• EPA to Require Up-Front Substantiation of All Non-Exempt CBI Claims
  • February 20, 2017 | Authors: Thomas C. Berger; Herbert Estreicher; Eric P. Gotting; David G. Sarvadi; Adrienne M. Timmel
  • Law Firms: Keller and Heckman LLP - Indianapolis Office; Keller and Heckman LLP - Brussels Office; Keller and Heckman LLP - Washington Office
  • The U.S. Environmental Protection Agency (EPA) has published its first guidance document in the Federal Register interpreting the new substantiation requirements for confidential business information (CBI) claims submitted under section 14 of the Toxic Substances Control Act (TSCA) (15 U.S.C. § 2601 et seq.). The Agency is changing its approach to implementing the new substantiation requirements. Rather than issuing substantiation requests for 25% of all non-chemical identity CBI claims received by EPA, beginning March 20, 2017 EPA will require up-front substantiation of all such claims. That is, companies must provide substantiation for all non-exempt chemical identity and non-chemical identity CBI claims at the time they submit such claims. EPA has yet to issue interpretive guidance on the scope of the exemptions from substantiation, which appear at section 14(c)(2) of TSCA, or how to invoke these exemptions in submissions to the Agency.

    As to what is required to substantiate CBI claims for which there are no existing TSCA requirements, EPA suggests that companies provide answers to the questions listed in the Agency-wide, general CBI regulations at 40 C.F.R. § 2.204(e).

    Existing EPA confidentiality rules at 40 CFR part 2, section 2.204(e) provide substantiation questions that the Agency may specifically request answers to, pursuant to the procedures in those regulations. While those specific questions are not dictated by the self-executing substantiation requirement in TSCA section 14(c)(3), EPA suggests that companies look to those questions for guidance as to how to fulfill the TSCA section 14(c)(3) substantiation requirement for information that is not currently subject to an existing regulatory up-front substantiation requirement. . . .

    For information that is currently subject to a regulatory up-front substantiation requirement (for example, chemical identity CBI claims in the Chemical Data Reporting rule, under 40 CFR 711.30), the terms of that requirement, including the substantiation questions required, will continue to govern the substantiation.


    Since TSCA amendments took effect last June, EPA had been issuing letters requesting companies to provide answers to 11 detailed questions, and 15 detailed questions for health and safety information, for purposes of substantiation. By contrast, section 2.204(e)(4) asks only the following nine questions:

    (i) The portions of the information which are alleged to be entitled to confidential treatment;

    (ii) The period of time for which confidential treatment is desired by the business (e.g., until a certain date, until the occurrence of a specified event, or permanently);

    (iii) The purpose for which the information was furnished to EPA and the approximate date of submission, if known;

    (iv) Whether a business confidentiality claim accompanied the information when it was received by EPA;

    (v) Measures taken by the business to guard against undesired disclosure of the information to others;

    (vi) The extent to which the information has been disclosed to others, and the precautions taken in connection therewith;

    (vii) Pertinent confidentiality determinations, if any, by EPA or other Federal agencies, and a copy of any such determination, or reference to it, if available;

    (viii) Whether the business asserts that disclosure of the information would be likely to result in substantial harmful effects on the business' competitive position, and if so, what those harmful effects would be, why they should be viewed as substantial, and an explanation of the causal relationship between disclosure and such harmful effects; and

    (ix) Whether the business asserts that the information is voluntarily submitted information as defined in §2.201(i), and if so, whether and why disclosure of the information would tend to lessen the availability to EPA of similar information in the future.


    These are less specific than the 11 to 15 questions EPA had been posing to CBI claimants immediately following enactment of the Lautenberg Chemical Safety for the 21st Century Act, and it is unclear at this time what criteria EPA will apply in reviewing these claims. Although there is longstanding jurisprudence on what constitutes confidential business information generally, whether information is subject to CBI treatment under TSCA, specifically, has not been the subject of extensive litigation.

    For CBI claims made between June 22, 2016 and the effective date of this guidance, companies will need to provide substantiation unless the claims were already substantiated or are exempt from substantiation. Such submitters will have 240 days from March 20, 2017 to submit this substantiation. If no substantiation is provided, then EPA will notify the company that it has 30 days to submit substantiation or EPA will deem its CBI claims to have been waived.

    EPA is not officially seeking comments on this guidance, but it has established a public docket for it (Docket ID No. EPA-HQ-OPPT-2017-0026). Technically, interpretive guidance is not subject to notice and comment rulemaking under the Administrative Procedure Act unless a court finds that it is actually a legislative rule that creates at new duty (rather than clarifying the scope of a duty), which EPA disguised as guidance. On the other hand, because the CBI notice is simply guidance, the new Administration could, in theory, easily rescind it. This is true particularly in light of the U.S. Supreme Court's decision in Perez v. Mortgage Bankers Ass'n, 575 U.S. ---, 135 S. Ct. 1199 (2015), holding that an agency's interpretive guidance may be changed without notice and comment rulemaking under the APA.

    The CBI guidance was signed by the departing Assistant Administrator of EPA's Office of Chemical Safety and Pollution Prevention, Mr. Jim Jones, and dated January 13, 2017.