[Federal Register Volume 65, Number 186 (Monday, September 25, 2000)]
[Proposed Rules]
[Pages 57577-57581]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-24553]


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DEPARTMENT OF JUSTICE

Drug Enforcement Administration

21 CFR Part 1310

[DEA Number 198P]
RIN 1117-AA57


Control of Red Phosphorus, White Phosphorus and Hypophosphorous 
Acid (and Its Salts) as List I Chemicals

AGENCY: Drug Enforcement Administration (DEA), Justice.

ACTION: Notice of Proposed Rulemaking.

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SUMMARY: The Comprehensive Drug Abuse Prevention and Control Act 
(hereinafter the ``Controlled Substances Act'' or ``CSA'') provides the 
Attorney General with the authority to specify by regulation, 
additional chemicals as ``List I'' chemicals if they are used in the 
manufacture of a controlled substance in violation of the CSA and are 
important to the manufacture of the controlled substance. Because of 
their use and importance in the illicit manufacture of methamphetamine, 
a Schedule II controlled substance, the DEA is proposing the addition 
of red phosphorus, white phosphorus (also known as yellow phosphorus) 
and hypophosphorous acid (and its salts) as List I chemicals.
    These phosphorus chemicals have been identified as being important 
chemicals for the illicit production of methamphetamine. As List I 
chemicals, handlers of these materials will be subject to CSA chemical 
regulatory controls including registration, recordkeeping, reporting, 
and import/export requirements. The Drug Enforcement Administration 
(DEA) has determined that these controls are necessary to prevent the 
diversion of these chemicals to clandestine drug laboratories.
    Given the small quantities and limited uses of these chemicals 
necessary for the production of methamphetamine, the DEA is proposing 
that no threshold be established for domestic and international 
transactions. As such, all transactions (regardless of size) shall be 
considered regulated transactions, subject to recordkeeping, reporting 
and/or import/export notification requirements.

DATES: Written comments must be submitted on or before November 24, 
2000.

ADDRESSES: Comments should be submitted in triplicate to the Deputy 
Administrator, Drug Enforcement Administration, Washington, DC 20537, 
Attention: DEA Federal Register Representative/CCR.

FOR FURTHER INFORMATION CONTACT: Frank L. Sapienza, Chief, Drug and 
Chemical Evaluation Section, Office of Diversion Control, Drug 
Enforcement Administration, Washington D.C. 20537 at (202) 307-7183.

SUPPLEMENTARY INFORMATION:

What Is the Purpose of This Notice?

    The Controlled Substances Act (CSA) and its implementing 
regulations, specifically 21 U.S.C. 802(34) and 21 CFR 1310.02 (c), 
provide the Attorney General with the authority to specify, by 
regulation, additional chemicals as ``List I'' chemicals if they are 
used in the manufacture of a controlled substance in violation of the 
CSA and are important to the manufacture of the controlled substance. 
This authority has been delegated to the Administrator of DEA by 28 CFR 
0.100 and redelegated to the Deputy Administrator under 28 CFR 0.104 
(Subpart R) Appendix Sec. 12.
    This notice proposes the addition of red phosphorus, white 
phosphorus (also known as yellow phosphorus) and hypophosphorous acid 
(and its salts) as List I chemicals. Additionally, this notice proposes 
that no threshold be established for domestic and international 
transactions.

What Specific Chemicals Does This Proposed Regulation Include? What 
Related Chemicals Will Not Be Subject to This Control Action?

    Phosphorus is a nonmetallic element that can occur in three main 
allotropic (i.e. crystalline) forms (white, red and black). Elemental 
phosphorus is derived from phosphate rock. The most abundant variety 
produced is white phosphorus (also known as yellow phosphorus). Most 
other forms of phosphorus and phosphorus chemicals are produced from 
white phosphorus. The white form is extremely flammable and toxic and 
must be stored and shipped in water.
    The second crystalline form is red phosphorus. Red phosphorus is 
usually prepared as a powder and is more stable and less toxic than the 
white form. A black crystalline form of phosphorus is also occasionally 
made and is similar to graphite in its physical, thermal and electrical 
properties.
    The DEA is proposing that the white and red forms of elemental 
phosphorus be designated as List I chemicals. Black phosphorus and 
phosphate rock will not be affected by this proposed action.
    Additionally, the DEA is proposing to designate hypophosphorous 
acid and its salts as List I chemicals. While hypophosphorous acid 
(H3PO2) is most commonly sold as 10%, 30% or 50% solutions, the DEA is 
proposing the control of all aqueous dilutions of hypophosphorous acid. 
Salts of hypophosphorous acid are known as hypophosphite salts. The DEA 
is also proposing that these salts be included as List I chemicals. 
Examples of these salts include: ammonium hypophosphite, calcium 
hypophosphite, iron hypophosphite, potassium hypophosphite, manganese 
hypophosphite, magnesium hypophosphite and sodium hypophosphite. Sodium 
hypophosphite is the most commercially available salt and is 
distributed in a white crystalline form.

[[Page 57578]]

What Is Phosphorus Used for and How Large Is the Industry?

    DEA's research indicates that there are currently only two domestic 
producers of elemental phosphorus. The primary material derived from 
phosphate rock is white phosphorus. Other forms of phosphorus and other 
phosphorus chemicals are manufactured from white phosphorus. DEA 
obtained 1998 and 1999 sales data from both producers. Over a two-year 
period, the two firms had only a few customers. Each customer appears 
to be a large industrial firm.
    The DEA reviewed independent data for 1997 indicating that 
approximately 250,000 metric tons of elemental phosphorus were consumed 
in the U.S. Most consumers are large entities, which primarily use 
elemental phosphorous in the manufacture of phosphorous chemicals not 
impacted by this proposed regulation.
    White phosphorus is primarily used to produce phosphoric acid and 
other phosphorus compounds including phosphorus trichloride and 
phosphorous pentasulfide and phosphorus pentoxide. Over 98% of the 
annual U.S. phosphorus demand is used in the production of these four 
compounds, none of which is subject to this proposed action.
    Industrial uses of red phosphorus include the manufacture of 
pyrotechnics, safety matches, phosphoric acid and other phosphorus 
compounds, fertilizers, incendiary shells, smoke bombs, tracer bullets, 
and pesticides. Very small volumes are used to produce ultra-high-
purity phosphorus semiconductor grades) for application in the 
electronics industry.
    Hypophosphorous acid is commonly used by large industry as a 
bleaching, color stabilization or decoloring agent for plastics, 
synthetic fibers (primarily polyester) and chemicals. It is also used 
in the preparation of hypophosphite salts, which are in turn used in 
synthetic fibers as wetting agents, dispersing agents, anti-static 
agents and emulsifying agents. Hypophosphorous acid is also used as a 
chemical intermediate in organic syntheses and as a polymerization and 
polycondensation catalyst. It also has applications as a reducing agent 
and as an antioxidant.
    The two most common salts of hypophosphorous acid are sodium 
hypophosphite and manganese hypophosphite. The sodium salt is used 
primarily in electroless nickel plating. It is also used as a reducing 
agent, analytical reagent, polymerization catalyst, polymer stabilizer, 
and fire retardant. While the manganese salt is used primarily in nylon 
fiber production, it also has application as a chemical intermediate. 
The DEA has identified two manufacturers of sodium hypophosphite in the 
United States.

Why Does the DEA Believe That Control of Red Phosphorus, White 
Phosphorus, and Hypophosphorous Acid (and Its Salts) Is Necessary?

    The DEA has identified these chemicals as being used in the illicit 
production of methamphetamine. The public health consequences of the 
manufacture, trafficking, and abuse of methamphetamine are well known 
and documented.
    These phosphorus chemicals play an important role in the chemical 
reaction to produce methamphetamine. A review of the 50 largest 
methamphetamine laboratories seized by DEA in 1998 was recently 
conducted. The study revealed that in those instances where the 
production method could be ascertained, red phosphorus was used in 87% 
of these laboratories. Additionally, a review of calendar years 1998-
1999 clandestine laboratory seizure data (reported by the El Paso 
Intelligence Center and the Western States Information Network) 
indicated that more than 3750 seized methamphetamine laboratories were 
confirmed as utilizing phosphorus.
    The majority of clandestine methamphetamine laboratories seized in 
the U.S. utilize phosphorus chemicals as catalysts to drive the 
chemical conversion of ephedrine or pseudoephedrine to methamphetamine. 
Since catalysts are necessary for the preferred method used by illicit 
laboratory operators, these phosphorus chemicals are important to the 
production of methamphetamine.
    While the vast majority of these laboratories utilized red 
phosphorus, DEA is aware that a number of seized laboratories have used 
white phosphorus. DEA believes that the use of white phosphorus is 
under-reported. Many forensic laboratories do not differentiate samples 
as being white versus red phosphorus. These analytical laboratories 
have historically identified seized material simply as `phosphorus'.
    The Idaho State Police, however, have closely monitored the illicit 
use of white phosphorus. Their information indicates that in 
southeastern Idaho, white phosphorus is frequently encountered in 
methamphetamine laboratories. From 1997 through the first quarter of 
2000, 86 methamphetamine laboratories were seized in this region of 
Idaho. White phosphorus was encountered at 35 of these laboratories; 
red phosphorus was encountered at 27 laboratories and the type of 
phosphorus was not identified at 24 of these laboratories.
    Recently the DEA has noted a small but increasing use of 
hypophosphorous acid at seized clandestine laboratories. During 1998, 
the DEA identified a total of only six methamphetamine laboratories 
utilizing hypophosphorous acid. In 1999, the DEA documented an 
additional 48 laboratories utilizing hypophosphorous acid. The trend 
continues into calendar year 2000.
    The DEA has also noted that detailed recipes describing the 
production of methamphetamine (using red phosphorus, white phosphorus 
and hypophosphorous acid) are being disseminated on the Internet. If 
red phosphorus alone is controlled, DEA has concluded that clandestine 
laboratory operators would rapidly move to white phosphorus and 
hypophosphorous acid. This would be an undesired consequence, since 
both the white phosphorus and hypophosphorous acid methods of illicit 
methamphetamine production are significantly more hazardous methods. 
White phosphorus is much more flammable and toxic than red phosphorus. 
If not stored in a solution, white phosphorus spontaneously combusts. 
The hypophosphorous acid method is also extremely hazardous since it 
produces phosphine gas. If not confined within the reaction vessel, 
ingestion of this poisonous gas can result in death. Therefore, use of 
these alternate methods poses increased hazards for both law 
enforcement and for the public.
    Based on analysis of chemistry and actual illicit use, DEA finds 
that these three chemicals are important to the manufacture of 
methamphetamine and therefore meet the definition of List I chemicals. 
Hence, this Notice proposes that these chemicals be subject to CSA 
regulatory controls for List I chemicals, including registration, 
recordkeeping, reporting, and import/export requirements as specified 
in 21 CFR parts 1309, 1310 and 1313. DEA believes that these regulatory 
controls are needed to prevent the diversion of these phosphorus 
chemicals to clandestine laboratories.

What Regulatory Controls Will Apply to These Chemicals?

    As List I chemicals, red phosphorus, white phosphorus, and 
hypophosphorous acid and its salts will become subject to the chemical 
regulatory control provisions and civil and criminal sanctions of the 
CSA. As such, recordkeeping, reporting and import/export notification 
requirements (as described in 21 U.S.C. 830 and 971

[[Page 57579]]

and 21 CFR parts 1310 and 1313) shall apply. Manufacturers, 
distributors, importers and exporters of white phosphorus, red 
phosphorus and hypophosphorous acid (and its salts) will be required to 
register with the DEA pursuant to 21 U.S.C. 822 and 823 and 21 CFR part 
1309.
    Handlers of these chemicals will also be required to maintain 
records and meet CSA import/export notification requirements for 
``regulated transactions'' of these chemicals. The CSA (21 U.S.C. 
802(39)) defines the term ``regulated transaction'' as a 
``distribution, receipt, sale, importation, or exportation of, or an 
international transaction involving the shipment of, a listed chemical, 
or if the Attorney General establishes a threshold amount for a 
specific listed chemical,'' a transaction involving a threshold 
amount''. The CSA, therefore, provides the Attorney General with 
authority to establish a threshold amount for ``listed chemicals'' if 
the Attorney General so elects.

Why Is No Threshold Being Established?

    As noted above, these chemicals are used as catalysts in the 
illicit synthesis of methamphetamine. Therefore, the manufacture of 
methamphetamine requires only small quantities of these chemicals.
    DEA has not been able to identify any household uses for red 
phosphorus, white phosphorus or hypophosphorous acid and its salts. 
However, these materials are being distributed in small quantities via 
Internet on-line auctions and through chemical supply houses directly 
to consumers. It is common to find 500 ml bottles of hypophosphorous 
acid or multi-ounce quantities of red phosphorus repackaged in 
unlabeled bags at seized laboratories.
    Therefore the DEA believes that all transactions should be 
regulated, regardless of size, to prevent the diversion of these 
phosphorus chemicals to clandestine laboratories. This notice proposes, 
therefore, that no threshold be established for domestic and 
international transactions.

What Steps Has the DEA Taken To Solicit Information From the 
Legitimate Phosphorus Industry?

    DEA recognizes that these chemicals have legitimate industrial uses 
and that regulation of these phosphorus chemicals may have some effect 
upon certain industries. Therefore, DEA has sought information on the 
phosphorus chemical trade so that diversion of these chemicals may be 
prevented with minimal impact on legitimate industry.
    Since red phosphorus was the phosphorus chemical most frequently 
encountered in clandestine methamphetamine laboratories, the DEA 
initially published an Advance Notice of Proposed Rulemaking on 
February 2, 2000 (65 FR 4913) to solicit input from potentially 
affected parties regarding: (1) The nature of the legitimate red 
phosphorus industry; (2) the legitimate uses of red phosphorus at all 
levels of distribution (including industrial uses and use by individual 
end-users at the retail level of distribution); (3) the potential 
burden such regulatory controls may have on legitimate industry 
(particularly with respect to the impact on small businesses); (4) the 
potential number of individuals/firms which may be adversely affected 
by increased regulatory requirements; and (5) any other information on 
the manner of manufacturing, distribution, consumption, storage, 
disposal, and uses of red phosphorus by industry and others. Both 
quantitative and qualitative data were invited.
    The DEA did not receive any comments or input from the phosphorus 
industry in response to this Notice. The DEA did receive six comments 
from law enforcement entities and two comments from Federal prosecutors 
in support of the control of red phosphorus as a listed chemical.
    Since laboratory seizure data sparked concerns over the illicit use 
of white phosphorus and hypophosphorous acid, the DEA broadened the 
scope of its research to include the entire phosphorus chemical 
industry. Since no industry input was received in response to the 
Advance Notice of Proposed Rulemaking, DEA directly contacted domestic 
producers of elemental phosphorus and importers of phosphorus 
chemicals.

What Portion of the Phosphorus Industry Is Potentially Impacted by 
This Regulation? Why Does DEA Believe That This Regulation Will Not 
Impose a Significant Burden on a Substantially Large Number of 
Firms?

    DEA has identified only two domestic producers of white phosphorus. 
While producers of white phosphorus will be required to register with 
DEA and maintain records of each regulated transaction (i.e. all 
transactions of these chemicals), over 98% of the phosphorus 
distributed by these two producers is eventually converted to a form 
not impacted by this proposed regulation. Handlers which acquire 
phosphorus and convert it to non-regulated forms will not be subject to 
CSA regulatory requirements.
    The remaining 2% of the phosphorus (used domestically) is utilized 
in its elemental form (i.e. as red phosphorus or white phosphorus) or 
used to produce all other phosphorus chemicals including sodium 
hypophosphite and hypophosphorous acid. Therefore, this proposed 
regulation will only affect the distribution of less than 2% of the 
industry at the end user level. It is believed that there are few firms 
handling these regulated forms (i.e. red phosphorus, white phosphorus 
and hypophosphorous acid and its salts.) Additionally, it appears that 
these chemicals have only industrial uses. The DEA has not been able to 
identify any `household' uses for red phosphorus, white phosphorus, or 
hypophosphorous acid (and its salts).
    In an effort to better estimate the potential impact of this 
proposed action, the DEA conducted an analysis of various data sources 
relating to the manufacture, distribution, and use of phosphorus, 
hypophosphorous acid, and the hypophosphites. This included an analysis 
of current chemical producers and marketing directories (to identify 
companies listing themselves as sources of these chemicals). In 
addition, Material Safety Data Sheets (MSDSs) were collected. Companies 
creating MSDSs for chemicals are likely to manufacture or distribute 
the chemicals.
    DEA also examined Environmental Protection Agency (EPA) reporting 
requirements pertaining to phosphorus, hypophosphorous acid, and the 
hypophosphites. Of the three chemicals subject to this proposed rule, 
only phosphorus is regulated under programs that require reporting to 
EPA. Phosphorus is covered by the Toxic Release Inventory (TRI) 
program, which requires an annual report to EPA listing the maximum 
quantity on site, the uses of the chemical, releases to the 
environment, and transfers offsite. The TRI data have the advantage 
that they provide information on the quantity of a chemical transferred 
offsite as a waste, and the name of the offsite treatment facility. The 
last element is important because, while there are few manufacturers of 
the chemical, there are users who may come under the proposed 
regulations because they distribute the chemical to waste treatment 
facilities.
    Phosphorus is also subject to Department of Transportation (DOT) 
hazardous material (``hazmat'') regulations so that interstate and 
intrastate transportation require shipping papers. Additionally, 
hypophosphorous acid is covered in interstate commerce. The MSDSs 
located for the hypophosphites indicate

[[Page 57580]]

that they are not covered by the DOT hazmat rules.
    The analysis concluded that there are only two bulk manufacturers 
of phosphorus, most of whose product is sold to chemical manufacturers 
or exported. A limited number of other facilities manufacture 
phosphorus as a by-product or import phosphorus. The hypophosphites are 
similarly produced by very few facilities. The analysis identified two 
main producers of the hypophosphites. Additionally, two producers of 
hypophosphorous acid were identified. One of the two producers recently 
acquired the other. Therefore, only five manufacturers are likely to be 
affected by this proposed regulation.
    A review of chemical marketing directories identified at least 39 
companies, other than the manufacturers, that claim to sell these 
substances.
    In 1998, 53 facilities reported to EPA for phosphorus. Most of 
these companies would not be required to register with DEA unless they 
sell phosphorus or transfer it offsite. Twenty-one of the 53 facilities 
reporting phosphorus under TRI sent phosphorus offsite to 30 separate 
places for treatment as waste. Many of the transfers were for recovery 
or recycling and a few were for disposal in landfills. A few reported 
releasing the substance to publicly owned treatment works (i.e., 
wastewater treatment).
    This waste material would likely be considered a chemical mixture 
containing phosphorus. While chemical mixtures are currently exempt 
from CSA chemical regulatory requirements, the DEA is preparing 
regulations pertaining to such mixtures.
    This proposed regulation is not considered to have an impact upon a 
substantial number of firms, given the limited distribution of these 
three chemicals. Additionally, it is likely that the CSA recordkeeping 
requirements are already being met as part of normal business practice. 
For phosphorus, compliance with EPA and DOT regulations should document 
distributions to customers and offsite waste transfers. Hypophosphorous 
acid shipments should be documented, but shipments of the 
hypophosphites may not be. Nonetheless, it is likely that chemical 
distributors do maintain records of shipments and customers even if 
shipping papers are not required.

How Many Importers and Exporters Are Potentially Affected?

    According to 1999 maritime data (as reported by the Pier Import 
Export Reporting Service), imports of phosphorus chemicals into the 
U.S. totaled 101 shipments for a total of 2,500 metric tons to 36 
different firms. U.S. exports totaled approximately 180 shipments of 
4,300 metric tons by 32 firms.
    Prior to preparing this proposal the DEA also solicited information 
directly from importers. This data indicated that most all the material 
appeared to be for large industrial uses.

As Part of This Proposed Rulemaking, the DEA Again Invites Input 
Regarding the Legitimate Uses for These Chemicals

    This notice solicits input regarding: (1) The nature of the 
legitimate phosphorus industry; (2) the legitimate uses of phosphorus 
at all levels of distribution (including industrial uses and use by 
individual end-users at the retail level of distribution); (3) the 
potential impact such regulatory controls may have on legitimate 
industry (particularly with respect to the impact on small businesses); 
(4) the potential number of individuals/firms which may be affected by 
increased regulatory requirements; and (5) any other information on the 
manner of manufacturing, distribution, consumption, storage, disposal, 
and uses of phosphorus by industry and others. Comments must be 
submitted on or before November 24, 2000.
    The Deputy Administrator hereby certifies that this rulemaking has 
been drafted in a manner consistent with the principles of the 
Regulatory Flexibility Act (5 U.S.C. 601 et seq.). It will not have a 
significant economic impact on a substantial number of small business 
entities.
    The Deputy Administrator further certifies that this rulemaking has 
been drafted in accordance with the principles in Executive Order 12866 
section 1(b). DEA has determined that this is not a significant 
rulemaking action. Therefore, this action has not been reviewed by the 
Office of Management and Budget.
    This regulation meets the applicable standards set forth in 
Sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice 
Reform.
    This action has been analyzed in accordance with the principles and 
criteria in Executive Order 13132, and it has been determined that this 
rule does not have sufficient federalism implications to warrant the 
preparation of a Federalism Assessment.
    This rule will not result in the expenditure by state, local, and 
tribal governments, in the aggregate, or by the private sector, of 
$100,000,000 or more in any one year, and will not significantly or 
uniquely affect small governments. Therefore, no actions were deemed 
necessary under the provisions of the Unfunded Mandates Reform Act of 
1995.
    This rule is not a major rule as defined by Section 804 of the 
Small Business Regulatory Enforcement Fairness Act of 1996. This rule 
will not result in an annual effect on the economy of $100,000,000 or 
more; a major increase in costs or prices; or significant adverse 
effects on competition, employment, investment, productivity, 
innovation, or on the ability of United States-based companies to 
compete with foreign-based companies in domestic and export markets.
    The Drug Enforcement Administration makes every effort to write 
clearly. If you have suggestions as to how to improve the clarity of 
this regulation, call or write Patricia M. Good, Chief, Liaison and 
Policy Section, Office of Diversion Control, Drug Enforcement 
Administration, Washington, DC 20537, telephone (202) 307-7297.

List of Subjects in 21 CFR Part 1310

    Drug Traffic Control, Reporting and Recordkeeping Requirements.

    For reasons set out above, it is proposed that 21 CFR Part 1310 be 
amended as follows:

PART 1310--[AMENDED]

    1. The authority citation for part 1310 continues to read as 
follows:

    Authority: 21 U.S.C. 802, 830, 871(b).

    2. Section 1310.02 is proposed to be amended by adding a new 
paragraph (a)(25) through (27) to read as follows:


Sec. 1310.02  Substances covered.

* * * * *

    (a) * * *
    (25) Red phosphorus--6795
    (26) White phosphorus (Other names: Yellow Phosphorus)--6796
    (27) Hypophosphorous acid and its salts (Including ammonium 
hypophosphite, calcium hypophosphite, iron hypophosphite, potassium 
hypophosphite, manganese hypophosphite, magnesium hypophosphite and 
sodium hypophosphite)--6797

    3. Section 1310.04 is proposed to be amended by adding new 
paragraphs (g)(1)(ii) to (g)(1)(iv) to read as follows:


Sec. 1310.04  Maintenance of Records.

* * * * *
    (g) * * *
    (1) * * *
    (ii) Red phosphorus
    (iii) White phosphorus (Other names: Yellow Phosphorus)

[[Page 57581]]

    (iv) Hypophosphorous acid and its salts
* * * * *

    Dated: August 30, 2000.
Julio F. Mercado,
Deputy Administrator.
[FR Doc. 00-24553 Filed 9-22-00; 8:45 am]
BILLING CODE 4410-09-P