Consumer Product Safety Commission: Agency Faces Challenges in Responding to New Product Risks
Published: 2012-12-20T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Growing numbers of consumer product recalls in 2007 and 2008, particularly of imported toys and children's products, focused increased attention on CPSC. In the 2012 Consolidated Appropriations Act, Congress directed GAO to analyze the potential safety risks associated with new and emerging consumer products. CPSC's approach focuses on new hazards, which could be risks associated with both new and existing products. Therefore, this report evaluates the authority and ability of CPSC to (1) stay generally informed about new risks associated with consumer products and use available information to identify product hazards, and (2) assess and address new risks posed by consumer products in a timely manner.
GAO reviewed CPSC's statutory and regulatory authorities to respond to product hazards; reviewed agency documents on risk assessment; reviewed CPSC corrective actions; and met with agency officials and representatives from national consumer, industry, and legal organizations with expertise in consumer product safety and risk assessment. GAO observed CPSC's testing facility and demonstrations of its information system upgrades.
section_title: What GAO Found
paragraphs: The Consumer Product Safety Commission (CPSC) has broad authority to identify, assess, and address product risks, but faces some challenges in identifying and responding to new risks in a timely manner. CPSC uses various means to stay informed about risks that may be associated with new or existing products. These methods include (1) market surveillance activities for imported products, retail stores, and Internet sales; and (2) formal agreements and various activities with other agencies. However, certain legal restrictions may hamper CPSC's ability to stay informed about new product hazards to public health and safety. Specifically, because of certain restrictions in the Consumer Product Safety Act (CPSA), CPSC cannot agree to allow foreign agencies to disclose nonpublic information they receive from CPSC. While the Consumer Product Safety Improvement Act (CPSIA) allows CPSC greater freedom to disclose information to U.S. courts, Congress, and state and local agencies, CPSC has been unable to complete information-sharing agreements with foreign counterparts as envisioned because it cannot offer its counterparts reciprocal terms on disclosure of nonpublic information. Due to the growing number of imported consumer products, this restriction on sharing information may hinder CPSC's ability to identify risks from new products in a timely manner, possibly leading to injury and death if unsafe products enter the U.S. market. CPSC also faces challenges in collecting and analyzing large quantities of data in order to identify potential product risks. Some sources CPSC uses to identify injuries or death are dated--for example, death certificates can be 2 or more years old--or contain limited information about the product involved in the incident. To respond to these challenges, the agency has key efforts under way. First, CPSC is upgrading its data management system. According to CPSC, the upgrades are designed to enhance CPSC's efficiency and effectiveness, enable a more rapid dissemination of information, and allow consumers to search the database through a publicly available Internet portal. CPSC officials expect the upgrades to be completed in fiscal year 2013 and fully operational in fiscal year 2014. Second, in response to a CPSIA requirement, CPSC is working with Customs and Border Protection to test a new approach for identifying unsafe consumer products at the ports. CPSC port investigators have found this approach to be effective and have prevented hundreds of consumer products that were in violation of U.S. safety rules or found to be hazardous from entering commerce.
Timeliness of CPSC's actions to assess and address new risks depends on the specific product or hazard. For example, the simplest assessments may only take a few days, such as testing a product for lead content. More complex assessments can take years to complete, such as tracking potential chronic hazards from certain chemicals and nanotechnology (which involves the ability to control matter at the scale of one billionth of a meter) because no standard method for measuring toxicity associated with nanotechnology currently exists. CPSC uses various approaches to address product hazards, including conducting compliance activities, developing mandatory safety standards, and educating the public about safety hazards and safe practices. CPSC can take action to address a product hazard more quickly if it is addressing a known hazard. However, addressing a new or emerging risk can take CPSC years because it may need to develop new standards or approaches.
section_title: What GAO Recommends
paragraphs: To better enable CPSC to target unsafe consumer products, Congress may wish to amend section 29(f) of CPSA to allow CPSC greater ability to enter into information-sharing agreements with its foreign counterparts that permit reciprocal terms on disclosure of nonpublic information. CPSC supported this matter.

section_title: Letter
paragraphs: Growing numbers of consumer product recalls in 2007 and 2008,  particularly of toys and other children’s products, focused increased  attention on the Consumer Product Safety Commission (CPSC). As  globalization and technological advances expand the range of products  on the market, the challenge of overseeing and regulating the thousands  of product types becomes all the more complex. Some risks include the  growth of global supply chains that assemble products across a vast web  of interconnected geographies as well as the difficulty of identifying  product hazards among hundreds of containers entering U.S. ports.  According to CPSC, the value of U.S. imports under its jurisdiction  reached about $637 billion in 2010 and about four out of five consumer  product recalls involved imported products, making imports a critical focus  of the agency. These challenges are likely to grow in the future. In  response to the growing concerns about unsafe consumer products, on  August 14, 2008, Congress enacted the Consumer Product Safety  Improvement Act (CPSIA) to reform CPSC and strengthen its authority to  enforce consumer product safety standards.
CPSC continues to face significant public scrutiny about its ability to  properly assess risks related to consumer products and take appropriate  action in a timely manner. CPSC’s risk management process includes  obtaining information about consumer products from various sources,  identifying risks, assessing those risks, and taking actions to address them.  The process focuses on risks associated with both new and existing  products. How quickly CPSC identifies, assesses, and addresses a  particular product hazard depends on several factors, including whether or  not a particular product risk is within their authority and ability to address.
In the 2012 Consolidated Appropriations Act, Congress directed us to  analyze the potential safety risks associated with new and emerging  consumer products, including chemicals and other materials used in their  manufacture, taking into account CPSC’s ability and authority to identify,  assess, and address such risks in a timely manner and keep abreast of  the effects of new and emerging consumer products on public health and  safety. This report evaluates the authority and ability of CPSC to (1) stay  generally informed about new risks associated with consumer products  and use available information to identify product hazards, and (2) assess  and address new risks posed by consumer products in a timely manner.
To address these objectives, we reviewed CPSC’s statutory and  regulatory authority related to identifying, assessing, and addressing new  risks associated with consumer products. We reviewed CPSC’s policy on  establishing priorities, procedures, strategic plan, performance and  accountability reports, budget operating plans, and incident and  compliance data, as well as relevant prior GAO reports. We reviewed  existing information about CPSC data systems and interviewed agency  officials knowledgeable about the data. Based on our review of  documentation, we believe the data are reliable for our purposes. To  assess CPSC’s authority to obtain and share information that could help  identify new hazards posed by consumer products, we reviewed our prior  work on CPSC’s authorities and legislation related to the agency. We met with CPSC officials to discuss their authorities and their ability to  identify, assess, and address risk, including all of CPSC’s current  commissioners and the Chairman. To assess certain measures of  timeliness, we reviewed CPSC’s performance goals and obtained  information on time frames for risk assessments. We toured CPSC’s  testing laboratory in Rockville, Maryland, and observed various tests  conducted as part of CPSC’s risk assessment process. Additionally, we  interviewed national consumer and industry organizations and legal  professionals that have expertise in consumer product safety. See  appendix I for additional information on our scope and methodology.
We conducted this performance audit from January 2012 through  December 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
subsections: section_title: CPSC’s Authorities and Mission
paragraphs: CPSC was created in 1972 under the Consumer Product Safety Act to  regulate certain consumer products and address those that pose an  unreasonable risk of injury; assist consumers in evaluating the  comparative safety of consumer products; and promote research and  investigation into the causes and prevention of product-related deaths,  injuries, and illnesses. CPSC’s jurisdiction is broad, covering thousands  of types of manufacturers and consumer products used in and around the  home and in sports, recreation, and schools. 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—including the National Highway Traffic Safety Administration,  Coast Guard, Department of Justice, Department of Agriculture, Food and  Drug Administration (FDA), and Environmental Protection Agency  (EPA)—have jurisdiction over these products.
CPSC has broad authorities for identifying, assessing, and addressing  risks associated with consumer products. The Consumer Product Safety  Act (CPSA) consolidated federal safety regulatory activity relating to  consumer products within CPSC. As a result, in addition to its  responsibilities for protecting against product hazards in general, CPSC  administers the following laws that authorize various performance  standards for specific consumer products:  the Flammable Fabrics Act, which among other things, authorizes  CPSC to prescribe flammability standards for clothing, upholstery, and  other fabrics;the Federal Hazardous Substances Act, which establishes the  framework for the regulation of substances that are toxic, corrosive,  combustible, or otherwise hazardous;the Poison Prevention Packaging Act of 1970, which authorizes  CPSC to prescribe special packaging requirements to protect children  from injury resulting from handling, using, or ingesting certain drugs  and other household substances; the Refrigerator Safety Act of 1956, which mandates CPSC to  prescribe safety standards for household refrigerators to ensure that  the doors can be opened easily from the inside;  the Virginia Graeme Baker Pool and Spa Safety Act of 2007, which  establishes mandatory safety standards for swimming pool and spa  drain covers, as well as a grant program to provide states with  incentives to adopt pool and spa safety standards; and the Children’s Gasoline Burn Prevention Act of 2008, which  establishes safety standards for child-resistant closures on all portable  gasoline containers.the Child Safety Protection Act of 1994, which requires the banning or  labeling of toys that pose a choking risk to small children and the  reporting of certain choking incidents to the CPSC.
In 2008 CPSIA mandated that CPSC develop an approach, not later than  August 2010, to identify products imported into the United States that are  most likely to violate consumer product safety statutes enforced by the  Commission. CPSIA specifically requires that CPSC develop this  methodology in partnership with U.S. Customs and Border Protection  (CBP) using information from shipment data from the International Trade  Data System and other databases. CPSC was required to incorporate this  approach into its information technology (IT) modernization plan, to move  to a single integrated data system intended to upgrade the data systems  that support CPSC’s regulatory activities. The act also required that  CPSC use this information to examine ways to identify possible  shipments of violative consumer products and share this information with  CBP to prevent such items from entering the marketplace. CPSC has  subsequently reported on its efforts to develop this approach for import  surveillance. These efforts are discussed in greater detail later in this  report.
While CPSC has statutory authority to regulate many types of products, it  does not have authority to require pre-approval of products before they  enter the U.S. market. Because CPSC regulates consumer products  after they enter the market, identifying new products and any new  hazards that may be associated with new products is difficult. Generally,  CPSC can require every manufacturer of an imported product subject to a  consumer product safety rule to issue a certificate that certifies based on  reasonable laboratory testing that the product complies with all rules,  bans, standards or regulations.
Under several of the acts that it administers, CPSC’s primary mission is to  protect consumers from unreasonable risk of injury or death from  consumer products under its jurisdiction. To achieve its mission, CPSC  uses various approaches captured under five strategic goals: (1) to  provide leadership in safety; (2) to reinforce a commitment to prevention;  (3) to engage in rigorous hazard identification; (4) to provide a decisive  response to identified product hazards; and (5) to raise awareness of  safety issues and CPSC capabilities.
Under the Consumer Product Safety Act, CPSC is authorized to evaluate  a consumer product to determine whether the product creates what the  act calls a “substantial product hazard” or whether the Commission  should issue a consumer product safety standard or ban by regulation to  prevent or reduce an unreasonable risk. CPSC considers the risks  associated with a consumer product and assesses whether a particular  risk is known or is a new or emerging hazard. New hazards can be  associated with either a new or existing product. For example, a new  hazard could materialize in the form of new material used to manufacture  a type of product already in existence. To address product hazards,  CPSC can issue regulations that establish performance or labeling  standards for consumer products, often referred to as mandatory  standards. CPSC refers to products subject to such mandatory standards  as regulated products. Those regulated products that do not comply with  mandatory standards are referred to as violative products. In contrast,  many consumer products that are under CPSC’s jurisdiction are subject  to voluntary standards, which are generally determined by standard- setting organizations, with input from government representatives and  industry groups, and are also referred to as consensus standards.  Unregulated products are those products not subject to any mandatory  standards and may include those covered by voluntary standards, which  do not have the force of law. However, many voluntary standards are  widely accepted by industry.Product Safety Act require CPSC to defer to a voluntary standard—rather  than issue a mandatory standard—if CPSC determines that the voluntary  standard adequately addresses the hazard and that there is likely to be  substantial compliance with the voluntary standard. As a result, voluntary  standard development is an important tool in CPSC’s hazard-reduction  efforts.  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, CPSA, as  amended by CPSIA, mandated the conversion of voluntary standards for   The 1981 amendments to the Consumer  durable infant and toddler products, all-terrain vehicles, and children’s  toys to mandatory standards.
section_title: CPSC’s Criteria for Establishing Agency Priorities
paragraphs: CPSC has established criteria for setting agency priorities and selecting  potential hazards to address.the agency regulations, include the following:   These criteria, which are incorporated into  the frequency and severity of injuries resulting from the hazard;  the cause of the hazard, which should be analyzed to help determine  the extent to which injuries can reasonably be expected to be reduced  or eliminated through CPSC action;  the number of chronic illnesses and future injuries predicted to  result from the hazard; preliminary estimates of costs and benefits to society resulting unforeseen nature of the risk, which refers to the degree to which  consumers are aware of the hazard and its consequences; vulnerability of the population at risk (such as children and the probability of consumer exposure to the product hazard; and other additional criteria to be considered at the discretion of CPSC.
CPSC’s regulations do not specify whether any particular criterion should  be given more weight than the others or that all criteria must be applied to  every potential hazard. However, CPSC officials have noted that a  product hazard that could result in death is typically granted the highest  priority.
section_title: CPSC’s Organizational Structure for Managing Risks
paragraphs: Risk management is a primary function throughout the Commission, but  certain offices have specific responsibilities for identifying, assessing, and  addressing product hazards. CPSC’s Office of Hazard Identification and  Reduction is tasked with responsibility for identifying emerging hazards  that can be addressed by agency projects, warnings, mandatory or  voluntary standards, and public awareness campaigns. This office also  provides technical support to the Office of Compliance and Field  Operations, which is responsible for capturing information about regulated  products and substantial product hazards and conducts compliance and  administrative enforcement activities under the acts that CPSC  administers. The Office of Compliance and Field Operations has  responsibility for identifying and addressing safety hazards for consumer  products already in commerce, promoting industry compliance with  existing safety rules, and conducting administrative litigation seeking  remedies that may include public notice and refund. The office receives  information about potential product hazards through industry reporting  requirements and through its own investigation of defective products.
section_title: CPSC’s Information System Modernization
paragraphs: The CPSIA required that CPSC establish and maintain a database on the  safety of consumer products and other products or substances regulated  by the Commission and that it improve its IT architecture. In response,  CPSC created a public database, which is accessible through the Internet  at SaferProducts.gov and allows consumers to directly report product-  related incidents. SaferProducts.gov was launched in March 2011 and is  integrated with CPSC’s larger, internal Consumer Product Safety Risk  Management System (CPSRMS). To address the requirement to upgrade  its IT architecture, CPSC is currently implementing improvements to  CPSRMS. CPSC officials have described this system as a centralized,  integrated data environment that upgrades its legacy systems to support  multiple efforts at the agency, such as its case management and  investigative processes. When fully integrated, CPSRMS will replace  CPSC’s historically segmented data systems with a unified information  technology system. The updated system is intended to allow CPSC to  analyze data from multiple sources in a centralized location to identify  emerging consumer product safety hazards. The purpose of this  centralization component of CPSC’s IT modernization effort is to improve  its ability to collect and analyze the hazard information it receives from  consumers and other data sources. CPSC has reported that modernizing  its IT systems will improve efficiency by connecting separate data  systems, reducing or eliminating manual and redundant processing, and  eliminating redundant and inefficient steps required to code the  information and to share the information with businesses. In addition to  this modernization effort, CPSC is developing an automated system to  improve its ability to target imported products by integrating data from  both CPSC and CBP. This system will also be integrated into CPSRMS.
section_title: CPSC Uses Several Mechanisms to Stay Informed about New Product Hazards, but Statutory Provisions Constrain Its Ability to Identify Risks
paragraphs: CPSC gathers information about new and emerging risks through several  means, such as surveiling retail markets and coordinating with other  agencies. CPSC could also potentially obtain nonpublic information on  product-related hazards from its foreign counterparts, but its legal  restrictions on public disclosure of information have hampered its ability to  establish information-sharing agreements. Further, CPSC collects data on  product-related injuries and deaths from a variety of sources, such as  consumer reports and death certificates, and as discussed above is  currently working to improve the system it uses to manage these data.  Finally, CPSC has another effort under way to improve its surveillance of  imported products, which could prevent violative products from entering  the U.S. markets.
subsections: section_title: CPSC Uses Various Means to Stay Informed about New Product Risks
paragraphs: CPSC uses multiple mechanisms to stay informed about new and  emerging risks from consumer products, especially new products entering  the market. CPSC’s market surveillance activities are one primary  mechanism staff use to track new products entering the markets,  including surveillance of imported products entering the United States,  retail stores, and the Internet:  Import surveillance, which is discussed in greater detail later in this  report, targets products before they enter the market and is CPSC’s  stated key activity to address the challenge of overseeing and  regulating the thousands of product types under its jurisdiction. Import  surveillance activities include scrutiny of import documentation and  physical screening of products at the ports.
CPSC field program surveillance includes compliance monitoring of  specified products with CPSC requirement to ensure conformance.   Surveillance and inspections are done at the manufacturer, importer,  and retail locations.
CPSC’s retail surveillance includes targeted activities to identify  potentially unsafe products, such as children’s products with unsafe  lead content and unsafe electrical products, as well as some products  subject to mandatory standards. This retail surveillance includes in- store screening of products to ensure they are appropriately labeled  and are contained in proper child-resistant packaging when required.  At times, such as for holiday sales, CPSC field staff also screen  certain products to find out if they meet generally accepted industry  voluntary standards.
CPSC compliance staff also conduct searches of the Internet, to  monitor the compliance of certain product sales. Since many firms sell  their products exclusively from Internet websites, this surveillance  functions as the primary CPSC oversight of these sellers.
Staff also attend trade shows to target possible products of interest by  observing what new products are coming to market. These visits may be  announced or unannounced.
Another mechanism CPSC has relied on for keeping informed about new  and emerging risks is its agreements with other federal and state  agencies to research various emerging issues. For example, CPSC  participates in a federal effort to leverage its limited staff resources with  larger research efforts under way on nanomaterials, as part of the  National Nanotechnology Initiative. CPSC has a joint agreement with  EPA to research the health effects of nanotechnology in consumer  products. This effort is part of a larger international research project  intended to provide a systematic, multidisciplinary approach, including  both experimental and computational tools and projects, for predicting  potential human and environmental risks associated with a range of  nanomaterials (i.e., silver and titanium dioxide).
Nanomaterials represent a wide range of compounds that may vary significantly in their  structural, physical, and chemical properties, and potentially in their behavior in the  environment and in the human body. Because of the wide variation in potential health  effects and the lack of data on exposure and toxicity of specific nanomaterials, CPSC has  been unable to make any general statements about the potential consumer exposures to  or the health effects that may result from exposure to nanomaterials during consumer use  and disposal. (NIST). CPSC signed an interagency agreement with NIST in 2011 to  develop protocols to assess the potential release of nanoparticles into the  indoor air from various consumer products and determine the potential  exposure to people. Measurement protocols do not exist yet to  characterize these particle emissions or to assess the properties of the  emitted particles that may relate to any health impacts. Under this  agreement, NIST will begin testing to assess the properties of nano-sized  particles. At the completion of this project, CPSC staff expect to complete  a status report on the measurement protocols developed for laboratory  testing for the release of nanoparticles from consumer products, as well  as for testing in actual residences. Additionally, CPSC is working with the  National Library of Medicine to identify approaches to expand and  improve a database to provide information on nanomaterials in consumer  products. One researcher emphasized that this database is quite  important to further research efforts because companies are not required  to report whether nanomaterials are used in their products.
Staff also use other channels to exchange information about consumer  products with other federal agencies, including the National Institutes of  Health (NIH), the Centers for Disease Control and Prevention (CDC), and  FDA, within the Department of Health and Human Services, the  Department of Labor-Occupational Safety and Health Administration,  EPA, and the Department of Housing and Urban Development (HUD).  CPSC staff participate in product safety committees with these agencies.  For example, staff serve on the Chemical Selection Working Group  sponsored by NIH/National Cancer Institute, as well as the Federal  Liaison Group on Asthma and the National Cancer Advisory Board. Staff  also participate in multiple working groups sponsored by the National  Institute for Environmental Health and Safety and the National Toxicology  Program. CPSC staff co-chair the Interagency Lead-based Paint Task  Force, working with EPA and HUD on human exposure to lead. CPSC  staff also serve on the Core Committee at the Center for Evaluation of  Risks to Human Reproduction under the National Toxicology Program.  Staff participate in interagency committees that develop U.S. positions for  international harmonization on test guidelines developed by the  Organisation for Economic Co-operation and Development, guidance  documents, and the globally harmonized system for the classification and  labeling of chemicals. Staff also use their professional connections,  subscribe to professional journals, and attend scientific and consumer  product safety conferences. For example, CPSC staff maintain contacts  with individual scientists at FDA on multiple issues, such as phthalates,  lead, and nanotechnology.
Furthermore, CPSC has authority to establish advisory committees to  assist in advising it on new and emerging risks. Such advisory  committees can be appointed to advise the agency on chronic hazards  that may contribute to cancer, birth defects, and gene mutations  associated with consumer products. As required by CPSIA, in 2010  CPSC appointed a Chronic Hazard Advisory Panel (CHAP) to review the  potential effects on children’s health of phthalates and phthalate  alternatives in children’s toys and child care articles.currently the only operating advisory committee to CPSC. The CHAP is to  consider the cumulative effects of exposure to multiple phthalates from all  sources, including personal care products. The CHAP was required by  CPSIA to submit a final report based on its examination by April 2012.  The CHAP examination is still ongoing and the report is expected to be  completed in fiscal year 2013. The CHAP must recommend to the  Commission whether any additional phthalates or phthalate alternatives  should be declared banned hazardous substances. Within 180 days after  this recommendation is made, CPSIA requires CPSC to promulgate a  final rule based on the report. Pending completion of the report, staff are  to provide a briefing package to the Commission for its consideration of  whether to continue the interim ban that CPSIA established (effective  Feb. 10, 2009) for certain phthalates, or whether to regulate other  phthalates or phthalate substitutes.
section_title: Statutory Restrictions Hamper CPSC’s Information-Sharing Efforts with Foreign Counterparts
paragraphs: Several of CPSC’s strategic goals emphasize working with other federal  agencies, as well as agencies of state and foreign governments. This  cooperation is important to the Commission’s effectiveness, particularly in  light of the large volume of imported products that enter the United States  each year. One key aspect of interagency cooperation is sharing  information with CPSC’s counterparts in other countries. CPSC has  memorandums of understanding (MOU) with several foreign counterparts  to share publicly available information about unsafe consumer products.  These agreements provide a formal mechanism for general exchanges of  information on consumer product safety, and in some cases include plans  for informational seminars and training programs. For example, CPSC  has taken the lead with several MOU partners on an international initiative  to work towards harmonizing global consumer product standards or  developing similar mechanisms to enhance product safety, known as the  Pilot Alignment Initiative. This initiative involves staff from the central  consumer product safety authorities of Australia, Canada, the European  Union, and the United States.positions among the participants on the hazards to children and potential  solutions for three products: corded window coverings (i.e., window  blinds), chair-top booster seats, and baby slings.
The initiative seeks to reach consensus  CPSC’s existing MOUs do not permit the exchange of nonpublic  information because of specific statutory limitations. When we reported on  CPSC’s authorities in August 2009, we concluded that CPSC had  adequate authorities to perform its mission and we made no  recommendations to change its authorities. conclusion. CPSIA amended section 29 of CPSA to allow the  Commission to make publicly available information to any federal, state,  local, or foreign government agency upon prior certification or agreement  that the information will be maintained in confidence, as defined in the  act. At that time, CPSC was working with its foreign counterparts to  implement its new authorities under CPSIA that allow it to share  nonpublic information with foreign counterparts. In the course of this  review, however, we found that when attempting to implement these  authorities, CPSC has faced certain legal constraints in sharing  information with its foreign counterparts and has not completed any new  agreements concerning the exchange of nonpublic information, as they  had expected at the time of our 2009 report.
GAO-09-803. readily identify a manufacturer, CPSC must afford the manufacturer the  opportunity to designate the information as business confidential—that is,  information a company considers and designates to be proprietary or  confidential—and barred from disclosure. The CPSA contains an  additional restriction on the public disclosure of certain regulatory  information, such as information that identifies a product manufacturer or  private labeler. Specifically, section 6(b)(1) generally prohibits CPSC from  publicly disclosing information that would readily identify the product  manufacturer unless it first takes reasonable steps to assure that the  information is accurate and that the disclosure is fair in the circumstances  and reasonably related to carrying out CPSC’s purposes under its  jurisdiction. The inclusion of section 6(b) grew out of concern about  damage that manufacturers would incur if the agency released inaccurate  information about the manufacturers’ products. Before publicly disclosing  the information, CPSC must give the manufacturer advance notice and  the opportunity to comment on the disclosure of the information, which  adds more time before CPSC can publicly respond to a potential product  hazard. If CPSC decides to disclose information that the manufacturer  claims to be inaccurate, it generally must provide 5 days advance notice  of the disclosure, and the manufacturer may bring suit to prevent the  disclosure. CPSC has issued a rule that interprets the public disclosure  restrictions of section 6(b) as covering disclosures to any person unless  specified exceptions apply.
Section 29(e) of CPSA permits CPSC to disclose accident or investigation  reports to officials of other federal, state, and local agencies engaged in  health, safety, or consumer protection activities, but only if business- confidential information is removed and the recipient agency agrees to  maintain certain confidentiality restrictions. Section 29(f) of CPSA, as  amended by CPSIA, authorizes CPSC to disclose certain information to  foreign government agencies in addition to federal, state, and local  government if the recipient agency certifies in writing in advance that the  information will be kept confidential. In addition, it provides that CPSC  generally is not required to disclose under the Freedom of Information Act  or other law confidential information it has received from a foreign agency  (although this provision does not authorize withholding of information from  Congress or a court in an action commenced by the United States or  CPSC).
Both Senate and House of Representatives committee reports on CPSIA  legislation provided the rationale and expectation underlying the  provisions enacted as section 29(f). Specifically, the Senate report noted  that goods made overseas are sold not only in the United States but also  in Europe, Africa, and other continents. Additionally, the Senate report  noted, “To the extent that the European Union bans an unsafe product  and the United States does not, shipments to Europe may well be  diverted to American shores. Once in the United States, the products may  move from state to state.” Both the Senate and House committees’  reports noted expectations that CPSC would work closely with any other  federal, state, local, or foreign governments to share information, so long  as those entities have established the ability to protect such information  from premature public disclosure. The House report further noted that  “The Committee expects that the CPSC will revisit and renegotiate, where  necessary, existing memoranda of understanding with foreign  governments and negotiate new agreements with other governments as  necessary.”
Although the addition of section 29(f) was intended to encourage  information sharing, in our discussions with CPSC staff, they expressed  concern that restrictive language in section 29(f) has hindered their ability  to share information. Specifically, CPSC explained that during the  interagency review process to address this new authority, the Department  of State (State) reviewed CPSC’s suggested language for an agreement  to implement information sharing under section 29(f). According to CPSC,  State identified that, because of certain language in section 29(f), CPSC  could not agree to allow a foreign agency to further disclose information it  had received under a confidentiality agreement, even under tightly  controlled circumstances. As a result, CPSC cannot approve text in the  information-sharing agreement that allows for further disclosures. For  example, CPSC could not permit Health Canada to disclose information it  received from CPSC under a section 29(f) agreement to a sister agency  or provincial-level safety agency. Likewise, CPSC cannot grant approval  to the European Commission to disclose such information to member  states. In contrast, the confidentiality restrictions section 29(f) imposes on  information CPSC receives from a foreign agency are less severe than  those that apply when a foreign agency receives information from  CPSC—that is, CPSC has greater freedom to disclose information than it  may grant to its foreign counterparts. CPSC is required to make available  to Congress and the courts information it receives, but its foreign  counterparts would not be allowed to make similar disclosures to their  own governing bodies or court systems. According to CPSC staff, this  lack of reciprocity has made foreign agencies unwilling to enter into  agreements with the United States to share nonpublic information. In  August 2012, CPSC staff told us that the Commission has been unable to  enter into any international agreements pursuant to section 29(f) because  CPSC’s foreign counterparts will only share information if the terms are  reciprocal. In contrast to this difficulty in completing agreements with  foreign counterparts, CPSC has on occasion been able to share  information it has gathered with U.S. state and local agencies. For  example, in dealing with hazards associated with defective Chinese  drywall, CPSC was able to share information from the investigation  involving the Chinese government with U.S. state and local agencies,  which is discussed in greater detail in appendix II.
According to CPSC staff and our further analysis of the statute, section  29(f) has not achieved the results expected by Congress when it enacted  this provision, as expressed in the previously cited committee reports.  The primary reason for this, according to CPSC staff, is that section 29(f)  does not contain a provision allowing foreign agencies to further disclose  the information CPSC provides to a foreign agency pursuant to a section  29(f) agreement—even disclosures required by the foreign agency’s laws  or to other agencies within the same nation or administrative area. This  inability to establish information-sharing agreements may hinder CPSC’s  ability to respond to a potential hazard in a timely manner because of the  delay that might occur between when a foreign counterpart decides to  take action in response to a product hazard and when that action  becomes public. This delay may allow injuries and deaths to occur from  the unsafe product’s use in the United States.
section_title: CPSC Faces Challenges in Identifying Risks Associated with New Products, but Is Taking Steps to Improve Data Systems
paragraphs: CPSC uses information from a number of sources to identify specific risks  associated with both new and existing products. However, many of these  sources have limitations, such as missing details. CPSC’s Emerging  Hazards Team and Integrated Teams review the collected data to identify  patterns of new hazards, but analyzing large quantities of information  presents challenges. To address these challenges, CPSC is currently  implementing upgrades to CPSRMS, its data management system, as  required by CPSIA.
CPSC has authority to identify and act on a wide range of consumer  product hazards. However, obtaining useful and timely information about  products involved in injuries and fatalities is an ongoing challenge for  CPSC. Additionally, according to CPSC officials, it faces challenges in  identifying risks from new and emerging products largely because  statutorily CPSC was established to respond to risks after products have  been introduced into market. To fulfill its mission of protecting the public  against unreasonable risks of injuries associated with consumer products,  CPSC collects, reviews, and analyzes information on consumer-product- related injuries and deaths from many sources, such as the National  Electronic Injury Surveillance System (NEISS), consumer incident  reports, death reports, and reports from manufacturers (see table 1).CPSC uses this information to identify a hazard or hazard pattern.
CPSC obtains most of its injury information from NEISS reports.  According to CPSC staff, this information is timely and useful in projecting  national injury estimates and monitoring historical trends in product- related injuries and is immediately accessible to CPSC staff once hospital  staff input information into the database. However, staff told us that the  information contained in the reports has limitations. As noted in CPSC’s  2011 annual report, while the reports may indicate that a consumer  product was involved in an incident, a product may not necessarily have  caused the incident. Nonetheless, the reports provide an important  source of information concerning the nature of the incidents and injuries  and the product associated with the incident. To obtain more specific  information, CPSC sometimes supplements the NEISS information by  conducting further investigations.
CPSC also identifies risks through incident reports received from  consumers and others, such as health care professionals and child  service providers, through its websites, telephone hotline, e-mail, fax, or  postal service.  According to CPSC officials, information in the incident  reports is not always complete. Furthermore, the reports may not identify  the risk associated with the incident, thus CPSC may conduct a more in- depth review of the incident.
Every incident report CPSC receives does not necessarily involve a hazardous incident.   In some instances, consumers report concern that a potential hazard might exist. year lag before the mortality data become available. CPSC supplements  information from the NEISS system, death certificates, and reports from  individual consumers with reports from medical examiners and coroners.  These reports are also limited because they do not typically contain  information that specifically identifies the product (such as brand name,  model or serial number) or manufacturer.
CPSC also receives information from manufacturers, distributors, and  retailers about products distributed in commerce that the manufacturers  conclude are potential substantial product hazards. Manufacturers of  consumer products must notify the Commission immediately if they obtain  information that reasonably supports the conclusion that a product fails to  comply with a product safety standard the Commission has relied upon;  fails to comply with any rule, regulation, standard, or ban under CPSA or  any other act enforced by the Commission; contains a defect that could  create a substantial product hazard; or creates an unreasonable risk of  serious injury or death. However, CPSC does not rely solely on  manufacturers to report a product defect in order to identify and address  hazards because CPSC sometimes obtains information on a product  defect before the manufacturer becomes aware of the problem. For  example, according to CPSC staff, retailers may provide CPSC with  reports of safety-related information and CPSC uses this retailer  information in identifying and assessing risks.
The hazard type or category classifies the general nature of the actual or potential  hazard presented by the incident, such as a chemical or mechanical hazard. data, such as submitter’s information and relationship to the victim, reports  consumers submit through the public database reduce some of the manual  tasks, such as rekeying of incident data. According to CPSC staff, for  reports received through the hotline, staff use a template to enter  information directly into the database. Other reports continue to be  manually coded by staff. According to CPSC officials, staff must review  incident reports daily to identify pertinent information to “code” the reports in  the database. This work requires staff to read the narrative and extract the  information, such as a description of the incident, location where the  incident occurred, number of victims, severity of the injury, the source of  the incident report, and a description of the product involved in the incident.
After the coding is completed, the incident reports advance to the Emerging  Hazards Team. The Emerging Hazards Team is composed of statisticians,  whose responsibilities include reviewing incident reports to identify new and  emerging product-associated hazards, performing product safety  assessments, directing new reports to appropriate Integrated Product  Teams, and sending out daily death notifications. The Emerging Hazards  Team’s review is CPSC’s first step in identifying a hazard and determining  whether the hazard is new and emerging. According to CPSC staff, the  Emerging Hazards Team reviews all incident reports daily, including those  stored in the data management system, to identify trends and patterns.  They said that this review is intended to determine whether reports should  be forwarded to one of six Integrated Product Teams, which are composed  of subject-matter experts from the Office of Hazard Identification and  Reduction, the Office of Compliance and Field Operations, and staff from  other CPSC offices and are organized by type of hazard. (We discuss the Integrated Product Teams’ role in CPSC’s assessment of risk in greater  detail later in this report.)
CPSC officials told us that in making their determination, the Emerging  Hazards Team considers the criteria set forth in 16 CFR 1009.8, such as  the frequency and severity of the injury and the vulnerability of the  population at risk. These criteria are considered at each step of the risk  process and in setting agency priorities. CPSC officials also told us that  the Emerging Hazards Team uses criteria provided to them by the  Integrated Product Teams to classify reports within the system as  needing no further review. Reports requiring no further review are stored  in the database (see fig. 1). According to CPSC officials, incidents  involving a death, particularly if it involves a vulnerable population, are  granted the highest priority and are immediately forwarded to the  appropriate Integrated Product Team for action.
In performing its review, the Emerging Hazards Team said it uses the  historical data to identify trends and patterns of potentially new and  emerging hazards while at the same time forwarding the reports to the  appropriate Integrated Product Team. Specifically, incidents that are  unusual or that appear to be similar to previously reported incidents are  analyzed more closely to determine whether they need to be assessed by  both the Emerging Hazards and Integrated Product Teams. For instance,  according to the staff, in April 2012 CPSC received a news clip that  detailed an incident involving a toy with a mirror that was attached but  protected by a plastic cover. The staff conducted a search of CPSC’s  database and identified a similar incident in August 2011. In both cases,  the child was able to remove the cover and gain access to the hazardous  component within it. Based on this finding, the team determined that the  toy was a choking hazard and the reports were forwarded to the  appropriate Integrated Product Team for a more in-depth review.
According to an agency official, identifying patterns of risk is particularly  challenging in situations involving many different makes and models of a  particular product category. For example, CPSC staff completed a  comprehensive review of crib-related infant fatalities reported to the  agency between January 2000 and May 2010 involving drop-side crib  hazards. During that period, staff was aware of 32 fatalities and hundreds  of incidents that were caused by or related to brackets that detached from  the drop-side cribs made by various manufacturers. According to the  CPSC official, because the fatalities occurred across several different  makes and models of cribs, it was difficult for CPSC to identify a pattern.  In 2007 CPSC launched its Early Warning System to look for patterns in  order to identify emerging hazards in a specific group of children’s  products—including bassinets, cribs, and play yards—quickly and  efficiently. This system relied on the integration of timely input from  technical experts and technology to rapidly identify emerging hazards and  led to millions of products being recalled. According to a CPSC news  release issued October 2008, since the creation of its Early Warning  System, the agency has conducted five crib recalls. Because of the  success of the Early Warning System in identifying hazards in these  children’s products, CPSC expanded the use of new technologies to  address hazards in other product areas through its system upgrade and  the Integrated Product Team concept.
In fiscal year 2011, staff within the Office of Hazard Identification and  Hazard Reduction implemented a new business process building upon  the existing NEISS coding system. The new process required that all  incident reports be reviewed and screened by the Emerging Hazards  Team and that all incident reports associated with certain product codes  be reviewed and analyzed by the appropriate Integrated Product Teams.  However, according to agency officials, before they can fully implement  this process, more automation of the screening process in the data- management system remains to be completed to allow the technical  experts time to focus their attention on those incidents that could indicate  a potential new hazard that needs further analysis.
To improve the processing of the voluminous data it receives, CPSC is  upgrading its data-management system—CPSRMS—as previously  discussed. According to CPSC, the upgraded system is designed to  enhance CPSC’s efficiency and effectiveness, enable a more rapid  dissemination of information, and allow consumers to search the  database through a publicly available portal. CPSC officials expect the  system upgrades to be completed in fiscal year 2013 and fully operational  in fiscal year 2014. Further, CPSC anticipates that staff will be able to  create electronic files of related incidents, investigations, assessments,  and other information to manage the high volume of incident reports the  agency receives in order to identify emerging hazards more quickly.  Finally, as part of the data system upgrade, CPSC expects to automate  the process to determine which incident reports will be assigned for  investigation.
As previously noted, CPSC’s incident reports contain information that  CPSC enters into the data system using standardized codes. However,  CPSC officials told us that in order to be more efficient in identifying  patterns and trends, the Integrated Product Teams need additional  standardized codes built into the system for identifying product hazards.  According to CPSC staff, they are in the process of developing additional  standardized codes and eventually algorithms to conduct searches using  key words, such as product manufacturer or country of origin. While the  officials said it will take 3 to 5 years to develop the standardized language  for the system, they added that the goal of this new capability is to help  the agency achieve consistency as it loses institutional knowledge due to  attrition and retirement. Ultimately, they expect the upgraded system to  expedite the process for identifying emerging hazards.
CPSC officials told us that before this upgraded database system, staff  turnover had a more dramatic impact on CPSC’s ability to identify  patterns or trends in the incident information it analyzed. In addition, the  Commission did not have the capability to monitor the incidents in such a  way that one person could see all the historical data, which interrupted  the continuity in staff analysis. Furthermore, reviewing incident reports  requires individual judgment, and automating the screening process is  expected to allow the technical experts the opportunity to focus their  efforts on specific records. As a result of the upgrade to CPSC’s  information infrastructure, manufacturers are also able to enter  information about substantial product hazards directly into CPSRMS,  allowing the information to go through the coding and screening process  more quickly. Furthermore, CPSC is in the process of developing case- management software for the Office of Compliance and Field Operations  that will integrate the various databases to provide efficiency to all staff  working on the compliance cases. The case management system is  intended to allow staff to track the progress of an investigation throughout  the agency and is scheduled to be completed in fiscal year 2013.
section_title: CPSC Is Taking Actions to Improve Its Ability to Identify Unsafe Imported Products before They Enter the Marketplace
paragraphs: As we have previously reported, CPSC has had limited ability to identify  unsafe products at the ports. In our 2009 report, we recommended that  the Chairman and commissioners of CPSC take several actions to  improve the agency’s ability to target shipments for further screening and  review at U.S. ports of entry as follows:  1.  To ensure that it has appropriate data and procedures to prevent  entry of unsafe products into the United States, we recommended that  CPSC update agreements with CBP to clarify each agency’s roles  and to resolve issues for obtaining access to advance shipment data.  2.  To improve its targeting decisions and build its risk-analysis capability,  we recommended that CPSC (a) work with CBP, as directed under  CPSIA, through the planned targeting center for health and safety  issues, to develop the capacity to analyze advance shipment data;  and (b) link data CPSC gathers from surveillance activities and from  international education and outreach activities to further target  incoming shipments.
CPSC views its import surveillance activities as a preventative strategy,  intended to stop unlawful products before they are received into the  United States. CPSC considers this strategy more proactive than relying  on traditional compliance and recall efforts to remove violative products  from the marketplace after harm may have occurred. In response to  CPSIA, CPSC has developed and is pilot testing an approach for  identifying and targeting unsafe consumer products at U.S. ports. CPSC  is designing this approach to evaluate products entering the United States  based on a predetermined set of rules (i.e., to target specific hazardous  products or importers) intended to identify imports with the highest risks to  consumers. CPSC has reported that given its low staffing levels and  limited coverage at the ports (as of November 2012, CPSC had 20 port  investigators stationed full-time at 15 of the largest U.S. ports),  developing an automated process for identifying violative products was  essential to increasing its ability to target unsafe products before they  enter commerce.
As detailed in CPSIA and based on our prior recommendation, CPSC is  designing its approach to integrate its information with import data from  CBP. CPSC has completed its agreement with CBP and obtained the  shipment data as we recommended. CPSC is in the process of moving to  a computer-based, systematic approach for targeting imports from its  prior process for screening imported products. Under its prior process,  established in 2007, CPSC staff manually screened importers’  documentation and telephoned CBP staff at the ports to detain shipments  for inspection. CPSC is designing the new targeting approach to provide  a framework that permits rules to be added and modified easily to  accommodate new risk factors and changes in operations. For example,  its approach is designed to allow CPSC staff to rank or risk-score  incoming shipments in order to prioritize the Commission’s responses to  product hazards that can be addressed at the ports.
CPSC’s initial activities are focused on import compliance, such as  screening children’s imported products for lead content. CPSC reported  that in 2011, it conducted an analysis of children’s product importers that  have had a history of noncompliance with safety standards and continues  to target these importers for safety assessment. In a CPSC staff  demonstration of this new targeting approach, we observed the use of  their rule sets and the integration of import data used to make  determinations for which shipments to target. When this import targeting  system is fully implemented, CPSC expects to be able to systematically  analyze 100 percent of shipments within CPSC jurisdiction to ensure that  adequate resources are dedicated to the highest risk shipments, as  indicated by its targeting rules. CPSC reported that it began limited  testing of its targeting concept in fall 2011.
According to its 2013 Performance Budget, in 2011, CPSC port  investigators, working with CBP agents, screened almost 10,000 import  samples at U.S. ports of entry and collected more than 1,800 import  samples for testing at the CPSC laboratory. CPSC projects that the full  implementation of this new system will take about 4 to 7 years, depending  on resources devoted to this effort. CPSC’s detailed proposal on this  import-targeting approach reported the need for additional staff for  strengthening their coverage at the ports and for additional laboratory  staff. In its report to Congress, CPSC also recommended certain legal  changes to better align the Commission’s authorities with those of CBP  and other health and safety agencies for targeting and addressing unsafe  products at import. In addition, to complete the technology piece of the  import targeting system, CPSC estimated the costs to be $40 million from  fiscal years 2013 through 2019. CPSC’s planned next step in this effort is  to reduce the duplication of effort between cases initiated by the Office of  Compliance and Field Operations and those initiated by the Office of  Import Surveillance by creating a case management system, as part of  upgrading its information system.
section_title: Timeliness of CPSC’s Actions to Assess and Address New Risks Depends on the Specific Product or Hazard
paragraphs: CPSC assesses product risks on a case-by-case basis using information  it collects from various sources. Once it has assessed the risk and  determined the need to address a product hazard, CPSC can take a  number of actions to reduce the risks of product-related injuries to  consumers.
subsections: section_title: CPSC’s Risk Assessment Varies with the Particular Product or Hazard Being Assessed
paragraphs: Once CPSC identifies product risks, it assesses those risks on a case-by- case basis. According to CPSC staff, an assessment could pertain to a  particular model of a product or to a class of products, such as drop-side  cribs, or it may be specific to a type of hazard, such as fire hazards  associated with appliances. In addition, according to CPSC officials, the  types of information CPSC collects to assess product risk depend on the  product and the type of assessment being conducted. In general, CPSC  requires information on the severity of an injury, the probability of the  hazard occurring, consumers’ ability to recognize hazardous conditions,  and how the consumer uses the product. In addition, officials stated that  manufacturer, model, serial number, number of products sold, life-cycle of  the product, and safety incidents involving the products are all useful  information. As noted earlier, most of CPSC’s information sources are  limited in the information available. Additionally, CPSC officials told us  that most information on sales of a particular product is not readily  available, and surveys to establish use and exposure information are  costly and often take up to a year to get approval (from the  commissioners and the Office of Management and Budget) to conduct.  As a result, CPSC often tries to estimate consumers’ exposure using  assumptions based on sales data and product life-cycle information.
As part of its assessment, CPSC evaluates consumer products to identify  both acute and chronic hazards. Acute hazards are conditions that create  the potential for injury or damage to consumers as a result of an accident  or short-duration exposure to a defective product. Chronic hazards are  presented by substances that can damage health over a relatively long  period, after continuous or repeated exposures. Hazards may be either  physical or chemical in nature. The adverse effects from exposure to a  chemical substance can be acute, such as poisonings, or chronic, such  as cancer or reproductive or genetic abnormalities. As stated earlier,  CPSC relies on its criteria for establishing priorities in assessing risk.  More specifically, CPSC staff can assess a product’s potential health  effects to consumers using well-established chronic hazard guidelines  based on the Federal Hazardous Substances Act.
CPSC staff with whom we spoke said CPSC relies on the knowledge and  judgment of its staff to review and analyze incident reports in order to  identify emerging hazards that the agency could address. According to  CPSC’s documentation, as part of their analysis, Integrated Product Team  staff read all the incidents within each product code assigned to them. If a  pattern emerges, they are required to review historical records and update  those records accordingly. These teams are also responsible for other risk- related activities, such as requesting investigations; recommending new  activities to management as needed, depending on the severity and  addressability of emerging hazards; and monitoring follow-up status on  compliance corrective actions and status of projects for standard  development (see fig. 2). According to CPSC staff, the agency plans to  develop standard operating procedures tailored to each team and to  establish benchmarks for the teams to use in completing their analyses of  hazards and identifying a strategy to address the hazards.
When one of the Integrated Product Teams identifies a potentially new  hazardous product, the team may request an investigation. CPSC staff,  one Commissioner, and product safety experts said that assessing the  risks posed by new products is challenging because hazards from new  products are not readily apparent because historical data are not  available for analysis. An investigation provides staff an opportunity to  obtain additional information about use of the product that could  potentially assist in their assessment. Investigation reports, which are  prepared by the Office of Compliance and Field Operations staff, provide  details about the sequence of events surrounding the incident, human  and environmental factors, and product involvement.reports generally contain the consumer’s version of what occurred based  on discussion with the incident victim or individual most knowledgeable  about the incident. CPSC staff noted that the investigative activity is an  ongoing process and the Integrated Product Teams decide whether to   The incident  continue the investigative process as they evaluate new evidence they  receive. Investigations may also include follow-up inspections at retail  stores, discussion with fire and police investigators, as well as the  inclusion of fire and police reports.
CPSC’s guidance for staff involved in risk-assessment activities identifies  certain factors based upon the Commission’s criteria for establishing  priorities. As discussed earlier, these factors include the frequency and  severity of injuries, consumers’ exposure to the risk, causality of injuries,  foreseeability of the risk, and the vulnerability of the population at risk.  CPSC’s guidance specifically states that staff should consider these  factors when deciding whether to investigate hazards or initiate corrective  actions. According to CPSC officials, staff consider these factors  throughout the risk-assessment process and in prioritizing which product  hazards require action by the Commission. As an example, a CPSC  official said that in a hypothetical situation involving an appliance that  poses a fire hazard, staff may first determine the number of incidents  involving this product, the extent of injuries, the level of exposure, and the  likelihood that exposure to this appliance will result in death or serious  injury. To evaluate the hazard, CPSC would collect samples of the  product in order to determine the source of the defect and gather market  data, such as the useful life of the product and the number of products in  the marketplace. As part of their assessment, CPSC would also consider  whether other types of products may be subject to this type of hazard,  potentially extending the time needed for the assessment.
CPSC evaluates some products, which it has identified through  investigation and market surveillance, at CPSC’s National Product  Testing and Evaluation Center. Integrated Product Teams’ evaluation  and analysis of products being tested is generally geared toward  improving standards or initiating rulemaking. The testing center is  staffed with engineers and scientists from the Office of Hazard  Identification and Hazard Reduction, some of whom are members of the  Integrated Product Teams. According to CPSC laboratory staff, many of  the samples at the testing center were imported products that CPSC  intercepted at the ports before they were distributed into commerce.  During our tour of CPSC’s test facility, we observed, for example, several  bunk beds being tested to ensure they did not pose an entrapment  hazard for children. We also observed an off-road stroller that was  submitted for testing. The staff explained that the Integrated Product  Team was testing this stroller for stability. As designed, the stroller had  three wheels and posed a tip-over hazard. As noted in table 2, according  to CPSC staff, the time needed to complete testing of regulated products  varies. These times reflect typical duration to complete the tests once a  sample is received by laboratory staff.
The Office of Compliance and Field Operations relies on the expertise of  the Emerging Hazards Team statisticians and other staff in the Office of  Hazard Identification and Hazard Reduction to perform other safety  assessments, such as database reviews and engineering file reviews. As  part of this process, the Office of Compliance and Field Operations may  request that the Emerging Hazards Team conduct a technical evaluation  of a specific type of product, such as all gas appliances that showed a  pattern of fire or explosion hazard. This assessment entails searching  CPSC’s database for all incidents involving certain types of gas  appliances with reports of gas leaks or fires using certain selection  criteria. The Office of Compliance and Field Operations may also request  that engineering staff review the full report from a manufacturer about a  product and check the company’s information against CPSC’s database.
According to CPSC officials, the timeliness of completing a risk  assessment varies. For example, the risk assessment process for a  chemical substance may be completed in a matter of days if acceptable  and valid toxicity and exposure data are readily available. CPSC is  familiar with the hazard posed by lead and has developed a testing  method that can be performed quickly.  As a result, testing toys for  compliance with lead content regulation can be completed within 1 to 4  days, depending on whether the product can be tested using X-ray  fluorescent equipment or requires traditional chemical analysis. In  contrast, the risk assessment process of some chemical substances may  take years to complete if CPSC needs to generate toxicity and exposure  data through laboratory experiments. For example, in assessing the risk  to children from playing on wood playground equipment treated with  chromated copper arsenate (CCA), CPSC staff reviewed toxicity data and  determined that there were insufficient data available on the exposure to  arsenic from CCA-treated wood on which to base a recommendation to  the Commission on the risk to children. As a result, CPSC staff designed  and performed new laboratory and field studies to obtain exposure data to  assess the health risk to children. CPSC began this project in 2001 and  presented the results of its study to the Commission in 2003. CPSC’s  timeline for conducting other safety assessments varied from 4 hours to  perform a consultation by a technical engineer on a hazard classified as a  high priority (where the risk of death or grievous injury or illness is likely or  very likely or serious risk of illness is very likely) to 8 weeks to test a  product sample for a routine case identified as a hazard that is possible  but not likely to occur.
Furthermore, CPSC faces challenges assessing the risks associated with  products manufactured using nanomaterials. In particular, the introduction  of consumer products containing nanomaterials into the marketplace may  require unique approaches to determine exposure and risk and poses  new regulatory challenges for CPSC. According to CPSC’s statement on  nanomaterial, the potential safety and health risks of nanomaterials, as  well as other compounds that are incorporated into consumer products,  can be assessed under existing CPSC statutes, regulations, and  guidelines. However, because testing methods are still being developed,  conducting its risk assessment of such products will take longer. Neither  CPSA nor the Federal Hazardous Substances Act requires the premarket  registration or approval of consumer products. Thus, CPSC would usually  not evaluate the product’s potential risk to the public until a product  containing nanomaterials has been distributed into commerce.
section_title: CPSC Uses Various Approaches to Address Product Hazards, but Faces Challenges in Addressing New Product Risks
paragraphs: To address product-related hazards, CPSC uses various approaches  designed to reduce injuries and deaths. CPSC’s enforcement role is  based on its statutory authority to address unreasonable risks associated  with consumer products. Based on CPSC’s documents, CPSC staff use  investigations and assessments of product hazards to determine (1)  whether corrective action is appropriate and (2) what type of actions may  be appropriate to address potential risks of injury to the public. Before  deciding to take action, CPSC must consider whether the risk is one that  the Commission can address. For example, the blade of a kitchen knife  can harm a consumer, but the sharpness of the knife, by design, is not a  defect and the risk it poses cannot be addressed by CPSC’s actions.  However, according to CPSC staff, if the handle of the knife breaks while  the knife is in use and injures the consumer, CPSC would consider the  product to be defective and the risk to be addressable.
CPSC’s actions to address and reduce the risks of injury to consumers  include the following.
Compliance—conducting compliance activities, such as voluntary  recalls and corrective actions, product bans, and enforcement of  existing regulations by seeking civil and criminal penalties, and  injunctive relief against prohibited acts.
Standards—developing mandatory safety standards or participating in  the voluntary standards process.
Public Education—notifying the public of safety hazards and  educating them about safe practices.
According to CPSC, its multifaceted approach is intended to not only  address immediate problems but also future problems. For instance,  CPSC identified fire pots used with gel fuel as an emerging hazard in  June 2011, after a severe injury was reported (see fig. 3). As of  September 2011, CPSC was aware of 76 incidents involving fire pots  used with gel fuel that resulted in two deaths and 86 injuries. CPSC  reported that preliminary testing and evaluation of fire pots and gel fuels  showed that they pose a serious risk of burn injuries to consumers due to  certain features of the fire pot design, the burning and physical  characteristics of the gel fuel, and the packaging of the gel fuel container.  In the short term, CPSC worked with the individual manufacturers to  recall the product. To address longer term concerns with the product, the  agency is also working to develop mandatory standards to address risks  associated with similar and future products. Between June and October  2011, CPSC announced 12 voluntary recalls involving more than 2 million  bottles of gel fuel. In December 2011, the Commission issued an  Advance Notice of Proposed Rulemaking (ANPR) to address the injuries  and deaths associated with this product. As we previously reported,  according to CPSC, the time required for mandatory rulemaking varies  depending on the complexity of the product or legal requirements for  enacting the rules, 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 1994.
GAO-12-582. Interested parties generally have 60 days to comment on an ANPR and  Gel fuel for fireplaces has been available in single-use cans since the mid-1980s.  An incident may include more than one death or injury. According to CPSC briefing to  commissioners, the earliest incident known to staff occurred on April 3, 2010. In some cases, the  incident is reported to CPSC days after it occurred, and in other cases, it has taken more than a year.  Several incidents that occurred in 2010 were reported to CPSC in 2011.  The purpose of the ANPR was to determine what voluntary or mandatory standards should be  implemented, what, if any, changes should be made to labeling, and if the products should be banned  or no regulatory action taken.  According to CPSC, in fiscal year 2013 staff plan to review comments to the ANPR and develop  performance criteria and test methods for a potential mandatory rule. In fiscal year 2014, CPSC plans  to prepare a Notice of Proposed Rulemaking package for the Commission’s consideration.
subsections: section_title: Reliance on Voluntary Standards
paragraphs: CPSC’s statutory authority requires the Commission to rely on voluntary  standards to build safety into consumer products if the Commission  determines that compliance with a voluntary standard is likely to result in  the elimination or adequate reduction of risk of injury identified and that  there will be substantial compliance with the voluntary standard. CPSC  officials told us that compliance with applicable voluntary standards would  be one of many factors in the decision on whether an unregulated product  is defective and poses a risk of injury, thus requiring corrective action. In  addition to taking steps to ensure compliance, the agency may address  the risk presented by unregulated products—that is, products not subject  to mandatory standards—by recommending revisions to voluntary  standards. However, having a voluntary standard that does not address  the particular defect or hazard that is being examined can slow down the  process of getting a corrective action. In some instances, the  manufacturer may disagree with CPSC’s finding that a product can meet  a voluntary standard but has a defect that creates a serious risk of injury  or death. If the strategy to address a risk is to develop a voluntary  standard, the Office of Hazard Identification and Reduction will work to  develop the standard.
If CPSC finds that a manufacturer’s product fails to comply with voluntary  standards or presents a substantial product hazard, it can take an  enforcement action, such as seeking a public notice or recall. When a  recall is deemed necessary, the Office of Compliance and Field  Operations negotiates with the responsible firm to seek a “voluntary” or a  negotiated recall whenever possible. According to CPSC officials, if the  firm does not cooperate, CPSC can seek to (1) issue a unilateral press  release asking consumers to discontinue use of the product, (2) ask  distributors and retailers to stop selling the unsafe products, (3) obtain  injunctive relief, (4) file an administrative complaint before an  administrative law judge to affirm its position, although this process can  take several months or years to complete, or (5) pursue an action against  the product and manufacturer under the imminent hazard provision of  CPSA. CPSC staff told us that for each recall, the Office of Compliance  and Field Operations works with the Office of Hazard Identification on a  case-by-case basis to determine whether standards (voluntary or  mandatory) need to be developed to address similar or future products.
In addition, CPSC can assess civil penalties if a manufacturer, distributor,  or retailer knowingly fails to report potential substantial product hazards.
CPSC has established the Fast-Track recall program, which provides  firms the opportunity to streamline the recall process by removing  hazardous products from the marketplace immediately. Under section  15(b) of CPSA, if a company suspects that a product could be hazardous,  the company must report it to CPSC. The Fast-Track recall program  allows the company to propose a plan for an expedited recall. If CPSC  considers the firm’s plan satisfactory—and finds no other cause for  concern in its review—it approves the plan and works with the firm to  expedite the recall to begin within 20 days of the initial report to CPSC.  This program is intended to remove dangerous products from the  marketplace faster and save the company and CPSC both time and  money. While some industry representatives have questioned the  timeliness of the Fast-Track program, CPSC stated that a number of  factors could slow the process, such as delays in receiving information  from the firm, delays in completing product safety assessments, or  evaluation of the remedy being suggested. CPSC reported that in 2011  staff completed technical reviews of hazardous products and initiated  corrective actions within 20 days 95 percent of the time, thereby  exceeding the Commission’s goals for initiating Fast-Track recalls by 5  percent. Since August 1997, CPSC reported that it has used the Fast- Track recall program to conduct 2,000 recalls on over approximately 200  million products.
The timeliness of CPSC’s response to new and emerging hazards  depends, in part, on the extent to which U.S. companies are motivated to  quickly institute and enforce stringent product safety standards because  selling products that cause injury or death can have negative impacts on  their brands. In addition, the tort system in the United States—by  exposing companies selling unsafe products to lawsuits—helps ensure  that companies are motivated to comply with product safety standards.  CPSC faces a trade-off between consumer protection and industry  cooperation when deciding what actions to take, such as developing  standards or banning a particular product, and whether industry self- regulation can be used to protect consumers. Balancing the interests of  both consumers and industry participants adds complexity and affects the  timeliness of CPSC’s response. If CPSC does not act quickly enough, a  consumer may be harmed by using an unsafe product. However, if CPSC  acts too quickly, it can be subject to lawsuits from companies that claim it  has not presented sufficient evidence to prove a product hazard, which  could result in a reversal of its decision and any action taken against a  company.
Although CPSC has broad regulatory powers, the agency’s efforts to  address product hazards are also carried out using other methods, such  as through consumer and manufacturer outreach. For example, CPSC  can provide information to consumers on safety practices that can help  prevent product-related accidents. These outreach efforts are carried out  by the Office of Education, Global Outreach, and Small Business  Ombudsman. This office’s primary responsibility is to coordinate and  provide education and outreach activities to various domestic and  international stakeholders. The office is also responsible for working with  manufacturers to help build safety into their products to prevent  dangerous products from ever entering the marketplace.
CPSC uses a range of communication strategies to inform the public  about safety issues. This information is intended to help consumers make  informed choices about the products they purchase and to educate  consumers on how to use the products safely and to act quickly if they  own a recalled product. According to CPSC, the Commission has had  success in educating the public through increased use of social media to  communicate safety messages and through targeted campaigns that aim  to reach the most vulnerable populations affected by certain product  hazards. Examples include the “Safe Sleep” and “Pool Safely”  campaigns, which addressed risks associated with baby cribs, baby  monitor cords and sleep positioners, and swimming pools and spas,  respectively. CPSC posts recalls and press releases to its website in a  format that allows television stations and other media to obtain  information from CPSC’s website to post on their own websites.  Consumers also have the option of accessing www.SaferProducts.gov or  calling the CPSC hotline to ask questions about recalls or request safety  information.
CPSC finds it challenging to address hazards posed by new products  because first, the product defect or hazard must be identified; second, the  associated risk must be assessed; and as noted earlier, it is harder to  identify and assess the risk associated with new products when there is  no historical data to assess. Furthermore, according to one agency  official, because CPSC does not have authority to require pre-approval of  products before they enter the U.S. market, CPSC cannot take action  unless a product creates a risk of harm. Generally, new products are  unregulated—that is, they are not subject to existing mandatory  standards. To illustrate the challenge CPSC faces with addressing risks  associated with new products, an agency official cited an instance where  the agency collected a handful of incident reports involving a new infant  sleep product. They performed a hazard profile on the product but  because there had been no injury associated with the product, CPSC  could not make a good case to have the manufacturer remedy an  identified potential problem. In instances where CPSC may identify a  potential hazard before a product is introduced into commerce, the  agency’s only action is to alert the manufacturer of the potential hazard or  product defect.
Moreover, CPSC may not have prior experience with the potential hazard  from a new consumer product and may need to take a number of actions  to address a specific hazard, which can take years. For example, CPSC  has recognized for several years that the ingestion of small magnets can  pose a hazard for children. After 34 incidents were reported, 1 resulting in  the death of a 20-month old child, and after investigating these incidents,  CPSC issued a recall of children’s toys with magnets in March 2006. After  further incidents of magnet ingestion were reported, CPSC issued an  expanded recall in April 2007. From 2007 to 2008, CPSC worked with the  toy industry and other stakeholders to develop a voluntary standard,  which the Commission made mandatory in August 2009. However, high- powered magnet sets became available during 2008, with sales  increasing in 2009. In February 2010, CPSC received its first report of an  ingestion of high-powered magnets by a child. Although there was no  injury associated with this magnet ingestion, CPSC noted that the product  was inappropriately labeled for children and did not comply with the  mandatory toy standards. In response, in May 2010, CPSC worked with  one manufacturer to issue a voluntary recall due to the improper labeling.  In December 2010, CPSC received another report of high-powered  magnet ingestion by a child that required surgery. Because the  circumstances differed from those of previous incidents, CPSC continued  to track these incidents and conducted a follow-up investigation. In  November 2011, CPSC and two manufacturers issued a public service  announcement related to ingestion of magnets. CPSC continued to  receive reports of incidents involving the ingestion of high-powered  magnets. In 2012, the majority of manufacturers agreed to stop selling the  product, but two manufacturers, one of which sold more than 70 percent  of the magnet sets purchased in the United States, did not. To address  the hazard associated with the products remaining in the market, CPSC  filed administrative actions against the companies in July and August  2012. On September 4, 2012, CPSC took further action and issued a  notice of proposed rulemaking to prohibit high-powered magnet sets. The  public comment period ended on November 19, 2012. See figure 4 for a  timeline of CPSC’s actions in response to hazards associated with  magnets.
section_title: Conclusion
paragraphs: CPSC has broad authority for identifying, assessing, and addressing risks  from unsafe consumer products. However, it faces challenges in  identifying risks from new and emerging products largely because  statutorily CPSC was established to respond to risks after products have  been introduced into the U.S. market. Neither CPSA nor any other acts  administered by CPSC require a premarket registration or approval of  consumer products. Thus, CPSC does not evaluate a product’s potential  risk to the public until a product is introduced into commerce. CPSC also  faces challenges in identifying product risks in a timely manner because  of the large quantity of information it must gather and manage. CPSC has  taken steps to improve its responsiveness through better technology for  identifying risks, more targeted surveillance of imported products, and a  program for manufacturers to streamline the process for conducting  recalls. CPSC’s efforts to improve its ability to identify unsafe products  and target unsafe imported products through IT improvements are still  under way, and the agency projects that they will be completed in 3 to 7  years.
Because CPSC faces challenges in identifying and targeting unsafe  products at import, it has attempted to update information-sharing  agreements with its foreign counterparts, as Congress expected when it  amended CPSA by including section 29(f). However, restrictive language  in CPSA, as amended by CPSIA, has hindered CPSC’s ability to share  certain information with its counterparts internationally. Therefore, the  Commission has been unable to enter into any international agreements  pursuant to section 29(f) because CPSC’s foreign counterparts will only  share information under reciprocal terms that permit those foreign  counterparts to make nonpublic information available to their own  governing bodies or court systems. Based on our analysis of the statute,  section 29(f) has not achieved the results expected by Congress when it  enacted this provision and CPSC may benefit from having more flexibility  to exchange information with its counterparts in other countries, which  would help CPSC prevent unsafe products from entering the U.S.  marketplace.
section_title: Matter for Congressional Consideration
paragraphs: To better enable CPSC to target unsafe consumer products, Congress  may wish to amend section 29(f) of CPSA to allow CPSC greater ability to  enter into information-sharing agreements with its foreign counterparts  that permit reciprocal terms on disclosure of nonpublic information.
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 III, CPSC supported our matter for  congressional consideration and believed that it would benefit from  having more flexibility to exchange information with its counterparts from  other countries through agreements that permit reciprocal terms on  disclosure of information. CPSC staff also provided technical comments  that we incorporated, as appropriate.
We are sending copies of this report to appropriate congressional  committees and the Chairman and commissioners of CPSC. The report  also is available at no charge on the GAO website at http://www.gao.gov.
If you or your staff 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 IV.
section_title: Appendix I: Objectives, Scope, and Methodology
paragraphs: The Consolidated Appropriations Act requires GAO to analyze the  potential safety risks associated with new and emerging consumer  products, including chemicals and other materials used in their  manufacture, taking into account the Consumer Product Safety  Commission’s (CPSC) ability and authority to identify, assess, and  address the risks of new and emerging consumer products in a timely  manner and to keep abreast of the effects of these products on public  health and safety. Our objectives were to evaluate the authority and  ability of CPSC to (1) stay generally informed about new risks associated  with consumer products and use available information to identify product  hazards, and (2) assess and address new risks posed by consumer  products in a timely manner.
To address these objectives, we reviewed the statutes and regulations  that provide the basis for CPSC’s authorities related to protecting  consumers from unreasonable risk of injury. We also examined guidance  developed by CPSC that informs their approach to identifying, assessing,  and addressing new and emerging risks, such as CPSC’s policy on  establishing priorities for action by the Commission, guidance on risk- related activities, and information-quality guidelines. In addition, we  reviewed CPSC’s operating procedural manuals for coding incident  reports into its data-management system and for assigning hazard codes  to these reports, performance and accountability reports, strategic plans,  budget operating plans, 2013 performance budget request, and annual  reports. We reviewed existing information about CPSC data systems and  interviewed agency officials knowledgeable about the data. Based on our  review of documentation, we believe the data are reliable for our  purposes. We also reviewed prior GAO reports on CPSC, risk  assessment in the federal government, and nanotechnology, and  consulted GAO’s Standards for Internal Control in the Federal  Government and Internal Control Management and Evaluation Tool to  assess CPSC’s policies and procedures. We also examined the chronic  hazard guidelines based on the Federal Hazardous Substance Act that  CPSC uses to assess a product’s potential health effects. In addition, we  reviewed data on CPSC corrective actions. To assess CPSC’s timeliness  in identifying, assessing, and addressing new and emerging risks, we  examined the Office of Management and Budget’s (OMB) Memorandum  on Principles for Risk Analysis, OMB’s 2006 Proposed Risk Assessment  Bulletin, and the National Research Council’s Review of OMB’s Proposed  Risk Assessment Bulletin. We also reviewed CPSC’s performance goals  and obtained data on its time frames for performing product safety  assessments and testing at the National Product Testing and Evaluation  Center.
To assess CPSC’s authority to obtain and share information that could  help identify new hazards posed by consumer products, we reviewed our  prior work on CPSC’s authorities and legislation related to the agency.addition, we reviewed CPSC’s list of its collaborative efforts with other  federal agencies to remain informed of new and emerging risks. We  reviewed memorandums of understanding between CPSC and some of  its foreign counterparts as well as information on risk management  practices developed by other countries such as the European Union.
In addition to our document review, we interviewed CPSC officials and  staff as well as all of CPSC’s current commissioners and the Chairman to  understand the organizational structure and the roles and responsibilities  of the offices involved in safety operations and data collection, as well as  to gain their perspectives on CPSC’s ability and authority to identify,  assess, and address new and emerging risks in a timely manner. We also  interviewed national consumer and industry organizations and legal  professionals and toured CPSC’s National Product Testing and  Evaluation Center. At the center, we watched staff conduct flammability  testing of a product and learned of other types of testing CPSC conducts  such as chemical, combustion, and durability testing. We also observed,  through CPSC staff’s illustration, the data-management system CPSC  uses to code and screen incident data in order to identify and assess  risks. Finally, through a demonstration of CPSC’s import targeting  system, we viewed the type of information CPSC is using in piloting its  target system to identify unsafe products at the ports.
We conducted this performance audit from January 2012 to December  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: CPSC’s and Other Agencies’ Coordinated Responses to Hazards Posed by Defective Chinese Drywall
paragraphs: When an emerging risk related to drywall (i.e., sheetrock used in  construction) was identified in 2008 that crossed the jurisdiction of several  federal agencies, CPSC took the lead in coordinating what the agency  reported as the largest investigation in its history. CPSC participated in an  intergovernmental task force with the Department of Housing and Urban  Development (HUD), Environmental Protection Agency (EPA), Centers  for Disease Control and Prevention (CDC), and Department of Homeland  Security. In 2008, CPSC was informed of a high level of hydrogen sulfide  emissions in drywall made in China that was imported into the United  States from 2001 through 2008. The bulk of the almost 4,000 complaints  involved homes built in 2006 through 2007. A high level of hydrogen  sulfide emissions is associated with metal corrosion, which can damage  household appliances and electrical systems. CPSC performed testing  and found the level of hydrogen sulfide emissions in Chinese drywall to  be 100 times that of non-Chinese drywall. Some of the Chinese  manufacturers were aware of the issue in 2006 but did not share the  information with CPSC, as required. CPSC coordinated with EPA to  conduct an elemental analysis on the components contained in Chinese  and non-Chinese drywall, as well as develop a protocol for conducting air- quality testing. CDC’s role was to assess health effects and develop a  public awareness campaign. HUD’s role was to develop guidance for the  identification and remediation of problem drywall in homes and provide  grants to help in these efforts. Customs and Border Protection (CBP)  worked to identify any imports of Chinese drywall. CPSC also worked  closely with the Federal Council on Environmental Quality and the  Domestic Policy Council. In addition, the Commission worked with state  partners including state attorneys general and health departments. The  timeline in figure 5 illustrates how CPSC addressed the emerging risk.
section_title: Appendix III: Comments from the U.S. Consumer Product Safety Commission
section_title: Appendix IV: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, Debra Johnson (Assistant  Director), Tim Bober, Christine Broderick, Marcia Crosse, Philip Curtin,  DuEwa Kamara, Yola Lewis, Alexandra Martin-Arseneau, Marc Molino,  Nadine Garrick Raidbard, Jessica Sandler, Jennifer Schwartz, Sushil  Sharma, Andrew Stavisky, and Henry Wray made key contributions to  this report.