granting or
denying a petition without public disclosure of confidential
information, EPA will endeavor not to use confidential information
in the public participation process wherever possible. There
are situations in which the Agency has contractors "cleared"
for handling confidential information. Before the Agency uses
such contractors, it will notify any petitioner of the potential
use of such a contractor in the petition review.
One commenter indicated that EPA's description of a substance
as "currently available" did not indicate that the substitute
is widely available. The commenter urged that a substance be
considered currently available when it is marketed in "commercial
quantities." EPA agrees with this point if commercial quantities
means that they are available, but not necessarily in market-
wide quantities, and affordable. An example of such a circumstance
would be where a single company is producing and marketing an
alternative for more than one end-use; because the product is
not manufactured by more than one company, the product may not
be considered "widely available." EPA, however, believes that
substitutes that are commercially available are currently
available.
One commenter indicated that the definition of potentially
available should convey that a substitute is technologically
feasible, environmentally acceptable, and economically viable
"for a particular application," rather than for a sector-wide
or end-use-wide application. EPA agrees that for the purpose
of section 611, companies will be submitting petitions for their
individual class I substance use and that its evaluation should,
to the extent possible, be directed at that use and not at a
sector-wide review.
VI. Summary of the Final Rule and Changes from the Proposed
Rule
This section briefly describes the amendments to the proposed
rule. Any changes made to the rule language as a result of the
public comments are conveyed. A new section has been added to
reflect that position adopted today regarding companies using,
or importers introducing, products manufactured with a process
using class I substances. Various changes to the final rule
that have been made for purposes of clarification are also
described
herein. Labeling provisions discussed in the proposed rule that
are not addressed or amended in today's final rule remain unchanged
and are thus applicable in the final rulemaking.
A. Authority
The authority citation has been revised to reflect the most
recent authority citation adopted by EPA for 40 CFR part 82.
B. Purpose (Section 82.100)
This section states that the purpose of the rulemaking is
to require warning statements on containers of, and products
containing or manufactured with, certain ozone-depleting
substances.
C. Applicability (Section 82.102)
This section defines those products that are subject to the
labeling requirements of 40 CFR part 82. Paragraph (c) of this
section, pertaining to the recoverable substances label, is
deleted to reflect the Agency's determination that the handling
of recoverable and recyclable substances is sufficiently covered
in sections 608 and 609 of the Act. Products and containers
using such substances, however, are required to bear the warning
statement under paragraph (a) or (b) of this section.
Paragraph (a) of this section has been revised to indicate
that for substances added to the lists of controlled substances
after the publication of this rulemaking, the labeling regulations
shall apply to the listed products and containers one year after
such addition or earlier, if indicated in the rulemaking for
such listing. A new paragraph (c) is added to this section to
indicate that "products manufactured with" and "products
containing"
class I substances that are products manufactured prior to May
15, 1993 do not need to be labeled.
D. Definitions (Section 82.104)
This section in the proposed rulemaking contains the definitions
of the terms "class I substance," "class II substance,"
"container,"
"containing or contains," "controlled substance," "manufactured
with," "potentially available," "principal display panel,"
"product,"
"recoverable substance," "supplemental printed material,"
"transform,"
"type size," "ultimate consumer," and "warning label." The final
rule includes new definitions for "consumer," "containers
containing,"
"distributor," "export," "import," "importer," "interstate
commerce,"
"product containing," "promotional printed material," "retailer,"
and "wholesaler" in an effort to incorporate the relevant comments
into today's final rulemaking.
The definitions for a class I substance and class II substance
remain unchanged. The definition of container also remains
unchanged,
but EPA duly notes a comment regarding the word "immediate"
in the definition. A comment indicated that the proposed definition
of container could imply that the label should be applied to
the container before the introduction of a class I or class
II substance. EPA requires that upon the point of filling a
container with such a substance, the manufacturer in charge
of filling the container must label the container, and not the
manufacturer of the container itself.
The definition of "containing or contains" has been deleted;
"containing or contains" is covered now in the new definitions
of "product containing" and "container containing."
The term "controlled substance" is retained and refers to
"class I" and "class II" substances. As discussed above, it
is important to note that the effective date of specific provisions
in today's rule varies between class I and class II substances.
The definition of "manufactured with" is amended to require
manufacturers of products manufactured with controlled substances
to label according to their direct manufacturing processes and
not those related to products purchased upstream. Given this
determination, EPA considers each manufactured good a product.
EPA also changes the definition of "manufactured with" by expanding
incidental uses to include contact use, a class I or class II
substance is used intermittently in a manufacturing process;
and by adding the exception for trace quantities in the definition
of transformation. The expanded incidental use exemption was
incorporated as a result of the several comments that explained
numerous situations in which a class I or class II substance
is applied for intermittent maintenance purposes and not routinely
with the production of each product.
The definition for "potentially available" remains unchanged.
The definition for "principal display panel" is amended to delete
the guidance for determining the proper type size for the warning
statement on a PDP. Placement of the warning statement on the
PDP would clearly meet the requirements of section 611, but
there are alternative options for label placement discussed
below in part VI.F. (Section 82.108).
The definition of "product" is expanded to include products
that incorporate component products. The term "recoverable
substance"
is deleted because EPA no longer is requiring a recoverable
substances label on containers or products containing such
substances.
The "supplemental printed material" definition is amended to
include "invoices" as a means for label placement. The revised
definition also excludes the terms "written advertisements,
brochures, circulars". Such terms are categorized as "promotional
printed material" later in this section, defined as informational
material that does not accompany a product to the consumer.
The definition of "transform" is amended to incorporate the
phrase "except for trace quantities." The Agency received several
comments that argued that the definition of transformation should
remain consistent with that in the rule (57 FR 33754) implementing
section 604 of the Act. The EPA agrees with those comments.
The definition of "type size" remains unchanged. "Ultimate
consumer" remains unchanged. The definition of "warning label"
is modified to exclude the reference to the symbol in 82.106
of the regulation.
The final rule adds the following definitions to this section:
"consumer," "container containing," "distributor," "export,"
"import," "importer," "interstate commerce," "product containing,"
"promotional printed material," "retailer" and "wholesaler."
The definition for consumer is differentiated from "ultimate
consumer," in that "consumer" merely means a purchaser of a
product that has been introduced into interstate commerce. The
definition of "container containing" is added to this final
rule. As discussed in V.D.1 above, a "container containing"
is a container that holds a controlled substance until the
substance
can be transferred into the "container, vessel, or piece of
equipment" from which the use of the controlled substance will
be realized. Examples of such "containers, vessels or pieces
of equipment" are degreasing machines. These "containers, vessels,
or pieces of equipment" are defined to be products containing
as discussed earlier.
In addition, the definition of "container containing" does
not reference the time of purchase by the consumer, because
containers containing controlled substances must be labeled
whenever they contain such substances, regardless of whether
they contained such substances at the time of their original
purchase.
The definitions for "export," "exporter" and "import" are
consistent with the definitions in the regulations promulgated
to implement section 604 (57 FR 33754, 33788, July 30, 1992).
The term "import" excludes two situations. First, where ships
temporarily off-load containers and products that would otherwise
be subject to this rule, no import is considered to have occurred.
Containers containing class I or class II substances that originate
from the United States, are temporarily held in Mexico in bond
and are returned to the United States are also not included
in the definition of import. The term "importer" is consistent
with the definition in the proposed rule for the accelerated
phaseout of controlled substances, pursuant to section 606 of
the Act, which is being published concurrently with this
rulemaking.
"Interstate commerce" is defined as the distribution, or
transportation
of any product between one state, territory, possession, territory
or the District of Columbia and another state, territory,
possession
or the District of Columbia, or the sale, use or manufacture
of any product in more than one state, territory, possession
or the District of Columbia. The entry points into interstate
commerce for products that are in interstate commerce or will
enter into interstate commerce have been revised to include
the manufacturer's facility (where a manufacturer has no warehouse)
from which a product is released for distribution, sale or use.
The definition is also revised to specify that the entry of
a product into the warehouse owned by the manufacturer of that
product is an "introduction into interstate commerce." EPA received
extensive comments regarding the economic and logistical burden
of labeling all products in inventory made prior to this date.
EPA has revised its definition of "introduction into interstate
commerce," for "products manufactured with" and "products
containing"
controlled substances, EPA defines "introduction into interstate
commerce" to be either the entry of such products into the
warehouse
from which a domestic manufacturer releases the product for
shipment, the release of such products or containers by the
manufacturer from its manufacturing facility where the manufacturer
does not own a warehouse, and in the case of imports, at the
site of U.S. Customs clearance. This change in the definition
of "introduction into interstate commerce" should significantly
lessen the need to label products in inventory as of May 15,
1993. The reasons and justifications for this "grandfather"
provision are discussed in section V.B above. Paragraph (a)
of this section has been revised to reflect the "grandfathering"
of these products.
The definitions for "distributor," "wholesaler" and "retailer"
below convey those commercial entities required to pass a warning
statement on all such labeled products through the stream of
commerce to the ultimate consumer. The proposed rule did not
define these entities; however, they are covered under the
regulation.
The definition of "distributor" is consistent with the definition
promulgated in regulations implementing section 610 of the Act.
The definitions for "retailer" and "wholesaler" have been defined
in order to clarify the entities responsible for compliance
with the regulations promulgated in this rulemaking.
The term "product containing" has been added to the regulation
to mean a product, which includes containers, vessels, and pieces
of equipment, that physically holds a class I substance at the
point of sale to the ultimate consumer remains within the product
for its intended use.
As discussed above, EPA has defined a second category of
printed information on products in addition to "supplemental
printed material." The second category is "promotional printed
materials," and includes brochures, flyers, written advertisements,
catalogues, circulars, desk references, fact sheets, and similar
materials. These materials typically do not accompany the product
through to the sale to the consumer or ultimate consumer.
Supplemental
printed material was revised to exclude promotional printed
materials from its definition; supplemental information is
information
that accompanies a product at the time of purchase. Promotional
printed material is suggested as a final option in the case
where the alternative labeling placement options discussed earlier
are not appropriate because a product is available through ordering
systems only. The options for placement in these circumstances
are discussed further in 82.108 of the regulation.
E. Warning Statement Requirements (Section 82.106)
This section contains the warning statement, which by law,
must be applied to those products or containers identified in
82.102 (a) or (b) of the regulation. It also emphasizes that
the label must not detract from, interfere with or mar existing
labels required on a product's PDP. This section is amended
to exempt from the labeling requirements: (1) Products containing
trace quantities of unintended residues or impurities of controlled
substances; (2) products covered by the use reduction exemption;
(3) products manufactured for export only; (4) products undergoing
repair; and, (5) products or processes undergoing research and
development.
F. Placement of Warning Statement (Section 82.108)
This section describes the various locations where the label
may appear in order to satisfy the requirement. The options
for labeling and label placement in the proposed rulemaking
were unclear to many commenters. It is EPA's intention today
to clarify the options for label placement. The overriding
requirement
is for the warning statement to be "conspicuous and clearly
legible" by consumers at the time of purchase. A manufacturer
may clearly comply with the requirement by placing the label
on its product's principle display panel (PDP). Other means
of complying would be to label the outer packaging of the product
if the consumer could clearly view the label on such packaging.
Alternative placement options such as alternative labels (hang
tags, cards, tape, etc.) and supplemental printed materials
(invoices, bills of lading, MSDS', etc.) may also fulfill the
requirements. When a product is not viewed at the time of purchase,
such as a product purchased through mail or telephone orders,
use of promotional printed materials is another option. An
alternative
to using promotional printed information for products which
are not viewed at the time of purchase is the direct labeling
of a product or its accompanying printed information, defined
as supplemental printed information above, so that the consumer
views the warning statement at the time of product delivery.
This alternative is only available where a product can be returned
after delivery or if the purchase is not complete until the
time of delivery.
In paragraph (a) of this section, EPA defines the PDP as
a placement option that meets the requirements of the law; however,
a company may choose to label the packaging on any display panel
so long as the label is clearly legible and conspicuous at the
time of purchase; to apply the label on outer packaging under
paragraph (b) of this section; or to use the alternative labeling
options indicated in paragraph (c) of this section. In paragraph
(b) "Outer packaging" of this section, the regulatory text is
amended to include "warning statement" rather than "warning
label," due to the fact that some manufacturers may choose to
have the warning text printed directly on the packaging rather
than on a label.
Paragraph (c) "Alternative placement" of this section, is
amended to include the term "supplemental printed material,"
which is information that accompanies the product and that the
consumer, or ultimate consumer views at the time of purchase.
The text is amended to read "warning statement" rather than
"warning label," in recognition that manufacturers may choose
to include the warning text in the product's literature with
the other product information instead of applying an actual
label. The addition of the phrase "or accompanies the product
or container" enables companies to meet the requirements without
having to attach the label to the product when options discussed
in paragraph (c) of this section are used. Containers larger
than 55 gallon drums are given the option of using supplemental
printed material for label placement, since consumers usually
view supplemental information rather than the actual vessel
itself, at the time of purchase.
Finally, paragraph (d) of this section cites two new methods
that companies may use if they are unable to meet the labeling
requirements in the other paragraphs of 82.108, because they
distribute or sell their products through a phone or mail ordering
system. Under the first option, a company may include the warning
statement on promotional printed material. Under the second
option, a company may place the warning statement such that
it is conspicuous and clearly legible at the time of product
delivery as long as the product may be returned after delivery
or the purchase is not completed until delivery is accepted
(e.g., COD orders). Under this option, the company may meet
the requirement that the warning statement be conspicuous and
clearly legible by placing the statement on a display panel,
or outer packaging or by using the options for alternative
placement
as described in paragraphs (a), (b), or (c). This paragraph
replaces the paragraph on "supplemental printed material,"
indicated
in the proposed rulemaking.
G. Form of Label Bearing the Warning Statement (Section 82.110)
This section indicates the criteria by which a label is judged
to be "clearly legible." EPA retains paragraphs (a)(1) and (a)(2)
as they appeared in the proposed rulemaking. They specify the
typography, layout, and color combination guidelines. Paragraph
(b) "Name of Substance," remains unchanged. Paragraph (c) "Combined
statement for multiple class I substances," also remains unchanged
in this section.
In paragraph (d) "Format," the reference to the symbol, which
was not proposed, is deleted. Also in this section, the appearance
of the label text is amended so that the text appears parallel
to the surrounding text on the product's PDP, display panel,
or in the supplemental or promotional printed material, or on
other alternative placements rather than parallel to the base
on which the product rests. The remainder of this section is
unchanged.
The proposed rulemaking defined, in Table 1, the type sizes
in relation to the area of the PDP. In paragraph (f)(1) of this
section, a minor change is made to include the display panel
as the source upon which type size is based, which would include
the PDP, rather than apply solely to the PDP.
H. Removal of Label Bearing the Warning Statement (Section 82.112)
Section 82.112 of the proposal prohibited the removal of
a label bearing the warning statement except by the ultimate
consumer. The proposed section required that the label follow
a product through the stream of commerce and not be removed,
unless a manufacturer incorporated the name of a substance from
a label on a component product into the label for the
manufacturer's
final product. Paragraph (a) of this section remains unchanged
except that it now references a new paragraph (c) in this section.
Paragraph (b) is amended to clarify that a warning statement
on a product that is being incorporated into another product
may be removed by the purchasing manufacturer if that information
is then incorporated into the warning statement accompanying
the subsequent product or if the exemption under paragraph (c)
applies. In a new paragraph (c) of this section, an exemption
is permitted for a manufacturer who incorporates into its own
product a labeled product manufactured by another company using
controlled substances. If the manufacturer uses a controlled
substance in the manufacturing of its final product or in the
manufacturing of component parts it makes, a label must accompany
the product reflecting those substances it used.
I. Compliance by Manufacturers and Importers With Requirements
for Labeling of Containers of Controlled Substances, or Products
Containing Controlled Substances (Section 82.114)
This section is added to the final rule to distinguish the
revised pass-through requirement applicable to "products
containing"
controlled substances and "containers containing" controlled
substances from that applicable to products manufactured with
such substances. The proposed rule did not make a distinction
because the warning statement was required to be passed through
the stream of commerce to the ultimate consumer for all products
manufactured with controlled substances, products containing
controlled substances, or containers containing controlled
substances.
Labels on a product being incorporated into an final product
were required to be incorporated into the new label accompanying
the product to the ultimate consumer.
In today's final rule, this section requires that for all
products containing controlled substances and containers containing
controlled substances, a label must still be passed through
the stream of commerce to the ultimate consumer. If a "product
containing" a controlled substance is incorporated into another
product, the final product must bear a new warning statement
incorporating the information on the incorporated products'
warning statement. Paragraph (b), "Reliance on Reasonable Belief,"
is changed to clarify the responsibilities of importers that
import products that are incorporated into their own products.
Importers that introduce foreign products into interstate commerce
must have a reasonable belief that the import is properly labeled
or does not require a warning statement at the site of Customs
clearance. Under no circumstances may an importer remove a label
from a container of a controlled substance or a product containing
controlled substances, unless the container or product is
incorporated
into a new container or product and the label information
accompanying
the first container or product is then incorporated into a new
label on the final product. Paragraph (c), "Contractual
obligations,"
states that importers may use contractual obligations to show
evidence of reasonable belief in determining whether the products
manufactured abroad are accurately labeled.
J. Compliance by Manufacturers of Products Manufactured With
Controlled Substances (Section 82.116)
This section has been changed to describe the revised pass-
through requirement for products manufactured with controlled
substances as discussed earlier. It also clarifies the treatment
of imports. Any importer that introduces foreign products into
interstate commerce must ensure that the product is properly
labeled, unless the importer has a reasonable belief that the
import does not require a warning statement pursuant to 82.102
of the regulation at the site of Customs clearance. Products
of foreign incorporated companies manufacturing products
"manufactured
with" controlled substances are subject to the requirements
of this subpart if they are imported as defined above. Paragraph
(c), "Contractual obligations," states that importers may use
contractual obligations to show evidence of reasonable belief
that the products manufactured by foreign manufacturers and
suppliers are properly labeled.
K. Compliance by Wholesalers, Distributors and Retailers (Section
82.118)
This section describes the responsibilities of distributors,
wholesalers and retailers who must pass the label through from
their suppliers of products or containers containing or products
manufactured with controlled substances to the ultimate consumer.
The section remains unchanged.
L. Recoverable Substances Label (Section 82.120)
This section is deleted.
M. Petitions (Section 82.120)
This new 82.120 describes in detail the process by which
a petitioner may submit a petition to exempt a product manufactured
with a class I substance from the labeling requirements, or
to apply the labeling requirements to a product containing or
manufactured with a class II substance. It also explains the
procedures by which the Agency will review and evaluate the
petitions and the criteria upon which the Agency will base its
final determinations. The section remains unchanged.
N. Certification, Recordkeeping and Notice Requirements (Section
82.122)
This section has been added to indicate what procedures are
required for persons wishing to claim an exemption from labeling
of products manufactured with CFC-113 and methyl chloroform
based on the "reduced use exemption," as provided in 82.106(b)(2).
O. Prohibitions (Section 82.124)
Paragraph (a)(1)(i) of this section states that, effective
May 15, 1993, no product or container identified in 82.102(a)
may enter into interstate commerce unless it bears a warning
statement that is consistent with 82.106, or unless the product
is temporarily exempted from the labeling requirements as having
no potential substitutes pursuant to 82.120. Paragraph (a)(1)(i)
has been amended to note that the following products or containers
do not require labeling: products manufactured before May 15,
1993, which are "grandfathered" under 82.102(c); products
containing
only trace quantities of a controlled substance, which are exempted
from the labeling requirements under 82.106(b)(1); products
that fall under the reduced use exemption of 82.106(b)(2);
products intended for export only, which are exempted under
82.106(b)(3); products that are under repair, which are exempted
under 82.106(b)(4); products undergoing research and development,
which are exempted under 82.106(b)(5). This section has also
been amended to indicate: (1) That manufacturers who incorporate
products purchased from other manufacturers, where such
incorporated
products have been manufactured with controlled substances,
are exempt from the prohibition on removal of the warning
statement,
under 82.112(c); and (2) that manufacturers and importers are
not required to pass through and incorporate the information
that accompanies the incorporated products, pursuant to 82.116(a).
The placement of the label for products identified in 82.102(a)
must comply with 82.108, unless the product is temporarily
exempted pursuant to 82.120. Paragraph (a)(2)(1) has been amended
to indicate the exclusions under 82.102(c), 82.106(b), 82.112(c),
and 82.116(a) discussed above. Such products must bear the warning
statement pursuant to 82.110, unless the label is temporarily
exempted pursuant to 82.120. Paragraph (a)(3)(i) has been amended
to indicate that such labeling is not required if the product
is not required to bear a label pursuant to 82.102(c), 82.106(b),
82.112(c) or 82.116(a).
Similar provisions apply to products manufactured with or
containing class II substances, as indicated in 82.102(b),
except that the effective date of the rules as they apply to
such products is January 1, 2015, or at any time after May 15,
1993 that the Administrator finds for a certain product that
substitute products or processes are potentially available.
Also, the exclusions discussed above under 82.102(c), 82.106(b)(2)
and 82.120 are inapplicable to such products.
A new paragraph (a)(5) has been added to this section to
indicate the effective date of these prohibitions for effected
"products manufactured with" and "products and containers
containing"
newly listed substances.
Paragraph (b), which referred to the recoverable substances
label, is deleted from this section, as that label is no longer
required.
VII. Effective Date
The effective date for the labeling requirements in the final
rule remains unchanged; section 611 of the Clean Air Act
specifically
states that the labeling requirements for products manufactured
with class I substances, products containing class I substances,
and containers containing class I or class II substances are
effective 30 months following the enactment of the law, or May
15, 1993. The labeling of products "manufactured with" and
"containing"
class II substances is required beginning January 1, 2015.
(Labeling
of particular products manufactured with or containing class
II substances may be required before January 1, 2015, if the
Administrator determines, after notice and opportunity for comment,
that adequate substitutes are available. This rulemaking does
not include any such determinations.) EPA does not have the
authority under section 611 to revise the effective dates.
EPA recognizes the practical problems the regulated community
will have in meeting the May 15, 1993 deadline for labeling
of products and containers containing class I substances, products
manufactured with class I substances and containers of class
II substances, given the late publication of this rule. The
Agency recognizes that Congress intended in section 611 that
there be one year between promulgation of these regulations
and the effective date of the labeling requirements, and that
these final regulations have been promulgated over eight months
later than Congress intended. The Agency also realizes, based
on the comments it has received and its own information relating
to the complexity of implementing these labeling requirements,
that most manufacturers will need as long as nine months after
the date of publication of this rule to comply with these
requirements.
As a result of these concerns, it is the Agency's policy to
take no enforcement action for matters occurring during the
first nine months following the publication of these regulations.
The applicability section of the regulations also provides
that the effective date of the labeling requirements as they
apply to substances listed as class I or class II substances
after the promulgation of the regulation will be as provided
in the final rule listing the substances, but will in no case
be longer than one year after listing. EPA believes that
manufacturers
will need some amount of lead time after a substance is newly
listed before it can comply with the labeling regulations. However,
section 611 appears to indicate that the labeling requirements
must become applicable one year after listing, at the latest.
Section 611 does not, on its face, address the treatment
of newly listed substances. However, its provision for one year
of lead time between the date of promulgation of these regulations
and the effective date of the labeling requirements, and in
the case of products manufactured subject to the labeling
requirements
through the petition process indicates that Congress intended
manufacturers to have some lead time before the requirements
took effect. EPA will therefore determine the appropriate effective
date for newly listed substances upon listing them.
VIII. Summary of Supporting Analyses
A. Regulatory Impact Analysis
Executive Order No. 12291 requires the preparation of a
regulatory
impact analysis for major rules, defined by the order as those
likely to result in:
(1) An annual effect on the economy of $100 million or more;
(2) A major increase in costs or prices for consumers,
individual
industries, Federal, state or local government agencies, or
geographic industries; or
(3) Significant adverse effects on competition, employment,
investment, productivity, innovation, or on the ability of the
United States-based enterprises to compete with foreign-based
enterprises in domestic or export markets.
The Agency has determined that this regulation does not meet
the definition of a major rule under E.O. 12291 and has therefore
not prepared a formal regulatory impact analysis. EPA has instead
prepared a detailed background economic analysis which estimates
and compares the costs and benefits of the regulation, using
the accelerated phaseout as a baseline. There is also a discussion
of the latest developments of the Montreal Protocol based on
the Fourth Meeting of the Parties in Copenhagen in November
1992.
Based on many revisions to the proposed rule, labeling costs
have significantly been reduced, such as the revised label pass-
through requirement, which greatly affects the solvent-cleaning
sector, a broadening of label placement options, exemptions
for expanded incidental uses of ozone-depleting substances and
a 95% reduced use exemption provision.
In the background economic analysis document, the Agency
provides estimates of the potential costs and benefits in monetary
terms; however, these may not represent all of the potential
costs and benefits of the labeling regulation. The costs and
benefits are expected to correspond relative to one another;
in other words, the higher the benefits, the higher the costs.
For example, if consumers choose not to purchase products with
warning statements, there could be a corresponding decrease
in the use of ozone-depleting substances. If manufacturers
anticipate
a significant decline in profits due to labeling, they may choose
to reformulate or redesign their products in order to eliminate
their use of ozone-depleting substances in their manufacturing
processes. They would therefore avoid having to label their
products. In this case, costs associated with reformulation
or redesigning will increase, while costs of labeling will
decrease.
If manufacturers decide to label their products, only the costs
of labeling will be incurred. Benefits will occur when companies
reformulate their products or manufacturing processes to avoid
labeling due to the reduction in use of ozone-depleting substances.
The Agency estimates that the total cost of labeling products
to be $179.3 million per year (see docket, "Regulatory Impact
Analysis of the Rule Requiring Labeling of Products Containing
or Manufactured with Ozone-Depleting Substances," Chapter 5,
"Comparison of Costs and Benefits"), based on 1992 dollars.
It further estimated that the costs of reformulation or redesigning
will total $292.8 million at a 7% discount rate, and $351.7
million at a 2% discount rate. The total costs in 1992 dollars,
applying both discount rates, would be $472.1 million and $531
million respectively.
The total annualized costs at the 7% discount rate would
total $180 million over three years and, $184 million at the
2% discount rate.
The benefits for labeling are based on a per kilogram value
of $1.00 per year through the year 2075, as established in the
Phaseout RIA for the regulation implementing section 604 of
the Act (57 FR 33788, July 31, 1992). The benefits of reducing
the emissions of methyl chloroform attributed to product
reformulations
are estimated to entail a value range of $27.2 million to $180.9
million, at a 7% discount rate, and $190.5 million to $720.2
million at a 2% discount rate. The annualized benefits associated
with the reduced emissions of ozone-depleting substances as
a result of decreased sales of labeled products are estimated,
using both discount rates, at $41.55 million and $273.8 million
respectively.
The total annualized benefits are estimated therefore to
range from $5 million to $11 million over about 75 years at
a 7% discount rate, and $12 million to $25 million over the
same period of time at a 2% discount rate.
B. Regulatory Flexibility Analysis
The Regulatory Flexibility Act, 5 U.S.C. 601-612, requires
that Federal agencies examine the impacts of their regulations
on small entities. Under 5 U.S.C. 604(a), whenever the Agency
is required to publish a general notice of proposed rulemaking,
it must prepare and make available for public comment an initial
Regulatory Flexibility Analysis (RFA). Such an analysis is not
required if the head of an Agency certifies that a rule will
not have a significant economic impact on a substantial number
of small entities, pursuant to 5 U.S.C. 605(b).
The Agency believes that the regulation will not have a
significant
impact on a substantial number of small entities and has concluded,
as a result, that a formal RFA is not necessary. Instead, EPA
has prepared an informal analysis of the impact on small entities
in the background economic document (see docket). The Agency
considered an across-the-board exemption for small entities,
but made the final determination that section 611 does not
authorize
an exemption since Congress made no indication of such. In
addition,
the Agency considered an extension of one year for small entities;
however, the final determination was made that Congress prescribed
an effective date of May 15, 1993 which is inflexible to
extensions.
Nevertheless, despite these decisions, EPA believes that all
businesses will find the costs of the rule minimized due to
several key amendments to the labeling requirements described
above. The "grandfather" provision for inventory, the revised
label pass-through requirement for products manufactured with
class I substances, and several exemptions related to ozone-
depleting substance use are some of the key changes to the proposed
rule which will reduce the tracking, time and cost burdens
associated
with the proposal that small businesses would otherwise face.
EPA concludes that these changes to the labeling requirements
do not warrant a formal regulatory flexibility analysis for
the final rule. Similar to the draft RIA for the NPRM, this
document analyzes the impacts on companies based on their size
of annual sales.
C. Paperwork Reduction Act
The information collection requirements in this rule have
been submitted for approval to the Office of Management and
Budget (OMB) under the Paperwork Reduction Act, 44 U.S.C. 3501
et seq. These requirements are not effective until OMB approves
them and a technical amendment to that effect is published in
the Federal Register.
Public reporting burden for this collection of information
is estimated to vary from 5 to 12 hours per response with an
average of 8 hours per response, including time for reviewing
instructions, searching existing data sources, gathering and
maintaining the data needed, and completing the collection of
information.
Send comments regarding the burden estimate or any other
aspect of this collection of information, including suggestions
for reducing this burden to Chief, Information Policy Branch,
PM-223Y, US EPA, 401 M Street, SW., Washington, DC 20460; and
to the Office of Information and Regulatory Affairs, Office
of Management and Budget, Washington, DC 20503, marked "Attention:
Desk Officer for EPA." The Agency will respond to any OMB or
public comments on the information collection request.
IX. References
Federal Trade Commission. Staff Report on the Cigarette
Advertising
Investigation (1981)
Rudd, Joel. "Aiding Consumer Nutrition Decisions with the
Simple Graphic Label Format." Home Economics Research Journal
(March, 1986).
The Green Report: Findings and Preliminary Recommendations
for Responsible Environmental Advertising. Ten State Task Force
of Attorneys General (November, 1990).
The Green Report II: Recommendations for Responsible
Environmental
Advertising. Ten-State Task Force of Attorneys General (May,
1991).
United Nations Environmental Programme. Ad-Hoc Technical
Advisory Committee on ODS Destruction Technologies.
United Nations Environmental Programme. Electronics, Degreasing
and Dry Cleaning Solvents: Technical Options Report (June 30,
1989).
United Nations Environmental Programme. Report of the Fourth
Meeting of the Parties to the Montreal Protocol on Substances
that Deplete the Ozone Layer (November 25, 1992).
United Nations Environmental Programme. Solvents, Coatings
and Adhesives: Technical Options Committee Report (December,
1991).
United Nations Environmental Programme. Scientific Assessment
of Ozone Depletion: 1991 December 17, 1991).
United Nations Environmental Programme. Third Meetings of
the Parties to the Montreal Protocol on Substances that Deplete
the Ozone Layer: UNEP/OzL.Pro.3/L.4/Add.4 (Nairobi, 19-21 June,
1991).
United States Department of Commerce, National Bureau of
Standards. The Development of Effective Symbol Signs (1982).
United States Department of Health and Human Service, Food
and Drug Administration. Compliance Costs of Food Labeling
Regulations
(1991).
United States Environmental Protection Agency. Manual of
Practices to Reduce and Eliminate CFC-113 Use in the Electronics
Industry (March, 1990).
List of Subjects in 40 CFR Part 82 Administrative practice and
procedure
Air pollution control, Chemicals, Chloroflourocarbons, Exports,
Imports, Interstate commerce, Pass-through requirement, Reporting
and recordkeeping requirements, Stratospheric ozone layer.
Dated: January 19, 1993.
William K. Reilly,
Administrator.
Title 40, Code of Federal Regulations, part 82, is amended
to read as follows:
PART 82-PROTECTION OF STRATOSPHERIC OZONE
1.The authority citation for part 82 continues to read as
follows:
Authority: 42 U.S.C. 7414, 7601, 7671-7671(q).
2.A new subpart E is added to read as follows:
Subpart E-The Labeling of Products Using Ozone-Depleting Substances
Sec.
82.100 Purpose.
82.102 Applicability.
82.104 Definitions.
82.106 Warning statement requirements.
82.108 Placement of warning statement.
82.110 Form of label bearing warning statement.
82.112 Removal of label bearing warning statement.
82.114 Compliance by manufacturers and importers with requirements
for labeling of containers of controlled substances, or
products containing, controlled substances.
82.116 Compliance by manufacturers or importers incorporating
products manufactured with controlled substances.
82.118 Compliance by wholesalers, distributors and retailers.
82.120 Petitions.
82.122 Certification, recordkeeping, and notice requirements.
82.124 Prohibitions.
Subpart E-The Labeling of Products Using Ozone-Depleting Substances
82.100 Purpose.
The purpose of this subpart is to require warning statements
on containers of, and products containing or manufactured with,
certain ozone-depleting substances, pursuant to section 611
of the Clean Air Act, as amended.
82.102 Applicability.
(a) In the case of substances designated as class I or class
II substances as of February 11, 1993, the requirements in this
paragraph are applicable beginning on May 15, 1993. In the case
of any substance designated as a class I or class II substance
after February 11, 1993, the requirements in this paragraph
of this section are applicable beginning either one year after
the effective date of such designation or the date provided
in the rulemaking designating such substance as a class I or
class II substance, whichever comes first. On the applicability
date indicated above, the requirements of this subpart shall
apply to the following containers and products except as exempted
under paragraph (c) of this section:
(1) All containers in which a class I or class II substance
is stored or transported.
(2) All products containing a class I substance.
(3) All products directly manufactured with a process that
uses a class I substance, unless otherwise exempted by this
subpart or, unless the Administrator determines for a particular
product that there are no substitute products or manufacturing
processes for such product that do not rely on the use of a
class I substance, that reduce overall risk to human health
and the environment, and that are currently or potentially
available.
If the Administrator makes such a determination for a particular
product, then the requirements of this subpart are applicable
for such product no later than January 1, 2015.
(b) Beginning on January 1, 2015 in any case, or one year
after any determination between May 15, 1993 and January 1,
2015, by the Administrator for a particular product that there
are substitute products or manufacturing processes for such
product that do not rely on the use of a class I or class II
substance, that reduce the overall risk to human health and
the environment, and that are currently or potentially available,
the requirements of this subpart shall apply to the following:
(1) All products containing a class II substance.
(2) All products manufactured with a process that uses a
class II substance.
(c) The requirements of this subpart shall not apply to products
manufactured prior to May 15, 1993, provided that the manufacturer
submits documentation to EPA upon request showing that the product
was manufactured prior to that date.
82.104 Definitions.
(a) Class I substance means any substance designated as class
I in 40 CFR part 82, appendix A to subpart A, including
chlorofluorocarbons,
halons, carbon tetrachloride and methyl chloroform and any other
substance so designated by the Agency at a later date.
(b) Class II substance means any substance designated as
class II in 40 CFR part 82, appendix A to subpart A, including
hydrochlorofluorocarbons and any other substance so designated
by the Agency at a later date.
(c) Consumer means a commercial or non-commercial purchaser
of a product or container that has been introduced into interstate
commerce.
(d) Container means the immediate vessel in which a controlled
substance is stored or transported.
(e) Container containing means a container that physically
holds a controlled substance within its structure that is intended
to be transferred to another container, vessel or piece of
equipment
in order to realize its intended use.
(f) Controlled substance means a class I or class II ozone-
depleting substance.
(g) Distributor means a person to whom a product is delivered
or sold for purposes of subsequent resale, delivery or export.
(h) Export means the transport of virgin, used, or recycled
class I or class II substances or products manufactured or
containing
class I or class II substances from inside the United States
or its territories to persons outside the United States or its
territories, excluding United States military bases and ships
for on-board use.
(i) Exporter means the person who contracts to sell class
I or class II substances or products manufactured with or
containing
class I or class II substances for export or transfers such
substances or products to his affiliate in another country.
(j) Import means to land on, bring into, or introduce into,
or attempt to land on, bring into, or introduce into any place
subject to the jurisdiction of the United States whether or
not such landing, bringing, or introduction constitutes an
importation
within the meaning of the customs laws of the United States,
with the following exceptions:
(1) Temporary off-loading of products manufactured with or
containers containing class I or class II substances from a
ship are used for servicing of that ship, and
(2) Bringing containers of class I or class II substances
or products containing or manufactured with class I or class
II substances into the U.S. from Mexico where the class I or
class II substance or container or product had been admitted
into Mexico in bond and is of U.S. origin.
(k) Importer means any person who imports a controlled
substance,
a product containing a controlled substance, or any other chemical
substance (including a chemical substance shipped as part of
a mixture or article), into the United States. "Importer" includes
the person primarily liable for the payment of any duties on
the merchandise or an authorized agent acting on his or her
behalf. The term also includes, as appropriate:
(1) The consignee,
(2) The importer of record listed on U.S. Customs Service
forms for the import,
(3) The actual owner if an actual owner's declaration and
superseding bond has been filed; or
(4) The transferee, if the right to draw merchandise in a
bonded warehouse has been transferred.
(l) Interstate commerce means the distribution or transportation
of any product between one state, territory, possession or the
District of Columbia, and another state, territory, possession
or the District of Columbia, or the sale, use or manufacture
of any product in more than one state, territory, possession
or District of Columbia. The entry points for which a product
is introduced into interstate commerce are the release of a
product from the facility in which the product was manufactured,
the entry into a warehouse from which the domestic manufacturer
releases the product for sale or distribution, and at the site
of United States Customs clearance.
(m) Manufactured with a controlled substance means that the
manufacturer of the product itself used a controlled substance
directly in the product's manufacturing, but the product itself
does not contain the controlled substance at the point of
introduction
into interstate commerce. The following situations are excluded
from the meaning of the phrase "manufactured with" a controlled
substance:
(1) Where a product has not had physical contact with the
controlled substance; or
(2) Where the manufacturing equipment has had physical contact
with a controlled substance in an intermittent manner, not as
a routine part of the direct manufacturing process; or
(3) Where the controlled substance has been transformed,
except for trace quantities.
(n) Potentially available means that adequate information
exists to make a determination that the substitute is
technologically
feasible, environmentally acceptable and economically viable.
(o) Principal display panel (PDP) means the entire portion
of the surface of a product, container or its outer packaging
that is most likely to be displayed, shown, presented, or examined
under customary conditions of retail sale. The area of the PDP
is not limited to the portion of the surface covered with existing
labeling; rather it includes the entire surface, excluding flanges,
shoulders, handles, or necks.
(p) Product means an item or category of items manufactured
from raw or recycled materials, or other products, which is
used to perform a function or task.
(q) Product containing means a product including, but not
limited to, containers, vessels, or pieces of equipment, that
physically holds a controlled substance at the point of sale
to the ultimate consumer which remains within the product.
(r) Promotional printed material means any informational
or advertising material (including, but not limited to, written
advertisements, brochures, circulars, desk references and fact
sheets) that is prepared by the manufacturer for display or
promotion concerning a product or container, and that does not
accompany the product to the consumer.
(s) Retailer means a person to whom a product is delivered
or sold, if such delivery or sale is for purposes of sale or
distribution in commerce to consumers who buy such product for
purposes other than resale.
(t) Supplemental printed material means any informational
material (including, but not limited to, package inserts, fact
sheets, invoices, material safety data sheets, procurement and
specification sheets, or other material) which accompanies a
product or container to the consumer at the time of purchase.
(u) Transform means to use and entirely consume a class I
or class II substance, except for trace quantities, by changing
it into one or more substances not subject to this subpart in
the manufacturing process of a product or chemical.
(v) Type size means the actual height of the printed image
of each capital letter as it appears on a label.
(w) Ultimate consumer means the first commercial or
non-commercial
purchaser of a container or product that is not intended for
re-introduction into interstate commerce as a final product
or as part of another product.
(x) Warning label means the warning statement required by
section 611 of the Act. The term warning statement shall be
synonymous with warning label for purposes of this subpart.
(y) Wholesaler means a person to whom a product is delivered
or sold, if such delivery or sale is for purposes of sale or
distribution to retailers who buy such product for purposes
of resale.
82.106 Warning statement requirements.
(a) Required warning statements. Unless otherwise exempted
by this subpart, each container or product identified in 82.102(a)
or (b) shall bear the following warning statement, meeting the
requirements of this subpart for placement and form:
WARNING: Contains [or Manufactured with, if applicable] [insert
name of substance], a substance which harms public health and
environment by destroying ozone in the upper atmosphere.
(b) Exemptions from warning label requirement.
The following products need not bear a warning label:
(1) Products in which trace quantities of a controlled substance
remain as a residue or impurity due to a chemical reaction,
and where the controlled substance serves no useful purpose
in or for the product itself.
(2) Products manufactured using methyl chloroform or CFC-
113 by persons who can demonstrate and certify a 95% reduction
in overall usage from their 1990 calendar year usage of methyl
chloroform or CFC-113 as solvents during a twelve (12) month
period ending within sixty (60) days of such certification or
during the most recently completed calendar year. In calculating
such reduction, persons may subtract from quantities used those
quantities for which they possess accessible data that establishes
the amount of methyl chloroform or CFC-113 transformed. Such
subtraction must be performed for both the applicable twelve
month period and the 1990 calendar year. If at any time future
usage exceeds the 95% reduction, all products manufactured with
methyl chloroform or CFC-113 as solvents by that person must
be labeled immediately. No person may qualify for this exemption
after May 15, 1994.
(3) Products intended only for export outside of the United
States shall not be considered "products introduced into interstate
commerce" provided such products are clearly designated as intended
for export only.
(4) Products that are otherwise not subject to the requirements
of this subpart that are being repaired, using a process that
uses a controlled substance.
(5) Products, processes, or substitute chemicals undergoing
research and development, by which a controlled substance is
used. Such products must be labeled when they are introduced
into interstate commerce.
(c) Interference with other required labeling information.
The warning statement shall not interfere with, detract from,
or mar any labeling information required on the labeling by
federal or state law.
82.108 Placement of warning statement.
The warning statement shall be placed so as to satisfy the
requirement of the Act that the warning statement be "clearly
legible and conspicuous." The warning statement is clearly legible
and conspicuous if it appears with such prominence and
conspicuousness
as to render it likely to be read and understood by consumers
under normal conditions of purchase. Such placement includes,
but is not limited to, the following:
(a) Display panel placement. For any affected product or
container that has a display panel that is normally viewed by
the purchaser at the time of the purchase, the warning statement
described in 82.106 may appear on any such display panel of
the affected product or container such that it is "clearly legible
and conspicuous" at the time of the purchase. If the warning
statement appears on the principal display panel or outer packaging
of any such affected product or container, the warning statement
shall qualify as "clearly legible and conspicuous," as long
as the label also fulfills all other requirements of this subpart
and is not obscured by any outer packaging, as required by
paragraph
(b) of this section. The warning statement need not appear on
such display panel if either:
(1) The warning statement appears on the outer packaging
of the product or container, consistent with paragraph (b) of
this section, and is clearly legible and conspicuous; or
(2) The warning statement is placed in a manner consistent
with paragraph (c) of this section.
(b) Outer packaging. If the product or container is normally
packaged, wrapped, or otherwise covered when viewed by the
purchaser
at the time of the purchase the warning statement described
in 82.106 shall appear on any outer packaging, wrapping or
other covering used in the retail display of the product or
container, such that the warning statement is clearly legible
and conspicuous at the time of the purchase. If the outer packaging
has a display panel that is normally viewed by the purchaser
at the time of the purchase, the warning statement shall appear
on such display panel. If the warning statement so appears on
such product's or container's outer packaging, it need not appear
on the surface of the product or container, as long as the
statement
also fulfills all other requirements of this subpart. The warning
statement need not appear on such outer packaging if either:
(1) The warning statement appears on the surface of the product
or container, consistent with paragraph (a) of this section,
and is clearly legible and conspicuous through any outer packaging,
wrapping or other covering used in display; or
(2) The warning statement is placed in a manner consistent
with paragraph (c) of this section.
(c) Alternative placement. The warning statement may be placed
on a hang tag, tape, card, sticker, invoice, bill of lading,
supplemental printed material, or similar overlabeling that
is securely attached to the container, product, outer packaging
or display case, or accompanies the product containing or
manufactured
with a controlled substance or a container containing class
I or class II substances larger than a 55 gallon drum through
its sale to the consumer or ultimate consumer. For prescription
medical products that have been found to be essential for patient
health by the Food and Drug Administration, the warning statement
may be placed in supplemental printed material intended to be
read by the prescribing physician, as long as the following
statement is placed on the product, its packaging, or supplemental
printed material intended to be read by the patient: "This product
contains [insert name of substance], a substance which harms
the environment by depleting ozone in the upper atmosphere."
In any case, the warning statement must be clearly legible and
conspicuous at the time of the purchase.
(d) Products not viewed by the purchaser at the time of
purchase.
Where the purchaser of a product cannot view a product, its
packaging or alternative labeling such that the warning statement
is clearly legible and conspicuous at the time of purchase,
as specified under paragraphs (a), (b), or (c) of this section,
the warning statement may be placed in the following manner:
(1) Where promotional printed material is prepared for display
or distribution, the warning statement may be placed on such
promotional printed material such that it is clearly legible
and conspicuous at the time of purchase; or
(2) The warning statement may be placed on the product, on
its outer packaging, or on alternative labeling, consistent
with paragraphs (a), (b), or (c) of this section, such that
the warning statement is clearly legible and conspicuous at
the time of product delivery, if the product may be returned
by the purchaser at or after the time of delivery or if the
purchase is not complete until the time of delivery (e.g., products
delivered C.O.D.).
82.110 Form of label bearing warning statement.
(a) Conspicuousness and contrast. (1) The warning statement
shall appear in conspicuous and legible type by typography,
layout, and color with other printed matter on the label. (2)
The warning statement shall appear in sharp contrast to any
background upon which it appears. Examples of combinations of
colors which may not satisfy the proposed requirement for sharp
contrast are: black letters on a dark blue or dark green
background,
dark red letters on a light red background, light red letters
on a reflective silver background, and white letters on a light
gray or tan background.
(b) Name of substance. The name of the class I or class II
substance to be inserted into the warning statement shall be
the standard chemical name of the substance as listed in 40
CFR part 82, appendix A to subpart A, except that:
(1) The acronym "CFC" may be substituted for
"chlorofluorocarbon."
(2) The acronym "HCFC" may be substituted for
"hydrochlorofluorocarbon."
(3) The term "1,1,1-trichloroethane" may be substituted for
"methyl chloroform."
(c) Combined statement for multiple class I substances. If
a container containing or a product contains or is manufactured
with, more than one class I or class II substance, the warning
statement may include the names of all of the substances in
a single warning statement, provided that the combined statement
clearly distinguishes which substances the container or product
contains and which were used in the manufacturing process.
(d) Format. (1) The warning statement shall be blocked within
a square or rectangular area, with or without a border.
(2) The warning statement shall appear in lines that are
parallel to the surrounding text on the product's PDP, display
panel, supplemental printed material or promotional printed
material.
(e) Type style. (1) The ratio of the height of a capital
letter to its width shall be such that the height of the letter
is no more than 3 times its width.
(2) The signal word "WARNING" shall appear in all capital
letters.
(f) Type size. The warning statement shall appear at least
as large as the type sizes prescribed by this paragraph. The
type size refers to the height of the capital letters. A larger
type size materially enhances the legibility of the statement
and is desirable.
(1) Display panel or outer packaging. Minimum type size
requirements
for the warning statement are given in Table 1 and are based
upon the area of the display panel of the product or container.
Where the statement is on outer packaging, as well as the display
panel area, the statement shall appear in the same minimum type
size as on the display panel.
Table 1
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÂÄÄÄÄÄÄÄÄÄÄÂÄÄÄÄÄÄÄÄÄÄÂÄÄÄÄÄÄÄÄÄÄÂÄÄÄÄÄÄÄÄÄÄÂÄÄÄÄÄÄÄÄÄÄÂÄÄÄÄÄÄÄÄÄÄÄÄ
Area of display ³ 0-2 ³ >2-5 ³
>5-10 ³ >10-15 ³ >15-30 ³ >30
panel (sq.in.) ³ ³ ³
³ ³ ³
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÅÄÄÄÄÄÄÄÄÄÄÅÄÄÄÄÄÄÄÄÄÄÅÄÄÄÄÄÄÄÄÄÄÅÄÄÄÄÄÄÄÄÄÄÅÄÄÄÄÄÄÄÄÄÄÅÄÄÄÄÄÄÄÄÄÄÄÄ
³ ³ ³
³ ³ ³
Type size (in.){1} ³ ³ ³
³ ³ ³
: ³ ³ ³
³ ³ ³
Signal word ..... ³ 3/64 ³ 1/16 ³ 3/32
³ 7/64 ³ 1/8 ³ 5/32
Statement........ ³ 3/64 ³ 3/64 ³ 1/16
³ 3/32 ³ 3/32 ³ 7/64
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÁÄÄÄÄÄÄÄÄÄÄÁÄÄÄÄÄÄÄÄÄÄÁÄÄÄÄÄÄÄÄÄÄÁÄÄÄÄÄÄÄÄÄÄÁÄÄÄÄÄÄÄÄÄÄÁÄÄÄÄÄÄÄÄÄÄÄÄ
> means greater than
{1} minimum height of printed image of letters
(2) Alternative placement. The minimum type size for the
warning statement on any alternative placement which meets the
requirements of 82.108(c) is 3/32 inches for the signal word
and 1/16 of an inch for the statement.
(3) Promotional printed material. The minimum type size for
the warning statement on promotional printed material is 3/32
inches for the signal word and 1/16 of an inch for the statement,
or the type size of any surrounding text, whichever is larger.
82.112 Removal of label bearing warning statement.
(a) Prohibition on removal. Except as described in paragraph
(b) or (c) of this section, any warning statement that accompanies
a product or container introduced into interstate commerce,
as required by this subpart, must remain with the product or
container and any product incorporating such product or container,
up to and including the point of sale to the ultimate consumer.
(b) Incorporation of warning statement by subsequent
manufacturers.
A manufacturer of a product that incorporates a product that
is accompanied by a label bearing the warning statement may
remove such label from the incorporated product if the information
on such label is incorporated into a warning statement accompanying
the manufacturer's product, or if, pursuant to paragraph (c)
of this section, the manufacturer of the product is not required
to pass through the information contained on or incorporated
in the product's label.
(c) Manufacturers that incorporate products manufactured
with controlled substances. A manufacturer that incorporates
into its own product a component product that:
(1) Was purchased from another manufacturer;
(2) Was manufactured with a process that uses a controlled
substance(s); but
(3) Does not contain such substance(s), may remove such label
from the incorporated product and need not apply a warning
statement
to its own product, if the manufacturer does not use a controlled
substance in its own manufacturing process.
A manufacturer that uses controlled substances in its own
manufacturing process, and is otherwise subject to the regulations
of this subpart, must label pursuant to 82.106, but need not
include information regrading the incorporated product on the
required label.
82.114 Compliance by manufacturers and importers with
requirements
for labeling of containers of controlled substances, or products
containing controlled substances.
(a) Compliance by manufacturers and importers with requirements
for labeling of containers of controlled substances, or products
containing controlled substances. Each manufacturer of a product
incorporating another product or container containing a controlled
substance, to which 82.102 (a)(1), or, (a)(2) or (b)(1) applies,
that is purchased or obtained from another manufacturer or
supplier,
is required to pass through and incorporate the labeling
information
that accompanies such incorporated product in a warning statement
accompanying the manufacturer's finished product. Each importer
of a product, or container containing a controlled substance,
to which 82.102 (a)(1), (a)(2), or (b)(1) applies, including
a component product or container incorporated into the product,
that is purchased from a foreign manufacturer or supplier, is
required to apply a label, or to ensure that a label has been
properly applied, at the site of U.S. Customs clearance.
(b) Reliance on reasonable belief. The manufacturer or importer
of a product that incorporates another product containing from
another manufacturer or supplier may rely on the labeling
information
(or lack thereof) that it receives with the product, and is
not required to independently investigate whether the requirements
of this subpart are applicable to such purchased product or
container, as long as the manufacturer reasonably believes that
the supplier or foreign manufacturer is reliably and accurately
complying with the requirements of this subpart.
(c) Contractual obligations. A manufacturer's or importer's
contractual relationship with its supplier under which the supplier
is required to accurately label, consistent with the requirements
of this subpart, any products containing a controlled substance
or containers of a controlled substance that are supplied to
the manufacturer or importer, is evidence of reasonable belief.
82.116 Compliance by manufacturers or importers incorporating
products manufactured with controlled substances.
(a) Compliance by manufacturers or importers incorporating
products manufactured with controlled substances, or importing
products manufactured with controlled substances. Each manufacturer
or importer of a product incorporating another product to which
82.102 (a)(3), or, (b)(2) applies, that is purchased from another
manufacturer or supplier, is not required to pass through and
incorporate the labeling information that accompanies such
incorporated
product in a warning statement accompanying the manufacturer's
or importer's finished product. Importers of products to which
82.102 (a)(3) or (b)(2) applies are required to apply a label,
or to ensure that a label has been properly applied at the site
of U.S. Customs clearance.
(b) Reliance on reasonable belief. The importer of a product
purchased or obtained from a foreign manufacturer or supplier,
which product may have been manufactured with a controlled
substance,
may rely on the information that it receives with the purchased
product, and is not required to independently investigate whether
the requirements of this subpart are applicable to the purchased
or obtained product, as long as the importer reasonably believes
that there was no use of controlled substances by the final
manufacturer of the product being imported.
(c) Contractual obligations. An importer's contractual
relationship
with its supplier under which the supplier is required to
accurately
label, consistent with the requirements of this subpart, any
products manufactured with a controlled substance that are supplied
to the importer, or to certify to the importer whether a product
was or was not manufactured with a controlled substance is evidence
of reasonable belief.
82.118 Compliance by wholesalers, distributors and retailers.
(a) Requirement of compliance by wholesalers, distributors
and retailers. All wholesalers, distributors and retailers of
products or containers to which this subpart applies are required
to pass through the labeling information that accompanies the
product.
(b) Reliance on reasonable belief. The wholesaler, distributor
or retailer of a product may rely on the labeling information
that it receives with the product or container, and is not required
to independently investigate whether the requirements of this
subpart are applicable to the product or container, as long
as the wholesaler, distributor or retailer reasonably believes
that the supplier of the product or container is reliably and
accurately complying with the requirements of this subpart.
(c) Contractual obligations. A wholesaler, distributor or
retailer's contractual relationship with its supplier under
which the supplier is required to accurately label, consistent
with the requirements of this subpart, any products manufactured
with a controlled substance that are supplied to the wholesaler,
distributor or retailer is evidence of reasonable belief.
82.120 Petitions.
(a) Requirements for procedure and timing. Persons seeking
to apply the requirements of this regulation to a product
containing
a class II substance or a product manufactured with a class
I or a class II substance which is not otherwise subject to
the requirements, or to temporarily exempt a product manufactured
with a class I substance, based on a showing of a lack of currently
or potentially available alternatives, from the requirements
of this regulation may submit petitions to: Labeling Program
Manager, Stratospheric Protection Division, Office of Atmospheric
Programs, U.S. Environmental Protection Agency, 6202-J, 401
M Street, SW., Washington, DC 20460. Such persons must label
their products while such petitions are under review by the
Agency.
(b) Requirement for adequate data. Any petition submitted
under paragraph (a) of this section shall be accompanied by
adequate data, as defined in 82.120(c). If adequate data are
not included by the petitioner, the Agency may return the petition
and request specific additional information.
(c) Adequate data. A petition shall be considered by the
Agency to be supported by adequate data if it includes all of
the following:
(1) A part clearly labeled "Section I.A." which contains
the petitioner's full name, company or organization name, address
and telephone number, the product that is the subject of the
petition, and, in the case of a petition to temporarily exempt
a product manufactured with a class I substance from the labeling
requirement, the manufacturer or manufacturers of that product.
(2) For petitions to temporarily exempt a product manufactured
with a class I substance only, a part clearly labeled "Section
I.A.T." which states the length of time for which an exemption
is requested.
(3) A part clearly labeled "Section I.B." which includes
the following statement, signed by the petitioner or an authorized
representative:
I certify under penalty of law that I have personally examined
and am familiar with the information submitted in this petition
and all attached documents, and that, based on my inquiry of
those individuals immediately responsible for obtaining the
information, I believe that the submitted information is true,
accurate, and complete. I am aware that there are significant
penalties for submitting false information.
(4) A part clearly labeled "Section I.C." which fully explains
the basis for the petitioner's request that EPA add the labeling
requirements to or remove them from the product which is the
subject of the petition, based specifically upon the technical
facility or laboratory tests, literature, or economic analysis
described in paragraphs (c)(5), (6) and (7) of this section.
(5) A part clearly labeled "Section II.A." which fully describes
any technical facility or laboratory tests used to support the
petitioner's claim.
(6) A part clearly labeled "Section II.B." which fully explains
any values taken from literature or estimated on the basis of
known information that are used to support the petitioner's
claim.
(7) A part clearly labeled "Section II.C." which fully explains
any economic analysis used to support the petitioner's claim.
(d) Criteria for evaluating petitions. Adequate data in support
of any petition to the Agency to add a product to the labeling
requirement or temporarily remove a product from the labeling
requirement will be evaluated based upon a showing of sufficient
quality and scope by the petitioner of whether there are or
are not substitute products or manufacturing processes for such
product:
(1) That do not rely on the use of such class I or class
II substance;
(2) That reduce the overall risk to human health and the
environment; and
(3) That are currently or potentially available.
(e) Procedure for acceptance or denial of petition. (1) If
a petition submitted under this section contains adequate data,
as defined under paragraph (c) of this section, the Agency shall
within 180 days after receiving the complete petition either
accept the petition or deny the petition.
(2) If the Agency makes a decision to accept a petition to
apply the requirements of this regulation to a product containing
or manufactured with a class II substance, the Agency will notify
the petitioner and publish a proposed rule in the Federal Register
to apply the labeling requirements to the product.
(3) If the Agency makes a decision to deny a petition to
apply the requirements of this regulation to a product containing
or manufactured with a class II substance, the Agency will notify
the petitioner and publish an explanation of the petition denial
in the Federal Register.
(4) If the Agency makes a decision to accept a petition to
temporarily exempt a product manufactured with a class I substance
from the requirements of this regulation, the Agency will notify
the petitioner and publish a proposed rule in the Federal Register
to temporarily exempt the product from the labeling requirements.
Upon notification by the Agency, such manufacturer may immediately
cease its labeling process for such exempted products.
(5) If the Agency makes a decision to deny a petition to
temporarily exempt a product manufactured with a class I substance
from the requirements of this regulation, the Agency will notify
the petitioner and may, in appropriate circumstances, publish
an explanation of the petition denial in the Federal Register.
82.122 Certification, recordkeeping, and notice requirements.
(a) Certification. (1) Persons claiming the exemption provided
in 82.106 (b)(2) must submit a written certification to the
following address:
Labeling Program Manager, Stratospheric Protection Division,
Office of Atmospheric Programs, 6202-J, 401 M Street, SW.,
Washington, DC 20460
(2) The certification must contain the following information:
(i) The exact location of documents verifying calendar year
1990 usage and the 95% reduced usage during a twelve month period;
(ii) A description of the records maintained at that location;
(iii) A description of the type of system used to track usage;
(iv) An indication of which 12 month period reflects the
95% reduced usage; and
(v) Name, address, and telephone number of a contact person.
(3) Persons who submit certifications postmarked on or before
May 15, 1993, need not place warning labels on their products
manufactured using CFC-113 or methyl chloroform as a solvent.
Persons who submit certifications postmarked after May 15, 1993,
must label their products manufactured using CFC-113 or methyl
chloroform as a solvent for 14 days following such submittal
of the certification.
(4) Persons certifying must also include a statement that
indicates that their future annual use will not at no time exceed
95% of their 1990 usage.
(5) Certifications must be signed by the owner or a responsible
corporate officer.
(6) If the Administrator determines that a person's
certification
is incomplete or that information supporting the exemption is
inadequate, then products manufactured using CFC-113 or methyl
chloroform as a solvent by such person must be labeled pursuant
to 82.106(a).
(b) Recordkeeping. Persons claiming the exemption under
82.106(b)(2)
must retain supporting documentation at one of their facilities.
(c) Notice Requirements. Persons who claim an exemption under
82.106(b)(2) must submit a notice to the address in paragraph
(a)(1) of this section within 30 days of the end of any 12 month
period in which their usage of CFC-113 or methyl chloroform
used as a solvent exceeds the 95% reduction from calendar year
1990.
82.124 Prohibitions.
(a) Warning statement. (1) Absence or presence of warning
statement. (i) On or after May 15, 1993, except as indicated
in paragraph (a)(5) of this section, no container or product
identified in 82.102(a) may be introduced into interstate commerce
unless it bears a warning statement that complies with the
requirements
of 82.106(a) of this subpart, unless such labeling is not required
under 82.102(c), 82.106(b), 82.112(c), 82.116(a), or temporarily
exempted pursuant to 82.120.
(ii) On or after January 1, 2015, or any time between May
15, 1993 and January 1, 2015 that the Administrator determines
for a particular product manufactured with or containing a class
II substance that there are substitute products or manufacturing
processes for such product that do not rely on the use of a
class I or class II substance, that reduce the overall risk
to human health and the environment, and that are currently
or potentially available, no product identified in 82.102(b)
may be introduced into interstate commerce unless it bears a
warning statement that complies with the requirements of 82.106
of this subpart, unless such labeling is not required under
82.106(b), 82.112(c) or 82.116(a).
(2) Placement of warning statement. (i) On or after May 15,
1993, except as indicated in paragraph (a)(5) of this section,
no container or product identified in 82.102(a) may be introduced
into interstate commerce unless it bears a warning statement
that complies with the requirements of 82.108 of this subpart,
unless such labeling is not required under 82.102(c), 82.106(b),
82.112(c), 82.116(a), or temporarily exempted pursuant to
82.120.
(ii) On or after January 1, 2015, or any time between May
15, 1993 and January 1, 2015 that the Administrator determines
for a particular product manufactured with or containing a class
II substance that there are substitute products or manufacturing
processes for such product that do not rely on the use of a
class I or class II substance, that reduce the overall risk
to human health and the environment, and that are currently
or potentially available, no product identified in 82.102(b)
may be introduced into interstate commerce unless it bears a
warning statement that complies with the requirements of 82.108
of this subpart, unless such labeling is not required under
82.106(b), 82.112 (c), or 82.116 (a).
(3) Form of label bearing warning statement. (i) On or after
May 15, 1993, except as indicated in paragraph (a)(5) of this
section, no container or product identified in 82.102(a) may
be introduced into interstate commerce unless it bears a warning
statement that complies with the requirements of 82.110 of
this subpart, unless such labeling is not required pursuant
to 82.102(c), 82.106(b), 82.112(c), 82.116(a), or temporarily
exempted pursuant to 82.120.
(ii) On or after January 1, 2015, or any time between May
15, 1993 and January 1, 2015 that the Agency determines for
a particular product manufactured with or containing a class
II substance, that there are substitute products or manufacturing
processes that do not rely on the use of a class I or class
II substance, that reduce the overall risk to human health and
the environment, and that are currently or potentially available,
no product identified in 82.102(b) may be introduced into
interstate
commerce unless it bears a warning statement that complies with
the requirements of 82.110 of this subpart, unless such labeling
is not required pursuant to 82.106(b), 82.112(c), or 82.116(a).
(4) On or after May 15, 1993, no person may modify, remove
or interfere with any warning statement required by this subpart,
except as described in 82.112 of this subpart.
(5) In the case of any substance designated as a class I
or class II substance after [insert date of publication], the
prohibitions in paragraphs (a)(1)(i), (a)(2)(i), and (a)(3)(i)
of this section shall be applicable beginning one year after
the effective date of designation of such substance as a class
I or class II substance or shall be applicable beginning on
the date provided in the rulemaking designating such substance
as a class I or class II substance, whichever comes first.
[FR Doc. 93-2704 Filed 2-10-93; 8:45 am]
BILLING CODE 6560-50-P
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