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The "Two-Percent Rule" Under The Polymer Exemption of 1995

Date: Aug 08, 2005


The "two-percent rule," is not a rule under administrative law. Initially, it was a provision for reporting the chemical identity of polymers for the initial Chemical Substance Inventory (Inventory) under the Toxic Substances Control Act (TSCA). 1 In 1995, the "two-percent rule" was subsequently incorporated into the amended rules for preparing premanufacture notifications (PMNs) at subparagraph (iii) of 40 C.F.R. § 720.45(a)(2):

(2) For a polymer, the submitter must report the following: [ . . . ]

(iii) For monomers and other reactants used at 2 weight percent or less (based on the dry weight of the polymer manufactured), indicate on the PMN form any such monomers and other reactants that should be included as part of the polymer description on the Inventory, where the weight percent is based on either (A) the weight of the monomer or other reactant actually charged to the reaction vessel, or (B) the minimum weight of monomer or other reactant required in theory to account for the actual weight of monomer or other reactant molecules or fragments chemically incorporated (chemically combined) in the polymeric substance manufactured. 2

Analytical data or appropriate theoretical calculations must be maintained at the site of manufacture or import to support the incorporation level. Theoretical calculations are permitted if it can be documented that analytical measurement is not feasible or necessary to support the determination of how much of a reactant is chemically incorporated.

The two percent rule has been used for over 22 years in reporting information to be processed into polymer descriptions under TSCA. It has been generally the case that precursors of a polymer that are either used or incorporated at no more than two weight percent, while reportable, could be, but need not be included in the considerations leading to the formal chemical description of a polymer manufactured from those precursors. It has been is the submitter's choice to have such precursors considered or not considered in describing a polymer. On the other hand, there has been no choice for precursors used or incorporated (whichever is less) at more than two weight percent. Those precursors must be included in the information reported, and, ordinarily, they will be reflected in the name of the polymer. 3 The two-percent rule has not meant that a precursor reflected in the description of a polymer must be used 4 or incorporated5 at more than two weight percent. Therefore, it has been the case that any precursor reflected in the description of a polymer can be used at any concentration greater than zero, but a precursor generally must not be omitted or reduced to only a probability of being chemically incorporated. These applications and interpretations of the two-percent rule also applied under the initial polymer exemption of 1983.

Historically, only the used calculation for the concentration of a precursor was available, but in 1995, the incorporated calculation was added. Where the percent incorporated is accessible and can be supported, this method of calculation can lead to a lower percentage for decision making instead of the calculation for the percent used. A new polymer might also comport with an existing polymer based on the degree of the precursor's incorporation.

One might suppose that under the polymer exemption promulgated in 1995, the two-percent rule continued to be applied to polymers as it had with respect to the polymer exemption of 1983. That, however, is not the case.

In 1997, the EPA published a guidance document for the polymer exemption6 that changes the reporting provision known as the "two-percent rule." Within the 1995 polymer exemption, the "two-percent rule" operates differently than the way that it operates outside of the polymer exemption. Under the current polymer exemption, the EPA interprets the "two-percent rule" to mean that if a precursor is used or incorporated at less than or equal to two weight percent in the manufacture of a polymer,7 the manufacturer or importer cannot include that precursor in the "identity" of the polymer. If a manufacturer or importer uses or incorporates a certain monomer or reactant in an exempt polymer at less than or equal to two weight percent, the manufacturer or importer may not later use that monomer or reactant at greater than two weight percent under the exemption for the same polymer. In other words, there is no option by which a monomer or other reactant may be included in the "identity" of the exempt polymer if its initial concentration is less than or equal to two weight percent. As has previously been the case, if a reactant or monomer is used at greater than two weight percent in an exempt polymer, the reactant or monomer generally must not be eliminated completely from the polymer.

One situation is uncertain. It is whether a polymer that was initially manufactured under the polymer exemption with a given monomer or reactant used or incorporated at greater than two weight percent is the same polymer under the exemption if the same monomer or reactant is subsequently used or incorporated at a concentration that is greater than zero weight percent but equal to or less than two weight percent. Based on the EPA's guidance, it would appear that the subsequent version of the polymer as just described, would be the same polymer under the exemption as the initial polymer. We are seeking confirmation of this aspect of the application of the two-percent rule from the EPA.

There appear to be only two passages from the EPA's guidance manual that are relevant. The first reads:

. . . Monomers and reactants at greater than two weight percent make up the "chemical identity" of the polymer. For an exempt polymer, monomers and reactants at less than or equal to two weight percent are not considered part of the "chemical identity" of the polymer; and the use of these monomers and reactants creates a different set of issues, which are discussed below.

A manufacturer or importer must carefully decide at what weight percent level each monomer or other reactant is to be used in the preparation of the exempt polymer. This choice (which must be obvious from the manufacturing data kept by the manufacturer or importer) limits the manufacturer or importer of an exempt polymer in two major ways. First, if a certain monomer or reactant is used in an exempt polymer at less than or equal to two weight percent, the manufacturer may not later use that reactant at greater than two weight percent (under the exemption for the same polymer). The new polymer substance that results when the reactant is increased to greater than two weight percent is different, by definition, from the polymer that contains the reactant at less than or equal to two weight percent. Second, if a reactant or monomer is used at greater than two weight percent in an exempt polymer, the reactant or monomer must not be eliminated completely from the polymer (if the manufacturer is trying to satisfy the exemption for the same polymer). If either of these "identity-changing" events occur, the manufacturer must do one of the following: 1) find the new polymer identity on the TSCA Inventory, 2) submit a PMN at least 90 days prior to manufacture if the new polymer is not on the Inventory, or 3) meet the conditions of a PMN exemption to cover the new polymer identity.

Guidance Manual at 18-19 (emphasis in original).

The guidance is clear that if a manufacturer or importer uses or incorporates a certain monomer or reactant in an exempt polymer at less than or equal to two weight percent, the manufacturer or importer may not later use that monomer or reactant at greater than two weight percent under the exemption for the same polymer. However, there does not appear to be any way for one to know this prior to the guidance being issued in 1997.

The other limitation is stated, "Second, if a reactant or monomer is used at greater than two weight percent in an exempt polymer, the reactant or monomer must not be eliminated completely from the polymer (if the manufacturer is trying to satisfy the exemption for the same polymer)." This limitation, that if a monomer or other reactant is omitted from use or incorporation, the polymer is not the same, is not new. A reasonable interpretation of the language, "(if the manufacturer is trying to satisfy the exemption for the same polymer)" is that where the concentration of a monomer or reactant is initially greater than two weight percent in an exempt polymer, the concentration can be lowered to less than or equal to two weight percent, but not to zero to satisfy the exemption for the same polymer. This has applied and continues to apply to all polymers in all TSCA contexts. Reduction of the concentration to two percent or less seems permitted because the text does not say the opposite, and that limitation could have been so easily set forth.

The second relevant passage is a Question and Answer that reads as follows:

33. It appears from the polymer exemption rule and the technical guidance manual that a person does not have the option of including a reactant/monomer at less than or equal to two percent in the polymer identity. Is this true?

Yes, this statement is true. Polymers covered by a polymer exemption do not have a formal name. The "identity" is established by the percentages of monomers/reactants charged or incorporated in the polymer, as cited in the exemption-holder's records. If a polymer has less than or equal to two percent of a monomer/reactant, the identity does not contain that monomer/reactant. If an otherwise identical polymer is made, and the same monomer/reactant is a [(sic), apparently at was meant] greater than two percent, the identity of the second polymer is different from the first. Two exemptions would have to be claimed to cover both polymers.

For polymers for which a PMN is submitted, the submitter does have the option of including a reactant/monomer at less than or equal to two percent in the polymer identity.

Guidance Manual at 43.

The following sentences: "Polymers covered by a polymer exemption do not have a formal name. The "identity' is established by the percentages of monomers/reactants charged or incorporated in the polymer, as cited in the exemption-holder's records." describe a fundamental difference in the identity of a polymer under the polymer exemption and other forms of notification under TSCA. In other contexts, polymers do have formal chemical names and all monomers and other reactants and their concentrations must be reported, including those used or incorporated at two weight percent or less.

Under the polymer exemption, a polymer appears to be no more or less than a list of all of the precursors initially used or incorporated at greater than two weight percent. Any monomer or other reactant that is initially used or incorporated at two weight percent or less is not included in this concept of chemical identity. However, polymers that are structurally different can be the same under the polymer exemption.

This prohibition not to include precursors used at two percent or less in the list of precursors can give rise to additional polymers under the polymer exemption. If there are n precursors used or incorporated both at less than or equal to two weight percent and at greater than two weight percent in the list of a given polymer's precursors, there can be 2n potential polymers. There are pairs of such polymers: one must include the given precursor at greater than two percent and another must omit the precursor used at two weight percent or less. Under the ordinary two-percent rule, the manufacturer or importer can designate whether the precursor used or incorporated at less than or equal to two weight percent is to be included in or omitted from the polymer's chemical identity.

The prohibition not to include precursors used at two percent or less in the list of precursors might not stand judicial scrutiny. EPA has yet to respond in writing on the question.

Pending resolution of this issue with the EPA, we recommend that if a polymer will be manufactured or imported with any of its precursors at greater than two weight percent,8 that polymer has the same chemical identity if any of the same precursors are subsequently used or incorporated at two weight percent or less, but not eliminated. If that polymer also will be manufactured or imported such that any of its precursors that were at two weight percent or less, become more than two weight percent, then separate chemical identities must be established and separate records, certifications, and notices must be provided.9

The EPA guidance supports the concept that the same chemical identity, certification, and notice would support any number of polymers that use or incorporate any number of precursors at two weight percent or less so long as such use or incorporation does not otherwise affect the eligibility of the polymer. The polymer would only be identified on the basis of the precursors used or incorporated at greater than two percent. However, records must be kept documenting such use or incorporation of precursors at no more than two weight percent.

The EPA's goal might lead to more confusion than value. Most manufacturing situations would benefit more by being able to vary the concentration of a precursor above and below two percent while relying on the same chemical identity, certification, and notice. Because records need to be maintained of the changes thought to be fostered by the EPA's guidance, the departure from the way the two-percent rule ordinarily applies (and has applied in all other cases) does not have significant merit.

A superior policy would result if manufacturers and importers certified each set of precursors and were permitted the conventional use of the two-percent rule as under the original polymer exemption, PMNs, and other section 5 submissions. On this case-by-case basis, one could be more certain of compliance with the polymer exemption.

Although this guidance supposedly does not supercede any provision in the amended polymer exemption rule, there is no specific support for this belated guidance in the rule itself. Nonetheless, an Agency's interpretations of a rule are often given deference. If challenged, this particular interpretation might not be sustained.

Under the EPA's polymer exemption guidance, manufacturers and importers do not have adequate notice that if they reduce the level of a precursor from a level above two percent that they will have the same polymer or a different polymer that might not be in compliance. Those persons also have no adequate notice that a polymer might need two chemical identities for each precursor used or incorporated at more than two weight percent and two weight percent or less. Among other reasons, such as continuity with the initial interpretation of this reporting requirement, we believe that the EPA should retract its guidance on this point.

And what of a polymer manufactured from 51 or more precursors wherein each precursor is used or incorporated at no more than two weight percent? Perhaps one should notify the EPA that a polymer has been made that has no precursors that may be included in its chemical identity. Such a polymer has legion combinations and permutations of 51 or more precursors. In that case, one has the glory of reporting a polymer that consists of nothing at all.

140 C.F.R. § 710.5(c) (now withdrawn).

240 C.F.R. § 720.45(a)(iii). The language, "as part of the polymer description on the Inventory," which also appeared in the Inventory regulations seems to be the sole basis for inferring that the two-percent rule is applicable for interpreting Inventory listings. EPA has never published any rules directly bearing on the nomenclature used or interpretations that apply to the Inventory. The only formal rules have been in the context of reporting obligations for submitters.

3Certain precursors such as molecular oxygen are generally reflected in a reference to oxidation. Water is another exception; water is usually not treated as an ordinary reactant.

4In the context of the two-percent rule, the percent used means the weight percent calculated from the mass of the precursor charged divided by the mass of the product formed (both on a 100-percent active basis). The calculation is independent on the degree of chemical incorporation of the polymer, so long as there is some chemical incorporation.

5The percent incorporated in the amended two-percent rule means the weight percent calculated from the minimum mass of the precursor that theoretically could account for the mass or portion of the mass of the precursor that is chemically incorporated divided by the mass of the product formed (both on a 100-percent active basis). The mass of the precursor is often higher than the mass that is incorporated.

6U.S. EPA "Polymer Exemption Guidance Manual" EPA 744-B-97-001 (Jun. 1997).

7If the method of calculation yields levels of the precursor both above and below two percent, there is no guidance. We believe the manufacturer can choose the method of calculation and the corresponding results.

8Using whichever available method (use or incorporation) gives the lower value.

9U.S. EPA "Polymer Exemption Guidance Manual" EPA 744-B-97-001 (Jun. 1997).