Managing Compliance: New Year, New Compliance Challenges

The risks and costs of non-compliance are rising as the regulatory environment becomes more challenging. Compliance needs are pervasive and persistent across all geographical jurisdictions and vertical industries. Today's EHS professional faces a vast and complex regulatory landscape that includes regulatory authorities focused on products, the workplace, the environment, transportation and homeland security, as well as international, EU, federal, state and local regulations. EHS management now often encompasses requirements that extend beyond the enterprise, including upstream and downstream supply chain management.

The last 2 years have given shape to a complex regulatory landscape, with the United Nations' Globally Harmonized System of Classification and Labeling of Chemicals (GHS); the European Union's (EU) Registration, Evaluation, Authorization and Restriction of Chemicals (REACH) regulatory framework; and the possible reform of the United States' Toxic Substance Control Act (TSCA) taking center stage. The new year dawned with continued change on the horizon and we anticipate that 2011 will bring many new compliance challenges.

By reviewing a representative sample of the regulatory challenges that emerged in 2010, we can better prepare for 2011's emerging challenges and begin to prioritize strategies and tactics that align with these challenges.

OSHA GHS

In 2010, we learned more about the proposed rule to align OSHA's hazard communication (hazcom) standard with provisions of the UN Globally Harmonized System of Classification and Labeling of Chemicals (GHS). With the final rule expected to be promulgated sometime around March 2011, we can anticipate many new compliance challenges in the very near future, including the need to re-evaluate how substances and mixtures are classified, creating the need to re-issue MSDSs and labels and train staff as appropriate.

REACH

REACH continued to present significant compliance challenges in late 2010, especially during the last few months of the year. Many companies struggled to meet the Nov. 30, 2010, deadline to register substances classified as high-volume or hazardous and to revise the labels and safety data sheets for these substances.

We also noticed confusion surrounding the requirements related to safety data sheets, which were due to be in place from Dec. 1, 2010. Understanding all of the requirements has been extremely challenging, especially as guidance from the European Chemicals Agency (ECHA) has been delayed and in certain areas, non-existent. We anticipate that this trend will continue in 2011 and while approaching the next registration deadline in 2013, as companies work to establish and maintain a good and reliable inventory of substances in all chemicals (substances, mixtures and chemicals in articles) that are sold in the EU.

TSCA Reform

In 2010, we also saw momentum building for significant reform of the Toxic Substance Control Act (TSCA). If promulgated, the proposed Safe Chemicals Act of 2010 (SCA) legislation dramatically will change the current scope of TSCA. Many companies will be affected by these changes, as almost every business involved in the chemical industry is impacted by TSCA in some way.

Proposed new legislative requirements include:

Minimum data set (MDS) for each chemical produced, with EPA having the authority to request the additional data required to make a safety determination.
EPA prioritization based on MDS, considering exposure and hazard characteristics.
EPA quick action on chemicals demonstrating high risk.
Restrictions on the data claimed by industry to be confidential.

In addition, raw materials, intermediates and finished goods are regulated by TSCA. Full lifecycle, or cradle-to-grave, compliance is an essential component of TSCA, and most manufacturing/importing, processing and disposal activities are TSCA regulated.

ORM-D

For many companies that transport consumer commodities, the ORM-D exception has become the standard way of handling transportation of hazardous materials through their supply chain. Many companies have built logistics systems and training programs around utilization of this exception in order to safely ship hazardous materials in compliance with the transportation regulations of 49CFR. Annually, the Pipeline and Hazardous Materials Safety Administration (PHMSA) publishes a notice of proposed rulemaking (NPRM) to harmonize the current hazardous materials regulations, codified 49CFR, with United Nations requirements, determining which of these changes to adopt.

The most recent NPRM, published Aug. 24, 2010, is a potential game changer that dramatically will affect how companies transport hazardous materials in the United States. In this proposal, the U.S. Department of Transportation would phase out the use of the ORM-D and ORM-D-Air exceptions and conform to international standard for limited quantity shipments as the primary alternative for shipping consumer commodities as anything other than fully regulated shipments.

The phase out of these exceptions could be implemented as soon as Jan. 1, with mandatory compliance starting Jan. 1, 2014. While elimination of the ORM-D Consumer Commodity exception may be beneficial in the long term, there may be an immediate impact of companies seeking to re-evaluate their current policies and practices to ensure they are prepared to continue to transport hazardous materials in compliance with these new regulations. Many companies will be challenged to re-evaluate and update aspects of their transportation programs, including employee training, transportation systems, packaging and existing classifications for products that are transported.

A COMPLEX REGULATORY LANDSCAPE

Future editions of this column will discuss these challenges in further detail, with a particular emphasis on strategies and practical tactics for achieving environmental regulatory compliance. Achieving and maintaining compliance can be a daunting task, especially with the regulatory landscape constantly shifting and changing.

We also plan to address the impact of emerging regulatory developments, as well as the role of product stewardship initiatives throughout the supply chain, how EHS activities can be leveraged for green chemistry and sustainability initiatives and criteria for evaluating and integrating substance-level, product-specific, regulatory data into compliance activities.

We also welcome article topic suggestions. Please e-mail your ideas to [email protected].

Jytte Syska is president, Ariel Operations, and managing director, 3E Co. Europe. Syska has more than 20 years of experience as an EHS regulatory expert and served as vice president of International Operations before taking on the role of president of Ariel, in charge of all business units that support Ariel products and services. Isaac Powell is product manager for 3E Co.'s Technical Services. He is a member of AHMP, NFPA and the International Code Council and is certified as a hazardous materials manager by IHMM.