Friday
July 20, 1988
Part II
4© CFR Part 350
Trade Secrecy Claims for Emergency
Planning, and Community Rlght-to-Knew
information; and Trad® Secret
e Healtti Frofessionais; Ffrja!
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28772 Federal Register / Vol. 53, No. 146 / Friday. July 29, 1988 /Rides and Regulations
ENVIRONMENTAL PROTECTION
AGENCY
40CFR P«rt 350
tFRL-33M-1]
Trad« Secrecy Claims for Emergency
Planning and Community Rlght-to-
Know information; and Trade Secret
Disclosures to Health Professionals
AGENCY: U.S. Environmental Protection
Agency (EPA).
ACTON; Final rule.
SUMMARY: This final rule publishes the
procedures for claims of-trade secrecy
made by facilities reporting under
sections 303(d){2) and (d)(3). 311,312
and 313 of the Emergency Planning and
Community Right-to-Know Act of 1988
(Act), and for EPA's handling of such
claims, for submission and handling of
petitions requesting reviews of trade
secrecy claims, and for disclosure to
health professionals of information
claimed as trade secret
DATE This rule is effective August 29,
1988.
ADDRESS: The record supporting this •
rulemaklng is contained in the
Superfund Docket located in Room LG-
100 at the U.S. Environmental Protection
Agency, 401M Street SW., Washington,
DC 20460. The docket is available for
inspection by appointment only between
the hours of 9:00 a.m. and 4:00 p.m.
Monday through Friday, excluding
Federal holidays. The docket phone
number is (202) 382-3048. As provided in
40 CFR Part 2, a reasonable fee may be
charged for copying services. ,
FOR FURTHER INFORMATION CONTACT:
Beverly D. Horn, Attorney-Advisor,
Office of General Counsel, Contracts
and Information Law Branch, LE-132G,
U.S. Environmental Protection Agency,
401M Street SW.. Washington. DC
20460, (202) 382-5460, or the Emergency
Planning and Community Right-to-Know
Information Hotline at 1-800-535-0202
(in Washington, DC and in Alaska at
(202) 479-2449).
SUPPLEMENTARY INFORMATION: The
contents of today's Preamble are listed
in the following outline:
I. Introduction
A. Authority
B. Background of this Rulemaking
C. Summary of Public Participation •
II. Trade Secrecy Claim Procedure
A. Definition of Trade Secret
B. Methods of Claiming Trade Secrecy
C Claims Under Sections 303 [d) (2) and
303{d](3)
D. Claims Under Section 311
B. Claims Under Section 312
F. Claims Under Section 313
G. Initial Substantiation
H. Substantiation Form ' "
I. Claims of Confidentiality in the
Substantiation
J. Updating Substantiations Submitted Prior
to Final Rule
K. Cross-Referencing of Substantiations
Li Submissions to State and Local
Authorities
III. Petitions Requesting Review of Trade
Secrecy Claims
IV. EPA Review of Trade Secrecy Claims
A. Overview of the Process
B. Initial Review
C. Determination of Sufficiency
D. Determination of Insufficiency
E. Determination of Trade Secrecy
F. Appeals
G. Common Errors Found on ;
Substantiations !
H. Enforcement
V. Relationship of Section 322 to Other
Statutes
A. Relationship to State Confidentiality
Statutes , -
B. Overlap with Other EPA-Administered .
Statutes - ;
C. Relationship to Freedom of Information
Act . ' "•' : ' '-.
VT. Release of Trade Secret Information
A. Releases to States '
B. Releases to Authorized Representatives
ofEPA '
VTL Disclosure to Health Professionals
A* Non-emergency Diagnosis or Treatment
B. Emergency Situations
C Preventive and Treatment Measures'
D. Statement of Need
E/Confidentiality Agreement
F. Related Issues " i ' '
1 VHL Summary of Supporting Analyses
A. Regulatory Impact Analysis
B. Regulatory Flexibility Analysis <
C. Paperwork Reduction Act
L Introduction \
A. Authority '
EPA publishes this rule pursuant to
sections 322,323, and 328 of the i
Emergency Planning and Community
Right-to-Know Act of 1988 (also known
as Title III or the Act), of the Superfund
Amendments and Reauthorizetion Act.
(SARA) of 1988, Pub. L. 99-499. Section
•322 provides the procedures for claiming,
trade secrecy and confidentiality for,
information submitted under sections
• 303 (d)(2) and (d)(3), 311, 312 and 313|of
the Act. It also provides a process
whereby members of the public can Hie
petitions requesting the disclosure of
chemical identities claimed as trade
secret. Section 323 provides procedures
for access to chemical identities, •
including those claimed as trade secret,
by health professionals who need the
information for diagnosis, treatment,; or
research. j .
B. Background of this Rulemaking \
The Superfund Amendments and
Reauthorization Act of 1988, Pub. L. 99^-
499, signed into law on October 17,1988,
amends and reauthorizes portions of the
Comprehensive Environmental
Response, Compensation, and Liability
Act of 1980 (CERCLA), 42 U.S.C. 9601 et
seq. Tide III contains the Emergency
Planning and Community Right-to-Know
Act of 1988,'which is itself a free-
standing statute. It contains provisions
requiring facilities to report to State and
' local authorities, and EPA, the presence,
use and release of extremely hazardous
substances (described in sections 302
arid 304), and hazardous and toxic
chemicals (described in sections 311,
312, and 313 respectively). For the
reporting required in sections 303, 311,
312 and 313, a submitter may under
certain circumstances claim the identity
of the chemical reported as trade secret.
1. Section 303
Section 303 involves the formulation
of comprehensive emergency response
. plans for extremely hazardous
substances. These are any of the
substances on a list published by EPA
under section 302: The regulations
implementing section 303 (and, because
of their relationship, sections 302 and
" 304) were published on April 22,1987, at
52 FR13378, codified at 40 CFR Part 355.
On December 17.1987, the Agency
deleted three of the substances from the
Extremely Hazardous Substances List,
and on February 25i 1988, the Agency
• deleted an additional 36. These
deletions were published hi rulemakings
at 52 FR 48072 and 53 FR 5574,
'respectively.
Any facility where an extremely
. hazardous substance under section 302
is present in excess of the threshold
quantity (as determined by EPA) must
report to the State emergency response
commission, established under section
301 of the Act. The local emergency
planning committee (LEPC), also
established under section 301 of the Act,
will contact any facility that has
identified itself in order to formulate a
local emergency contingency plan. In
this planning process, a facility is
required to provide the local emergency
planning committee with information the
committee requests, except that the
facility may withhold trade secret
chemical identity from the committee.
The facility must also inform the
committee of any relevant changes
which occur or are expected to occur
which may affect the contingency plan.
When informing the committee of these
changes, the facility may also withhold
trade secret chemical identity from the
committee. Trade secret claims for
chemical identities withheld from
facility reports must be substantiated
according to the requirements of this
regulation.
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28773
2. Sections 311 and 312
Section 311 inquires the owner or
operator of facilities subject to the
Occupational Safety and Health Act of
1970 (OSHA) and regulations
promulgated under that Act (25 U.S.C.
651 et seq* as amended, 52 FR 31852,
August 24,1987) to submit material
safety data sheets (MSDS), or a list of
the chemicals for which the facility is
required to have an MSDS, to the local
emergency planning committees. State
emergency response commissions, and
local fire departments. The facilities
were required to submit the MSDS OF
alternative list by October 17,1987, or "
three months after the facility is
required to prepare or have an MSDS for.
a hazardous chemical under OSHA
regulations, whichever is later. In
addition, a revised MSDS or list must be
submitted to the LEPC within three
months following the discovery of
significant new information concerning
an aspect of a hazardous chemical for
which an MSDS or list was previously
submitted. Facilities in the Bon-
manufacturing sector will be required to
submit the MSDS or alternative list
when the OSHA Hazard
Communication Standard (HCS) is
expanded to cover the
nonmanufacturing sector. Any trade
secret chemical identity may be
withheld from the MSDS or list of
chemicals, provided the submitter
follows the trade secret claims
procedures under the section 322
regulation.
Under section 312, owners and
operators-of facilities that must submit
an MSDS under section 311 are also
required to submit additional
information, on the hazardous chemicals
present at the facility. Beginning March
1,1988, and annually thereafter, the
owner or operator of such a facility must
submit an inventory form containing an
estimate of the maximum, amount of
hazardous chemicals present at the
facility during the preceding year, an
.estimate of the average daily amount of
•hazardous chemicals at the facility, and
the location of these chemicals at the
facility. Section 312(a) requires owners
or operators of such facilities to submit
the inventory form to the appropriate
local emergency planning committee.
State emergency response commission,
and local fire department on or before
March 1,1988, (or March 1 of the first
year after the facility first becomes
subject to the OSHA MSDS
requirements fora hazardous chemical}
and annually thereafter on March 1. For
the non-manufacturing sector, facilities
are first required to submit an MSDS or
alternative list when the HCS is
expanded io cover the non-
manufacturing sector, if the expansion
becomes effective in 1988, the first Tier I
or Tier II reports.are required beginning
March 1,1989.
Section"312 specifies that there be two
reporting "tiers" containing information
on hazardous chemicals at the facility in
different levels of detail. 'Tier I."
containing general information on the
amount and location of hazardous
chemicals by. category, is submitted
annually. "Tier IT," containing more
detailed information on individual
chemicals, is submitted upon request by
the State or local agencies. There will be
no trade secrecy claims for Tier I
reporting since no specific chemical
identity is required to be given.
However, submitters may withhold
trade secret chemical identity from the
Tier H form, and facilities should be
prepared to submit their trade secret
claims as appropriate, even if the Tier I
report is initially submitted.
As noted above, the Department of
Labor recently published a final HCS
rulemaking at 52 ER 31852, on August 24<
1987, expanding coverage of the
facilities required to maintahrMSDSs.
The number of facilities thereby subject
to reporting under sections 311 and 312
will have expanded from 350,000-to over
4 million, when the expansion becomes
effective.
The final rule for sections 311 and 312
was published on October 15,198? at 52
FR 38344.40 CFR Part 37O.
3. Section 313
Under section 313, a toxic chemical
release inventory form (published by
EPA) must be filed with a designated
State agency and EPA. This form must
be filed for any toxic chemical (OR a list
published by EPA) which is
manufactured, processed or otherwise
used in amounts exceeding the threshold
quantity at a covered facility. The form
also indicates the total annual releases
of the chemical to the environment A
covered facility is any facility with 10 or
more employees in Standard Industrial
Classification (SIC) Codes 20-39. The
rule for section 313 was published on
February 16,1988, at 53 FR 4500, 40 CFR
Part 372; As with other sections of Title
p, trade secret chemical identity may
be withheld from the toxic chemical
release inventory form.
4. Section 322 ' .
The section 322 regulations contain
the procedures which a submitter must
follow in order to file a trade secrecy
claim. Trade secrecy claims are
submitted to EPA only, by including
with the appropriate 303,311,312 or 313
submittals. as explained below, both a
sanitized and unsanitized trade secret
substantiation form. The unsanitized
version must contain the chemical
identity claimed as trade secret, and the
sanitized version is identical to the
unsanitized version in all respects
except that the trade secret chemical
identity is deleted, and in its place a
generic class or category to describe the
chemical is included. This sanitized
_ version is the one that is submitted to
the State or local authorities, as'
appropriate.
Section 322(b) of Title III requires a
submitter to substantiate its trade
. secrecy claim when submitting the filing
containing the chemical identity claimed
as trade secret This up-front
substantiation will consist of the
answers to six questions which are
intended to elicit sufficient factual
support to indicate whether the claim
will meet the criteria set forth in the
statute for a claim of trade secrecy.
In order to fully answer the six
questions in the substantiation, a
submitter may need to include
additional trade secret or other
confidential information. The statute in
section 322(f} allows submitters to
designate as confidential any
information in the substantiation
entitled to protection under 18 U.S.C.
1905 (the Federal Trade Secrets Act).
Claims of confidentiality, in the
substantiation are more expansive in
scope than those allowed under the
reporting requirements of the Act, and
are limited solely to information
necessary to substantiate the trade
secrecy claim. A detailed explanation
on how to make a trade secrecy claim
for .information in the substantiation is
found under section II.G. of this
Preamble.
The section 322 regulation also
contains the procedures to be used by
the public for requesting disclosure of
chemical identity claimed as trade
secret (This public petition process does
not cover requests for public disclosure
of information claimed as trade secret in
the substantiation other than chemical
identity. These requests for disclosure
must be submitted under EPA's Freedom
of Information Act regulations at 40 CFR
Part 2.) The section 322 regulation also
sets forth procedures the Agency must
follow in making a determination as to
whether any trade secrecy claim is
valid. These determinations will be
made by the program designated to
receive and handle trade secrecy claims
for that particular reporting section in
Title IH. The Office of General Counsel
will hear infra-agency appeals from the
determinations of trade secrecy.
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28774 Federal Register./ Vol. 53, No. '146 / Friday, July 29,1988/ Rules andjiegilations
5, Section 323
The section 323 regulation contains
provisions allowing health professionals
to gain access to chemical identities,
including those claimed as trade secret,
in three different situations. The first
situation is for non-emergency treatment
and diagnosis of an exposed individual.
Second, access is permitted for
emergency diagnosis, and treatment.
Finally, health professionals employed
by a local government may receive
access to a trade secret chemical
identity to conduct preventive research
studies and to render medical treatment.
In all situations but the medical
emergency, the health professional must
submit a written request and a
statement of need, as well as a
confidentiality agreement, to the facility
holding the trade secret The statement
of need verifies that the health - ,
professional will be using the trade
secret information only for the needs
permitted in th* statute, and the
confidentiality agreement ensures that
the health professional will not make
any unauthorized disclosures of the
trade secret In the event of medical •
emergency, the health professional
granted access to chemical identify
claimed as trade secret may be required
to execute a confidentiality agreement
C. Summary of Public Participation
EPA issued a proposed rule for trade
secrecy claims and for trade secret
disclosures to health professionals,
which was published in the Federal
Register on October 15,1987 (52 FR
38312). The proposed rule contained the
form for the substantiation to
accompany claims of'trade secrecy and
requirements for making claims of trade
secrecy under the Act After publication,
EPA received over 40 written comments
on the proposed rule. In addition, EPA
held public meetings in Washington, DC,
Chicago, EL, Boston. MA, Dallas, TX,,
and San Francisco, CA. Attendees at
these meetings presented oral comments
representative of a wide range of
interests including the affected industry,
environmental and other public interest
groups. State and local governments,
and individual citizens. These comments
are part of the official record of this
rulemaking
n. Trade Secrecy Claim Procedure
A. Definition of Trade Secret
1. Overview of Trade Secrecy Claims
The Emergency Planning and
Community Right-to-Know Act of 1988
does not give facilities blanket authority
to withhold any information they •
consider sensitive or confidential. The
purpose of the Act is to provide
information to the public, and the
statute limits the types of information^
that may be withheld as well as the ,
circumstances in which a claim of trade
secrec3~ can be made.
Regardless of the basis for a trade i
secret (e.g., a chemical's presence at a
facility, its use for a particular process,
or its production in a certain quantity),
the only information that a facility may
withhold from an Act's report (other ;
than location information, as explained
below) is the specific chemical identity.
When a facility makes a claim of trade
secrecy, it must provide all of the i .
information normally required to be i
reported with the sole exception of the
specific identity of the chemical being
claimed as trade secret
Submitters of trade secrecy claims
must distinguish two concepts: (1) What
may be withheld; and (2) the basis for
withholding information. As noted, the
only information that maybe withheld •
from a public report is the identity of a
chemical found at a facility. i
The basis, or reasons, for considering
a chemical identity as-a trade secret can
vary. In most instances, the presence, of
the chemical at a facility is die basis lor
a chemical being a trade secret .:
However, in certain instances facilities,
• may believe the connection between the
chemical identity and other information
that must be included on the Act's
reports, such as quantity or process
information, may also be a b-isis for a
claim of trade secrecy. For example, a
facility may believe that its estimate of
the maximum amount of chemical X on
site on its toxic-chemical reporting form
under section 313 is a trade secret, even
though public knowledge of its use of
chemical X is not In such a case, the
connection or as it is sometimes termed,
the linkage, of the chemical identity with
the quantity information is the basis jfor
the facility's trade secrecy claim. ; .
However, the facility may only withhold
the chemical identity (i.e., chemical X in
this example); .the quantity on site must
still be reported. As Congress provided,
public reports would not disclose the
specific chemical, although a generic
name for chemical X must be provided
as a substitute, as well as data on its
hazardous characteristics and adverse
health effects. Hence, what can be ;
withheld is only the chemical identity,
but facilities may base their trade j
secrecy claims on the connection
between the. chemical identity and a;
. broader set of information required on
the Act's reports. I
This discussion, so far, has dealt with
trade secrecy claims for chemical ;
identity on the reports required under
the Act This is the class of trade secret
claims addressed by the rule. However,
two other classes of confidential
information are also involved under the
Act,, and rules for treatment of these are
different.
First, when facilities explain why a
chemical is a trade secret, it is
recognized that they may need to cite
other confidential information (such as
process or financial data) in their
substantiations. The statute and the rule
allow facilities to make claims of
confidentiality, explained below, for
information they provide on their
substantiations accompanying claims.
Second, location information required
under section 312 is considered a
separate class of confidential
information, and is provided only to
State and local recipient(s). Section 312
location information should not be sent
to EPA. The statute does not require
facilities to justify the confidentiality of
either of these two types of information
under section 322. Under section 324,
copies of the publicly available
substantiations for trade secrecy claims
are accessible during normal business
hours through the designated State and
local authorities, and through EPA, as
appropriate. These substantiations are
also accessible under the Freedom of
Information Act, as discussed at section
V.C, of this Preamble. •
2. Rationale
The definition of a trade secret in this
regulation is equivalent to that in the
Restatement of Torts, section 757, and
the regulation developed by the
Occupational Safety and Health
Administration to implement its Hazard
Communication Standard, 52 FR 31876
(August 24,1987), 29 CFR 1910.1200. The
OSHA Hazard Communication
Standard requires disclosure of the
specific chemical identity of chemicals
to which employees are exposed in the
workplace, except in those cases in
which the identity of the chemical in
question can be justified by a facility to
be a bona fide trade secret The U.S.
Court of Appeals ruling in United
Steelworkers of America v. Auchter, 763
F.2d 728 (3d Cir. 1985), required that
OSHA amend its Hazard
Communication Standard to adopt a
definition of trade secret that conformed
. to common law protections. OSHA
selected the generally accepted
definition provided in the Restatement
of Torts, section 757, Comment b (1939),
which reads: " 'trade secret' may consist
of any formula, pattern, device, or
compilation of information which is
used in one's business, and which gives
[the employer] an opportunity to obtain
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Rules and Regulations
an advantage over competitors who do
not know or use it."
The Emergency Planning and
Community. Right-to-Know Act of 1988
only allows trade secrecy claims for a
subset of the material which is
traditionally covered under trade
secrecy law. Section 322(a) specifically
states that submitters under Title III
may withhold only the "specific
chemical identity (including the
chemical name and other specific
identification)" as a trade secret The
"specific chemical identity" means
either the chemical name or other
specific identification that reveals the
precise chemical designation of the
substance, such as the Chemical
Abstract Services Registry Number
(CASRN).
In the proposed rule, EPA set forth
several options for determining the
permissible basis for claims of trade
secrecy for specific chemical identity;
The most narrow interpretation* of the
statute would be to limit all claims of
trade secrecy .to claims protecting either
the composition of the chemical, or the
. presence of the chemical at the facility.
Congress stated in the Conference
Report that, "the knowledge of [the]
presence [of a specific chemical] at the
purchasing facility could effectively
define for its competitors the process
and/or products being made there." H.R.
Conf. Rep. No. 99-96% 99th Cong., 2d
Sess. 304 (1S88).
The second option set forth in the
proposed rule was to allow, as a basis
for a claim of trade secrecy for chemical
identity, that the connection, or
"linkage" between chemical identity
and other information on the Title in
form would reveal the trade secret.
Throughout the Conference Report
Congress displayed general concern for
the protection of all legitimate trade
secrets. For instance, in discussing the
reporting requirements under section
313, it was noted, "[t]he conference
substitute provides for reporting
categories of use and ranges of chemical
present because the exact [identity] of
identified chemical[s] at a facility or the
exact amount present may disclose
secret processes." Id at 298. Similarly,
in discussing the reporting requirements
under section 312, Congress stated, "p]n
order to protect chemical process trade
secret information, reporting ranges may
need to be broad." Id. at 290. Congress
probably anticipated that it would be
possible for th& Act's reporting forms to
be structured broadly enough to avoid
compromising legitimate trade secrets.
In the proposed rule, the Agency stated
that it was making every effort to do
this. EPA believed that even with the
use of broad ranges and reporting
categories, however, the amount of
detail requested on the Act's forms
would in some cases allow competitors
of submitters to compare and thus to
link information, thereby revealing
valuable trade secrets.
EFA's proposed interpretation of the
basis for a claim of trade secrecy for
chemical identity was supported by
several comments from industry voicing
concurrence with Congressional intent
to provide trade secret protection to
trade secret information about use,
processing, and handling which might be
linked to corresponding chemical
identities reported under sections 311,
312, or 313. Industry commenters
referred to the definition of trade secret
put forth in the Restatement of Torts to
assert that the Agency's linkage concept
is firmly rooted in traditional trade
secret law, where trade secrecy of
chemical-identity occurs because of
links between that chemical identity and
other data Consequentlyi some
commenters suggested that denial by the
Agency of trade secret protection to
linked information, and its disclosure to
the public, would constitute a taking
under the Takings clause of the Fifth
Amendment, even though the specific
identities of component chemicals might
be well known to the public.
EPA also received some comments
from public interest groups which
disagreed with this interpretation. They
argued that trade secrecy claims should
be restricted solely to claims for the
presence or chemical composition of the
chemicals present at a facility, and not
allowed for any linkages between
chemical identity and other data. These
comments claimed that the four criteria
listed under section 322(b) apply only to
trade secrecy claims for specific
chemical identities, and reflect
Congressional intent to maximize the
availability of information to the public.
One group asserted that trade secret
regulations intended to protect claims
for linkage "will encourage the filing of
excessive claims of trade secrecy, as
well as claims- that cannot be
substantiated in accordance with
section 322(b)" of the statute.
After carefully considering the
comments, the OSHA HCS, the
Conference Report, and trade secret
case law, EPA has decided to allow
trade secrecy claims for chemical
identity to be made to protect the
linkage between-a specific chemical
identity and other (information about its
use, production, storage, or processing.
Such claims will be permiued even in
cases when the specific chemical
identity is already known to the public;
however, the submitter will always have
to prove that its trade secret meets the
four criteria under section 322(b) by
submitting the up-front substantiation
described in section II.G. of this
Preamble. In all trade secrecy claims the
specific identities of chemicals present
at the facility are the only reporting
information that may be withheld, in
accordance with the statute; all other
information requested on the Act's
forms must be reported.
Generally accepted trade secret law
found under the Restatement of Torts
and the OSHA Hazard Communication
Standard supports protection of linkage
information. According to these
precedents, confidential information
does not necessarily depend on public
knowledge of one component of a
production process; rather, it is often the
means by which components are
combined and used which renders the
information a protectable trade secret.
The Agency believes that this
interpretation of the basis for a claim of
trade secrecy will not involve great
numbers of additional claims beyond
those that could also be based on the
narrower concept of simple presence at
a facility. Submitters of trade secrecy
claims for linkage information will still
have to meet the same four criteria in
section 322(b) which all trade secrecy
claims must meet.
EPA also believes that this
interpretation does not run counter to
the purpose of the Act—that of public
disclosure—because the requirement of
an up-front substantiation, which will
cause submitters to justify their claims,
will limit spurious claims. Further, EPA's
intention is to routinely evaluate trade
secrecy claims and to vigorously
prosecute those submitting frivolous
claims. The $25,000 penalty per frivolous
claim under such circumstances is
evidence of Congress intent to deter
such claims. All submitters should be . •
aware that supplemental information
submitted to EPA after the initial
substantiation should clearly confirm
the validity of their claim as set out in
the initial substantiation, or they may be
subject to the penalty for frivolous
claims.
3. Emission and Effluent Data
The Natural Resources Defense
Counsel, Citizens for a Better
Environment, and OMB Watch have
argued in their comments that EPA
cannot allow claims of trade secrecy for
data collected on the section 313 toxic
release inventory form because this data
is emission or effluent data that is
required to be made public by the Clean
Air Act and the Clean Water Act.
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28776 Federal Hflgjater / yol. 53. No. 146 / Friday. July 29, 1988 / Rules and Regulation^
Section 322(b) of Title m requires that
a trade secrecy claimant demonstrate,
when making a trade secrecy claim, that
the chemical identity claimed as trade
secret "is not required to be disclosed,
or otherwise made available, to the
public under any other Federal or State
law." The commenters claimed that
under section 114(c) of the Clean Air Act
and section 308(b) of the Clean Water
Act, emission and effluent data,
respectively, are required to be made
public and, therefore, when collected
under Title ID must be made public.
Section Il4(c) of the Clean Air Act
requires that:
Any records, reports, or information
obtained undtr [the Clean Air Act] shall be
available to the public, except that upon a
showing satisfactory to the Administrator by
any person that records, reports, or
information, or particular part thereof (other
than emission data) to which the
Administrator has access under this section,
would divulge methodic* processes entitled •
to protection aa «rad« secrets * * * the
Administrator shall consider such
record * * * confidential. (Emphasis added).
Section 308(b) of tha Clean Water Act
has a similar provision excepting-
effluent data from confidential
treatment
Information which has beetr
determined administratively (by EPA) or
judicially (by a court on appeal from aa
EPA determination} to constitute
emission or effluent data within the
meaning of section 114{c) of the Clean
Air Act, or section 308(b) of the Clean
Water Act i» clearly required to be-
disclosed to the public and could not be
withheld from disclosure under section
322(b). Thus, a company could not claim
as trade secret under Title HI
information which is part of a class of
information for which EPA has, by
regulation or otherwise, prohibited a
claim of business confidentiality, such
as information required in National
Pollutant Discharge Elimination System.
(NPDES) permit applications. 40 CFR
section 122.7(c). Also, a company could
not claim a* trade secret under Title HI
data already collected by EPA under
another statute, such as the Clean Air or
Clean Water Acts, where the Agency
had decided that the data presented no
valid claim of trade secrecy, either
because it was emission or effluent data
or for other reasons, such as, that no
valid trade secrecy claim was presented.
The question posed by the comments
concerns the exact meaning of the prior
disclosure language—does this language
concern only the circumstances
described above, where EPA has
determined, either generically or
specifically, whether the information is
eligible for trade secret status, or does it
!
also concern circumstances where the,
information's trade secret status is
undetermined. The commenters argued
that information which EPA could j
obtain, but has not requested, under the
Clean A !,r or Clean Water Acts and
which could constitute emission or
effluent data, cannot be claimed as ;
trade secret on the section 313 form or in
other Title III submissions.
The comments also raised the same
question regarding information in EPA's
possession which could constitute
emission or effluent data but as to which
no determination has been made. The:
commentera argued that this information
also cannot be claimed as trade secret if
later submitted under Title HI. In so
arguing, the commenters assumed that
the definitions of emission and effluent
data are self-executing and therefore
that no trade secrecy claims should eyen
be accepted by EPA for information '
which could be emission- or effluent
data.
There is- no discussion of this issue in
the Conference Report ox elsewhere; i
however, EPA's position i» that the most
probable interpretation is that Congress
intended to prevent trade secret j
claimants, from claiming as secret j
information which was already in the
possession of a State or Federal agency,
and was required to be disclosed, either
because no claim of confidentiality was-
permitted under State or Federal Jaw, or
because a decision had been made that
no valid claim was presentee",
The comments did not address the
threshold issue of the definition of
emission or effluent data, merely :
asserting that EPA's definitions are \
"self-executing." EPA does not consider
this definition to be self-executing. The
definition of emission data provides:, •
(2)(i) "Emission data" means, with |
reference to any source of emission of any
substance into the air— :
(A) Information necessary to determine the
identity, amount, frequency, concentration, or
other characteristics (to the extent related to
air quality) of any emission which has been
emitted by the source (or of any pollutant
resulting from any emission by the source), or
any combination of the foregoing; ;
(B) Information necessary to determine the
identity, amount frequency, concentration, or
other characteristics (to the extent related to
air quality) of the emissions'which. under an
applicable standard or limitation, the source
was authorized to emit (including, to the;
extent necessary for such purposes, a |
description of the manner or rate of operation
of the source); and • ,
(C) A general description of the location
and/or nature of the source to the extent
necessary to identify the source and to ;
distinguish it from other sources (including, to
the extent necessary for such purposes, a
description of the device, installation, or
operation constituting the source). ,
40 CFR 2.301(a)(2)(i) (A), (B). and (C).
Whether information constitutes
emission or effluent data depends on
what information is "necessary" to
make the needed determination. EPA
has to date made no determinations that
categories of information always
constitute emissions data. Instead, EPA
has proceeded on a case-by-case basis.
The regulations interpreting the Clean
Water Act contain a similar definition
for effluent data, information "necessary
to determine the identity * * * or other
characteristics * * * of any pollutant
which has been discharged by the
source * * *" 40 CFR 2.302(a)(2)(i). The
NPDES regulations under the Clean
Water Act (CWA) do not, however,
allow confidential treatment of
information required by, or contained in
NPDES permits or permit applications,
or of data concerning the discharge of
pollutants regulated in the permit, and
accordingly, that data is not allowed
trade secrecy treatment under section
313. Submitters claiming this
information as confidential may be
subject to penalties under section 325(d)
for submission of frivolous claims.
Submitters should be aware that data
submitted on the section 313 form will
be used for activities conducted under
the Clean Water Act (including
implementation of section 304(1) of the
Clean Water Act and development of
NPDES permit limits) and Clean Air Act.
EPA is in the process of developing a
class determination under 40 CFR 2.207
which would find that information,
including chemical identities, submitted
on the section 313 form regarding
releases to air or to waters of the United
States or to Publicly Owned Treatment
Works, is emission or effluent data
under the Clean Air or Clean Water
Acts and, as such, is not eligible for
confidential treatment under section 322
of Title HI.
The commenters also argued that the
definition of emission and effluent data
includes not only data which was
actually collected under section 114(c)
and 308(b), but data which "could have
been" collected under these sections,
citing 40 CFR 2.301(b)(2) and 2.302(b)(2).
Thus, the commenters argued that any
data which could be gathered under the
Clean Air Act cannot be claimed trade
secret when submitted to the Agency
under section 313.
The Clean Air Act regulations at 40
CER2,301(b)(2) state: ,
Information will be considered to have
been provided or obtained under section 114
of the Clean Air Act if it was provided in
response to a request by EPA made for any of
the purposes stated in section. 114. or if its
submission could have been required under
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28777
section 114, regardless of whether section l!4
was cited as the authority for any request for
the information * * * (Emphasis added.)
The comparable section of the Clean
Water Act regulations has a similar
provision. See 40 CFR 2.302(b)(2).
On this basis, the commenters argued
that because the data collected under
section 313 of Title III is emission or
effluent data which could have been
collected under section 114(c) of the
Clean Air Act or section 308(b) of the
Clean Water Act, no trade secrecy
claims can be made for chemical
identities of chemicals for which
emission or effluent data is included on
a Title III submission.
The commenters have misconstrued
the meaning and function of the "could
have been" language. It serves to
prevent submitters from thwarting EPA's
statutory right to obtain data by
voluntarily submitting it to the Agency
for the use of the Clean Air or Clean
Water programs, and then arguing, as
-voluntarily submitted, that it is not
subject to statutory limits on trade
secret or confidential business
information.
For these reasons, EPA .does not agree
with the commenters, assertions that the
provisions of the Clean Air and Clean
Water Acts render most trade secrecy
claims invalid under section 313. The
final rule adopts the interpretation set
forth in the proposed rule With respect
to the meaning of the language under
section 322(b), regarding whether
information claimed as trade secret is
required to be disclosed under another
State or federal law. Thus, information
is required to be disclosed under
another Federal or State law if:
(i) It is information that is specifically or is
in a class that is determined administratively
(by EPA) or judicially (by a court on appeal
from an EPA determination) to constitute
emission or effluent data within the meaning
of section Il4(c) of the Clean Air Act or
section 308(b) of the Clean Wate? Act; or
(ii) It is information which is either
specifically or in a class for which EPA or
any other State or Federal Agency has
disallowed confidential treatment, such as -
information required by EPA in NPDES
permit applications; or
(iii) It is information collected by EPA or
another State or Federal Agency where the
State or Federal Agency has decided that the
data presented no valid claim of trade
secrecy (for any reason).
B. Methods of Claiming Trade Secrecy
There are five different types of
submissions that can be made under
Title III on which a facility may make a
claim of trade secrecy. These are: (1)
The notification (to a local emergency
planning committee) of any changes at a
facility which would affect emergency
plans, under section 303(dJ(2); (2)
answers to questions posed by local
emergency planning committees under
section 303(d)(3); (3) material safety data
sheets or chemical lists submitted under
section 311; (4) Tier II emergency and
hazardous chemical inventory forms
submitted under section 312; and (5) the
toxic release inventory form submitted
under section 313.
1. Basic Requirements
The basic requirements for making a
claim are similar, although there are
some differences between submissions
under the different sections. These
differences will not affect the validity of
a submitter's claim, provided the
submitter adheres to all of the
requirements.
When fashioning reporting
requirements under Title ffl, EPA has
made every effort to avoid unnecessary
duplication. To this end, when reporting
under section 303 (d){2) and (d}(3), and
under section 311 using an MSDS, EPA
only needs to receive a copy of the
submittal sent to the State and local
authorities. This submittal is a public
document, and should not contain the
specific chemical identity claimed as
trade secret EPA is not requesting an
unsanitized version of this submittal.
When reporting under section 311
using the list approach, and for alh
section 312 Tier!! forms, and section 313
reports, EPA must receive at the same
time both an unsanitized and a sanitized
version of the reporting form. A
sanitized copy of the reporting form is
one in which the chemical identity
claimed as trade secret is deleted and in
its place is included the generic class or
category of the chemical claimed trade
secret. This sanitized copy should be
identical to the copy submitted to the
appropriate State and local
organizations in all respects except that
it does not contain the chemical identity.
Finally, EPA must receive
substantiations for each chemical
claimed as trade secret under all
reporting sections, as explained in
section II.G. below. EPA must receive
both sanitized and unsanitized versions
of the substantiation. Although these
items are the minimum required for a
claim of trade secrecy under all
sections, EPA suggests that submitters
carefully review the requirements 'under
each section before filing a trade
secrecy claim.
In this rule, the term "sanitized" is
used to refer to the copy of the report or
substantiation which does not contain
the chemical identity of the chemical
that is being withheld as trade secret.
The term "unsanitized" refers to a report
or substantiation that contains the trade
secret chemical identity. EPA received
some comments from the public
objecting to the use of these terms on
-the grounds that an "unsanitized" item
is sometimes regarded as "unclean."
EPA has decided to retain these terms
because they are terms of art often used
to indicate whether or not these
documents contain information that may
be released to the general public; their
continued use helps to clarify the terms
of the rule.
EPA received some questions as to
, whether a trade secret claim must be
made at the same time the Title III
submittal is submitted. Section 322
requires a submitter making a claim of
trade secrecy to include in the submittai
an explanation of why the information is
claimed to be a trade secret. This clearly
requires that the substantiation must be
filed concurrently with the submittal.
To facilitate accurate processing and
filing of these confidential documents,
submitters of claims to EPA should
arrange the parts of each claim in the
following order: (1) The unsanitized
trade secret substantiation, (2) the
sanitized trade secret substantiation, (3)
the unsanitized reporting document (not
applicable to section 303 reports and
section 311 MSDSs, as explained
below), and (4) the sanitized reporting
document-Each substantiation and
reporting document should be
individually stapled but the Agency
requests that the individual parts for
each claim be assembled into a single
package using only a binder clip or
rubber band. Do not staple the
individual parts together.
When facilities submit trade secrecy
claims for more than one chemical, EPA
requests that the three or four parts
associated with each chemical be
assembled as a set and each set for
'different chemicals be kept separate
within the package sent to EPA.
2. Users of Trade Name Products
Reports and claims regarding mixtures
and trade name chemical products raise
a number of special issues. Public
comments were received on a number of
points that EPA clarifies below.
Public comments indicated some users
are concerned as to their responsibilities
in cases where they do not know the
chemical identity of mixtures and trade
name products. Commenters were
concerned about whether they had to
submit a trade secrecy claim if they did
not know the specific chemical identity
of the product they use, even though
they do not consider that the fact that
they use the product is a trade secret.
EPA does not require a trade secrecy
claim if the user does not consider its
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Federal Register / Vol. 53, No. 146 /'Friday.. July 29, 198ft / Rules and Regulations
use of the product as a trade secret For
example, if a user does not know the.
specific chemical identity of a chemical
and must provide a common name or
trade name on the Title III submitted
EPA does not require a daim of trade
secrecy for the omitted chemical identity
because this identity, being unknown to •
the user, cannot be provided in such an
instance. This; issue is also discussed in
the section 313 final rule addressing
supplier notification. See S3 FR 4500.
If the submitter considers its use of
the trade name chemical as a trade
secret, it may file a trade secrecy claim
according to the usual procedures set
forth in this rule; The user will be
allowed to file for trade secrecy treating
the trads name as the chemical identity
and filling out those parts of the Title ffl..
aubmittal sent to EPA that it can supply
without knowing the specific chemical .
identity. The user must idll file, a
complete substantiation. When making
trade secrecy claims for trade name-
products, some commenters.-indicated
that portions of the substantiation
questions-would not apply to their trade
secrecy claim, however. If so, EPA
requires that the user making a trade
secrecy claim for its use of a trade name
chemical must answer each question by
explaining why it believes the question
to be inapplicable. f .
EPA does not extend permission to
file trade secret claims for common or
trade names to users that know the
specific chemical names of the chemical
to be reported and consider that
chemical use to be a trade secret If
users know the chemical names of
substances they use and wish to file a
trade secrecy cWr", they must make the
claim in terms of the chemical names of
the substances. On the other hand,
downstream chemical users and
chemical licensees who. happen to know
the chemical identity of the trade name
chemical are not required to submit
claims of trade secrecy based solely on
their knowledge of the specific chemical
identity since this requirement would
entirely duplicate the trade secrecy
daim of the original chemical
manufacturer and serve no purpose.
In the rulemaking process, EPA
considered more extensive requirements
on users making trade secrecy claims for
their uses of trade name chemicals. One
approach would have required suppliers.
to inform EPA of the chemical identity
and complete the substantiation
questions for the users who wished to
make a trade secrecy claim. Another
option considered was the "beat efforts"
approach based on the proposed section
313 rule [52 FR 21151,21155), which
would have required the user to make
multiple attempts to obtain the chemical
identity from the supplier, including \
offering to enter into a confidentiality
agreement with the supplier.
In some cases; it ».ay be especially .
difficult for facilities to acquire from ;
their suppliers the identity of chemicals
claimed trade secret by their, supplier. i
Users of chemicals may encounter
instances where the supplier does not |
have the same interest in providing ;
information to thenrorin protecting thfe
confidentiality of their trade secrets.
Suppliers may, in some instances, sell to
competitors from whom a facility wishes
to keep chemical identities or-
applications a trade secret EPA decided
on the more pragmatic approach of
allowing users of trade secret chemicals
who- wished to make a trade secrecy ,
claim for their use of the trade name
chemical to file claims-based on their
current knowledge; rather than having to •
rely, upon obtaining cooperation from
suppliers,, i •• • ., \ •
3. Licensees . ; •
One commenter stated that the rule!
does not address trade secret protection-'
in the context of licensing-arrangements
that include private confidentiality •
agreements, between suppliers and
users. The commenter asserted that in .
these instances, a facility that is i
licensed to produce, or otherwise use a
• trade secret chemical may have
information about that chemical. i
including its chemical' identity. At the
same time, neither the •chemical identity
nor the use of the chemical is the trade
secret, of the licensee, and the licensee
may not be able to justify it as such. As
a response to this circumstance, the
commenter suggested that the rule !
- provide for a blanket trade secret |
substantiation by the licensor with a
letter submission by the licensee
referring back to- the licensor's j
substantiation or explanation '
submission. ,
EPA requires In the above- situation
that user? who are licensees of trade:
* secret chemicals and who wish to make
a trade secrecy daim for their own use
of the chemical, file a claim of trade \
secrecy. If possible, these submitters !
should obtain the information necessary
to. complete the substantiation form,
where relevant, from the supplier with
whom they signed the confidentiality
agreement to the extent such :
, information is needed to answer the i
questions on the form. If, upon review of
the claim EPA requests supplemental
information which the licensee does not
have, the licensee will be required to
contact the licensor who must contact
EPA directly with the necessary :
information. • ;
4< Addresses for Claims and Petitions
All trade secret claims and petitions
requesting disclosure of identities
claimed as trade secret should be sent to
the following address:
U.S. Environmental Protection Agency,
Emergency Planning and Community
Right-to-Know Program, P.O. Box
70266. Washington, DC 20024-0266
Submitters may hand deliver their
• submittals tot
Title EL Reporting Center, 470/490
L' Enfant Plaza East SW., 7th Floor,
Suite 7103. Washington, DC
C. Claims Under Sections 303(d)(2) and
303(d)(3)
Section 303 concerns the formulation
of contingency plans by local emergency
planning committees. Section 303(d)(2}
states that owners or operators of
facilities must promptly inform
committees of any relevant changes
occurring at the facilities as the changes
occur or are expected to occur. Section
303(d)(3) states that owners or operators
of facilities must promptly provide
information to committees when
. committees request information from
facilities necessary for the development
and implementation of emergency plans.
A trade secrecy claim under section
303(d}(2) must include a copy of the
notification of changes in the facility
that was provided to the local
committee-This notification may be in
. the form of a letter or other written
communication. The document must
include the name and address of the
submitter. A trade secrecy daim under
section 303(d)(3) must include a copy of
the information requested by the local
emergency planning committee and the
information provided by the facility in
response to the request A letter or other
written communication containing this
information is sufficient. The document
must include the name and address of
the submitter.
In both of these submittals, where
there is a need to refer to a specific
chemical identity, the generic class or
category of each chemical ("class" is
synonymous with "category") claimed
as trade secret should be used instead of
the trade secret chemical identity. The
generic class or category for chemicals
subject to section 303 reporting is
discussed below in this section.
EPA is taking the burden-reducing
step of not requiring submitters to
prepare an unsanitized version of this
document for the reason that EPA will
be receiving the claimed chemical
identity on the unsanitized version of
the substantiation form. For each
chemical identity daimed as trade
-------
secret in a section 303. report, a complete
substantiation must be submitted to
EPA. The substantiation will be
discussed in greater detail hi section
ILG. below. Claims.should be packaged
. as described hi section ELB.1. of this
preamble, and hi instructions to the
substantiation form.
Generic Class, or Category
. When a local emergency planning
committee develops its contingency
plan, identification of the specific
chemicals that are present in its
jurisdiction is vital to the development
of the plan and is the first issue to be
resolved in the initial preparation of the
plan. As stated above, if a facility does
not wish to reveal the specific chemical
identity to the committee in the context
of sections 303 {d)(2}and (d)(3), the
section 303 submittalmuat include in the
place of chemical identity, the generic
class or category of the chemical
claimed a« trade^ecretjElie purpose of
the generic class or category is to '
provide a description; of the chemical
that is hot as specific as the specific
chemical identity, the generic class or
category should provide the best
description possible of the claimed
chemical. a» explained below.
The purpose of 8 contingency-plan is
to provide effective, expedient
emergency response to aid response
workers, and community residents in the ;
event of a chemical release. In order to
prepare an effectivecontingency plaiu
the hazards involved with; the specific
chemicals such as explosivity or
flammabih'ty and the adverse health
effect* associated with the release must
be known. Only by knowing this
information, can proper equipment and
procedures be used to contain the
release. If chemical identity is claimed
as trade secret by a facility, such
infonnation can m many circumstances
still be obtained through the
determination of a generic class or
category that reflects the information, as
well as by other questions posed to the
facility by the local emergency planning
committee.
The proposed rule set forth for public
comment three alternatives regarding
the choice of generic class or category
for Title III submittals under sections
303 (d)(2) and (d)(3). The alternatives all
required negotiation because the
Agency believedit would be impossible
to devise a finite list ofgeneric classes
or categories that would incorporate the
wide variety of safety factors that
LEPCs and the general public may
desire to know. These safety factors
included chemical release hazards,
adverse health effects information^
distance of the affected community from
the facility, level of sophistication of the
first responder, and type of land use
near the facility. Language in the
proposed rule suggested that safety
factors should, be reflected in the generic
class or category chosen.
The alternatives suggested in the
proposed rule were:
(1) LEPCs and owners or operators would
negotiate a suitable class or category, with no
example list offered by the Agency;
(2) The sections 311-312 hazard categories
would be provided as examples from which
LEPCs and owners or operators could choose
a class or category, or if they believed it to be
necessary, the parties could choose another,
hazard-based class or category which better
reflected the safety Information described
above;
(3) LEPCs and facilities would negotiate a
das* based on chemical- structure.
The proposed rule on trade secrets did
not discuss generic class or category
. determinations for section: 313.
submittals; another alternative was
" adopted by EPA in the final rule for
section 313. The-section 313 proposed
rule stated that owners or operators
should choose .a generic class or
category based on the preassigned class
or category- code for each- chemical
which was set out in the section 313 .
proposed rul& This process was- -
changed in the section 313 final rule to •
allow reporting facilities to-use any
generic class or category that is •
structurally descriptive of the chemical
claimed as. trade secret This change
was made because of the possibility mat
trade secrecy could be compromised
when the preassigned class or category
was cross-referenced with one or more
of the four adverse health effect •
categories provided for the section 313
chemicals in the Toxie Release
Inventory database;
• The comments received on the
alternatives were divided Some of the
commenters wanted EPA to publish a
finite list of classes or categories based
on hazard categories alone, and allow
facilities to choose the appropriate class
or categories. Some commenters wanted
facilities to choose a class-based on
chemical function or chemical structure
without negotiation with LEPCs, State
Emergency Response Commissions
(SERCs), or fire departments. A few
commenters supported the requirement
of negotiation of generic class or
category among the parties involved.
EPA has reevaluated the necessity for
negotiation m choosing generic class or
category and has decided to follow the
process chosen for the section 313 final
rule. Allowing owners or operators to
choose classes on their own based on
chemical structure is preferable to the
options set forth in the proposed rule for
several reasons. First, it will be simpler
for industry, LEPCs, SERCs, and fire
departments than requiring the time-
consuming process of negotiation;
second, negotiation of generic classes
could also be technically burdensome to
LEPCs; and third, this approach will
provide greater consistency for choosing
generic class or category under the
various sections of the law.
Although owners or operators will be
choosing generic classes or categories
on their own, EPA is advising that
classes be chosen following the
guidelines of the Act's legislative
history: The Conference Report directs
that generic class or category be defined
only as broadly as necessary to protect
- the specific chemical identity from
disclosure, and it should at the same
... time reflect the thrust of the law to
transmit chemical information to the
public. Thus, EPA advises that classes
be determined so that information on
the specific chemical identity's release
hazards and adverse health effects are
included in the class or category. As an
example of such a class, volatile
aldehyde is a generic class that is
functionally descriptive of the chemical
acid aldehyde and provides information
on the chemical's volatility.
D. Claims Under Section 311"
As provided in the rule for sections
311-312, when reporting, a submitter of
a section 311 report must submit either
an MSDS for each hazardous chemical
(above a threshold quantity), or a list of
the hazardous chemicals with the
• chemical or common name of each
hazardous chemical as. provided on the
MSDS.
Claims of Trade Secrecy for MSDSs
Submitters must send to EPA a copy
of the MSDS, and an unsanitized and
sanitized substantiation. An explanation
of the substantiation is set forth in
section II.G. below. Claims should be
packaged as described in section II.B.1
of this preamble, and the instructions to
the substantiation form.
EPA is not requiring submitters to
provide an unsanitized version of the
MSDS. The Agency received comments
indicating that most facilities do not
have "unsanitized" copies (i.e.. copies
indicating chemical identities) of MSDSs
on file under the HCS where they have
claimed chemical identity as trade
secret In such cases, facilities have on
file only MSDSs that omit the chemical
names of trade secret chemicals and
instead contain a common name for the
chemical For a facility to supply an
"unsanitized" MSDS—Le., one
containing the chemical identity of a
-------
chemical claimed as trade secret—to
EPA under the section 322 rule, as
proposed, the facility would have had to
modify an USDS that did not previously
Indicate the chemical identity. One
suggestion by commenters was to allow
facilities to attach supplements of their
own design indicating the chemical
identities. EPA decided, however, that
because the information on chemical
identity will be provided to EPA in the
unsanitized version of the substantiation
form attached to the MSDS, a
supplement or unsanitized MSDS is
therefore unnecessary. Hence, EPA is
taking the burden reducing step in the
final rule of not requiring an unsanitized
MSDS (though the requirements for
unsanitized copies of sections 311 lists,
312 Tier U forms, and 313 forma remain
unchanged from the proposed rule).
Three commenters stated that trade
secrecy claims should not be necessary.
under section 322 in cases where a
specific chemical identity has already
been withheld as trade secret on an
MSDS under OSHA's Hazard
Communication Standard. Section 322(a)
states that a person required to submit
information under Title III may withhold
from such submittal the specific
chemical identity. When the specific
chemical identity is claimed as trade •
secret under th'e HCS, the identity does
not appear on the MSDS that the facility
keeps on file under that standard. The ,
commenters argued that because the
identity is not present when these
MSDSs are to be submitted under
section 311, the submitters are not-
"withholding" chemical identity and
thus a claim of trade secrecy under
section 322 should not be required.
EPA disagrees with this argument for
several reasons. First, if a manufacturer
of a chemical were not required to file a
trade secrecy claim under Title ffl
because It had already treated the
chemical as a trade secret under the
HCS, the detailed, upfront
substantiation provisions of section 322
would be circumvented; The HCS allows
chemicals to be treated a& trade secrets-
at the discretion of facilities, provided
the facility can substantiate the secret if
challenged. Congress was more strict in
enacting Title HI in this regard, requiring
that the claim be substantiated at the
time it is made.
Further, under the commentere' view,
the public would be denied the means to
petition for review of the trade secret
claim because no claim would ever have
been made, and no similar option for
review by the general public exists
under the HCS. Therefore, EPA requires
that a claim of trade secrecy must be
filed for section 311 MSDS submittals
even when the chemical identity is
previously withheld from the MSDS as
trade secret under the OSHA HCS. j
Reporting of mixtures on the MSDS is r
discussed below. ,
Claims of Trade Secrecy for the Section I
311 List
The list option under section 311 is ;
structured so that submitters may report ;
either the chemical or common names of
a chemical on the list Submitters :
wishing to claim chemical identity as j
trade secret must submit to EPA an j
unsanitized version of the list which
contains the chemical identity or \
identities which are being claimed. The
submitter must also send a sanitized :
version of the list in which the chemical
identity or identities are replaced with
generic classes or categories. When j
more than one chemical is claimed as a i
trade secret, to avoid confusion the..
order, of chemical names found on the
unsanitized list must match the order of
generic classes or categories found on
the sanitized list As with all other trade '<
secrecy claims under Title HI, submitters ;
must also send to EPA a sanitized and ;
unsanitized version of the
substantiation. Claims should be
packaged as described in section H.B.l
of this preamble and in the instructions !
to the substantiation form. ' ,
Since submitters have the option of .
•reporting chemicals on the section 311 ,
list by either chemical or common name,;
some submitters may believe that even •
with the use of the common name trade
secret chemical identity will be
revealed. In this instance submitters ;
may want to make a claim of trade j
secrecy for the chemical identity.
However, in other instances, as >
commenters noted, the use of the ;
common name may sufficiently protect ;
trade secret chemical identity, and the ;
submitter may decide that no trade :
secrecy claim needs to be filed. LEPCs ;
may later request the MSDSs for the ;
chemicals on the list If the submitter ;
has made no trade secrecy claim for the
chemical on the list (because the use of
the common name sufficiently protected
trade secret chemical identity), but the ,
specific chemical identity is withheld ;
from the MSDS distributed to the LEPC,
then the submitter must, at that time, file
a trade secrecy claim with EPA i
regarding that MSDS. . j
Mixtures Reporting on the MSDS, i
Section 311 List, and Section 312 Tier II
Form • i
For reporting mixtures under sections
311 and 312 (on MSDSs, lists, or Tier U
forms) the submitter may provide the |
required information on each hazardous
component in the mixture, or may ;
provide the required information on the
mixture as a whole.
If a mixture is reported as a whole by
common name on the section 311 MSDS,
section 311 list, or section 312 Tier II
form, no trade secrecy claim needs to be
filed with EPA if the submitter believes
that common name sufficiently protects
trade secrecy. However, if the common
name or other identifier, e.g., CAS
number, insufficiently protects trade
secret chemical identity the submitter
may file a trade secrecy claim. Claims
are to be made in the manner specified
for the MSDS, section 311 list or section
312 Tier II form, whichever is
appropriate.
EPA received some comment on the
question of whether trade secrecy
claims need to be made for hazardous .
components of mixtures reported on the
OSHA MSDS. Commenters indicated
that EPA should consider instances
where tHe specific chemical identities of
hazardous components of mixtures
would be claimed as trade secret on the
OSHA MSDS. These commenters argued
that although OSHA usually requires
hazardous components to be listed on
an MSDS when a mixture is reported as
a whole, section 311 is silent regarding
whether such hazardous components
must be submitted. These commenters, ^
argued therefore, that no trade secrecy
claim needed to be submitted to EPA for
those hazardous components listed on
the OSHA MSDS. EPA believes that
since Congress authorized the reporting
of mixtures as a whole under sections
311 and 312, and since health and safety
data are provided for the mixtures on
MSDSs, no trade secrecy claims need to
be made for hazardous components
when a mixture is reported as a whole.
' Two commenters suggested that to
reduce the paperwork burden on
themselves and the Agency, EPA should
allow trade secret claimants of mixtures
to submit one claim rather than several
claims in the situation where the same
hazardous chemical is present in many
different mixtures. This approach is
permitted in section 311{a)(3) of the
statute, which states that only one
MSDS is required to be submitted for
- each component where the reporting is
on the hazardous component(s) of the
mixture, and not on the mixture itself.
Generic Class or Category
The procedures for determining
generic class or category are outlined in
the Generic Class or Category
subsection of section II.C.
E. Claims Under Section 312
Section 312 requires the submission of
emergency and hazardous chemical
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/ Rules ant! Regulations
inv intory forma. Infonnation filed on the
Tier I emergency and hazardous
chemical inventory form will not involve
claims of trade secrecy since chemical
identity is not requested on the form.
Trade secrecy claims under section 312
may involve only Tier II inventory forms
where the specific chemical identity or
other specific identifier is reported.
Submitters are permitted to report
Tier H chemicals by either chemical or
common names. In some instances, as
commenters noted, the use of the
-common name may sufficiently protect
trade secret chemical identity, and the
submitter may decide that no trade
secrecy claim needs to be filed.
However, some submitters may believe
that even.with the use of the common
name trade secret chemical identity will
be revealed. In this instance submitters
may want to make a. claim of trade
secrecy for the chenucalidentiry.
To make a trade secrecy claim on the -
Federal sectiou312 Tier II inventory
form, the submitter must check the trade
secret box which appears to the right of
the space for chemical identity on the
form. EPA must receive an unsanitized
copy of the form, which will include the
trade secret chemical identity. EPA must
also receive a sanitized version of the
form which must be a duplicate of the
original except thai the chemical
identity will be deleted and in its place
the generic class or category of that
chemical will be inserted. The two
copies should be attached by rubber
band or binder clip (not stapled) to each
other, the unsanitized form on top and *
the sanitizedfonn on the bottom. When
more than one chemical is claimed as a
trade secret to avoid confusion the
order of chemical names found on the
unsanitized Tier E form [the top page)
must match the order of generic classes
or categories found on the sanitized
form. The sanitized Tier H form should
be sent to the requesting State
-emergency response commission, local
emergency planning committee, or fire
department In addition, a sanitized and
unsanitized substantiation must be
included for each chemical claimed as
trade secret a» explained in section
H.G. of this preamble. Claims should be
packaged as described in section ILB.1
of this preamble and in the instructions
to the substantiation form.
A few States have expressed an
interest in using State-designed Tier II
inventory forms rather than the Federal
inventory form. Under § 370.41 of the
final rule for sections .311 and 312,
facilities will meet section 312 '
requirements if they submit the Federal
form, an identical State form, or an
identical State form with supplemental
28783
questions authorized under State law. If
a submitter wishes to make a trade
secrecy claim, however, it must use the
Federal form as its section 312 Tier II
submittaL EPA believes it cannot accept
State forms for this purpose because
State forms may contain additional
information not required under this
Federal law, some of which may be
confidential and EPA does not wish to
accept extraneous confidential materials
requiring confidential handling under
State law. State forms that collect
confidential information under State
right-to-know laws are covered under
State confidentiality laws.
Claims of confidentiality regarding the
location of chemicals in facilities are not
covered by Title m trade secret
protection. The confidential location
information should not be sent to EPA,
but only to the requesting entity. This
information will be kept confidential by
that entity onder section 312(d)(2)(F)
which refers to section.324. Section
324{a) state* that upon request by a-
facility owner or operator subject to the
requirement&of section 312, the State
emergency response commission and
the appropriate local emergency
planning committee most withhold from
disclosure the location of any specific.
chemical required by section 312(d)(2) to-
be contained in a Tier H inventory form.
Thiff process of confidential treatment of
location information is separate from
the process for treatment of trade secret
information contained in the nile for
section 322.
G. Initial Substantiation
F. Claims Under'Section 313
Trade secrecy claims under section
313 must include a copy of the toxic
release inventory form. This form is
published at 53 FR 4540. The submitter
must check the box on,the form
indicating a trade secrecy claim and
include a generic class or category. This
generic class or category must be
structurally descriptive of the chemical
claimed as trade secret as described in
the Generic Class or Category '
subsection of section II.C. of this
preamble.
EPA must also receive a sanitized
copy of the toxic release inventory form
which is identical to the original except
that the chemical identity will be
deleted, leaving the generic class or
category. A substantiation for each
claimed chemical identity must also be
submitted^ as described in section H.G.
below. Claims should be packaged as
described in section ILB.1 of this
preamble and in the instructions to the
substantiation form.
Section 350.7 of the proposed rule
required that all claims of trade secrecy
must be substantiated by the claimant
providing specific answers to seven
questions set forth in the section. The
answers to each of the questions posed,
or an explanation as to why that
question is not applicable, were to be
provided on the substantiation form in
§ 350.27 and to accompany the
submission. The questions posed in the
rule (and the identical questions on the
form) were based on the four statutory
criteria in section 322(b) of Title III and
are intended to elicit from a submitter
all the information necessary to fulfill
the statutory criteria.
The information submitted in
response to these questions is the basis
for EPA's initial determination as to
whether the substantiation is sufficient
accordmg to the statutory criteria to
support a claim of trade secrecy.
Consequently, the role of the initial
substantiation in the trade secret
protection process as well as the
specific language of individual questions
asked under § 350.7{a) received
considerable comment.
A description of the relationship
between the .rule and the statutory
scheme is as follows. The first decision
EPA must make after receiving a
petition to disclose trade secret
chemical identity or after initiating such
a decision on its own concerns the
sufficiency of the trade secret claim, that
is, whether, assuming all assertions
made in support of the claim are true.
the assertions are sufficient to support a
claim of trade secrecy for the chemical
identity. EPA must make this
determination of sufficiency based
solely on the information which the
trade secret claimant submits in the
substantiation included with its Title III
submission. See section 322(d)(2). It is
only when a submitter's claim is deemed
sufficient that it is entitled to
"supplement the explanation with
detailed information to support the
assertions." See section 322(d)(3)(A).
Then. EPA is to determine whether the
"assertions in the explanation are true
and the specific chemical identity is a
trade secret" See section 322(d)(3)(B).
A major concern of several
commenters was that the initial
substantiation requirements were too
detailed and burdensome, and that they
undercut the statutory scheme noted
above. Commenters argued that
Congress clearly intended to establish a
two-step process for substantiation of
trade secrets, as expressed in section
322(d)(3)(A). The commenters asserted
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28782 Federal Register / Vol. 53. No. 146 / Friday. July 29. 1988 / Rules and Regulations
that the proposed rule blurred the
distinction between the two-step trade
secret substantiation process by
requiring the "detailed information"
Initially.
The commenters proposed several
options to remedy their concerns. The
commenters argued that claimants
should be allowed to make assertions in
the initial substantiation and that details
supporting the assertion need only be
supplied when a third party files a
petition for disclosure. One commenter
argued the foregoing point by stating
that EPA should merely'accept the
assertion by a submitter that
competitive harm will result if an
alleged trade secret is made public—no
up-front substantiation should be
required for that particular assertion,
and only upon challenge would a
substantiation bs required. The
commenter felt that this option would
assist a company in meeting filing
deadlines because the time-consuming
substantiation form would be delayed
pending a challenge to the claim.
EPAhas carefully considered the
commenter's statements. One approach
that was considered, though not
adopted, was, instead of utilizing the
proposad form, listing the four statutory
requirements as set forth hi the statute ;
and requesting the submitter to verify
that it believes it has met these
requirements. The Agency chose not to
adopt this method because of concerns .
that responses might not include the
specific facts necessary for EPA to
evaluate the sufficiency of a trade secret
claim, as Congress required in the
statute. , , , ,
The Agency has concluded that while
Congress did not intend the information
collected up-front to consist solely of
conclusory statements parroting the four
criteria of trade secrecy set forth in the
statute, neither was an overly detailed
information collection intended, which
could prove unduly burdensome. EPA
has sought to strike a balance between
these two extremes.
In striking this balance, the Agency
has decided to make some changes in
the rule as proposed (and discussed
below), in order to lessen the amount of
detail required in the up-front
substantiation, so that the reporting
burden is not so great More specific
additional details may still be requested
as supplemental information.
The Agency iiaa also revised
1350.7(a) (Substantiating claims of trade
secrecy) and the substantiation form to
state that a submitter must assert
"where applicable" specific facts. This
change Is intended to reduce uncertainty
as to when detail is required and to
relieve claimants of the burden of
having to certify as true speculative
statements or negative conclusions,
which commenters pointed out as a
problem with some of the questions as
proposed. EPA is concerned that
adoption of this change might encourage
claimants to not provide specific detail
in many cases where their assertions
require it; the change is not intended to
relieve submitters of this responsibility.
The comments also raised issues
concerning several of the individual
questions or sub-parts to questions,
proposed in § 350.7(a), and these are
discussed individually below.
Question 1. The question as proposed
read: "Describe the specific measures
taken to safeguard the confidentiality of
the chemical identity claimed as trade
secret."
Two comments were received
concerning the text of Question 1. These
comments stated that the question
requested information, not required by
the AcL^Jowever, the Agency disagrees
since the statute in specific terms
requires this information. Basic to the
law of trade secrets is the requirement
that the owner of a trade secret has
•taken steps to protect the secret from
disclosure. Therefore, the question is a
necessary and required first inquiry in
determining whether Jtrade secret •
protection is- warranted for the1 specific
chemical identity.
.The Agency also received comments
that proposed Question 1 did not request
all the information specifically required
by section 322(b) of the statute; that is,
whether the submitter intends to
continue taking measures to safeguard
its trade secret information. The
commenter also noted that this
information was expected under the
sufficiency criteria. (See discussion of
sufficiency criteria below under section
IV.C.) The Agency agrees with the
commenter that such information is
required, and has revised Question 1
accordingly.
Question 1 has been revised to read
• as follows: "Describe the specific
measures you have taken to safeguard
the confidentiality of the chemical
identity claimed as trade secret, and
indicate whether these measures will
continue in the future."
FULUIEAG *** UftW *»•»»»»«•
Question 2; The question as proposed
read: "Have you disclosed this chemical
identity to any person not an employee
of your company or of a local. State or
Federal government entity, who has not
signed a confidentiality agreement
requiring them to refrain from disclosing
the chemical identity to others?"
Section 350.7(a)(2) and Question 2 ask
whether the submitter has disclosed the
chemical identity to any person not a
company or government employee who
has not signed a confidentiality
agreement. The one significant comment
pn the question noted that the proposed
regulation specifies a signed
jconfidentiality agreement, whereas, the
statutory language upon which this
Question is based requires persons
claiming a trade secret to show that
persons dealing with the alleged trade
isecret are "bound by a confidentiality
iagreement." The form of the agreement
:is not specified. The commenters cited
I State law, common law, and custom as
! establishing that unwritten trade
secrecy agreements are enforceable.
i EPA agrees with the commentera that
Congress did not specify that the
i confidentiality agreement must be a
written document. Indeed, the purpose
i of the question is to ascertain whether
; there exists a confidential relationship
between a submitter and other parties
i that would prevent disclosure. The
; threshold test for a confidentiality
i agreement is whether it is legally
j enforceable. Although having a written
agreement, as proposed, simplifies
' substantiation of the fact that the
information was treated as a trade
' secret and steps were taken to secure its
i secrecy, EPA agrees that the
! requirement for a written agreement is
I not specified by Congress and the intent
i of the requirement can be met without a
writing.
i One minor comment was received
' which did not require any change in the
! rule. Several commenters cited to
; situations in-which a trade secret is
inadvertently disclosed; however, the
i company does not sustain an injury
! because the error is corrected before the
• trade secret falls into the hands of a
! competitor. They requested that
' Question 2 of the Proposed Form be
; expanded to allow for explanation of
inadvertent or mistaken disclosures that
i were promptly corrected or retrieved
i before competitors became aware of the
j disclosure.
! The Agency does not believe that any
• change in the form or question was
i necessary in response to this comment.
The submitter must answer
; affirmatively to Question 2, but then
should attach an explanation. EPA will
: consider the explanation in the context
of all the other steps the submitter has
1 taken to protect the trade secret.
'• EPA has deleted the reference to a
: "writing" in the final § 350.7(a)(2) and
Question 2. The final Question 2 reads:
"Have you disclosed the information
claimed as trade secret to any other
person (other than a member of a local
emergency planning committee, officer
or employee of the United States or a
State or local government, or your
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y''23' 198a f Rules'. and Regulations
28783
employee) who is not bound by a
confidential^" agreement to refrain from.
disclosing - trade secret to others?"
This formulation of the question avoids
the double negative in the proposed
question about which some commehters
complained.
Question 3. The question as proposed
read: "List all local, State, and Federal
government entities to which you have
disclosed the specific chemical identity.
For each, indicate whether you asserted
a confidentiality claim for the chemical
identity and whether the government
entity denied that claim."
One commenter thought that the
question did not address situations
where information deemed
"confidential" is often submitted to the
government and the claim left
unchallenged, without a determination
of the claim's validity. The commenter
stated that even if the claim is not
expressly, denied, it is possible that the
confidentiality claim would be denied if
eventually reviewed. ' .
. In this question, EPA is attempting to
ascertain the submitter's efforts to
protect its trade secret The most
important elements of this question are
whether chemicalidentity was.
previously claimed as trade:secret and ,
whether the claim was ever denied. If •-.- •..
the .claim of trade secrecy was. denied
and the chemical identity, .therefore
made public, the submitter would not be; .
able to meet the statutory test for .
confidentiality. Therefore the Agency
will not revise Question 3 to include the
question of whether the submission was
reviewed under the other authority.
Several commenters questioned
whether an explanation should be
permitted in instances where there is a
qualified or partial grant of.
confidentiality by a government entity,
or of where a prior determination does
not affect the current claim. One
commenter stated that Question 3 does
. not consider the potential situation of a
qualified or partial grant of ...
confidentiality by a government entity, ••
since the question does not request an
explanation in the event that a
particular government entity has denied
a trade secrecy claim. The commenter
asserted that there may be
circumstances in which a partial or total
denial of the claim should not adversely
affect the claim being made under Title
• III. A second commenter observed that
the fact that the specific chemical
identity of a chemical has been
disclosed hi some context in the past
should not result in forfeiture of trade
secret status if the disclosure was not
tied to the specific Title HI information .
that is at issue..
Another aspect to this issue is raised
by a third commenter who alleged that
Question 3 does not take into
consideration the trade secret status of
chemicals whose identity may have
been disclosed to a government agency
under circumstances where the
confidential connection to the
submitting firm remains undisclosed.
Specifically, the commenter cites to the
nonconfidential Toxic Substances
Control Act (TSCA) inventory where'
specific chemical substances are
reported without claims of
confidentiality because the inventory is -
compiled in such a manner as not to link
a chemical with a firm.
The Agency must collect information
on whether the submitter has disclosed
the information claimed as trade secret
to a State, local or Federal agency,
including previous disclosures to EPA
under Title m or other statutes, and the
steps the submitter took to protect this
data. In doing so, the Agency, is also-
attempting to discover whether there
has been a public disclosure of the '
information. Submitters who believe it
necessary to explain special
circumstances may do so. The Agency
also wishes to point out that it is
'sometimes possible to fink specific
chemical'substances with the reporting
firm under the non-confidential TSCA
inventory. The submitter must have
claimed the information reported as
confidential to assure that there is no
link under the inventory.
One commenter stated that if
"disclosure" was defined too broadly it
would negate the intent of the
Community Right-to-Know aspect of
Title IIL A company might be reluctant
to share information with an LEPC to
avoid being held to have disclosed the
trade secret However, the commenter's
discussion seemed to indicate that the
information being provided to the LEPC
would be health and safety data, not the
specific chemical identity which
constitutes the trade secret Therefore,
the situation described by the
commenter would not constitute a
disclosure of the trade secret; and the
Agency has decided that no revision to
the final rule is necessary to respond to
this comment
Question 4. Proposed § 350.7(a)(4) and
Question 4 require trade secret
claimants to substantiate the harm to
their competitive position that would
result from disclosure of the information
claimed as trade secret The proposed
Question 4 provided:
(1) In order to show the validity of a trade
secrecy claim, you must identify your specific
use of the substance claimed as trade secret
.and explain why it is a secret of interest to
competitors. Therefore: . ."...,
[a] Describe the specific use of the
chemical substance, identifying the product
or process in which.it is used. (If you use the
substance other than as a component of a
product or in a manufacturing process.
identify the activity where the substance is
used.)
(b) Has your company or facility identity.
been linked to the specific chemical identity
of the substance in publications or other
information available to the public (of which
you are aware}? Q Yes D No. Is this linkage
known to your competitors? O Yes Q No. If
the answer to either question is yes, explain
'why this knowledge does hot eliminate the
justification for trade secrecy.
(c) If this use of the substance is unknown
outside your company, explain how your '
competitors could deduce this use from
disclosure of the chemical identity together
with other information on the form.
(d) Explain why your use of the substance
would be valuable information to your
competitors. .
Several commenters asserted that it is
unreasonable for the Agency to require
claimants to characterize their
competitors' knowledge of the
information claimed to be trade secret,
as in-Questions .4 (b) and (c). They
argued that it is impossible to.state what
someone else knows, and that the
inability to provide an accurate
assessment pf what competitors know
should not endanger a trade, secret
claim. This requirement was also
claimed to be inconsistent with the
common law of trade, secrecy* which
does not require a trade secret claimant
to show the knowledge, motivation, or
capabilities of its competitors in order to
avoid forfeiture of a trade secret.
Moreover, commenters argued, a
substantiation .should not be determined
insufficient on the basis that a
competitor is aware of the claimant's
use of a substance. As long as the
information confers an advantage on the
firms that do know it and it is treated as
a secret by each of them, the
information should qualify for trade
secret status. Finally, one commenter
went so far as to suggest that any
reference to competitors' knowledge
should be deleted altogether.
The problem of requiring claimants to
assert facts concerning the knowledge of
competitors is related to a more general
complaint of commenters that the
criteria of proposed § 350.7 tended to be
phrased as "negative conclusions," and
thus were difficult to prove. Commenters
asserted, that these provisions would
place claimants in the untenable
position of being required to certify the
accuracy of statements that cannot be
anything more than speculation.
Commenters are correct in stating that
trade secrecy claimants should not be
required to certify to the truth of
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28784
Federal Register / Vol. 53, No. 148 / Friday. July 29.1988 / Rules and Regulations
speculative statements. It is also true
that more than one person can claim
trade secrecy protection regarding the
same information. Nevertheless, one of
the factors that the Agency must
consider in determining whether •
information is a trade secret Is the
extent to which the information is
known outside of the claimant's
business. Therefore, claimants should be
required to address their competitors'
knowledge if they know whether such
knowledge exists.
Accordingly, the Agency has revised
§ 350.7(a]{4) and Question 4 to require
claimants to characterize their
competitors' knowledge of the
information claimed as trade secret, to
the extent that they know whether such
knowledge exists.
One commenter also stated that the
term "substance" is used for the first
time in substantiation Question 4, is not
defined, and therefore is ambiguous. The
commenter suggested that EPA define
the term or, preferably, replace it with a
term that is already among the term*
used in the rule. In order to conform
Question 4 with terminology used
throughout the rule. EPA has replaced
the term "substance" with the phrase
"chemical claimed as trade secret" in
the final rule.
Several individual questions within
Question 4 also received comment, and
are discussed in order.
Question 4(a). This question asks the
submitter to describe the specific use of
the chemical substance, identifying the
product or process in which it is used.
One commenter suggested that EPA
delete the term "specific" as it relates to
the use or process of the chemical being
described because no more than a
general description is necessary here.
The commenter also asked the Agency
to clarify that a facility need only
provide process or use information that
Is relevant to the claim being made, Le.,
that the claim of trade secrecymay not
relate solely to the use of the chemical,
but may relate to other factors.
EPA disagrees with the commenter on
the specificity of use information that is
required. Such information is always
relevant to a trade secrecy claim.
Although information regarding use may
not always be sufficient, standing alone,
for the Agency to determine the validity
of a trade secrecy claim, it is necessary
information in the Agency's evaluation
of the claim which should, together with
other required Information, enable the
Agency to make the determinations
required by Title EL Accordingly. EPA
has retained the requirement for
Information regarding the specific use hi
the final rule, but has revised
§ 350.7(a](4)(i) and Question 4(a) to -
substitute the term "chemical" for !
"substance" (as explained above). \
Question 4(b). This question asks
whether the company or facility identity
has been linked to the specific chemical
identity of the substance in publications
or other information available to the
public and whether this linkage is j
known to competitors. The one comment!
received suggested that the subquestion,'
"Is this linkage known to your !
competitors?", should be deleted, . :
because the claimant cannot know the \
answer, making it speculative. Further, ;
the commenter stated that even if the - •
linkages were known by a competitor,
this would not necessarily render the' ;
trade secret invalid. ;
As discussed above. EPA agrees that
the knowledge of competitors may not
be known. EPA has amended the final i
rule to reflect this change. In addition,
EPA added a reference; to patents in this
question* which are a subset of
publications. The discussion under
Question 7 describes in detail the
reasons why the'requirements of the ;
substantiation dealing with patents can
be adequately addressed in the modified
Question 4{b). Therefore, in the final ;
rule, § 350.7(a)(4)(ii) and Question 4(b) i
have been revised to read as follows: !
"Has your company or facility identity !
been linked to the specific chemical j
identity claimed as trade secret in a *;
. patent, or in publications or other >.
information sources available to the i
public or your competitors (of which you
are aware)? If so. explain why this |
knowledge does not eliminate the I
justification for .trade secrecy."
Question 4(c). The question asks the \
submitter to explain how competitors ;
could deduce a trade secret use from
disclosure of the chemical identity
together with other information on the '
reporting form. One commenter stated ,
that this question should be deleted as !
speculative. The commenter argued that
if chemical identity as' related to use :
could be deduced from other i
information on a Titie m submission,. '
there would hardly be reason for the [
claimant to incur the time and expense .
of submitting a trade secrecy claim. j
Another commenter argued that this i
question and Question 4(d) (discussed •
below) appear to be more appropriate ;
for substantiating claims of use >
confidentiality than.chemical identity j
confidentiality. The commenter argued !
that a competitor may be able to [
determine information on a generic ]
basis sufficient to recognize the specific;
information it needs in order to learn the
trade secret The commenter stated that;
a company should be able to protect !
itself from future competitors as well as;
present ones. . >
The Agency is not persuaded by
comments that Question 4(c) should be
dropped from the substantiation that
must be provided by each claimant."
Regarding the supposed distinction
between use confidentiality and
chemical identity confidentiality, the
two concepts are not mutually
exclusive. Rather, information on the
use of a chemical is necessary to
determine the validity of a trade secrecy
claim as to the identity of that chemical.
The final rule, however, contains a
revision of § 3S0.7(a)(4)(iii) and Question
4(c) that substitutes "chemical claimed
as trade secret" for the term
"substance."
Questioned). The question requires
the submitter to explain how his use of
the substance would be valuable
information to competitors. One
commenter asked the Agency to clarify
that submitters are not required to
include a.dollar estimate in their
statement of "value," particularly since
such an estimate would be speculative
and, therefore,, would not be certifiable
as a "specific fact" Another commenter
suggested that this question be revised
to read, "Explain why the information
for which chemical identity is being
claimed trade secret would be valuable
information to other business entities."
This commenter stated that it is not only
"competitors" but other business
entities, that could use trade secret
information to the detriment of the
claimant
First EPA does not intend for
submitters to provide a dollar estimate
as the sole measure of value in Question
4(d). Such a requirement would indeed
put submitters in the position of
certifying what could be highly
speculative information. Reasonable
dollar estimates may be worthwhile in
the final determination, and may be
requested as supplemental information.
Second, the law of trade secrecy refers
to "competitors," not "other business
entities," as the universe of entities
against whom trade secrecy protection
applies.
The only change that has been made
to § 350.7(a)(4) and Question 4(d) in the
final rule has been the substitution of
the term "chemical" for the term
"substance."
The final version of question 4 reads:
"In order to show the validity of a trade
secrecy claim, you must identify your
specific use of the chemical claimed as
trade secret and explain why it is a
secret of interest to competitors. •
Therefore:
(i) Describe the specific use of the
chemical claimed as trade secret
identifying the product or process in
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28785
which it is used. (If you use the chemical
other than as a component of a product
or in a manufacturing process, identify
the activity where the chemical is used.)
(ii) Has your company or facility
identity been linked to the specific
chemical identity claimed as trade
secret in a patent, or in publications or
other information sources available to
the public (of which you are aware}? If
so, explain why this knowledge does not
eliminate the justification for trade
secrecy.
(iii) If this use of the chemical claimed
as trade secret is unknown outside your
company, explain how your competitors
could deduce this use from disclosure of
the chemical identity together with' other
information on the Title DI submittal
form.
(iv) Explain why your use of the
chemical claimed as trade secret would
be valuable information to your.
competitors." . . . '
Questions*The proposed Question 5.
read: "Indicate the nature of the harm to
your competitive position mat would
likely result from disclosure of the
specific chemical identity, including an
estimate of the potential loss of sales or
profitability.".
Two commenters stated that an
estimate of the potential loss of sales or
profitability should not be required. One
of these commenters asked EPA to
indicate in the Preamble to the final rule
that detailed information need not be
submitted in response to this question at
the time of an initial submission. The
commenter stated that this question
would be time-consuming due to the
amount and diverse sources of
marketing and other data required to
provide an accurate estimate.
A more detailed estimate of the
potential loss of sales or profitability
may be more appropriate as part of a
supplemental substantiation (at which
time EPA assesses the factual accuracy
of the submitter's assertion). The
purposes of an initial substantiation
may be fulfilled by requiring a
description of the nature of harm to
competitive position that may result
from trade secret disclosure, and an
explanation of why such harm would be
substantial. EPA agrees with these
commenters, and has dropped the
requirement to develop a loss of sales
estimate as part of the initial
substantiation.
One commenter requested that EPA
recognize that trade secrets developed
by "serendipity" are protectable under
section 322 of Title in. The commenter
noted that although the submitter may
not have gone to any great expense to
develop the trade secret, the secret
nevertheless may be of great value to -
the submitter. This is consistent with the
intent of the statute and the sufficiency
criteria described hi the final rule. The
costs discussed in the rule relate to the
cost to a competitor of replicating the
information, not to the owner of the
information in developing it originally.
Although information will not be
protectable as trade secret if it is readily
available public knowledge, nothing will
prevent the protection as trade secret
information which the claimant has
discovered with minimal effort by a
stroke of good fortune.
Accordingly, EPA has revised
§ 350.7(a)(5) and Question 5 to read as
follows: "Indicate the nature of the harm
to your competitive position that would
likely "result from disclosure of the
specific chemical identity, and indicate
why such harm would be substantial."
Question 8. The proposed question 6
read: "To what extent is the substance
available to the public or your
competitors in products, articles, or
environmental releases?
Describe the factors which influence
the cost of determining.the identity of
the substance by chemical analysis of
the product, article, or waste which
contains the substance (e.g., whether the
substance is in pure form or is mixed
with other substances), and provide a •
rough estimate of that cost"
The issue of discovery of a chemical
by reverse engineering arises in
Question 6 of the substantiation form,
§ 350.7{a){6}, although the term "reverse
engineering" is not mentioned in the
question. This section of the
substantiation is derived from the fourth
statutory criterion (that chemical
identity is not readily discoverable
through reverse engineering) and the
question requires answers that reflect
on whether the trade secret claimed can
be reverse engineered.
Most comments regarding reverse
engineering focused on the difference
between the proposed rule's use of the
term' "reasonably learn" as opposed to
the statutory term "readily
discoverable" as the appropriate
standard of sufficiency for evaluating a
chemical's susceptibility to discovery by
reverse engineering. Commenters
generally objected to the proposed rule's
use of the term "reasonably learn",
primarily on the basis that it would
provide less protection for trade secrets
than would the statutory standard
"readily discoverable." The statutory
term was also favored because it is a
generally accepted and understood term
employed in analytic chemistry, while
"reasonably learn" is not
Most commenters who addressed this,
issue explained that given sufficient
time and ample resources, the discovery
of almost any chemical by reverse
engineering would be considered
"reasonable." The commonly
understood def-'tion of the summary
standard, on the other hand, takes into
account whether the time and resources
necessary to successfully reverse
engineer a product are readily available.
Conversely, one commenter supported a
definition that would deny trade secret
protection if an identity is at all
discoverable by re verse, engineering.
Essentially, the reasonably learn
versus readily discoverable issue is a
matter of terminology. The Agency's
choice of the term "reasonably learn" in
the proposed rule was derived from the
statute's directive in section 322(c) that
the regulations regarding reverse
engineering be "equivalent to
comparable provisions" in OSHA's :
Hazard Communication Standard, and
any revisions to the HCS required by
United States Steelworkers v. Auchter,
783 F.2d 728 (3d Cir, 1985).
The definition of trade secrecy in the
HCS was determined by the Auchter
court to be-legally deficient with respect
to determining the legitimacy of trade
secret claims because it failed to
- account for a chemical's susceptibility to
reverse engineering. The revised HCS
accordingly adopted the Restatement's
definition of trade secret as an
appendix, which requires consideration
of the ability of others to discover the
secret bylegitimate means, including
reverse engineering.
It is apparent from these revised
OSHA regulations, as well as from the
Restatement's definition and applicable
case law, that the generally understood
meaning of "readily discoverable" by
reverse engineering requires that the
chemical identity at issue be
discoverable using readily available
equipment, generally known analytic
techniques, and that the required costs,
time, and resources are reasonable
considering the benefits derived. This is
the standard the Agency intended by its
initial choice of the "reasonably learn"
language. The Agency also intended.
with the use of this language, to avoid
denying trade secrecy claims on a
purely theoretical ability to reverse
engineer, since this would disregard the
costs involved.
The Agency has replaced the term
"reasonably learn" with "readily
discoverable." This standard is
consistent with the revised OSHA HCS
and the holding of Auchter. as directed
by section 322(c). In order to avoid any
confusion about the applicable
standard, and to make it as consistent
as possible with the HCS, the Agency
has also adopted the Restatement -
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287B8 Federal Register / Vol. 53, No. 146 / Friday, July 29. 1988 / Rules and Regulations
defnitlon of trade secret as an
appendix.
These changes should be recognized
as changes in terms solely for the
purpose of promoting clarity; it does not
indicate a substantive change in the
standard.
Commenters also perceived other
practical and legal problems arising
from the proposed trade secret
definition with respect to reverse
engineering. Section 350-7(a)(6) and
Question 6 of the proposed rule
requested trade secrecy claimants to
"provide a rough estimate of [the] cost"
of determining the identity of the trade
secret substance through reverse
engineering. The development of such
cost estimates was considered useful by
consider in determining whether a trade
secret is readily ascertainable by
reverse engineering! Commenters
nevertheless pointed out difficulties,
such as that developing a prccstimate of
the costo to reverse engineer would be
speculative owing to the uncertainties of
analytic chemistry, and that the costs
wUl vary widely from company to
company for analysis of similar
chemical compounds because of
differences in available resources and
equipment and in the level of training
and sophistication of those conducting
the analyses.
Definitional problems were-also
raised, such as whether the cost
estimate should include costs other than
those to conduct the chemical analysis
(i.e., the costs to develop and replicate
the product once the chemical
constituents have been identified), and ,
whether the estimates should include
the cost of the necessary equipment
Commenters also noted that the
uncertainty of reverse engineering costs
contributes to the trade secret's
protection, since unknown costs may
influence a competitor's decision not to
undertake such an analysis.
The concerns regarding the possible
compromise of trade secret protection
by providing an estimate of the costs to
reverse engineer seem to be the result of
some confusion about the rule's
requirements. If cost information is itself.
confidential information that
information may be claimed as such on
the trade secret substantiation.
Nevertheless, trade secret law
requires some indication of the cost to
discover the trade secret in order to
Jetermine the validity of the claim. If the
cost of Identifying the trade secret by
reverse engineering exceeds the value of
the trade secret itself, the trade secret is
not considered to be readily
discoverable. However, as one
commenter correctly pointed out, cost is
an inexact proxy for the pertinent
factual determination of whether the
trade secret is disclosable by reverse
engineering. The variation in resources
available to different companies also
makes dollar comparisons difficult,
thereby lessening the value of dollar-
specific estimates.
While it is impossible to determine
the ease or difficulty of reverse
engineering without considering the •
costs and equipment involved, it is
apparent that the requirement to
develop specific dollar estimates will
not appreciably further the inquiry at
the initial stage of substantiating a trade;
secret under Title ffl. More useful to the
analysis are the descriptions of the
factors influencing the cost of
identifying the substance sufficient to i
disclose the trade secret through
chemical analysis. Accordingly, the
Agency in the final rule has deleted the
requirement to provide a "rough cost
estimate" of the costs of reverse '
engineering in the substantiation form,
but has retained the requirement- to ;
provide a description of the factors that
influence the costs of analysis. ;
Claimants may still be requested to
develop cost estimates as supplemental i
information following the initial review
of the substantiation. The descriptions
of cost factors in the substantiation must
be as specific and detailed as :
practicable and should include ;
information regarding the level of
expertise needed, the type of equipment
required, the time involved, and so forth.
It is in the submitter's best interest to
provide a well-detailed description of '
those factors that are indicative of cost,
so that the Agency can make a realistic;
appraisal of this express statutory '•
criterion. The failure ,to provide a !
sufficiently detailed description will
likely jeopardize a trade secrecy claim.
Section 350.7(a)(6) and Question 6 of ;
the trade secret substantiation form :
request information regarding the trade
secret chemical's availability in both
final products and in environmental :
releases. Commenters objected to the
requirement to assess availability in
environmental releases, citing myriad '•
practical problems attendant to
analyzing waste streams, such as the ;
extent to which a waste flow may be
treated prior to discharge, varying flowr
rates, dilutions, unintended reactions, ',
the presence of impurities, and similar :
factors. These factors are asserted to ,
make it economically impractical to
conduct such a chemical analysis, and.'
to adversely affect the ability of ',
presently-available technologies to '
detect the chemical at all. :
• The Agency recognizes that, as a i
practical matter, the likelihood of ;
successfully identifying a chemical
present in facility wastes is less than the
likelihood for analysis of a finished
product available on the open market.
Nevertheless, the assessment of whether
the chemical identity is discoverable in
a waste stream or release is not
significantly different from the same
assessment for the discoverability of a
chemical present in a product available
to the public or competitors. The salient
question is, given the compound or
mixture under scrutiny, can it be readily
reverse engineered to identify the
chemical that is claimed as trade secret.
In order to address those cases in which
a release is of sufficient purity such that
the chemical is susceptible to discovery
through reverse engineering, or where
technological advances make such
analysis feasible, this factor has been
retained in the final rule.
Commenters also suggested that
presumptions be established against a
product's susceptibility to reverse
engineering in certain cases. However,
because assessing whether a "secret"
can be discovered by reverse
engineering or other investigatory
method is fact-specific and often a
unique inquiry, the Agency does not
believe that a decisionmaking process
punctuated by presumptions in lieu of
specific fact-finding is useful or
• appropriate.
One commenter questioned whether a
history of disinterest on the part of
competitors in the trade secret chemical
should be taken into consideration in
determining whether a chemical is
discoverable by reverse engineering.
EPA agrees that a history of disinterest
in a claimant's product is relevant to a
trade secret claim, as it is some
indication that the secret is not
generally known to competitors. The
history of disinterest may also be some
indication that the chemical is not
susceptible to reverse engineering, but it
cannot be considered dispositive.
The final question 6 reads: "(i) To
• what extent is the chemical claimed as
trade secret available to the public or
your competitors in products, articles, or
environmental releases? (ii) Describe the
factors which influence the cost of
determining the identity of the chemical
whose identity is being claimed trade
secret by chemical analysis of the
product, article, or waste which contains
the chemical (e.g., whether the chemical
is in pure form or is mixed with other
substances)."
Question 7-. The proposed question 7
read: "Is your use of this substance
subject to any U.S. patent?
If so, identify the patent and explain
why (A) it does not connect you with the
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/ Vol 53, No.46ri&y,. Jaly 29T1988. / Rules and Regulations
substance and (B). why it does, not
protect you from competitive-harm. ,,;
Patent Numbefe--Li—_____ : ig
The commehlecs raised several issues
concerning the patent question. First -
they pointed out that a patent is a
"publication,"" and., as such, is covered
by Question 4 ia the substantiation.
Next, the commenters described several
situations in which, a patent would not
reveal the trade secret, for example, the
specific identify of the valuable
substance is buried in a large listing of
substances, or the use- of the identified
substance is the trade secret (Lew the
linkage is the trade secret). Also, the
commenters feared that a "yes" answer
to Question 7 would disqualify the claim
for trade secret protection, even though
trade secret protection and patent
protection are not identical.
Merging Question 7 into Question 4pif
satisfies many of the commenter's
concernss-Queation 4(n'j now expressly-
considers patent*, as we!? as any other; '
pubfitMtienav far the relevant context of -
whether the publication-of the chemical
identity efimmatea the sobrnftter's date
for trade secret protection;
The second issue under Question 7
that must be-addressed is why patent
protection doea not adequately protect
the claimant front competitive- harm;
Eliminating- Question- 7 does* not leave
this issue-, unaddressed because of its
merging into Question 4(ii) and because
the Agency- intends- to gather additional
detail on this' issue in supplemental
question* to the submitter.
EPA has determined that the
substance of Question 7 can be •
adequately addressed ia Question 4(i%
on publications, and Question 5 on
competitive harm. Therefore, Question
4(ii) has been: amended to specifically
reference patents, in. the final rule,
&35a7(a}(4}{ii) and Question 4(ii) reads
"Has; your company or facility identity
beere linked to the specific chemical
claimed as trade secret ia a patent or. in
publications or other information
sources available to the public or your
competitors (of which you- are- aware)? If
so, explain why this knowledge does not
eliminate the justification: for trade
secrecy."
Finally, commenters raised a question
about the requirement in the proposed
rule;, in 5 350,5(g>, that trade secrecy
claims with missing substantiations or
lacking a response to each question .
would be rejected without notice to the
submitter, and the chemical identity
would be made available to the public. *
Various, commenters criticized this.
provision as unduly harsh, and noted
that various circumstances could occur,,
such as clerical errors or explanations-
being separated from the substantiation-
forms whisk could result in. EPA
„, receiving an incomplete substantiation.
t EPAagreeaand accoritingry, this
(,- provision, has been deleted; However, if
a company's submissions indicate a
disregard for the rule's requirements,
EPA will consider this in evaluating
whether a claim is frivolous.
H. Substantiation Farm
A discussion of the comments on and
changes to each of the questions on the
substantiation, form is found in. section
II.G. above; The form itself is designed
to provide, sufficient space foe
submiitera to succinctly answer each
question. The Agency is looking only foe
specific facts, briefly stated within the
space permitted-to indicate that the
submitter has met the prima facie
> threshold of trade secrecy-If submitters
believe it necessary to make an
attachment, they-may, although such
instances shoal A be rate-Additional
more extensive facts: can be gathered in
the supplemental round of questions.
The Agency also received several-
public comments oat the certification..
statement included at the bottom of the
form. The preamble of the proposed rule.
required that a corporate officer sign the
certification; form.Several cdmmenteis
suggested this was unduly burdensome
in a large corporation because the
officer would be required to handle a"
large number of submissions and would
not have-personal: knowledge about the
information contained, ia <«tch
submission. A few commenters also
suggested that the word "immediately"
should be deleted from the phrase
"based on my inquiry of those
individuals immediately responsible for
obtaining the information" because
large-corporations would have an
intermediary between the person-
gathering the information and the signer
of the certification. Also, the
certifications for sections 312 and 313 do
not- contain this- language.
EPA has added a definition of "senior
management official"1 to § 350.1 of the
rule. The certification: form must now be
signed by an owner, operator ora senior
management official The Agency
believes this requirement balances the
commenterta concerns of burden on the -
• corporate officer who may not have
personal knowledge of the information -
with the need to assure high level
responsibility for the information on the
substantiation form, hi accordance with
Congressional intent. The Agency
accepts the commenters' reasoning
concerning the word "immediately" in
the certification and has deleted the
word in this final rule. " .
EPA received comment requesting the
deletion of the last tw* sentences of the
certification statement. The two-tiered
, substantiation process described in
1 section n.G. allows thetsubmitter to
supply and the Agency to request more
factual information concerting the trade
secret substantiation. EPA is not
requesting that the up-front
substantiation contain as much detail as
was originally proposed, thus there must
be additional details for some of the
questions available upon request. This
requirement will not be deleted.
The last sentence of the certification
concerns the penalty for a frivolous
claim. One commenter requested that
the Agency not interpret the certification
requirements to provide a basis for
asserting individual liability against
corporate officers. EPA will not delete
this provision; however, the language
has been modified. In most cases, the
company^ not the individual signer,
would be liable for the civilly or
administratively, imposed penalty. In
addition, knowingly providing false or
misleading statements to the United
States government is a criminal offense
under 18 U.S.C 1001. and language to
this effect has been added.
One commenter requested
clarification as to whether the owner,
operator or senior management official
who signs the trade secret certification
must be the same individual who signed
the section. 312 or section. 313
certification. The Agency does not
require the same individual to sign all
the forms; the Agency wishes to
encourage the most knowledgeable
individuals with sufficient authority to
sign each certification. This balance of
knowledge and authority for all sections
of Title HI may not be possible for one
individual in a large corporation with
various divisions.
Finally, the Agency received one
comment stating that the phrase
requiring the official to verify that the
substantiation was "true,, accurate and
complete to the best knowledge and
belief of that official was unduly
burdensome and defeated the purpose of
the trade secret provisions. The Agency
believes that the language in the
proposed rule is appropriate to convey
the serious nature of the certification
statement and the trade secret
substantiation and has retained it in the
final rula
/. Claims of Confidentiality, in the
Substantiation
Sometimes the submitter may need to
refer to the chemical identity claimed as
trade secret in the substantiation for
that chemical. Also, in order to supply a
complete explanation of its claim of
trade secrecy, the submitter may include
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28788 Federal Register / Vol. 53. No. 146 / Friday. July 29. 1988 / Rules and Regulations
other trade secrets or confidential
business information in the explanation.
Section 322(f) allows submitters to
claim as confidential on the
substantiation form any information
which falls within 18 U.S.C. 1905, the
federal Trade Secrets Act, which
requires the federal government to
protect trade secrets and confidential
business information unless another
federal statute authorizes disclosure.
Thus, the information which may be
claimed confidential in the
substantiation includes the specific
chemical identity, as well as any other
trade secret or confidential business
information.
One commenter requested that the
term "business confidentiality," which is
defined in the Definitions section, be
deleted wherever it appears. The
commenter requests that the term
"confidential business information" be
used in its place. The Agency agrees
that "confidential business information" ,
his 8 common usage hi the law of trade
secrets. However, "business
confidentiality," as defined in the final
rule, is the same term used in the
Agency's confidential business
information regulations at 40 CFR Part 2.
To-make these claims, the submitter
must clearly label what information it
considers to be trade secret or
confidential This' substantiation is to be
submitted to EPA, along with a sanitized
substantiation, in which the trade secret
and confidential business information is
.deleted^ If any of the information
claimed as trade secret on the
substantiation is the chemical identity of
a claimed chemical, then the submitter
should include the appropriate generic
class or category of that chemical on the
sanitized version of the substantiation.
No substantiation needs to be
submitted for information that the
submitter includes in the substantiation
and claims as trade secret or
confidential. The submitter need only
sign the certification included at the end
of the substantiation form, as discussed
above hi section H. The claims of trade
secrecy and confidentiality for
information submitted in the
substantiation are not subject to the
petition process described below
because this process applies only to
claims of trade secrecy for the chemical
identity made under Title HI. Instead,
requests for disclosure of other trade
secret or confidential material must be
submitted pursuant to the Freedom of
Information Act regulations under 40-
CFR Part 2.
The Agency received a comment
requesting that the unsanitized
substantiations be automatically
classified as confidential under
Executive Order 12600 which sets forth
designation and notification procedures
for confidential business information
under FOIA. The provisions of this rule
are in compliance with the Executive '
Order; unsanitized substantiations [
claimed as confidential are treated as '
such until determined otherwise.
/. Updating Substantiations Submitted
Prior to Final Rule
Several commenters suggested that, in
order to achieve "fundamental fairness,";
EPA should allow companies that
submitted their Title ffl submittals prior.
to the effective date of this-final rule on ;
trade secrets to update their :
substantiations without penalty. .
EPA agrees with this comment.
Submitters could not know exactly what:
information would be required on the j
substantiation form until the final rule
on section 322 is published. Thus,
submissions filed prior to the effective
date of this final rule will be allowed to
be updated. Submitters may wish to '
utilize the final rule for filing submittals :
immediately upon publication, prior to ,
the effective date, and are free to do so.
Commenters also requested that :
previous substantiations be returned to
them when they submit an updated ;
version. This is not possible, however. ;
The Federat Records Retention Act :
requires that government keep such \
submittals as part of the Agency's
record hi order to support the Agency's
activities and decisions.
K. Cross-Referencing of Substantiations
EPA has been encouraged by industry
commenters to develop a reporting
option that would allow trade secret
claimants to cross-reference trade secret
substantiations already submitted to
EPA in subsequent Title in filings
involving the same chemical and trade
secret. Because the same chemical
involving the same trade secret may be
reported under different sections of Title
Dl, and because these reports require
periodic updating, claimants argued that
the trade secret substantiations for each
claim would be the same.
At least three different scenarios ;
involving cross-referencing were !
identified by the commenters: (1)
Subsequent reports involving the same
chemical reported under different t
sections could all reference and rely on
the same trade secret substantiation
•(multi-section referencing): (2)
subsequent reports involving the same
chemical and the same section—e.g.,
annual section 313 toxic chemical ,
release reporting—could reference and
rely on the earlier submitted
substantiation (multi-year referencing);
and (3) multi-facility companies could ;
cross-reference a single substantiation
when reporting for each of their
facilities at which the same chemical is
present, both for reporting under
different sections (multi-facility
referencing) and in subsequent years
(multi-facility, multi-year referencing).
The issues raised by these comments
require the Agency to strike a balance
between a submitter's ease and
convenience in making and
substantiating trade secret-claims, and
the relative burdens, costs, and risks
posed by altering the trade secret
substantiation requirements to
accommodate this proposed method of
reporting.
On the one side of the balance, EPA's
analysis indicates that a submitter's
reporting burden is not reduced by
cross-referencing.
First, a submitter must review their
prior-prepared substantiations to
identify one that is appropriate and
relevant for re-use (that is, an identical
substantiation). Cross-referencing
requires that the submitter provide EPA
with information sufficient to accurately
identify the prior-submitted
substantiation. Without cross-
referencing, a submitter wishing to re-
. use an appropriate and relevant
substantiation would be expected to
.photocopy the form, alter the reporting
section check-off box, and re-sign the
certification statement. The time and
costs associated with each of these
tasks are approximately equal, the costs
for the cross referencing method being
slightly higher for the submitter.
This somewhat counter-intuitive
result is traceable to the labor-intensive
procedures for cross referencing. While
cross-referencing reduces'the amount of
paper involved, it is a slightly more
complex process that increases the labor
costs for submitters. The result is that
there is no net savings for submitters
achievable by cross referencing on a per
document basis.
Second, EPA does not expect the .
number of trade secret substantiations
that will be identical to be high, further
reducing the potential for cross
referencing to be an effective burden-
reducing reporting method. The overall
number of trade secret claims should not
be high—approximately 0.1 percent of
all Title III filings are expected to
include trade secret claims—and
because of the inexact nature of trade
. " secrets and the differences in
information required to be disclosed
under each of the five reporting sections
for which trade secret claims are
allowed, the universe of substantiations
that will be identical and appropriate for
re-use should be small. There is thus a
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Federal Register / Val.53,_No. 146 /Friday.July 29, 1988 / Rules and Regulations 28789
low potential for cross referencing to
measurably reduce a submitter's
reporting burden, i ' >,,:
Weighing against cross referencing
are a variety of costs and other factors
not consonant with the disclosure focus
of the Title III program.
Trade secrets-by definition run
counter to the right-to-fcnow intent of
Title III, and just as the decision to make
a trade secret claim should not be taken
lightly, neither should substantiations be
prepared, as a routine document. The
Agency encourages claimants to closely
examine the reported information
required in each case, and carefully
assess whether and" how that
information affects what the submitter
believes to be a trade secret. This
explanation must be included in the
substantiation. Even where previously
created substantiations are relevant and
appropriate for referencing, the claimant
should have taken the time to carefully
review the substantiation to-determine
its applicability ta another daim. EPA
procedures are designed to encourage
this: process.
Cross referencing has- the potential to
discourage such reviews and makes-
more likely the preparation and use of
"boilerplate" substantiations, for routine
use. A review of substantiations.
submitted thus far under sections 311- •
312 indicates, that many submitters are
treating trade secret substantiations in
this way. This is not consistent with the
clear congressional intent that facilities
subject to Title IH provide EPA and the
public with specific and detailed
information when making a trade secret
claim. Moreover,-because of their
general nature, boilerplate
substantiations are more likely to be"
found insufficient to support a trade
secret (thereby imperiling the claim),
than is one specifically prepared to
support a particular claim.
Finally, the costs to the Agency to
implement a cross referencing system
are not justified by the small potential
for reducing a submitter's reporting
burden. Cross referencing adds up to
nearly 50 percent to the Agency's costa
on a per document basis, exclusive of
other system design and development
costs and requirements. And because
cross referencing increases the risk of
an inadvertent disclosure of submitter's
trade secret information (due, for
example, to faulty identification
information), additional quality-control
procedures, and security measures are
required, at increased cost.
On balance, weighing the lack of any
savings in the time and costs required
for submitters to prepare a
substantiation against the increased
costs to the EPA and to the title III
program, cross'referencing is not
justifiable as a viable and effective :
.'. reporting alternative, rlowever, EPA is :
sensitive to and understands the
burdens imposed by the extensive
reporting requirements of Title III".
One significant factor contributing to
the number of duplicate reports required
is the number of different recipients
specified by the Act. Within this
statutory framework, EPA has
investigated and will continue to
investigate ways to reduce the overall
reporting burden without compromising
the primary objective of Title HI.
Toward this end,. EPA has been able to
identify and plans to implement other
improvements to streamline the
reporting process.
One burden-reducing improvement is
the deletion of the requirement for the
creation of an "unsanitized" MSDS
when making a; trade secret daim. under
section 311. Smce most Title in reports
and trade secret claims involve section
311, this should represent a significant
savings. For similar reasons, EPA also
deleted the requirement foe unsanitized
section 303 reports. In addition, EPA
considered—and rejected—a
requirement for claimants ta
substantiate as trade secreta the
hazardous components of mixtures-
reported as a whole under section 311.
which would have significantly added to
the. reporting burdens of complying with
the trade secret rule.
EPA has taken steps to reduce the
Title III reporting burden in other ways,
such ay permitting facilities to report
their non-trade secret information by,
magnetic media.
EPA will continue to investigate ways
to make compliance easier and more
cost-effective both for EPA and for those
subject to this law, while meeting the
mandate received from Congress.
Weighing the potential benefits of
referencing against the costs and
burdens,, it does not appear that cross
referencing is a viable method.
However, EPA will look at the number
of opportunities for cross referencing
through the summer of 1989 and if actual
experience provides contrary data, this
issue will be revisited. Also, EPA will
permit cross referencing of previous
submissions sent to States on a State by
State basis, as the States allow.
L. Submissions to State and Local
Authorities
If a-trade secrecy claim iff made with
respect to a particular submission, the
sanitized Title III submittal and the
accompanying sanitized substantiation
must be sent to the appropriate State or
local authorities, as required under
section 322(a)(2)(ii) of the Statute.
Specifically, under section 303, the
.^ubmittal and accompanying sanitized -
-"••substantiation should be sent to LEPGs,
and under sections 311-312 the MSDS or..'
a sanitized section 311 list or Tier II
submittal, as appropriate, and
accompanying substantiation should be
sent to the SERCs, the LEPCs and to
local fire departments. Finally, a
sanitized 313 submittal and
substantiation must be sent to the
designated State entity. If a Title III
reporting form or a substantiation
containing trade secret information is
sent to a State or local authority by the
submitter, under the law of trade secrets
it will constitute public disclosure of the
information, and the claim will be
considered invalid.
Several commenters requested that
EPA delete the requirement that a
sanitized copy of the substantiation be
sent to the State authorities and the
local emergency planning committees.
Section 322(a)(2)(A)(ii) requires that a
trade secret claimant include in its
section 303 (d)(2) and (d)(3), sections
311-312 and section 313 submittals an
"explanation of the reasons why such
information is claimed trade secret."
Finally, these sections provide that all
facilities subject to the Act submit this
Title III submittal to the appropriate
state and local authorities. Therefore,
EPA cannot delete this requirement.'
in. Petitions Requesting Review of
Trade Secrecy Claims
Section 322 provides for a public
petition process to request the
disclosure of chemical identity claimed
as trade secret. This petition process is
only for requesting a review of the
validity of a claim that a chemical
identity is a trade secret. If requesters
want disclosure of other items that have
been claimed confidential (that is, items
claimed as confidential in the
substantiation, rather than the Title III
reporting document), such requests for
disclosure must be made pursuant to
EPA's Freedom of Information Act
regulations under 40 CFR Part 2.
The petition requesting disclosure
must include the petitioner's name,
address, and telephone number. The
petitioner may be an individual,
corporation, or other entity. It must also
include the sanitized copy of the
submission (e.g., the MSDS, toxic
chemical release inventory reporting
form) in which the chemical is claimed
as trade secret, and the petitioner must
clearly indicate on the form which
chemical identity is requested for
disclosure. Copies of the section 303
(d)(2) and (d)(3) filings are available at a
location designated by the local
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26790 Federal Register /• Vol. 53. No. -146 /Friday.July29.^1988 / Rules and Regulations
emergency planning committee. Copies
of the section 311 and 312 filings are
available at locations designated by the
State emergency response commission
and the local emergency planning
committee. Copies of the section 313
filings are available from EPA and from
the designated State agency.
EPA is requiring that a copy of the
submission claiming trade secrecy
accompany petitions for disclosure of
chemical identity claimed as trade
secret The Agency believes that the
requirement of a copy serves to prevent
any confusion about what disclosure the
petitioner is requesting. In the proposed
rule, public comment was specifically
requested on'this issue. All four of. the
commenters who addressed this issue
agreed that a petition for the disclosure
ofa chemical identity claimed as a trade
secret should include a copy of the
submission claiming the trade secret
One commenter requested that the
trade secret submitter be informed of
the identity o£ a petitioner who has
petitioned for the release-of a trade
secret specific chemical identity. This is
not required by the statute and the
Agency has decided not to add it to the
final rule. However, the petitioner's
name is publicly available under the
Freedom of Information; Act Also, the
petitioner is free to contact the facility
directly.
EPA received several comments
concerning standards for the petition
process. A few commenters requested
that EPA restrict the petition-process in
order to discourage petitioners who are
seeking Information for commercial,
competitive or harassment purposes.
Other commenters highlighted the
importance of placing no limits on .
petitions to disclose the specific
chemical identity since na restrictions
were set forth in the statute. EPA agrees
that it would be inappropriate to require
petitioners to have a particular reason
for requesting disclosure of chemical
identity claimed.as trade secret The
statute specifically states that "any
person may petition the Administrator"
and thus the Agency will not impose
restrictions.
At least one commenter requested
that EPA limit the number of times a
trade secret could be challenged through
the petition process, to avoid the filing
of multiple petitions for disclosure of the
same trade secret However, the
limitations of the statute, as described
above, apply to the multiple petition
situation as well, and EPA can provide
no change in the final rule.
As soon as a petition is filed, EPA will
begin the process of reviewing the trade
secrecy claim. The time for reviewing
tha claim may vary, but the statute
requires EPA to reach a decision within
9 months.
The petition should be mailed to the ;
address set forth in § 350.16 of the rule,
and set forth in this preamble at section
II.B.4.
IV. EPA Review of Trade Secrecy
Claims
As described in the proposed rule, \
section 322 defines the process by which
EPA determines whether a claimed
chemical identity is entitled to trade i
secrecy. First, EPA must decide whether
the answers to the substantiation
questions are, if true, sufficient to ,
support the conclusion that the chemical
identity is a trade secret This is the
determination of sufficiency referred to
in the statute and is made prior to any
determination of the validity of the trade
secrecy claim. The statute requires EPA,
to follow different procedures depending
on whether EPA decides the .answers to.
• the substantiation questions are
sufficient or insufficient ;
A. Overview of the Process
After receiving a petition requesting ;
disclosure of chemical identity, EPA has
30 days to make a determination of
• sufficiency. ,If the claim meets EPA's
criteria of sufficiency (explained in
IV.CJ, EPA will notify the submitter that
he has 30 days from the date of receipt
of the notice to submit supplemental '
material in writing, supporting the truth
of the assertions made in the
substantiation. If this additional
information is not forthcoming, EPA wilt
make its determination based only upon
information previously submitted in the
substantiation.
If the claim does not meet the criteria
_ of sufficiency, EPA will notify the . ,
submitter, who may either file an appeal
within 30 days to EPA's Office of •
General Counsel or, for good cause
shown, amend the substantiation in
support of its claim.
Once a claim has been determined to
be sufficient, EPA must decide whether
the claim is entitled to trade secrecy. If
EPA determines that the facts support
the claim of trade secrecy, the petitioner
will be notified. If EPA determines that
the facts do not support the claim of
trade secrecy for chemical identity, the
submitter will be notified. -
The statute provides for intra-agency
appeal by the submitter to appeal
adverse decisions and for U.S. District I
Court review after intra-agency appeal.
This process is explained below in more
detail.
B. Initial Review • ',
Proposed § 350.9(d) required that
when EPA receives a petition requesting
disclosure of a trade secret, or if EPA.
decides to initiate a determination of the
validity of a trade secrecy claim, EPA
shall first determine whether the
chemical identity claimed as trade
secret is the subject of a prior EPA
determination of trade secrecy for that
chemical identity at that same facility. If
the earlier determination held that the
facility's trade secret claim for the
chemical identity was invalid, EPA was
previously authorized to release the
information. Before releasing the
information, the proposed rule stated
that the Agency would notify the
petitioner that the facility's claim for
trade secrecy status for the chemical
identity is the subject of a prior
determination concerning the same
facility and that such claim was invalid.
Four coriunenters discussed the role
that prior determinations should play in
determining the validity of a trade secret.
claim. Some commenters said that prior
determinations denying claims of trade
secrecy shoukinot-be determinative of
future claims concerning the same
chemical, and suggested that thisicould
violate constitutional due process. One
commenter suggested, that, in the
alternative, the section should be
revised to give equal weight to prior
. determinations that upheld the trade
secret. Two commentera stated that
once a specific chemical identity has •
been determined to be a trade secret,
that finding of validity should be
determinative against subsequent
challenges to the same chemical.
While the Agency is not changing the
scope of the provisions dealing with
prior determinations in the final rule,
EPA believes that some clarification of
§ 350.9(d) would better explain the
nature of the prior determination and
would respond to the^ commenter's
concerns. The purpose of § 350.9(d) is to
establish a simple procedure for
releasing a chemical identity which has
already been disclosed in a prior
determination for the same chemical
identity at the same facility. If the trade
secret has been previously disclosed,
Title III does not permit EPA to continue
to withhold the chemical identity as a
trade secret Obviously, if the chemical
identity has been revealed, the chemical
identity is ho longer a trade secret. Of
course, the Agency's prior determination
that the trade secret is invalid must
have survived any appeals before the
disclosure provision will be applied. The
value of this provision was to expedite
release of chemical identity which has
already been revealed, but to satisfy due
process EPA will not disclose the
identity until the submitter has
exhausted his challenges to the initial
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/ Friday, July 29. 1988 / Rules and Regulation
Agency determination upon appeal to
OGC and in U.S. District Court The
final rule has been amended to clarify
this point
The Agency is bound by the prior
disclosure only if the chemical identity
claimed as trade secret that is the
subject of the Second petition is
identical to the trade secret disclosed
when the prior determination held the
claim to be invalid. There may be
instances where the use of the chemical
identity claimed as trade secret that is
subject to the prior petition (and Agency
determination) is different from the
trade secret use that is the subject of the
second petition. The information on
different Title ffl submittals could
represent different uses, one that did not
qualify for trade secret protection under
Title ffl and one that does. In short, EPA
agrees with commenters to the extent
that 5; 350.9(d) in the final rule will not
automatically disclose a chemical
identity until the Agency has determined
that the identical trade secret has been
held invalid in a prior determination.
The Agency will not be bound by a
prior decision upholding trade secret
protection in this. rule. Trade secrets can
be lost over time and the burden is on
the claimant to prove that the chemical
identity meets the statutory criteria .
upon receipt of a petition for disclosure.
However, the Agency's prior
determination of validity will be
considered in later determinations.
Two commenters asked that a trade
secret claimant be given adequate
notice before a. chemical identity is
released. One of these commenters
stated that if a prior determination was
made that a facility's chemical identity
was not a trade secret EPA should
delay 30 days before releasing the
information in order for the claimant to
seek judicial review. EPA has provided
notice of intent to release chemical
identity in various sections of the
proposed rule where the Agency has
determined that the chemical identity
claimed as trade secret is not entitled to
protection. The case of disclosure of
chemical identity where a prior
determination has been made is not
significantly different from those other
cases where the rule provides for notice
and the opportunity to appeal to U.S.
District Court before release of the
claimed trade secret As a result
§ 350.9(d) of the final rule will be
referenced to an amended § 350.18(c)
which contains detailed requirements
for notice of intent to release chemical
identity determined not to be trade
secret.
C. Determination of Sufficiency
A person withholding specific
chemical identity from a submission
under Title III must make specific
factual assertions that are sufficient to
support a conclusion that the chemical
identity is a trade secret. These
: assertions are made by completely
answering all of the questions listed in
§ 350.7 of the rule (and found also on the
Trade Secrets Substantiation form),
where EPA has listed the questions that
must be answered to fully address the
four requirements set forth in section
322(b) of the statute.
To assist submitters La answering the
questions, EPA indicates in § 350.13 of
the rule the criteria that it regards as the
legal basis for evaluating whether
answers provided by submitters are
sufficient to support the trade secrecy of
a chemical. Submitters may wish to
examine these criteria in preparing their
answers to the questions contained on
the form.
EPA received several comments
discussing the proposed sufficiency
criteria. Some comments suggested that
the Agency reduce the detail of the
sufficiency criteria, so that the
sufficiency criteria are not overinclusive
of the statutory criteria and, in turn, the
questions on the proposed form. The
suggestions leaned toward making the
. sufficiency criteria identical to the
proposed questions. Other comments
suggested altering the proposed
questions so mat they identically reflect
the sufficiency criteria. This way a
claimant can directly address the
criteria that EPA is seeking in order to
establish a prima facie case of trade
secrecy. Finally, other comments
suggested that EPA review the proposed
substantiation form to match the trade
secrecy factors in section 322(b). This
would substitute for the proposed
sufficiency criteria altogether.
EPA determined that the sufficiency
criteria, as proposed, are a valuable aid
in evaluating the sufficiency of trade
secret claims. While the substantiation
form elicits specific facts, the criteria
stated at § 350.13 are the legal standard
used to determine whether the submitter
has established a prima facie case for
trade secrecy. The facts from the form
are considered against the sufficiency
criteria to make that determination.
The commenters' suggestions would
alter the purpose of the criteria and
undermine the ability of the Agency to
determine whether or not submitters
have made a prima facie case for trade
secrecy undei the initial review process.
EPA did make changes in the sufficiency
criteria to reflect changes made in the
substantiation questions.
Submitters are encouraged to use the
sufficiency criteria as a guide in
formulating their answers to the
substantiation questions. Both the
questions and the criteria reflect the
trade secrecy provisions of section
322(b) of Title III.
Under the first criterion, the facts
must show that reasonable safeguards
have been taken against unauthorized
disclosure of the specific identity, thai
the specific chemical identity has not
been disclosed to any person not bound
by a confidentiality agreement including
local, State or Federal government
entities; and that any safeguards will be
continued in the future.
Under the second criterion, the
submitter must show that the chemical
identity claimed as trade secret is not
required to be released: (1) Under a
determination by a State or Federal
agency that the chemical identity in
question is not a trade secret, or (2)
under a State or Federal law which does
not allow the chemical identity to be
claimed as trade secret This criterion
was also discussed in section H.A. of
this preamble under emission and .
effluent data.
Under the third criterion, as proposed,
to show that disclosure of the
information is likely to cause substantial
competitive harm, the facts must show
• that either competitors do not know that
the substance can be used in the fashion
used by the submitter and that
duplication of the specific use cannot be
determined by competitors' own
research activities or that competitors
are unaware that the submitter is using
the substance in this manner.
Some of the comments on
substantiation Question 4 also raised
similar concerns with this criterion. The
final sufficiency requirement has been
amended where appropriate to reflect
the Agency's determination that a
submitter cannot be required to certify
another's state of knowledge, yet must
adequately support his claim of. trade
secrecy. The revised § 350.13(a)(3) reads
as follows, in the final rule:
(i) Either
(A) competitors do not know or the
submitter is not aware that competitors know
that the chemical whose identity is being
claimed trade secret can be used in the
fashion that the submitter uses it, and
competitors cannot easily duplicate the
specific use of this chemical through their
own research and development activities; or
(B) competitors are not aware or the
submitter does not know whether
competitors are aware that the submitter is
using this chemical in this fashion.
(ii) The fact that the submitter
manufactures, imports or otherwise uses this
chemical in a particular fashion is not
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28792 Federal Register/VoL 53. Na-146 / Friday.July 29. 1988 / Rales and Regulation^
contained in any publication or other
information source [of which the submitter is
aware} available to competitors or the public.
(Emphasis added to show changes in final
cult.)
Several commenters, following the
lead of the Chemical Manufacturers
Association and the American
Petroleum Institute, requested that EPA
revise the final rule to recognize that
just because one (or even several)
competitors in a field of many know that
a substance is being used in a particular
fashion, this does not prevent the use
from constituting a trade secret. EPA
agrees with the commenters. The law of
trade secrets does not require that the
owner of the information be the only
one aware of the information for it to be
of value. The language of the rule refers
to the knowledge of "competitors," and
this is open-ended enough to encompass
a claim asserted in a factual situation
where some competitors are aware of a
secret of which others are unaware*.
Therefore, EPA recognises the validity
of tha commenters' arguments but has
not changed the language of the final
rule to reflect this. Trade secrecy
claimants may file substantiations
based on a factual situation such as the
one described above.
Finally, the fourth criterion requires.
that a trade secret claimant show that
the chemical identity claimed trade
secret cannot be readily discovered by .
reverse engineering of the submitter's
products or environmental releases. This
requires the claimant to show that the
chemical is not available to the public or
competitors in the claimant's products
or environmental releases. Tha claimant
must show that the chemical identity is
only discoverable using equipment that
is not readily or generally available, that
discovery requires the use of uncommon
or exotic analytic techniques, and that
the time, costs, and resources required
for discovery exceed the benefits
provided by the trade secret chemical.
The more difficult, costly, and time-
consuming the analysis required to
discover the identity, the more likely the
chemical identity will qualify for trade
secret protection.
If the substantiation does contain
sufficient answers, EPA will notify the
submitter by certified mail. Under the
statute, a finding of sufficiency
automatically entitles the submitter to
submit supplemental information to
support the truth of the answers
contained in, the substantiation. This
could include any information or
documents which would demonstrate
the veracity of the submitter's
substantiation, or provide even greater
detail in support of the submitter's
claim. Based on comments on the
proposed rule, EPA narrowed the level
of detail required in the initial
substantiation and thus increased the
importance of the material provided in
this second stage. This was done in
order to decrease the initial burden
without sacrificing the amount of
information that would be used to
determine the veracity of a claim of
trade secrecy.
Upon receiving EPA's request for
supplemental information, the submitter
will have 30 calendar days to submit the
information. If EPA does not receive the
supplemental information within this
time, it will make a trade secret
determination based upon the
information already submitted. One
commenter inquired as to when the 30
days provided to submit additional
information to EPA tolls.. Specifically,
must the information be received by
EPA within 30 days, or will the Agency
adopt a "mailbox rale", as suggested by
the commenter? The Agency has-
decided to adopt:the:"mailbox rule."
and.Witt-consider the-subnriasion to be
timely filed if postmarked within 30
daya by certified, mail with the U.S.
Postal Service.
D. Determination of Insufficiency
If EPA concludes that a substantiation
does not contain answers sufficient to
support the four requirements of section
.322{b), then. EPA will find that tha trade
secret claim is insufficient Tha
submitter will be notified by certified.
mail of EPA's finding of insufficiency.
The submitter may either appeal EPA's
Finding to EPA's Office of General
Counsel or may amend its original
substantiation if it demonstrates good
cause to do so.
Good cause was limited in the .
proposed rule to the following:
(I) The submitter was not aware of
the facts underlying the additional
information at the time the original
substantiation was submitted, and could
not reasonably have known the facts at
that time; or
• (2) Neither EPA regulations nor other
EPA guidance called for such
information at the time the
substantiation was submitted.
The Small Business Administration
commented, prior to the publication of
the proposed rule, that the good cause
standard should include the
circumstance where die submitter
mistakenly does not provide information
but otherwise acts in good faith'to
comply with the rule, and that such a
provision was mentioned in the '
Conference Report'
Various commenters agreed with the
Small Business Administration and
criticized this provision as unduly harsh.
These commenters noted that various
circumstances could occur, such as
! clerical errors or explanations being
' separated from the substantiation forms,
that would result in EPA receiving an
incomplete substantiation.
EPA has evaluated these comments
; and largely agrees with the commenters.
The Agency has included inadvertent
omissions as one of the good cause
exceptions in the final rule. It is still
: incumbent on submitters to ensure that
claims are complete and properly
packaged. Submitters should not be
tempted to rely on this good cause
; exception to routinely cure defective
submissions.
. One commenter interpreted the
"neither-nor" language in the second
exception as indicating that the Agency
would be giving guidance, which is
published without'notice and comment,
the same weight as regulations. The
: commenter. also noted that the
. Conference Report used the conjunctive
; "and." The Agency intended to adopt
the same meaning as that included in
the Conference Report. Accordingly this
language has been changed in the final
'\ rule.
EPA has revised the good cause
\ exceptions to read as follows:
"(A) TTie-submitter was. not aware of the
facts underlying the additional information at
i the time the substantiation was submitted,
and could not reasonably have known the
facts at that time; or
! (B) EPA regulations and other EPA
guidance did not call for such information at
the time the substantiation was submitted; or
(C) The submitter had made a good faith
: effort to submit a complete substantiation,
1 but failed to do so due to an inadvertent
omission or clerical error."
i
The. submitter must notify EPA by
letter of its contentions as to good cause
and should include in that letter the
additional supporting material. EPA will
notify the submitter by certified mail if
the good cause standard has not been
\ met and the additional supporting ;
material will not be accepted. The
submitter may then seek review in U.S.
District Court. If after acceptance of
• additional supporting material for good
cause, EPA decides the claim is still
insufficient, the submitter will be
notified by certified mail and may seek
, review in U.S. District Court.
i If EPA reverses itself on appeal or
after accepting additional assertions for
good cause, and decides that the trade
secret claim is sufficient then the claim
will be processed as though it had been
initially found to be sufficient If upon
appeal, EPA makes a final
determination that the original answers
: in the substantiation were insufficient,
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2879S
the submitter may request review in U.S.
District Court within 30 days of notice of
the final determination.
E. Determination of Trade Secrecy
All claims determined to be sufficient
either initially, after appeal, or after
acceptance of additional material for
good cause, will be examined in order to
determine whether a valid claim of trade
secrecy is presented. In making a
determination of trade secrecy, EPA will
examine the factual information
provided in the substantiation form in
light of the four factors under section
r 322(b).
If EPA decides that the chemical
identity is a trade secret, the petitioner
shall be notified by certified mail and
may seek review in U.S. District Court.
If EPA decides that the chemical
identity is not a trade secret, the
submitter shall be notified by certified
mail and may appeal this determination
to EPA's Office of General Counsel
within 30 days. If EPA does not reverse
its decision on appeal, the submitter
may seek review in U.S. District Court
within 3O days of notice of the final
determination.
F. Appeals
. Section 350.17- of the proposed rule
established-procedures for appeal from
an EPA determination that a claim
presented insufficient support for a
finding of trade secrecy under- -
§;350.11(a)(2)(i), or an EPA finding that a
specific chemical identity is not a trade
secret under § 350.11(b)(2)(i). The
proposal provided procedures for filing
an appeal to EPA's Office of General
Counsel (OGC), a description of the
appeal process in OGC, and procedures
for further appeal to Federal court if
OGC upholds the Agency's rejection of
the claim for trade secret protection. The
proposed rule did not specify the
standard that OGC will apply in
considering a submitter's appeal, nor did
it provide for a hearing. These two
features as well as other details of the
appeal process received comment.
Two commenters requested that EPA
amend § 350.17 to provide the right to a
hearing on appeal to OGC. One of these
commenters specified that the hearing
should be provided upon request of the
trade secret claimant -
One commenter asked that the
regulation be revised to establish a
standard under which review by OGC
on appeal will be conducted. The same
commenter further stated that because
a reviewing court will consider the
Agency opinion on a de novo basis,
OGC should use a de novo standard in
reviewing the program office's decisions
on appeal. . . ; ,. -. .
Four commenters stated that § 350.17
should be revised to require OGC to
state the basis for its 'decision on appeal.
Another of these commenters
recommended the use of procedures
paralleling those referred to in
§ 350.11{b), which are applicable to
EPA's initial decision on a trade secrecy
claim and require EPA to provide a
claimant with the reasons for EPA's
decision.
One commenter requested that the
rule be revised to permit a submitter of a
trade secret claim to appeal to OGC if
his claim is judged to be insufficient,
even after he has submitted additional,
material upon a showing of good cause.
EPA's provisions on appeals in
§ 350.17 closely follow the scheme for
appeals under Title HI. Title HI did not
provide the submitter with an
opportunity for a hearing as part of the
administrative appeal process and EPA
will not include such a provision.
Title IH also did not specify a
standard of review for the
administrative appeal process. In its
review, the Office of General Counsel
will be examining the entire record of
the determination and statement of
reasons. This review will encompass the
complete file. Submitters who are
denied trade secret protection have full
access-to U.S. District Court
The Agency agrees-with commenters
that sound administrative procedures
dictate that the submitter be provided
with a statement of the reasons for
OGC's decision to uphold or reverse the
program office's decision on appeal. The
final rule has been amended to include a
requirement for a statement of reasons
to accompany the OGC decisions upon
appeal.
Finally, EPA has not changed the final
rule to allow an appeal to OGC when a
submitter whose trade secrecy claim has
been found to be insufficient has chosen
to submit additional material in support
of its claim (for good cause shown). This
provision tracks statutory language that
permits the trade secret claimant to
either amend the claim in order to meet •
the sufficiency requirements or to
appeal the finding of insufficiency to
OGC. If the claimant opts to amend the
claim, the statute requires that the right
to appeal the Agency's initial finding is .
forfeited. However, the submitter who
loses the right to-an OGC appeal still
has the right to appeal the Agency's
adverse determination to U.S. District
Court
Judicial Appeal
Section 350.18(c) of the proposed rule
established procedures to be used by
EPA when submitters are slow to appeal
Agency decisions to U.S. District Court:.
or fail to prosecute the appeal in a
timely fashion. One provision of the
proposed section received considerable
comment. That provision authorized the
Agency to disclose the identity of the
-trade secret, "once the court has denied
a motion for a preliminary injunction in
the action or has otherwise upheld the
EPA determination, or whenever it
appears to the Office of General
Counsel, after reasonable notice to the
business, that the business is not taking
appropriate measures to obtain a speedy
resolution of the action."
In urging deletion of the provision, the
commenters made several arguments.
First, the commenters noted that, once
the submitter's appeal is under the
court's jurisdiction, there are existing
mechanisms to insure a speedy
resolution of the case at issue. The
. Federal Rules, of Civil Procedure allow
the government to request a status
conference to press action (Rule 11} or
to move for dismissal of the appeal for
failure to prosecute if there is an undue
delay (Rule 41). Next a few commenters
maintained that the government's action
to speed up the appeal would destroy
. the trade secret unilaterally during the
pendency of action challenging the
government's right to make that
'.destruction..The commenters believe
this action-was unfair and undercut the
court's jurisdiction. Moreover, since a
trade secret is an intangible property
right guaranteed by Constitutional
protections, government destruction of
that property during the course of the
appeal could constitute a violation of
submitter's due process rights.
EPA has decided not to delete the
provision in question in the final rule.
The provision is identical to language in
EPA's Confidential Business Information
regulations at 40 CFR 2.205(f)(2), and
thus makes Title in regulations
consistent with similar EPA procedures.
The language of proposed § 350.18(c)
and final § 350.18(d) states that EPA
may disclose the trade secret that is,
use of the provision is not mandatory.
Also, this disclosure may take place
only after reasonable notice to the
business. Accordingly, EPA has
finalized this section as proposed,
except for changing the reference to the
party appealing the denial from
"business" (used in 40 CFR Part 2) to
"submitters" (used in Title III).
G. Common Errors Found on
Substantiations
The Agency examined a sample of
substantiations received since the
proposed rule was issued and
discovered a number of errors that
occurred frequently enough that the
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it is difficult to determine whether a
claim is complete and what chemical(s)
is (are) being claimed trade secret. If it
is not clear that a chemical identity is
being claimed trade secret, EPA will not
know that it. should not make the
information- available to the public. For
the submitter's own protection, securing
together all three or four parts of a claim
will make it clear that a claim is
complete when submitted.
These guidelines and requirements
are designed for the submitter's and the
Agency's protection. If they are not
followed, it will be much more likely
that the Agency will conclude, based
solely on the information provided by a
submitter, that a claim is frivolous or
incomplete. It also makes more likely
that the Agency will disclose
information that the submitter intended
to claim trade secret because it was not
clear that a claim was beingmade. At
the same time, following these •
guidelines permits EPA to make
appropriate determinations of trade
secrecy, and to legally make public
those portions of each sufamittal .
required to be disclosed. In this way
EPA can work to preserve the
confidentiality of legitimate trade
secrets, and fulfill the Congressional
mandate to make non-trade secret
information public.
H. Enforcement
*
Section 325(d) authorizes'the • .
Administrator to assess a civil penalty
of $25,000 per claim against a trade
secret claimant if the Administrator
determines that a trade secret claim is
frivolous. Two commenters asked for an
explanation of the term "frivolous
claims." One of these commenters asked
for policy guidance and recommended
that a good faith test be employed. A
third commenter expressed support for
the Agency position on frivolous claims,
and requested that the Agency
determine the validity of each trade
secrecy claim- without waiting for
petitions for disclosure of the
information.
A frivolous claim is one without a
factual or legal basis or one where the
facts and circumstances relied upon to
substantiate a trade secrecy claim are
without merit. Section 325(c) authorizes
the assessment of a civil penalty of
SlQ.OOO per violation for any person who
fails to furnish a substantiation. These
penalties can be assessed by either
administrative order or through the
appropriate U.S. District Court.
The proposed rule contained a
provision indicating that submitters of
trade secret claims who failed to submit
supplemental information requested by
EPA may be liable for a fine of up to
$10,000 per violation under section
325{c). When EPA reviewed the statute,
it was found that this provision had
been inadvertently included in the
proposed rule, but was not contained in
the Act. The final rule, therefore,
contains no such provision.
V. Relationship of Section 322 to Other
Statutes
A. Relationship to State Confidentiality
Statutes
As stated in the proposed rule, section
321 of Title HI provides that nothing in
Title HI "shall preempt any State or
local law." This means that the
confidentiality requirements of Title HI
are not to displace State confidentiality
requirements under State Right-Tc-
Know Acts. A State can still prescribe
the type of information it will classify as
confidential when it gathers information
for its OWB use under a State law, such
as- aRight-TorKnow Act However, state
confidentiality statutes- do not govern
information gathered under Federal law.
here Title EL State confidentiality
statutes only apply to information
collected pursuant to State law for State
use. When information is gathered under
Title m, the Federal confidentiality
requirements-of section 322 apply-
regardless of whether the information is
sent to a State or Federal agency
because the information is being
gathered pursuant to a Federal statute.
One commenter requested that the
"other" information in the Title IH trade
secret substantiation that is protected
under the Freedom of Information Act
be covered instead under more
protective State law. The commenter
argues that this is justified because the
information is being sent to State and
local entities. As stated above, the
destination of the data is irrelevant
because it is being gathered pursuant to
a Federal statute and thus the only
protection allowed is Federally based.
State confidentiality statutes may
affect Title HI information if State trade
secrecy law or regulations prohibit
claims of trade secrecy under State law
for information that a submitter must
also report under Title III. Under the
substantiation provisions of Title III, a
facility will not be able to justify
withholding the information under Title
III. One commenter stated that a State
law may require submission of data and
provide greater public access to the data
than would be allowed under Title III
protection of trade secrets. In such
cases, the data may not be eligible for
trade secret treatment under section 322.
B. Overlap with Other EPA-
Administered Statutes
Information collected pursuant to EPA
regulations under statutes other than
Title III may be similar to that collected
under Title in. For purposes of
confidentiality, information should be
claimed as confidential and will be
treated by EPA as is required by the
statute under which it is collected.
However, the mandatory release of
information under one statute may
affect its trade secret status under
another statute.
C. Relationship to Freedom of
Information Act
The procedures set out in section 322
apply only to claims of trade secrecy for
chemical identity made under Title III.
Pursuant to section 322(f), however,
submitters may claim as trade secret
any other confidential business or trade
secret information which is included in
the substantiation, or supplemental
information submitted in the. petition
process. Requests for disclosure of this
material must be submitted under the
Freedom of Information Act regulations
at 40 CFR Part 2. EPA will make
determinations regarding the disclosure
of this material under those regulations.
VI. Release of Trade Secret Information
A. Releases to States . •
Under section 322(h) of the Act. the
States, either the governors or the State
emergency response commissions, must
provide to any requesting person the
adverse health effects associated with
extremely hazardous substances
(section 303] and hazardous chemicals
(sections 3ll and 312) claimed as trade
secret. The States will not have direct
access to the identities of chemicals
claimed as trade secret in preparing •
adverse health effects descriptions.
However, the States have information
on health effects in the MSDSs
submitted under section 311 for this
purpose. The MSDS is required to
include such information for any
substance claimed as trade secret. Thus,
governors or State commissions should
not be hindered in meeting their
responsibilities to provide descriptions
of adverse health effects and the trade
secret status of the chemicals will not be
endangered.
Under section 322(g) of the Act, the
Administrator shall provide to the State
governor, upon request, any information
EPA has obtained under subsection.
(a)(2), which includes specific chemical
identities and substantiations for trade
secrecy claims, and under subsection
(d)(3), which includes the findings that
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287m Federal Register,/ Voi; 53, No: 146 / Friday, July 29. 1988 / Rules and Regulations
***"**** «j~-- * I iiiii • Lmi. i ii—s— .ta .'1 "ii"iiii|iiiii««'.;nii|i"iiiii'i.i|ii.iLi|j'''' •"'!»"iiiii1" !uB" .' nBiw "iiii'py'! i ?m.:.;'.::.T3E'"T|ri irwisug-JJuJ
assertions made in the above * ' ' •
substantiation materials are sufficient •
Thus. It a State governor wished to
request the chemical identities of any or
all chemicals claimed as trade secret in
any State, EPA will provide this
information to the State govemor,,upon
request. However, governors are
prevented by section 325{d)(2) from
"knowingly and willfully" disclosing
trade secret information to the public, as
are all other individuals.
EPA considered the advantages and
disadvantages of allowing State
governors to provide access to trade
secret information to SERCs andLEPCs.
Public comments also proposed several.
alternative ways of restricting-
disclosure of trade secret information
released to States.
While providing selected members of .
SERCs and LEPCs access-to Chemical
identities may provider some benefits to
State and local preparedness and
planning, it was determined that these
potential advantages were outweighed.'- !
by tho possible consequences of
unintended disclosure of bona fide trade
secrets. Because SERCroften include
representatives from industry and the
public and LEPCs must include these
representatives from industry and the
public, it could be very difficult to . ••
protect trade-secrets from-wider.
disclosure than is intended! EPA
determined that the decision of whether
State governors may provide-brade,
secret information to any members of .-
SERCs and LEPCs shall be left up- to- the
discretion of the governors themselves.
However, EPA has included a provision
in the rule which prohibits State
governors from releasing trade secret
information to non-Slate employees.
One commenter requested that trade
secret information be given to a State
only after the State has demonstrated its
ability to safeguard trade secret
information. The Agency requires in the
rule that States take the same
precautions to safeguard this
information as EPA itself does. Th&
Agency believes that this approach is
appropriate to adequately protect trade
secret information.
The Agency considered the.option of
allowing State governors to appoint
deslgnees to be provided with the
authority to request trade secret
chemical identities from EPA. This could
expedite requests by the State
departments of public health for
information needed to conduct medical
research on the health effects of
airborne toxics. However, such an
expansion of the list of authorized State
representatives beyond governors alone
might also increase the likelihood of
unintended-disclosure of bona fide trade-
secrets. The Agency concluded that it
does not have the authority to determine
who State governors may authorize to
obtain trade secret information from
EPA. Consequently, the EPA determined
that only State governors are authorized
to request and receive trade secret
information directly from EPA, as stated
in the statute.
B. Releases to Authorized
Representatives of EPA
In addition to contractors, and
subcontractors, EPA has recently begun
to use grantee personnel,to perform
Agency functions. Public comments-
raised two points. First.it was suggested
that the employees of grantees be
required to sign confidentiality
agreements (as is required of the
employees-of contractors and
. subcontractors). Second grantees were
described as presenting a greater risk of
disclosure of trade secrets (because they
are typically retired engineers or other
technical people having close
associations with former employers) and
should be placed under greater
restrictions than contractors or
subcontractors in general. Greater
restrictions were suggested to include
either requirements, for signing written
conflict-of-interest statements or
requirements.that grantees must
demonstrate 'a. greater need' fortrade •
secretinforinafioiu" . " . ..~ .
• The Agency believes ft is appropriate-
to designate grantees as "authorized
representatives," to be treated-ih the
same manner as Federal contractors and
subcontractors; as that term is used in
this regulation. This includes requiring
full confidentiality protection, the same
procedures that contractors must follow,
and similarly employees of grantees will
be required to sign confidentiality
agreements.
One commenter objected to proposed
§ 350.23. which makes contractors
authorized representatives of EPA for
the purposes of the relea'se of trade
secret information. This provision is
mandated by the Act. however, and die
Agency cannot alter or delete it.
Another commenter requested that the
Agency add a provision to the final rule
to make contractors who receive trade
secret information on behalf of EPA
aware of potential conflicts of interest.
The Agency has decided not to do so
because-contractors are already
required to provide the Agency with
such assurances as part of the
contractual process.
One commenter stated that EPA
should comply with Export
Administration Act (EAA) restrictions
on the export of technical data through
foreign'nationals. The commenter
puggested that through the petition
process, and in particular through
releases to health professionals,
technical data couid be exported. The
commenter also questioned whether
there exist suitable precautions to
prevent the export of technical data
through EPA's contractors,
subcontractors, and grantees to the EPA.
.Especially of concern would be the
disclosure, of confidential business
information to a citizen of a Category S
or Z country, which are listed in the
iExport Administration regulations.
! EPA has determined that the intent of
| these regulations is consistent with
those implementing the Export
i Administration Act. The definition of
•"technical data" found in the EAA
regulations reads hi part as follows:
'Technical data means information of
any kind that can be used, or adapted
for use, in the design, production,
manufacture, utilization, or
. reconstruction of articles or materials."
In section ELA. of the preamble to these
, regulations, the definition of-trade secret
i protection of specific chemical identity
• was said to allow for trade secrecy
' claims to be made to protect the linkage
: between a specific chemical identity
: and its "use, production, storage, or
processing." While these definitions are
similar, h.is noteworthy that these'
: regulations are designed to protect the
described'- information from release •
! except under very narrow, clearly
defined, and controlled circumstances.
It is not EPA's intention for a foreign
national to obtain trade secret
information and export the information.
The intent of the'statute is "community
right to know." EPA has every intention
; of doing everything in its power to
assure that the information collected is
1 used to inform and protect local
residents from chemical hazards present
in their communities. Disclosures which
1 lead to the export of that information
i out of the United States run counter to
that intent.
"The statute does not require, and EPA
has declined to establish a requirement
in these regulations, that petitioners for
information claimed as trade secret
declare the reasons for their request. It
would go beyond the content of the
statute for EPA to require them to state
that they are citizens of the United
States. When the request of a petitioner
for release of information claimed to be
trade secret is granted, the Agency has
; determined that the information is not,
hi fact, a trade secret.
• As to the export of technical data
through contractors; subcontractors, and
i grantees to the EPA, these authorized
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Federal Regatar / Vol. 53, No. 146 / Friday.July 29, 1988 / Rules and Regulations 2879?
representatives of EPA are .required to
sign confidentiality agreements-and to
provide full confidentiality protection.
Vn. Disclosure to Health Professionals
Section 323 of Title IH consists of
three provisions regarding access to
chemical identity information by health
professionals. These provisions require
the facility owner or operator to disclose
the chemical identity, including trade
secret chemical identity, to a health
professional for diagnosis or treatment
in both non-emergency and emergency
situations, and for purposes of
conducting preventive research studies
and providing medical treatment by a
health professional who is a local
government employee: The health
professional must sign a statement
regarding his need for the chemical
identity, and a confidentiality,
agreement, prior to disclosure, except in
emergency situation* when these two- .
documents may be defivered later.
One commeater requested that EPA
delete entirely th* requirement to .'
provide specific chemical identity to
health professionals. The commenter
indicated that, in it* experience; health
professionals were mere concerned; with
obtaining detailed health and safety :
data than the specific chemical identity.
However, the commenter overlooks the -
fact that the provision of the specific
chemical identity, under specified
circumstances, is a direct requirement of
section 323 of Title EL EPA cannot alter
the basic requirements of the statute.
Health professionals may obtain trade
secret information for the three purposes
set out in the statute. However, they are
required to sign a confidentiality
agreement and a statement of need
stating that they need the information
for the purposes set out in the statute.
/L Non-emergency Diagnosis or
Treatment
The first provision, part (aj of section
323, requires that in non-emergency
situations, an owner op operator of a
facility which is subject to the
requirements of sections 311..312, or 313,
shall provide the specific chemical
identity, if known, of a hazardous
chemical, extremely hazardous
substance, or a toxic chemical to a
health professional who requests the
identity in writing and describes in a
written statement of need described
below a reasonable basis for suspecting .
that the specific chemical identity is
needed for diagnosis or treatment of as
individual or individuals who have been •
exposed to the chemical'concerned. The
health professional must also state that
knowledge of the specific chemical
identity will assist in diagnosis or
treatment of the exposed individual(s).
The health professional must certify that
the information contained'in the
statement of need is true and accurate.
The health professional must also
provide a signed confidentiality
agreement described in VILE to the
facility prior to gaining access to trade
secret chemical identity. Any health
professional performing diagnosis' or
treatment not solely doctors or nurses,
is permitted access to trade secret
chemical identity in a non-emergency
situation. ' •
B. Emergency Situations
The second provision of section 323
deals with medical emergencies and
requires an owner or operator of a
facility subject to the requirements of
sections 311,312, or 313 to immediately
provide a copy of an MSDS, an
inventory'form, or a toxic chemical
release form, including die specific
chemicai identity, if known, of a .
hazardous chemical, extremely
hazardous substance, or a toxic " '
chemical, to any treating physician or •
nurse who requests the chemical
identity under emergency conditions as •
specified ia the statute; The treating
physicians or nurses-must determine •
that- (lj a medical emergency exists; (2f
the specific identity of the-chemical "
concerned is necessary for or wiH assist
in emergency-or first-Hid diagnosis or
treatment and (3) the individual or .
individuals being diagnosed or treated
have been exposed to the chemical
concerned.
In response to public comments, EPA
considered whether health professionals
other than treating physicians and '
nurses (such as commercial spill
contractors, paramedics, and other '
emergency medical services workers)
should be provided access to trade
secret chemical identities under this
provision. The Agency decided that only
treating physicians and nurses are
entitled to such access, in accordance
with the specific wording of the statute
and following the intent of the OSHA
provisions. In a medical emergency, only
the doctor or nurse will conduct the
medical examination and diagnose the
necessary treatment. Most necessary
information could be obtained from
MSDSs and other Title IH forms.
Consequently,, it is not necessary for
personnel other than doctors and nurses
to have access to trade secret
information.
The requesting physician or nurse in
such an emergency does not need to : :
submit a written confidentiality
agreement or statement of need prior to
receiving the trade secret chemical
identity.The owner OF operator ••
disclosing such information may,
however, require a written
confidentiality agreement and statement
of need as soon as circumstances
permit.
Some industry commenters on the
proposed rule expressed concern that
although they would be willing to ;
provide information in the case of a true
emergency, that the procedures therein
would not provide adequate protection
against fraudulent attempts,to obtain
confidential information. EPA
considered requiring procedures such as
phone calls or the development of a
system of identification numbers. These
procedures, however, would be
burdensome, beyond the scope of the
statute and of limited efficiency for the
various scenarios possible in emergency
situations. For these reasons, EPA
decided not to recommend a specific
verification procedure. If the facility
wishes to verify that the situation is an
emergency, the facility must do so
without compromising the need to
immediately provide the information
requested by treating physicians and
nurses. Chemical identities absolutely
. may not be disclosed or used for any
purpose other than the proper treatment
and diagnosis of a chemically related
injury or illness.
C. Preventive and Treatment Measures
The third provision of section 323
deals with preventive and treatment
measures by local health professionals.
This subsection is intended to allow
local health professionals access to
information on chemicals in order to
facilitate epidemiologicai and
lexicological research and to render
medical treatment for the effects of
chemical exposures. This subsection
requires an owner or operator of a
facility to promptly provide the specific
chemical identity, if known, of a
hazardous chemical, an extremely
hazardous substance, or a toxic
chemical to any health professional who
is a local government employee or under
contract with a local government who
submits a request in writing and
provides a written statement of need
and a confidentiality agreement. The
statement of need must describe one or
more of- the needs set forth in the
regulations.
Under this section of the statute,. EPA
interprets the term "health professional"
to be any health professional with the
professional expertise to perform, the
types of research arid'treatment set forth
hi the statute, and who is employed by
the local government. Under this
section, such health professionals as '
physicians, toxicologists-and .•
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Federal Register / Vol. 53. No. 146 /
a*<* Regulation
epidemiologists may gain access to
trade secret chemical identity.
A few industry commenters argued ,
that a provision should be made for
allowing disclosure of relevant health
effects information other than the
chemical identity in this preventive and
treatment measures section. They
asserted that other information will be
sufficient to conduct the listed types of
studies and surveillance. EPA considers
it Inappropriate to place regulatory
limitations on the six statutory ,
situations in which health professionals
may seek disclosure of chemical
identities because they are explicitly
mentioned in the statute.
D. Statement of Need
In Ihe proposed rule, EPA requested
comment concerning whether the
statement of need should contain a
detailed description of why the
disclosure of the following information
would not be sufficient to enable the
health professional to provide medical •
services: (a) The properties and effects -
of the chemical, (b) measures for
controlling the public's exposure to the
chemical (c) methods of monitoring and
analyzing the public's exposure to the
chemical, and (d) methods of diagnosing
and treating harmful exposure to the
chemical. These are the provisions in-
the Occupational Safety and Health Act
Hazard Communication Standard. One *
commenter objected strongly, to the
inclusion of these provisions, citing the
paramount interest in allowing health .
professionals to "undertake their own
independent course of treatment, and
hopefully to prevent future disease."
Industry commenters, on the other hand,
asserted that, in the vast majority of
cases, information necessary for
diagnosis and treatment can be
provided without disclosing specific
chemical identity. They argued for a
presumption against disclosure, which
would justify a higher standard for the
health professional to meet in
demonstrating that trade secret
information should be disclosed.
The Agency has decided not to
explicitly include the OSHA provisions
in the final rule. The statutory
requirement that a health professional
describe "a reasonable basis" why the
specific chemical identity is needed will
implicitly explain why other information
would not be sufficient The Agency
believes the OSHA provisions would be
unnecessary.
£, Confidentiality Agreement
The confidentiality agreement.
required of the health professional must
state that the health professional will
not use the trade-secret chemical
identity for any purpose'other than the
health needs asserted hi the statement
of need, or as may otherwise be
authorized by the terms of the
agreement itself. This .agreement may be
negotiated between the health
professional and the facility.
The provisions in the confidentiality
agreement will enable the health
professional to clearly understand the
extent of disclosures permissible. At a
minimum, the written confidentiality
agreement shall include a description of
the procedures to be used to maintain
the confidentiality of the disclosed
information and a statement by the
health professional that he will not use
the information for any purpose other
than the health needs asserted in the
statement of need. Also, the health
professional must agree not to release
the information under any
circumstances, except as authorized by
the terms of the agreement However,
this authorized disclosure may be
structured so that the health
professional may release the trade
secret chemical identity to other health
professionals if the professionals
routinely rely on each other's expertise
for needed advice. The agreement may
also specify that the first health
professional may. disclose the trade
secret chemical identity to other health
professionals if suph disclosure is
.necessary in order for the first
'professional to-learn necessary-
information to render a professional
opinion. Except in those instances.
specified in the confidentiality
agreement the health professional may
not be permitted to release the
information to other health
professionals. The health professional
may be permitted to write articles for
medical journals or to go on speaking
tours discussing the chemical involved if
such activity does not result in the
disclosure of the identity of the chemical
and the facility's relationship to that
chemical
The proposed rule included a
reasonable pre-estimate of damages as
an appropriate legal remedy in the event
of a breach of the confidentiality
agreement. Commenters expressed
concern that inclusion of pre-estimates
of damages in confidentiality
agreements may have a chilling effect on
health professionals, discouraging them
from entering into such agreements.
Many health professionals may be
unable or unwilling to assume the
liability associated with such a
provision in exchange for obtaining
information necessary for them to
provide proper treatment or diagnosis.
Several commenters characterized this
liability as "unreasonable" and "not
'contemplated by the legislation." EPA
agrees with the commenters and the
provision for a pre-estimate of damages
ihas been deleted from the final rule. The
iAgency believes that the underlying
purpose of the confidentiality agreement
iis to protect a facility's trade secret
'chemical identity from unlimited and
unbridled disclosure, not to make it
: overly burdensome or difficult for the
.health professional to obtain the specific
identity of a chemical.
1 This confidentiality agreement is
i subject to State law and State
i contractual remedies. Also, nothing in
i this regulation precludes the facility or
i health professional from pursuing non-
contractual remedies to the extent
permitted by law.
IF. Related Issues
'-. Following .the receipt of a written
• request, the facility owner or operator to
: whom such request is-made shall
, promptly provide the requested
1 information to the health professional.
j EPA considered specifically defining
, "promptly" and "immediately" to mean
i a particular number of days. Two
commenters discussed the Agency's
! failure to define the term "immediately"
in the context of the requirement to
' release chemical identification
i information to health professionals. One
; of these commenters asked that the
Agency define the term, while the other
i commenter expressed support for the
1 Agency's decision to not specify a
j particular time period to provide the
• information. For the reasons stated
'! above, the Agency will refrain from
I defining "immediately" more
i specifically. The Agency did not receive
any comments on this issue and has
decided not to define the terms because
of the concern that defined times will
limit the speed of response. The statute
requires "immediate" provision of data
in the case of medical emergencies and
EPA interprets this to mean that the
owner or operator will provide the data
over the telephone, without requiring a
written statement of need or a
confidentiality agreement in advance.
As stated in the proposed rule, the
Agency is aware of the possible
situation where the owner or operator of
a facility is unable to provide the
chemical identity because the
manufacturer of the chemical has kept
the identity confidential. In these
situations, EPA suggests that the owner
or operator of the facility put the
requester in touch with the supplier of
the chemical, but the facility is not
responsible for supplying information
which it cannot obtain for itself.
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EPA received a comment that if a
patient becomes aware, OP wishes to
learn, the chemical identity .of a
substance he was exposed to, he should
be required to sign a confidentiality
agreement'Since the provisions of
section 323 deal only with the release of
information to health professionals, the
Agency cannot require disclosures to
patients as part of this rulemaking.
The regulation authorizes health
professionals to refer to trade secret
chemical identity in discussions with
EPA personnel, who themselves are
authorized to have access to Title III
trade secret information. This is based
on a provision of the OSHA Hazard
Communication Standard:. Several
commenters suggested that the Title III
regulations should restrict the release of
confidential information from health
professionals to EPA to a greater extent
than was provided in the proposed rule.
Specifically, several commenters stated'"
that Title III trade secret regulations
should mirror the procedures- in the
.' OSHA Hazard' Communication
Standard, which requires that the
government provide notice to the facility
owner or operator whenever a health
professional transmits trade secret
information to the government agency.
Based on the comments, EPA considered
three options for restricting releases of
trade secret information from health,
professionals to the Agency. First, EPA
considered the addition of a requirement
similar to OSHA's that notice be given
to the facility owner or operator
whenever a health professional provides
trade secret information to EPA. The
second option considered was the
limitation of communications between
EPA and the health professional to the
generic class or category, in non-
emergency situations. The third option
considered was to establish procedures
similar to Confidential Business
Information (CBI) Procedures utilized
under TSCA. In this option, the health
professional would be required to verify
that an EPA employee is on a CBI
authorized access list before disclosing
trade secret chemical identities.
EPA evaluated the options and
decided that each one would impede
timely transmission-of important health
effects data necessary for proper
diagnosis and treatment. The .procedures
would be administratively cumbersome
and they are not explicitly required by
the statute. The Agency is already fully ,
aware of the necessity taprotect trade
secret information and believes
additional procedures .are unnecessary.
EPA construes section 323. to mean :
that a facility is not permitted', to deny
disclosure of a specific chemical identity
to a health professional under any
circumstances provided-there is a
written statement of need and a written
confidentiality agreement. Section 325(cj
empowers EPA to assess civil penalties
of up to $10,000 for failure to disclose the
trade secret chemical identity to health
professionals in emergency situations,
as required by section 323(b}. Health
professionals may also sue under
section 325(e) in U.S. District Court to
obtain the information.
VIII. Summary of Supporting Analyses
A. Regulatory Impact Analysis
1. Purpose
Executive Order (E.O.) No. 12291
requires each federal agency to
determine if a regulation is a "major"
rule as defined by the Order and to
prepare a Regulatory Impact Analysis
(RIA) in connection with each, major
rule. EPA has determined that the
requirements and procedures
established in this rulemaking for
treatment of chemical data considered
to-be trade secret by facilities reporting
under other sections of Title IH do not
constitute a major rule under E.O. No.
12291. The Agency has prepared an
economic analysis to assess the
economic impacts of the final regulation
on affected industry and government
entities. The following summary of '
results are presented in detail in
Regulatory Impact Analysis in Support
of Final Rulemaking under Sections
322-323 of the Superfund Amendment
and Reauthorization Act of 1986.
2. Methodology
EPA conducted an assessment of the
costs and benefits associated with this
final rule and the primary provisions of
sections 322 and 323, including the
preparation of trade secrecy claims by
facilities; the processing and storing of
claims by EPA; the public petition and
review process; the provision of adverse
health effects data for chemicals whose
identities are withheld as trade secrets;
and special access procedures under
which facilities must promptly provide
chemical data to members of the health
profession.
This analysis considered the costs
that five groups will incur as a result of
the rule and the section 322-323
provisions. These five groups are:
facilities, EPA, public petitioners. States,
and health professionals.
The economic analysis conducted for
the final rule took into account public • •
comments on the proposed-rule and
modifications made to other Title III
reporting provisions. Among the changes
incorporated into-the-economic analysis
supporting the final rule are the trade
secret claims made by non-
manufacturihg facilities submitting
reports under sections 311 and 312 of
SARA; increased costs for the public
petition and review process; and
consideration of the potential for cost
savings per claim that may result when
facilities file trade secret claims for the
same chemical under different Title III
reporting sections.
The economic analysis for the final
rule confirms that facilities will make
trade secret claims in about 0.1 percent
of the reports submitted under Title III.
This confirmation is based on the low
number of trade secret claims having
actually been made fay facilities in 1987
during the first round of reporting under
section 311 of SARA^
3. Results
The economic analysis conducted for
the final rule estimated the costs that
would b^iricurred by each of the five
groups affected by the rule and the
statutory provisions. The aggregate
present value costs during the first 10
. years of Title III reporting, using a
discount rate of 4 percent are estimated
ta be approximately $67.6 million, or an
average of $6.8 million annually. The
following discussion summarizes the
costs that each of the major groups is
estimated to incur.
Facilities. Industrial facilities incur
the largest amount of costs in preparing
and filing trade secret claims. They also
will incur costs when they respond to
public petitions challenging their trade
secret claims and when they provide
trade secret information to health
professionals.
Facilities will incur the greatest costs
in 1990, when the section 311 MSDS
reporting threshold for non-
manufacturing facilities is assumed to
decline from 10,000 pounds to 500
pounds. The 1990 facility costs are
estimated in the analysis to be
approximately $26.4 million.
The analysis also estimates the costs
of an individual facility filing a trade
secret claim for the first time and the
costs to file subsequent trade secret
claims. An average facility will incur
costs of approximately $1,100 when it
files its first trade secret claim, and
between $270 and $563 when it files a
subsequent claim; depending on-the type
of claim made. If the public challenges a
trade secret claim that a facility makes,
the analysis estimates that a facility will
incur an average of about $1,300 dollars
to provide supplemental information to
support the original substantiation. The :
analysis also estimates that these costs
could range as high as> $3,400 if a
facility's claim is rejected by EPA and
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Federal Rejdsterf Volr S3i-'N
approximately $4,200 in each |
subsequent year tor develop profiles for
new chemicals that facilities claim trade
secret. !
Health Professionals, The analysis.
estimates that the aggregate present
• value costs to health professionals will
be approximately $372.000 during tile :
first ten years- of Title HI reporting, or .
approximately $37,20O annually. The
analysis also- estimates that health i
professionals will incur a range of costs
between $110 and $140 in making a :
request of a facility for a trade secret:
depending on the particular j
circumstances of the request as >
described under section 323 of the rule.
Sensitivity Analyses. After calculating
aggregate costs for each of the five :
groups, eight sensitivity analyses were
conducted to test the effect of important
assumptions on the total-costs of the i
rule. These analyses included the- !
number of trade secret claims that i •
facilities will file, the costs of filing a •
trade secret claim; the likely effect of! '
linkage on the number of trade secret •
claims, the number of Tier II claims
under section 312, the number of
petitions that the public files challenging
facility trade secret claims, the number
of requests for adverse health effects-
information, arid the number of requests
health professionals make for the
identity of trade secret chemicals.
The sensitivity analyses demonstrated
that the costs of the final rule are most
sensitive to the number of trade secret ,
claims that facilities will file and the
costs of filing each claim.
Benefits. Benefits may arise as a
result of this rule both for facilities and
for the public. Relationships among the
activities undertaken by Various
affected groups are complex and only a
qualitative discussion of benefits is
included in the economic analysis. For
facilities, direct benefits may include
protection of trade secrets involving
chemicals used in production processes,
that, by definition, involve information
that permit a facility to have a
competitive advantage over another
facility. For the public, the rule provides
a petition and review process that
allows challenge of the validity of a
trade secret claim through an.
administrative review, process, and.
allows health effects, information to be
disclosed! without jeopardizing the
competitive position of the facility.
B. Regulatory Flexibility Analysis
1. Purpose
Under the Regulatory Flexibility Act
of 1980, a Regulatory Flexibility
Analysis must be performed for all rule
that are likely to have a "significant
impact on a substantial number of small
entities" (small businesses, small
organizations, and small governmental
jurisdictions). The analysis contained in
this economic analysis addresses the
impact of this rule on small entities,
Based on this analysis, EPA has
concluded that although a large number
of small businesses reporting under Title
m could be affected by this rule, the
costs of the rule generally will be low on
a per facility basis and that significant
impacts will not result.
2. Methodology and Results
In order to assess the likely economic
impacts that this final rule will have on
small businesses, EPA compared likely
average-costs for small facilities to file a
trade secret claim with median sales for
those facilities, and evaluated whether
the rule likely would affect a substantial
number of small entities.
The results-of the economia analysis
show generally that the cost of filing a
trade secret claim will not be a burden
on facilities because the likely costs of
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and.Regula'tions
28801
filing a trade secret claim under a worst
case scenario tested in thei analysis are
less than one percent of median sales.
EPA defined small businesses in this
analysis to be those with fewer than 20
employees. The number of small
businesses tinder this definition is
estimated to be approximately 2,794,400
facilities (the universe of facilities in
categories covered by section 303, the
broadest of the sections associated with
trade secrecy claims). The economic
analysis conducted for the final rule .
estimates that approximately 61,600
facilities will file trade secret claims
during the first ten years of Title HI
reporting. If all facilities filing trade
secret claims met the definition of
"small business," this would encompass
only 2.2 percent of small businesses,
well below the usual level'df 20 percent
. established by EPA to represent a
"substantial" number of small facilities.
3. Certification
On the basis of the analyses •
contained in the economic analysis with
respect to the impact of this rule on
small entities, I hereby certify that this
rule will not have a significant impact
on a substantial number of small •
entities. This rule, therefore; does not
require a Regulatory Flexibility
Analysis. . .
C. Paperwork Reduction Act
Public reporting burden for this
collection of information is estimated to
vary from 27.7 to 33.2 hours per-
response, with an average of 28.8 hours
per response, including time for
reviewing instructions, searching
existing data sources, gathering and
maintaining the data needed, and
1 completing and reviewing the collection
of information. Send comments:
regarding the burden estimate or any
other aspect of this collection of
information, including suggestions for
reducing this burden, to Chief.
Information Policy Branch. PM-223, U.S.
Environmental Protection Agency. 401M
Street SW.. Washington, DC 20460; and
to the Office of Information and
Regulatory Affairs, Office of
Management and Budget, Washington,
DC 20503.
OMB has reviewed the information
collection requirements contained in this
rule under the provisions of the' .
Paperwork Reduction Act of 1980.44
U.S.C. 3501 etseq. and has assigned
OMB Control Number 2050-0078.
List of Subjects in 40 CFR Part 350
Chemicals, Hazardous substances.
Extremely hazardous-substances, Toxic
chemicals, Community right-to-know,
Superfund Amendments and
• Reauthorization Act, Trade secrets.
Trade secrecy claims, Intergovernmental
relations.
Dated: July 21,1988.
Lea M. Thomas,
Administrator.
For the reasons set out in the
Preamble, Title 40 of the Code of Federal
Regulations is amended by adding a
new Part 350 to read as follows: .
PART 350—TRADE SECRECY CLAIMS
FOR EMERGENCY PLANNING AND
COMMUNITY RIQHT-TO-KNOW
INFORMATION: AND TRADE SECRET
DISCLOSURES TO HEALTH
PROFESSIONALS
Subpart A—Trad* Secrecy Claims
.. Sec.. • ' :
350.1 Definitions. ''-•'-.
350.3 Applicability of subpart; priority
where provisions conflict; interaction
with 40 CFR Part 2.
35O5 Assertion of claims of trade secrecy.
350.7 Substantiating claims of trade secrecy.
350.9 Initial action by EPA.
350.11 Review of claim.
350.13 Sufficiency of assertions.
350.15 Public petitions requesting disclosure.
of chemical identity claimed as trade
. secret
350.18 Address to send trade secrecy claims,
and petitions requesting disclosure.
350.17 Appeals.
350.18 Release of chemical identity
determined to be non-trade secret; notice
of intent to release chemical identity.'
350.19 Provision of information to States:
350.21 Adverse health effects.
350.23 Disclosure to authorized
representatives.
350.25 Disclosure in special circumstances. ' •
350.27 Substantiation form to accompany
claims of trade secrecy, instructions to
substantiation form.
Appendix A—Restatement of Torts section
757, comment b
Subpart B—Oisctosure of Trada Secret
Information to Health Professionals
350.40 Disclosure to health professionals.
Authority: 42 U.S.C 11042.11043 and 11048
Pub. L. 89-489.100 Stat 1747.
Subpart A—Trad* Secrecy Claims
§350.1 Daflnitfons.
"Administrator" and "General
Counsel" mean the EPA officers or -
employees occupying the positions so
titled.
"Business confidentiality" or
"confidential business information"
includes the concept of trade secrecy
and other related legal concepts which
give (or may give) a business the right to
preserve the confidentiality of business
information and to limit its use or
disclosure by others in order that the -
business may obtain or retain business
advantages it derives from its right in
the information. The definition is meant
to encompass any concept which
authorizes a Federal agency to withhold
business information under 5 U.S.C.
552(b)(4), as well as any concept which
requires EPA to withhold information
from the public for the benefit of a
business under 18 U.S.C. 1905.
"Claimant" means a person
submitting a claim of trade secrecy to
EPA in connection with a chemical
otherwise required to be disclosed in a
report or other filing made under Title
in.
"Petitioner" is any person who
submits a petition under this regulation
requesting disclosure of a chemical
identity claimed as trade secret.
"Sanitized" means a version of a
document from which information
claimed as trade secret or confidential
has been omitted or withheld.
"Senior management official" means
an official with management
responsibility for the person or persons
completing the report, or the manager of
environmental programs for the facility
or establishments, or for the corporation
owning or operating the facility or
establishments responsible for certifying
similar reports under other
environmental regulatory requirements. .
"Specific chemical identity" means
the chemical name. Chemical Abstracts
Service (CAS)-Registry Number, or any :
other information that reveals the
precise chemical designation of the
substance. Where the trade name is
reported in lieu of the specific chemical
identity, the trade name will be treated
as the specific chemical identity for
purposes of this part.
"Submitter" means a person filing a
required report or making a claim of
trade secrecy to EPA under sections 303
(d}(2) and (d}(3), 311, 312, and 313 of
Title ffl.
"Substantiation" means the written
answers submitted to EPA by a
submitter to the specific questions set
forth in this regulation in support of a
claim that chemical identity is a trade
secret.
"Title HI" means Tide ffl of the
Superfund Amendments and
Reauthorization Act of 1988, also titled
the Emergency Planning and Community
Right-to-Know Act of 1988.
.'Trade secrecy claim" is a submittal
under sections 303 (d)(2) or (d}(3), 311,
312 or 313 of Title ffl in which a
chemical identity is claimed as trade
secret; and is accompanied by a
substantiation in support of the claim of
trade secrecy for chemical identity.
• "Trade secret" means any
confidential formula, pattern, process,
device-, information or compilation of
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information that la used in a submitter's
business, and that gives the submitter an
opportunity to obtain an advantage over
competitor* who do-not know or use iL
EPA intends to be guided-by the.
Restatement of-Torts,. section 757;
comment b.
"UnsanWzed'* means a version-of a
document from, which information
claimed as trade- secret or confidential
has not been withheld or omitted.
"Working day" is any day on: which
Federal government offices are open for.
normal business. Saturdays. Sundays.
,and official Federal holidays are not
working days; all other days are.
§S5&3 Applc«b«ty of setopart; priority
vriw» pro vision* coofflct; hrt««ction wttrr
40CFBP»rtZ -
(*) Applicability of subpart. Sections
350.1 through 35O27 establish rules-
gacv*nringf assertion of trade secrecy -
daima foe thtr™1™* identity informatioci; *
collected ondct the authority of. sections
303. (d}(2> and fd){3), 311,312 andJ313 of
Titli III of thaSuperfimd Amendments.
and Reauthorization: Act of-1988, and for
trade secrecy or business confidentiality.
claim* foTinfonnation-submitted in a
substantiation under sections 303 (d)(2),
and (dM33» 3tt 312; and 313 of Title JIL
Thissubpart also, establishes ruler.
governing petitions front the public
requesting the disclosure- of- chemical
Identity claimed as trade secret, and
determinations by EPA of whether this
Information is entitled to trade secret
treatment Claims for confidentiality of
* the location of a hazardous-chemical
under section 312{dK2)(F} of Tittem are
not subject to the requirements of this- •
subpart
(b) Priority where provisions conflict.
Where information subject to the
requirements of this-subpart is also
collected under another statutory
authority. th« confidentiality, provisions.
of that authority shall be used to claim "
that information as-trade secret or
confidential when submitting it to EPA
under that statutory authority.
(c) Interaction with 40CFR Part 2.
EPA's Freedom of Information Act
procedures. (1) No trade secrecy or
business confidentiality claims other
than those allowed hi this subpart are
permitted for information collected
under sections 303 (d)(2) and (d)(3), 311.
312 and 313 of Title m.
(2) Except as provided in § 350.25 of •
this subpart, request for access to
chemical identities withheld as trade"
secret under this regulation is solely
through this regulation and procedures
hereunder, not through EPA's Freedom
of Information Act procedure* set forth
at40CFRl'ar2.
(3) Request for access to information
other than chemical identity submitted
to EPA under this regulation is through
EPA's Freedom of Information Act |
regulations at 40 CFR Part 2.. I ;
§351X5 Assertion of claims of trade •
secrecy. . !
(a) A claim of trade secrecy may be j
made only for the specific chemical i
identity of an extremely hazardous ;
substance under sections 303 [d)(2) and
(d)(3). a hazardous chemical under !
sections 311 and 312, and a toxic i
chemical under section 313. i
(b) Method of asserting claims of >
trade secrecy for information submitted
under sections 303 (d)(2) and (d)(3)., |
(1> In submitting information to the,
local emergency planning committee
undersectiona 303 (d)(2) or (d)(3), the '.
submitter may claim as trade secret the
specific chemical identity of any '
chemical subject to.reporting-undet i
sectionSOS; >
• (2J To make a daim; the submitter
.shall submit to-EPA ttta-foHbwingr
(i) A copy of the information which is.
being submitted under sections 303 i
(d]{2) or (d)(3J to the local'emergency ;
planning committee, with the chemical
identity or identities claimed trade i
secret deleted, and the generic dass or
category of the chemical identity or 1
identities inserted In its place; The i
method of choosing generic dass or ;
category is set forth, in paragraph (f) of
this section.
(it) A sanitized ancLunaamtized •• >
substantiation in accordance with- - j
§. 350.7-for each chemical identity
claimed as trade secret ,
(3) If the submitter wishes to claim
information in the substantiation as ; .
trade secret or business confidential. j[t
shall do so in accordance with '
§ 35O7(d).
. (4} Section 303 daims shall be sent ;to-
the address specified in 4 350.1ft of this-
regulation. • . j
(c) Method of asserting daims of trade
secrecy for information submitted under
section 311. \
(1) Submitters may claim as trade ;
secret the specific chemical identity of
any chemical subject to reporting under
section 311 on the material safety data
sheet or chemical list under section 311,
(2) To assert a daim, for a chemical
identity on a material safety data sheet
under section 311, the submitter shall
submit to EPA the following: '
; (i) One copy of the material safety
data sheet which is being submitted to
the State emergency response
commission, the local emergency
planning committee and the local fire
department which shall make it
available to the public. In place of the
specific chemical identity daimed as
trade secret, the generic-class or
category of the chemical claimed as
trade secret shall be inserted. The
method of choosing generic class or
category is set forth in paragraph (f) of
this section.
(ii) A sanitized and unsanitized
substantiation in accordance with
§ 350.7 for every chemical identity
claimed as trade secret.
(3) To assert a daim for a chemical
identity on a list under section 311. the
submitter shall submit to EPA the
following:
(i) An unsanitized-copy of the
chemical list under-section 311. The
submitter shall clearly indicate the
specific chemical identity daimed as
trade secret and shall label it "Trade
Secret" The generic dass or category of
the chemical claimed aa trade secret
shall be inserted directly below the
daimed chemical identity. The method
of choosing generic dass or category is
set forth in. paragraph, (ft of this section-
(ii) A sanitized copy of the chemical
list under section 311. This copy shall be
identical to the document-in paragraph.
(c)(3)(i}of this section except that, the
submitter shall delete the chemical
identity daimed aa trade secret leaving
in place the generic class or category of
the chemical daimed as trade secret.
This copy shall be sent by the submitter
to the State emergency response
commission, the local emergency
planning committee and the local fire
department which, shall make it
available to the public.
(iii) A sanitized and unsanitized-
substantiation in accordance with
§ 350.7 for every chemical identity
claimed as trade secret.
(4) If the submitter wishes to claim
information in the substantiation as
• trade secret or business-confidential, it
snail-do so in accordance with
§ 350.7(d).
(5) Section 311 daims shall be sent to
the address specified in § 350.16 of this
regulation.
(d) Method of asserting claims of
trade secrecy for information submitted
under section 312.
(1) Submitters may claim aa trade
secret the specific chemical identity of
any chemical subject to reporting under
section 312.
(2) To assert a daim the submitter
shall submit to EPA the following:
(i) An unsanitized copy of the Tier fl
emergency and hazardous chemical
inventory form under section 312. (The
Tier I emergency and hazardous
chemical inventory form does not
require the reporting of specific
chemical identity and therefore no trade
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146 i
''WMW
Friday» July 29» 198S /
and Regulations
22^03
secresy claims may be made with
respect to that form.} The submitter
shall clearly indicate the specific
chemical identity claimed as trade
secret by checking the box marked
"trade secret" next to the claimed
chemical identity.
(ii) A sanitized copy of the Tier II
emergency and hazardous chemical
inventory form. This copy shall be
identical to the document in paragraph
(d)(2)(i) of this section except that the
submitter shall delete the chemical
identity or identities claimed as trade
secret and include instead the generic
class or category of the chemical
claimed as trade secret. The method of
choosing, generic class or category is set
forth in paragraph (f) of this section. The
sanitized copy shall be sent by the
submitter to the State emergency
response commission, local emergency
planning committee or the local fire
department whichever entity requested
the information.
(iiij A sanitized and unsanitized
substantiation in accordance with
§ 350.7 for every chemical identity
claimed aa trade secret.
(3) If the submitter wishes to claim
information in the substantiation as
trade secret or business confidential, it
shall do so in accordance with
(4} Section 312 claims shall be sent to
the address specified in f 350.16 of this-
regulation.
(e) Method of asserting claims of trade
secrecy for information submitted under
section 313.
(1) Submitters may claim as trade
secret the specific chemical identity of
any chemical subject to reporting under
section 313.
(2} To make a claim, the submitter
shall submit to EPA the following:
(i) An unsanitized copy of the toxic
release inventory form under section 313
with the information claimed as trade
secret clearly identified. To do this, the
submitter shall check the box on the
form indicating that the chemical
identity is being claimed as trade secret
The submitter shall enter the generic
class or category that is structurally
descriptive of the chemical, as specified
in paragraph (f) of this section.
(ii) A sanitized copy of the toxic
release inventory form. This copy shall
be identical to the document in
paragraph (e)(2)(i) of this section except
that the submitter shall delete the
chemical identity claimed aa trade
secret. This copy shall also be submitted
to the State official or officials
designated to receive this- information. .
(iii) A sanitized and unsanitized
substantiation in accordance with
§ 350.7 for every chemical identity
claimed as trade secret
(3) If the submitter wishes to claim
information in the substantiation as
trade secret or business confidential, it
shall do so in accordance with
§ 350.7(d).
(4) Section 313 claims shall be sent to
the address specified in § 350.18 of this
regulation.
(f) Method of choosing generic class
or category for sections 303,311,312 and
313. A facility owner or operator
claiming chemical identity as trade
secret should choose a generic class or
category for the chemical that is
structurally descriptive of the chemical.
(g) If a specific chemical identity is
submitted under Title HI to EPA, or to a
State emergency response commission,
designated State agency, local
emergency planning committee or local
fire department without asserting a
trade secrecy claim, the chemical
identity shall be considered to have
been voluntarily disclosed, andnoa-
trade secret
(h) A submitter making a trade.
secrecy claim under this section shall
submit fo entities other than EPA (e.g., a
designated State agency, local
emergency planning committee and
local fire department} only the sanitized
or public copy of the submission and
substantiation.
§360.7 SubctmftatingeteinwoftnKia
secrecy.
(a) Claims of trade secrecy must be
substantiated by providing a specific
answer including, where applicable,
specific facts, to each of the following
questions with the submission to which
the trade secrecy claim pertains.
Submitters must answer these'questions
on the form entitled "Substantiation to
Accompany Claims of Trade Secrecy" in
§ 350.27 of this aubpart.
(1) Describe the specific measures you
have taken to safeguard the
confidentiality of the chemical identity
claimed as trade secret, and indicate
whether these measures will continue in
the future.
(2) Have you disclosed the
information claimed as trade secret to
any other person (other than a member
of a local emergency planning
committee, officer or employee of the
United States or a State or local
government or your employee) who is
not bound by a confidentiality
agreement to refrain from disclosing this
trade secret information to others?
(3) Liat all local. State, and Federal
government entities to which, you have
disclosed the specific chemical identity.
For each, indicate whether you asserted
a confidentiality claim for the chemical
identity and whether the government
entity denied that claim.
(4) In order to show the validity of a
trade secrecy claim, you must identify
your specific use of the chemical
claimed as trade secret and explain why
it is a secret of interest to competitors.
Therefore:
(i) Describe the specific use of the
chemical claimed as trade secret,
identifying the product or process in
which it is used. (If you use the chemical
other than as a component of a product
or in a manufacturing process, identify
the activity where the chemical is used.)
(ii) Has your company or facility
identity been linked to the specific
chemical identity claimed as trade
secret in a patent, or in publications or
other information sources available to
the public or your competitors (of which
you are aware)? If so, explain why this
knowledge does not eliminate the
justification for trade secrecy.
(iii) If this use of the chemical claimed
aa trade secret is unknown outside your
company, explain how your competitors
could deduce this use from disclosure of
the chemical identity together with other
information on the Title III submittal
form.
(ivj Explain why your use of the
chemical claimed as trade secret would
be valuable information to your
competitors.
(5) Indicate the nature of the harm to
your competitive position that would
likely result from disclosure of the
specific chemical identity, and indicate
why such harm would be substantial.
(6](i) To what extent is the chemical'
claimed as trade secret available to the
public or your competitors in products,
articles, or environmental releases?
(ii) Describe the factors which
influence the cost of determining the
identity of the chemical claimed as trade
secret by chemical analysis of the
product article, or waste which contains
the chemical (e.g.* whether the chemical
is in pure form or is mixed with other
substances).
(b) The answers to the substantiation
questions listed in paragraph (a) of this
section are to be submitted on the form
in § 350.27 of this subpart, and included
with a submitter's trade secret claim.
(c) An owner, operator or senior
official with management responsibility
shall sign the certification at the end of
the form contained in § 350.27. The
certification in both the sanitized and
unsanitized versions of the
substantiation must bear an original
signature;
(d) Claims of confidentiality in the
substantiation. (1) The submitter may
claim a» confidential any trade secret or
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28804
Federal Renter / Vol. 53,.No. 146 / Friday. July 29> 198g|/ Rutes and Regulation*
confidential business information
contained in the substantiation. Such
claims for material in the substantiation
are not limited to claims of trade
secrecy for specific chemical identity,
but may also include claims of
confidentiality for any confidential
business information. To claim this
material as confidential, the submitter
shall clearly designate those portions of
the substantiation to be claimed as
confidential by marking those portions
"Confidential," or 'Trade Secret"
Information not so marked will be
treated as public and may be disclosed
without notice to the submitter.
(2) An owner, operator, or senior
official with management responsibility
shall sign the certification stating that
those portions of the substantiation
claimed as confidential would, if
disclosed, reveal the chemical identity
being claimed as a trade secret, or •
would reveal other confidential business
or trade secret information, this ;
certification to combined on the
substantiation form in § 3SO27 with, the
certification described in paragraph (c)
of this section.
(3) The submitter shall submit to EPA.
two copies of the substantiation, one of
which shall be the unsanitized version,
and the other shall be the sanitized
version.
(i) The unsanitized copy shall contain
alt of the information claimed as trade -
secret or business confidential marked
as indicated in paragraph fd){lj of this
section.
(lil The second copy shall be identical
to the unsanitized substantiation except
that it will be a sanitized version, in
which all of the information claimed as
trade secret or confidential shall be
deleted. If any of the information
claimed as trade secret in the
substantiation is the chemical identity
which is the subject of the
substantiation, the submitter shall
include the appropriate generic class or
category of the chemical claimed as
trade secret. This sanitized copy shall
be submitted to the State emergency
response commission, a designated
. State agency, the local emergency
planning committee and the local fire
department, as appropriate, and made
publicly available.
[e] Supplemental information. (1) EPA
may request supplemental information
from the submitter in support of its. trade
secret claim, pursuant to § 350.11(a)(l).
EPA may specify the kind of inf brmation
to be submitted, or the submitter may
submit any additional detailed
information which further supports the
truth of the information previously
supplied to EPA in its initial
substantiation, under this section.
(2) The submitter may claim aa
confidential any trade secret or
confidential business information
contained in the supplemental
information. To claim this material as
confidential, the submitter shall clearly
designate those portions of the
supplemental information to be claimed
as confidential by marking those
portions "Confidential," or "Trade !
Secret" Information not so marked will;
be treated as public and may be >
disclosed without notice to fee >
submitter. ,
(3) If portions of the supplementary ;
information are claimed confidential, an
owner, operator, or senior official with i
management responsibility of the ;
submitter shall certify that those |
portions of the supplemental ;
information claimed as confidential
would, if disclosed, reveal the chemical
identity being claimed as confidential or
would reveal other confidential business
or trade secret information.
{4J If supplemental information ia |
requested by EPA and the submitter
claims portions of it as- trade secret or !
confidential, then the submitter shall ;
submit to EPA two copies of the
supplemental information, an '.
unsanitized and a sanitized version.
(i)'The unsanitized version shall
contain all of the information claimed aa
trade secret or business confidential, • \
marked as indicated above in paragraph
(e)(2) of this section.
(ii) The second copy shall be identical
to the unsanitized substantiation except
that it will be a sanitized version, in ;
which all of the information claimed as
trade-secret or confidential shall be
deleted. If any of the information " |
claimed as trade secret in the '
supplemental information is the
chemical identity which is the subject of
the substantiation, the submitter shall
include the appropriate generic class or
category of the chemical claimed as ;
trade secret i
§ 350.9 Initial action by EPA. ,
(a) When a claim of trade secrecy, ,
made in-accordance with § 350.S of this
part, is received by EPA, that ;
information is treated as confidential i
until a contrary determination is made.
" (b) A determination aa to the validity
of a trade secrecy claim shall be ;
initiated upon receipt by EPA of a j
petition under § 350.15 or may be
initiated at any time by EPA if EPA
desires to determine whether chemical
identity-information claimed as trade;
secret is entitled to trade secret ,
treatment, even though no request for
release of the information has been ;
received. :
(c) If EPA initiates a determination as
to the validity of a trade secrecy claim,
the procedures set forth in §§ 350.11.
350.15. and 350.17 shall be followed in
making the determination.
(d) When EPA receives a petition
requesting disclosure of trade secret
chemical identity or if EPA decides to
initiate a determination of the validity of
a trade secrecy claim for chemical
identity, EPA shall first make a
determination that the chemical identity
claimed as trade secret is not the subject
of a prior trade secret determination by
EPA concerning the same submitter and
facility, or if it is, that the prior
determination upheld the submitter's
claim of trade secrecy for that chemical
identity at that facility.
(1) If EPA determines that the
chemical identity claimed as trade
secret is not the subject of a prior trade
secret determination by EPA concerning
the same submitter and the same
facility, or if it is, that the prior
determination upheld the submitter's
claim of trade secrecy, then EPA shall
review the submitter's claim according
to § 350.11.
(2) If such a prior determination held
that the submitter's claim for that
chemical identity is invalid, and such
determination was not challenged by
appeal to the General Counsel, or by
review in the District Court or, if .
challenged, was upheld, EPA shall notify
the submitter by certified mail (return
receipt requested) that the chemical
identity claimed as trade secret is the
subject of a prior, final Agency
determination concerning the same
facility in which it was held that such a
claim was invalid. In this notification
EPA shall include notice of intent to
disclose chemical identity within 10
days pursuant to § 350.18(c) of this
subpart. EPA shall also notify the
petitioner by regular mail of the action
taken pursuant to this section.
$350.11 Review of daim.
(a) Determination of sufficiency.
When EPA receives a petition submitted
pursuant to § 350.15, or if EPA initiates a
determination of the validity of a trade
secrecy claim for chemical identity, and
EPA has made a determination, as
required in paragraph (d)(l) of § 350.9,
then EPA shall determine whether the
submitter has presented sufficient
support for its claim of trade secrecy in
its substantiation. EPA must make such
a determination within 30 days of
receipt of a petition. A claim of trade
secrecy for chemical identity will be
considered sufficient if, assuming all of
the information presented in the
substantiation is true, this supporting
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Federal Register / Vol., 5& Pfov 14fr / Friday, July 29, 1988 / Rules and Regulations.
28885
information could support a valid claim
of trade- secrecy. A claim ia< sufficient if '
it meet* the criteria set fortlr in § 350.13.
(1) Sufficient claim: If the claim meets
the criteria of sufficiency set forth in
§ 350.13. EPAshalLnotify the'submitter
in writing; by certified mail (return
receipt requested),, that it has 30 days
from the date of receipt of the notice to
submit supplemental information in
writing in accordance with § 350.7(e), to
support the truth of the facts asserted in
the substantiation. EPA will not accept
any supplemental information, in
response to this notice, submitted after
the 30 day period has expired. The
notice required by this section shall
include the address to which
supplemental information must be sent
The notice may specifically request
supplemental information in particular
areas relating to the submitter's claim.
The notice must afeo inform the - -
submitter of his right to cfaim any trade
secret or confidestiaitra*uje«» -:':- •
infomatioB a» confidential,and shall
include a reference to §r35Qtfte) of this
regulation a» the source forthe proper
procedure for claiming trade secrecy for
trade secret or confidential business
information submitted itt the
supplemental information requested by
EPA.
(2) Insufficient claim. If the claim does
not meet the criteria of sufffcieccy set
forth hi } 350.13, EPA shafl notify the
subnriUei in writing of tbia fact by
certified mail (return receipt requested).
Upon receipt of this notice, the submitter
may either file an appeal of the matter
to the General Counsel under paragraph
(a)(2Ki) of this section, or, for good:
cause shown, submit-additional material
in support of its claim of trade secrecy
to EPA under paragraph (a)f2Mii) of this
section. The notice required by this
section shall include the reasons for
EPA'* decision that the submitter's
claim is insufficient, and shall inform the
submitter of its rights within- 30 days- of
receiving notice to file an appeal with
EPA's General Counsel or to amend its
original substantiation for good cause
shown. The notice shall include the
address of the General Counsel, and the
address of the office to which an
amendment for good-cause shown
should be sent The notice shall also
include a reference to § 350.11(a)(2)(i)-
(iv) of this subpart a* the source on the
proper procedures for filing an appeal or
for amending: the original substantiation.
(i) Appeal- The submitter may file an
appeal of a determination of " '
insufficiency with the General Counsel
within 30 days of receipt of the notice of
insufficiency, in accordance with the
procedure* set forth in-§35037. '
(ityGoodCause. In lieu of an appeal to
the General Counsel, the submitter may
send additional material in support of its
trade secrecy claim, for good cause
shown, within 30 days of receipt of the
notice of insufficiency. To do so, the
submitter shall notify EPA by letter of
its contentions as to good cause, and
shall include in that letter the additional
supporting material.
(iii) Good cause is limited to one or
more of the following reasons:
(A) The submitter was not aware of
the facts underlying the additional
information at the time the
substantiation was submitted, and could
not reasonably have known the facts at
that time; or
(B) EPA regulations and other EPA
guidance did not call for such
information at the time the
substantiation was submitted; or .
(C) The submitter had made a good
faith effort to snbmft a complete
substantiation; bat failed to do so duetc*
an inadvertent omfssron or clerical
error. . . '
(iv) If EPA determine* that the
submitter has met the standard for good-
cause, then EPA shall decide, pursuant
to paragraph- (a J of this section,, whether
the submitter's claim meets the Agency':*
standards of sufficiency set forth in
1350.13:
(A) If after receipt of additional
material for good cause, EPA decides
the claim is sufficient, EPA will
determine whether the claim presents a
valid claim of trade secrecy according to
the procedures set forth in paragraph (b)
of this section.
(B) If after receipt of additional
material for good cause; EPA decides
the claim is- insufficient. EPA will notify
the submitter by- certifiedrmail(return -
receipt requested) and the submitter
may seek review in U.S. District Court
within 30 days of receipt of the notice.
The notice required by this paragraph-
shall include EPA's reasons for its
determination, and shall inform the ,
submitter of its right to seek review in
U.S. District Court within 30 days of
receipt of the notice. The petitioner shall
be notified of EPA's decision by regular
mail.
(y) If EPA determines that the
submitter has not met the standard for
good cause, then EPA shall notify the
submitter by certified mail (return
receipt requested). The submitter may
seek review of EPA's decision in U.S.
District Court within 30 days of receipt
of the notice. The notice required in this '
•paragraph shall include EPA's reasons
for its determination, and shalltriform, '
the submitter of its right to seek review
in U.S. District Court within 30 days of
receipt of the notice. The petitioner shall
be notified of EPA's decision by regular
mail. . " . ' .
(b) Determination of trade secrecy.
Once a claim has been determined to be
sufficient under paragraph (a) of this, .
section, EPA must decide whether the
claim is entitled to trade secrecy.
(1) If EPA determines that the
information submitted in support of the
trade secrecy claim is true and that the
chemical identity is a trade secret, the
petitioner shall be notified by certified.
mail (return receipt requested) of EPA's
determination and may bring an action
in U.S. District Court within 30 days of
receipt of such notice. The notice
required in this paragraph shall include
the reasons why EPA has determined
that the chemical identity is a trade
secret- and shall- inform the petitioner, of
its right to seek review in. U.S. District
Court within 30 days of receipt of -the
notice. The submitter shall be notified of
EPA's decision by regular mail.
(2) If EPA decides that the information
submitted in- support of the trade
secrecy claim is not true and that the'
chemical identity is not a trade secret
(i) The submitter shall be notified by
certified mail (return receipt requested)
of EPA's: determination and may appeal
to the General Counsel within 30 days of
receipt of such notice, in accordance
with- the procedures set forth in § 350.17.
The notice required by this paragraph
shall include the reasons why EPA has
determined that the chemical identity is
not A trade secret and shall inform the
submitter of its appeal rights to EPA's
General Counsel. The notice shall
include the address to which an appeal
should be sent and the procedure for
filing an appeal, as set forth in
§ 350.17(a) of this subpart. The
petitioner shall be notified of EPA's
decision by regular mail
(ii) The General Counsel shall notify
the submitter by certified mail (return
receipt requested) of its decision on
appeal pursuant to the requirements in
§ 350.17. The notice required by this
paragraph shall include the reasons for
EPA's determination. If the General
Counsel affirms the decision that the
chemical identity is not a trade secret,
then the submitter shall have 30 days
from the date it receives notice of the
General Counsel's decision to bring an
action in U.S. District Court. If the
General Counsel decides that the .
chemical identity is a trade secret, then
EPA shall follow the procedure set forth
in paragraph (bKl) of thia section. '
§350.13 Sufflctency of assertions. ;)
(a) A substantiation submitted.under "
§ 350.7 Will be determined to be ''"""
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28806.
Federal
Val 53, No, 14g /ri
§ 350.7, or 5 350.11(a)[2)(ii). |
§ 350.15 Public petitions requesting >
disclosure of chemical identity claimed as,
trade secret ;
(a) The public may request the i
disclosure of chemical identity claimed
as trade secret by submitting a written i
petition to the address specified in :.
§ 350.16. , !
(b) The petition shall include: ;
"(1) The name, address, and telephone
number of the petitioner; >
(2) The name and address- of the i
company-claiming the chemical identity
as trade secret; and
(3) A copy of the submission in which
the submitter claimed chemical identity
as trade secret, with a specific ;
indication as to which chemical identity
the petitioner seeks disclosed. '
(c) EPA shall acknowledge, by letter j
to the petitioner, the receipt of the
petition; , !
(d) Incomplete petitions. If the
information contained in the petition is
not sufficient to allow EPA to identify i
which chemical identity the petitioner is
seeking to have released, EPA shall \
notify the petitioner that the petition
cannot be further processed until
additional information is furnished. EPA
will make every reasonable effort to
assist a petitioner in providing sufficient
information for EPA to identify the ;
chemical identity the petitioner is :
seeking to have released..
(e) EPA shall make a determination on
a petition requesting disclosure-, in
accordance with § 350.11 and § 350.17,
within nine months of receipt of such
petition. .
§550.16 Address to send trade secrecy
cteints and-petitions requesting disclosure^
All claims of trade secrecy under
sections 303 (d)(2), (d)(3), 311, 312, and
313 and ail public petitions requesting
disclosure of chemical identities claimed
as trade secret should be sent to the
following address: U.S. Environmental
Protection Agency, Emergency Planning
and Community Right-to-Know Program.
P.O. Box 70266. Washington. DC 20024-
0266.
§350.17 Appeals.
(a) Procedure for filing appeal. A
submitter may appeal an EPA
determination under §§ 350.11 (a)(2)(i)
or (b)(2)(i). by filing an appeal with the
General Counsel. The appeal shall be
addressed to: The Office of General
Counsel, U.S. Environmental Protection
Agency, Contracts and Information Law
Branch, Room 3600M, LE-132G, 401 M
Street, SW., Washington, DC 20460.
The appeal shall contain the following:
(1) A letter requesting review of the
appealed decision; and
(2) A copy of the letter containing
EPA's decision upon which appeal is
requested.
(b) Appeal of determination of
insufficient claim.
(1) Where a submitter appeals a
determination by EPA under
§ 350.11(a)(2}(i) that the trade secrecy
. claim presents insufficient support for a
finding of trade secrecy, the General
Counsel shall make one of the following
determinations:
(i) The trade secrecy claim at issue
meets the standards of sufficiency set
forth in § 350.13; or
(ii) The trade secrecy claim at issue
does not meet the standards of
sufficiency set forth in § 350.13.
(2) If the General Counsel reverses the
decision made by the EPA office
handling the claim, the claim shall be
processed-according to § 350.11(a)(l).
The General Counsel shall notify the
submitter of the determination on
appeal in writing, by certified mail
(return receipt requested). The appeal
determination shall include the date the
appeal was received by the General
Counsel, a statement of the decision
appealed from, a statement of the
decision on appeal and the reasons for
such decision.
(3) If the General Counsel upholds the
•determination of insufficiency made by
the EPA office handling the claim, the
submitter may seek review in U.S.
District Court within 30 days after
receipt of notice of the General
Counsel's determination. The General
Counsel shall notify the submitter of its
determination on appeal in writing, by
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Federal Register .j • VoL
certified mail (return
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and Regolgtions_
United State* for purposes of this
135O23. Subject to the limitations in .
this § 350.23(0). information to-which
this section, applies.may be disclosed to
such a person if the EPA program office
managing the contract, subcontract, or
grant first determines in writing that
such disclosure is necessary in order
that the contractor, subcontractor or
grantee may carry out the work required
by the contract, subcontract or grant.
(2) No information shall be disclosed
under this § 35O23(b) unless this-
contract subcontract, or grant in
question provides:
(i) That the-contractor, subcontractor
or the grantee and'the-contractor's;
subcontractor's, or grantee's employees
shall use the information only for the
purpose of carrying out the work-
required by the contract; subcontract; or
grant, and shall refrain-from" disclosing
the information to anyone other than
EPA without the priorwritteaapprowal -
of each affected submitteroT of an-EPA
legal officer and shall return-to EPA all
copies of the information (and any
abstracts or extracts therefrom) upon
request by the EPA program office.
whenever the information is-no longer
required by the contractor,
subcontractor or grantee for the
performance of the work required under
the contract-subcontract or grant, or -.
upon completion-of the contract, ;
subcontractor grant; ;
(ii) That the contractor, subcontractor
or grantee shall obtain a. written
agreement to honor such terms of the :
contract or subcontract from each of the
contractor's, subcontractor's or grantee's
employees who will have access to the ;
information,, before such employee is \
allowed such access; and
(Hi) That the contractor, subcontractor
or grantee acknowledges and agrees
that the contract, subcontract or grant !
provisions concerning the use and
disclosure of confidential business :
information are-included for the benefit
of. and shall be enforceable by, both ;.
EPA and any covered facility having an
interest in information concerning it •
supplied to the contractor, subcontractor
or grantee by EPA under the contract or
subcontract or grant ' i
• (3) No-information shall be disdosed
• under this § 35O.23(b) until each affected
submitter has been furnished notice of •
the contemplated disclosure by the EPA
program office and has been afforded a
period found reasonable by that office'
(not less than-5 working days> to submit
its comments. Such notice shall include
a description of the information to be
disclosed, the identity of the contractor,
subcontractor or grantee, the contract;
subcontract or grant number, if any,-and
the purposes to be served by the
disclosure. This notice may be published
in, the Federal Register or may be sent to
individual submitters.
(4) The EPA program office shall
prepare a record of disclosures under
this § 350.23(b). The EPA program office
shall maintain the record of disclosure
and the determination of necessity
prepared under paragraph (b)(l) of this
section for a period of not less than 36
months after the date of the disclosure.
§350.25 Disclosure In special
circumstances.
Other disclosure of specific chemical
identity may be made in accordance
with 40 CFR 2.209.
.§35027 Substantiation focm to
accompany claims of trad* secrecy.
Instructions to substantiation form.
(a) The form in paragraph (b) of this
section must be completed and
submitted as required in § 350.7(a).
(b) Substantiation form to accompany
claims of trade secrecy.
9JUMKJ CODE SS80-50-*
-------
vvEPA
United States Environmental Protection Agency • • •
Washington, DC20460 •• :. :
Substantiation To Accompany Claims of Trade Secrecy
Under the Emergency Planning and
Community Right-To-Know Act of 1936
Form Approved.
OMB No. 2050-0078
Approval expires 10-31-90
Paperwork Reduction Act Notice
Public reporting burden for this collection of information is estimated to vary from 27.7 hours to 33 2 hours per
response, with an average of 28.8 hours per response, including time for reviewing Instructions, searching existinq
9fnerin9 a"d maintaining the-data needed, and completing and reviewing the collection of
a^sstsa0?^^ aassa
p
Part 1. Substantiation Category
1.1 Tttte III Reporting Section (check only one*
303
3if
312
313
1.2 Reporting Year -j g
Thia Form t» (check only one)
i.3a.
Sanitized
(answer 1 .3. 1 a below)
V.3.1a. Generic Class or Category
1.3b.
Unsanitized
' (answer i.3.1b. and l.3.2b. below)
1,3,10. CAS Number
U.2b. Specific Chemical Identity
1 Identification Information
Page 1 of S
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28S10
VoL 53. No. 14Q/ Friday. July 29. 198ft /Rules and Regulations
Part 3. Responses to Substantiation Questions
3.1 Describe the specific measures you have taken to
chemical identity claimed as trade secret, and indicate
continue in the future;
safeguard
the confidentiality of the
whether these measures will
3.2 Have you disclosed the information claimed as trade secret to any other person (other than
a member of a local emergency planning committee, officer or employee of the United
States or a Stata or locaT government,-or your employee) who is not bound by a
confidentiality-agreement to refrain from disclosing this trade secret information to others?
Yes
3.3 List all local, State, and Federal government entities to which you have disclosed the
specific chemical identity. For each, indicate whether you asserted a confidentiality claim for
the chemical identity and whether the government entity denied that daim.
•Government Entity-
ConMtntUtty
Claim Assarted
Ye*
No
Confidentiality
Claim Denied
Yea
No
EPA Form 951M (7-S8)
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Foder^ Regktet
Frifoy. Jiifr 29, 33B8 f jRuIe^and Regofatfon*
28811
3.4 In order to show the validity of a trade secrecy dainV you must identify your specific use-of
the chemical claimed as trade secret and explain why it is a secret of interest to
competitors. Therefore: : . •.
(i) Describe the spedfic use of tha chemical daimed as trade secret, identifying the product or
process in which it is used. (If you use the chemical other than as a component of a
product or in a manufacturing, process, identify the activity where the chemical is used.)
(11) Mas your company or facility-identity, beerrlinked to the specific chemical identity claimed as
trade secret in. a-patent, OP irt-pubUcatioRs. or other informatiort sources-available to the
public OF your competitors (of which you are aware)?
Yea
If so, explaii^v^thfeknG4n^ge»doesiwteHmir^at& for trade secrecy.
(HI)- lt..this use of the chemical daimed-as: trade secret is unknown outside your company
explain how, your competitors could deduce this use from disclosure of the chemical
identity together with other information orr.the TitleIllsubmittal form
EPA
(7-88}
Pag* &ot 5
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20312
Federal Register;./ Vol. 53,. No. 146 / Friday, July 29,1988 / Rules and Regulations
3.4 (tvV Explain why your use of the chemical claimed as trade secret would be valuable
information to your competitors. • -'
3 5 Indicate the nature of- the harm to your competitive position that would likely result from
disclosure of the specific chemical identity, and indicate why such harm would be
'substantial. : . . •"' •. ' •• " .
3.6 (!) To what, extent is the chemical claimed as trade secret available to the public or your
competitors in products, articles, or environmental releases? '
EPA Fowl W1
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EtrfaeKfeR^Ster / Vok ,S& Ntte 14&/ Friday, Jnly j». 1988 / Rules aad Regulation*
28823
3.6 (if) Describe the factors which influence the-cost-of determining the. iderrtity of the chemical
daimed as trade secret by chemtcaf analysis of the product, article, or waste which
contains me chemical (e.g;i whether the chemical is in pure form or is mixed with other
substances). . .-
Part 4. Certification (Read and sigrv after completing ail sections)
ro*^i»«5~^,^-^r" £ '*" •,••«»*» H*? *>««.•«»»/ SWWMIHHCU the information submitted in-this
thPr;«iS5£™^j^ra!!-*8386?.0" roy W«y of those individuals responsible for obtaining
tho^Dortiars' fttS^ the submitted information- is true, accurate, and complete, and that
chemica*identrty°beingSaSas^^^e^o^S^eSo'ther --* —**• l*Y8ar me
trade secret information. Vacknowledae that' ' "^ °^*v«"er
ArtOn/^\/- in r\rr~i\tir4A {*»*+}+*+» mi-.*.-.'!^L~* £—~.S. • -_ i
I may be asked by the
substanLtion reSn^to fh
6 ^ belief that such information
that
misleading statement may be punishable by fine or
lagement official.
riginal)
4.3 Data Signed
MUJMQCOKl
Pag* 5o(5
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Instruction! for Completing tfaa EPA-
Trado Secret Substantiation1 Form ' •
General Information
EPA requires that the information
requested in a trade secret
substantiation be completed using this
substantiation form in order to ensure
that all facility and chemical identifier
information, substantiation questions,
and certification statements are
completed. Submitter-devised forms will
not be accepted. Incomplete
substantiations will in all likelihood be
found insufficient to support the claim,
and the claim will be denied. Moreover,
the statute provides that a submitter
who fails to provide information
required will be subject to a $10.000 fine.
For the submitter's own protection,
therefore, the EPA form must be used
and completed in its entirety. •
The statute for section 322 establishes
a two-phase process in which the
submitter must dwthe following:
1. At the time a report is submitted,
the submitter must present a complete '
set of assertions that (if true) would be
sufficient to justify the claim of trade •
secrecy; and
2. If the claim is reviewed by EPA, the
submitter will be asked to provide
additional factual information sufficient
to establish the truthfulness of the
assertions made at the time the claim
was made.
In making its assertions of trade
secrecy, a submitter should provide,
where applicable, descriptive factual •
statements. Conclusory statements of
compliance (such as positive or negative
restatements of the questions) may not
provide EPA with enough information to
make a determination and may be found
insufficient to support a claim.
What May Be Withheld
Only the specific chemical identity
required to-be disclosed in sections 303,
311,312, and 313 submissions may be
claimed trade secret on the Title in
submittal itself. (Other trade secret or
confidential business information
included in answer ta a question on the
substantiation may be claimed trade
secret or confidential, as described
below.)
Location information .claimed as .
confidential under section 312(d)(2)(F)
should not be sent to EPA; this should
only be sent to the SERC, LEPC, and the
fire department, as requested.
Sanitized and Unsanitized Copies •
You must submit this form to. EPA in
sanitized and unsanitized versions,
alqng with the sanitized and unsanitized
copies of the submittal.that gives rise to
this trade secrecy claim (except for the
section 303 submittal, and for MSDSs
under section1311). The unsanitized
version of this form contains specific
chemical identity and CAS number* and
may contain other trade secret or
confidential business information, which
should be clearly labeled, as such.
Failure to claim other information trade
secret or confidential will make that
information publicly available. In the
sanitized version of this form, the
specific chemical identity and CAS
number must be replaced with the
chemical's generic class or category and
any other trade secret or confidential
business information should be deleted.
You should also send sanitized copies of
the submittal and this form to relevant
State and local authorities.
Each question on this form must be
answered: Submitters are encouraged to
answer in the space provided.. If you
need more space to answer a particular.
question; please use additional sheets. If
you use additional sheets, be sure to
include the number (and if applicable,
the subpart) of the question being
answered and write your facility's Dun
and Bradstreet Number on the lower
right-hand corner of each sheet
When the Forms Must be Submitted
The sanitized and unsanitized report
forma and trade secret substantiations
must be submitted to EPA by the normal
reporting deadline for that section (e.g.,
section 313 submissions for any
calendar year must be submitted on or
before July 1 of the following year).
Where to Send the Trade Secrecy Claim
All trade secrecy claims should be
sent to the following address: U.S.
Environmental Protection Agency,
Emergency Planning and Community
Right-to-Know Program, P.O. Box 70266,
Washington, DC 20024-0266.
In addition, you must send sanitized
copies of the report form and
substantiation to relevant State and
local authorities. States will provide
addresses where the copies of the
reports are to be sent.
Packaging of Claim(s)
A completed section 322 claim
package must include four items,
packaged in the following order:
1. An unsanitized trade secret
substantiation form.
2. A sanitized trade secret .
substantiation form.
3. An unsanitized 312 .or 313: report (it
is not necessary to create an unsanitized
• section 303 submittal or MSDS for
submission under section-311);
4. A sanitized (public) section 303,311,
312, or 313 or report
sit is important to securely fasten
together (binder clip or rubber band!
each of the reporting forms and
substantiations for the particular
chemical being claimed trade secret.
This process will make it clear that a
claim is physically complete when
submitted. When submitters submit
claims for more than one chemical, EPA
requests that the four parts associated
with each chemical be assembled as a
set and each set for different chemicals
be kept separate within the package
sent to EPA. Following these guidelines
permits the Agency to make the
appropriate determinations of trade
secrecy, and to make public only those
portions of each submittal required to be
disclosed.
How to Obtain Forms and Other
Information
; Additional copies of the Trade Secret
Substantiation Form may be obtained -
by writing to: Emergency Planning and
Community Right-to-Know Program,
U.S. Environmental Protection Agency.
WH-562A, 401M Street, SW.,
Washington, DC 20460.
Instructions for Completing Specific
Sections of the Form
Part 1. Substantiation Category
-' 1.1 Title III Reporting Section. Check
ithe box corresponding to the section for
which this particular claim of trade
secrecy is being made. Checking off
more than one box for a claim is not
permitted.
! 1.2 Reporting Year. Enter the year to
'which the reported information applies.
inot the year in which you are submitting
'the report.
; 1.3a Sanitized. If this copy of the
'submission is the "public" or sanitized
version, check this box and complete
il.3.1a. which asks for generic class or
category. Do not complete the
I information required in the unsanitized
box(1.3b.).
i l.3,la Generic Class or Category. You
i must complete this if you are claiming
the specific chemical identity as a trade
! secret and have marked the box in 1.3a.
• The generic chemical name must be
'structurally descriptive of the chemical.
; J.3b Unsanitized. Check the box if this
version of the form contains the specific
chemical identity or any other trade
; secret or confidential business
, information,
. 1.3.1b CAS Number. You must enter
\ the Chemical Abstract Service (CAS)
: registry number that appears in the
•f appropriate section of the rule for the
chemical being reported. Use leading
1 place holding zeros. If you are reporting
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Vol 5a> ^ 14&>?
29;198ff^ Rules a'nd; Regulations
28815
a chemical category (e.g., copper ' - ,
compounds], enter N/A in the CAS
number space; .....
1.3.2h Specific- Chemical Identity.
Enter the name of the chemical or
chemical category as it.is listed in the
appropriate section of the reporting rule.
Part 2. Facility Identification
Information .
2.1-2.3Facility Name and Location.
You must enter the name of your facility
(plant site name or appropriate facility
designation), street address, city,' State
and ZIP Code in the space provided.
You may not use a post office box
. number for this location.
2:4 Dun and Bradstreet Number. You
must enter the number assigned by Dun
and Bradstreet for your facility or each
establishment wthin your facility. If the
establishment does not have a D & B
number, enter N/A in the boxes
reserved for those numbers. Use leading
place holding zeros.
Part 3. Responses to Substantiation
Questions
The six questions posed in this form
are based on the four statutory criteria
found hi section 322(b) of Title ffl. The
information you submit in response to
these questions is the basis for EPA's
initial determination as to whether the
substantiation is sufficient to support a '
: claim of trade secrecy. EPA has
indicated.in £350.13 of the final rule the.
.specific criteria that it-regards as the •.
legal basis for evaluating whether the
answers you. have provided are
sufficient to warrant protection of the
chemical identity. You are urged to
review those criteria before preparing
answers to the questions on the form.
Part 4. Certification
An original signature is required for
each trade secret substantiation
submitted to EPA, both sanitized and
unsanitized. It indicates the submitter is
certifying that the particular
substantiation provided to EPA is
complete, true, and accurate, and that it
is intended to support the specific trade
secret claim being made.-.
Noncompliance with thia certification
requirement may jeopardize the trade
secret claim. ... .
4.1 Name and Official Title. Print or
type the name and title of the person
.who signs the statement at 4.2.
4.2 Signature. This certification must
. be signed by the owner or operator, or a
senior official with management .
responsibility for the person-(or persons)
completing the form. An original
signature is required for each trade .
secret substantiation submitted to EPA,
both sanitized and unsanitized. Since
the certification applies to all :
information supplied on the forms, it
should be signed only after the
substantiation has been completed.
4.3 Date. Enter the date wheri'the
certification was signed.
Appendix A—Restatement of Torts
Section 757, Comment b
b. Definition of trade secret A trade secret
may consist of any formula; pattern, device or
compilation of information which is used in
one's business, and which gives him an
opportunity to obtain an advantage over
competitors who do not .know or use it It
may be a formula for a chemical compound, a
process of manufacturing; treating or
preserving materials, a pattern for a machine
or other device, or a list of customers. It
differs from other secret information in a
business {see section 759) in that it is not
simply information as to single or ephemeral
events in the conduct of the business, as, for
example, the amount or other terms of a
secret bid for a contract or the salary of
certain employees, or the security
investments made or contemplated, or the
date-fixed for the announcement of a new-
policy or for bringing out a new model or the
like. A trade secret is a process or device for
continuous use in the operation of the
business. Generally it relates to the
production of goods, as, for example, a
machine or formula for the production of an
article. It may, however, relate to the sale of
goods or. to other operations in the business.
such-as a code for determining discounts,
rebates or other concessions in a price list or
catalogue, or a-list of specialized customers.
or a method of bookkeeping or other office
management " '..
Secrecy. The subject matter of a trade
secret must be secret Matters of public
knowledge or of general knowledge in an
industry cannot be appropriated by one as
his secret Matters which are' completely
disclosed by the goods which one markets
cannot be his secret Substantially, a trade
secret is known only in the particular
business in which it is used. It is not requisite
that only the proprietor of the business know
it. He may, without losing his protection,
communicate it to employees involved in its
use. He may likewise communicate it to
others pledged to secrecy. Others may also
know of it independently, as, for example,
when they have discovered the process or
formula by independent invention and are
keeping it secret Nevertheless, a substantial
element of secrecy must exist, so that, except
by the use of improper means, there would be
difficulty in acquiring the information. An
exact definition of a trade secret is-not
possible. Some factors to be considered in
determining whether given information is
one's trade secret are: (1) The extent to which
the information is known outside of his
business; (2) the extent to which it is known
by employees and others involved in his
business; (3) the extent of measures taken by
him to guard the secrecy of the information;
(4) the value of the information to him and to
his competitors; (5) the amount of effort or •
money expended by him in developing the-
information; (6) the ease or difficulty with .
which the information could be properly
acquired or duplicated by others.
Novelty and prior art. A trade secret may. .
be a device or process which is patentable;
but it need not be that. It may be a device or
process which is clearly anticipated in the
prior art or one which is merely a mechanical
improvement that a good mechanic can make.
Novelty and invention are not requisite for a
trade secret as they are for patentability.
These requirements are essential to
patentability because a patent protects
against unlicensed use of the patented device
or process even by one who discovers it
. properly through independent research. The
patent monopoly is a reward to the inventor.
But such is not the case with a trade secret.
Its protection is not based on a policy of
rewarding or otherwise encouraging the
development of secret processes or devices.
The protection is merely against breach of
faith and reprehensible means of learning
another's secret. For this limited protection it
is not appropriate to require also the kind of
novelty and invention which is a requisite of
patentability. The nature of the secret is,
however, an important factor in determining
the kind of relief that is appropriate against
one who is subject to liability under the rule
stated in this section. Thus, if the secret
consists of a-device or process which is a
novel invention, one who acquires the secret
wrongfully is ordinarily enjoined from further
• use of it and is required to account for the
profits derived from his past use. If. on the
other hand, the secret consists of mechanical
improvements that a good mechanic can
make without resort to the secret the
wrongdoer's liability may be limited to
x damages., and an injunction against future use
of the improvements made with the aid of the
secret may be inappropriate.
Subpart B—Disclosure of Trade Secret
Information to Health Professionals
§350.40 Disclosure to health
professionals.
(a) Definitions. "Medical emergency"
means any unforeseen condition which
a health professional would judge to
require urgent and unscheduled medical
attention. Such a condition is one which
results in sudden and/or serious
symptom(s) constituting a threat to a
person's physical or psychological well-
being and which requires immediate
medical attention to prevent possible
deterioration, disability, or death.
(b) The specific chemical identity,
including the chemical name of a
hazardous chemical, extremely
hazardous substance, or a toxic
chemical, is made available to health
professionals, in accordance with the
applicable provisions of this section.
(c) Diagnosis or Treatment by Health
Professionals in Non-Emergency
Situations. (1) An owner or operator of a
facility which is subject to the
requirements of sections 311. 312. and
313. shall upon request, provide the
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Fedsial Register / Vol., 53, No. 148 / Friday. July 29,1988: / Rules and
specific chemical identity, if known, of a
hazardous chemical, extremely
hazardous substance, or a toxic
chemical to a health professional if:
(!) The request is hi writing:
(51} The request describes why the
health professional has a reasonable
basis to suspect that:
(A) The specific chemical identity is
needed for purposes of diagnosis or
treatment of an individual,
(B) The individual or individuals being
diagnosed or treated have been exposed
to the chemical concerned, and
(C) Knowledge of the: specific
chemical identity of such chemical will
assist in diagnosis or treatment
(Hi) The request contains a
confidentiality agreement which
includes:
(A) A description of the procedures to
be used to maintain the confidentiality .
of Ihe disclosed information; and
(B) A statement by the health
professfaBal that he will not use the
informs tioa fot any purpose othet than*
the health* need* asserted in the
statement of need authorized in
paragraph (cHlftH} oi this section and
will not release the information under
any circumstances, except as authorized
by the term* of the confidentiality
agreement or by the owner or operator
of the facility providing such
information.
(iv) The request inckde* a
ceitificatioa signed by the health
professional stating that the information-
contained in the statement-of need is
true.
(2) Follow&ig receipt of a written
request, the facility owner or operator to
whom such request is made shall
provide the requested information to the
health professional promptly.
(d} PreventfffBMeasures and .
Treatment by Local Health
Professionals: (1) An owner or operator
of a facility subject tcr the requirementa
of sections 311, 312; and 313. shall
provide the specific chemical identity, if
known, of a hazardous chemical, an
extremely hazardous substance, or a
toxic chemical to any health
professional (such as a physician,
lexicologist, epidemiologist or nurse) i£
(i) The requester is a local government
employee or a person under cTntract
with the local government:
(H) The request is in writing:
(Hi) The request describes with
reasonable detail one or more of the
following health needs for 1he
information;.
(A) To assess exposure of persons ;
living in a local community to the '
hazards of the chemical concerned.
(B) To conduct or assess sampling to ,
determine exposure levels of various
population groups. j
(C) To conduct periodic medical
surveillance of exposed population j
groups. '
(D J To provide medical treatment to
exposed individuals or population '
groups. i
(E) To conduct studies to determine
the health effects of exposure.
(F) To conduct studies to aid in the ,
identification of chemicals that may <
reasonably be anticipated to cause an ;
observed health effect !
(iv) The request contain* a \
confidentiality agreement which
includes: •
(A) A description of the procedures to
he-used to maintain the confidentiality '
of the disclosed information: and i
[B] A statement by the health. ,
professional that he will not use the
information for any purpose other than
the health needs asserted in the
statement of need authorized in ;
paragraph (d)(l)(uij of this section and
will not release the information under
any circumstances .except as may ;
otherwise be authorized by the terms of
such agreement or by the owner or j
operator of the facility person providing
such information, i
(v) The request includes a certification
signed by the health professional stating.
that the information contained in the
statement of need is-true. ;
(2) Following, receipt of a written I
request the facility owner or operator to
whom such request is made shall ;
promptly provide the requested ,
information to the local health j
professional. ,
(B) Medical Emergency. (1) An owner
or operator of a facility which is subject
to the requirements of sections 311,312.
and 313, must provide a copy of a
material safety data shreet an inventory
form, or a toxic chemical release form,
' including the specific chemical identity if
known, of a hazardous chemical,
extremely hazardous substance-, or a
toxic chemical, to any treating physician
or nurse who requests such information
if the treating physician or nurse
determines that:
(i) A medical emergency exists as to
the individual or individuals being
diagnosed or treated;
(ii) The specific chemical identity of
the chemical concerned is necessary for
or will assist in emergency or first-aid
diagnosis or treatment; and,
(iii) The individual or individuals
being diagnosed or treated have been
exposed to the chemical concerned.
(2\ Owners or operators of facilities
must provide the specific chemical
identity to the requesting treating
physician or nurse immediately
following the request without requiring
a written statement of need or a;
confidentiality agreement in advance;
(3) The owner or operator may require
a written statement of need and a
written confidentiality agreement as
soon as circumstances permit The
written statement of need shall describe
hi reasonable detail the factors set forth
in paragraph (e)(l) of this section. The
written confidentiality agreement shall
be'in accordance with paragraphs ;
(c)(l)(iii) and (f) of this section.
(f): Confidentiality Agreement. The
confidentiality agreement authorized in
paragraphs (c)(l)(iii), (d)(l)(iv) and (e)(3)
of .this section:
(i) May restrict the use of the ,
information to the health purposes
indicated in the written statement of
need;
6i) May provide for appropriate legal
remedies in the event of a breach of the
agreement; and
(iii) May not include requirements for
the posting of a penalty bond.
(g) Nothing in this regulation is meant
to preclude the parties from pursuing
any non-contractual remedies to the
extent permitted by law, or from
pursuing the enforcement remedy
provided in section 32S(e) of Title III.
(h) The health professional receiving
the trade secret information may
disclose it to EPA only under the
following circumstances: The health
professional must believe that such
disclosure is necessary in order to learn
from the Agency additional information
about the chemical necessary to assist
him in carrying out the responsibilities
set forth in paragraphs (c}, (d), and (e) of
this section. Such information comprises
facts regarding adverse health and
environmental effects.
[FR Doc. 88-17029 Filed 7-26-88; 10:28 am]
BitUNO CODE 8500-SO-M
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