CPSC Vote on CPSIA Tracking Label Stay Ends in Tie, Requirement Expected to Take Effect Aug 14th

(In March 2009, the National Association of Manufacturers' CPSC Coalition asked the CPSC to stay enforcement of the CPSIA children's product tracking label provision for a full year, until August 14, 2010, in order to allow sufficient time to develop "clear and understandable" rules and provide CPSC, industry, and other stakeholders time to work together to develop an orderly approach to this new requirement. See ITT's Online Archives or 03/31/09 news, 09033110, for BP summary.)

Commission Tie Vote, No Decision Reached

According to the CPSC, Acting Chairman Nord voted to grant the request for an emergency stay for tracking labels, while Commissioner Moore voted to deny it. As a result, no decision on the stay was reached.

With No Decision, Tracking Label Requirement Due to Take Effect August 14th

As no decision has been reached, the CPSIA tracking label requirement for children's products is still due to take effect for products manufactured after August 14, 2009. Specifically, manufacturers will need to place permanent distinguishing marks on children's products and their packaging, to the extent practicable, that would enable the manufacturer and ultimate purchaser to ascertain: (i) the manufacturer or private labeler; (ii) location and date of production; (iii) cohort information (including batch, run number, or other identifying characteristic); (iv) etc.

CPSC Has Stated Labeling Requirement Would Apply to All Children's Products

CPSC has previously stated that the scope of this tracking label requirement is quite broad in that it applies to all children's products (for children 12 and younger) including, but not limited to, items such as clothing or shoes, not just toys and other regulated products. CPSC has also stated that this requirement is intended to assist in the event of a recall.

Nord's Vote: Recalls Would Not be Sufficiently Improved to Justify Impact

Acting Chairman Nord voted for the stay, noting that applying the tracking label provisions across the board to all companies will not necessarily improve recall effectiveness to such an extent as to justify the potential significant disruption and adverse impact on manufacturers, especially smaller companies. She adds that it has become clear to her that:

there is a great deal of confusion over the meaning of the statutory provisions;

there seems to be consensus that "one size does not fit all" with respect to tracking labels and that companies need to be able to develop labels that work for their individual products and situations, yet meet the needs of CPSC to increase recall effectiveness;

lead time is critical so that companies can absorb CPSC's guidance and make adjustments as appropriate; and

a period of time is needed to educate those impacted about the new requirements.

Nord adds that she would prefer more regulatory flexibility in order to first focus on high value products with long useful lives and a history of recall issues, and later use the lessons learned to determine how to apply the requirement to additional products.

Moore's Vote: No Authority to Postpone Statute, Don't Worry About Exact Format

Commissioner Moore voted against the stay arguing that while CPSC has stayed enforcement of a few sections of the CPSIA for certain products, it has not granted a blanket stay of enforcement from a provision for every affected product, as has been requested. Moore states that granting such a request would amount to a postponement of a statutory effective date, which is something the CPSC does not have authority to do.

Moore believes that the lack of detailed requirements in the CPSIA on the tracking label requirement and the fact that CPSC was not required to adopt regulations as an aid to compliance may have been acknowledgement of the fact that one size cannot fit all. He adds that as long as the tracking label information required by the law is ascertainable from the tracking label and companies are diligently trying to comply, there is no need for CPSC to dictate a particular format or for CPSC to punish an unwitting mistake.

(The Commission may take up the issue later, when there are more than two Commissioners. The Obama Administration has recently announced it is nominating two additional Commissioners, and then one more, which would result in the full "quorum" of five Commissioners. See ITT's Online Archives or 05/07/09 news, 09050715, for BP summary.)

¹Enacted as Public Law 110-314 on August 14, 2008.

²"Children's products" under the CPSIA are consumer products designed or intended primarily for children 12 years old or younger. In determining whether a consumer product is primarily intended for such children, the CPSIA outlines certain factors to be considered, including a statement by the manufacturer about the intended use of the product, etc.

(See ITT's Online Archives or 05/06/09 and 05/11/09 news, 09050605 and 09051110, for BP summary of CPSC announcing the tracking label stay vote being due May 8th and then delaying it until May 13, 2009, respectively.

See ITT's Online Archives or 05/05/09 news, 09050510, for BP summary of CPSC announcement of a May 12th forum on the CPSIA tracking label requirement.

See ITT's Online Archives or 04/21/09 news, 09042105, for BP summary of a letter sent by 28 members of Congress to CPSC stating that it should use its discretion in implementing the CPSIA, including working with businesses to establish the protections of the CPSIA without undue impact on the stream of commerce.

See ITT's Online Archives or 02/25/09 news, 09022505, for BP summary of a CPSCnotice requesting comments and information on implementation of this requirement.

See ITT's Online Archives or 09/15/08 news, 08091515, for BP summary of the CPSIA tracking label requirement.)

CPSC Record of Commission Action and accompanying Commissioner statements available at http://www.cpsc.gov/library/foia/ballot/ballot09/tracklabelstay.pdf