Consumer Products Subject to New Requirements Under Consumer Product Safety Law

Consumer products—those products sold to consumers and used in and around the home, in schools and in recreation—are subject to a number of new requirements under the Consumer Products Safety Improvement Act (CPSIA). The legislation, signed into law in August 2008 by President George W. Bush, is being implemented by the U.S. Consumer Products Safety Commission (CPSC). The CPSC's role is to issue rules and guidance to clarify and enforce the provisions of the CPSIA.

The primary intent of the CPSIA is to prevent problems caused by unsafe toys. As a result, the most substantial changes in the law are in the area of children's products. But businesses dealing with all other consumer products are also affected by provisions of the CPSIA. Consequently, every business that deals with consumer products should be aware of the CPSIA and how it affects their particular business. Many of the CPSIA's requirements are subject to change in the coming weeks as the CPSC takes actions to clarify and enforce the legislation.

Children's Products

The largest group of consumer products affected by the CPSIA is children's products. Children's products are those consumer products that are designed or intended primarily for children 12 years of age or younger. This definition encompasses such broad ranging products as infant carriers, toys and children's apparel. Companies that manufacture, import, distribute or sell children's products are subject to CPSIA provisions. Some of the most onerous requirements for children's products are those concerning lead, phthalates, labeling and third-party certification.

Lead. The CPSIA imposes strict limitations on lead content in children's products. Beginning February 10, 2009, the lead content allowed in children's products will be limited to 600 parts per million (ppm) and will decrease thereafter to 300 ppm, and finally to 100 ppm. These limits currently apply to each individual component of the product, rather than to the product as a whole. For example, if the lead content of a zipper on a product exceeds the specified limit and does not qualify for another exemption, the entire product is in violation of the statute.

Component parts of a product deemed "inaccessible" are excluded from the lead content requirement. A component part is inaccessible if it is not physically exposed and does not become physically exposed through reasonably foreseeable use and abuse of the product. The CPSC has proposed a procedure for determining whether a particular component part is inaccessible, but it is not currently effective. The CPSC also has the ability to explicitly exclude certain products or materials from the lead content provisions.

Previous regulations limited the amount of lead in paint to 600 ppm. Under the CPSIA, lead in paint and other surface coatings will be limited to 90 ppm. This requirement affects the following consumer products: lead-containing surface coatings, furniture covered by lead-containing surface coatings, and children's products covered by lead-containing surface coatings. These items must comply with the lead paint requirement on August 14, 2009. Other consumer products are not affected by the lead paint change.

The lead content and lead paint requirements are retroactive. According to a written opinion by the CPSC's general counsel, the new standards will apply to products in inventory and on store shelves when they take effect. Therefore, distributors and retailers that have products that do not comply with the lead requirements will not be able to legally sell them. Manufacturers and importers, in turn, must adjust their supply chains to take into account this ban on sales.

Phthalates. Phthalates are chemicals that are used to soften plastics. They have been identified as affecting certain bodily hormones and as potential carcinogens. The CPSIA restricts the use of phthalates in "children's toys" and "child care articles." Children's toys are consumer products "designed or intended by the manufacturer for a child 12 years of age or younger for use by the child when the child plays." Items such as sportswear may or may not constitute a toy under the CPSIA. Child care articles are consumer products "designed or intended by the manufacturer to facilitate sleep or the feeding of children age 3 and younger, or to help such children with sucking or teething." Child care articles include, among other things, clothing such as bibs (facilitates feeding) and children's pajamas (facilitates sleeping).

If a product is considered a children's toy or a child care article, it is subject to the current restrictions on phthalates. On February 10, 2009, toys and child care articles cannot exceed 0.1 percent of di-(2-ethylhexyl) phthalate (DEHP), dibutyl phthalate (DBP) or benzyl butyl phthalate (BBP). Also beginning on February 10, 2009, and lasting until the CPSC issues new regulations on the subject, any toy that can be placed in a child's mouth or child care article that contains concentrations of more than 0.1 percent of diisononyl phthalate (DINP), diisodecyl phthalate (DIDP) or di-n-octyl phthalate (DnOP) is banned.

Unlike the lead requirements, only manufacturers and importers are likely to be affected by the phthalate ban. According to a written opinion by the CPSC's general counsel, the phthalate ban does not prevent the sale of children's products containing phthalates if the product was manufactured by the necessary date. So, as long as the manufacturer is compliant, the distributor and retailer are as well. There is currently a lawsuit challenging the CPSC's position: The National Resources Defense Council claims that the phthalates ban should, like the lead requirements, be retroactive. In addition, the California attorney general has stated that a California phthalate ban is not preempted by the CPSIA and acts retroactively within California after January 1, 2009.

Labeling. Beginning in August 2009, manufacturers and importers of children's products must place a tracking label on all products and packaging to the extent practicable. The information on the label is intended to help consumers and manufacturers determine if they own a defective or hazardous product. The tracking label must contain certain basic information, including: (1) the location and date of production; (2) the manufacturer, importer or private labeler identifier; (3) cohort information (including batch, run number or other identifying characteristic); and (4) any additional information the company thinks would help consumers identify the specific source of a product. The CPSC has the authority to alter these requirements by issuing new rules to specify wording or require further information.

Third-Party Tested Certificate. Manufacturers and importers of children's products are required to issue a third-party tested certificate that must accompany the products and be furnished to distributors, retailers, and, upon request, the CPSC. The certificate must be issued before importing, warehousing or distributing the product in commerce.

For the certificate to be properly issued, a manufacturer or importer of children's products must first identify every applicable consumer product regulation that applies to the product. For different products, these regulations can range from lead and flammability regulations to choking and sharp point regulations. After the applicable regulations are identified, the product must be tested for compliance with each regulation by a third-party laboratory that is approved by the CPSC. The CPSC is currently seeking information on whether testing of component parts should be acceptable, rather than testing the entire finished product. Component testing would likely allow, for example, a company to buy one type of zipper, have that zipper tested, and then use that zipper in many different products without having it retested in each instance. Lastly, the certificate must contain all the required information, including: (1) all applicable regulations, (2) the date and place of manufacture of the product, and (3) the date and place of product testing.

Due to constraints on the CPSC's resources and the need to find laboratories to conduct the testing, Congress determined that third-party testing should only be required as the CPSC approves the laboratory. The CPSC is approving laboratories to test for particular rules on an ongoing basis. So, until a particular laboratory is approved for a particular regulation, the manufacturer or importer of a children's product must issue a general certificate for such regulation. The general certificate is described below as it applies to every consumer product.

All Consumer Products

In addition to the requirements applying to children's products, many CPSIA requirements apply to all consumer products. Examples of requirements that apply to virtually all consumer products are the general certificate and recordkeeping requirements.

General Certificate. The most notable change for consumer products other than children's products is the general certificate requirement (sometimes called a "supplier's declaration of conformity"). Every domestic manufacturer or importer of a product subject to a consumer product safety standard must issue a general certificate. The primary purpose of the general certificate is to certify that the product conforms to all applicable consumer products regulations and standards. The CPSC's regulations apply to a broad range of products including clothing, cigarette lighters, mouthwash, ink cartridges and fireworks.

Unlike a third-party tested certificate, a general certificate does not need to be based on testing by an approved third-party laboratory. Rather, the certificate can be based on in-house testing. This in-house testing must be based on a test of each product or a reasonable testing program.

Like the third-party tested certificate, the general certificate must contain the information requested by the CPSC. The general certificate must contain all of the required information, including: (1) all applicable regulations, (2) the date and place of manufacture of the product, and (3) the date and place of product testing.

Recordkeeping. The CPSIA also authorizes the CPSC to issue recordkeeping regulations. The required recordkeeping is intended to demonstrate compliance with consumer products' statutes and regulations. However, even before the regulations are issued by the CPSC, every manufacturer of a consumer product is required to keep records of the name and address of each (1) retailer or distributor that is supplied the consumer product, and (2) subcontractor used in manufacture of the product. Importers, retailers and distributors of consumer products are required to identify a manufacturer's name and address, to the extent known, upon request by the CPSC.

Conclusion

The CPSIA's provisions affect almost every business that deals with consumer products. Those businesses that deal with children's products are the most substantially affected. Children's products are not only subject to new substantive requirements such as lead and phthalate restrictions, but also to many procedural requirements such as labeling and third-party testing. These requirements impact companies up and down the supply chain—from manufacturers and importers to distributors and retailers. The CPSIA also affects virtually all other consumer products through requirements such as general certification and recordkeeping.

The legal requirements under the CPSIA are currently in a state of flux as the CPSC attempts to rationally execute the legislation's provisions. The CPSC will clarify its stance on many unresolved issues in the coming weeks. All businesses that deal with consumer products should be aware of the provisions that apply to them and any actions by the CPSC to clarify and enforce such provisions.