PFAS Updates, EU and Saudi Arabia RoHS: A Busy Summer for Environmental Compliance

U.S. PFAS Update: EPA Public Comment Period Open Now

In June, the U.S. Environmental Protection Agency (EPA) issued a “Pre-publication Notice for TSCA Section 8(a)(7) Reporting and Recordkeeping Requirements for Perfluoroalkyl and Polyfluoroalkyl Substances.”

The notice was ultimately published in the Federal Register on June 27. The EPA will accept public comments on the proposed rule until September 27.

A few key points for manufacturers to understand are:

1. This one-time regulation will authorize EPA to request – and obtain – information about products containing over 1,100 different PFAS substances imported into the country or manufactured in the USA over the past ten years
2. This regulation was mandated in the National Defense Authorization Act for Fiscal Year 2020. See Sec. 7351, “PFAS DATA CALL”
3. The EPA has required this level of information in the past from industry, but – as far as I can tell – never from article-manufacturing industries. The key sentence resulting in the inclusion of these industries is:

… articles containing PFAS, including imported articles containing PFAS (such as articles containing PFAS as part of surface coatings), are included in the scope of reportable chemical substances.

In my opinion, the EPA significantly underestimates the number of respondents at 234 and the total estimated cost at just under $10 million per year for the entirety of the American manufacturing industry. A better understanding of the electronics industry and the supply chain would undoubtedly result in a far greater number of respondents and far higher cost estimate.
Note that small businesses are not excluded from these rules.

The EPA must publish a final rule no later than January 1, 2023. A six-month reporting period would begin six months after the effective date of the final rule. Now is the time to get your comments in!

European Union PFAS Update

On July 21, the European Chemicals Agency issued an email that said:

Denmark, Germany, the Netherlands, Norway and Sweden have submitted an intention to restrict the manufacture, placing on the market and use of per- and polyfluoroalkyl substances (PFAS) (EC/CAS -) on 15 July 2021. We expect to receive their restriction proposal by 15 July 2022.

The five countries have launched a survey on PFAS and their alternatives and are looking for more information for the intended restriction. The deadline for comments is 19 September 2021.

A regulatory management option analysis conclusion document (RMOA) is also available on our website.

As the amount of focus and level of interest has risen on PFAS in general over the past decade (beyond PFOA and PFOS), the likelihood of action has risen as well. Manufacturers whose products are dependent on these substances at any level would do well to assess their essentiality and alternatives as quickly and thoroughly as possible.

EU REACH and RoHS Updates

Eight substances were added to the candidate list of substances of very high concern (SVHCs) on July 8, bringing the current total number of listed substances to 219.

One substance of particular interest to electronics manufacturers and their supply base is medium-chain chlorinated paraffins (MCCP). This group of substances is used as a flame retardant and plasticizer in PVC cable insulation and sheathing as well as in other applications. Expect MCCP to be restricted under EU RoHS soon (along with TBBP-A).

Speaking of RoHS, the tracking list of exemptions (validity and rolling plan) has been updated. Furthermore, the full list of exemption requests submitted to the Commission between November 2019 and January 2020 has also been published.

Finally, the European Commission plans to hold a stakeholder consultation on the next RoHS Recast (“RoHS 3”) this fall. They expect it to be adopted by Q4 of 2022. Keep your eye on the roadmap to be notified and submit comments.

Saudi Arabia’s RoHS Approach Becomes Law

As noted in a recent article by Compliance & Risks, Saudi Arabia, despite poor publicizing and no stakeholder consultation I was aware of, has passed its version of RoHS into law. While the law takes a lot of wording from EU RoHS rather directly, it also includes a conformity assessment requirement and apparent submission of the technical file with the product!

Technical files contain plenty of proprietary and confidential information, so this seems to be rather problematic. Furthermore, it mandates ISO 9001 certification (or its equivalent).

Two useful resources available on the web are:

1. The regulation itself, including a welcome English translation of the regulation from the Saudi government's standards website.
2. A list of conformity assessment bodies around the world authorized to perform the conformity assessment
   

Funding and Acquisitions in the Environmental Compliance Services Sector

The product environmental compliance sector went for what seemed like a very long time (perhaps a decade or more) without a significant acquisition or funding round until Assent Compliance received an investment of CAD$130M in October 2018. That seems to have kicked up some dust in the industry. Here’s a round-up of recent funding and M&A:

• iPoint Systems received a “strategic investment” from GRO Capital in November 2020.
• Chemical Watch was acquired by Enhesa in December 2020. Enhesa itself was acquired by a private equity fund, CGE Partners, in July 2020 after a February 2017 “investment” by Waterland Private Equity Investments that resulted in a significant change in top management; as the press release says “The former shareholders will pursue other opportunities outside the EHS industry and wish the management team success with the further growth of the company.”
• Compliance & Risks received a “significant investment” from Luminate Capital Partners in July 2021
• Also as of July 2021, Total Parts Plus has a new “majority investor,” ParkerGale Capital. They have merged with Source Intelligence, which had already been part of ParkerGale’s portfolio.

Expect expanded services, improved tools and capabilities, more advertising, and increased competition. If you’re aware of other funding or M&A activities in this space, please let me know.

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