[Federal Register Volume 72, Number 47 (Monday, March 12, 2007)]
[Rules and Regulations]
[Pages 10925-10928]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-4314]


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DEPARTMENT OF JUSTICE

Drug Enforcement Administration

21 CFR Part 1310

[Docket No. DEA-137F3]
RIN 1117-AA31


Exemption of Chemical Mixtures

AGENCY: Drug Enforcement Administration (DEA), U.S. Department of 
Justice.

ACTION: Final rule.

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SUMMARY: On December 15, 2004, the Drug Enforcement Administration 
(DEA) published a Final Rule corrected January 4, 2005) that 
implemented new regulations concerning chemical mixtures that contain 
any of the 27 listed chemicals. The Final Rule added a new provision 
not previously raised by DEA in any proposed rulemaking. This newly 
introduced provision exempted domestic and import transactions in 
chemical mixtures that are regulated solely due to the presence of the 
List II solvent chemicals acetone, ethyl ether, 2-butanone, or toluene 
from the Controlled Substances Act (CSA) recordkeeping and reporting 
requirements. Because this exemption was not previously proposed in any 
rulemaking, DEA implemented this exemption on an interim basis and 
requested public comment on this exemption provision.
    Based upon a review of all comments, DEA is finalizing this 
exemption. As such, domestic and import transactions in chemical 
mixtures containing the List II chemicals acetone, ethyl ether, 2-
butanone, and toluene shall be exempt from CSA chemical recordkeeping 
and reporting requirements.

DATES: This Final Rule is effective March 12, 2007.

FOR FURTHER INFORMATION CONTACT: Christine A. Sannerud, Ph.D., Chief, 
Drug & Chemical Evaluation Section, Office of Diversion Control, Drug 
Enforcement Administration, Washington, DC 20537, telephone (202) 307-
7183.

SUPPLEMENTARY INFORMATION:

I. Background

Historical Legal Status of Chemical Mixtures

    The Chemical Diversion and Trafficking Act of 1988 (CDTA), (Pub. L. 
100-690) created the definition of ``chemical mixture'' (21 U.S.C. 
802(40)), and exempted chemical mixtures from regulatory control. The 
CDTA established 21 U.S.C. 802(39)(A)(vi), as amended by Title VII of 
Public Law 109-177, to exclude ``any transaction in a chemical 
mixture'' from the definition of a ``regulated transaction.'' The 
exemption of all chemical mixtures, however, provided traffickers with 
an unregulated source for obtaining listed chemicals for use in the 
illicit manufacture of controlled substances.
    To remedy this situation, the Domestic Chemical Diversion Control 
Act of 1993 (Pub. L. 103-200) (DCDCA), enacted in April 1994, subjected 
chemical mixtures containing listed chemicals to CSA regulatory 
requirements, unless specifically exempted by regulation. The DCDCA, 
therefore, subjected all regulated chemical mixtures to recordkeeping, 
reporting, and security requirements of the CSA. Additionally, the 
DCDCA added a registration requirement for handlers of regulated List I 
chemical mixtures.
    The DCDCA, however, also amended 21 U.S.C. 802(39)(A)(vi), as 
amended by Title VII of Public Law 109-177, to provide the Attorney 
General with the authority to establish regulations exempting chemical 
mixtures from the definition of a ``regulated transaction'' ``based on 
a finding that the mixture is formulated in such a way that it cannot 
be easily used in the illicit production of a controlled substance and 
that the listed chemical or chemicals contained in the mixture cannot 
be readily recovered'' (21 U.S.C. 802(39)(A)(vi) as amended by Title 
VII of Pub. L. 109-177). This authority has been delegated to the 
Administrator of DEA by 28 CFR 0.100 and redelegated to the Deputy

[[Page 10926]]

Administrator under 28 CFR Appendix to Subpart R, section 12.
    Prior to publication of a final rulemaking, chemical mixtures 
containing listed chemicals have been treated as exempt from CSA 
regulatory control. Regulations regarding the exemption of chemical 
mixtures were initially proposed by DEA on October 13, 1994, as part of 
its proposed regulations to implement the DCDCA (59 FR 51888). In 
response to industry concerns, the proposed regulations were withdrawn 
on December 9, 1994, (59 FR 63738).
    DEA proposed new regulations regarding the exemption of chemical 
mixtures by publishing a new NPRM entitled ``Exemption of Chemical 
Mixtures'' on September 16, 1998 (63 FR 49506). DEA proposed the 
following three-tiered approach to identify which chemical mixtures 
qualify for automatic exemption: (1) It contains a listed chemical at 
or below an established concentration limit; or (2) it falls within a 
specifically defined category; or (3) the manufacturer of the mixture 
applies for and is granted a specific exemption for the product.
    On December 15, 2004, DEA published a final rule which specified 
criteria used to determine whether chemical mixtures qualify for 
automatic exemption from CSA chemical regulatory controls for 27 listed 
chemicals (69 FR 74957; corrected at 70 FR 294, January 4, 2005). Those 
chemical mixtures that do not meet the exemption criteria are treated 
as regulated chemicals and therefore, subject to CSA chemical 
regulatory controls.

Chemical Mixture Definition

    Title 21 U.S.C. 802(40) defines the term ``chemical mixture'' as 
``a combination of two or more chemical substances, at least one of 
which is not a List I chemical or a List II chemical, except that such 
term does not include any combination of a List I chemical or a List II 
chemical with another chemical that is present solely as an impurity.'' 
Therefore, a chemical mixture contains any number of listed chemicals 
along with any number of non-listed chemicals. A combination of only 
listed chemicals is, therefore, not a chemical mixture pursuant to the 
CSA definition. As such, the regulatory controls pertaining to each 
individual listed chemical are applicable.
    It is DEA's longstanding policy that the combination of a listed 
chemical in an inert carrier is not considered a chemical mixture. An 
inert carrier can be any chemical that does not interfere with the 
listed chemical's function but is present to aid in the delivery of the 
listed chemical so it can be used in some chemical process. Examples 
include, but are not limited to, solutions of listed chemicals such as 
methylamine in water or hydrogen chloride dissolved in water or 
alcohol. Persons who question if their formulations are chemical 
mixtures should contact DEA for guidance.

New Interim Chemical Mixture Exemption Category

    The Final Rule published on December 15, 2004, (69 FR 74957; 
corrected at 70 FR 294, January 4, 2005) also added, on an interim 
basis, a new exemption category. DEA determined that certain solvent-
based mixtures involving silicon-based products, paint-related 
materials, and other solvent-based chemical mixtures containing 
acetone, ethyl ether, 2-butanone, and toluene are not likely to be 
diverted domestically. These solvent chemicals are mostly a concern 
because they are used in cocaine and heroin processing, which occurs 
outside the United States.
    Therefore, the December 15, 2004 rulemaking created a new exemption 
category for these mixtures. Domestic and import transactions in 
chemical mixtures that are regulated solely due to the presence of the 
List II solvent chemicals acetone, ethyl ether, 2-butanone, or toluene 
were removed, on an interim basis, from the definition of a regulated 
transaction by adding a new paragraph to 21 CFR 1310.08. Methyl 
isobutyl ketone, also a List II solvent chemical, was not included 
because domestic and import transactions in that chemical have already 
been excluded from the definition of a regulated transaction at 21 CFR 
1310.08.
    This new exemption (for domestic and import transactions in 
chemical mixtures containing the List II chemicals acetone, ethyl 
ether, 2-butanone, and toluene) was not discussed in the original NPRM 
published on September 16, 1998 (63 FR 49506). Therefore, this 
exemption was implemented on an interim basis with opportunity for 
public comment in the December 15, 2004 rulemaking (69 FR 74957; 
corrected at 70 FR 294, January 4, 2005). DEA solicited comments on 
this portion of the rulemaking.

II. Comments Received Regarding the Interim Regulations

    DEA received three comments in response to the December 15, 2004, 
rulemaking (69 FR 74957) from interested parties. Two comments were 
from trade associations, and one comment was from a chemical 
manufacturer. In general, the comments supported efforts by DEA to 
regulate chemical mixtures that have potential use to drug traffickers. 
Each comment specifically supported finalization of the exemption for 
domestic and import transactions for chemical mixtures containing the 
List II solvent chemicals acetone, ethyl ether, 2-butanone, and 
toluene.
    Two comments, however, requested that the exemption be expanded to 
include certain exports of such chemical mixtures. The comments 
suggested that DEA only regulate exports of such mixtures to certain 
specific countries of concern. Given the applicability of such solvents 
for both cocaine and heroin processing, however, the geographic regions 
of concern are extremely widespread. Additionally, DEA has concerns 
that exports of solvent chemical mixtures can be subject to re-
exportation from destination countries. DEA believes that such exports 
of chemical mixtures should not be exempted since exports of these 
chemical mixtures could have significant potential for diversion. 
Therefore, these chemical mixtures, unless otherwise exempt, are 
subject to the export and other CSA chemical regulatory requirements.
    One commenter expressed concerns regarding the regulatory language 
found in 21 CFR 1310.08(l) stating that, ``Domestic and import 
transactions in chemical mixtures that contain acetone, ethyl ether, 2-
butanone, or toluene unless regulated because of being formulated with 
another listed chemical above the concentration limit'' shall be 
excluded transactions. The commenter stated that the regulatory 
language does not make it clear that this exemption applies if the 
mixture contains more than one of these chemicals (i.e. contains two or 
more of the following: acetone, ethyl ether, 2-butanone or toluene). 
The commenter expressed concerns that enforcement officials may deem 
chemical mixtures containing more than ``one'' of these solvents as 
regulated if the total quantity exceeded the List II concentration 
limits. DEA agrees. Therefore, DEA is modifying 21 CFR 1310.08(l) to 
read, ``Domestic and import transactions in chemical mixtures that 
contain acetone, ethyl ether, 2-butanone, and/or toluene, unless 
regulated because of being formulated with other List I or List II 
chemical(s) above the concentration limit'' shall be excluded.

Clarification of Concentration Limits

    As DEA stated in its Final Rule establishing concentration limits 
for the vast majority of chemical mixtures (69 FR 74957, December 15, 
2004), and

[[Page 10927]]

codified at 21 CFR 1310.14(c), mixtures containing a listed chemical in 
concentrations equal to or less than those specified in the ``Table of 
Concentration Limits'' are designated as exempt from specified 
provisions set forth in that section. The concentration limit is set at 
35 percent (by weight or volume) for the cumulative amount of acetone, 
methyl ethyl ketone (MEK), methyl isobutyl ketone (MIBK), toluene, and 
ethyl ether. Therefore, the table in 21 CFR 1310.14(c) specifies that 
for exports, the limit applies to the specific chemical or any 
combination of acetone, ethyl ether, 2-butanone, methyl isobutyl 
ketone, and toluene, if present in the mixture by summing the 
concentrations for each chemical. For example, an export involving a 
chemical mixture containing 20 percent acetone and 20 percent ethyl 
ether would not be exempt because the cumulative total of 40 percent 
exceeds the 35 percent concentration limit.

Final Action Taken in This Rulemaking

    After considering all comments, DEA has decided to exempt domestic 
and import transactions in chemical mixtures that contain acetone, 
ethyl ether, 2-butanone, and/or toluene under 21 CFR 1310.08 pursuant 
to 21 U.S.C. 802(39)(A)(iii) because regulation of such transactions 
has been determined to be unnecessary for the enforcement of the CSA. 
DEA determined that there is not a significant risk of domestic 
diversion for these chemical mixtures.

Specific Requirements That Will Apply to Regulated Chemical Mixtures 
Containing List II Chemicals Upon Publication of This Final Rule

    The above exemption only exempts such chemical mixtures from the 
domestic recordkeeping and import notification requirements. All other 
CSA chemical regulatory provisions, as specified in detail in the 
December 15, 2004 rule [69 FR 74957; corrected at 70 FR 294, January 4, 
2005], shall apply.

III. Exemption Authority

    The CSA authorizes DEA, pursuant to 21 U.S.C. 802(39)(A)(iii), to 
remove certain transactions in listed chemicals from the definition of 
a regulated transaction that are unnecessary for enforcement of the 
CSA. Based on comments to the Federal Register proposed rule 
``Exemption of Chemical Mixtures'' (63 FR 49506, September 16, 1998), 
DEA identified certain transactions in mixtures of acetone, ethyl 
ether, 2-butanone, and toluene that are unlikely sources for diversion. 
DEA was informed that tens of thousands of domestic transactions in 
these chemical mixtures occur annually. DEA determined that the 
regulation of domestic and import transactions in mixtures containing 
the chemicals acetone, ethyl ether, 2-butanone, and toluene were 
unnecessary for enforcement of the CSA and should be removed from the 
definition of a regulated transaction.
    Since the NPRM to this rulemaking did not discuss this exemption, 
the public did not have the opportunity to comment on the exclusion of 
these transactions from the definition of a regulated transaction.
    However, to avoid unnecessary burdens on affected companies during 
the pendency of proceedings in this matter, DEA decided to include as 
part of its December 15, 2004, Final Rule an interim rule, with request 
for comment, removing these transactions from the definition of a 
regulated transaction. Now that DEA has had the opportunity to solicit 
and review comments, the exemption is being finalized in this rule.

IV. Regulatory Certifications

Regulatory Flexibility Act

    DEA has become aware that a substantial number of chemical mixtures 
that are not useful to traffickers could potentially be regulated if 
the chemical mixtures that are subject to this rulemaking were not 
excluded from certain regulatory requirements. DEA determined that the 
regulation of these chemical mixtures is not necessary for enforcement 
of the CSA. Therefore, DEA decided to exempt these chemical mixtures 
from regulatory controls by exemption of certain types of transactions.
    DEA notes that the List II solvent chemicals acetone, ethyl ether, 
2-butanone, and toluene contribute to the largest number of potentially 
regulated chemical mixtures of List II chemicals. To limit the number 
of potentially regulated chemical mixtures to those necessary for 
enforcement of the CSA, DEA decided to define all domestic and import 
transactions of mixtures in these List II solvent chemicals as exempt 
transactions. This exemption applies to all persons that handle these 
chemical mixtures and not only to those who are represented in the 
comments. DEA previously implemented this exemption and is finalizing 
the exemption in this rulemaking.
    In accordance with the Regulatory Flexibility Act (5 U.S.C. 
605(b)), the Deputy Administrator has reviewed this regulation and by 
approving it certifies that this regulation will not have a significant 
economic impact upon a substantial number of small entities.

Executive Order 12866

    This regulation has been drafted and reviewed in accordance with 
Executive Order 12866, Section 1(b), Principles of Regulation. DEA has 
determined that this rule is a ``significant regulatory action'' under 
Executive Order 12866, Section 3(f), Regulatory Planning and Review, 
and accordingly this rule has been reviewed by the Office of Management 
and Budget. This rule finalizes an exemption for domestic and import 
transactions involving the List II chemicals acetone, ethyl ether, 2-
butanone, and toluene.

Executive Order 12988

    This regulation meets the applicable standards set forth in 
Sections 3(a) and 3(b)(2) of Executive Order 12988.

Executive Order 13132

    This rulemaking does not preempt or modify any provision of state 
law; nor does it impose enforcement responsibilities on any state; nor 
does it diminish the power of any state to enforce its own laws. 
Accordingly, this rulemaking does not have federalism implications 
warranting the application of Executive Order 13132.

Unfunded Mandates Reform Act of 1995

    This rule will not result in the expenditure by state, local, and 
tribal governments, in the aggregate, or by the private sector, of 
$118,000,000 or more in any one year, and will not significantly or 
uniquely affect small governments. Therefore, no actions were deemed 
necessary under the provisions of the Unfunded Mandates Reform Act of 
1995.

Congressional Review Act

    This rule is not a major rule as defined by Section 804 of the 
Small Business Regulatory Enforcement Fairness Act of 1996 
(Congressional Review Act). This rule will not result in an annual 
effect on the economy of $100,000,000 or more; a major increase in 
costs or prices; or significant adverse effects on competition, 
employment, investment, productivity, innovation, or on the ability of 
United States-based companies to compete with foreign-based companies 
in domestic and export markets.

Paperwork Reduction Act

    This rulemaking finalizes an exemption provision which reduced the 
paperwork burden on handlers of acetone, ethyl ether, 2-butanone and 
toluene. By exempting domestic and import transactions involving 
chemical mixtures containing these List II chemicals DEA is not 
subjecting these

[[Page 10928]]

transactions to CSA recordkeeping and reporting requirements. Domestic 
and import transactions involving chemical mixtures containing acetone, 
ethyl ether, 2-butanone and toluene are not subject to the following 
information collections: DEA information collection 1117-0023: Import/
Export Declaration for List I and List II Chemicals [imports only]; and 
DEA information collection 1117-0029: Annual Reporting Requirement for 
Manufacturers of Listed Chemicals.

List of Subjects In 21 CFR Part 1310

    Drug traffic control, List I and List II chemicals, Reporting and 
Recordkeeping requirements.


0
For the reasons set out above, 21 CFR part 1310 is amended to read as 
follows:

PART 1310--[AMENDED]

0
1. The authority citation for part 1310 continues to read as follows:

    Authority: 21 U.S.C. 802, 827(h), 830, 871(b), 890.

0
2. Section 1310.08 is amended by revising paragraph (l) to read as 
follows:


Sec.  1310.08  Excluded Transactions.

* * * * *
    (l) Domestic and import transactions in chemical mixtures that 
contain acetone, ethyl ether, 2-butanone, and/or toluene, unless 
regulated because of being formulated with other List I or List II 
chemical(s) above the concentration limit.

    Dated: March 1, 2007.
Michele M. Leonhart,
Deputy Administrator.
 [FR Doc. E7-4314 Filed 3-9-07; 8:45 am]
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