Ernie Rosenberg, President & CEO The Soap and Detergent Association

1. American Bar AssociationStanding Committee on Environmental Law38th National Spring Conference on the EnvironmentCHEMICALS REGULATION: REACHing for TSCA ReformLegal Liability, Risk Management, And Regulatory IncentivesJune 11, 2010 Ernie Rosenberg, President & CEO The Soap and Detergent Association

2. TSCA reform & REACH • Both REACH and the current legislative proposals are unworkable • Both create numerous marketplace risks in addition to their direct impacts • Both have unintended adverse consequences • But TSCA does need to be updated

3. Too early to judge REACH • Little has happened yet, the first registrations are not yet due • Few chemicals listed as “Substances of Very High Concern” (SVHCs)—those requiring “Authorization” • Registration deadline for: • Substances of Very High Concern • Production volume ≥2.2 million lbs/yr • (1,000t metric tons) REACH entered into force Registration deadline for: ≥1tpa Registration deadline for: ≥220,000 tpa Jun Dec Jun Jun 2007 2008 2009 2010 2011 2012 2013 2017 2018

4. REACH: uncertainties & liabilities • Registration process untested; problems already arising • Many smaller companies will miss deadlines, file incomplete or defective dossiers, lose customers, or drop the European market • Guidance still being issued; some will be challenged; many uncertainties • Consequences? • Biggest concern: “deselection” of chemicals listed as SVHCs & need to reformulate • Enforcement: basically discretionary; varies from one country to another and political

5. REACH: uncertainties & liabilities • Restrictions – the missing letter in REACH • Must be proposed by a Member State • Nominal standard for control: “unacceptable risk” • Final decisions largely political; many uncertainties • New Classification, Labeling & Packaging Regulation—adjunct to REACH • Requires hazard (not risk) classification of chemicals and, in the next few years, classification of mixtures • Could result in deselection and reformulation • Product liability outside of the EU

6. REACH: uncertainties & liabilities • A (very) little good news for companies doing business in or with the EU • No citizen suits; no bounty hunter enforcement • Little concern for product liability inside the EU • Liabilities beyond the EU due to SVHC listing and Authorization conditions and accompanying findings • Deselection by the anyone “downstream” of the chemical and formal restrictions in procurement programs • Product liability • Loss of brand value • Listing, use restrictions by States (e.g., Prop. 65)

7. TSCA today • TSCA reputed to be ineffective; reasons given: • There’s no data on 82,000 chemicals (Not true) • Too little use of TSCA authorities to gather information • Too few chemicals restricted (Perhaps) • Safety standard is hard to apply and not sufficiently protective of children and other sensitive populations • Most of the chemical and formulated product industries agree the law needs to be brought up to date

8. TSCA today—too few actions? • TSCA is not a pollution control statute • It is a product regulation law; there’s no presumption that the products are bad • All pollution has to be limited; it has no commercial utility • TSCA is more akin to statutes prohibiting behavior • You don’t measure their effectiveness by counting the violations • If TSCA had generated a lot of adversarial actions (rules, orders), then it would be a failure • It would not have prevented the problems • Many uses that should have been restricted voluntarily (or because of tort liability) would not have been

9. TSCA problems and successes • TSCA is too hard for the agency to use • Especially §4, §6, §8(d) (though some of the difficulty has been self-imposed) • But • TSCA has made safety a design criterion for new chemicals and for the use of existing chemicals in new applications • TSCA §5 has been effective and useful because of Agency creativity and industry voluntary cooperation • Innovation has been robust in the United States—more so than anywhere else in the world • The balance built into §5 has been somewhat enabling

10. TSCA reform—current proposals • Basic “ready, fire, aim” approach, but some of the most critical problems are: • Excessively conservative safety standards • Inclusion of articles and mixtures • TSCA now addresses articles and mixtures, but its actions have to be limited to uses that present an unreasonable risk • Proposals require too much, too quickly and in too many cases that will be unproductive—chemicals that are of less concern due to toxicity or uses that contain exposures and releases

11. TSCA reform • The bill in the Senate and the draft bill in the House are worse than REACH • Amending them would be very difficult since the underlying policies and concepts are woven throughout both • Innovation killers: • Data requirements for all PMNs and requiring EPA to approve uses • Requirements for approval of new uses • Limitations on confidential business information

12. TSCA reform liabilities • Worse than REACH both because of substanitve provisions and because of our administrative process, judicial review and other citizen suits • Introduction of new products, even those that improve the environmental footprint, would be hindered if not blocked entirely • The listing of priority chemicals without timely resolution would threaten: • Deselection by the anyone “downstream” of the chemical and formal restrictions in procurement programs • Product liability • Loss of brand value

13. Conclusion • It is too soon to assess REACH, but the EU has more latitude to muddle through • The current TSCA proposals have to be rewritten to • Make the workload manageable • Focus on cases of harm to human health and the environment • Limit excess costs and animal testing • Protect innovation and U.S. competitive position and jobs • Both REACH and, probably, a reformed TSCA will create market risks and liabilities beyond the requirements of compliance

14. THANK YOUErnie Rosenberg, President & CEOThe American Cleaning Institute℠(The Soap and Detergent Association)1331 L Street NW, Suite 650Washington, DC 20005202.662.2505erosenberg@cleaninginstitute.orgWebsite: www.cleaninginstitute.org