Halting Production of Certain Paraffins Called Illegal

By Pat Rizzuto

April 15 — The Environmental Protection Agency exceeded its legal authority in its preliminary decision to end production of five medium- and long-chain chlorinated paraffins and not allow another two new chemicals in that group to enter commerce, according to individual companies and trade associations.

“The complete review of the scientific evidence suggests that EPA has an insufficient legal basis to propose a ban on these substances,” wrote the American Chemistry Council in comments to the agency.

The chemistry council's comments summarized views from a coalition of trade associations representing chemical manufacturers and other manufacturers, such as companies making motor equipment, wire, and nuts and bolts.

The coalition weighed in on preliminary risk assessments the EPA released in December 2015 for the seven chemicals (80 Fed. Reg. 79,886; 40 CRR 5, 1/4/16).

Based on conclusions in the preliminary risk assessments, the EPA proposed to halt the production of five chemicals and prohibit two from being made.

The EPA also requested use, environmental, waste management and other information to refine those analyses.

Comments and requested information were due March 23.

Chlorinated Solvents in Use for Decades

Chlorinated solvents have been in commerce for decades in applications such as lubricants, metal working fluids, flame retardants for plastics, and weather resistant coatings for steel construction and industrial flooring.

The EPA and regulators in other countries have raised concerns for years about a subset of the chlorinated paraffin family, called short-chain chlorinated paraffins, because the agency says they are persistent, bioaccumulative and toxic to aquatic organisms at low concentrations.

The EPA also has been investigating medium- and long-chain chlorinated paraffins. The risk assessments of the seven chemicals listed in the December notice conclude they “may present an unreasonable risk” to aquatic organisms following acute and chronic exposures. The chemicals also “may be very persistent and very bioaccumulative,” EPA's risk assessments said.

Based on these concerns, the EPA's December notice said the agency has informed Dover Chemical Corp., which makes three of the chemicals, and INOVYN Americas Inc., which makes two of the chemicals, that—absent submission of sufficient information to address its environmental concerns—the agency has concluded they should stop making those chemicals.

The EPA said it has told Qualice LLC, which would like to manufacture the remaining two, that—absent submission of the same environmental information—the agency has concluded manufacture should not commence.

ACC Coalition: Significant Economic Disruption

The EPA's decision would have substantial economic impact, the American Chemistry Council's coalition wrote.

Companies reported making or importing about 48 million pounds of medium- and long-chain chlorinated paraffins in 2012, the coalition said.

“Downstream processors and end users have told EPA that for some applications they have no substitutes for medium and long-chain chlorinated paraffins, and for others more than five years are needed to identify, qualify and move to a substitute material,” it said.

The proposed ban on the production and importation of the chemicals would result in significant economic disruption to materials needed by the aerospace, automotive, construction, defense, metallurgy, polymer manufacturing and other industry sectors, the coalition said.

EPA Notice Stems from TSCA Inventory Dispute

Michael Boucher, partner with Dentons US LLP, offered Bloomberg BNA his insights April 13 about the risk assessments and why they and the agency's data request are unusual.

He also summarized perspectives different industries likely have on the agency's actions and ways the agency may move forward.

“Nothing about this process is normal.”

“Nothing about this process is normal,” said Boucher, who represents companies that process medium- and long-chain chlorinated paraffins into various industrial fluids.

The critical, “atypical” aspect, he said, is that the EPA is handling all seven chemicals as new chemicals although at least five—those produced by Dover and INOVYN—have been in commerce.

As part of a legal settlement involving disputes over the identity of chemicals already on the Toxic Substances Control Act inventory, Dover and Ineos Chlor Americas, Inc., now INOVYN, agreed to stop manufacturing short-chain chlorinated paraffins (36 CRR 925, 8/27/12).

Both companies maintain their medium- and long-chain chlorinated paraffins were legally in commerce, but they agreed to submit premanufacture notices (PMNs) for them to address the EPA's allegation the chemicals were not on the TSCA inventory.

Under TSCA, chemicals being made, sold or distributed in the U.S. must be on the inventory. Any others are deemed “new chemicals.”

Manufacturers wishing to make or import new chemicals must submit PMNs to the agency, so the EPA has the opportunity to determine whether the chemicals may pose an unreasonable risk.

Because chlorinated paraffins have long been in commerce, the EPA had extensive information it could use for its risk assessments and it posted the data in the docket for the December notice, Boucher said.

The EPA routinely conducts risk assessments for new chemicals, but the assessments are not typically placed in public dockets due to the proprietary business information they contain, he said.

Key Perspectives

Chemical manufacturers and processors are raising different, but related concerns about the EPA's proposed ban on medium- and long-chain chlorinated paraffins:

  •  manufacturers of these specific chemicals want them on the market as long as possible;
  •  chemical manufacturers and users are concerned by the precedent that the EPA would set by banning or restricting a “new” chemical that has long been in commerce;
  •  chemical users want sufficient time to find useful substitutes for the chlorinated paraffins.


Regulatory Options; Types of Reactions

The agency's conclusion in this case that all seven chemicals may pose an unreasonable risk would allow the EPA to control the risk through several means, Boucher said.

The agency could propose a seldom-used type of rule, authorized under TSCA's new chemicals section, banning or restricting the new chemicals, he said.

The EPA also could control the risks through a Section 5(e) order, which implements a new chemicals provision of the Toxic Substances Control Act, he said.

If the EPA pursues the Section 5(e) order route, which Boucher said was more likely, the order's wording could effectively ban the chemicals from the market.

The orders would apply, however, only to Dover, INOVYN and Qualice, Boucher said.

The EPA would have to follow the Section 5(e) orders with significant new use rules (SNUR) that would restrict or ban any other company from making, importing or processing the chemicals, Boucher said.

In light of these regulatory options, industry comments fell into three basic bins, he said:

  •  manufacturers and importers of chemicals generally and those making the specific chemicals disputed the EPA's risk assessments and preliminary conclusions;
  •  chemical companies and their trade associations disputed the legality of EPA using TSCA's new chemicals authorities to regulate chemicals already in commerce; and
  •  companies that process and use medium- and long-chain chlorinated paraffins provided information about those uses and reasons they need continued access to the chemicals.


Chemical Manufacturers Challenge Risk Assessments


“Given the long-term and continuous use of these materials EPA does not need to rely solely upon models to predict levels in the environment; there are extensive measured data that allow for the assessment of the levels of these chemicals in the environment,” the Chlorinated Paraffins Industry Association wrote.

The American Chemistry Council coalition said “EPA has overstated many aspects of the potential risks for these substances.”

“The coalition believes that the risk assessments do not provide an adequate basis to support EPA's key conclusions medium- and long-chain chlorinated paraffins are expected to be persistent, bioaccumulative and toxic chemicals or that ongoing uses are exceeding concentrations of concern for aquatic and sediment-dwelling organisms,” the ACC wrote.

Legality of Process Challenged

In separate comments, the ACC's coalition and Dow said medium- and long-chain chlorinated paraffins have been in use in the U.S. for decades and were part of the initial TSCA inventory established in 1979.

The chlorinated paraffins on the TSCA inventory are complex mixtures not individual molecular structures, the ACC coalition and Dow said.

EPA encouraged companies to report broad categorical names for chlorinated paraffins on the inventory, meaning many similar compounds may fall under specific Chemical Abstracts Service numbers, they said.

Manufacturers, processors and users of chlorinated paraffins relied in good faith on these existing TSCA Inventory listings before EPA brought its enforcement actions against Dover and INOVYN, Dow said.

If the EPA wanted to make the TSCA inventory identity of chlorinated paraffins more specific, it could have done so using other procedures, Dow said.

“It was inappropriate, as a matter of law and fact, for the EPA to utilize this more specific nomenclature as a legal predicate in the enforcement actions against Dover and INOVYN,” the company said.

Dow, the ACC coalition and the Chlorinated Paraffins Industry Association described regulatory options available to the EPA that would not involve the ban of what the agency has deemed new chemicals.

Boeing: Chemicals ‘Critical' to Aerospace

The Boeing Co. told the EPA: “Continued use of these materials is critical to the aerospace industry.”

“Materials used in manufacturing and maintaining an aircraft have to be developed by material formulators, qualified by Boeing and then certified by the Federal Aviation Administration,” it said.

“Sudden removal of these materials from commerce could therefore hamper the industry's ability to build and maintain aircraft.” Boeing said.

The Industrial Fasteners Association, which represents companies making screws, nuts and bolts, said the fluids its members use, which contain the medium- and long-chain chlorinated paraffins, are key to cutting, grinding and machining parts with the precision manufacturers need.

The Chemical Users Coalition, which represents companies, such as the American Honda Motor Corp., IBM Corp., Intel Corp. and Procter & Gamble Co., said it was struggling to determine the extent to which the medium- and long-chain chlorinated paraffins are part of their members' supply chains.

These as yet incomplete efforts found uses in metalworking fluids that create a wide range of needed machine parts, the Chemical Users Coalition said.

Specialized applications in military hardware also have been identified, it said.

Critical Next Steps

Boucher said the comments submitted by chemical manufacturers and processors raise different but related concerns.

The manufacturers of these chemicals specifically want to keep them on the market as long as possible, he said.

Chemical companies and associations representing organizations that purchase and use chemicals already in commerce, are concerned about the precedent EPA would set by banning or restricting a “new” chemical that has long been in commerce, he said.

Chemical users also want sufficient time to find useful substitutes for the chlorinated paraffins, he noted.

Critical conversations that should result from the agency's actions include a discussion of the scope of any ban or restriction the EPA may pursue, and a discussion of how much time companies will have to use existing stocks of the chemicals that already have been produced, Boucher said.

The agency could set different deadlines to phase out different uses of the chemicals.

Trend for Chemical Users

This rulemaking illustrates an important lesson about the role chemical users should play if Congress revises TSCA or the law continues to be implemented with the vigor seen in recent years, Boucher said.

“You can't leave it to the manufacturers and importers to defend the uses of your chemicals,” he said.

Everybody up and down the supply chain needs to participate in TSCA's implementation, Boucher concluded.

To contact the reporter on this story: Pat Rizzuto in Washington at prizzuto@bna.com

To contact the editor responsible for this story: Larry Pearl at lpearl@bna.com

For More Information

EPA's notice, risk assessments and comments submitted to the agency are available under Docket ID No. EPA-HQ-OPPT-2015-0789, which is available at http://www.regulations.gov .