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Proceedings of the Standing Senate Committee on
Energy, the Environment and Natural Resources

Issue 13 - Evidence - February 22, 2007

OTTAWA, Thursday, February 22, 2007

The Standing Senate Committee on Energy, the Environment and Natural Resources met this day at 8:37 a.m. to review the Canadian Environmental Protection Act (1999, c. 33) pursuant to section 343(1) of the said act.

Senator Tommy Banks (Chairman) in the chair.


The Chairman: The Standing Senate Committee on Energy, the Environment and Natural Resources is continuing our examination of the Canadian Environmental Protection Act, 1999. We have determined to proceed along the lines of two case studies, the first having to do with mercury and the second having to do with perfluorinated compounds, PFCs.

Appearing before us today, from the Canadian Chemical Producers' Association, is Mr. Gordon Lloyd, and from E.I. DuPont of Canada Company, Mr. Paul Marriott.

Please proceed with your presentation, Mr. Lloyd.

Gordon Lloyd, Vice President, Technical Affairs, Canadian Chemical Producers' Association: Good morning. Before Mr. Marriott speaks more specifically about the PFC issue, I will speak about the general architecture of CEPA for managing substances, including PFCs. Although you are focusing on this particular case study, I think you are also interested in our views as to how that case study relates to the broader CEPA framework.

CEPA takes a broad and appropriate approach to chemicals management, and that applies to substances generally, as well as to specific provisions for substances that may have certain characteristics. Virtual elimination applies to substances that are persistent, bioaccumulative, inherently toxic, and found to be toxic under CEPA.

There are two broad approaches in the architecture of the legislation, as is true in other jurisdictions in the Organisation for Economic Co-operation and Development. There is one approach for new substances and one for so- called existing or grandfathered substances.

The specific provisions in CEPA for new substances would apply to any of the PFC family that were introduced into Canada as new substances as they would to any other new substances. They would have to undergo a risk assessment, and companies would have to provide certain information to Environment Canada and Health Canada depending on the level of the substance in commerce. The government could ask for additional information as well.

Canada's new substance notification provisions are similar to those of other OECD jurisdictions such as the United States, Europe, Japan and Australia. There are some differences in detail, but in all of these countries the new substance notification provisions have been fairly effective. Government provision of a sort of good housekeeping seal of approval for chemicals that are introduced into commerce has helped improve public confidence in chemicals management. Mr. Marriott can describe the fluorotelomer experience in the new substance notification area. There are some areas in which, although it has worked fairly well, there is some room for improvement for clarity and predictability.

Canada has a world-leading approach for improving public confidence in existing chemicals that were in commerce before the new substance notification requirements come into force. In the same way, the new substance notification requirements have helped improve public confidence. This started after CEPA, 1999 and it finished in September last year.

The government, using criteria identified by Parliament when CEPA, 1999 was passed, sorted through the 23,000 substances on the domestic substances list, DSL, of commercial chemicals. It identified approximately 4,000 substances that need assessment. Based on current knowledge, the government does not see the need for any further assessment of the remaining 19,000 commercial chemicals. If new knowledge comes up that may change, but for those 19,000 substances that should help in improving public confidence in their safety.

Our understanding is that Environment Canada and Health Canada, in the next several months, will set aside about 1,000 of the 4,000 substances concluding that, like the 19,000, they will not require any further assessment based on the information gathered through their process in categorizing the substances.

They have also identified about 200 chemicals that are of high concern and industry is being challenged to provide information to the government for those chemicals over a three-year period. The government will use that information in making their assessment decision on whether or not these are toxic substances. If they are toxic, they would be added to Schedule 1 and regulated under CEPA.

Several hundred other substances would have been seen as a high priority, high concern for assessment, but a survey that Environment Canada and Health Canada did indicated that these substances are no longer in commercial use. They were, when this inventory was created, but that reflected 1985 use patterns and things have moved on in the chemical industry and in commerce since then. They will receive a SNAC, significant new activity condition, which means they put a flag on the substance. If you are to use it for something new — in this case they are not being used at all — you would have to go through the basic substance notifications for them. They will not do the assessments on those substances because they are not in use, but if they were brought back into use, they would have to do a new substance assessment.

Canada will work with other jurisdictions, the U.S. and the EU, on about 800 to 1,000 substances because those substances are on the list for assessing and we want to cooperate, share resources, and work as much as possible. That will be coordinated bilaterally and it is also being discussed in the OECD.

It is also anticipated that Canada will, like the United States has, introduce an inventory update rule. That is what they term it in the U.S.; I am not sure what our government will call it. The idea is that working off a database from 1985 does not really make much sense in 2007. Industry will be required to provide an update on its inventory; what is being used and what is not. There are probably a lot of other substances that were used in 1985 that are not being used now. Based on some experience they had with the survey, there will probably be about another 1,000 substances that will be seen as not used and they will get this SNAC flag so that if they are reintroduced they would require a new substance assessment. That will leave Canada to assess an additional 1,000 to 1,200 chemicals. That will be done over a time extending to 2020, which is consistent with the timetable that the Europeans have set.

There are other mechanisms for identifying substances of concern. Suggestions can be made by the public for an assessment and the minister can require assessment on that basis. That used to be the way that most chemicals were assessed, but that did not prove to be very effective. That was the so-called priority substances list, PSL, process and clearly, the systematic approach that I have described will be more effective. If substances are restricted in other OECD jurisdictions, Canada has an obligation under CEPA to look at them and assess them in Canada. If something was missed in the categorization sort that has identified the substances for assessment those are a couple of safety valves that can be used to ensure that everything is covered.

If a substance is found to be toxic, there is a wide range of risk management options that include pollution preference plans, emissions controls and emissions trading. It also extends to bans and phase-outs or prohibitions, which is normally applied when this substance has an unreasonable risk that it cannot be managed otherwise. There are also special provisions in CEPA for virtual elimination of substances that are persistent by accumulation, inherently toxic, or found to be a risk to human health through the environment under CEPA.

We have not had much experience with how virtual elimination works. We will probably gather some of that as we go through the assessment for the 200 high priority substances for assessment, but to date there really has not been much practical experience of how the law operates. As we understand the law, stringent release limits will have to be set for virtual elimination of substances and these would have to be based on socioeconomic and technical factors, human health and environmental risk. The aim would be the ultimate reduction down to levels that could no longer be measured. It is similar to the approach in the Stockholm Convention on Persistent Organic Pollutants

Under this wide range of provisions, CCPA feels that CEPA is well equipped to deal with substances generally. That would include specific cases and Mr. Marriott will talk about related substances.

Paul Marriott, Technical Manager, E.I. DuPont of Canada Company: I would like to thank this committee for asking me to provide some input into CEPA, 1999, in particular as it relates to perfluorinated chemicals.

Fluoro products have been around for many decades providing a variety of benefits to society. From a CEPA perspective, the fluoro products have been of interest for several years due to the detection of PFCAs in the environment. An interesting aspect is that the PFCAs are not typically the product of commerce; however, they are a residual of some of the products at the ppm, parts per million, level. Of particular attention have been the eight-carbon versions of the acid, PFOA, and the higher homologues, carbon-containing materials. Their interest comes from their inherent stability, hence their long residence time in the environment.

In general, our experiences with the CEPA regulations and associated processes developed through stakeholder involvement show that the CEPA process works well. DuPont has been a willing and active participant in the stakeholder processes.

In the case of the PFCAs, Environment Canada has issued an action plan for the assessment and management of PFCAs and their precursors, which was published in the Canada Gazette in June 2006. The key components of this plan include the prevention of the introduction of new substances, which can contribute to the observed load of these longer chained C8s and above, PFCAs, in the environment. This included a prohibition on four new telomer-based materials and the consideration of ministerial prohibitions on any new long chain PFCA precursors.

For materials already in Canadian commerce, the action plan includes working with industry to significantly reduce the residual content, consistent with the United States EPA Global Stewardship Program, of which DuPont was the first signatory. The action plan also includes pursuing the assessment of the PFCAs in commerce, and to initiate further understanding through research and development to engage international partners in global action.

The international aspect of it is particularly important because Canada does not manufacture the perfluorinated materials; all of the manufacture of these classes of materials happens elsewhere in the globe. The goals of this action plan are consistent with the recent commitment issued by DuPont, of which you have a copy in front of you.

The action plan includes the prohibition of new telomer materials under the new substance notification provision of CEPA. I want to bring some of the issues to the attention of the committee.

In DuPont's opinion, the scientific basis of the prohibition was selective in its interpretation of the science. We found that in instances where there is significant debate about the interpretation of the science, CEPA contains no appeal mechanism. I believe, in some of the earlier depositions the committee has received that you have a sense of the state of the science. There are many assumptions and interpretations in the science around these materials.

The CEPA process does not contain an appeal mechanism. The only mechanism a company has to register a disagreement with the interpretation is through the legalistic and, hence, confrontational mechanism of a notice of objection and the request for a board of review.

The details of the board of review process itself are unclear. To our knowledge, there has been no occasion where a board of review has been struck and carried out. We believe that in instances where there is significant debate about the interpretation of the science, rather than a formal and legalistic approach, there should be a mechanism for a comprehensive peer review by an independent third party.

The U.S. EPA has such a peer review process, and has clear guidelines on what constitutes a peer review as opposed to a consultation process. I also believe that Health Canada, in certain aspects, uses a third party peer review process in some of its assessments of materials. Having a sound basis for the science is particularly important when taking a leadership position.

In conclusion, we feel that CEPA has the tools to provide the appropriate management of risk associated with chemicals. However, we do feel that there is a need for an appeal process, involving a third party peer review, where there is significant debate about the interpretation of the scientific basis for the proposed course of action.

The Chairman: Before we go to questions, would you please give us your view on the last point that you made about appeal and confrontation, and how that squares with or is opposite to the precautionary principle, which has been the policy of the Government of Canada for decades. Those two things operate against each other. One or the other of them is in place; they cannot both be in place.

Mr. Marriott: I understand the precautionary view. I think it stems from the fact that in cases such as this, you will never have 100 per cent of the information before you can make a decision. That is true in many things that we do and in science. It is always a shock to people to find out that science does not deal in certainties, it deals in probabilities. When you get into the case of complex things like the environment, it is very difficult to have that 100 per cent certainty.

Industry, in general, understands that the precautionary approach is required, but it must be applied on the basis of the science that is available and it must weigh both sides of the question. In this particular case, our issue is with the science as it was reviewed, certainly with DuPont and from an industry side. We had two of the materials that were prohibited; we are not protesting the prohibition, but we feel that we do not fully understand the basis of the science behind the decision.

Mr. Lloyd: I am not sure I would agree that they are in conflict. The precautionary principle says that you should err on the side of safety. There are many ways you could phrase it. The idea that you could have that perspective and some kind of formal board of review or a less formal science advisory peer review process, I do not think is inconsistent. In fact, I think the Privy Council paper that was put out by the government a year or so ago, on the precautionary approach and how it should be applied throughout the whole government, talked about the need to get external views. I do not think there is an inconsistency. There is a mechanism in CEPA for this, namely the formal notice of objection and the board of review procedure, but is it effective? That is the issue. I think the fact that it has never been used is probably an indication that it may not be as effective as it might be.

It might have been used once long ago, before I started in the job I have now. Someone mentioned that it had been used in the past. It certainly has not been used much. It is a very legalistic and formal approach.

The suggestion here is that the department would have a science peer review that could be triggered — and, again, I think that is consistent with the Privy Council Office perspective and precaution — and that one could go to where you have an issue of science uncertainty. You could have that looked at by that science board or this kind of peer review process to which Mr. Marriott referred. I do not think that is inconsistent with the idea of having the precautionary approach. It is a different way of doing it than the existing mechanism, which has not proven to be very effective in the formal board of review.

The Chairman: The precautionary principle, as it is presently stated, refers to scientific certainty and says specifically that the lack of scientific certainty in respect of a substance will not preclude it being omitted, prohibited, dealt with, reduced or whatever because, as you said, the idea is to err on the side of precaution. If there is a question about the substance and whether we should put it into the water, then we will not do so. The absence or proof that it is bad will not stop us from deciding not to put it in the water. That is how I understand the precautionary principle. To that extent, those two things are mutually exclusive.

Mr. Lloyd: The precautionary principle uses the words ``lack of full scientific certainty.'' The word ``full'' is used to set a threshold. There is 100 per cent scientific certainty and there is the area that lacks full scientific certainty, which means that there is a degree of plausibility that is not as close to the top as full scientific certainty provides. It might be 80 per cent. There is also scientific uncertainty at a level of 40 per cent or less, which does not reach even the plausibility level. In such cases, significant science questions are raised. They have not reached the stage of full scientific certainty and are not even close to being resolved. The word ``full'' is used to signal that there is room for discussion.

The prospects of having an advisory board or group of peer scientists would permit discussion of these areas of uncertainty and would be consistent with the precautionary principle.

Senator Milne: Unfortunately, I do not have the material with me from the last witnesses who appeared before the committee. They were strongly in favour of increased testing and increased precautionary approaches to the use of all of these long-chain manufactured chemicals.

One point raised by the witnesses was that bioaccumulation is fine. Bioaccumulation is mentioned in CEPA, but the included method of measuring bioaccumulation is in fats only. The bioaccumulation of any of these chemicals is not being measured in human muscle tissue. As well, they expressed concern about bioaccumulation of multiple similar substances. Rather than simply measuring bioaccumulation for a single substance, their concern is that the effect of multiple chemicals present in human tissue is not being measured.

We also had a fine presentation from Dr. Scott Mabury, who spoke specifically to the accumulation of chemicals used in the treatment of carpets and the methods of removal of residuals. He felt very strongly that if the residuals were removed, then the increased risk of accumulation in human beings and other animals around the world would decrease. Is DuPont doing anything about the removal of these residuals?

Mr. Marriott: As you will see in the recent announcement by DuPont, it is moving to the elimination of the use of the PFOA, which is the 8-carbon perfluorocarboxylic acid, by 2015, when the use of that material will be eliminated. DuPont is developing new processes to remove the residuals. We are moving to products based on shorter chain materials, which are less persistent. We believe that Environment Canada is looking to move in that direction. We have a combination of residual removal, substitution of the PFOA by other materials that are less persistent, and new processes for removing the residuals. It is a combination of material substitution and new processes to address that issue of residuals.

This has been a significant research and development program and a major investment. A few years ago, we did not have the technologies that we are talking about implementing and completing by 2015. Certainly, comments have been made in previous submissions to this committee about the need for large companies to work on this and other priorities. We have certainly put priority on this work, recognizing the concern about PFOA, although I should stress that no human health effects have been demonstrated by the PFOA.

In respect of our commitment to the impact on the environment, we recognize that we need to reduce this and are implementing those technologies. Absolutely, DuPont is working in that direction.

Senator Milne: That is admirable but 2015 is many years away. Have you considered using 3M's approach and taking some of it off the market for a while until you are ready to use the shorter chains substances?

Mr. Marriott: Again, we are speaking to residuals and the products where these are found provide significant societal value. The perfluorinated chemicals are used broadly in a range of applications, from firefighting foams to medical and automotive applications. It would not be possible in a short time frame to change the multiple industries that have used these materials commercially for decades. To ensure that the technologies and the industries are not severely disrupted, we will require a significant time frame.

As well, because the new lower homologue materials are new chemicals, they are required to go through the new substance notification processes. We need to submit to many regulatory-type processes involved in that time line.

Senator Milne: We have been told that because these molecules are so narrow and small, if you are testing for an 8- chain polymer, you will not pick up the presence of 10- or 12-chain polymers. Does DuPont test for these other longer molecules when a product is being developed? Do you test to see if any of the longer chain molecules?

Mr. Marriott: In looking at the process of moving to the lower chain materials and removing the residuals, we have found that if we put in a process to remove the residual of the C-8, it will remove the higher homologues as well.

In our development of the processes, we have not looked narrowly at removing only one but rather we have looked at the whole range of the higher homologues and have found that the technology that removes the C-8 will remove the higher homologues as well.

Senator Milne: That is encouraging. Have you done any testing on bioaccumulation in humans?

Mr. Marriott: DuPont is involved with a variety of programs that include medical assessments and programs including the workers in our plants. DuPont is involved in a variety of studies and programs. Some of these are very formal, under some legislation. Others are cooperative with the universities. DuPont is looking at a broad range of programs to study these materials.

Senator Milne: Do you know if any of them are involved in studies of bioaccumulation of multiple substances rather than just within one particular substance?

Mr. Marriott: I am not aware of whether the extent is to multiple actions of mixtures, no.

Senator Milne: Could you find that information for the committee?

Mr. Marriott: I can find that out, yes.

Senator Milne: That would be valuable for the committee because of the concerns that were raised by the witnesses who were here the last time.

I am still looking at 2015, and I am rather concerned about it, but you are going to have reductions of 97 per cent by the end of the year?

Mr. Marriott: Yes, in the voluntary program with the U.S. EPA the target was 2010. We are actually three years ahead. We are going to achieve the targets of that program by the end of 2007 as opposed to 2010.

Senator Milne: Teflon is one of your brand names, is it not?

Mr. Marriott: Yes, Teflon is one of our products.

Senator Milne: What sort of warnings do you put on Teflon products that are sold? What sort of an educational process do you do? Do you tell people how they should be used properly or how they should be disposed of? Do you do any of that?

I cannot remember reading any warning on my new Teflon frying pan. I do not recall reading about not using it over medium heat.

Mr. Marriott: There is a lot of misinformation around Teflon and the use of the Teflon trademark. The Teflon trademark is indeed a DuPont trademark. It is for the PTFE, which is polytetrafluoroethylene, which is a polymer. That material is not a PFCA. It is a long-chain polymer. That material, PFOA, is used in the manufacture of some versions of Teflon but not all. It is removed in the manufacturing process. There are very, very trace amounts in some of the Teflon. A variety of studies have shown this. There are no human health hazards associated with the use of Teflon cookware. There is no limitation of medium heat versus high heat. Extreme studies where extreme heat has been applied to the empty saucepan in a few instances have shown trace amounts of PFOA.

Senator Milne: The canary has dropped dead, has it?

Mr. Marriott: I do not know whether there was a canary in that particular test, but it is well accepted and EPA has commented that there is no human risk in the levels of exposure that would be involved even in those extreme abuse situations.

Senator Spivak: Mr. Lloyd, as you know there has been some discussion here about reverse onus. In the new substance notification provisions, we were told there are 700 or 800 new chemicals that are coming in every year. Could you give us a little more detail about how the manufacturers look at the data that they have to give to the government to assess? Is it 97 per cent that you say is safe? I am very interested in the bioaccumulation thing as well. Are you doing any testing? What is the general view?

Mr. Lloyd: As companies are developing products, they do their own testing and develop their own levels of confidence that the product is safe. If you are going to find something is not safe, you want to find out as soon as possible before you have spent a lot of money. Companies do that testing internally. The government also requires certain prescribed data for a new substance, and there is data about environmental effects and human health effects. There is an internationally agreed package with minor variations in different countries. There is an OECD base set of data that needs to be provided, and companies provide that data. Then Health Canada and Environment Canada look at it and can ask for more information. They do that when they feel they need to. Then they make a decision. They decide whether the substance is safe and if they feel it is safe, they add it to the domestic substances list. The U.S. does the same thing. They add it to their list, their Toxic Substance Control Act, TOSCA list. And the Europeans, before REACH came in, had a similar approach. They still have that approach. REACH has not come in yet. The company does its own level of testing, and that varies from company to company. I think that the OECD found that it really was not enough. There needed to be a government good housekeeping seal of approval assessing the information based on the test data they received from industry. In the final stage of the process, the government concludes whether they should put the substance on the DSL.

In effect, I am never sure what ``reverse onus'' means. I think this is a reverse onus. The company has to provide information to convince the government it can reach a conclusion that the substance should be put on the domestic substances list and commercialized. I think that is reverse onus. Similarly, in the program for existing chemicals, the government has indicated that for the 200 high concern substances, based on the information that they received in categorization, their predisposition will be, unless the company shows otherwise, that these substances should be found to be toxic. That is because they, on the environment side, have persisted. They are bioaccumulative and have inherently toxic characteristics.

Health Canada used a more complicated set of criteria. The companies need to provide information. For the Environment Canada persistence in bioaccumulation, most of the information was not hard test data; it was done by modelling. If the company had test data that showed it really was not bioaccumulative, then the model was wrong, and the models are not always right. They are very conservative. They are often good to make decisions on but, if you have real, hard data, that is more useful. For example, a company could show that it really is not bioaccumulative or it really is not persistent, and they can show that it is being safely managed. That is the kind of information the government is looking for. It has to be provided by the companies. If the companies do not provide the information, the government has indicated a predisposition to finding these substances to be toxic.

Maybe neither of these passes the legal definition of ``reverse onus'', but I am never quite sure of that legal definition. In both these instances, for new chemicals and existing chemicals, the onus is on the company for new chemicals and for existing chemicals, for these 200 high priority substances for assessment, to provide information to the government to convince the government that they should be determined to be safe. Nobody uses the language ``safe.'' CEPA talks about risk to humans or environment.

Senator Spivak: I am trying to understand the data, how long you test, whether you are testing for bioaccumulation or for trace amounts in hormone impact chemicals. Reverse onus, in broad terms, is that you must definitively prove that the product is safe.

You are saying, if I get you correctly, that we do not need to look at reverse onus in CEPA because it is already there. Is that what you are saying? Therefore, you do not need to change anything in your methods or your production of the data you give to government for assessment.

I hope you will tell me how long it takes, on average. Some companies spend years looking at their product. It must be difficult for the government to assess in the same intensive way, the 700 or 800 products or chemicals coming on market each year.

Mr. Lloyd: I agree with what you said, and it is basically what I said. There is a reverse onus. Although that language is not used, in practical terms there is a reverse onus in CEPA for new chemicals and in the way the categorization has worked for these 200 priority chemicals. I think that is already there.

The real interesting issue is whether the public would have more confidence in the company making the assessment or in the government also giving its good housekeeping seal of approval. The difference in the approach we have taken in Canada versus REACH in the EU is that we have said that the government should have a role in making the assessment determination.

The requirement in REACH is that the company does what they call a registration after which there is an evaluation that the governments can do. That is later and down the road and not necessary before the substance goes on the market. In Canada, that evaluation by the government is done then.

Senator Spivak: The public would have confidence if it understood more clearly, what the companies are doing to evaluate the safety or the lack of harm of a substance. If you look at the medical products that have come out lately, it has looked as if the manufacturers have completely ignored some of the side effects, which has led to items being taken off the market. You know what I am talking about. Are there different standards for different products? It would be interesting for us to understand the criteria. How you go about assessing whether a product is bioaccumulative or harmful in the environment. What is the difference between a consumer product and something that is only used in industrial processes? We need to have answers to those kinds of questions.

Mr. Lloyd: Different companies, in what they do internally, will differ.

Senator Spivak: Excuse me. And that data should be transparent.

Mr. Lloyd: The information is provided to the government under CEPA, and generally there is a transparency involved in this. There is certainly protection for confidential business information, but I think the kind of robust summaries that are produced, the health effects information and the environmental effects information, are available. I do not think that is the kind of information that is protected. I do not think that is really an issue.

There is a bit of an issue in terms of one company that spent an awful lot of money doing all of this testing. They are not so much concerned about the public knowing about it, but they are concerned about competitors getting a free ride. That has not been so much an issue in Canada, but it has been a big issue in Europe under the REACH legislation.

Senator Spivak: Mr. Marriott, has Teflon not been put on a time frame by the EPA to be removed completely?

Mr. Marriott: No.

Senator Spivak: What is the Teflon situation in the United States?

Mr. Marriott: The Teflon name covers a range of products, and they are regarded as safe to use by the public. At times, there is confusion about Teflon the product, and there are times when the PFOA gets classified as Teflon. PFOA, the short chain octanoic acid, is not Teflon. PFOA is a material that is used in a variety of applications in industry, one of which is in the manufacture of certain grades of Teflon, but it is not Teflon itself.

Senator Spivak: Have the particular types of Teflon that are using these PFOAs been slated to be taken off the market?

Mr. Marriott: It depends on the grade and the processing that is used to produce them. As I say, the Teflon trademark is used across a variety of products. These materials are part of that commitment that we are moving away from the use of PFOA. We have made that commitment. The products are considered safe to use. No human health effects have been documented around PFOA itself. Again, we are moving away from the use of that. It does not affect the safety of Teflon. Teflon products are perfectly safe to use, and the EPA recognizes that they are perfectly safe to use.

Senator Spivak: Some in the industrial sector have criticized the use of the word ``toxic.'' What is your view on the use of the word ``toxic'' in CEPA?

Mr. Lloyd: The use of the word ``toxic'' in CEPA probably causes some confusion.

We use the word ``toxic'' in CEPA in the context of a risk assessment, both hazard properties and exposure. Section 64 says you have to find those two things and, if you find them, you call a thing ``toxic'' and put it on Schedule 1. It uses the term ``toxic'' throughout the act to mean that, except in one place.

When we did categorization, we were not interested at the categorization stage in doing a risk assessment. We wanted to find a simple test, inherent toxicity: Does this thing kill fish? We wanted to have that, and we had to invent the term ``inherent toxic'' because we could not call it ``toxic'' because the term ``toxic'' was already occupied for when you did a risk assessment. ``Persistent or bioaccumulative inherent toxic'' does not mean toxic in a risk assessment context. It means a screen to see whether it is worth doing a risk assessment. Therefore, we had to invent this new phrase, ``inherent toxic.''

Under the Stockholm Convention on Persistent Organic Pollutants, Europeans and other countries do not have that problem. They use the term ``toxic'' in the same hazard context as we use the term ``inherent toxic.'' There is some confusion in the way we use the term ``toxic'' in the legislation. The word ``toxic'' means it has undergone a risk assessment, and, under certain conditions, there are exposures and hazards that need to be managed and controlled. It covers a wide range of substances. It covers dioxins, which are inherently toxic and which take much effort to minimize. It covers a wide range of substances including ammonia, which is perfectly safe to use in cleaning products, for example, and is in Windex. There is that wide range. You want to have that stigma attached to dioxin, but I am not sure you want that attached to your Windex. Some industries have been worried about that issue.

Just the issue of confusion between ``inherent toxic'' and ``toxic'' is a problem.

Senator Spivak: You are aware, of course, of the court case involving the word ``toxic'' and CEPA.

Mr. Lloyd: I thought that the environmental groups made a good point. CCPA has made it clear in all of our submissions that we would not want to undermine the jurisdiction of the federal government. I probably said that the last time I was here.

You should ask that question of the federal government lawyers. They proposed a solution that would have dealt with this in a budget bill a couple of years ago that was connected with climate change and other issues. This is not the best forum to deal with these issues. They presumably concluded that the wording they chose was still valid in light of the Hydro-Québec decision.

The point that the environmental groups have made that there is a risk involved in that is probably valid. If you were interested in pursuing that, it would be useful to ask the Department of Justice lawyers how they came down on that issue. I do not think my opinion is very relevant on that point. It is a good point the environmentalists have made. You must ensure that change would not undermine the validity of the federal government to be able to act. We fully agree with that. Whether the language that the Department of Justice people came up with would or would not is an interesting question that you might want to ask them.

The Chairman: Senator Spivak talked about the fact that companies spend years and hundreds of millions of dollars developing new products and those governments or whoever else is looking at their toxicity and how to categorize them have neither the time nor the resources.

What happens when a huge company that spends time and money on a substance finds it safe, while a small group finds it unsafe?

Did the big company miss the problem or did it decide the substance was not too much of a problem. Did the company think it was not a health hazard? Is it possible that scientists can differ in their opinions?

Mr. Lloyd: You would have to ask someone from Environment Canada or Health Canada for the exact statistics, but most new chemicals that come through the process, the companies have already winnowed out the things that will not pass. Most of the substances that come to Health Canada or Environment Canada for assessment are passed.

The Chairman: Two hundred substances did not pass.

Mr. Lloyd: Those are existing chemicals that were around before the new chemicals program. Even in that case, there are 200 out of 23,000. If you postulate how often people will disagree, if it is 200 out of 23,000, that is probably not unexpected. That was in the old system where we did not have as systematic an approach as we have with new chemicals. The percentage would be even less.

When you look at it that way, generally, there is agreement. There are a few instances when this is an extra level of check and balance and safety in the system, which we see as a good thing.

Senator Tkachuk: There is process with CEPA, but there are also a number of other processes, for example, the Fisheries Act and the Hazardous Products Act. Is there only one governmental agency or are there others to whom you must apply when you want to put a product on the market?

Mr. Marriott: It will depend on the field. If it is pesticides, medical products or pharmaceuticals, there are specific protocols. In general, for the chemicals, and from our perspective, the primary vehicle is the New Substances Notification Regulations under CEPA.

Senator Tkachuk: Are there provincial regulatory bodies as well or just the federal bodies?

Mr. Marriott: The one I am most familiar with is through CEPA

Senator Tkachuk: Earlier you had said that you would like to see a peer review or another option taken when there is some disagreement rather than a confrontational approach.

You mentioned that the EPA has such a process. How does that work? Can you help us as to how the other scientists are chosen? Is it by the two different groups or is it a panel that already exists, a third party panel? How does that take place?

Mr. Marriott: There are a variety of different processes. The EPA uses a science advisory board. I am not sure how they choose their membership. There is a distinct protocol that they have for a peer review. There are organizations that provide this service. I know that Health Canada uses a third party peer review process. A non-profit organization provides and coordinates the third party review process.

Senator Tkachuk: Are there any other amendments that you would like to see to the act?

Mr. Marriott: As I said at the start, from our perspective the act works well. There has only been this one instance where we feel that the jump to the legalistic and inherently confrontational process is too big of a step. We feel that a peer review process would be, in the few cases where this will occur, a better step as you can use a process of joint agreement on what constitutes the peer review panel and the process to be used. It can be more of a cooperative approach. The moment you go to the board of review type of approach, it gets into a legalistic confrontational process.

Senator Milne: He said the board of review had never been used.

Mr. Marriott: To my knowledge, it has never been used.

The Chairman: With respect to the four polymers, that you felt were unfairly banned, I do not know if it was your company, but why would the company involved not go to the board of review if they thought that was wrong?

Mr. Marriott: Two of the four materials were DuPont materials. We are not protesting the federal government's authority to make a decision to ban, however we do contest the scientific basis used and do not understand why certain scientific data and arguments were excluded in the decision and why certain parts were included. We are protesting the scientific basis.

We have filed a notice of objection and we have requested a board of review. That is the only step available to us to register our protest and we do so reluctantly. We would much prefer to go to a third party review that looked at the science that was cited and the science that was not cited but maybe should have been. That is the process we would like to have included in cases like this rather than have to register this notice of objection.

The Chairman: You will now ask to go before a board of review?

Mr. Marriott: Yes, and we have had discussions with Environment Canada asking if there is an option of a peer review process.

Mr. Lloyd: I do not think they will get a board of review because it is up to the minister. They are asking the minister, who has made the decision, ``do you agree to have a board of review to review your decision?'' The minister's predilection is probably to say no. That is probably why, other than this one that may have occurred in the distant past, this is not used. It is not a very useful procedure. As Mr. Marriott said, it is a request for a board of review; you do not have any rights to that.

Regarding other amendments to CEPA review, we have not pushed hard on that because we do not think that is the right solution even if we got it because it could get into that confrontational, legalistic approach. It is hard to say because we have not seen them operate, but the kind of EPA approach makes more sense to us.

To answer your question about whether there is anything else we would like to see changed in CEPA, it has nothing to do with what you are talking about now. In this area of chemicals management the provinces have basically deferred to the federal government. Ontario, back in its labour legislation, had some provisions for assessing chemicals, but I do not think it ever really used them. It deferred to the fact that the federal government does this and CEPA is seen as the tool.

In other areas, the provinces control what companies do either through regulations, permits, certificates of approval, et cetera. Different provinces have different labels that they put on this thing that I will colloquially call ``regulation.'' One of the things we would like to see improved in CEPA is the so-called equivalency provisions. The kind of improvement that I think would make sense has been drafted and stuck into Bill C-30. I do not know what will happen to that bill because it is tied into a lot of controversy on climate change, but this is a narrow technical thing that we think needs to be improved in CEPA. Federal standards or rules need to be developed. If a province can implement those rules, then there should be an ability to have an agreement between the federal government and the province.

At present, that is allowed in CEPA if the provincial government has a regulation, but the provinces tend to operate by permits and certificates of approval and not by regulations. As we understand it, the federal lawyers have said that is not good enough; there must be a regulation, because even if there were a permit or a certificate of approval, it would not meet the requirements to be able to have an equivalency agreement.

The language in Bill C-30 broadens the CEPA language that talks about an equivalent regulation and equivalent effect. That is in there so that the province and the federal government could enter into an agreement if there was a provincial permit or certificate approval in the provincial regime other than a regulation. That is an amendment that we think should be made to CEPA either through the work done on the CEPA review or in Bill C-30, et cetera. That is an important amendment.

In the past it has not been as critical because there has not been as much federal involvement as I think there will be in the future in regulating areas that are already regulated by the provinces. We can see that there will be a broader scope for federal involvement in things that were traditionally provincial going beyond what we are talking about today and into the air pollutant area, and so on. That is a very important change in CEPA

Senator Tkachuk: If we have a peer or another review of a decision made by the federal government, would the decision by this other panel be binding? Would that be the end? Would there then be courts or whatever as a possibility to hear it? How would this work? Would it just be a recommendation back to the original decision maker?

Mr. Marriott: A peer review, in this particular case, could happen. We would examine the whole scope of the science and provide feedback on what and was not included in the decision.

At the end of that process, the federal government can still decide to say yes based on the process. The government can say it believes that the materials should be prohibited. We fully recognize that is both a possible and likely outcome. However, the record of the science that is the basis of that decision would be improved. In this particular case, that is our issue. The science today, in the record of the decision, has been selective and not comprehensive. We feel that would improve the science.

We would not look to undermine the government's responsibility to say yes to a ban under a precautionary approach. However, if this becomes the standard on which other jurisdictions base their decisions, we believe that record should be comprehensive rather than selective.

Mr. Lloyd: You also must look at how the decision-making process in CEPA works, and how that would fit in. We are not looking at this peer review group making the decision; all they do is improve the understanding of the science.

First, in the decision-making process, the two ministers come to a conclusion. Then they make a recommendation to cabinet; and it is cabinet that decides to add this substance to the list of toxic substances in Schedule 1. Cabinet almost always agrees. There are some instances when Cabinet did not, such as the road salt issue. However, if the ministers went to cabinet and said they want to add a substance, and the peer review group said that the science that Environment Canada and Health Canada used did not make any sense; they should have come to a different conclusion that would be useful information for cabinet to have.

I do not think the minister would go forward to cabinet normally if the science advisory group disagreed with what their officials had said. It would leave the decision in the government, but it would provide additional information that would be useful to the ministers of Environment and Health in deciding what they would recommend to cabinet. If they recommended something different, it would provide cabinet with some information that would be useful to them in coming to their conclusion, because the final decision rests with the cabinet.

Senator Tkachuk: We heard testimony that after CEPA, those chemicals were grandfathered. At the same time, you are telling us today that because of changing science, a lot of those substances have been looked at again. Some of them have been put aside and they have said there is no problem with these; these are the ones we are looking at. We have discussed these 23,000 substances.

When CEPA approves a particular chemical, is that the end of the story? If science changes, which it does — new technologies, new information, et cetera — is there a process to bring that information back to the table? Is there an onus on you to continue testing? How does it work? Is there a permit that states, ``for what we know now?'' How do we watch that chemical?

Mr. Lloyd: There are a few things. First, there is an obligation — and Canada is like other jurisdictions in these areas — if a company comes across new information about the substance being toxic, they need to pass that on to the government. That is section 70 or section 71 in the act.

There is also the requirement that if any other jurisdiction looks at this chemical and decides to severely restrict it, Canada needs to look at it as well. That would be another avenue for a second look.

The public, through this process that is still there that was used previously in the priority substance list approach of saying that we want this chemical looked at, can still suggest that to the minister as well. There are a lot of avenues there so that if new science and information comes along, that is factored in and things can be changed.

Senator Tkachuk: What is the process? Do they bring you back? Do they start again? Let us say the EPA says that they have a problem with a certain substance. What does Canada do? What is the process, or have we had situations where that has happened?

Mr. Lloyd: I am not exactly sure. Let us take the example of the severe restriction and the EPA finds out. The substance would then be brought forward for an assessment. The company would certainly know about that and they would be asked to provide information.

Frankly, I do not know how to answer your question. I do not know if it has ever arisen with a new chemical that has been put on the list.

Senator Tkachuk: Is it because it CEPA is so current?

Mr. Lloyd: Yes, there are two reasons. First, it is current; and, second, there is the point that I made earlier, namely that the government assessing this under the new substance notification is the last check in the process — the company has already gone through a lot of assessment. I am sure there will be times when this occurs, but it will not be a regular type of occurrence. I do not know, in practical terms, how that would work; I am sorry.

Senator Tkachuk: I wish to ask one more question from a point of interest, although we may be able to make a recommendation on some of this. I am a fan of finding as many areas, when harmonization works, to practice it. In this country, we cannot even harmonize our securities law, never mind trying to work with another country.

Europe, the United States and Canada, should make an effort to create efficiencies by harmonization, where possible. You can have Kyoto and CO2, but if the EPA does the test and it passes in the United States — or in Canada, if it would pass CEPA — how much of that information is taken when you make your presentation to the EPA? Is that information taken into consideration? Do they say, ``That is good enough for us''? How does that work? Are there ways that we can see into the future to make this work?

Mr. Lloyd: That is another area where we would like to see changes in CEPA. Probably the biggest change would be the one I talked about earlier in terms of the equivalency with the provinces. The second biggest change would be to try to move what you are talking about further a few steps.

Canada has done well on part of this. In CEPA, 1999, we have a provision that says that our government can enter into agreements with other governments and share the information they received on the assessment with them, provided there is confidentiality for the confidential information parts and the other government has laws that respect that. That is a good step. Unfortunately, the United States does not have a similar provision in their legislation.

The Europeans mirrored the language used in Canada when they developed REACH so that they would be able to have agreements with us. They called it the ``Canada clause,'' and Australia has a similar provision. This ability for governments to share the information is important. Canada has opened the door and other countries are following suit.

Certainly, when companies go into another country, such as the U.S. or Australia, they bring forward the information that they provided in Canada so that those governments will be aware of the assessment decision. Some work on a pilot basis at the OECD involves the notification process by companies going into a number of jurisdictions. They are trying to figure out how those companies can work on that together.

In respect of CEPA and changes to the legislation, we would like to see if Canada could emulate the Australians, who have a legislative provision to recognize another jurisdiction, thereby recognizing its assessments. Certainly, it would be useful for Canada to take that extra step and have the legislation reflect such recognition. Some officials at Environment Canada have told us that a legislative amendment might not be necessary because they might be able to do it administratively. Still, it would be useful in the legislation. It would be the opposite side of the coin of the provision I spoke to earlier that says that if another jurisdiction has found something severely restricted, then Canada should take that into account. It would be useful if there were a provision to recognize that if another jurisdiction has passed a chemical, we should consider that decision. It does not mean that we would always add it to the DSL because there could be exposure factors in Canada that would need special consideration. When this was discussed at the OECD, the Australians spoke to the ``koala factor.'' Such factors might mean not translating a decision from one jurisdiction to another without additional checks — perhaps in Canada it would be the ``beaver factor.''

The Chairman: The ``cold factor.''

Mr. Lloyd: Fair enough. It would be useful if CEPA had some language pointing in that direction, even if these recognitions can be done administratively. It would be beneficial to have a signal in the act that recognition of other jurisdictions is a good idea. Some things are happening in the direction that you talked about and countries are working on that at the OECD and in Canada-U.S. discussions. CEPA could be amended to help push that along.

The Chairman: Dr. Marriott, Senator Tkachuk asked you about the process and I heard you describe what you think would happen. Let us assume for the sake of the argument that the makeup of either a board of review or a peer review would be objective and would perform essentially the same function. Would it achieve what you are after if you had a right to a board of review as opposed to making an application to a board of review? Do I understand that correctly?

Mr. Marriott: It is a difficult question to answer because we do not truly understand what a board of review would look like and how it would operate.

The Chairman: We also do not understand what a peer review board would look like. One would assume that both would be chosen of people who would give an objective, scientific opinion.

Mr. Marriott: There is more documented description of what peer reviews are and how they operate than there is this of boards of review. Yes, it is difficult to say how it would operate. Certainly, our preference is to have a step that is not a legalistic confrontational approach but rather is a working-together approach. A peer review board provides such an approach as opposed to a board of review. That is one aspect of the peer review approach that we prefer.

The Chairman: Do you think that it should be mandatory if it is requested by the company that has the proprietary interest in the substance?

Mr. Marriott: I do not know whether ``mandatory'' is too strong a word.

The Chairman: If you ask for it, you get it.

Mr. Marriott: It should be such that the onus will be asked for in rare circumstances and, therefore, if asked for, there needs to be really strong reasons why you would not get one.

Senator Mitchell: Mr. Marriott, you mentioned that there is not an appeal process under CEPA. It seems to me that when you talk about a board of review or a peer review process that is the appeal process. Do you envision another kind of appeal process?

Mr. Marriott: Well, the notice of objection is the only way to register that you do not agree with findings, and then you can ask for a board of review. As Mr. Lloyd said, it is at the discretion of the minister whether a board of review is granted.

Senator Mitchell: To that extent, you are saying that CEPA does not have an adequate appeals process.

Mr. Marriott: Yes, that is right.

Senator Mitchell: Two of the elements of your vision of an appeals process would be, first, a peer review feature; and second, not at the sole discretion of the minister to act on it or to call it. Is that correct?

Mr. Marriott: That is correct.

Senator Mitchell: It would seem that the other side of not having the reverse of reverse onus means that a great deal of responsibility for consumer protection rests with consumers. Earlier witnesses pointed out that it becomes difficult because the area is so complex, the dissemination of knowledge is spotty, and an average Canadian would have difficulty assessing all of that information. The implication of what you are saying is that there is a problem with releasing too much information because of the implications for competitiveness in an industrial competitive setting. Under the Pest Control Products Act, there is a specific initiative to separate test data from other confidential business information, and that data are released.

Could you see that being applied under CEPA to your kind of chemicals and industrial processes? Do you envision a place where your information could be protected while releasing more information to the public?

The Chairman: For clarification on the question, Senator Mitchell, do you mean that the test results are released to the public?

Senator Mitchell: Yes, it separates test data from other confidential information and makes the test data accessible to the public.

Mr. Lloyd: There is not a fundamental problem with that. Another issue that we did not talk about was so-called high-production-volume chemicals. The OECD, following the U.S. lead, became very involved in this. There has been collaborative work by companies and chemical associations around the world to try to ensure that the data gaps are filled and the public has information available on these high-production-volume chemicals. The Americans had a broader target of 2,000 HPV chemicals and the OECD picked 1,000. The data have been provided for most of those chemicals, although a few are still being worked on that did not quite meet the target. That was deemed good progress and has been very helpful.

The companies generally recognized that the information should be available. Under CEPA, the information is available because there are provisions that prevent the companies from claiming confidentiality for things related specifically to health and the environmental aspects. Even if a company wanted to make that claim, it is not allowed to do so. That is not what companies are interested in protecting. They are interested in protecting confidential business information about formulations et cetera. Information would be available under CEPA now, if it were asked for. The chemical industry has made it available on those high-production volume chemicals. It is also made available quite extensively, through material safety data sheets. Now, that is a communications vehicle for workers, not so much for consumers. There are a lot of concerns in the occupational health and safety world that these materials data sheets are full of information. There is a lot of information, and it is almost not useful because there is so much of it. When you buy paint at Canadian Tire, there is label with information on the can. I do not want a material safety data sheet on it. I do not think there is any disagreement on the availability of that kind of information. I think it is already accessible under CEPA now, if somebody asked for it.

Senator Mitchell: If a peer review process were to work, there would have to be full disclosure to the test data and anything that would be remotely relevant to that assessment. Would you say that the peer review process might therefore have to be a private process or would it be open and public?

Mr. Lloyd: That is a good question. In general, it would be able to be open and public. Dr. Marriott is nodding. I would think it should be designed so that in the rare circumstances it arose that some formulation information, how things were put together actually did go to confidential information, that was important to the company, that there be an ability for that to be held in camera or in some other way than the normal proceedings.

The Chairman: Mr. Lloyd, you represent an association that has, according to this list, 58 members. It includes the big people like E.I. DuPont and Imperial Oil and Shell Canada and Dow Chemical and Domtar Inc., et cetera, which have greater resources than their small competitors.

When a means is found of making a substance less dangerous, does your association help the smaller folks with useful information? I know that you cannot give them proprietary information, but when a process is found by DuPont or by 3M, as we have heard, to make something less dangerous in the environment, do you disseminate that information? Does your association work to make sure that all of its members have access to that information and make good use of it?

Mr. Lloyd: I do not think my answer is going to be very clear, because the answer is both yes and no.

We are what we call a horizontal association. You can subdivide the chemical industry into all kinds of different product areas. We have members that are also members in the paint area and consumer products. We have members that have chemicals that are very different than other members. We tend not to get involved in product specific aspects. The kind of stuff you are talking about would be more products specific. I think more vertical associations may do more of what you are talking about in the style that they work in. That is the ``no'' part of my answer.

Responsible care is a basis for trying to make sure that we manage chemicals more effectively and that the public is confident in how we are managing them. This is something that was invented in the mid 1980s. It is used worldwide and is part of the solution of effective chemical management.

As part of responsible care, there are books, codes, and all kinds of practices that affect many areas in chemicals management. However, we also have advisory panels where each of our companies has a community advisory process. We have a national advisory panel as well. We also have things called responsible care leadership groups; the CEO'S of of each of the companies get together and talk about how they are making responsible care work, and sharing among each other. In that kind of context, that is probably where, if things were identified along the lines that were of broad interest, they would be shared. We have done more of that in areas like process safety management and safety and best practices. There has been a fair amount of that kind of sharing. It is an area that we could work. If it came up, where it made sense, could also share in this kind of area that you are talking about. I think more often that would happen in the narrower silo vertical associations.

The Chairman: The companies that are making polymers should talk to each other.

Mr. Lloyd: It is probably even more complicated than that.

The Chairman: It sure is, and there is no way on earth that I will understand it.

Senator Spivak: Maybe you could give us a written answer of the kind of objectives of your data collection with regard to testing, persistence, bioaccumulation and inherent toxicity and assessment. For example, women and children are very different in terms of their reaction to chemicals. That information would be useful to this committee. I am not asking for reams of data, but information on this topic.

The ecosystems approach in CEPA is difficult and it is only in the preamble, but it has very practical effects. For example, in my own province, Lake Winnipeg is sick. The provincial government is interested in banning the phosphates in dishwater detergents, which I did not realize were not banned, because they are banned in the laundry detergents.

In your initial look at a product or a chemical, how would you incorporate the ecosystem approach?

I know that is probably quite difficult and other pieces of legislation look at that approach.

You need not answer those two questions now, but the committee would appreciate a written answer.

The Chairman: The first question might want a written answer later. Is there an answer that you could give now, Dr. Marriott or Mr. Lloyd, to the second question, the applicability of the ecosystem, and philosophical approach to what you do?

Mr. Marriott: The one comment I will make is that when you are developing chemicals or products, one of the things we look for, and there are a variety of forums, OECD, et cetera, is that there is an accepted set of test criteria to look at in the screening of the products.

We need to be efficient and cost-effective. We cannot have each jurisdiction saying it wants a specific set of tests. We look for those standardized tests that will be accepted around the globe by the various regulatory bodies. These are tests for toxicity, et cetera. These are the key tests that we want you to look at. A lot of that goes on, and there are many standardized accepted tests.

As we get into ecosystems, it becomes more complicated, because it becomes a regional concern, as in the case of Canada or Australia's ecosystems. Certainly that is the type of approach that a variety of bodies around the world are trying to come together on and say to industry that these are the key tests we want you to do. That is the philosophical approach.

Senator Spivak: Do you do a test for effluent into the water systems?

The Chairman: Thank you, Mr. Lloyd and Dr. Marriott. We look forward to the answers to the questions that Senator Spivak just asked, and I expect we will hear from you again. You may hear from us again as well.

The committee adjourned.