Are you ready for EPA’s 2016 Chemical Data Reporting?
The Toxic Substances Control Act (TSCA) requires companies in the U.S., both manufacturers and importers, under the Chemical Data Reporting (CDR) Rule to provide the United States Environmental Protection Agency (EPA) with information about the chemicals that they manufacture or import.
While most people focus on the chemical industry for the CDR Rule, it applies more broadly to:
- Chemical manufacturers and importers (NAICS codes 325 and 324110).
- Companies who may manufacture a chemical substance as a byproduct (NAICS codes 22, 322, 331, and 3344; e.g., utilities, paper manufacturing, primary metal manufacturing, and semiconductor and other electronic component manufacturing)
This information is used by the EPA to determine if there are human health and/or environmental effects from the use of these chemicals and to protect the public from potential chemical risks. Information collected includes:
- Production volumes for calendar years 2012, 2013, 2014, and 2015
- Manufacturing, processing, and use information for 2015
- Information on manufacture/import
- Industrial processing & use
- Consumer use
- Basic exposure-related information on the types, quantities, and uses of chemicals
All non-confidential information received by the EPA under this rule is available to the general public.
Companies are required to provide this information every 4 years for the following types of chemicals currently listed on the TSCA Chemical Substance Inventory (TSCA Inventory):
- Chemicals with production volumes of 25,000 pounds or greater at a single site for any calendar year in the 2012-2015 time period
- Chemical substances subject to certain TSCA actions with production volumes of 2,500 pounds or greater at a single site
2016 CDR submissions have to be made between June 1, 2016 and September 30, 2016.
Enforcement and Penalties
EPA actively enforces the CDR Rule. Violations can lead to civil or criminal penalties of up to $37,500 per violation per day; often several years after the reporting period.
In July 2012, the US Environmental Protection Agency (EPA) took enforcement action against three companies as a result of untimely, inaccurate or incomplete submissions in the 2006 reporting year. Penalties ranged from $55,000 to greater than $200,000.
In January 2013, the EPA reached a settlement with a global chemical company for violations of TSCA’s Inventory Update Rule (IUR), now referred to as CDR. The penalties were in excess of $500,000.
What steps can companies take to minimize risk in 2016?
- Ensure quality of data. Delayed or inaccurate submissions can potentially result in significant penalties.
- Maintain documentation for the required five years and beyond. This documentation may be necessary to respond to EPA inquiries, which are likely to occur years after reporting.
- Maintain an informed team to facilitate responding to EPA inquiries and minimize business disruption.
- Get started early. It takes time to obtain quality data, create clear and accessible documentation and build an informed team.
1. Organize your teams
As a manufacturer/importer of chemicals, you will have to review all of your processes to identify chemicals eligible for reporting. You will have to engage colleagues from multiple departments in this process – legal, manufacturing, procurement environment, health, & safety, etc., while making sure that everyone is up to speed with the reporting requirements and aligned on the deliverables and timelines.
2. Identify chemicals
You will have to start identifying chemicals that you manufacture or import that meet the 2016 reporting thresholds. See table below.
3. Start data collection
You will have to collect and assemble information from your facilities as well as your suppliers – both of which could end up being a time-consuming and resource intensive process. So if you have not started collecting this data already, you will need to start right away. You may have to educate your suppliers on the reporting requirements as well.
Companies are using many different methods to gather their compliance data from their suppliers. Most frequently it is via Excel or an online survey but both of these methods have significant failings.
To significantly reduce the time and associated costs, evaluate data collection software tools that will enable you to get a jumpstart on your reporting process.
About the writers
Ashish P. Deshmukh, Principal Consultant, Environmental Resources Management (ERM)
Ashish has over 20 years of experience in the environmental and chemical sciences, with particular emphasis on product safety and regulatory compliance. Specific areas of expertise include providing regulatory support for specialty chemicals, novel polymers, and advanced materials; evaluating the safety of products for food contact use; and characterizing substances using advanced analytical techniques. Specialized experience includes conducting product regulatory compliance audits under EPA’s Audit Policy and evaluating product regulatory compliance as part of M&A-related due diligence activities.
Ashish has a PhD in Environmental Chemistry and an MBA from the Ohio State University. He was a post-doctoral scholar at Princeton University.