Fragrance Notes Issue 3, 2018 - Page 28

DEVELOPMENTS Developments Tariffs Fragrance Creators Association successfully protected dozens of fragrance- related tariff headings from the final List 3 of the Trump Administration’s China 301 tariffs, a significant win for its member companies. Over the past 20 months, the Trump Administration has shifted from the U.S.-led push for global trade liberalization to a narrower focus that recasts trade policy to secure benefits for U.S. jobs, workers, and companies. The fragrance industry is impacted by a range of these developments, and nowhere is that exposure more evident than in the rapid escalation in the newly implemented U.S. tariffs (e.g., Section 301 and 232) and global retaliation (e.g., China’s retaliatory lists). Understanding the critical impact on the industry, Fragrance Creators took decisive action, establishing an ad hoc working group with government affairs and regulatory/purchasing experts from our local and global member companies to respond to the influx of trade activity. Through this Ad Hoc Tariff Working Group, Fragrance Creators identified materials subject to 301 tariff activity and submitted comments to the United States Trade Representative (USTR), urging the removal of fragrance ingredients from the list. The final List 3 tariffs were announced September 17, 2018. President Trump announced that the new tariffs took effect on September 24, 2018. They began at 10 percent and increase to 25 percent on January 1, 2019. TSCA Modernization As a direct result of its efforts to actively engage with the Environmental Protection Agency (EPA), Fragrance Creators has seen advancements in EPA’s willingness to incorporate feedback and find solutions for improving the new chemicals program. The Frank R. Lautenberg Chemical Safety for the 21st Century Act represents the first significant amendments of the Toxic Substances Control Act (TSCA), which is the primary chemicals management (chemical control) law in the U.S. Much of the focus of the legislation is on prioritization and evaluation of existing chemicals, or those already listed on the TSCA Inventory. Fragrance Creators was successful in 28 | FRAGRANCENOTES.ORG | Issue 3, 2018 utilizing multiple educational meetings and correspondence with EPA senior staff to focus EPA’s awareness on the issues and implications of the new chemical program. Fragrance Creators was successful in elevating fragrance as a priority industry for EPA new chemical approvals and will continue advocating for its members with pending submissions. After Fragrance Creators elevated the issue at its 2018 Lobby Day, Congressional House and Senate Members encouraged Acting Administrator Wheeler to improve the agency’s review of new chemicals. The fragrance industry’s priority is to ensure that TSCA modernization—in accordance with congressional intent and industry support—promotes safety, innovation, and sound science. The U.S. EPA issued a final-fees rule under the Toxic Substances Control Act (TSCA) on September 28, 2018. Volatile Organic Compounds (VOCs) The Consumer Products Regulation approved by the Air Resource Board (CARB) in California, sets Volatile Organic Compounds (VOCs) limits for numerous product categories. VOC limits do not apply to fragrances up to a combined level of 2 percent by weight contained in any consumer product. Over the past several months, multiple regulatory bodies have taken steps that may affect the regulation of VOCs. These regulatory bodies include CARB; the Ozone Transport Commission (OTC), (whose model rule is implemented in over 15 states in the U.S.); and Environment and Climate Change Canada (ECCC). In May 2018, OTC acknowledged that there were unintentional omissions in its model rule, which approximately 15 states follow, and welcomed Fragrance Creators’ comments highlighting the omission. The previous draft Phase V Model Rule, as published, did not include the CARB (VOC) exemptions for personal fragranced products. Fragrance Creators acted quickly, identifying the omission and informing, rallying, and leading engagement of allied trade associations and was ultimately successful in correcting this serious omission. Fragrance Creators will distribute an updated draft rule as soon as it becomes available. Fragrance Creators recognizes the importance of protecting the fragrance VOC exemption and, in conjunction with our allied trades, is providing policymakers with the necessary information to make well- informed decisions. CA SB 1249, The California Cruelty-Free Animal Cosmetics Act On August 31, 2018, the California Legislature passed SB 1249, a bill which bans cosmetics from being sold in California if those products or their ingredients have been tested on animals, specifically vertebrates. The bill allows for particular exemptions, including mandated testing. Working closely with the Personal Care Products Council, Fragrance Creators was actively engaged with stakeholders in California during the drafting process to ensure that the bill better aligned with existing laws and included key exemptions. The bill was signed into law by Governor Brown on September 28, 2018, and will become operative on January 1, 2020. NYS DEC On June 6, 2018, the New York State Department of Environmental Conservation (NYS DEC) finalized its Household Cleansing Product Information Disclosure Program Certification Form and Guidance Document. Claiming to act on existing statutory authority, this regulatory action requires manufacturers to disclose cleaning product ingredient information online. The implementation timeline is tiered, with disclosure for intentionally added ingredients beginning in July 2019 and certain nonfunctional byproducts and contaminants in January 2023. Fragrance Creators has been heavily involved with this issue since the document’s initial release and is developing a multi-faceted strategy with our allied trades to address the guidance. WHMIS 2015 Through the expertise of its Occupational