[Federal Register Volume 64, Number 205 (Monday, October 25, 1999)]
[Proposed Rules]
[Pages 57421-57424]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-27798]


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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

[[Page 57422]]

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

[[Page 57423]]

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

[[Page 57424]]

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]
BILLING CODE 6560-50-P