Regulatory Updates



ATF Transmission Fluid Labeling Requirements


On January 1, 2018, updated labeling and documentation mandates for transmission fluids go into effect automatically in 19 States based on amendments to NIST Handbook 130 adopted in the summer of 2017 by the National Conference on Weights and Measures (NCWM). The regulations recognize that many oil marketers make and sell “suitable for use” or “multi-vehicle” ATFs. Suitable-for-use performance claims, including for multi-vehicle ATFs, are to be based on appropriate field, bench and/or transmission rig testing, including such testing done by additive suppliers. If the product performance claims are based on the claim(s) of one or more additive suppliers, documentation from the additive supplier(s) can be submitted upon request to the state agency.

ILMA members should ensure that, unless they have conducted their own testing, they have or have access to additive company test data for their suitable for use or multi-vehicle ATF performance claims. ILMA members should also be aware that Handbook 130 does not provide for a “sell-through” period for any “old” transmission fluid labels; therefore, on the face of the amendments, all products must meet the applicable labeling and documentation requirements in the 19 identified States by January 1, 2018, regardless of when they were manufactured or distributed.



Chlorinated Paraffins 


The EPA Significant New Use Rule (SNUR) dealing with Chlorinated Paraffins (CPs), published in August 2018, is in the process of review and revision. The SNUR was confusing, and led some to speculate over whether CPs will be banned in the future. The SNUR is intended to apply an existing Consent Order to any manufacturers or importers not already subject to the order. 
Currently CPIA is working on testing standards with the EPA, but CPs are not under Toxic Substances Control Act (TSCA) review right now. The EPA recently approved several new CPs for production, and it is unlikely that a ban will happen in the next few years.




GHS: Global Harmonized Systems Update


OSHA did not launch rulemaking to update its Hazard Communication Standard (HCS) to the most recent edition of the Global Harmonized System (GHS) in February 2019 as expected, instead adding it to the Spring Regulatory Agenda. A Notice of Proposed Rulemaking (NPRM) is expected December 2019. The NPRM should harmonize the HCS with the 2018 GHS update and is expected to codify and HCS enforcement policies in place since publication of the GHS 2012 standard.



Obsolete Oils

 



Overtime Rule

The U.S. Department of Labor issued a proposed rule (NPR) that would increase the minimum salary threshold under the Fair Labor Standards Act (FLSA) to $679 per week ($35,308 annually). Most employees earning under this minimum are entitled to overtime compensation, and is expected to extend coverage to approximately one million U.S. workers. This rule updates the existing rule by recalculating the 20th percentile earnings in line with the formulae used in 2004 to calculate a $455 per week ($23,660 annual) minimum salary.

The NPR also includes unique additions to FLSA rules: (1) Employers man use nondiscretionary bonuses and incentive payments (like commissions) up to 10 percent of an employees salary for threshold calculation, and (2) Employers will have a “catch-up” payment of up to 10 percent of the standard salary level ($3,530.80) within one pay period to meet the threshold.


Paying the minimum salary would not enough to qualify for exemption – the existing “duties tests” is used in conjunction with salary to determine whether an employee is exempt under the FLSA.  The final rule is expected to take effect January 2020.



Recycled Oils Rule

The Federal Trade Commission (FTC) sought
public comment on the costs and benefits associated with its Recycled Oil Rule (Rule) in 2018. The Rule, promulgated in 1995 pursuant to the “Energy Policy and Conservation Act” (EPCA), permits manufacturers and other sellers to represent on a recycled engine-oil container label that the oil is substantially equivalent to new engine oil, as long as the determination of equivalency is based on test procedures prescribed by the FTC.


SPCC: Spill, Prevention, Control and Countermeasure Rule


The EPA opted not to promulgate a “worst-case” hazardous substance discharge rule under Section 311(j)(5) of the Clean Water Act. The decision comes after the EPA determined that existing regulations adequately handle general hazardous substance spills under SPCC. Both rules were required by August 2019 under a 2016 agreement to determine the need for rules governing spills of hazardous substances.  A number of environmental groups filed lawsuits against the EPA over the failure to make new rules, and the status of the lawsuits will be tracked by ILMA.



TSCA: Toxic Substances Control Act

TSCA Inventory: The EPA released an updated TSCA Inventory earlier this year, listing as active or inactive all substances manufactured, processed, or imported into the U.S. The Inventory includes 40,665 active and 45,573 inactive substances, including confidential business chemicals that are not on the publicly available list. Anyone using a chemical designated as “inactive” has until August 5, 2019 to submit a Notice of Activity Form B in order to continue using the substance without disruption. Moving forward, the EPA will not review chemical applications for confidential business information (CBI). Instead, the burden is on industry to claim CBI to ensure that protected product composition or processes is not publicly revealed.

TSCA Prioritization: One addition to TSCA under the 2016 “Frank R. Lautenberg Chemical Safety for the 21st Century Act” is the process of chemical prioritization – designating a chemical as either high- or low-priority. High-priority substances will face further risk evaluation to determine safety, and what limitations should be placed on their use. Low priority means that risk evaluations are not necessary at the time, but may happen in the future. Neither should be interpreted as indications of risk – high-priority chemicals may present no risk, and vice versa. The EPA is required to complete the designation of 20 chemicals as high-priority and 20 as low-priority by December 2019.  The list of chemicals undergoing prioritization can be found here. 

TSCA Framework & Challenges: TSCA framework cases are still ongoing. Recently, the Ninth Circuit pushed back on petitioners seeking to challenge the EPA’s process for evaluating chemical risk, suggesting that lawsuits over individual chemical determinations are more appropriate than attacking a hypothetical process.

TSCA Enforcement: In Spring 2019, the EPA issued the first citation for violation of TSCA to Chemours related to release and manufacturing of next generation Polyfluoroalkyl substances (PFAS). As duties and regulations take shape around both PFAS and TSCA, chemical companies may be subject to more citations for failure to comply with reporting and testing requirements.



WOTUS: Waters of the U.S. Rule


In February 2019, the EPA and Army Corps of Engineers (ACE) published a Notice of Proposed Rulemaking (NPRM) revising the WOTUS rule, with public comments due by April 15, 2019. Prior WOTUS updates have taken around one year to process before final publication, but Trump Administration has said they plan to have a rule in place by 2020. The rule will drastically reduce the jurisdiction of the federal government over waters by changing the definition. The existing “significant nexus” standard from the 2015 rule will be replaced by one requiring direct surface hydrologically connection to navigable waters. In addition, it will likely remove or require a set period of continuous flow for “intermittent” waters to receive federal protections. Environmental scientists and advocacy groups estimate that the 2019 rule will remove federal jurisdiction over 18 percent of streams and 50 percent of wetlands, with states assuming regulatory authority. The NPRM can be viewed here.