CPSIA – Rumorville on 15 Month Rule

Hope you haven’t assumed that the “15 Month Rule” has gone away.

CPSIA – Unpublished Article Highlights CPSIA Benefits Felt by Testing Companies

Intertek Presses Toy Rules as U.S. Scrutiny Aids Testing Firms

2011-02-02 05:00:02.1 GMT

By Mark Drajem

Feb. 2 (Bloomberg) — When the U.S. Consumer Product Safety Commission last May proposed rules on how toymakers must test their products, Toys R Us Inc., Lego A/S and retail groups urged
the regulators to ease off.

One company took a different tack.

London-based Intertek Group Plc, the world’s largest consumer-goods testing company, argued that the rules should be expanded to require manufacturers to submit to further “engineering, chemical and biological analysis,” to ensure that the design of any toy is safe.

The filing demonstrates one consequence of increased government scrutiny of product safety: For Intertek and other testing companies such as Bureau Veritas SA and SGS SA the very rules that manufacturers and retailers say burden them with undue costs and paperwork mean more business.

“It’s just another opportunity to test,” said Larry Lynn, compliance manager at Learning Resources Inc., a Vernon Hills, Illinois-based maker of educational toys such as the Zoomy handheld microscope. The company estimates its testing costs jumped 10-fold since 2006.

“All the labs have seen a significant increase in the business because of the requirements of the CPSC,” said Rick Locker, a lawyer for the Toy Industry Association in New York. In the first months after a previous law went into effect in 2009, testing costs tripled, he said. While the expenses and
delays have receded, pending new requirements mean “you could see that issue come back again,” he said in an interview.

Back to Edison

Intertek, which traces its corporate heritage to Thomas Edison’s Lamp Testing Bureau, has more than 1,000 labs in 100 countries. In addition to analyzing consumer products such as apparel and toys, it tests or certifies chemicals, foods and minerals. It earned 103.7 million pounds ($167.3 million) on revenue of 652.6 million pounds in the first half of 2010, its most recent published results.

The U.S. testing requirements followed a rash of recalls in 2007 of Chinese-made toys, sold by companies such as Mattel Inc., which were found to contain lead paint. In response, Congress passed legislation in 2008 mandating that all toymakers curb lead and other harmful materials in their products and redouble testing.

While the rules apply to toys sold in the U.S., much of the testing takes place in China and Hong Kong, where many U.S. toys are made. The U.S. imported $25 billion in toys from China in 2009, making it the third-largest category of imports from the country, behind computers and household goods such as clocks.

European Testers

The largest consumer-testing companies are based in Europe. Among the bigger ones in the U.S. are Northbrook, Illinois-based Underwriters Laboratories Inc. and Consumer Testing Laboratories
Inc. in Bentonville, Arkansas. Both are closely held.

Intertek, Bureau Veritas and SGS, the world’s three largest testing companies, all say their revenue jumped after the new toy requirements began in January 2009. Intertek’s revenue from consumer-goods testing in the first six months of that year climbed more than 20 percent, almost double the overall company revenue growth, to 162.5 million pounds.

Its profit margin in consumer products was 33 percent, double that of the company as a whole. Intertek has more than doubled in London trading since the U.S. law took effect, and has risen 45 percent in the past 12 months.

Both Bureau Veritas, based in Neuilly-sur-Seine near Paris, and Geneva-based SGS are bigger than Intertek in revenue from all testing. Bureau Veritas shares have increased 54 percent in the last year. SGS, the world’s biggest overall product inspector, is up 15 percent.

Growth Ahead

While Intertek’s consumer-testing revenue fell 0.4 percent to 161.9 million pounds in the first half of 2010, the company predicts a U.S. requirement that a government-certified, outside testing company examine each children’s product will boost profits again over the next two years.

The new U.S. rule, as well as a European Union initiative in toy safety, “present further opportunities for growth in 2011 and 2012,” the company said in a presentation to investors in August. The Consumer Product Safety Commission voted yesterday to delay the next round of testing requirements until 2012 from later this year as initially planned.

Anticipating an increased need for testing, Intertek has introduced computer software for sale to manufacturers so they can meet the analytical and paperwork requirements the consumer-safety agency is scheduled to implement.

Intertek also is making sure its voice is heard in Washington. It hired former CPSC chief of staff Joseph Mohorovic as a vice president, and paid the firm of former CPSC chairman Hal Stratton $240,000 last year to lobby on its behalf, according to government records.

No Regrets

Gene Rider, president of Oak Brook, Illinois-based Intertek Consumer Goods in North America, said a combination of increased consumer awareness and growing global outsourcing is sparking
demand for Intertek’s testing services.

“One of the misconceptions is that regulation drives our revenues,” Rider said in an interview. “All the rules are asking manufacturers to do is to demonstrate good manufacturing practice.”

As for its petition to the CPSC, Rider said he has no regrets. Most recalls are caused by design flaws, not faulty materials such as lead paint, and those won’t be found without new government requirements, he said.

“It’s all about designing the product to avoid injuries or fatalities,” Rider said.

To contact the reporters on this story: Mark Drajem in Washington at +1-202-624-1964 or mdrajem@bloomberg.net.

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CPSIA – Unpublished Article Highlights CPSIA Benefits Felt by Testing Companies

CPSIA – CPSC’s Shameful Failure of Leadership

On Monday, the CPSC will decide whether or not to extend the testing and certification stay that has been in place for two years. The 16-page document which sets out the parameters of the decision does not mention risk anywhere. That’s because the law prohibits the CPSC from considering safety in its work under the CPSIA. [Ironically, the CPSC warns users that use of its www.SaferProducts.gov website is at their own risk (see par. no. 2 in the user's agreement) - and ironically, we're talking about a "dot gov" website, too!]

The CPSC explains that extension of the stay is only one of its options. It can do nothing, it can roll all the existing stays forward, or just some of them (to heck with the ATV’rs and the bike industry). Presumably, they will choose to roll all of it forward to September 14, 2011. We can all be screwed on the same day. I like the symmetry of that!

The CPSC has not lost sight of the issues. They know they haven’t finished their work. They note that two years ago on February 9. 2009 when the Commission first extended the testing stay. it was because delaying implementation of the testing requirement by a year “give[s] us the time needed to develop sound rules and requirements as well as implement outreach efforts to explain these [new] requirements of the CPSIA and their applicability.”

How time flies! That didn’t happen, so the Commission again extended the stay by another year on December 8, 2010. Why? Chairman Tenenbaum: “I voted to extend the stay on lead content testing and certification until February 10, 2011, in order to allow component testing adequate time to develop and to give our stakeholders adequate notice of new requirements.” Commissioner Robert Adler: “One of the primary rationales advanced for extending the stay is to await the effective date of the so-called 15-month rule.”

Where does the time go?? None of that ever happened. Hey, CPSC, take all the time you need!

So now the Commission is poised to kick the can down the road until September 14, 2011. Why that date? The CPSC Staff report notes that this gives the Commission time to sort out the new, lower lead standard due to be imposed on August 10, 2011. The CPSC is holding a hearing on February 14 on the feasibility of the 100 ppm standard. As Staff notes, if the Commission doesn’t determine that 100 ppm is feasible, then they will have to set a standard between 300 ppm and 100 ppm that is feasible. “Feasibility” was defined in the CPSIA, lest there should be any disagreement, to exclude ANY consideration of economics. In other words, if it’s possible at any price or under any condition, it is considered “feasible” and thus mandated by the law. I can save the CPSC some time – under that definition, it’s definitely feasible. Completely unreasonable and unnecessary but “feasible”.

The idea promoted in the Staff memo is that we will time to get used to all this if the stay lifts a month after the implementation of the new lead standard. [The concept of "learning disability" floats through my head. Have we heard this song before?] “Staff recommends that the Commission extend the stay to allow time for the Commission to determine whether it is technologically feasible to lower the amount of lead in children’s products to 100 ppm.” I guess once the Commission makes up its collective mind, the CPSC will wave a magic wand and make your business, your supply chain and your sales channel comply with the new rules in a matter of days. The fact that the rules are hazy after almost three years is no concern of theirs. Is it a concern of yours?

I love magical rules and magical plans! It must be a job requirement for Commissioners to be wizards, too.

All concerns over the “15 Month Rule” seem to have evaporated. This is presumably Robert Adler’s doing (see his statement above, which is a rant that the 15 Month Rule and the stay are separable issues). The Staff report intones: “While a Commission decision to extend the current stay of enforcement will give industry an opportunity to test and certify finished products and components according to the final rule and provide the Commission time to clarify any confusion regarding the new rule, it is not necessary for the testing rule to be complete to lift the stay as to the initial test for lead compliance.” Can’t see any problem there, can you???

The CPSC doesn’t want you to worry, however. They have apparently promulgated several documents that set out their policy and whatnot on lead, namely “Statement of Commission Enforcement Policy on Section 101 Lead Limits” (February 6, 2009) (6 pages); “Children’s Products Containing Lead: Interpretative Rule on Inaccessible Component Parts” (August 7, 2009)(32 pages); “Statement of Policy: Testing and Certification of Lead Content in Children’s Products” (October 2009)(5 pages); and “Interim Enforcement Policy on Component Testing and Certification of Children’s Products and Other Consumer Products to the August 14,2009 Lead Limits” (December 28, 2009) (4 pages). If these four documents totalling 47 pages don’t clear up everything, the CPSC is ready for you. “Manufacturers of children’s products can seek guidance for what the Commission considers reasonable and representative testing in these rules.”

You may have to wait a few years for a reply, but darn it, they’re going to answer your question. And that’s because they really CARE. We’re the government and we’re here to help!

A few more cock-ups aren’t deterring the agency. The phthalates standard is still undrafted, likewise the certification procedures for phthalate testing labs. Oopsie! Well, they’ve been busy . . . and the much fantasized-over component testing “market” has failed to materialize. Imagine that, businesses that inadvertently serve the children’s market with components or which derive a small percentage of sales from children’s products aren’t volunteering to test their items and expose themselves to the ravages of a crazy and out-of-control federal agency. Shocking!

Those of you who live in the past may recall my mentioning this very issue on November 6, 2008 (yes, 2008) when I addressed the CPSC Lead Panel. [It's a safe assumption no one was listening at the agency - opportunities for stakeholder feedback is not for listening, it's for venting.] I talked about the futility of expecting our suppliers of aluminum foil (widely used in schools in science kits) to test their products. After all, they are allowed to sell it for use with food without testing, so why should they test for me? If I asked them for a test for compliance with the CPSIA, they would certainly refuse and then ask in outrage why I was selling aluminum foil to kids anyway. As I said, who could see this coming? No one . . . .

For all the outrages that this sick situation brings to mind, NOTHING is as shameful as the CPSC’s refusal to admit that this is all administrative, bureaucratic nonsense (or use your own word for “nonsense”) that has nothing to do with SAFETY. Oh yeah, safety – isn’t that word in the name of this agency – the Consumer Product SAFETY Commission. What about safety, guys? Are you concerned about that anymore? This failure of leadership is the basic issue I have with the folks running the agency today. There’s a reason that bureaucrats are called “soul-less”.

The fact is that this administration at the CPSC (Democrats) will not stand up for what’s right – they are prepared to go down with the ship. It’s ironic that they remain so strident and so stubborn. Mr. Obama can smell change in the air and even he has called for reconsideration of the deluge of regulations. The Republicans in the House have declared war on over-regulations and the House Energy and Commerce Committee has made reform of the CPSIA the top priority of Mary Bono-Mack’s subcommittee.

As I have said again and again – this is YOUR government at work. Their shameful acts which are harming your markets and your business are destroying jobs, discouraging innovation and hurting children by impairing the activities of businesses devoted to children’s welfare. This intolerable situation will only be fixed when you MAKE it change. You can do it and you must. There is a new Congress in town and they need to hear from you. Don’t let the Democrats keep on wrecking your industry. This isn’t about safety and never was. This is politics, pure and simple.

Make them pay for their sins. Call your Congressman.

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CPSIA – CPSC’s Shameful Failure of Leadership

CPSIA – The Worm Continues To Turn

The day we all feared, the day we knew would come someday . . . well, the Federal Register says it’s coming soon. According to a notice of “Final Rule Stage” published on December 20, the CPSC is moving forward on the so-called “15 Month” Rule.

You have to chuckle at the “15 Months” part. This rule was legally mandated to be enacted 15 months after the CPSIA was signed into law. The presumed date of enactment would then have been November 14, 2009, a mere 14 months ago now. They didn’t even published a first draft until May 2010. If the agency can somehow finish this project by January 14, it could be called the “15 Months Times Two” Rule. Then again, it’s basically inconceivable that they will make it. Eventually they’ll need another name for this thing.

The urgency behind finishing up this rule is that the testing and certification stay expires on February 10, 2011. Remember that Bob Adler already said he wouldn’t vote an extension of this stay because . . . he hates stays. Perhaps he prefers market chaos and economic depression instead. Anyhow, to avoid the showdown, they need to get their ducks in a row, hence the need to get this rule going.

I sent in comments on the first draft of this rule on August 3. I wasn’t a big fan . . . and I guess other people had reservations, too. According to www.regulations.gov, the CPSC received 112 comments letters (that may overstate the number, because regulations.gov seems to have some duplicates). I haven’t read them myself, but I assume I am the only one who saw any flaws in this rule. The rest of the letters are probably just “thank you” notes.

Anyhow, it’s worth noting that the Chinese New Year occurs on February 3, 2011 so take my word for it, all the Chinese factories will be closed on Feb. 3rd and probably won’t reopen until Feb. 10 at the earliest after a two-week holiday. Some workers are gone three or even four weeks for this holiday. In a “best case” scenario, the CPSC can’t take action on this rule until they officially acknowledge the public comment “thank you” notes and hold a public Commission meeting. Do the math – if they choose to take action on this rule now, we will get about ten minutes notice to begin conforming. I can’t see any risk of market chaos again . . . can you?

Here’s a fairly obvious fact for you – we have not incorporated any of the pending rules into our supply chain or manufacturing processes. Why? You tell me what I’m supposed to do. The rule that has been published is deeply flawed and, basically, stupid. It is not a final rule. 112 comment letters were filed on it. It could change . . . it BETTER change. How am I supposed to implement rules that haven’t been published or possibly even written? Telepathy? I don’t read minds and I haven’t implemented the unknowable, either.

If this does not make your blood boil enough, consider these excerpts from the notice of Final Rule Stage:

• “The U.S. Consumer Product Safety Commission is charged with protecting the public from unreasonable risks of death and injury associated with consumer products.” [Emphasis added] The CPSIA makes consideration of RISK by the CPSC illegal. Bummer, huh? Someone should have told the CPSC because they still claim to be concerned with “risk” of injury.
• “When deciding which of these approaches to take in any specific case, the Commission gathers and analyzes the best available data about the nature and extent of the risk presented by the product.” And then ignores it??? See also the final bullet below.
• “As for exemptions [from the "15 Month Rule"], the statute does not appear to give the Commission the authority to exempt firms from the testing or certification requirements, so it may not be possible to exempt firms within section 14 of the CPSA.” In other words, HTA, you can lump it. And the CPSC is telling you who to blame – Congress.
• “The congressional mandate to issue this regulation does not require the Consumer Product Safety Commission to do a cost/benefit analysis for this regulation. Therefore, a cost/benefit analysis is not available for this regulatory action.” Head-in-sand syndrome. I bet you’ll be able to do a cost/benefit analysis pretty quickly when your costs go up again by 20x.
• “[It] is not possible to provide an analysis of the magnitude of the risk this regulatory action addresses.” Ahem. And it’s okay to put forward a rule of this complexity and far-reaching impact while flying entirely blind because . . . why???

Let’s not forget that there’s a new Congress being sworn in January 5th. The incoming Republican House majority has pledged to shrink the federal government and to closely examine how regulatory agencies are governing. Hmmm. Help may be on the way . . . soon.

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CPSIA – The Worm Continues To Turn

CPSIA – TIA’s Toy Safety Certification Program Quietly Dies

TIA Members, please sit down before reading on.

Over the past three years, the Toy Industry Association famously invested millions of dollars in members’ dues in something called the “Toy Safety Certification Program” (TSCP). When I say “millions”, I mean it. On October 14, 2009, TIA outside counsel Rick Locker referred to “$2 million of technology” available to the industry via the TSCP website. He was referring to the cost of the program to date, roughly. The program began in August 2007 – that’s about $1 million per year.

The TSCP recently died a natural death, mercifully. See Carter Keithley’s September 7th release on this topic. I figure the program cost NO LESS THAN $3 million of TIA members’ money, perhaps more, with NO return on investment. A TOTAL loss. Ouch. Don’t expect any heads to roll.

The TSCP was a terrible idea from the get-go. For one thing, the TSCP was a business and the TIA should have NEVER tried to go into business in competition with its members, if only for the reason that real businesses beat dilettantes every time. I believe the business plan for the TSCP was fantastic, if it existed at all in any formal sense. No rational business person would have EVER made such a reckless investment but then again, it wasn’t their money. . . so the bet apparently seemed “reasonable” to the decision-makers.

The basic concept underlying this massive bet with other people’s money was that if the TSCP cracked down on its own members harshly enough, the CPSC might back off and let the industry police itself. The horrific historical analogs must not have occurred to anyone, nor their tragic ends.

The idea of the TSCP was flawed in several critical respects. First of all, the issues that spawned the CPSC had little to do with the standards – the problem was compliance. A program like the TSCP would hardly snare those who were indifferent to compliance – it was VOLUNTARY. Second, the theory required that the TIA be so harsh that the CPSC would let the TIA take over. Of course, this made the TSCP a rather unappetizing vehicle for most of us. And it was VOLUNTARY. We never considered participating.

Worst of all, the TSCP grossly favored the mass market companies in the toy industry. This could not have been a shock to anyone as the authors of the program were largely mass market toy people. I documented this in my October 18, 2009 blogpost entitled “The TIA Just Wants to HELP You!“. The program was going to kill all but a few of us, but that didn’t stop the TIA.

What ultimately stopped the TIA was a lack of business. Apparently, we weren’t alone in disregarding the multi-million dollar investment of our industry organization. Rumor has it that certain large companies committed to using the program but then backed away when it became clear that no one was joining them in this fun. No one likes a competitive disadvantage, apparently. Who’da thunk it?

And the legacy of the TSCP? The TSCP did such a great job of outlining a horrific testing scheme that the CPSC used critical elements of it as a starting place for their “15 Month Rule”. You can trace the harshness of the TSCP through to the pending rule on testing frequency and “reasonable” testing programs. Yes, the TIA provided this leadership – after all, if it’s good enough for the TIA, how could the industry complain?

How, indeed. Pass the barf bag, please.

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CPSIA – TIA’s Toy Safety Certification Program Quietly Dies

CPSIA – Stories from the Front (My "Vivid" Imagination)

783 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 27 days left until Election Day.

Have I ever mentioned how the CPSIA is strangling us to death slowly, death by a thousand cuts? I know the media and the “leaders” at the CPSC want me to put up bodies, my word and my reasoning are not enough. I also realize the body they want to see most of all is mine. Sorry, guys, I am working to prevent the delivery of that evidence to you. After all, anecdotes aren’t evidence. Somebody said that once . . . .

How about some other evidence (anecdotes) from our business in recent days?

a. Good news for the U.S. economy? We just added our SIXTH person to our growing department of compliance and safety folks. Please NOTE that the volume of work is going to EXPLODE when the testing stay is lifted, so these hires are just a starter. For many years, it was one or two people doing this job (including me). No longer . . . .

I know what you’re thinking, this obviously confirms how much we needed the extra safety people. In addition, it follows naturally that everyone is so, so, SOOOO much safer now that we have six pairs of eyes on the ball, not the one or two pairs we relied on for years. And those are jobs being created by Congress and the CPSIA – we must be so much better off . . . right?

Well, let’s take a look at those points.

First, are we adding jobs? No. The department is clearly growing, BUT those jobs do not create revenue. They create COSTS. We are adding those jobs without increasing new economic activity (we’re not growing) – in other words, our burden to conduct the same or less business is growing. That’s simply a drain. Even WORSE, as a company, it turns out we shrunk our headcount in 2007, 2008, 2009 AND 2010. So much for a recovery . . . . If we are shrinking our headcount this year but have a growth department like Compliance, what does that mean? It means that we are reducing our investment in revenue-generating activities like Marketing and Sales, and shifting our personnel investment into managing bureaucracy. To pay the cost of paper pushing, we are shrinking overall headcount.

What-a-stimulus-plan!

As for safety, we achieved a remarkable 26-year track record with far less investment and far fewer people. I firmly believe that more cooks in the kitchen sharply raise the probability of poorer results. Yes, more is NOT better. Why? Because the focus on our efforts is now COMPLIANCE, not safety. [We still work on safety first but it has a lot more competition from paper pushing.] Compliance monitoring and “gotchas” have become a perverse parlor game. Consider Sean Oberle’s recent meditation on Mood Rings. The subject of whether the rings are SAFE never comes up, it’s all about whether they fall within the rules or not. Safety is secondary in the CPSIA scheme – and everyone is losing sight of what we’re trying to accomplish. Paper stacked to the rafters won’t make anyone safer but then again, it’s comforting to have so many rules to follow.

Do I recall correctly that Mattel with its many CPSC-certified internal labs just recalled about 11 million units of toys? Hmmm.

b. Profit Prevention in Full Bloom at Learning Resources. We had two lessons in the joys of safety compliance money-burning in recent days. Consider these stories and their implications on incentive, motivation, ability to fund our operations, fairness and most importantly, safety.

First Case: We sold a longstanding product incorporating a motor to a mass market retailer with its own testing regime. Their testing regime includes CPSIA tests and is administered according to their specifications by a certified test lab of their choosing. The motor for that item was tested and failed for phthalates. We don’t know why – it has been made reliably without the six verboten phthalates since 2007 (many passed tests in our files). So we pulled a second sample from the same batch, and bingo, it passes. This happens all the time.

Of course, certified labs are never wrong. We are the only ones who are ever wrong. After all, the certified labs are CERTIFIED. No doubt that’s how Mattel keeps its shop so clean. Oops, they had some big recalls recently, didn’t they? I am confused . . . .

Anyhow, back to my story. Motor fails for phthalates and then passes. [Let's not dither over whether phthalates on internal components could even THEORETICALLY harm anyone. It's all about compliance.] Unfortunately for us, this nonsense took two weeks. So the customer penalized us by making the sale a guaranteed sale. If they don’t sell out, we lose.

Total cost – unknown. Was any of this cost budgeted for? Of course not. Is our customer happy? No. Could we control against this risk? Probably not, as the explanation of the “failed” test is not and never will be known. We are not making pharmaceuticals here, we make injection molded toys, but we are being held responsible for chemistry and testing results that have no real world significance.

And, it is worth mentioning, all this cost and disruption had NO impact on safety. It only reduced our profit and made us miserable.

Second Case: Another motor case. In the mania over safety and compliance, many formerly minor “gotcha’s” have become elevated in signficance. This time, we were trying to mollify a customer over EMC approval of a motor. Electrical motors emit a frequency, apparently, which is regulated. You know, the government doesn’t want our motor-powered toy to bring down a plane. We are required to test several of our products, sometimes even calculators. In this case, the motor failed . . . although we have no record of planes crashing after several years of sales of this toy and its motor. Our customer then hired a consultant at its expense to tell us how to “fix” our motor. The result – we were told to add two resistors to the motor, which we did, but then it was too weak to power our toy.

Then we had to find another motor. This took time and finally, we found another motor and had to have it retested. This entire process took two months. Once testing was complete, we were so late with this Xmas order that we were forced to bring in inventory by air freight to make it up to the customer. This cost about $15,000 in air freight and testing costs were an estimated $5-6,000 more. Think of how safe the planes are now!

This customer is a big customer of ours and if we didn’t air in product for them, they told us they would have cut us off.

We had a great relationship with the customer before this interaction. How do you think they feel about us now? Do you think they respect us as much? Do you think they believe we “know what we’re doing” because our motor failed an obscure and meaningless test? Does it matter that it is basically impossible for a terrestrial toy of this magnitude to influence the operation of a plane miles up in the air? No matter what, we look bad and we lost all of our profit and more on this ordeal, not to mention our good name.

And no one was made safer.

Thanks Congress! Thanks CPSC! Thanks Democrats! Can’t wait to show my appreciation in the future. I’ll find a way.

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CPSIA – Stories from the Front (My "Vivid" Imagination)

CPSIA – It’s Raining Paper . . . Again

At the April 29th CPSIA hearing, I testified that the CPSIA and associated rulemaking had exploded into more than 2500 pages in new CPSIA laws, rules and documents that pertain to my business. I also noted that 608 pages had been issued in the 30 days preceding the hearing and that the rulemaking process continues unabated. Well, the CPSC just spewed out another ream of paper (396 pages) for you to absorb this week:

1. Publicly Available Consumer Product Safety Information Database, Notice of Proposed Rulemaking, DRAFT Federal Register Notice, May 7, 2010. [150 pages]
2. Testing and Labeling Pertaining to Product Certification, Notice of Proposed Rulemaking, DRAFT Federal Register Notice, May 7, 2010. [164 pages]
3. Conditions and Requirements for Testing Component Parts of Consumer Products, Notice of Proposed Rulemaking, DRAFT Federal Register Notice, May 7, 2010. [82 pages]

At a mere 396 pages, this week’s new rules increases the total paper released in the last 45 days to at least 1,004 pages. In its usual helpful fashion, the agency issued these rules to replace other documents recently released and that you may have already read. Gotta read these pupies from the top, since they aren’t redlined against prior drafts. This doubles the fun of the new rules – you need to master them to run your business PLUS you get to go on an exciting treasure hunt as you try to figure out what has changed! And we get all that fun for free!

Good thing time grows on trees or else I might get frustrated.

Happy reading! Just remember, if you don’t comment on these rules and the CPSC imposes final rules that are unreasonable or crush your business, you will have no one to blame but yourself.

As I said, happy reading!

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CPSIA – It’s Raining Paper . . . Again

CPSIA – But Who Will Test the Test Lab Testing Testers???

Demonstrating that creative, innovative flair we look for in our regulatory agencies, the CPSC has just announced its discovery of a much-needed new testing protocol, the test lab testing tester. Okay, so you say someone’s been playing with their clacker balls a bit too much, but heck, they gotta know what they’re doing, right?

Embedded deep in the impressively long 160-pager entitled “Proposed Rule: Testing and Labeling Pertaining to Product Certification, April 1, 2010“, the CPSC reveals that there’s trouble in La-La-Land over variances between lab tests performed at different certified labs: “Another comment noted that variations in sample preparation by conformity assessment bodies can and do lead to differing test results. One comment, noting lab-to-lab variations in test results for the same product, suggested that CPSC should require CPSC-recognized third party conformity assessment bodies to conduct blind correlation studies and lab audits.”

Oy vey, what do people EXPECT? The CPSC can’t help out on every niggling problem: “The Commission’s limited resources preclude CPSC from directly conducting verification of the numerous CPSC recognized conformity assessment bodies. Additionally, the activities and requirements for accrediting conformity assessment bodies are outside the scope of this rulemaking.”

Case closed?

Au contraire, Pierre! This CPSC will face down every challenge! They ain’t no teething tiger any more, they are a Lion of Safety now, so they came up with the perfect rule to resolve this dilemma. After all, lest we forget, you CAN’T be too safe! Here’s what they came up with:

“Proposed § 1107.24(a) would state that a manufacturer is responsible for verifying that its children’s products, as tested by a third party conformity assessment body, comply with applicable children’s product safety rules. For purposes of proposed § 1107.24, “verification” would mean testing that demonstrates that the test results from one third party conformity assessment body are consistent with the test results from another third party conformity assessment body for a particular children’s product. Proposed § 1107.24(a) would require a manufacturer to send samples of a previously certified children’s product or a children’s product that previously has been tested periodically pursuant to proposed § 1107.21 to a third party conformity assessment body for verification.

. . . . Proposed § 1107.24(b) would require verification to occur on a reoccurring basis and be conducted at a frequent enough interval to provide a high degree of assurance that the children’s product that had been certified previously continues to comply with the applicable children’s product safety rules or that the periodic test for the children’s product was performed correctly.”

]Emphasis most enthusiastically added.]

This is GENIUS! Thank heavens we have the CPSC to protect us. Who else would have spotted this terrible and threatening gap in our consumer safety network? But having added this new layer of “protection”, aren’t other safety holes now visible? I call on the CPSC to bring out rules clarifying:

• Certification of testing testers;
• Certification of testing tester testing testers (you need those, too);
• Certification of testing tester testing certifiers;
• Rules for tolerable variances among testing labs for each certified test, record keeping on all test results and variances for at least 100 years, and plans of remediation for every conceivable variance for each possible test under all conceivable circumstances;
• Rules for a new agency to check all the work of the CPSC and to reconsider and rewrite every rule they have ever written, plus record keeping and hearings and comment periods for this new agency;

I think the new agency to check the work of the CPSC should be called the Consumer Product Safety Commission Checking Commission for Safety Enhancement and Verification Processes (CPSCCCSEVP), you know, for simplicity. Gotta keep it simple and efficient. That’s my motto!

[For more pleasure reading on this important topic, don't miss the 110-page Staff briefing or the equally riveting 29-page Slide Presentation for the April 15 Commission meeting on the same topic. Happy reading!]

Read more here:
CPSIA – But Who Will Test the Test Lab Testing Testers???

CPSIA – It’s Raining Paper . . . .

I have previously made the point (again and again) that the paperwork involved in complying or even understanding the CPSIA has escalated to absurd and previously unimaginable levels. When I recently posted my latest video blog, I noted that MY count of the pages of rules implementing the CPSIA was over 1800. [The CPSC has not promulgated a list of these documents and some of them may not even be publicly available, so that's just my count - no one knows the true number.]

Since then, the paper shower has continued unabated. Here are a few new shovel fulls from your CPSC:

Definition of “Children’s Products”: 52 pages

Standard Operating Procedure for Determination of Phthalates: 8 pages

Proposed Rule: Conditions and Requirements for Testing Component Parts of Consumer Products: 69 pages

Draft Notice of Proposed Rule -Publicly Available Consumer Product Safety Information Database: 172 pages

Proposed Rule: Testing and Labeling Pertaining to Product Certification: 160 pages

Staff Briefing Package CPSIA Certification & Testing, April 1, 2010: 110 pages

Total pages: 571

In addition, public meetings of the Commission on Wednesday morning and all day on Thursday this week will feature major topics of great importance to those companies affected by the CPSIA. These will be Must Watch hearings. Hope you aren’t too busy running your business to stop what you are doing and tune in all day.

There cannot be any rational expectation by the CPSC that businesses interested in the development of CPSIA implementation rules could POSSIBLY keep up with this torrent of paper and hearings. The impracticality of participating in this process means that it is a railroad job, plain and simple. It is intentional, too – overwhelming the regulated community is one way to silence the critics.

Despite the absence of any credible evidence that such a massive expansion in safety rules is justified by injury statistics or any form of safety data from marketplace, the CPSC is in the process of gleefully converting the safety rules governing children’s products into something approaching the Internal Revenue Code in complexity. The compliance burden on businesses will be overwhelming – or simply impossible in a practical sense. As important as Ms. Tenenbaum’s instant death rules are, running our operating businesses will take priority for most people.

With this inundation of complexity, the point of capitulation is upon us. Add to this the known risk of mega penalties. Remember, this CPSC has warned businesses not to dare resist it. The consequences of resistance can be interpolated from the Daiso penalty – $2.05 million for recalls of 698 pieces in five recalls of 19 products over two years without a single reported injury. [Imagine what Mattel or RC2 would pay today under this enforcement scheme. I wonder if my calculator has enough digits for that number . . . .] Ms. Tenenbaum has demonstrated that she will have no reluctance to sic the U.S. Attorney on us for our transgressions without regard to actual market impact, striving to impose “a very high hurdle to jump over to ever get back in the import business again”.

This approach to regulation is an irresponsible act by our government and very damaging to the market. It’s naive and shortsighted, but in the “Father Knows Best” world wrought by Mr. Obama, it’s useless to attempt to reason with the regulators. The promised “dialogue” with the regulated community has been exposed as a sham. It’s hard not to conclude that businesses have now been deemed evil by nature. Otherwise, how do you explain the paper blizzard? Sadly, none of this holds any prospect of making kids safer.

I hate the feeling of shouting in a vacuum. I am not sure what will trigger a revolt against this insanity. Does another work assignment of 600 pages anger you . . . yet? The mountain is at about 2500 pages to read now, and there’s more to come. What outrages will have to take place before you resist?

This may be too urgent to wait for November. Think about how you will deal with penalties for complying with rules you have never read, cannot possibly read and may not even understand. This regulator has already acted to put a minor player out of business. Are you next?

It’s time to act with a sense of urgency. Your customers, your employees, your stakeholders are counting on you.

Read more here:
CPSIA – It’s Raining Paper . . . .

CPSIA — ICPHSO Update – Remarks of Jay Howell on Hazard Reduction

Remarks of the CPSC’s Jay Howell on Hazard Identification and Reduction (again, this is not a transcript, just the points I found interesting or notable on issues typically discussed here):

Reasonable Testing Program is applicable for “non-children’s products”. There are several elements to this:

• product specs
• applicable certification test
• product testing plan
• remedial action plans
• program design and implementation documentation

Howell says these are common sense good business practices. I agree, by and large. Some of this is bureaucratic, however, and sets expectations better suited to mass market businesses than to small businesses. Will small businesses devote the considerable resources to this kind of paper pushing? If not, do these requirements set up those small businesses for possible big penalties? Perhaps.

Howell also discussed the need for “event-triggered testing”. Again, this is mainly common sense. On “periodic testing”, Howell acknowledges that there is no “one size fits all” answer to questions of frequency. He points out that testing frequency relates to the potential size of recalls. The more frequently you test, the smaller the batch size and the smaller the potential recall (with tracking labels). This is interesting if they actually will allow businesses to make this assessment themselves. The ability to make risk-reward choices would be a step in the right direction. One can only hope . . . .

He advises that you consider these factors:

• severity of possible injury
• production volume
• variability in test results
• test results close to applicable limits
• testing costs
• product complexity or uniqueness
• hidden hazards
• history of incident reports, warranty claims and returns.

Again, I consider this list to be sensible and basically a description of how to make a “duty of care” decision about your products. This kind of coaching by the CPSC is highly constructive and valuable. My only worry is whether this is a set-up for gotchas. I hope to someday restore my trust of the agency so that I can stop worrying about gotchas. This could be a “gotcha”. The CPSC needs to make sure that coaching is coaching, not a set-up.

The CPSC is sensitive to the issues of small volume producers, custom products, and the need for component part testing rules. There are a lot of issues buried in here. WATCH OUT for these rule releases and REMEMBER that your silence will be taken as TACIT APPROVAL. You will NEED TO send in detailed comments.

Jay also confirmed to me earlier today that the CPSC is now doing some recalls jointly with Health Canada. I noticed this last week but don’t know when it started. Not sure whether this is good or bad, especially since safety issues for manufacturers should be dealt with across all sales regions. Not sure how this will affect costs or risk. Legal actions in other countries can be excruciatingly expensive, and if encountered, has the potential to kill small businesses instantly.

Read more here:
CPSIA — ICPHSO Update – Remarks of Jay Howell on Hazard Reduction

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