Chemical Regulation: Options for Enhancing the Effectiveness of the Toxic Substances Control Act
Published: 2009-02-26T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Congress passed the Toxic Substances Control Act (TSCA) in 1976, authorizing the Environmental Protection Agency (EPA) to obtain information on the risks of industrial chemicals and to control those that EPA determines pose an unreasonable risk. However, EPA does not have sufficient chemical assessment information to determine whether it should establish controls to limit public exposure to many chemicals that may pose substantial health risks. In reports on TSCA, GAO has recommended statutory changes to, among other things, provide EPA with additional authorities to obtain health and safety information from the chemical industry and to shift more of the burden to chemical companies for demonstrating the safety of their chemicals. The most important recommendations aimed at providing EPA with the information needed to support its assessments of industrial chemicals have not been implemented--a key factor leading GAO in January 2009 to add transforming EPA's process for assessing and controlling toxic chemicals to its list of high-risk areas warranting attention by Congress and the executive branch. This testimony, which is based on prior GAO work, addresses EPA's implementation of TSCA and options for (1) obtaining information on the risks posed by chemicals to human health and the environment, (2) controlling these risks, and (3) publicly disclosing information provided by chemical companies under TSCA.
section_title: What GAO Found
paragraphs: TSCA generally places the burden of obtaining data on existing chemicals on EPA, rather than on the companies that produce the chemicals. For example, the act requires EPA to demonstrate certain health or environmental risks before it can require companies to further test their chemicals. As a result, EPA does not routinely assess the risks of the roughly 80,000 industrial chemicals in use. Moreover, TSCA does not require chemical companies to test the approximately 700 new chemicals introduced into commerce annually for their toxicity, and companies generally do not voluntarily perform such testing. Further, the procedures EPA must follow in obtaining test data from companies can take years to complete. In contrast, the European Union's chemical control legislation generally places the burden on companies to provide health effects data on the chemicals they produce. Giving EPA more authority to obtain data from the companies producing chemicals, as GAO has in the past recommended that Congress consider, remains a viable option for improving the effectiveness of TSCA. While TSCA authorizes EPA to issue regulations that may, among other things, ban existing toxic chemicals or place limits on their production or use, the statutory requirements EPA must meet present a legal threshold that has proven difficult for EPA and discourages the agency from using these authorities. For example, EPA must demonstrate "unreasonable risk," which EPA believes requires it to conduct extensive cost-benefit analyses to ban or limit chemical production. Since 1976, EPA has issued regulations to control only five existing chemicals determined to present an unreasonable risk. Further, its 1989 regulation phasing out most uses of asbestos was vacated by a federal appeals court in 1991 because it was not based on "substantial evidence." In contrast, the European Union and a number of other countries have largely banned asbestos, a known human carcinogen that can cause lung cancer and other diseases. GAO has previously recommended that Congress amend TSCA to reduce the evidentiary burden EPA must meet to control toxic substances and continues to believe such change warrants consideration. EPA has a limited ability to provide the public with information on chemical production and risk because of TSCA's prohibitions on the disclosure of confidential business information. About 95 percent of the notices companies have provided to EPA on new chemicals contain some information claimed as confidential. Evaluating the appropriateness of confidentiality claims is time- and resource-intensive, and EPA does not challenge most claims. State environmental agencies and others have said that information claimed as confidential would help them in such activities as developing contingency plans to alert emergency response personnel to the presence of highly toxic substances at manufacturing facilities. The European Union's chemical control legislation generally provides greater public access to the chemical information it receives, and GAO has previously recommended that Congress consider providing EPA additional authorities to make more chemical information publicly available.

section_title: Letter
paragraphs: I am pleased to appear today before the Subcommittee on Commerce,  Trade, and Consumer Protection, House Committee on Energy and  Commerce, to discuss our work on the need to improve the Toxic  Substances Control Act (TSCA). As you know, tens of thousands of  chemicals are currently in commercial use in the United States and  hundreds of new chemicals are introduced into commerce each year— some of which may be toxic and adversely affect human health or the  environment. The Congress passed TSCA in 1976 to enable the  Environmental Protection Agency (EPA) to obtain information on the  risks of commercially used chemicals and to control those that EPA  determines may pose unreasonable risks. However, TSCA generally places  the burden of obtaining information about the roughly 80,000 chemicals  already on the U.S. market on EPA, rather than on the companies that  produce the chemicals. The act requires EPA to demonstrate certain  health or environmental risks before it can require companies to further  test their chemicals. As a result, EPA does not routinely assess the risks of  the industrial chemicals that are already in use. Further, for the  approximately 700 new chemicals introduced into commerce annually,  chemical companies are required to provide EPA with certain information  in “premanufacture notices,” and EPA can ban or limit a chemical’s use if  it finds, among other things, that this information is insufficient to allow  evaluation of the chemical’s health and environmental effects. Although 85  percent of the notices lack any health or safety test data, EPA does not  often use its authority to obtain more information.
In previous reports on TSCA, we have recommended both statutory and  regulatory changes to, among other things, strengthen EPA’s authority to  obtain additional information from the chemical industry, shift more of the  burden to chemical companies for demonstrating the safety of their  chemicals, and enhance the public’s understanding of the risks of  chemicals to which they may be exposed. In part because the most  important recommendations aimed at providing EPA with the information  needed to support its assessments of industrial chemicals have not been  implemented, in January 2009, we added transforming EPA’s processes for  assessing and controlling toxic chemicals to our list of areas at “high-risk”  for waste, fraud, abuse and mismanagement or in need of broad-based  transformation.
My testimony today is largely based on our prior work involving TSCA that  identified the challenges associated with implementing the act and some  of the legislative options available to address these challenges.  Specifically, my statement addresses EPA’s implementation of TSCA and  options for (1) obtaining information on the risks posed by chemicals to  human health and the environment, (2) controlling these risks, and (3)  publicly disclosing information provided by chemical companies under  TSCA. In addition, my testimony will also highlight the results of our 2007  report assessing the key differences between the approach to chemical  regulation under TSCA and the chemical control policy the European  Union adopted in 2006 under legislation known as Registration, Evaluation  and Authorization of Chemicals (REACH). (See Related GAO Products  following this statement.)
In summary, EPA lacks adequate scientific information on the toxicity of  many chemicals in the environment. TSCA generally places the burden of  obtaining data on chemicals on EPA, rather than on the companies that  produce the chemicals. This approach requires that EPA demonstrate  certain health or environmental risks before it can require companies to  further test their chemicals. As a result, EPA has only limited information  on the health and environmental risks posed by these chemicals. In  previous reports on TSCA, we have identified for Congressional  consideration statutory changes to strengthen EPA’s authority to obtain  information from the chemical industry. In our view, these changes remain  viable options for improving the effectiveness of TSCA and thereby  enhancing EPA’s ability to protect public health and the environment.
While TSCA authorizes EPA to issue regulations that may, among other  things, ban existing toxic chemicals or place limits on their production or  use, the statutory requirements EPA must meet to do so present a legal  threshold that has proven difficult for EPA and discouraged agency action.  For example, EPA has long concluded that asbestos is a known human  carcinogen that can cause lung cancer and other diseases. Although EPA  spent 10 years developing a rule to phase out the use of nearly all products  containing asbestos under its TSCA authority, a federal appeals court  largely vacated the rule because it was not based on “substantial  evidence.” In contrast to the United States, the European Union and a  number of other countries have essentially banned asbestos and asbestos- containing products. Since EPA’s asbestos rule was rejected in 1991, the  agency has not completed any actions to ban or limit toxic chemicals  under section 6. The options for enhancing the effectiveness of TSCA that  we have identified in prior reports include amendments to reduce the  evidentiary burden that EPA must meet to enable EPA to better protect  the public health and the environment.
EPA’s ability to provide the public with information on chemical  production and risk has been hindered by strict confidential business  information provisions of TSCA, which generally prohibits the disclosure  of confidential business information. State environmental agencies and  others have expressed interest in obtaining information claimed as  confidential business information for use in various activities, such as  developing contingency plans to alert emergency response personnel to  the presence of highly toxic substances at manufacturing facilities. In  previous reports, we have identified options for statutory changes to  improve EPA’s ability to make more chemical information publicly  available.
subsections: section_title: Background
paragraphs: The Toxic Substances Control Act was enacted in 1976 to provide EPA  with the authority, upon making certain determinations, to collect  information about the hazards posed by chemical substances and to take  action to control unreasonable risks by either preventing dangerous  chemicals from making their way into use or placing restrictions on those  already in commerce. TSCA authorizes EPA to review chemicals already in  commerce (existing chemicals) and chemicals yet to enter commerce  (new chemicals). EPA lists chemicals in commerce in the TSCA inventory.  Of the over 83,000 chemicals currently in the TSCA inventory, about 62,000  were already in commerce when EPA began reviewing chemicals in 1979.  Since then, over 21,000 new chemicals were added to the inventory and  are now in use as existing chemicals. To assess risks, EPA examines a  chemical’s toxicity or potential adverse effects and the amount of human  and environmental exposures. TSCA generally requires the industry to  notify EPA at least 90 days before producing or importing a new chemical.  These notices contain information, such as the chemical’s molecular  structure and intended uses that EPA uses to evaluate the chemical’s  potential risks. TSCA also authorizes EPA to promulgate rules to require  manufacturers to perform tests on chemicals in certain circumstances or  provide other data, such as production volumes, on existing chemicals. In  addition, TSCA requires chemical companies to report to EPA any data  that reasonably support a conclusion that a chemical presents a  substantial risk. If EPA finds that a chemical’s risks are unreasonable, it  can prohibit or limit its production, processing, distribution, use, and  disposal or take other action, such as requiring warning labels on the  substance. While TSCA authorizes EPA to release chemical information  obtained by the agency under the act, TSCA provides that certain  information, such as data disclosing chemical processes, can be claimed as  confidential business information by chemical manufacturers and  processors. EPA generally must protect such information against public  disclosure unless such disclosure is necessary to protect against an  unreasonable risk of injury to health or the environment.
Like the United States, the European Union has laws and regulations  governing the manufacturing and use of chemicals. However, the EU has  recently revised its chemical control policy through legislation known as  Registration, Evaluation and Authorization of Chemicals (REACH).  REACH went into effect in June 2007, but full implementation of all the  provisions of REACH will be phased in over an 11-year period. Under  REACH, authority exists to establish restrictions for any chemical that  poses unacceptable risks and to require authorization for the use of  chemicals identified as being of very high concern. These restrictions  could include banning uses in certain products, banning uses by  consumers, or even completely banning the chemical. Authorization will  be granted if a manufacturer can demonstrate that the risks from a use of  the chemical can be adequately controlled or that the socioeconomic  benefits outweigh the risks and that there are no suitable alternatives. In  addition, a key aspect of REACH is that it places the burden on  manufacturers, importers, and downstream users to ensure that they  manufacture, place on the market, or use such substances that do not  adversely affect human health or the environment. Its provisions are  underpinned by the precautionary principle. In general, the precautionary  principle means that where there are threats of serious or irreversible  damage, lack of full scientific certainty shall not be used as a reason for  postponing cost-effective measures to reduce risks to human health and  the environment.
section_title: EPA Lacks Adequate Information on Potential Health and Environmental Risks of Toxic Chemicals
paragraphs: While TSCA authorizes EPA to review existing chemicals, it generally  provides no specific requirement, time frame, or methodology for doing  so. Significantly, chemical companies are not required to develop and  submit toxicity information to EPA on existing chemicals unless the  agency finds that a chemical may present an unreasonable risk of injury to  human health or the environment or is or will be produced in substantial  quantities and that either (a) there is or may be significant or substantial  human exposure to the chemical or (b) the chemical enters the  environment in substantial quantities. EPA must also determine there are  insufficient data to reasonably determine the effects on health or the  environment and that testing is necessary to develop such data before it  can require a company to test its chemicals for harmful effects. This  structure places the burden on EPA to demonstrate a need for data on a  chemical’s toxicity rather than on a company to demonstrate that a  chemical is safe. As a result, EPA does not routinely assess the risks of the  roughly 80,000 industrial chemicals in use.
EPA has begun to rely on voluntary programs for data, such as the High  Production Volume Challenge program, where companies voluntarily  agree to provide EPA certain data on high-production volume chemicals.  However, these programs may not provide EPA with complete data in a  timely manner. For example, there are currently over 200 high-production- volume chemicals for which chemical companies have not voluntarily  agreed to provide the minimal test data that EPA believes are needed to  initially assess their risks. EPA officials told us that in cases where  chemical companies do not voluntarily provide test data and health and  safety studies in a complete and timely manner, requiring the testing of  existing chemicals of concern—those chemicals for which some suspicion  of harm exists—is the only practical way to ensure that the agency obtains  the needed information. Furthermore, many additional chemicals are  likely to become high production chemicals because the specific  chemicals used in commerce are constantly changing, as are their  production volumes.
However, EPA officials told us that it is time-consuming, costly, and  inefficient for the agency to use TSCA’s two-step process of (1) issuing  rules under TSCA (which can take months or years to develop) to obtain  exposure data or available test data that the chemical industry does not  voluntarily provide to EPA and then (2) issuing additional rules requiring  companies to perform specific tests necessary to ensure the safety of the  chemicals tested. Officials also said that EPA’s authority under TSCA to  issue rules requiring chemical companies to conduct tests on existing  chemicals has been difficult to use because the agency must first make  certain findings before it can require testing. Specifically, TSCA requires  EPA to find that current data is insufficient; testing is necessary; and that  either (1) the chemical may present an unreasonable risk or (2) that the  chemical is or will be produced in substantial quantities and that there is  or may be substantial human or environmental exposure to the chemical.
Once EPA has made the required findings, the agency can issue a  proposed rule for public comment, consider the comments it receives, and  promulgate a final rule ordering chemical testing. EPA officials told us that  finalizing rules can take from 2 to 10 years and require the expenditure of  substantial resources. Given the time and resources required, the agency  has issued rules requiring testing for only about 200 chemicals. Because  EPA has used authority to issue rules to require testing so sparingly, it has  not continued to maintain information on the cost of implementing these  rules. However, in our October 1994 report on TSCA, we noted that EPA  officials told us that issuing such a rule can cost hundreds of thousands of  dollars. Given the difficulties involved in requiring testing, EPA officials do  not believe that TSCA provides an effective means for testing a large  number of existing chemicals. They believe that EPA could review  substantially more chemicals in less time if they had the authority to  require chemical companies to conduct testing and provide test data on  chemicals once they reach a substantial production volume, assuming  EPA had first determined that these data cannot be obtained without  testing. We have long held a similar view based on our reviews involving  TSCA. For example, in our in June 2005 report, we recommended that the  Congress consider giving EPA the authority to require chemical  manufacturers and processors to develop test data based on substantial  production volume and the necessity for testing. We continue to believe  that providing EPA with more authority to obtain test data from  companies would enhance the effectiveness of TSCA.
In contrast with TSCA’s provisions for obtaining information on  chemicals, we found that REACH, the legislation through which the  European Union has recently revised its chemical control policy, requires  chemical companies to develop more information than TSCA on the  effects of chemicals on human health and the environment. REACH  generally requires that chemical companies provide to, and in some cases  develop for, government regulators information on chemicals’ effects on  human health and the environment, while TSCA generally does not. For  example, under REACH, chemical companies provide information on  chemicals’ properties and health and environmental effects for chemicals  produced over specified volumes. REACH also provides regulators the  general authority to require chemical companies to provide additional test  data and other information when necessary to evaluate a chemical’s risk to  human health and the environment. In contrast, TSCA places the burden  on EPA to demonstrate that data on health and environmental effects are  needed.
Regarding new chemicals, TSCA generally requires chemical companies to  notify EPA of their intent to manufacture or import new chemicals and to  provide any available test data. Yet EPA estimates that most  premanufacture notices do not include test data of any type, and only  about 15 percent include health or safety test data. Chemical companies  do not have an incentive to conduct these tests because they may take  over a year to complete, and some tests may cost hundreds of thousands  of dollars. Because EPA generally does not have sufficient data on a  chemical’s properties and effects when reviewing a new chemical, EPA  uses models to compare new chemicals with chemicals with similar  molecular structures for which test data on health and environmental  effects are available.
EPA bases its exposure estimates for new chemicals on information  contained in premanufacture notices. However, the anticipated production  volume, uses, exposure levels, and release estimates outlined in these  notices generally do not have to be amended once manufacturing begins.  That is, once EPA completes its review and production begins, chemical  companies are not required under TSCA to limit the production of a  chemical or its uses to those specified in the premanufacture notice or to  submit another premanufacture notice if changes occur. However, the  potential risk of injury to human health or the environment may increase  when chemical companies increase production levels or expand the uses  of a chemical. TSCA addresses expanded uses of chemicals by authorizing  EPA to promulgate a rule specifying that a particular use of a chemical  would be a significant new use. However, EPA has infrequently issued  such rules, which require manufacturers, importers, and processors of the  chemical for the new use to notify EPA at least 90 days before beginning  manufacturing or processing the chemical for that use.
An option that could make TSCA more effective would be to revise the act  to require companies to test their chemicals and submit the results to EPA  with their premanufacture notices. Currently, such a step is required only  if EPA makes the necessary findings and promulgates a testing rule. A  major drawback to testing is its cost to chemical companies, possibly  resulting in a reduced willingness to perform chemical research and  innovation. To ameliorate such costs, or to delay them until the new  chemicals are produced in large enough quantity to offset the cost of  testing, requirements for testing could be based on production volume.  For example, in Canada and the European Union, testing requirements for  low-volume chemicals are less extensive and complex than for those for  high-volume chemicals. Congress could give EPA, in addition to its current  authorities under section 4 of TSCA, the authority to require chemical  substance manufacturers and processors to develop test data based on, for  example, substantial production volume and the necessity for testing.
Another option would be to provide EPA with greater authority to require  testing targeted to those areas in which EPA’s analysis models do not  adequately predict toxicity. For example, EPA could be authorized to  require such testing if it finds that it cannot be confident of the results of  its analysis (e.g., when it does not have sufficient toxicity data on  chemicals with molecular structures similar to those of the new chemicals  submitted by chemical companies.) Under such an option, EPA could  establish a minimal set of tests for new chemicals to be submitted at the  time a chemical company submits a premanufacture notice for the  chemical for EPA’s review. Additional and more complex and costly  testing could be required as the new chemical’s potential risks increase,  based on, for example, production or environmental release levels.
According to some chemical companies, the cost of initial testing could be  reduced by amending TSCA to require EPA to review new chemicals  before they are marketed, rather than before they are manufactured. In  this regard, according to EPA, about half of the premanufacture notices  the agency receives from chemical companies are for new chemicals that,  for various reasons, never enter the marketplace. Thus, requiring  companies to conduct tests and submit the resulting test data only for  chemicals that are actually marketed would be substantially less  expensive than requiring them to test all new chemicals submitted for  EPA’s review.
Likewise, TSCA’s chemical review provisions could be strengthened by  requiring the systematic review of existing chemicals. In requiring that  EPA review premanufacture notices within 90 days, TSCA established a  firm requirement for reviewing new chemicals, but the act contains no  similar requirement for existing chemicals unless EPA determines by rule  that they are being put to a significant new use. TSCA could be amended  to establish a time frame for the review of existing chemicals, putting  existing chemicals on a more equal footing with new chemicals. However,  because of the large number of existing chemicals, EPA would need the  flexibility to identify which chemicals should be given priority. TSCA  could be amended to require individual chemical companies or the  industry as a whole to compile and submit chemical data, such as that  included in EPA’s High Production Volume (HPV) Challenge Program, for  example, as a condition of manufacture or import above some specified  volume.
section_title: TSCA’s Regulatory Framework Impedes EPA’s Efforts to Control Toxic Chemicals
paragraphs: While TSCA authorizes EPA to issue regulations that may, among other  things, ban existing toxic chemicals or place limits on their production or  use, the statutory requirements EPA must meet to do so present a legal  threshold that has proven to be difficult for EPA. Specifically, in order to  regulate an existing chemical under section 6 of TSCA, EPA must find that  there is a reasonable basis to conclude that the chemical presents or will  present an unreasonable risk of injury to health or the environment. EPA  officials believe that demonstrating an unreasonable risk is a more  stringent requirement than demonstrating, for example, a significant risk,  and that a finding of unreasonable risk requires an extensive cost-benefit  analysis. In addition, before regulating a chemical under section 6, the  EPA Administrator must consider and publish a statement regarding  the effects of the chemical on human health and the magnitude of human  exposure to the chemical;  the effects of the chemical on the environment and the magnitude of the  environment’s exposure to the chemical;  the benefits of the chemical for various uses and the availability of  substitutes for those uses; and  the reasonably ascertainable economic consequences of the rule, after  consideration of the effect on the national economy, small business,  technological innovation, the environment, and public health.
Moreover, while TSCA offers EPA a range of control options when  regulating existing chemicals—ban or restrict a chemical’s production,  processing, distribution in commerce, or disposal or use, or require  warning labels on the chemicals—EPA is required to choose the least  burdensome requirement that will be adequately protective. For example,  if EPA finds that it can adequately manage the unreasonable risk of a  chemical by requiring chemical companies to place warning labels on the  chemical, EPA may not ban or otherwise restrict the use of that chemical.  EPA must also develop substantial evidence in the rulemaking record in  order to withstand judicial review. Under TSCA, a court reviewing a TSCA  rule “shall hold  unlawful and set  aside…if the court finds that the  rule is not supported by substantial evidence in the rulemaking record.” As  several courts have noted, the substantial evidence standard is more  rigorous than the arbitrary and capricious standard normally applied to  rulemaking under the Administrative Procedure Act. Further, according to  EPA officials, the economic costs of regulating a chemical are usually  more easily documented than the risks of the chemical or the benefits  associated with controlling those risks, and it is difficult to show  substantial evidence that EPA is promulgating the least burdensome  requirement.
EPA has had difficulty demonstrating that harmful chemicals pose an  unreasonable risk and consequently should be banned or have limits  placed on their production or use. In fact, since Congress passed TSCA  nearly 33 years ago, EPA has issued regulations under the act to ban or  limit or restrict the production or use of only five existing chemicals or  chemical classes. Significantly, in 1991, EPA’s 1989 regulation broadly  banning asbestos was largely vacated by a federal appeals court decision  that cited EPA’s failure to meet statutory requirements. In contrast to the  United States, the European Union, as well as a number of other countries,  has banned all, or almost all, asbestos and asbestos-containing products.
Asbestos, which refers to several minerals that typically separate into very  tiny fibers, is a known human carcinogen that can cause lung cancer and  other diseases if inhaled. Asbestos has been used widely in products such  as fireproofing, thermal insulation, and friction products, including brake  linings. EPA invested 10 years in exploring the need for the asbestos ban  and in developing the regulation. Based on its review of over 100 studies of  the health risks of asbestos as well as public comments on the proposed  rule, EPA determined that asbestos is a potential carcinogen at all levels of  exposure—that is, that it had no known safe exposure level. EPA’s 1989  rule under TSCA section 6 prohibited the future manufacture, importation,  processing, and distribution of asbestos in almost all products. In  response, some manufacturers of asbestos products filed suit against EPA  arguing, in part, that the rule was not promulgated on the basis of  substantial evidence regarding unreasonable risk. In October 1991, the  U.S. Court of Appeals for the Fifth Circuit agreed with the chemical  companies, concluding that EPA had failed to muster substantial evidence  to justify its asbestos ban and returning parts of the rule to EPA for  reconsideration.
Specifically, the court concluded that EPA did not present sufficient  evidence to justify the ban on asbestos because it did not consider all  necessary evidence and failed to show that the control action it chose was  the least burdensome regulation required to adequately protect human  health or the environment. EPA had not calculated the risk levels for  intermediate levels of regulation because it believed there was no asbestos  exposure level for which the risk of injury or death was zero. As  articulated by the court, the proper course of action for EPA, after an  initial showing of product danger, would have been to consider each  regulatory option listed in TSCA, beginning with the least burdensome,  and the costs and benefits of each option. The court further criticized  EPA’s ban of products for which no substitutes were currently available  stating that, in such cases, EPA “bears a tough burden” to demonstrate, as  TSCA requires, that a ban is the least burdensome alternative. In addition,  the court stated that in evaluating what risks are unreasonable, EPA must  consider the costs of any proposed actions; moreover, the court noted that  TSCA’s requirement that EPA impose the least burdensome regulation  reinforces the view that EPA must balance the costs of its regulations  against their benefits. After completing the 1989 asbestos rule, EPA has  completed only one regulation to ban or limit the production or use of an  existing chemical (for hexavalent chromium in 1990). Further, EPA has  not completed any actions to ban or limit toxic chemicals under section 6  since the court rejected its asbestos rule in 1991.
With EPA’s limited actions to control toxic chemicals under TSCA, state  and federal actions have established controls for some toxic chemicals.  For example, a California statute enacted in 2007 prohibits the  manufacture, sale, or distribution of certain toys and child care articles  after January 1, 2009, if the products contain concentrations of phthalates  exceeding 0.1 percent. In 2008, Congress took similar action. California  has also enacted limits on formaldehyde in pressed wood. In response to a  petition asking EPA to use section 6 of TSCA to adopt the California  formaldehyde regulation, EPA recently issued an advance notice of  proposed rulemaking suggesting several regulatory options the agency  could pursue under its TSCA section 6 authority to limit exposure to  formaldehyde. However, because of the legal hurdles the agency would  face in regulating formaldehyde under TSCA, some stakeholders have  recommended that EPA pursue legislation to control formaldehyde.
In our previous reports on TSCA, we identified a number of options that  could strengthen EPA’s ability to regulate harmful chemicals under TSCA  and enhance EPA’s ability to protect public health and the environment.  Potential changes to TSCA include reducing the evidentiary burden that  EPA must meet to take regulatory action under the act by amending the  (1) unreasonable risk standard that EPA must meet to regulate existing  chemicals under section 6 of TSCA, (2) standard for judicial review that  currently requires a court to hold a TSCA rule unlawful and set it aside  unless it is supported by substantial evidence in the rulemaking record,  and (3) requirement that EPA choose the least burdensome regulatory  requirement. We have previously recommended that the Congress amend  TSCA to reduce the evidentiary burden that EPA must meet.
Alternatively, the European Union’s recently enacted chemical control  legislation, REACH, represents a regulatory model that differs from the  TSCA framework in key ways. For example, REACH is based on the  principle that chemical companies have the responsibility to demonstrate  that the chemicals they place in the market, distribute, or use do not  adversely affect human health or the environment, while TSCA generally  requires EPA to demonstrate that chemicals pose risks to human health or  the environment prior to controlling risks related to their production,  distribution, or use. In addition, under REACH, chemical companies must  obtain authorization to continue to use a chemical of very high concern,  such as a chemical for which there is scientific evidence of probable  serious health or environmental effects. Generally, to obtain such  authorization, the chemical company needs to demonstrate that it can  adequately control risks posed by the chemical, such as by requiring that  workers wear safety equipment when working with the chemical or  otherwise ensuring that the chemical is produced under safe conditions. If  the chemical company cannot provide evidence of adequate control,  authorization would be granted only if the socioeconomic advantages of a  specific use of the chemical are greater than its potential risks, and if there  are no suitable alternatives or technologies. This process substantially  differs from TSCA’s section 6 requirements as discussed above.
section_title: EPA’s Ability to Share Information Under TSCA’s Confidential Business Information Provisions Are Limited
paragraphs: EPA’s ability to make publicly available the information that it collects  under TSCA is limited. Chemical companies may claim some of the  information they provide to EPA under TSCA as confidential business  information. EPA is required under the act to protect trade secrets and  privileged or confidential commercial or financial information against  unauthorized disclosures, and this information generally cannot be shared  with others, including state health and environmental officials and foreign  governments. However, some state officials believe this information would  be useful for informing and managing their environmental risk programs.  Furthermore, while EPA believes that some claims of confidential  business information may be unwarranted, challenging the claims is  resource-intensive.
EPA has not performed any recent studies of the appropriateness of  confidentiality claims, but a 1992 EPA study indicated that problems with  inappropriate claims were extensive. This study examined the extent to  which companies made confidential business information claims, the  validity of the claims, and the impact of inappropriate claims on the  usefulness of TSCA data to the public. While EPA may suspect that some  chemical companies’ confidentiality claims are unwarranted, the agency  does not have data on the number of inappropriate claims. According to  EPA, about 95 percent of premanufacture notices contain some  information that chemical companies claim as confidential. EPA officials  also told us that the agency does not have the resources that would be  needed to investigate and, as appropriate, challenge claims to determine  the number that are inappropriate. Consequently, EPA focuses on  investigating primarily those claims that it believes may be both  inappropriate and among the most potentially important—that is, claims  relating to health and safety studies performed by the chemical companies  involving chemicals currently used in commerce. The EPA official  responsible for initiating challenges to confidentiality claims told us that  EPA challenges about 14 such claims each year and that the chemical  companies withdraw nearly all of the claims challenged.
Officials who have various responsibilities for protecting public health and  the environment from the dangers posed by chemicals believe that having  access to confidential TSCA information would allow them to examine  information on chemical properties and processes that they currently do  not possess and could enable them to better control the risks of  potentially harmful chemicals. Likewise, the general public may also find  information provided under TSCA useful. Individual citizens or community  groups may have a specific interest in information on the risks of  chemicals that are produced or used in nearby facilities. For example,  neighborhood organizations can use such information to engage in  dialogue with chemical companies about reducing chemical risks,  preventing accidents, and limiting chemical exposures.
While both TSCA and REACH have provisions to protect information  claimed by chemical companies as confidential, REACH requires greater  public disclosure of certain information, such as basic chemical  properties. Furthermore, REACH places greater restrictions on the kinds  of information chemical companies may claim as confidential. For  example, REACH includes a provision for public access to basic chemical  information, including brief profiles of hazardous properties and  authorized uses. The European Union’s approach to public’s access to  information combines a variety of ways that the interests of the public’s  right to know is balanced with the need to keep certain information  confidential. As such, nonconfidential information will be published on the  chemical agency’s Web site. REACH also includes a provision under which  confidential information can generally be shared with government  authorities of other countries or international organizations under an  agreement between the parties provided that certain conditions are met.
In previous reports, we recommended that the Congress consider  providing EPA additional authorities under TSCA to improve its ability to  make more chemical information publicly available. For example, in our  June 2005 report, we recommended that the Congress consider amending  TSCA to authorize EPA to share with the states and foreign governments  the confidential business information that chemical companies provide to  EPA, subject to regulations to be established by EPA in consultation with  the chemical industry and other interested parties that would set forth the  procedures to be followed by all recipients of the information in order to  protect the information from unauthorized disclosures. In our September  1994 report, we recommended that the Congress consider limiting the  length of time for which information may be claimed as confidential  without resubstantiation of the need for confidentiality.
Mr. Chairman, this concludes my prepared statement. I would be happy to  respond to any questions that you or Members of the Subcommittee may  have.
section_title: Contacts and Acknowledgments
paragraphs: For further information about this testimony, please contact John  Stephenson at (202) 512-3841 or stephensonj@gao.gov. Key contributors to  this testimony were David Bennett, Antoinette Capaccio, Nancy Crothers,  Christine Fishkin, Richard Johnson, and Ed Kratzer.
section_title: Related GAO Products
paragraphs: High-Risk Series: An Update. GAO-09-271. Washington, D.C.: January 22,  2009.
Chemical Regulation: Comparison of U.S. and Recently Enacted  European Union Approaches to Protect against the Risks of Toxic  Chemicals. GAO-07-825. Washington, D.C.: August 17 2007.
Chemical Regulation: Actions are Needed to Improve the Effectiveness of  EPA’s Chemical Review Program. GAO-06-1032T. Washington, D.C.:  August 2, 2006.
Chemical Regulation: Options Exist to Improve EPA’s Ability to Assess  Health Risks and Manage Its Chemical Review Program. GAO-05-458.  Washington, D.C.: June 13, 2005.
Toxic Substances Control Act: Legislative Changes Could Make the Act  More Effective. GAO/RCED-94-103. Washington, D.C.: September 26, 1994.
This is a work of the U.S. government and is not subject to copyright protection in the  United States. The published product may be reproduced and distributed in its entirety  without further permission from GAO. However, because this work may contain  copyrighted images or other material, permission from the copyright holder may be  necessary if you wish to reproduce this material separately.