INSIDE VIEW '13: SOCMA to advocate US competitiveness, expansion

26 December 2012 21:00  [Source: ICIS news]

By Lawrence D. Sloan
President & CEO
Society of Chemical Manufacturers and Affiliates (SOCMA)

Editor’s note: US chemical industry association leaders were given the opportunity to express their views on the challenges and opportunities for 2013.

As expected, little legislative activity took place in 2012 as political paralysis continued in Washington and much attention was focused on the election. Unfortunately, while the uncertainty associated with the election is behind us, the political gridlock remains. We at the Society of Chemical Manufacturers and Affiliates (SOCMA), however, will continue to fight for our small and medium-sized members, and in 2013, will focus on the reform of harmful regulations and the strengthening of policies that make growth and innovation a top priority.

Regulatory reform will be a key component of our strategy in 2013. Part of that effort will involve educating government officials about how the extent of regulations affecting the chemical manufacturing industry negatively impact our productivity, ability to be innovative and competitiveness compared to comp­­­­anies in Asia, South America and even Europe.

We are committed to operating in a manner that ensures the safety of our employees, communities and the environment. The success of our ChemStewards® environmental, health, safety and security initiative, which all manufacturing members must not only commit to, but show continual progress towards achieving through independent third-party verification, is a testament to that fact. On May 22, we’re hosting the National Chemical Safety Symposium in Houston, Texas. National and local authorities on process and occupational safety will present the latest trends and methodologies used in the industry today to create a safe and secure manufacturing environment.

SOCMA also supports regulations designed to ensure a safe workplace and lower toxic emissions. However, many regulations are duplicative, unnecessary, contradictory and/or clearly prevent our industry from leading the world in innovations. Concrete reform of these existing regulations, as well as our current regulatory process, is needed. SOCMA’s website was created as a platform for educating members of Congress and their staffs about how our membership is disproportionately impacted by regulation, both as chemical manufacturers and small businesses.

The Toxic Substances Control Act (TSCA), our nation’s chemicals control law, is one significant example of a regulation in need of reform. Stakeholders across the board agree the statute needs to be updated, but they can’t seem to reach consensus on a specific path forward. SOCMA has consistently advocated that TSCA requires carefully tailored fixes and that sweeping changes won’t work. In order to increase the prospect of bipartisan support for reform, we need to identify those areas where there’s consensus, such as protection of confidential business information (see below), prioritisation of chemical risk assessments, resetting the TSCA inventory and the new chemicals program.

We hope in 2013 Congress won’t waste any more time with comprehensive reform efforts that have proven to be unsuccessful, such as the Safe Chemicals Act of 2011 introduced by Sen. Frank Lautenberg (D – NJ). On a positive note, Senator David Vitter (R –LA), who is replacing Senator James Inhofe (R-OK) as the Ranking Member of the Senate Environment and Public Works (EPW) committee, has indicated he will provide an alternative to this failed approach. He plans to introduce TSCA reform that places an emphasis on weight of evidence and strong federal preemption and includes the critical input of the regulated community.

The Chemical Facility Anti-Terrorism Standards (CFATS) is, however, an example of a robust and comprehensive regulatory program that helps ensure chemical facilities are protected against attack, but does so without impairing the industry’s ability to remain innovative and competitive. But following an internal review by the Department of Homeland Security (DHS) that identified significant shortfalls in the agency’s progress towards full implementation, permanent reauthorisation now remains in doubt.

SOCMA applauds DHS for conducting the internal review and the efforts it has made to address the program’s shortcomings. We support the program and urge Congress to provide adequate funding and enact a long-term reauthorisation of CFATS to eliminate the uncertainty of one-year reauthorisations, which do little to help the chemical sector allocate proper resources and plan more effectively. We also encourage DHS to engage more with the chemical sector and Congress to continue its oversight in order to ensure regulatory certainty.

Another issue we are discussing with Congressional representatives and the White House is related to a recent proposal by EPA to expand its authority under existing regulations. This proposal involves the elimination of confidential business information protections and would force chemical manufacturers to reveal highly proprietary details of new chemicals even before they are commercialised that would be made available to the public on the Internet. Such a requirement would deal a significant blow to our industry’s ability to maintain our competitiveness and protect intellectual property (IP), which is another key issue.

As members of an innovation- and technology-driven manufacturing sector, U.S. chemical companies find themselves targets of corporate espionage and intellectual property theft by foreign entities, currently with little recourse. SOCMA is working to get the message to Congress and the administration that the violation of companies’ IP not only reduces current profits, but also affects the long-term sustainability of their businesses due to unfair competition. Stronger actions need to be taken with governments that permit, and sometimes participate, in the stealing of US chemical manufacturing IP.

Chemical IP comes at a great cost, too. Because of the highly innovative nature of specialty, custom and batch manufacturing, the investment SOCMA members make in research and development (R&D) is significant. The federal tax credit is important to SOCMA members and chemical manufacturers in general, and helps keep the U.S. competitive in the global race for R&D investment dollars. The constant need for and slow pace of renewal of the tax credit causes great uncertainty, and SOCMA is strongly advocating for Congress to make this credit permanent.

We also continue to push for movement of the trade policy agenda. In particular, SOCMA is advocating for high standard free trade agreements, such as those with Korea, Colombia and Panama, which will save U.S. chemical manufacturers billions of dollars and provide a way for our members to fairly access foreign markets and positively contribute to the growth of the U.S. economy.

The chemical industry is recognised as a key driver of economic growth in the United States, but to remain so, chemical companies must be able to operate in an environment that allows them to innovate and maintain a competitive position in global markets. At SOCMA, our advocacy efforts in 2013 will be focused reforming laws that threaten our industry’s competitiveness, the adoption of policies and systems that encourage innovation, and the support of programs that enhance the safety and security of our employees, facilities, the communities we work in and the environment.

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