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Vol. 140, No. 23 — November 15, 2006
Registration
PEST CONTROL PRODUCTS ACT Pest Control Products Sales and Information Reporting Regulations P.C. 2006-1137 October 26, 2006 Her Excellency the Governor General in Council, on the recommendation of the Minister of Health, pursuant to subsection 67(1) of the Pest Control Products Act (see footnote a), hereby makes the annexed Pest Control Products Sales Information Reporting Regulations.
REGULATORY IMPACT ANALYSIS STATEMENT (This statement is not part of the Regulations.) Description Pest control products (pesticides) are regulated in Canada under the federal Pest Control Products Act (PCPA). Health Canada's Pest Management Regulatory Agency (PMRA) administers the PCPA and the Pest Control Products Regulations (PCPR) on behalf of the Minister of Health. A new PCPA was brought into force with the PCPR on June 28, 2006. Under the PCPA, pesticides must be registered by the Minister of Health before they can be used in Canada. A pesticide may not be registered or may not continue to be registered unless its health and environmental risks and its value have been determined to be acceptable by the Minister. Under the PCPA (subsection 8(5)), registrants, a company in whose name a pesticide is registered, and applicants for the registration of a pesticide, are now required to report prescribed information (such as sales) about their pesticides. Reporting requirements The Pest Control Products Sales Information Reporting Regulations (SIRR) require registrants of pesticides to submit an annual report to the Minister indicating the quantity of each of their registered products, including emergency or conditional registrations, that was made available for sale to users in each province and territory during the previous calendar year. Registrants of end-use products, active ingredients and manufacturing concentrates that sell to manufacturers of fertilizer-pesticide or feed-pesticide combination products or of treated seeds are also required to submit an annual report. A registrant who does not have access to the actual information on quantities made available for sale to users in each province and territory by regional and national distributors or in the form of fertilizer-pesticide and feed-pesticide combination products and treated seeds may provide an estimate of those quantities if a satisfactory explanation of how the estimate was derived is provided. For verification and auditing purposes, registrants are required to maintain original records and supporting data, in relation to the sales information submitted, for six years from the date the information was submitted to the Minister, and to submit those records to the Minister upon request. The annual report for a calendar year is required to be submitted by the first day of June of the following year, beginning with the first full calendar year after these Regulations are brought into force. The Regulations also require registrants to provide available sales data within 15 days of a request from the Minister for the purpose of responding to a situation that endangers human health or safety or the environment or if needed in order to make a regulatory decision. Disclosure of information Under the PCPA, the Minister must establish a Register of Pest Control Products containing extensive information about pesticides, including sales information provided by registrants to the Minister pursuant to subsection 8(5). The public does not have access to any information in the Register that is recognized by the Act as confidential business information (CBI). The definition of CBI in the PCPA includes the monetary value of sales of pesticides. Provisions to prevent the inadvertent disclosure of CBI are discussed under "Consultation" (Disclosure of Pesticide Sales Information). The SIRR are very similar to the proposal that was pre-published for comment in the Canada Gazette, Part I, on March 27, 2004. In response to comments received, the SIRR have been modified from the proposal in order to enhance efficiency and cost-effectiveness. Alternatives As stated in subsection 8(5) of the PCPA, reporting of sales information is a condition of pesticide registration. The collection of sales data cannot take place until the information to be reported and time frames for reporting are prescribed by regulation. In its May 2000 report the Standing Committee on Environment and Sustainable Development recommended that, as a condition of registration, registrants be required to provide PMRA with their sales data on an ongoing basis. In its response, the federal government endorsed the principles set out in the Standing Committee report. In 2002, the Commissioner of the Environment and Sustainable Development criticized PMRA for not acting on the Government's 1994 commitment and, in her 2003 report, recommended that PMRA accelerate and promptly complete the implementation of the sales database. The national pesticide sales database could not be implemented until the PCPA and required Regulations were in force. Benefits and Costs Benefits The Minister of Health's mandate under the PCPA is to prevent unacceptable risks to people and the environment from the use of pesticides. It is important that PMRA has access to timely post-registration information related to pesticides in order to ensure that the risks of registered pesticides continue to be acceptable. These risks are determined by evaluating both the hazard posed by the pesticide and the extent to which people and the environment are exposed. Thus, in order to regulate pesticides appropriately and efficiently, there is a need for comprehensive information about the extent to which pesticides are sold and used once they are registered. Internationally, the importance of sales data reporting has been recognized by the Working Group on Pesticides of the Organization for Economic Co-operation and Development (OECD). Member countries agree that data on pesticide use are fundamental to target and track risk reduction programs and to develop pesticide risk indicators, but recognize that the collection of use data is expensive (see "Costs to government"). Most OECD countries collect sales data as a reasonable surrogate for use information. In addition, the International Code of Conduct on the Distribution and Use of Pesticides of the Food and Agriculture Organization of the United Nations, which was developed through the joint effort of government experts, non-governmental organizations, the pesticide industry and other United Nations organizations, recommends that the pesticide industry provides to national governments clear and concise data on sales and quantity of pesticides. In many countries, the collection of sales data is complemented by the collection of use data. For example, in the United States (U.S.), the Environmental Protection Agency (EPA) collects sales, production and distribution information from pesticide registrants, as well as non-agricultural pesticide use data through special surveys conducted by contractors, while the Department of Agriculture collects agricultural pesticide use data. In addition, many states collect detailed data on pesticide use, such as California whose Pesticide Use Reporting System has been described as the most comprehensive in the world. The U.S. National Center for Food and Agricultural Policy combines information collected by the EPA with information from state reports, special surveys and expert opinions to produce a comprehensive database of pesticide use in agricultural production for some 200 active ingredients used on 87 crops in the 48 contiguous states. Reporting of pesticide sales information is a critical piece of an integrated system for obtaining comprehensive information on the extent of pesticide use in Canada and of particular interest to provincial and territorial regulators. The combination of sales information obtained from the registrants and use information garnered by the provinces and territories will result in a clearer and more comprehensive picture of pesticide use in Canada. The information will also support PMRA, and the provinces and territories, in setting priorities, following trends of pesticide sales over time, developing pesticide risk indicators and documenting risk reduction trends. Accurate sales information will also ensure the provision of best available and consistent information for use in regional, national and international activities on hazardous chemicals. The Regulations are an integral part of implementing the strengthened health and environmental protection, increased transparency and sustainable pest management supported by the PCPA legislation. It was also determined through a strategic environmental assessment that this regulatory initiative may result in positive environmental impacts. Costs to industry The costs to registrants are expected to be minimal since it is likely that the required information is already maintained during the normal course of business. Registrants of about half of the registered pesticides provided similar information in the 1980's and early 1990's through the Pesticide Registrant Survey (see footnote 1) carried out periodically by Environment Canada and Agriculture and Agri-Food Canada. In addition, some registrants voluntarily provided sales information for the years 1999 and 2000 to PMRA, in many instances providing the information by province and territory. Registrants will be required to have access to a computer and the Internet and may incur modest costs to prepare the data in the specified format and to submit the data to PMRA. The latter costs will be proportional to the number of registered pesticides and the number of provinces and territories in which they are sold. In 2002, a registrant with approximately 30 products was involved in testing a prototype electronic data entry system and estimated that it would take 1 to 1.5 person-days per year to complete the data entry for those products. PMRA regulates approximately 715 registrants selling more than 5,400 pesticides. The foregoing does not take into account the cost of estimating the quantities of pesticides made available for sale to users in each province and territory by regional and national distributors or in the form of fertilizer-pesticide and feed-pesticide combinations and treated seeds. In their comments on the Part I publication, pesticide registrants asserted that the cost of providing the quantity of pesticide sales by province and territory would be between 0.16 percent and 3 percent of total annual sales, i.e., $2 million to $39 million per year. However, this cost estimate was based on the incorrect assumption that all retail sales to users would have to be tracked. The revised Regulations require registrants to report the quantities provided for sale directly to users, vendors and distributors in each province and territory, and the total of the quantities provided to manufacturers of combination products and treated seeds in Canada, which simplifies the requirements to the extent possible to increase feasibility. The quantity "made available for sale to users" is the quantity in the hands of vendors, not the quantity sold by vendors to users. Environment Canada and PMRA have made arrangements to ensure that pesticide information collected under these Regulations will not be collected in duplicate under Environment Canada's National Pollution Release Inventory. PMRA will be able to share information with Environment Canada as required to support their requirements. This arrangement will minimize the regulatory burden on registrants. Costs to government The costs to government will be for an electronic data entry system and the database tables to capture and use the sales information and for ongoing activities to maintain and provide reports on the information. In 2004, it was estimated that the development of the sales reporting module would cost approximately $100,000, significantly less than would be required to collect information on pesticide use. For example, it has been estimated that it would cost several hundred thousand dollars annually to purchase all of the proprietary pesticide usage data in Canada and this still would not cover all of the uses of pesticides in Canada. Ongoing maintenance and reporting activities will be accomplished within existing resources. Conclusion The significant benefits of collecting sales information in enhancing the Government's ability to monitor pesticide sales trends, clearly outweigh the costs to industry and Government of implementing the Regulations. Evaluation The design and continued relevance and cost-effectiveness of the SIRR will be evaluated periodically. Annual reports will be made to the Parliament as required under the PCPA. Consultation These Regulations have been developed after several years of discussions with the Federal-Provincial-Territorial Committee on Pest Management and Pesticides (FPT Committee) and its Working Group on the National Pesticide Sales Database. The Working Group includes representatives from the two major pesticide industry associations (CropLife Canada and Canadian Consumer Specialty Products Association), provincial members of the FPT Committee (Alberta Environmental Protection, Québec Ministry of Environment and Ontario Ministry of Agriculture, Food & Rural Affairs), growers (Canadian Federation of Agriculture and Canola Council of Canada) and consumer and environmental non-governmental organizations (Consumers' Association of Canada and World Wildlife Fund). Both the FPT Committee and the Working Group support the development of a single national pesticide sales database. In May 2003, PMRA published a Discussion Document titled Preliminary Consultation on Proposed Sales Reporting Regulation on PMRA Web site and distributed it to members of the Pest Management Advisory Council (PMAC), the FPT Committee, the Economic Management Advisory Committee (EMAC), the North American Free Trade Agreement (NAFTA) Technical Working Group on Pesticides and colleagues in Health Canada and other federal departments. The proposed Pest Control Products Sales Information Reporting Regulations were pre-published in the Canada Gazette, Part I, in March 2004 for a 75-day comment period. Comments were received from 13 respondents, comprising industry associations, registrants and environmental non-governmental organizations. The proposal was also discussed at a meeting of PMAC in May 2004. In their comments on the Part I publication, industry associations, registrants and environmental non-governmental organizations reiterated their general support for the collection of pesticide sales information in Canada. The issues raised in response to the Part I publication, as well as changes made to the proposed Regulations, are summarized below. Use of Estimates Providing estimates of the provincial/territorial sales when actual information is unavailable has received the support of the pesticide industry and other members of the FPT Working Group. Industry associations and registrants emphasized that obtaining pesticide sales information by province and territory when products are sold through regional or national distributors is difficult and pointed out that other OECD countries do not collect such detailed information nor does the Canadian government with respect to other marketed products. These respondents indicated that many distributors keep information on their sales and distribution patterns confidential. As a result, some respondents questioned their ability to certify that information submitted to PMRA was true and complete. Some respondents asserted that registrants or distributors may withdraw products from the Canadian market if they were compelled by regulation to obtain or disclose such information, respectively. Environmental non-governmental organizations supported the collection of sales information by province and territory because it facilitates tracking trends in sales, patterns, risk, etc., on a regional basis. These respondents agreed that estimates were necessary in certain circumstances but emphasized that estimated data should not be mixed with accurate data. The Regulations were revised to permit the use of estimates indefinitely rather than only for the first five years as was initially proposed. Elements of the reporting requirements that can be determined precisely are reported separately from elements that may be estimated. Any reports and analyses based on sales information will acknowledge and take into account that some data are estimated. If it is deemed necessary, the regulation, in consultation with the public, may be revised in the future to specify an acceptable methodology of estimating sales data. Combination products and treated seeds Industry associations and registrants commented on the Part I publication stating that it would be difficult and costly to determine the distribution of combination products and treated seeds made from their registered pesticides, especially since the manufacturers of these products may purchase the same pesticide from more than one registrant. Environmental non-governmental organizations pointed out that, without these data, a significant amount of pesticide usage would not be included and agreed that estimates were necessary in certain circumstances. To address the comments, the Regulations were revised such that registrants are required to report only the total of the quantities provided to manufacturers of these products in Canada. The use of estimates is permitted indefinitely regarding the quantities made available for sale to users in each province and territory in the form of combination products and treated seeds. If it is deemed necessary, the regulation, in consultation with the public, may be revised in the future to specify an acceptable methodology of estimating sales data. Categories of pesticide sales data Environmental non-governmental organizations suggested that the Regulations be revised to require separate reporting and tracking of sales information for minor use products, formulants of toxicological significance and microcontaminants that are persistent organic pollutants (POPs). They are concerned about active ingredients that are first registered for "minor" uses but whose registered uses expand over time to the point that they should be considered "major" use products. They contend that information on formulants would facilitate more accurate tracking of risk and environmental and epidemiological research, and point out that making an inventory of POPs microcontaminants is a requirement of the Stockholm Convention. No changes were made to the Regulations in response to this comment. It will be possible to determine the quantity made available for sale to users in each province and territory for individual active ingredients and other pesticide components using the information on file with PMRA regarding product composition, along with information that is submitted pursuant to the Regulations. With regard to minor use products, PMRA evaluates the aggregate risk of all existing and proposed new uses whenever an application to expand the registered uses of an active ingredient is received. The use expansion is not approved unless the total health and environmental risks are determined to be acceptable. Time period for annual reports In comments on the Part I publication, one registrant suggested that the time period for annual reports be based on each registrant's fiscal year in order to ensure that returns and stock movements are complete and records are available. This change was not made because tracking of trends would be very difficult if each registrant's report were based on a different time period. Initial report The proposed Regulations pre-published in the Canada Gazette, Part I included a requirement for registrants to report available sales information that they may have compiled in the calendar year before the coming into force of the Regulations. The Regulations were revised to delete the requirement for an initial report. The available information would likely have been incomplete and potentially misleading since registrants could not have been compelled to compile information retroactively. It was, therefore, concluded that there would be no advantage to obtaining this information nor to making it available to the public and that reporting will start only once the SIRR come into force. The first sale reports are due by June 1 following the first calendar year after which the SIRR come into force. Retention of records One industry association suggested that records should be permitted to be retained electronically rather than in hard copy. This would be permissible as the Regulations do not specify the form in which the records must be retained. Reporting available information on request In comments on the Part I pre-publication, environmental non-government organizations suggested that the response time be reduced to seven days. This change was not made since companies will require up to 15 days to gather accurate information. The environmental non-government organizations also suggested that available information reported on request in an emergency situation be subject to audit if the Minister believes that the information is not accurate or complete. This change was not made. In these cases, the registrant is only required to provide information that is available at the time of the request and it would not be cost-effective to attempt to audit such information. Nevertheless, the registrant must attach the certification that the report is true and complete to the best of the person's knowledge and belief and that it is provided in good faith. Sales versus use information In comments on the Part I publication and in previous comments, environmental non-governmental organizations supported the collection of sales data as a necessary first step but emphasized that pesticide sales are an inadequate surrogate for pesticide use. These respondents cited a number of ways site-specific use data would be useful, noted that the PCPA provides authority for the collection of pesticide use data and described the California Pesticide Use Reporting System as an example of a successful use data collection system. They suggested that the Regulations be revised to require collection of and reporting on pesticide use data for the calendar year 2008. They also provided a model regulation for collection of pesticide use data based on regulatory models in other jurisdictions. Industry associations and registrants expressed their strongly held view that the use of sales data to represent exposure is both misleading and inaccurate. These respondents emphasized that sales data should not be used in any risk assessments, nor as an indication of risk reduction. It is recognized that sales and not use information is being collected. However, it is also recognized that there is necessarily a very strong correlation between the amount of a pesticide sold and the amount used. As was noted previously, OECD countries have agreed that the collection of use data is expensive and, as a result, most collect sales information as a surrogate for use information. Once the sales database has been established, its effectiveness will be evaluated. Targeted use surveys could be conducted as necessary to supplement or confirm the sales information. However, it would be premature to make regulations under the PCPA to collect pesticide use data until developments at the provincial level are clear. Disclosure of pesticide sales information In comments on the Part I pre-publication and in previous comments, industry associations and registrants expressed concern about the public disclosure of sales information both because the information could be used to calculate the monetary value of sales and because the information could create an erroneous perception about the extent of pesticide use. These respondents were particularly concerned about cases of active ingredients that are found in three or fewer end-use products and suggested that sales information be rolled up into groups of chemical families before being disclosed. They also requested that report templates and parameters, and active ingredient groupings, be discussed with industry before implementation and that registrants be allowed to review reports prior to public release. Environmental non-governmental organizations agreed that sales information could be rolled up into groups of chemical families but expressed concern that inappropriate groupings could lead to an unnecessarily high number of active ingredients for which individual sales information would not be publicly available. These respondents suggested that a methodology be developed to aggregate end-use product data where there are only a few registrants per active ingredient. They further stipulated that the methodology should ensure that no more than 2.5 percent of end-use products are aggregated and should be statistically valid. PMRA must ensure that the public is allowed access to information in the Register, such as sales information, while at the same time preventing the monetary value of sales from being disclosed. PMRA intends to roll up the sales information for end-use products containing active ingredients found in three or fewer products into groups of products before it is placed in the Register and thereby subject to public disclosure. To address the concern regarding the possibility of erroneous public perceptions about the extent of pesticide use, PMRA will ensure that publicly released reports on pesticide sales clearly state that the figures represent quantities "made available for sale to users" only. PMRA will discuss report templates and parameters, and active ingredient groupings, with stakeholders before implementation. Once this is done, it should not be necessary for registrants to review each report prior to release. One industry association and two registrants also expressed concern about the possible disclosure of sales information for active ingredients and manufacturing concentrates that are used to manufacture end-use products. As well, these respondents expressed concern about sharing individual product sales information with other regulators or medical professionals and suggested that any disclosure to these parties should be fully justified and agreed to by the affected registrant and that disclosure should be limited to legitimate and relevant regulatory agencies only. With regard to sharing individual product sales information with others, the PCPA specifies to whom and under what circumstances confidential information may be disclosed in confidence, such as to respond to a situation that endangers human health or safety or the environment or to make a medical diagnosis. Before confidential information is disclosed to provincial regulators or regulators in other countries, there must be an agreement in place and the Minister must be satisfied that the other party can provide protection from unfair commercial use or disclosure of the information. The PCPA prohibits the disclosure of confidential information obtained in this way and use of the information for any purpose other than the purpose for which it was obtained. Any person who contravenes these prohibitions is liable to severe punishment. Compliance and Enforcement The PMRA promotes, maintains and enforces compliance with the PCPA through compliance promotion programs, inspections, both monitoring and surveillance, and investigations. The programs aim to educate, facilitate and promote compliance as well as to communicate regulatory information. Monitoring inspections are designed to determine the level of compliance of users, distributors and registrants of pesticides with specific terms and conditions of registration and re-evaluation and the provisions of the PCPA and regulations. Enforcement response actions may include education (written and oral), administrative monetary penalties or warning under the Agriculture and Agri-Food Administrative Monetary Penalties Act (AMPA) and prosecutions under the PCPA. The goal of any enforcement response is to achieve and maintain compliance. Since the majority of the regulated community will comply with the law if they understand it and have the capacity to comply, many violations are dealt with and corrected using education as a means to address non-compliance situations and behaviour. In general, compliance with the PCPA and regulations is achieved through a network of officers and inspectors across Canada. Health Canada regional staff also have formal agreements providing a basis to collaborate with provincial pesticide regulatory officials in investigations and in the development and delivery of programs. The PMRA will follow an established compliance policy to promote and enhance fair treatment of the regulated community. The document is available on the PMRA website at http://www.pmra-arla.gc.ca. Contact
Francine Brunet
S.C. 2002, c. 28 The Survey was discontinued in favour of the proposed regulations under the PCPA |
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