November 14, 2017

Ms. Julie Calendino Workplace Hazardous Materials Bureau Consumer Product Safety Directorate Department of Health Address Locator 4908B 269 Laurier Avenue West, 8th Floor Ottawa, Ontario K1A 0K9 julie.calendino@hc-sc.gc.ca whmis_ simdut@hc-sc.gc.ca

Re: Regulatory Impact Analysis Statement, Canada Gazette, Part I, Vol. 151, No. 42 – October 21, 2017 – Use of Concentration Ranges to Comply with WHMIS 2015

Dear Ms. Calendino:

The Independent Lubricant Manufacturers Association (“ILMA” or “Association”) submits these comments on Health Canada’s implementation of the Globally Harmonized System of Classification and Labelling of Chemicals (“GHS”) under the revised Hazardous Products Act (“HPA”) and implementing regulations. While the aim of GHS is to provide a uniform, worldwide hazard classification and communication regime, it has not yet occurred. ILMA members’ experiences are that each country’s implementation of GHS, while similar in many respects, presents unique requirements that a chemical manufacturer or importer must comply with in order to do business in that particular jurisdiction.

The above-referenced, proposed amendment to the Hazardous Products Regulations (“HPR”) is a sound approach to harmonization under GHS and should be adopted. It simultaneously protects the health and safety of workers and safeguards the Confidential Business Information (“CBI”) of chemical manufacturers, importers, and processors in a cost-effective manner.

Introduction to ILMA

ILMA is a North American trade association with 350 member companies that is headquartered in Alexandria, Virginia. A number of member companies are either headquartered or have operations in Canada, while others export products into the country. ILMA’s manufacturing members blend, compound, and sell over 25 percent of North America’s automotive lubricants (e.g., passenger car motor oils, gear oils, and hydraulic fluids) and more than 75 percent of the metalworking fluids (“MWFs”) consumed. The overwhelming majority of ILMA’s manufacturing members are small businesses by governmental standards.

Independent lubricant manufacturers are neither owned nor controlled by the companies that explore for or refine crude oil to produce lubricant base stocks or that make chemical additives. Base oils are purchased from refiners and re-refiners, who are also direct competitors in the sale of finished lubricant products.

Ms. Calendino Page 2 of 5 November 14, 2017 Lubricants are essential to the North American economy. Individuals cannot get to work without the engine oils, transmission fluids and other automotive lubricants in their vehicles. Manufacturers cannot operate most of their machinery without industrial oils and hydraulic fluids. MWFs are used to bend, shape or cut metal for the production or fabrication of automobiles, military equipment, airplanes, medical devices and thousands of other products. Issues with GHS Implementation ILMA members have spent considerable resources on their compliance activities under the U.S. Occupational Safety and Health Administration’s (“OSHA”) March 2012 amendments to its Hazard Communication Standard to incorporate GHS provisions (“HCS 2012”). OSHA, in the preamble to the HCS 2012 final rule, estimated that ILMA members would be responsible for authoring approximately 40 percent of the required, new Safety Data Sheets (“SDSs”). A typical ILMA member that makes MWFs has hundreds of formulations. For many of the Association’s member companies, their HCS 2012 compliance activities continued after OSHA’s deadlines because of the lack of upstream classification information to incorporate into their SDS and container labels. The membership is now in the process of creating new SDS and container labels to comply with Canada’s Workplace Hazardous Materials Information System 2015 (“WHMIS 2015”) by the May 31, 2018 deadline for manufacturers and importers. While Health Canada has not estimated the number of WHMIS 2015-compliant SDS that must be authored by ILMA members, the Association believes the number is substantial. There are several key differences between HCS 2012 and WHMIS 2015 that have generated compliance concerns for ILMA’s membership, particularly the WHMIS 2015 approach to CBI and trade secret protection, as it effectively mandates that chemical manufacturers disclose the exact concentration of each chemical component in a “mixture.” For ILMA member companies, what makes individual mixtures unique and work well in a specific, end-use application are variations in the lubricant formulations. As a result, these formulations, especially for MWFs, are closely-guarded trade secrets. Current Differences Between HCS 2012 & WHMIS 2015 Trade Secret Provisions HCS 2012 requires that manufacturers disclose exact concentration percentages for mixtures, but makes it relatively easy to claim trade secret protection. In many instances, manufacturers can provide a concentration range as opposed to the exact percentage of each individual component. HCS 2012 requires the following: For Mixtures In addition to the information required for substances: (a) The chemical name and concentration (exact percentage) or concentration ranges of all ingredients which are classified as health hazards in accordance with paragraph (d) of §1910.1200 and (1) are present above their cut-off/concentration limits; or (2) present a health risk below the cut-off/concentration limits. (b) The concentration (exact percentage) shall be specified unless a trade secret claim is made in accordance with paragraph (i) of §1910.1200, when there is batch-to-batch variability in the production of a mixture, or for a group of substantially similar mixtures (See A.0.5.1.2) with similar chemical composition. In these cases, concentration ranges may be used.

Ms. Calendino Page 3 of 5 November 14, 2017 For All Chemicals Where a Trade Secret is Claimed Where a trade secret is claimed in accordance with paragraph (i) of §1910.1200, a statement that the specific chemical identity and/or exact percentage (concentration) of composition has been withheld as a trade secret is required.

The specific trade secrets provision of HCS 2012 is set forth in 29 CFR § 1910.1200 (i):

1910.1200(i)(1) The chemical manufacturer, importer, or employer may withhold the specific chemical identity, including the chemical name, other specific identification of a hazardous chemical, or the exact percentage (concentration) of the substance in a mixture, from the safety data sheet, provided that:

1910.1200(i)(1)(i) The claim that the information withheld is a trade secret can be supported;

1910.1200(i)(1)(ii) Information contained in the safety data sheet concerning the properties and effects of the hazardous chemical is disclosed;

1910.1200(i)(1)(iii) The safety data sheet indicates that the specific chemical identity and/or percentage of composition is being withheld as a trade secret; and,

1910.1200(i)(1)(iv) The specific chemical identity and percentage is made available to health professionals, employees, and designated representatives in accordance with the applicable provisions of this paragraph (i).

Theabovedisclosurerequirements inHCS2012arestraight forwardandprovideacost-effectivemechanism to claim CBI, thereby allowing downstream blenders, such as ILMA members, to safeguard their proprietary formulation information while simultaneously providing adequate warnings to product end-users. While WHMIS 2015 provides for trade secrets exemptions under the Hazardous Materials Information Review Act (“HMIRA”), the current process and costs associated with CBI claims are considerably more onerous than under HCS 2012. Health Canada requires the following, as noted in its July 31, 2015 document, “Guidance – Disclosure of Ingredient Concentrations and Concentration Ranges on Safety Data Sheets” at § 3.3 Disclosing an Ingredient Concentration or Concentration Range:

Under both the HPR (WHMIS 2015) and HCS 2012:

• The true concentration of an ingredient must be disclosed when the ingredient is present in the mixture at a fixed concentration

• When an ingredient is not always present at the same concentration, then the true

concretion range of the ingredient in the mixture must be disclosed.

Ms. Calendino Page 4 of 5 November 14, 2017

When disclosing a true concentration range, the following conditions would apply (these do not apply to trade secrets as discussed below):

• The ingredient must be present in the mixture at a range of concentrations • The range must accurately reflect the concentration variation • The hazard classification must accurately reflect the hazard associated with the mixture

The process is costly, as a chemical manufacturer must pay $1,800 for each CBI claim and $1,440 for any re-filed claim.1 Additionally, any manufacturer who wishes to appeal a Health Canada decision regarding a trade secret claim must remit $2,000 with its statement of appeal. These fees are high for businesses and present a competitive barrier to participating in the Canadian marketplace. For example, ILMA conducted a survey in 2014,2 requesting input on the number of Material Safety Data Sheets (“MSDS”) that members were required to convert to HCS 2012-compliant SDS. Some 36 percent of respondents indicated that they were required to update greater than 500 MSDS, while only 10 percent reported that they had to revise fewer than 100 MSDS. Presuming the same range for products sold in Canada, and taking the low-end of the range at 150 SDS for which CBI claims must be made, the $1,800 perclaim fee generates a cost of $270,000. Such a cost, when multiplied across ILMA’s membership, is immense. This estimate does not include any costs associated for re-filed claims or appeals, which would increase the financial burden. ILMA members want to continue to be active market participants in Canada, but they must weigh this objective against protecting their company’s most valuable commodity – that is, their formulations -- as CBI, in a manner that it not cost prohibitive. Use Concentration Ranges is Appropriate and Provides the Same Warnings ILMA, therefore, is fully supportive of Health Canada’s effort under the HPR and the HMIRA regarding the ability of manufacturers and importers to use concentration ranges on their SDS without having to go through the time-consuming and costly process outlined above. As noted in the Regulatory Impact Analysis Statement, Canada Gazette Vol. 151, No. 42 – October 21, 2017, Health Canada is considering the following ranges:

o (a) from 0.1 to 1%; o (b) from 0.5 to 1.5%; o (c) from 1 to 5%; o (d) from 3 to 7%; o (e) from 5 to 10%; o (f) from 7 to 13%; o (g) from 10 to 30%; o (h) from 15 to 40%; o (i) from 30 to 60%; o (j) from 45 to 70%; o (k) from 60 to 80%; o (l) from 65 to 85%; and o (m) from 80 to 100%.

ILMA urges Health Canada to adopt the proposal for the protection of CBI (e.g., the exact percentages of components within a mixture) by allowing manufacturers and processors to disclose ingredients in ranges

1 The amounts are in Canadian Dollars. 2 The survey was responded to by 50 ILMA member companies and is representative.

Ms. Calendino Page 5 of 5 November 14, 2017 and still be fully compliant with the requirements of WHMIS 2015. Additionally, such an approach would be consistent with the objectives outlined by the U.S.-Canada Regulatory Cooperation Council (“RCC”). The RCC’s Work Plan for Work Place Chemicals notes, “The objective is to ensure that the requirements in Canada and the U.S. for hazard classification and communication can and will be met now and in the future, to the greatest extent possible, with one label and one safety data sheet that would be acceptable in both countries . . .” While Health Canada’s October 2017 proposal is not identical to OSHA’s current approach, it is significantly more harmonious than is allowed under the current WHMIS 2015 regulations. It would permit chemical manufacturers and importers in Canada and the United States to have one SDS, safeguarding trade secrets and ensuring that the health and safety of workers is fully protected. Conclusion ILMA respectfully requests that Health Canada adopt and implement its proposed utilization of concentration ranges by manufacturers and importers outlined in its October 21, 2017 proposal to comply with the regulatory mandates of WHMIS 2015. Sincerely,

Holly Alfano Chief Executive Officer cc: ILMA SHERA Committee ILMA MWF Committee ILMA Board of Directors Dr. John K. Howell Jeffrey L. Leiter, Esq. Daniel T. Bryant, Esq.