Off the Books II: More Secret Chemicals

Seven years later, federal toxics law is still protecting the chemical industry’s dirty secrets

May 9, 2016

Off the Books II: More Secret Chemicals : Pending TSCA Bills

Congress passed two bills last year to update TSCA: H.R. 2576, the TSCA Modernization Act, and S. 697, The Frank R. Lautenberg Chemical Safety for the 21st Century Act. Both seek to address the issue of chemical trade secret claims to varying degrees. S. 697, the Senate bill, also takes steps to update the TSCA inventory to give an idea for the first time which of the 85,000 chemicals on the inventory are actually in use.

Confidential business information

Both the House and Senate bills address the issue of trade secrets but take very different approaches.

Health and safety studies. 
Under current law, one major exception to trade secret protection is that EPA is allowed to release information in health and safety studies about a chemical. Both bills retain a form of this exemption, with some key differences.

The House bill rolls back current law by allowing companies to protect “data that discloses formula (including molecular structure)” in their health and safety studies, which would likely allow them to keep the chemical identity secret. Under current law, the chemical identity cannot be claimed as a trade secret in health and safety studies. The Senate bill does not include this rollback.

Additionally, the Senate bill strengthens the framing of this exception by saying that information from health and safety studies “shall not be protected” from disclosure. The House bill retains the softer approach in current law by stating that the EPA “shall not prohibit” disclosure of information – leaving the ultimate decision up to EPA discretion.

Information for state and local regulators.
Under current law, EPA is not able to share trade secrets with state and local regulators, even to enforce local laws. The House bill would give EPA discretion to share this information with state and local regulators. The Senate bill would make it mandatory to share the information.

Requirements for claiming trade secret protection.
The Senate bill provides clear requirements for what companies must do to claim trade secret protection, including showing that the information could not be obtained by reverse engineering. Like current law, the House bill does not provide any such guidance.

Trade secrets in case of a ban or phase-out.
Under the Senate bill, a chemical loses trade secret protection if the EPA bans or phases it out – an improvement over current law. There is no corresponding provision in the House bill.

Review and re-substantiation.
Under current law, trade secret protection status never expires. Under both bills, new trade secret claims would expire after 10 years, after which the claims would have to be re-substantiated in order to be renewed. However, only the Senate bill would require EPA to look systematically at past trade secret claims and require that they be dropped or renewed. Under the House bill, past claims would remain secret indefinitely.

The House bill would also only allow EPA to seek re-substantiation for trade secret claims when those claims are about to expire. By contrast, the Senate allows or requires re-substantiation whenever safety concerns arise. EPA would have discretion to request re-substantiation if a chemical is designated as high priority for safety review or the agency determines that more information is needed to make a safety determination. Re-substantiation would be required anytime a chemical is found to pose serious risks or if a chemical that had been out of use is put back into commerce. The Senate bill’s triggers for review and re-substantiation would provide an important check on chemical secrecy.

One other important difference between the House and Senate bills involves the treatment of the TSCA inventory. The House bill would not change the TSCA inventory, but the Senate bill would require industry to notify the EPA when a chemical is no longer used or becomes inactive. Dividing the TSCA inventory into active and inactive lists would greatly help the EPA and other researchers to identify exactly which chemicals they should focus on.