Consumer Product Safety Commission: A More Active Role in Voluntary Standards Development Should Be Considered
Published: 2012-05-21T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Growing numbers of recalls in 2007 and 2008, particularly of childrens products, focused increased attention on CPSC. Consumer products can be subject to mandatory or voluntary standards, or both. Questions have been raised about the level of compliance with voluntary standards and CPSCs ability to encourage compliance. The Consolidated Appropriations Act of 2012 directed GAO to analyze manufacturers compliance with voluntary industry standards. This report evaluates (1) what is known about the extent to which manufacturers comply with voluntary standards for consumer products, (2) CPSCs authority and ability to require compliance with voluntary standards, and (3) the consequences for manufacturers that fail to comply with voluntary standards.
To do this, GAO reviewed CPSCs statutory and regulatory authorities to encourage compliance with voluntary standards; reviewed agency documents and literature on consumer product safety; analyzed data on CPSC corrective actions; and met with representatives from national consumer, industry, legal, and standard-setting organizations who have expertise in developing consumer product safety standards.
section_title: What GAO Found
paragraphs: Although the Consumer Product Safety Commission (CPSC) enforces compliance with mandatory federal safety standards, it is also required by law to rely on voluntary safety standards when it determines that the standard adequately addresses the product hazard and is likely to have substantial compliance. Voluntary standardsdeveloped by industry, consumer, and government participants through a consensus processcover many of the thousands of types of products in CPSCs jurisdiction. Compliance with voluntary standards is not routinely tracked, but it is generally considered to be high by industry participants. Compliance with these standards also depends on industry and legal factors, such as retailer requirements to demonstrate proof of compliance with voluntary safety standards and risk of liability in product liability lawsuits.
Because voluntary standards do not have the force of law, CPSC cannot compel compliance with them. However, noncompliance with a voluntary standard can inform a determination of a substantial product hazard by the CPSC that in turn can lead to CPSC enforcement actions. CPSC has exercised its expanded authority to place a product on the substantial product hazards list. Specifically, it designated drawstrings from childrens upper outerwear and hair dryers without a ground fault circuit interrupter as hazardous products, and Customs has seized violative items at ports. CPSC also participates in standard development activities with industry and consumer representatives and monitors select voluntary standards. CPSC attends standard development meetings, supplies hazard and injury data and analysis, and provides input on draft standards. However, CPSCs regulation prohibits staff from voting on the final standards or from participating in any meeting that excludes other groups, such as media or consumers. CPSCs rationale for limiting involvement in standards development activity is to maintain its independencesuch as not appearing to endorse a specific standard. Office of Management and Budget guidance gives agencies discretion to determine their level of participation in standard setting activities, including full involvement in discussions, serving in leadership positions, and voting on standards. A January 2012 White House memorandum states that the federal government may need to be actively engaged in standards development and implementation, including playing an active role in standard setting and assuming leadership positions in Standard Development Organization committees. Committee participants GAO spoke to value CPSCs input but generally agreed that CPSC should participate earlier and take a more active role in standards development. These actions could enhance CPSCs oversight, and may strengthen voluntary standards.
Manufacturers that fail to comply with voluntary standards can face consequences when CPSC has determined that noncompliance poses a significant risk of injury or death to consumers. CPSC can take corrective action against the manufacturer, including recalls, or take longer term action to ban the hazardous product. CPSC has focused much of its surveillance and compliance work on imported products. For fiscal years 2008 through 2011, 80 percent of CPSC recalls have been of imported products that may be subject to voluntary standards, highlighting challenges CPSC faces in helping to ensure the safety of consumer products.
section_title: What GAO Recommends
paragraphs: To strengthen the adequacy of voluntary standards, CPSC should review the policy for participating in voluntary standards development activities and determine the feasibility of assuming a more active, engaged role in developing voluntary standards. CPSC supported the recommendation.

section_title: Letter
paragraphs: Growing numbers of recalls in 2007 and 2008, particularly of toys and  other children’s products, focused increased attention on the Consumer  Product Safety Commission (CPSC). On August 14, 2008, the Consumer  Product Safety Improvement Act (CPSIA) was enacted to reform CPSC  and strengthen its authority to enforce consumer product safety  standards. Many safety standards covering consumer products are  known as voluntary standards, developed by industry, consumer, and  government representatives through a consensus process. Questions  have been raised about the level of compliance with voluntary standards  and CPSC’s ability to encourage compliance.
Voluntary standards are generally determined by standard-setting  organizations, with input from government representatives and industry  groups, and are also referred to as “consensus standards.” These  voluntary standards do not have the force of law. Amendments in 1981 to  the Consumer Product Safety Act (CPSA)—CPSC’s original authorizing  legislation—directed CPSC to defer to voluntary standards rather than  issue mandatory standards if it determines that the voluntary standard  adequately addresses a potential product hazard and that there is likely to  be substantial compliance with it.support for 174 new, revised, or reaffirmed voluntary standards from fiscal  years 2007 through 2011, according to CPSC reports.
CPSC monitored or provided technical  In the Consolidated Appropriations Act, 2012 Congress directed us to  analyze compliance with voluntary industry standards for consumer   In this report, we evaluate (1) what is products overseen by CPSC. known about the extent to which manufacturers comply with voluntary  standards for consumer products, including inexpensive imported  products; (2) CPSC’s authority and ability to require compliance with  voluntary standards; (3) the consequences for manufacturers that fail to  comply with voluntary standards; and (4) CPSC’s efforts to identify  patterns of noncompliance.
To address these objectives, we reviewed CPSC’s statutory and  regulatory authority to encourage compliance with voluntary standards.  We also reviewed CPSC’s standard operating procedures, performance  and accountability reports, budget documents, and our relevant prior  reports. We met with cognizant CPSC officials to discuss their authorities  and their ability to enforce them, including all of CPSC’s current  commissioners and the Chairman. Additionally, we obtained and  analyzed data from CPSC’s compliance databases to identify (1) the  number of reported instances of noncompliance; (2) the number of times  these instances led to a corrective action; (3) the numbers of corrective  actions that resulted; (4) the number of product units recalled; and (5) the  type of standard, if any, that covered the product. We assessed the  reliability of these data by reviewing existing information about the data  and the system that produced them, and interviewing agency officials  knowledgeable about the data and related management controls. Based  on this assessment, we determined the data to be sufficiently reliable for  the purposes of this report. We interviewed the three standards  development organizations that coordinate the development of more than  90 percent of voluntary standards developed with CPSC staff technical  support. We obtained testimonial and documentary information from  national consumer, industry, and legal organizations that have expertise  in working on voluntary standards development for consumer products.  See appendix I for additional information on our scope and methodology.
We conducted this performance audit from January 2012 to May 2012 in  accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives.
subsections: section_title: Background
paragraphs: CPSC was created in 1972 by the Consumer Product Safety Act to  regulate certain consumer products and address those that pose an  unreasonable risk of injury; assist consumers in using products safely;  and promote research and investigation into product-related deaths,  injuries, and illnesses. According to CPSC, this jurisdiction covers  thousands of manufacturers and types of consumer products. CPSC does  not have jurisdiction over some categories of products, including  automobiles and other on-road vehicles, tires, boats, alcohol, tobacco,  firearms, food, drugs, cosmetics, medical devices, and pesticides. Other  federal agencies—the National Highway Traffic Safety Administration,  U.S. Coast Guard, Department of Justice, Department of Agriculture,  Food and Drug Administration, and Environmental Protection Agency— have jurisdiction over these products.
CPSC has jurisdiction over thousands of types of consumer products and  hazardous substances, many of which are subject to mandatory  regulations or voluntary standards, or both. Mandatory standards are  federal rules set by statute or regulation that define the requirements  consumer products must meet. These standards establish performance  and labeling criteria that products must meet before they are  manufactured, imported, distributed, or sold in the United States. CPSC  may set a mandatory standard when it determines that a voluntary  standard would not eliminate or adequately reduce a risk of injury or finds  that substantial compliance with a voluntary standard would be unlikely.  The Commission also may impose a mandatory ban of a hazardous  product when it determines that no feasible consumer product safety  standard adequately would protect the public from an unreasonable risk  of injury. In some cases, Congress has enacted a specific statutory  requirement for CPSC to create a mandatory standard, or convert a  voluntary standard to a mandatory standard. For instance, CPSIA  mandated the conversion of voluntary standards for durable infant and  toddler products, all-terrain vehicles, and children’s toys to mandatory  standards. Mandatory standards and bans are enforceable by CPSC,  allowing the agency to stop imported products that do not meet federal  requirements at ports and seek civil or criminal penalties for violations of  the mandatory standards or bans. Approximately 200 products are  currently regulated and subject to mandatory standards, including  automated garage door openers, fireworks, and children’s cribs.
Many consumer products under CPSC’s jurisdiction, including smoke  alarms, candles, and portable generators, are subject to voluntary  standards. More than 700 standards development organizations (SDO) develop most voluntary standards used in the United States, including  safety standards. SDOs include private-sector professional and technical  organizations, trade associations, and research and testing entities.  According to CPSC, three SDOs—Underwriters Laboratories, Inc. (UL);  ASTM International; and the American National Standards Institute  (ANSI)—coordinate the development of more than 90 percent of  voluntary standards developed with CPSC staff technical support.  Participants in the standards development process include  representatives from government agencies, manufacturers, consumers,  retailers, testing laboratories, technical experts, and other interested  parties. In general, most SDOs operate by principles that govern the  voluntary standards process, such as openness, balance, consideration  of views and objections, consensus vote, and the right to appeal. The  process of developing consensus standards is designed to be  transparent, with written procedures covering each step. Participation in  the standard development process is intended to be voluntary. Standards  developed by an SDO are considered the property of the SDO. CPSC  officials told us that once a standard is published and copyrighted,  members of the public and government agencies generally must  purchase them.
The National Institute of Standards and Technology (NIST), the federal  agency that coordinates standard activities, maintains a database of  standards that have been incorporated by reference into federal  regulations. NIST also has online search tools that members of the public  may use to locate other standards—including voluntary standards not  incorporated by reference into federal regulations—but according to  agency officials, the agency does not collect or maintain voluntary  standards.
CPSC’s voluntary standards activities are overseen by a Voluntary  Standards Coordinator, appointed by the Commission’s Executive  Director. The coordinator is the senior agency official responsible for  managing the Commission’s voluntary standards program. One of the  coordinator’s main duties is to prepare and submit to the Commission a  semiannual summary of staff’s voluntary standards activities. Duties also  include providing advice and recommendations for the development of  new voluntary standards or the revision of existing voluntary standards, in  conjunction with CPSC management. The coordinator also proposes  policies and guidelines concerning voluntary standards activities, reviews  associated public comments, and prepares recommended policies for  approval by the Commission. The coordinator works with SDOs, and  recommends and trains CPSC staff to serve as technical experts to those  organizations. Further, the coordinator is the liaison to industry  associations, other government agencies, and any other group interested  in voluntary standards.
CPSC’s Office of Compliance and Field Operations, currently with 166  staff, has primary responsibility for helping ensure compliance with  product safety standards. Its activities include enforcing mandatory  standards and reporting requirements, investigating product hazards, and  determining corrective actions (such as recalls) for manufacturers not in  compliance with safety standards. CPSC also has an Office of Import  Surveillance and Inspection that coordinates enforcement efforts with  U.S. Customs and Border Protection to help ensure import compliance  with safety standards. CPSC has investigators stationed at some ports of  entry to assist in surveillance activities. In a past report, we made  recommendations to strengthen CPSC’s ability to target unsafe consumer  products, especially imported products. We recommended that CPSC  work to educate foreign manufacturers about U.S. product safety  standards and best practices, including the importance of complying with  voluntary standards. CPSC concurred with our recommendation. The  2011-2016 Strategic Plan states that CPSC has been seeking to create  and strengthen partnerships with domestic and international stakeholders,  including foreign regulators and manufacturers, to improve product safety  throughout the supply chain. Also, CPSC’s Office of Education, Global  Outreach, and Small Business Ombudsman has separately developed  and issued plans for addressing consumer product safety on a country- specific and regional basis.
section_title: Standards Development Process, Industry Certification, and Legal Factors Help Ensure Compliance with Voluntary Standards
paragraphs: Industry representatives and consumer groups we spoke to said that  compliance with voluntary standards developed through the consensus  process is generally considered to be high, although they do not track  compliance. Some representatives and consumer groups said that it can  reach 90 percent for some standards. However, consumer product safety  experts suggested that standards for some products have lower  compliance, especially commonly low-priced items, products primarily  sold over the Internet or by nonconventional retailers, products made by a  large number of manufacturers, or products primarily manufactured  overseas. For instance, cigarette lighters manufactured overseas and  sold at low prices in the United States have been found to be  noncompliant with voluntary standards.
subsections: section_title: Standards Developed through a Consensus Process with Open Participation Generally Gain High Compliance
paragraphs: Consumer product safety experts we spoke to generally said that industry  prefers voluntary to mandatory standards. They noted the voluntary  standard development process is faster than mandatory rulemaking, and  allows the industry a greater level of input. According to CPSC, the time  required for mandatory rulemaking varies depending on the complexity of  the product or of the rule requirements, the severity of the hazard, and  other agency priorities, among other factors. For example, a legal expert  told us that a mandatory rulemaking for cigarette lighters took 10 years  from the decision to take action to final rule. CPSC also has been  considering a mandatory rule to address the risk of fire associated with  ignitions of upholstered furniture since 1972. Generally, the flexible  process for developing voluntary standards is considered to facilitate  revisions to the standards. Working through SDOs, interested parties  have been able to revise existing standards to respond in a timely manner  to emerging hazards or risks. According to two legal experts, a  disadvantage of mandatory standards is that revision or repeal can be  difficult. One expert also told us that because mandatory standards set  fixed requirements for product safety, the rules can stifle product  development and innovation.
Industry participants told us that advantages of the voluntary standards  process include open participation and proceedings by consensus, which  can help ensure compliance with the resulting standards. Other industry  representatives said that they also invest considerable time and  resources in writing standards, which raises the likelihood of compliance.
Factors that affect compliance for some manufacturers include discerning  and accessing applicable standards. Some consumer product safety  experts told us that some small businesses and foreign manufacturers  are not aware of applicable standards for their products. CPSC has  responded by extending greater outreach to these businesses through  the agency’s Office of Education, Global Outreach, and Small Business  Ombudsman. The office coordinates with, and provides education and  outreach activities to, various domestic and international stakeholders,  including manufacturers, retailers, resellers, small businesses, and  foreign governments. Among its responsibilities, the office works with  foreign governments and regulatory bodies to help them increase their  capacity to develop voluntary and mandatory product safety standards  and plans to develop information and guidance tailored specifically to  small batch manufacturers. Staff from this office plan to update the CPSC  web page to assist small businesses in learning about their obligations  under CPSIA, by informing them about voluntary standards, and  encouraging them to comply. CPSC also plans to conduct two extended  training exchanges with foreign partners, including developing country  officials, to increase foreign regulatory agencies’ understanding of CPSC  procedures and policies and help ensure that CPSC safety standards are  met for U.S.-bound exports.
section_title: Some Retailers and Industry Associations Require Proof of Compliance with Voluntary Safety Standards to Sell Consumer Products
paragraphs: Although not legally mandated for voluntary standards, some retailers  require a certification mark or other proof of compliance from  manufacturers before they will agree to sell their product in stores. For  instance, according to a legal expert, specialty retailers who sell gas  fireplaces require proof of adherence to a new standard, which is being  revised to address a safety hazard, for glass panels for the front of gas  fireplaces. For many products, consumers and retailers expect that they  meet a minimum safety standard, such as a voluntary standard. Some  retailers conduct their own product safety programs, often certifying  compliance with safety standards through testing at third-party labs, to  better ensure the safety of products sold in their stores.
In addition, some industry associations have programs to certify  compliance with voluntary standards applicable to their members’  products. Entities found not to be in compliance with applicable  standards could lose the right to bear the association’s certification mark.  Industry associations that have certification programs include the furniture  industry and children’s products manufacturers. One furniture association  provides hang tags to members who have paid to certify their  conformance with the industry-developed standards, primarily addressing  fire hazards. A group representing children’s products manufacturers has  implemented a lab testing and inspection process to certify members’  compliance with applicable standards. Manufacturers contract with the  industry group to receive certification that their products, such as cribs,  strollers, and baby walkers, comply with standards.
section_title: Certain Industries Prefer Mandatory Standards to Ensure a Level Playing Field and Preempt State Laws
paragraphs: Although industry representatives and legal experts we spoke to said that  manufacturers largely prefer voluntary over mandatory standards, they  also told us that certain industries have sought mandatory standards. Two  reasons were cited for an industry’s preference for mandatory standards:  first, to level competition across an industry sector, especially where  some manufacturers were not complying with the voluntary standard to  which the rest of the industry agreed; and second, to preempt divergent  state laws. The Lighter Association, a group representing cigarette  lighter manufacturers, petitioned CPSC in 2001 to adopt the prevailing  voluntary standard for lighters as a mandatory standard. The association  cited widespread noncompliance with the voluntary standard, especially  for lighters imported from China. Although CPSC has not as yet  promulgated a general rule for mechanical requirements for cigarette  lighter safety, it had adopted a regulation requiring child-resistant  mechanisms for disposable lighters in 1994. A legal expert who has  worked with the arts and creative materials industry told us that the  industry sought to convert the industry’s voluntary standard, developed  with input from consumers and product users, to a mandatory standard to  preempt differing laws in at least seven individual states.
section_title: Risk of Potential Liability in Product Liability Lawsuits Helps Ensure Industry Compliance with Voluntary Safety Standards
paragraphs: Potential liability in product liability lawsuits for noncompliance with  voluntary standards is another factor that affects compliance. Consumer  product safety experts also told us that the risk of incurring reputational  and financial costs associated with product liability lawsuits provides an  incentive for manufacturers to comply with voluntary standards. Courts  generally consider noncompliance with a voluntary standard as relevant  evidence to establish a product defect or to prove a case of negligence.  By the same token, if litigants can show compliance with applicable  voluntary standards, the compliance may provide evidence of lack of a  product defect or negligence. However, evidence of compliance usually is  not sufficient on its own to negate liability.
section_title: While CPSC Cannot Legally Require Compliance with Voluntary Standards, Industry Monitoring and Participation in Standards Development Help Encourage Compliance
paragraphs: CPSC cannot compel compliance with voluntary standards. However,  according to CPSC officials, the agency has requested that U.S. Customs  and Border Protection seize at the ports defective products that are  subject to voluntary standards and that constitute a substantial product  hazard. CPSC also participates in voluntary standard development  activities, although their effectiveness is limited by constrained resources  and a restrictive meetings policy. While consumer product safety experts  value CPSC’s input, they generally agree that earlier and more active  participation could increase CPSC’s efficiency and effectiveness in  developing standards.
subsections: section_title: Though Voluntary Standards Do Not Have the Force of Law, CPSC Is Using Expanded Legal Authority to Seize Defective Products
paragraphs: Since voluntary standards do not have the force of law, the Commission  cannot compel compliance with them. Noncompliance with a voluntary  standard, however, can inform a determination of a substantial product  hazard by the CPSC. The CPSA defines a substantial product hazard as  a failure to comply with an applicable consumer product safety rule, which  creates a substantial risk of injury to the public; or a product defect, which  (because of the pattern of defect, the number of defective products  distributed in commerce, the severity of the risk, or otherwise) creates a   If the CPSC finds that a product  substantial risk of injury to the public.presents a substantial product hazard, it can lead to an enforcement  action, such as a public notice or recall. Consequences for  noncompliance with voluntary standards that amount to a substantial  product hazard are discussed in the next section of this report.
We found that CPSC does not routinely track broad product compliance  with voluntary standards. Although they have internal guidance for  monitoring compliance with voluntary standards, CPSC officials said that  the agency has not conducted a formal program to test for product  conformance with voluntary standards since 2002. The agency cited  limited resources and competing priorities, including Congressional  mandates and monitoring mandatory standards, as reasons for not doing  so. According to CPSC officials, following the enactment of CPSIA in  2008, the agency reallocated resources from voluntary standards  activities towards meeting mandatory rulemaking deadlines required in  the act.
With the enactment of CPSIA in 2008, CPSC was granted expanded legal  authority relative to certain voluntary standards under section 15(j) of the  Consumer Product Safety Act to create a substantial product hazard list.It allows the Commission to issue a rule for any consumer product or  class of products identifying certain characteristics whose presence or  absence must be deemed a substantial product hazard. CPSC must  determine that the characteristics are readily observable and that the  hazard has been addressed by voluntary standards. CPSC must also  determine that voluntary standards have been effective in reducing the  risk of injury from the products and there is substantial compliance with  the voluntary standards. When CPSC publishes a rule making such  determinations, the products involved are subject to all of the  enforcement consequences that apply to a substantial product hazard.  Among other actions, the product must be refused admission into the  United States. CPSC works cooperatively with Customs and Border  Protection staff at ports of entry to detect and seize defective products.  Agency officials stated that, to date, CPSC has twice exercised authority  under section 15(j) to identify products containing substantial product  hazards: children’s upper outerwear containing drawstrings, because of  risk of strangulation; and hand-supported hair dryers without integral  immersion protection, due to risk of electric shock.
We spoke with legal experts to discuss their views on the CPSC’s  expanded authority to declare substantial product hazards. Two legal  experts told us that exercising the authority essentially converts a  voluntary standard to a mandatory one without undergoing the  established rulemaking procedures. According to one expert, the  expanded authority gives the CPSC the ability to use the voluntary  standards that were intended to address design and performance issues  to create a mechanism for seizure of defective products at the ports,  without putting the burden of proving a substantial product hazard on the  CPSC. Another product safety expert also said that the expanded  authority will not substantially enhance CPSC’s enforcement capability  because inspectors must have the ability to readily observe the hazard at  the port of entry. Some hazards are not readily observable and require  testing for compliance, such as lead content. CPSC told us that while the  section 15(j) authority allows them to respond more quickly to substantial  product hazards, not enough time has passed to assess the effect this  authority will have on helping ensure compliance with voluntary  standards.
section_title: CPSC Participates in Standards Development Activities, but Its Effectiveness is Limited by Resource Constraints and a Restrictive Meetings Policy
paragraphs: CPSC staff participate in the voluntary standard development process by  providing expert advice, technical assistance, and information based on  data analyses of the numbers of and causes of deaths, injuries, or  incidents associated with the product. According to CPSC, it supplies the  standard-setting bodies with epidemiological and health science data,  including extrapolated injury and death data from hospitals; death  certificates associated with products causing the death where available;  anecdotal data; and incident reports from SaferProducts.gov.officials said that support of voluntary standards development can be  moderate or intensive. They told us that a moderate level of support  would include reading the minutes of subcommittee meetings and  monitoring the proceedings. More intensive support may consist of  conducting and presenting CPSC research, performing lab tests, and  writing draft language for the standard.
CPSC officials told us that in developing voluntary standards, CPSC  interacts primarily with ASTM International for children, juvenile, toddler,  and infant products; ANSI for products such as bicycles and garage door  operators; and UL for electrical products. CPSC staff told us they have a  representative who serves as a nonvoting member on the board at ANSI  and on ANSI’s accrediting council.  According to ANSI representatives,  CPSC staff participate in discussions related to accrediting and  maintaining procedures for international standards. Representatives from  UL told us that CPSC staff participate in UL’s Consumer Advisory  Council, which convenes at least once a year to discuss products and  standards.
ANSI’s role in standards development differs from that of SDOs. ANSI serves as  administrator and coordinator of the U.S. private sector, voluntary standardization system.  ANSI also accredits U.S. standards developers using criteria based on international  requirements. SDOs accredited by ANSI include ASTM International, UL, and the National  Fire Protection Association. support or monitored the development of 60 voluntary safety standards.  These standards addressed hazards associated with cradles and  bassinets, children’s play yards, portable generators, and garage door  openers, among other products. According to CPSC’s Operating Plan, the  agency plans to monitor 68 voluntary standards in fiscal year 2012,  including standards addressing tip-over hazards of kitchen ranges,  cadmium levels in children’s jewelry, strangulation risk posed by window  blind cords, and sulfur emissions in drywall (see table 1).
CPSC officials told us that voluntary standards monitoring activity  decreased substantially after the enactment of CPSIA because of  reallocation of resources to meet the act’s requirements. The number of  standards selected for monitoring was at a 5-year low in fiscal year 2009;  however, the number of voluntary standards selected for monitoring has  increased in the past 3 fiscal years and is expected to continue at current  levels in the near future. CPSC officials said that staff recommendations  based on criteria, such as death and injury data, available resources, and  exposure of vulnerable populations to hazards, guide the selection of  standards to monitor. They told us that staff consider where participation  in voluntary standard setting could help reduce unreasonable risk of injury  posed by a product. Management considers and approves or rejects the  staff recommendations based on Commission priorities and available  resources. Staff approved recommendations are then sent to the  Commission for final approval. According to CPSC’s Operating Plan and  Performance Budget, the agency plans one recommendation to voluntary  standards or revisions to code organizations for fiscal year 2012. The  Operating Plan also includes plans for two new data analysis or technical  review activities on carbon monoxide alarms and enhanced smoke  alarms. Additionally, 10 activities related to nanotechnology in consumer  products are planned for fiscal year 2012. These activities will identify  the potential release of nanoparticles from selected consumer products  and determine the potential health effects from such exposure, which may  lead to CPSC participation in voluntary standards development, according  to CPSC officials.
CPSC officials said that the level of support provided by CPSC to  standards development and monitoring is dependent on available  resources. One CPSC staff member is assigned to each standard as a  project manager responsible for monitoring committee activity and draft  revisions. According to CPSC officials, the 68 standards to be monitored  in fiscal year 2012 represent the limit the agency can handle given current  resource and staff levels. For example, about 25 staff are responsible for  monitoring the activities related to these standards. Sixty-eight standards  is a small fraction of standards developed for consumer products. For  instance, ASTM International has developed more than 12,000 standards  while UL maintained more than 1,400 as of 2011. These standards cover  many types of products, not exclusively consumer products.
CPSC’s relationship with SDOs is outlined in CPSC regulations.policy sets criteria for deciding on CPSC’s involvement in voluntary  standards activities. The criteria include:  the likelihood the voluntary standard will eliminate or adequately  reduce the risk of injury addressed, the likelihood that there will be substantial and timely compliance with  the voluntary standard, the likelihood that the voluntary standard will be developed within a  reasonable period of time, openness to all interested parties, establishment of procedures to provide for meaningful participation in  the development of standards by representatives of a variety of  interested parties, and due process procedures.
CPSC’s regulation guides the extent and form of CPSC staff involvement  in voluntary standards organizations. Staff may attend standards  development meetings, take an active part in the discussions, and  provide data and explanatory material, but CPSC’s regulation prohibits  staff from voting on the standards or from holding leadership positions in  standards development committees. Except in extraordinary  circumstances and with the approval of the Executive Director, they  cannot become involved in standards development meetings that are not  open to the public (including members of the media) for attendance and  observation. This may include technical subcommittees largely  comprised of industry representatives. The regulation also states that  active involvement in standards development activity must not be done in  a manner that might present an appearance of preferential treatment for  one organization or group or put CPSC’s impartiality at risk.
CPSC has authority to revise its regulations pertaining to voluntary  standards activities. The first regulation concerning involvement in  standards development was issued in 1978, and revised in 1989 and  again in 2006. According to CPSC, its regulation is similar to the Office of  Management and Budget’s (OMB) Circular No. A-119 (Revised), which  provides guidance for agencies participating in voluntary consensus  standards bodies. However, in our review of CPSC’s regulation, we found the agency interpreted its level of participation more strictly than  OMB guidance for such activities as voting on standards and taking  leadership positions. CPSC’s rationale for limiting involvement in  standards development activity, as described in its regulation, is to  maintain its independence—such as not appearing to endorse a specific  standard. OMB guidance states that agency representatives should  participate actively and on an equal basis with other members, including  full involvement in discussions, technical debates, registering of opinions,  and if selected, serving in leadership positions. According to OMB  guidance, agency representatives may vote at each stage of the  standards development process unless prohibited by law or their  agencies. A January White House memorandum further outlines  principles for federal government engagement in standards activities,  especially where statute, regulation, or administration policy identifies a  national priority. Specifically, it states that the federal government may  need to be actively engaged or play a convening role to accelerate  standards development in standard setting and implementation, including  supporting leadership positions for federal agency staff in SDO  committees.
section_title: Consumer Product Safety Experts Value CPSC’s Input, but Also Called For Earlier and More Active CPSC Participation
paragraphs: CPSC, consumer groups, and industry officials with whom we spoke  generally viewed CPSC’s participation in voluntary standards  development activities favorably. Consumer groups and other consumer  product safety experts told us that CPSIA has strengthened CPSC’s  authority, effectiveness, and level of influence at SDOs. They also told us  that the industry now knows that if they do not develop an adequate  voluntary standard, CPSC will make a mandatory standard for those  products specified by CPSIA. According to consumer representatives who  have participated in the process, the dynamic has changed: prior to  CPSIA, CPSC’s input was ignored or voted down. With their new  authority, CPSC is more active and their input is incorporated a great deal  more, resulting in stronger and more protective outcomes, especially for  durable goods for infants. Consumer group representatives also told us  that CPSC’s involvement in standards development has been effective for  helping ensure consumer participation, especially since the passage of  CPSIA. In one instance, a consumer group had concerns about the  standards development process for window blind cords because of what it  thought was a lack of transparency, limited access to information, and  lack of consideration of its views, after they were excluded from  participating in a technical subcommittee. CPSC appealed directly to  industry groups to open the process, and consumer groups eventually  were allowed to participate in the window blinds standard development.
CPSC officials told us that staff’s effectiveness in standards development  partially depends on their own persuasiveness and the direction given  from top management. Management recommends and approves staff to  participate in standards development activity based on their ability to  listen, negotiation skills, analytical proficiency, and level of technical and  scientific expertise. Staff also receive training from the Voluntary  Standards Coordinator to prepare for SDO meetings. According to CPSC  officials, staff selected to participate in standards development activities  may seek further advice and training from the Voluntary Standards  Coordinator and other colleagues as needed.
While consumer product safety experts we spoke to said that CPSC has  good working relationships with the SDOs, some added that the agency  could take a more active role in standards development activities.  Voluntary standard committee participants told us that they value CPSC’s  contributions during standards development, one group especially valued  its incident data and analysis, and another appreciated the agency’s  ability to help ensure an inclusive process. One industry official told us  that they work collaboratively with CPSC; for example, they receive data  from the CPSC in the process of developing voluntary standards for  particular products. In one case, CPSC had identified, through its incident  data, a laceration hazard resulting from a certain design of high chair with  two hooks on the back. CPSC communicated this information to industry  representatives, and it was incorporated into the voluntary standard  process for the product. Another industry stakeholder told us that CPSC  is viewed as a valuable partner in stronger standard development. By  simply being present at voluntary standards development meetings,  CPSC shows the industry that it is monitoring their activities.
Other consumer product safety experts said that CPSC’s participation in  committees could be more active and its position on the draft standards  better articulated. Because of limitations stemming from CPSC’s  regulation governing staff participation in standards development activity,  the resulting standard may not fully reflect the CPSC staff input and the  standard development process can be delayed. According to some  consumer product safety experts, CPSC staff are restrained and act  largely as observers at standard development committee meetings.  Others said that, at times, CPSC staff does not challenge the adequacy of  the standards. For example, although CPSC converted the voluntary  standard for all-terrain vehicles to a mandatory standard in 2009, as  required by CPSIA, in the view of some experts, all-terrain vehicles  remain covered by a weak standard. In public statements regarding the  all-terrain vehicle standard, one CPSC commissioner said that the recent  update to the standard, while not diminishing the safety of the product,  remains a low threshold for federal safety standards. Our analysis of  CPSC public recall notices showed that there have been 36 recalls of all- terrain vehicles involving 15 companies for fiscal years 2007 through  2011. Manufacturers have recalled all-terrain vehicles for reasons such  as a risk of a crash caused by pieces of the main suspension breaking off  and a risk of loss of vehicle control due to faulty speed controls. Recall  notices do not indicate if the hazards posed by the product are covered  by voluntary or mandatory standards. In discussions with consumer  product safety experts, they said that if CPSC challenged the adequacy of  the standards more frequently this would send a signal to industry that the  agency was committed to obtaining a high level of safety in voluntary  standards.
Some industry representatives emphasized that they wanted CPSC’s  more active and earlier participation in standards development. They said  that they would benefit from more information about CPSC’s views on  specific provisions of a standard, such as certain performance  requirements, level of risk tolerance, or aspects of a product CPSC  wanted changed. Some industry representatives said that if the agency’s  position on a standard were more apparent from the outset, the process  would be faster and more efficient, which could result in stronger  standards. One industry representative also noted that more active and  earlier participation would allow CPSC to consider unforeseen business  consequences of their proposed revisions to standards earlier in the  process. For instance, according to this industry representative a revised  standard for child bed rails was delayed by CPSC proposing costly  revisions after the standard had already been approved by SDO  participants.
section_title: CPSC Can Impose Corrective Actions When Noncompliance with Voluntary Standards Presents a Substantial Product Hazard
paragraphs: Manufacturers can face consequences ranging from civil monetary  penalties to the reputational and financial losses associated with  corrective action if their products fail to comply with voluntary standards  and if they present a substantial product hazard. Corrective actions  include recalls, which encompass refunds, replacements, or repairs.  CPSC may also sue to prevent distribution or sale of a product pending  completion of a recall proceeding. Although voluntary standards do not  have the force of law, manufacturers are legally required to report  substantial product hazards to CPSC. Every manufacturer of a  consumer product must inform the Commission if they obtain information  that reasonably supports the conclusion that the product contains a defect  that could create a substantial product hazard. Such a report may  include information the manufacturer obtained about a product outside  the United States if it is relevant to products sold or distributed in the   Manufacturers that knowingly fail to report potential  United States.substantial product hazards could be subject to civil or criminal penalties.  In 2011, CPSC negotiated out-of-court settlements in which five  companies agreed to pay $3.26 million in civil penalties related to their  failure to report substantial product hazards to the agency.
Although failure to meet a voluntary standard alone is not sufficient for  CPSC to take action against a company—because voluntary standards  are not enforceable by law—CPSC’s analysis of the evidence of  noncompliance and determination that the product could pose a  substantial product hazard can lead to corrective action. According to  CPSC’s interpretive regulations, compliance or noncompliance with  applicable voluntary standards may be a factor in determining whether a  substantial product hazard exists. To determine if corrective action is needed, CPSC staff review incident reports on a daily basis and forward  them to appropriate integrated teams for extensive analysis. CPSC  integrated teams comprise subject matter experts such as engineers,  human factors experts, health scientists, statisticians from the Office of  Hazard Identification and Reduction, and compliance officers from the  Office of Compliance. The teams then assess the reports for hazard type,  whether the incident affected vulnerable populations, and the severity of  injury. CPSC also collects data on injuries and deaths for products under  its jurisdiction, and staff conduct investigations on specific injury cases to  gain better knowledge of how the product was involved. Based on  analysis of these data, the integrated teams decide if further action would  be warranted, such as additional monitoring of the situation, an in-depth  investigation, or a product safety assessment. In our discussions with  CPSC officials, they told us that the agency decides on further actions  based on other agency priorities, resources, and the level of risk that a  product poses. Once CPSC has identified a hazardous product, the  agency will take action to remove the product from the market. If a recall  is necessary, CPSC staff negotiates with the responsible company to  seek a voluntary recall, if appropriate.
Manufacturers that report product defects propose a remedy that must be  deemed acceptable to CPSC staff. This often involves the product’s  recall, which consists of the purchase price refund, repair, or replacement  of the product. CPSC considers whether the plan adequately addresses  the risk of injury presented by the product. For example, if the  manufacturer’s proposed solution was to repair its product, CPSC  engineers would test the repair to determine if it addressed the hazard  adequately. Similarly, if the proposed solution was a refund, CPSC  officials would evaluate the refund process to determine if it would cause  undue burden to the consumer. CPSC takes steps to ensure that recalled  products are not reintroduced in the market through second-hand stores  by monitoring the internet and through market surveillance programs.  Table 2 contains information about CPSC’s recall activities for fiscal years  2007 through 2011 for products covered by mandatory standards and  those that are unregulated.
In our review of CPSC documents, the agency focused much of its  surveillance and compliance work on imported products. According to  CPSC, approximately 80 percent of recalls from 2008 through 2011 have  been of imported products. The agency’s Office of Import Surveillance  and Inspection has primary responsibility for product surveillance at ports  of entry in cooperation with other appropriate federal agencies. U.S.  Customs and Border Protection notifies CPSC and other regulatory  agencies with import safety responsibilities of the arrival of imported  products and provides information about those products. CPSC identifies  potentially unsafe products and requests that U.S. Customs and Border  Protection set them aside for CPSC examination. Once samples are  delivered to or taken by CPSC for examination, CPSC may detain the  shipment pending further examination and testing, conditionally release  the shipment to the importer’s premises pending examination and testing,  or release the shipment to the importer outright. Compliance investigators  examine the sample to determine whether it (1) complies with the relevant  mandatory standard or standards; (2) is accompanied by a certification of  compliance with relevant product safety standard that is supported by  testing, in some cases by a third party, (3) is or has been determined to  be an imminently hazardous product; (4) has a product defect that  presents a substantial product hazard; or (5) is produced by a  manufacturer who failed to comply with CPSC inspection and   According to a CPSC notice, from October  recordkeeping requirements.1, 2011, to December 1, 2011, officials identified about 240 noncompliant  products at ports of entry, including defective hair dryers, lamps, and  holiday lights.
Table 3 illustrates standards activities and recall actions for selected  products for fiscal years 2007 through 2011. Some products are covered  by both mandatory and voluntary standards, which may address different  aspects of the product features. For example, all-terrain vehicles, cribs,  infant bath seats, infant walkers, and cigarette lighters are subject to both  mandatory and voluntary standards.
section_title: CPSC Databases Do Not Identify Products with Voluntary Standards, but the Agency Collects Data That Could Help Identify Patterns of Noncompliance
paragraphs: CPSC has no tracking mechanism specific to voluntary standards in its  compliance database, but the agency can identify patterns of  noncompliance and address safety hazards. CPSC tracks reports of  noncompliance with mandatory standards and identifies potential product  hazards. CPSC has two internal databases for tracking noncompliance  one for regulated products (products subject to mandatory standards) and  the other for products that could pose a substantial product hazard (either  unregulated products or products subject to voluntary standards). In  discussions with CPSC officials, they told us that there is no field in the  databases to indicate whether a product is covered by one of the  thousands of existing voluntary standards. However, they noted that they  have internal policies for tracking compliance with voluntary standards.  According to agency officials, CPSC’s policy states that when staff has  determined that noncompliance with voluntary standards amounting to a  substantial product hazard has occurred, staff should create a file with a  case number to track this issue. The case number is an internal tracking  number that does not correspond to the unique identifier assigned by  SDOs and cannot be linked to a voluntary standard.  However, agency  officials said that if CPSC finds that the product poses a substantial  product hazard and staff determine that the voluntary standard is  inadequate or that no standard exists, they refer the case to the voluntary  standards coordinator to address through standard setting activities.
CPSC’s compliance databases for both the regulated products and  substantial hazard (section 15) products are case management systems.  According to CPSC officials, more than 50,000 distinct firm names are in  the databases. CPSC can classify incidents by manufacturer, retailer,  distributer, and country of origin. In some cases a foreign company may  have a U.S. agent or representative, making it difficult for CPSC’s  database to discern whether the reporting company is foreign or  domestic. In addition, CPSC assigns more than 800 different product and  product category codes to help track case files. CPSC’s case files track  information about the firm, the product, the type of noncompliance, and  other relevant information. The agency also tracks correspondence with  the manufacturer, distributor, retailers, and public about the case, as well  as the corrective action implemented to address the noncompliance.
Agency officials said that the databases have the capacity to track 26  hazards in 8 hazard categories, including fire hazards for fabrics,  materials, and electric appliances; mechanical hazards in children’s,  household, and sports and recreation products (involving choking,  strangulation, and other injury hazards); electrocution; and chemical  hazards. Staff use data from the compliance databases to identify types  of product defects such as those associated with design, construction,  and packaging of a product, or absence of warning labels or instructions.  They also track the number of defective products in the market and  assess the severity of risk of defects and likelihood of injury.
In addition to tracking trends from compliance data, agency staff,  including the Hazard Analysis Division, perform a range of statistical  analyses across reported incident data to identify patterns of  noncompliance. CPSC staff said they analyze compliance in terms of the  product rather than the manufacturer. Incident data comes from various  sources, including retailers; manufacturers; public safety professionals;  health care professionals; death certificates; news reports; state and local  governments; and incident reports submitted by consumers through  CPSC’s website, SaferProducts.gov. CPSC staff identify potential  emerging patterns, produce estimates of injuries and quantify the  frequency of fatalities based on emergency room data, test for injury  trends over time, and characterize hazard patterns. Analysts evaluate  these data on a daily basis and report increased frequency of reports for  a given product or manufacturer to appropriate teams in the agency.  Officials said that on a weekly basis, analysts apply algorithms across  reports to characterize the frequency by product code. They generate  statistics comparing the number of reports received in the week for  particular products to the number received for the same product over a  20-week period. CPSC officials then use the data to determine which  incidents should be investigated and report on their findings to internal  teams. For example CPSC has identified instances of appliance tipovers  and issued press releases with information to consumers to raise  awareness of tipover hazards. To address this, the agency plans to  participate in standard revision activity to address kitchen range tipovers.
In a previous report we addressed CPSC work resulting from  identification of certain hazard patterns. We reported that during the  1980s, the data CPSC collected on injuries and fatalities related to all- terrain vehicles, especially among children, led it to file a lawsuit alleging  that the vehicles were an imminently hazardous product. CPSC and  manufacturers eventually settled the lawsuit through a consent decree in  which manufacturers and distributors agreed to implement certain safety  measures and stop selling certain vehicles considered dangerous for  young children. In its fiscal year 2012 Operating Plan and Performance  Budget, CPSC also noted that it plans to update safety publications  addressing children’s hazards, fire and electrical hazards, mechanical  hazards, sports and recreational hazards, and chemical and combustion  hazards.
section_title: Conclusions
paragraphs: Voluntary standards establish safety guidelines for many of the thousands  of consumer products in CPSC’s jurisdiction. CPSC is required by law to  rely on these standards, developed through consensus by industry,  consumer, and government participants, when the standards are  adequate to address the risk of harm and substantial compliance with  them is likely. Because of the substantial prevalence of voluntary  standards for consumer products, CPSC’s early and active participation in  standards development activity is critical to establishing adequacy of the  standard. If CPSC finds that a manufacturer does not comply with a  voluntary standard and it creates a substantial product hazard, the  agency can seek a corrective action, such as a recall; however, CPSC  does not have the authority to compel compliance with voluntary  standards as such. For fiscal years 2008 through 2011, 80 percent of  recalls have been of imported products that may be subject to voluntary  standards, highlighting challenges CPSC faces in helping to ensure the  safety of consumer products. CPSC has taken steps to ensure  compliance by (1) performing industry surveillance through analysis of  incident and other data, (2) participating in standards development  activities, and (3) monitoring selected voluntary standards. Although  CPSC regularly participates in standard development activity to the extent  possible, consumer product safety experts we spoke to generally agreed  that earlier and more active CPSC participation could increase its  efficiency and effectiveness in developing standards. Our review also  found that CPSC regulations concerning meetings policies and allowable  conduct for CPSC staff participating in standards development activity are  generally more restrictive than the existing general government policy on  such participation. While OMB guidance gives agencies discretion to  determine their level of participation in standard setting activities, CPSC  has chosen to limit participation to maintain impartiality and avoid  appearance of endorsing a specific voluntary standard. Further, a recent  White House memorandum on national standards policy states that  where statute, regulation, or administration policy identifies a national  priority, the federal government may need to be actively engaged or play  a convening role to accelerate standards development and  implementation. Changing regulations to enable staff to more actively  participate, especially when working with technical committees for which  CPSC has expertise and permitting CPSC staff to vote on the standard,  could result in stronger voluntary standards without compromising  CPSC’s independence. Without more active participation from CPSC,  standards emerging from standards development organizations risk being  less stringent and may be inadequate to protect the public from hazards.
section_title: Recommendation for Executive Action
paragraphs: To strengthen the adequacy of voluntary standards, we recommend that   the Chairman of CPSC direct agency staff to review the policy for  participating in voluntary standards development activities and determine  the feasibility of assuming a more active, engaged role in developing  voluntary standards.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to CPSC for comment. In their written  comments, reproduced in appendix II, CPSC supported our  recommendation and wrote that staff would review agency policies and  determine the feasibility of changes to the policies. CPSC staff also  provided technical comments that were incorporated, as appropriate.
We are sending copies of this report to interested congressional  committees and the Chairman and commissioners of CPSC. In addition,  the report will be available at no charge on GAO’s website at  http://www.gao.gov.
If you or your staff members have any questions about this report, please  contact me at (202) 512-8678 or cackleya@gao.gov. Contact points for  our Offices of Congressional Relations and Public Affairs may be found  on the last page of this report. GAO staff who made major contributions to  this report are listed in appendix III.
section_title: Appendix I: Scope and Methodology
paragraphs: To evaluate the extent to which manufacturers comply with voluntary  standards for consumer products, we interviewed officials from the  Consumer Product Safety Commission (CPSC) and national consumer,  industry, standard-setting, and legal organizations that have expertise in  working on voluntary standards development for consumer products. We  reviewed internal CPSC operating procedures and learned about the  agency’s outreach programs to educate the public about safety  standards. We reviewed statutory authorities and procedures for  establishing voluntary standards. We interviewed the three standards  development organizations that coordinate the development of more than  90 percent of voluntary standards developed with CPSC staff technical  support to learn about how standards and certification programs are  developed.
To evaluate CPSC’s authority and ability to encourage compliance with  voluntary standards, we reviewed CPSC’s statutory and regulatory  authority related to voluntary standards. We also reviewed CPSC  standard operating procedures, performance and accountability reports,  and budget documents to obtain information about CPSC’s work plans  with respect to voluntary standards. We met with cognizant CPSC  officials, including all of CPSC’s current commissioners and the  Chairman, to discuss their authorities and ability to enforce them. We  reviewed relevant laws, regulations, and our prior reports on CPSC’s  authorities. We interviewed legal experts in the consumer product safety  field regarding CPSC’s authorities. We conducted a literature search for  information regarding CPSC’s effectiveness in getting manufacturers to  comply with voluntary standards. We attended a conference on the  adequacy of voluntary standards sponsored by the Consumer Federation  of America and a conference by the International Consumer Product  Safety and Health Organization on trends in international consumer  product safety.
To evaluate the consequences for manufacturers that fail to comply with  voluntary standards, we reviewed documents from CPSC officials and  obtained and reviewed publicly available data on recalls and other  corrective actions. We obtained and analyzed data collected by CPSC  through SaferProducts.gov regarding product safety incident reports and  corrective actions assigned to manufacturers whose products did not  comply with voluntary standards. We assessed the reliability of these data  by (1) reviewing existing information about the data and the system that  produced them and (2) interviewing agency officials knowledgeable about  the data and related management controls. We found the data to be  reliable for the purposes of determining the number and trends of product  safety incident reports and corrective actions. We interviewed CPSC  officials, legal experts, and consumer and industry participants to learn of  possible corrective actions that could be imposed on firms that fail to  comply with voluntary standards. Further, we conducted a legal literature  search for information about CPSC’s authorities to determine  consequences for manufacturers who fail to comply with voluntary  standards.
To evaluate CPSC’s efforts to identify patterns of noncompliance with  voluntary standards, we interviewed CPSC officials about their data  collection methods and internal processes for analyzing incident data and  tracking patterns. We obtained and reviewed data from CPSC’s  compliance databases to identify (1) the number of reported instances of  noncompliance; (2) the number of times these instances led to a  corrective action; (3) the numbers of corrective actions that resulted; (4)  the number of product units recalled; and (5) the type of standard, if any,  that covered the product. We assessed the reliability of these data by (1)  reviewing existing information about the data and the system that  produced them and (2) interviewing agency officials knowledgeable about  the data and related management controls. Based on this assessment,  we determined the data to be sufficiently reliable for the purposes of this  report.
We conducted this performance audit from January 2012 to May 2012 in  accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives.
section_title: Appendix II: Comments from the Consumer Product Safety Commission
section_title: Appendix III: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the individual named above, Debra Johnson, Assistant  Director; Nina E. Horowitz; DuEwa Kamara; Angela Messenger; Barbara  Roesmann; Jessica Sandler; Andrew Stavisky; and Henry Wray made  major contributions to this report.