Elimination of Special Treatment for Category of Confidential Business Information

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 2

[FRL-6463-1]

Elimination of Special Treatment for Category of Confidential

Business Information

AGENCY: Environmental Protection Agency.

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) proposes to amend

its regulations to eliminate the special treatment given to a category

of confidential business information (CBI) received by EPA. This

category of information includes comments received from businesses to

substantiate their claims of confidentiality for previously submitted

information (``a substantiation''). Under EPA's existing regulations,

EPA automatically regards a substantiation as entitled to confidential

treatment if it is not otherwise possessed by EPA and is properly

marked as confidential when received by EPA. EPA proposes to eliminate

this provision because special treatment of substantiations is no

longer necessary to support the original purpose of the regulation, and

elimination of this provision will bring EPA into conformity with how

substantiations are treated by other federal agencies.

DATES: Comments on this proposed rule must be submitted by December 27,

1999. EPA does not intend to hold a public hearing on this proposed

rule, unless it receives a request for such a hearing. If a request is

submitted by November 24, 1999, EPA will hold a public hearing. If EPA

holds such a hearing, comments must be submitted within 30 days of the

date of the hearing.

ADDRESSES: Written comments on this proposed rule should be addressed

to Oscar Morales, Environmental Protection Agency, Office of

Environmental Information (2151), 401 M Street, SW., Washington, DC

20460. Documents related to this proposed rule will be available for

public inspection and viewing by appointment. If you wish to request a

public hearing on this proposed rule, please notify Mr. Morales at the

address shown above.

FOR FURTHER INFORMATION CONTACT: Oscar Morales, (202) 260-3759.

SUPPLEMENTARY INFORMATION:

I. Background

Currently, when EPA receives a Freedom of Information Act (FOIA)

request for information in EPA's control that was originally claimed as

confidential by the submitter of the information, EPA follows the

procedures in 40 CFR 2.204(e). EPA provides the submitter with notice

of the FOIA request and an opportunity to comment and provide a

substantiation. Once EPA receives the submitter's substantiation, it

evaluates the information and makes a determination as to the

confidentiality of the requested information. If EPA determines that

the

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requested information is not entitled to confidential treatment, EPA

notifies the submitter of its right to seek judicial review of EPA's

determination prior to the release of the information.

If the submitter claims the substantiation itself to be

confidential and marks it in accordance with the requirements of 40 CFR

2.203(b), and if EPA does not already possess the information in the

substantiation, under 40 CFR 2.205(c), the substantiation ``will be

regarded as entitled to confidential treatment and will not be

disclosed by EPA without the [submitter's] consent, unless its

disclosure is duly ordered by a Federal court, notwithstanding other

provisions of this subpart to the contrary.'' Thus, if EPA were to

receive a FOIA request for a substantiation that conforms to the above

requirements, EPA would automatically withhold the substantiation

without going through the CBI determination procedures of 40 CFR part

2, subpart B.

The original purpose of 40 CFR 2.205(c) was to encourage

businesses, which bear the burden of substantiating their claims of

confidentiality, to provide sufficient information to support their

claims by automatically regarding their substantiations as entitled to

confidential treatment if certain specified conditions were met.

II. Description of Proposed Rule

EPA proposes to amend its regulations to remove 40 CFR 2.205(c).

This amendment will eliminate EPA's separate treatment of

substantiations. Instead, EPA will treat substantiations in exactly the

same manner as all other information requested under FOIA and claimed

to be confidential.

EPA believes that there is no continued need for 40 CFR 2.205(c)

for two reasons. First, the special treatment of substantiations under

40 CFR 2.205(c) is no longer necessary to support the original purpose

of 40 CFR 2.205(c), which was to encourage businesses to provide

sufficient information to support their claims. EPA believes that its

CBI determination procedures of 40 CFR part 2, subpart B, provide

adequate safeguards and protections to prevent the improper release of

additional confidential business information contained in a submitter's

substantiation.

Second, EPA believes that removing 40 CFR 2.205(c) will bring EPA

into conformity with how substantiations are treated by other federal

agencies, which do not provide special treatment for substantiations.

III. Statutory Authority

EPA is proposing this rule under the authority of 5 U.S.C. 301, 552

(as amended), and 553.

IV. Economic Impact

This proposed rule is expected to have little or no economic impact

on parties affected by EPA's regulations at 40 CFR part 2, subpart B.

The removal of 40 CFR 2.205(c) will result in EPA's treatment of

substantiations in exactly the same manner as all other information

requested under FOIA and claimed to be confidential. Businesses will

continue to be required to comply with the marking requirements of 40

CFR 2.203(b) when submitting substantiations. Only after EPA receives a

FOIA request for a substantiation and notifies the submitter, pursuant

to 40 CFR 2.204(e), will the submitter have to provide comments to

substantiate its original substantiation.

V. Paperwork Reduction Act

The information collection requirements in this proposed rule have

not been submitted for approval to the Office of Management and Budget

(OMB) under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. An

amendment to the current Information Collection Request (ICR), (OMB

Control No. 2020-0003) will be prepared by EPA. Once it is prepared, it

will be announced in the Federal Register for public comment.

VI. Regulatory Flexibility Act

The Regulatory Flexibility Act, 5 U.S.C. 601 et seq., generally

requires an agency to conduct a regulatory flexibility analysis of any

rule subject to notice and comment rulemaking requirements unless the

agency certifies that the rule will not have a significant economic

impact on a substantial number of small entities. Small entities

include small businesses, small not-for-profit enterprises, and small

governmental jurisdictions. This proposed rule would not have a

significant economic impact on a substantial number of small entities

because it is not expected to result in any significant additional

costs to entities asserting a claim of confidentiality for their

information submitted to EPA. Any cost of providing comments on a

substantiation are likely to be incidental, and most often will simply

document a basis for confidentiality that has already been developed.

Therefore, under 5 U.S.C. 605(b), I certify that this rule will not

have a significant economic impact on a substantial number of small

entities.

VII. Environmental Impact

This proposed rule is expected to have no environmental impact. It

pertains solely to the collection and dissemination of information.

VIII. Executive Order 12866

Under Executive Order 12866 (58 FR 51735 (October 4, 1993)), EPA

must determine whether the regulatory action is ``significant'' and

therefore subject to OMB review and the requirements of the Executive

Order. The Executive Order defines ``significant regulatory action'' as

one that is likely to result in a rule that may:

(1) Have an annual effect on the economy of $100 million or more or

adversely affect in a material way the economy, a sector of the

economy, productivity, competition, jobs, the environment, public

health or safety, or State, local, or tribal governments or

communities;

(2) Create a serious inconsistency or otherwise interfere with an

action taken or planned by another agency;

(3) Materially alter the budgetary impact of entitlements, grants,

user fees, or loan programs or the rights and obligations of recipients

thereof; or

(4) Raise novel legal or policy issues arising out of legal

mandates, the President's priorities, or the principles set forth in

the Executive Order.

EPA has determined that this rule is not a ``significant regulatory

action'' under the terms of Executive Order 12866 and is therefore not

subject to interagency review under the Executive Order.

IX. Executive Orders 12875, 13132, and 12612 on Federalism

Under Executive Order 12875, EPA may not issue a regulation that is

not required by statute and that creates a mandate upon a State, local

or tribal government, unless the Federal government provides the funds

necessary to pay the direct compliance costs incurred by those

governments, or EPA consults with those governments. If EPA complies by

consulting, Executive Order 12875 requires EPA to provide to OMB a

description of the extent of EPA's prior consultation with

representatives of affected State, local and tribal governments, the

nature of their concerns, any written communications from the

governments, and a statement supporting the need to issue the

regulation. In addition, Executive Order 12875 requires EPA to develop

an effective process permitting elected officials and other

representatives of State, local and tribal governments ``to provide

meaningful

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and timely input in the development of regulatory proposals containing

significant unfunded mandates.'' This proposed rule does not create a

mandate on State, local or tribal governments. The rule does not impose

any enforceable duties on these entities. This rule applies to

businesses, not government entities, submitting comments to

substantiate CBI. Accordingly, the requirements of section 1(a) of

Executive Order 12875 do not apply to this rule.

On August 4, 1999, President Clinton issued a new executive order

on federalism, Executive Order 13132 [64 FR 43255 (August 10, 1999)],

which will take effect on November 2, 1999. In the interim, the current

executive order on federalism, Executive Order 12612 [52 FR 41685

(October 30, 1987)] still applies. This proposed rule will not have a

substantial direct effect on States, on the relationship between the

national government and the States, or on the distribution of power and

responsibilities among the various levels of government, as specified

in Executive Order 12612.

X. Executive Order 13084 on Consultation With Indian Tribal

Governments

Under Executive Order 13084, EPA may not issue a regulation that is

not required by statute, that significantly or uniquely affects the

communities of Indian tribal governments, and that imposes substantial

direct compliance costs on those communities, unless the Federal

government provides the funds necessary to pay the direct compliance

costs incurred by the tribal governments, or EPA consults with those

governments. If EPA complies by consulting, Executive Order 13084

requires EPA to provide to OMB, in a separately identified section of

the preamble to the rule, a description of the extent of EPA's prior

consultation with representatives of affected tribal governments, a

summary of the nature of their concerns, and a statement supporting the

need to issue the regulation. In addition, Executive Order 13084

requires EPA to develop an effective process permitting elected

officials and other representatives of Indian tribal governments ``to

provide meaningful and timely input in the development of regulatory

policies on matters that significantly or uniquely affect their

communities.''

This proposed rule does not significantly or uniquely affect the

communities of Indian tribal governments. This rule applies to

businesses, not government entities, submitting comments to

substantiate CBI. Accordingly, the requirements of section 3(b) of

Executive Order 13084 do not apply to this rule.

XI. Unfunded Mandates

Under Section 202 of the Unfunded Mandates Reform Act of 1995

(UMRA), Public Law 104-4, EPA must prepare a budgetary impact statement

to accompany any general notice of proposed rulemaking or final rule

that includes a federal mandate which may result in estimated costs to

State, local, or tribal governments in the aggregate, or to the private

sector, of $100 million or more. Under Section 205, for any rule

subject to Section 202, EPA generally must select the least costly,

most cost-effective, or least burdensome alternative that achieves the

objectives of the rule and is consistent with statutory requirements.

Under Section 203, before establishing any regulatory requirements that

may significantly or uniquely affect small governments, EPA must take

steps to inform and advise small governments of the requirements and

enable them to provide input.

EPA has determined that this proposed rule does not include a

federal mandate as defined in UMRA. The rule does not include a federal

mandate that may result in estimated annual costs to State, local or

tribal governments in the aggregate, or to the private sector, of $100

million or more, and does not establish regulatory requirements that

may significantly or uniquely affect small governments.

XII. Executive Order 13045

Executive Order 13045, entitled ``Protection of Children from

Environmental Health Risks and Safety Risks'' (62 FR19885, April 23,

1997), applies to any rule that (1) is determined to be ``economically

significant'' as defined under Executive Order 12866, and (2) concerns

an environmental health or safety risk that EPA has reason to believe

may have a disproportionate effect on children. If the regulatory

action meets both criteria, EPA must evaluate the environmental health

or safety effects of the planned rule on children, and explain why the

planned rule is preferable to other potentially effective and

reasonably feasible alternatives considered by EPA.

EPA believes Executive Order 13045 applies only to those regulatory

actions that are based on health or safety risks, such that the

analysis required under section 5-501 of the Executive Order has the

potential to influence the regulation. This proposed rule is not

subject to Executive Order 13045 because it does not establish an

environmental standard intended to mitigate health or safety risks.

XIII. National Technology Transfer and Advancement Act

Section 12(d) of the National Technology Transfer and Advancement

Act of 1995 (NTTAA), Public Law 104-113, Section 12(d) (15 U.S.C. 272

note), directs EPA to use voluntary consensus standards in its

regulatory activities unless to do so would be inconsistent with

applicable law or otherwise impractical. Voluntary consensus standards

are technical standards (e.g., materials specifications, test methods,

sampling procedures, and business practices) that are developed or

adopted by voluntary consensus standards bodies. The NTTAA directs EPA

to provide Congress, through OMB, explanations when EPA decides not to

use available and applicable voluntary consensus standards.

This proposed rule does not involve any technical standards, and

EPA is not considering the use of any voluntary consensus standards.

EPA welcomes comments and specifically invites the public to identify

any potentially-applicable voluntary consensus standards and explain

why such standards should be used in this rule.

List of Subjects in 40 CFR Part 2

Environmental protection, Administrative practice and procedure,

Confidential business information, Freedom of information, Government

employees.

Dated: October 19, 1999.

Carol M. Browner,

Administrator.

For the reasons set out above, EPA proposes to amend 40 CFR part 2

as follows:

PART 2--PUBLIC INFORMATION

1. The authority citation for part 2 continues to read as follows:

Authority: 5 U.S.C. 301, 552 (as amended), 553; secs. 114, 205,

208, 301, and 307, Clean Air Act, as amended (42 U.S.C. 7414, 7525,

7542, 7601, 7607); secs. 308, 501 and 509(a), Clean Water Act, as

amended (33 U.S.C. 1318, 1361, 1369(a)); sec. 13, Noise Control Act

of 1972 (42 U.S.C. 4912); secs. 1445 and 1450, Safe Drinking Water

Act (42 U.S.C. 300j-4, 300j-9); secs. 2002, 3007, and 9005, Solid

Waste Disposal Act, as amended (42 U.S.C. 6912, 6927, 6995); secs.

8(c), 11, and 14, Toxic Substances Control Act (15 U.S.C. 2607(c),

2610, 2613); secs. 10, 12, and 25, Federal Insecticide, Fungicide,

and Rodenticide Act, as amended (7 U.S.C. 136h, 136j, 136w); sec.

408(f), Federal Food, Drug and Cosmetic Act, as amended (21 U.S.C.

346(f)); secs. 104(f) and 108, Marine Protection Research and

Sanctuaries Act of

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1972 (33 U.S.C. 1414(f), 1418); secs. 104 and 115, Comprehensive

Environmental Response, Compensation, and Liability Act of 1980, as

amended (42 U.S.C. 9604 and 9615); sec. 505, Motor Vehicle

Information and Cost Savings Act, as amended (15 U.S.C. 2005).

2. Section 2.205(c) is removed and reserved.

[FR Doc. 99-27798 Filed 10-22-99; 8:45 am]

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