On December 10, 2020, the U.S. Environmental Protection Agency (EPA) announced the availability of a draft compliance guide that outlines which imported articles are covered by EPA’s July 2020 final significant new use rule (SNUR) that prohibits companies from manufacturing, importing, processing, or using certain long-chain per- and polyfluoroalkyl substances (PFAS) without prior EPA review and approval. The draft guide will be “the official compliance guide for imported articles that may contain long-chain perfluoroalkyl carboxylate chemical substances as part of a surface coating.” According to EPA, the draft guide provides additional clarity on what is meant by a “surface coating”; identifies which entities are regulated; describes the activities that are required or prohibited; and summarizes the notification requirements of the final SNUR. EPA intends to publish a notice in the Federal Register announcing the availability of the draft guidance and beginning a 30-day comment period.

Background

On July 27, 2020, EPA promulgated a final SNUR for long-chain perfluoroalkyl carboxylate (LCPFAC) and perfluoroalkyl sulfonate chemical substances. 85 Fed. Reg. 45109. EPA first proposed a SNUR for LCPFAC and perfluoroalkyl sulfonate chemical substances on January 21, 2015. 80 Fed. Reg. 2885. On March 3, 2020, EPA issued a proposed supplemental SNUR for LCPFAC chemical substances that would make inapplicable the exemption for persons who import a subset of LCPFAC chemical substances as part of surface coatings on articles. 85 Fed. Reg. 12479. The final SNUR requires persons to notify EPA at least 90 days before commencing the manufacture (including import) or processing of these chemical substances for the significant new uses described in the notice. The required significant new use notification initiates EPA’s evaluation of the conditions of use associated with the significant new use. Manufacturing (including import) or processing for the significant new use are prohibited from commencing until EPA has conducted a review of the notice, made an appropriate determination on the notice, and taken such actions as are required in association with that determination. EPA notes that as with any SNUR, the final rule excludes ongoing uses as ongoing uses cannot be subject to a SNUR. The final rule was effective on September 25, 2020.

EPA states that the March 2020 proposed supplemental SNUR was intended “to be responsive to the article consideration provision” under Section 5(a)(5) of the Toxic Substances Control Act (TSCA), which was added by the Frank R. Lautenberg Chemical Safety for the 21st Century Act (Lautenberg Act). Section 5(a)(5) states that articles can be subject to notification requirements as a significant new use provided that EPA makes an affirmative finding in a rule that the reasonable potential for exposure to a chemical from an article or category of articles justifies notification. More information on the proposed supplemental SNUR is available in our February 28, 2020, memorandum, “Proposed Supplemental SNUR Would Remove Exemption for LCPFAC Chemical Substances Used as Surface Coatings on Articles.”

The final SNUR will require persons to notify EPA at least 90 days before commencing:

• The manufacturing (including importing) or processing of a subset of LCPFAC chemical substances for any use that was not ongoing after December 31, 2015;

• The manufacturing (including importing) or processing of all other LCPFAC chemical substances for which there were no ongoing uses as of January 21, 2015 (the date of the original proposed SNUR);

• The import of a subset of LCPFAC chemicals as part of a surface coating on articles; and

• The import of perfluoroalkyl sulfonate chemical substances as part of carpets.

The final SNUR will preclude the commencement of such manufacturing and processing until EPA has conducted a review of the notice, made an appropriate determination on the notice, and taken such actions as are required in association with that determination. More information is available in our July 27, 2020, memorandum, “EPA Issues Final SNUR for LCPFAC and Perfluoroalkyl Sulfonate Chemical Substances.”

Draft Compliance Guide

The draft compliance guide is intended to assist companies that import LCPFAC chemical substances as part of a surface coating on articles. According to EPA, many of the following types of businesses may be covered by the draft guide:

• Manufacturers (including importers) of one or more of subject chemical substances (North American Industrial Classification System (NAICS) codes 325 and 324110), e.g., chemical manufacturing and petroleum refineries;

• Fiber, yarn, and thread mills (NAICS code 31311);

• Carpet and rug mills (NAICS code 314110);

• Home furnishing merchant wholesalers (NAICS code 423220);

• Carpet and upholstery cleaning services (NAICS code 561740);

• Manufacturers of computer and other electronic products, appliances, and components (NAICS codes 324 and 335);

• Manufacturers of surgical and medical instruments (NAICS 339112);

• Merchant wholesalers (NAICS codes 423 and 424);

• Stores and retailers (NAICS codes 442, 442, 444, 448, 451, and 454); and

• Providers of other support services (NAICS code 561990).

Guidance for Articles Subject to the SNUR

What Is an Article

The draft compliance guide states that as defined at 40 C.F.R. Section 704.3, “article means a manufactured item: (1) which is formed to a specific shape or design during manufacture; (2) which has end use function(s) dependent in whole or in part upon its shape or design during end use; and (3) which has either no change of chemical composition during its end use or only those changes of composition which have no commercial purpose separate from that of the article, and that result from a chemical reaction that occurs upon end use of other chemical substances, mixtures, or articles; except that fluids and particles are not considered articles regardless of shape or design.” According to the draft guide, an imported article must have an end‐use function dependent in whole or in part upon a shape or design that was present at the point of import. If the shape and design of an item at the point of import does not serve any function with respect to the item’s end use, then the item being imported is not an article. EPA provides the following example:

Plastic or metallic blocks or sheets imported and then processed in such a way that they entirely lose the shape they had at the point of import (e.g., by being melted down, molded, extruded, cut up extensively or into small pieces, or further reacted) would not qualify as articles at the point of importation. Conversely, if plastic or metallic sheeting is imported with a specific thickness, the sheeting may still be considered an imported article even though the expected end use of the sheeting may involve cutting or trimming to a different length or width. However, there must still be a relationship between the shape or design of the sheeting and the end use of the sheeting.

Examples of Articles Subject to the SNUR

The draft compliance guidance states that because the LCPFAC SNUR is for significant new uses, the following is a non-exhaustive list of potential articles that may use LCPFAC chemical substances as part of a surface coating on the article:

What Is Not an Article

The draft compliance guide states that products such as paints, lubricants, and fire-fighting foam are not articles. A paint, however, would be considered as part of an article if applied to an article (e.g., paint on a car is considered as part of an article but paint in a can is not an article under TSCA). Additionally, according to the draft guide, a lubricant applied to an article would be considered as part of an article. The draft compliance guide provides the following example:

A lubricant such as automotive grease would be considered part of an article when already included within an automobile’s engine. When automotive grease is purchased by a consumer at a car supply store to add to the automobile, that automotive grease would not be considered an article.

What Is a Surface Coating?

According to the draft compliance guide, a coating is a material applied in a thin layer to a surface as a protective, decorative, or functional film. The draft guide notes that the term “coating” often refers to paints such as lacquers or enamels, but states that it also refers to films applied to other materials, including, but not limited to, paints, varnishes, sealants, adhesives, inks, maskants, and temporary protective coatings.

The draft guide states that during the public comment period for the 2020 proposed supplemental SNUR, several commenters asked EPA to define “surface coating” and to include a definition in the regulatory text of the rule. EPA declined to do so, but instead “is providing additional clarity on what is meant by a ‘surface coating’ in this guidance document.” The draft compliance guide provides the following example:

If Chemical A is used in furniture varnish that is applied during the production of a piece of furniture at a furniture manufacturer, once Chemical A is applied to the furniture, Chemical A is considered a surface coating that is part of an article. If a varnish containing Chemical A is purchased at a hardware store, for use by a consumer to build or refinish a piece of furniture, the container of varnish containing Chemical A could be used as a surface coating but not be considered as part of an article.

What Constitutes a Surface Coating Subject to the SNUR?

In the context of the LCPFAC SNUR, EPA considers any LCPFAC from the list in Table 1 of the draft compliance guide or perfluorooctanoic acid (PFOA) and its salts that meets one of the following two criteria to be a surface coating covered by the SNUR:

1. Coating on any surface of an article that is in direct contact with humans or the environment during the article’s normal use or reuse, whether the coating is oriented towards the interior or exterior of the article; or

2. Coating on any internal component, even if facing the interior of the article, if that component is in contact with humans or the environment during the article’s normal use or reuse.

The draft compliance guide provides the following example:

An importer of luggage is working with a foreign manufacturer to develop a new product line of fabric luggage. To protect the luggage against water and stains, the importer would like a surface coating protectant applied to the luggage. The foreign manufacturer has three coatings they can use: one with Chemical A, another with Chemical B, and another with Chemical C. All three chemicals are LCPFAC chemical substances, so the importer must ensure that he complies with the final LCPFAC SNUR. While all three chemical substances are LCPFAC chemical substances, they are not all subject to the same requirements of the final SNUR.

Chemical A is Chemical Abstracts Service Registry Number (CASRN) 17741-60-5, which is listed in Table 1 - LCPFAC Chemical Substances Subject to Reporting After December 31, 2015. Because it is listed in Table 1 and there is no ongoing use for Chemical A under 40 C.F.R. Section 721.10536(b)(5), Chemical A is subject to the LCPFAC SNUR when imported in an article as part of a surface coating. If the importer wishes to import luggage containing Chemical A as a surface coating, they must first submit a SNUN at least 90 days before they intend to commence import.

Chemical B is CASRN 27905-45-9, which is also listed in Table 1 -- LCPFAC Chemical Substances Subject to Reporting After December 31, 2015. Chemical B has an ongoing use pursuant to 40 C.F.R. Section 721.10536(b)(5)(ii), however, for use “as a coating or component of a hydrophobic and/or oleophobic coating or barrier applied to manufactured articles or component of articles using an energy source or plasma deposition methods, which include a pulse deposition mode. Examples of such articles include: electronic devices and components thereof, medical consumables and bio-consumables, filtration devices and filtration materials, clothing, footwear and fabrics.” Because the use of Chemical B as a coating on fabric is recognized as an ongoing use in the final SNUR, this use of Chemical B is not a significant new use subject to the final SNUR. The foreign manufacturer may use CASRN 27905-45-9 as a surface coating on the fabric luggage without the importer needing to submit a SNUN.

Chemical C is CASRN XXXX-XX-X (a hypothetical chemical for this example), which is a LCPFAC chemical substance subject to the final SNUR pursuant to 40 C.F.R. Section 721.10536(b)(1). Chemical C is not listed in Table 1 - LCPFAC Chemical Substances Subject to Reporting After December 31, 2015 and it is not PFOA or a PFOA salt. Only LCPFAC chemical substances that are listed in Table 1 or that are PFOA and its salts are subject to the notification requirements of 40 C.F.R. Section 721.25 when imported as part of a surface coating of an article (see 40 C.F.R. Section 721.10536(c)(1)). As such, when imported as part of a surface coating of an article, Chemical C is not subject to the rule and may be used by the foreign manufacturer as a surface coating on the fabric luggage and then imported into the US without the importer needing to submit a SNUN. Chemical C may be subject to the SNUR if manufactured, imported, or processed for another use, however.

Surface Coatings That Have Cured or Undergone Chemical Reaction after Application

A question arose as to the application of the SNUR to surface coatings that have cured post-application. According to the draft compliance guide, articles that have surface coatings that contain certain LCPFAC chemical substances that have been cured or undergone chemical reaction after being applied to an article are subject to the SNUR.

Complex Durable Goods

The draft compliance guide states that complex durable goods are subject to the SNUR. TSCA Section 6(c)(2)(D) defines the term “complex durable good.” The draft guide states that statutory exemptions for replacement parts for complex durable goods may be granted pursuant to TSCA Section 6(c)(2)(D) in some cases, but only in TSCA Section 6(a) risk management rules. Designation as a “complex durable good” under TSCA Section 6 does not affect whether a use is or is not a significant new use under the SNUR. According to the draft compliance guide, “EPA acknowledges that imported articles may be comprised of multiple components and have a complex supply chain, which may present greater demands on some importers to ensure that if an article contains certain LCPFAC chemical substances in surface coatings, a SNUN is submitted to EPA [at] least 90 days before engaging in import.”

An Article Containing an LCPFAC Chemical Substance as a Surface Coating Where the LCPFAC Chemical Substance Is Believed Not to Be Released

The draft compliance guide states that if an article contains an LCPFAC chemical substance as a surface coating, but the LCPFAC chemical substance is believed not to be released, the article is subject to the SNUR. According to the draft guide, in the final SNUR, EPA affirmatively found that under TSCA Section 5(a)(5) that the notification for import is justified due to the reasonable potential for exposure to certain LCPFAC chemical substances when part of surface coatings on articles. The article is subject to the SNUR regardless of whether the importer believes that no release or exposure will result from an imported article containing a subject LCPFAC chemical substance as part of a surface coating, unless that given use is listed as an ongoing use at 40 C.F.R. Section 721.10536(b)(5). To import an article containing certain LCPFAC chemical substances in surface coatings, a SNUN needs to be submitted to EPA at least 90 days before importation occurs. The submission of a SNUN allows EPA to evaluate potential uses (before those uses would begin) for any hazards, exposures, and risks that might exist.

Impurities in Surface Coatings

The draft compliance guide states that impurities in surface coatings are not subject to the SNUR. To the extent the chemical substance subject to the SNUR is only “unintentionally present” at the point of foreign manufacture, it is exempt from reporting by the importer as an imported impurity (see 40 C.F.R. Section 721.45(d)). As such, importers are not required to submit a SNUN for a substance based simply on that substance’s presence as an impurity (i.e., a chemical substance is unintentionally present with another chemical substance (40 C.F.R. Section 720.3(m)). If a subject LCPFAC chemical substance is only present as an impurity in a surface coating as part of an article, then it is not subject to the SNUR.

Processors of Articles

According to the draft compliance guide, processors of articles are not subject to the SNUR. The draft guide states that EPA is retaining the exemption at 40 C.F.R. Section 721.45(f) for persons who process chemical substances as part of articles because existing stocks of articles still contain LCPFAC or perfluoroalkyl sulfonate chemical substances. Because the processing of articles containing LCPFAC or perfluoroalkyl sulfonate chemical substances is ongoing, it cannot be subject to a SNUR. The draft guide notes that EPA considers recycling to be a form of processing.

Who Must Comply

According to the draft compliance guide, an importer of articles is subject to the SNUR if he/she imports, for a “significant new use,” articles containing a subset of LCPFAC chemical substances as part of a surface coating. The subset of LCPFAC chemical substances for which EPA lifted the articles exemption includes those listed in Table 1 of the draft guide and PFOA or its salts.

The draft compliance guide states that use of the subject LCPFAC chemical substances as part of food packaging or medical devices is not subject to the rule. TSCA Section 3(2)(B) excludes any food, food additive, drug, cosmetic, or device regulated under the Federal Food, Drug, and Cosmetic Act from the definition of a chemical substance under TSCA. The U.S. Food and Drug Administration (FDA) has separately issued restrictions on the use of PFAS chemical substances in FDA regulated uses, however. The draft guide suggests that prior to import, importers should ensure that they are in compliance with all federal and state regulations regarding PFAS chemical substances.

The final SNUR included amendments requiring persons to notify EPA at least 90 days before commencing: the manufacturing (including importing) or processing of a subset of LCPFAC chemical substances for any use that was not ongoing after December 31, 2015; the manufacturing (including importing) or processing of all other LCPFAC chemical substances for which there were no ongoing uses as of January 21, 2015 (the date of the original 2015 proposal); and the import of perfluoroalkyl sulfonate chemical substances as part of carpets. EPA notes that these additional amendments “are not the subject of this compliance guide,” however.

Commentary

In response to comments on the 2020 supplemental proposed rule that asked EPA to define “surface coating” in the final SNUR, EPA chose not to define the term and stated that it would address the subject within a reasonable time. EPA stated that it “is not defining this term due to the many different ways that LCPFAC chemical substances could be applied to an article as part of a surface coating and how a given article could move through the supply chain from manufacture to disposal.” 85 Fed. Reg. at 45114. The draft guidance is a step in the implementation of that commitment. EPA’s decision to seek comment on the draft guidance is to be commended. It will be especially welcomed by potentially regulated entities and help inform and improve the final guidance when issued in final. We question whether the 30-day public comment period is sufficient, however, given the holiday season as well as the COVID-19 public health crisis as the guidance raises many significant issues.

For example, and as noted above, the draft guidance states that in the context of the LCPFAC SNUR, EPA considers any LCPFAC from the list in Table 1 of the draft compliance guide or PFOA and its salts that meets one of the following two criteria to be a surface coating covered by the SNUR:

1. Coating on any surface of an article that is in direct contact with humans or the environment during the article’s normal use or reuse, whether the coating is oriented towards the interior or exterior of the article; or

2. Coating on any internal component, even if facing the interior of the article, if that component is in contact with humans or the environment during the article’s normal use or reuse.

Additional explanation of what “contact with the environment” means in these criteria under the draft guidance may be useful to the potentially regulated community. For example, does it mean any exposure to air or not totally enclosed?

In explaining in the draft guidance what an “article” is under SNUR, EPA refers to the definition of “article” in the TSCA Section 8(a) reporting and recordkeeping regulations at 40 C.F.R. Section 704.3. As the definition of “article” in the premanufacture notification regulation at 40 C.F.R. Section 720.3 appears applicable to the SNUR given 40 C.F.R. Section 721.3, which, in turn, refers to the definitions at 40 C.F.R 720.3, and the regulations at 40 C.F.R. Sections 721.9582(a) and 721.10536(a) state that the definitions at 40 C.F.R. Section 721.3 apply, EPA’s reference to 40 C.F.R. Section 704.3 for purposes of the guidance thus appears to be in error. The definitions of “article” at 40 C.F.R. Section 720.3 and 40 C.F.R. Section 704.3 are substantially similar, however. The draft guidance merits a disciplined review, thoughtful comment, and a longer comment period.