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August 25, 2016

B&C Memoranda Featured In Inside EPA Article, “Attorneys Say Proposed TSCA Rule May Violate Trade Secret Provisions”

Bergeson & Campbell, P.C.

On August 25, 2016, the Bergeson & Campbell, P.C., (B&C®) memoranda “TSCA Reform: Proposed Changes to SNUR Procedures Would, Perhaps Inadvertently, Result in Disclosure of CBI to Third Parties/Possible Competitors” and “TSCA: Proposed Revisions to Significant New Use Rules Reflect Current Occupational Safety and Health Standards,” were discussed in an Inside EPA article on how Toxic Substances Control Act (TSCA) Reform may violate trade secret provisions.

“We do not read provisions in either old or new TSCA to authorize EPA to disclose CBI in the way that is proposed in this notice,” the firm Bergeson & Campbell writes in an Aug. 8 memo to friends and clients.

The memo follows an earlier July 28 memo that questioned other aspects of a multi-part rule proposing changes to EPA’s approach to restricting industrial chemicals under TSCA, also known as Significant New Use Rules (SNURs). EPA’s proposed rule generally requires the use of internationally-harmonized chemical labels, the use of protective measures for workers and specific respiratory protections — all standards that the Occupational Safety & Health Administration (OSHA) has also adopted — when developing SNURs.

The firm in its earlier memo questioned EPA’s proposal to require the use of an approach called hierarchy of control (HOC), used by OSHA, in all issued and future chemical uses affected by a SNUR. The memo noted that Congress considered HOC in earlier versions of the legislation that eventually re-wrote TSCA, but dropped the issue from the final reform bill. Despite its concerns, the memo notes there “may well be good reasons for several of the proposed changes” (Inside EPA, Aug. 5).

But the rule also proposes a change to EPA’s approach to handling SNURs on trade secret chemical uses, and this is what Bergeson & Campbell addresses in the second memo. The firm writes that among the changes in the rule is a proposal that would impact companies with chemicals whose names or uses are considered trade secret and which are the subject of SNURs.

A company seeking to introduce what it thinks is a new chemical or new use of chemical to the market must ask EPA whether there are any SNURs on the use of that chemical that might be a trade secret, as part of the bona fide notification process of providing proof they intend to begin market production of a chemical for a specific use.

But the proposed rule would allow EPA to disclose specific information about the existing uses of the requested chemical rather than just acknowledging whether a SNUR exists, the memo says.

“Importantly, this change means that EPA is switching from a presumption of protecting CBI in the SNUR to actively informing later submitters of information proprietary to the original submitter,” the memo states. “While 40 C.F.R. § 721.11(f) states that informing later submitters of SNUR restrictions ‘will not be considered public disclosure of [CBI] under Section 14,’ it is an unavoidable fact that EPA’s proposed approach involves disclosure of CBI to an additional party, one that could be a competitor to the original submitter (both are, after all, manufacturing the same substance), a fact pattern that is very likely to be of considerable concern to the original submitter.”