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New California Policy Requiring Registration of Pesticide Treated Textiles Creates Regulatory Wrinkles for Manufactures and Retailers

September 5, 2017

As of July 1, 2017, pesticide treated textiles that include claims regarding antimicrobial or other pest resistant qualities (“pesticidal claims”) must be registered as pesticides with the California Department of Pesticide Regulation (“DPR”).[1] The registration requirement has numerous business and legal implications for companies that sell these products under their company name (“manufacturers”) and for retailers that sell these items. Covered products may include apparel (e.g., antibacterial or insect-resistant clothing, socks, and undergarments) and non-apparel (e.g., bath mats, shower curtains, bedding, tents, mouse pads, etc.). In addition to registration, manufacturers are required to comply with product labeling, recordkeeping and reporting requirements and must pay a product fee to DPR of 2.1 cents per dollar on California sales of these products (“mill assessment”). Retailers that bring or sell covered products into California from outside the state may also be subject to pesticide mill assessments and quarterly reporting requirements if the mill assessment was not paid by the manufacturer or supplier.

Implication: Manufacturers of covered products must obtain a California pesticide registration from DPR for each pesticide treated textile product or product category and must renew the registrations annually. As discussed below, by making federal pesticide registration a prerequisite to California registration, the new DPR policy is also likely to push additional manufacturers to register their finished products with the U.S. Environmental Protection Agency (“EPA”). Manufacturers and retailers who wish to avoid having their pesticide treated items regulated as pesticides in California and at the federal level should ensure that the products and claims are designed to meet the treated article exemption.

Registration

Historically, California allowed the sale of pesticide treated textiles so long as the pesticides used to treat the material were registered and/or companies that treated bolts of fabric marketed as pest resistant registered the fabric as a pesticide. In December 2015, California DPR signaled that it would change its approach and require finished products made with pesticide impregnated materials to be registered as pesticides in California if the products include pesticidal claims. See California Notice 2015-13.[2]

In subsequent notices, DPR explained that a manufacturer may use a single California pesticide registration to cover multiple finished products so long as:

  • The products are in the same use category (use categories are “apparel” or “non-apparel”);
  • The products are sold under the same brand;
  • The products contain the same type and percentage of active pesticide ingredient; and,
  • The pesticide chemical used to treat the different items is registered under the same U.S. EPA registration number.

If different fabrics or materials are used to make the products, applicants must list them on the Confidential Statement of Formula section of the registration application and DPR may evaluate them separately. Additional guidance on registering pesticide impregnated textiles is available on DPR’s website, including a sample application for registration.[3] DPR assigns a separate California pesticide registration number to each pesticide treated textile product or product category registered. To keep the registration active, a registrant must annually renew the registration and submit a renewal fee.

Labeling

DPR does not require registered pesticide impregnated products to be labeled with the California pesticide registration number, but the products must bear a label approved by U.S. EPA under the Federal Insecticide, Fungicide and Rodenticide Act (“FIFRA”), 7 U.S.C. §136 et seq.,[4] which bears the EPA pesticide registration number. To be accepted by DPR, the proposed labels must also include the brand name under which the product is registered and sold in California.[5] Since pesticide labeling is highly regulated at the state and federal level, future changes to the product label may require approval by DPR and EPA prior to sale or distribution.[6]

California Mill Assessment

California requires pesticide registrants (manufacturers), or in some cases distributors or retailers, to report and pay pesticide mill assessments on a quarterly basis.[7] A California mill fee of 0.021 cents per dollar is assessed on each registered pesticide sold for use in the state.[8] For example, a company that sells pesticide treated tents under its registered brand would report the total quarterly sales of the tents sold into California (price charged for tents) and then multiply the total sales amount by 0.021 to determine the mill fee due. California law requires that commercial invoices reflect the payment of the fee on the invoice.[9] To track collection of mill fees, DPR requires pesticide brokers and dealers to register with DPR, keep sufficient records to show that fees were remitted, and retain those records for four years.[10]

In cases where the registrant does not sell or deliver the products directly into California or have knowledge that the registered products will be sold in California, the distributor or retailer that first sells the products into California is required to collect and remit the mill fees to California DPR, with the fee calculation based on the retail price.[11] In cases where a retailer is making the first sale into or within California and remitting the California fees, the retailer may also be required to register with DPR as a pesticide dealer.[12] Retailers that are not equipped to track California sales and remit quarterly mill payments should discuss mill fees with their suppliers to assign responsibility for reporting and paying the fees by contract.

Exemptions

There are several exemptions from the California requirement to register pesticide treated products, one of which is based on the federal “treated article exemption.”[13] California historically took the position that products meeting the federal treated article exemption are exempt from registration in California, and DPR reiterated the position in its policy documents regarding pesticide impregnated materials.[14] To qualify for the federal treated article exemption, the pesticide treatment must be added to the item solely to protect the item itself (rather than to protect users of the product from pests or microbes) and the pesticide used to treat the item must be registered with EPA for such use. For example, an outdoor furniture cover treated with a pesticide to inhibit the growth of mildew may qualify for the treated article exemption if claims related to the pesticide treatment relate only to the protection of the cover from degradation by mildew and if the pesticide used to treat the cover is registered for that use. In contrast, the same product sold with general mildew fighting claims or treated with a chemical not approved by EPA for treating this type of material or product would likely fall outside the treated articles exemption.

Potential Penalties

Although criminal penalties are available under the California statute, violations pertaining to pesticide registration or mill assessments are generally addressed via civil or administrative penalties or negotiated settlements. Under California Food & Agriculture Code section 12998, violations of the California pesticide statute and regulations outlined above are subject to civil liability of between $1,000 and $10,000 per violation. In lieu of civil prosecution, DPR may levy an administrative penalty not to exceed $5,000 per violation under California Food & Agriculture Code section 12999.4 and/or negotiate an administrative settlement.

A list of negotiated DPR settlements is available on DPR’s website, posted by quarter.[15] Negotiated penalties for sale of unregistered pesticide treated products and/or failure to pay mill assessments in the past two calendar years ranged from a few hundred dollars to over one hundred thousand dollars.[16] Given the explicit California policy on pesticide impregnated materials, we anticipate that DPR will increase its enforcement in this area.

Additional Information

If you have questions regarding how the California pesticide impregnated materials policy applies to your business or whether your products may qualify for the treated articles exemption, please contact Laura Duncan.

[1] California defines “pesticide” to include any substance or mixture of substances intended to be used for … preventing, destroying, repelling, or mitigating any pest [as defined] … which may infest or be detrimental to … man, animals, or households, or be present in any agricultural or nonagricultural environment whatsoever. Cal. Food & Agric. Code § 12753.

[2] In announcing the policy, DPR stated that the change was made in part to bring these products in line with other pesticide treated items that require registration as pesticides, such as flea and tick collars and antibacterial surface wipes. DPR also expressed an interest in tracking the potential impacts of pesticide treated textiles on human health and the environment (particularly aquatic toxicity).

[3] See California Notice 2017-08, and Sample DPR Application.

[4] Even though the federal definition of “pesticide” includes products that claim to kill or repel pests and EPA has brought enforcement actions against companies that sold [unregistered] pesticide treated products that made pesticidal claims (e.g., North Face shoe settlement; WalkFit shoe insert settlement), there were, until recently, very few finished products made of pesticide impregnated materials registered with EPA. As in California, many companies registered pesticides used to treat textiles and/or bulk fibers and fabrics that were marketed as pest-resistant with EPA, but registration of finished products such as socks or shower curtains was less common. Accordingly, the California policy on pesticide impregnated materials creates an additional federal wrinkle by explicitly requiring that a finished product made of pesticide impregnated materials and including pesticidal claims be registered with EPA prior to being registered in California.

[5] See California Notice 2017-08 at p. 2.

[6] Id. at p. 3.

[7] Cal. Food & Agric. Code §§ 12841, 12843; 3 Cal. Code Regs. § 6388.

[8] Cal. Food & Agric. Code § 12841(f)(1)(D); 3 Cal. Code Regs. § 6386.

[9] Cal. Food & Agric. Code §§12406(a), 12847.

[10] Id. at§§ 12400, 12406(a), 12842.

[11] Id. at See also California Notice 2017-08 at p. 4.

[12] Cal. Food & Agric. Code §§12400; 12406.

[13] 40 C.F.R. § 152.25(a).

[14] See California Notice 2015-13 at p. 2.

[15] See http://www.cdpr.ca.gov/docs/mill/actions/fines.htm.

[16] See id. See also California DPR Progress Report 2015-2016 at p. 13, describing the enforcement actions and settlement agreements negotiated with companies selling unregistered pesticide products in the state, including “pesticide-infused products making pesticidal claims—like anti-microbial clothing, hardware and household items.”

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