>> Joseph Mohorovic: Thank you.
It's a pleasure to be here.
And I'll say it's a pleasure to be here again
with you because I'm not Johnny-come-lately
when it comes to this organization
and this group.
I'll tell you standing here I'm amazed
to see how much the group has grown.
I was with you in New Orleans.
I was with you in Chicago.
And I have seen first hand how this
industry and especially with the leadership
from the association, has come together to
tackle what I admit is a very challenging period
of time for the industry with CPSIA.
All of the new requirements that hit
kind of all at once but it's really --
it's something to be very, very proud of.
I'm glad to be here for that reason
because I've experienced it with you.
So it's just -- it's doubly
pleasurable for me to be here.
I want to also thank, of course,
Tom Goos and Mary Jo Tomasini.
Paul Bellantone, thank you for that kind
introduction and for your leadership
and inviting me to be here today.
And of course, Anne Stone as well.
This is a remarkable event and
I'm proud to be a part of it.
Now I know my good friend and
colleague Commissioner Bob Adler got
to give a fun talk yesterday.
He's an ex-professor, he doesn't have to
worry about getting to the boring stuff
or complaints or any of the bad news.
He's terrific and he's terrific to work with.
And you know, I think I'll give you a sense
of perspective about that right now too.
Because I know it's hard to say you're in
Washington, I guess, as a Commissioner --
I'm telling you the truth, I promise.
It's not like my lips are moving
and you can tell I'm lying.
We really do get along as the CPSC.
The five commissioners -- and
this has been a cultural dynamic
that really was a priority
for our Chairman Elliot Kaye.
He wanted to -- he wanted
to really take advantage
of the different -- the diversities
of perspectives.
He wanted to take care of
the diversities of opinions.
And really have a collegial body
that works together as opposed to --
you know, trying to find ways to --
you know, shoot BB guns at each
other from across the dais.
And that healthy, productive working
relationship I think is something
that the American taxpayer should expect.
You're getting in from your CPSC.
And something else that I wasn't planning on
leaning with but I'll tell you another element
of pride for me as a commissioner
of the CPSC is to learn generally --
generally speaking how well our agency has done
in terms of being externally engaged with you.
With the association, individually,
collectively,
the extent to which we're participating.
We understand you're coming to the table
to learn more about your responsibilities.
You have very practical questions.
Many of these questions CPSC staff
have not conceived of in advance,
but I understand that we're generally
very pleased that the association
and its membership is very
pleased with the extent
to which CPSC has been externally engaged.
And I know Neal Cohen, who's been
a huge part of that for many years
until he rode off into the sunset in March.
Where's Neal?
Is he still here today?
There he is, he's killing if over there.
Let's give a round of applause to Neal again.
[ Applause ]
Yes, Neal really was -- was really just
represented that some of the best in terms
of external engagement and
practical advice for companies.
I'm glad he's still here doing that today.
But as apposed to Bob doing some fun
stuff, I do have to talk about compliance.
I have to talk about compliance -- it's not
going to be the necessarily the bad news --
the news and gloom -- but you're here to learn
about from your regulators
-- what are the expectations?
And hopefully I can provide
some practical advice.
So I'd like to also provide today some of
the resources that I think are quite helpful.
CPSC, you know we are a law enforcement agency.
I'm a law enforcement official
complete with a badge.
Really, I'm not kidding.
I really have a badge.
This is not a promotional product.
[ Audience Laughing ]
Stop laughing!
I'm being serious!
I'm a regulator.
It is -- they gave me a real badge.
And I got the number 31 on it,
which apparently in law enforcement
if you have a low badge number it's
like especially, a special good treat.
Although they've already warned me
that I can't keep it afterwards,
so I'll be turning that in in no time.
But look, we are -- we are
a law enforcement agency.
We're a health and safety --
health and safety regulator.
Compliance -- it is complex.
I know it's complex too.
I had a hard time understanding
CPSIA coming right out of the gate
and that was just once removed from the agency.
And in the testing community, I know we've got
fantastic reputable members of that industry
that I was proud to be a part of are here
serving you today and are here in the room too
and presenting with some booths outside.
But while compliance is complex, it's achievable
because the helpful tools are available.
And most importantly compliance
is worth achieving
because unsafe products harm not just consumers
but your brands and your businesses as well.
You know, our jurisdiction reads 16,000 consumer
products and of course that includes many
of the products that you make and sell.
And among those products many touch on potential
hazards that are of high concern to the CPSC.
As an example, let's play out
that scene from "The Graduate."
Remember Dustin Hoffman and "The Graduate"
and he's nervous, he's clearly overwhelmed
at the beginning of the film and his parents are
throwing him a graduation party and you know,
the friend of the family, guy kind of
puts his arm on his shoulder, he says,
"I want to say one word to
you," What was the word?
>> [Audience] Plastics.
>> Plastics, right.
Plastics. We're concerned about plastics.
You've got it on the tip of your tongue,
they show up in countless products.
More than a few toys, of course, or other
children's products and that can get you
into some of the CPSC's diciest waters.
Doesn't mean you can't navigate
them, but they get a little dicey.
We're concerned about plastics,
which means you should too.
I know you are by that response.
You know, because we're concerned with some of
the chemicals that might show up in plastics
like phthalates and heavy metals such as lead.
Problems with lead created the
famous year of the recall in 2007.
And it spurred Congress to pass
the sweeping reform legislation
in 2008, well we all know CPSIA.
It imposed strict requirements for heavy
metals, and phthalates, other chemicals.
Requirements CPSC has to -- we
have to enforce them strictly.
That's our responsibility.
That's why we're in this job.
But plastics aren't the only
intersection of CPSC and PPAI.
In children's products including toys
we have concerns about small parts.
In textiles we worry about
chemicals, flammability's,
drawstrings for kids, and
anything with a battery.
I know you're probably sick to death
of hearing about batteries so far.
I've got my -- well I won't tell you --
I won't talk about the phone
that's in my pocket right now.
But don't worry it's safe.
It's a hot topic these days.
It's a hot topic at CPSC.
That's literally true for lithium ion batteries.
And I know you're getting the
kind of information to help insure
that you never have an issue of concern
with any product that you might source
or that you might pick up from
a supplier as a distributor.
But they've been catching
fire at alarming rates.
We know it's real.
And also don't sleep on the
button -- don't literally sleep --
but don't forget about the
button cell batteries as well.
They've showed up with some
horrific injuries and cases
when kids have access to
them and they swallow them.
So it's not just lithium ion and going
to fire, also button cell is a concern
that I hope you're keeping in mind and insuring
that you don't have button
cell batteries being released.
But there are lots of opportunities for
promotional products companies to run a file
of the CPSC and nobody wants that.
The way to avoid it is to make
sure you understand the CPSC's role
in product safety and your
role in product safety.
Specifically, I think what would
be helpful is I'm going to talk
about what your responsibilities are, what
the consequences of the agency can impose
for failure to meet some
of those responsibilities,
and hopefully helpfully what tools exist
to help you meet your obligations
and manufacture safe products.
And of course I'll be willing to
answer any and all questions you have
at the end of my prepared remarks.
So first, what are you responsibilities
for CPSC compliance?
Well, we write product safety rules
under seven different statutes.
You don't have to try and memorize those.
But these are the rules that define attributes
of a product that make it safe or unsafe.
So with CPSAI in 2008, Congress added
a testing and certification system
for products subject to mandatory rules.
And I'm sure most of you, if not
all of you are familiar with that.
But you also know that now you
have a big paperwork burden.
You have to pledge on a document
-- it's really a pledge.
It's not so much a certificate like
when you see certified products.
I know we've got proud representatives
from UL as they list products --
and that's third party certified.
This certificate obligation is your pledge
that the product is fully compliant.
And it demonstrates a knowledge on that
certificate of what the mandatory rules, bands,
regulation, standards, that are
applicable to those products.
Now you already had a legal
obligation to distribute safe products.
But now you have a legal obligation to
pledge that those products are safe.
Because it's not enough just to get lucky.
It's really not.
And that's what the certificate
obligation is trying to impose.
It needs to be deliberate.
It needs to be certified.
So in order to certify, you have to have a
basis for believing in your products comply.
And for general use products that basic -- basic
confidence can be a reasonable testing program.
But for children's products that basis
has to be actual product testing.
And I know you're familiar with the
regime enlisted third party laboratories
that are authorized by the commission
to conduct third party testing.
But our children's product testing
rule introduced two terms that I'd
like to spend a little bit of time on
because I think it's important for you
to really get a good grasp of them.
I'm sure you've heard of them before, but
the high degree of assurance and due care.
And we'll put it into perspective of
suppliers and distributors as well.
And from my lens I think it's
very applicable for this audience.
So what is a high degree of assurance?
A high degree of assurance is
defined as an evidence based --
evidence based demonstration
of consistent performance
of a product regarding compliance based on
knowledge of the product and its manufacture.
Knowledge -- not I think -- knowledge
might be experiential knowledge,
knowledge might be research on a particular
factory, or a particular suppliers records
or certification documentation,
but it's knowledge
of the product and the way it was manufactured.
Now it really captures what we expect at CPSC.
So before you put your name on a
certificate, you should have some evidence.
You should have some knowledge that the
product you're certifying has demonstrated
that it consistently complied.
Because hope is not enough and if you
don't have that level of confidence,
that product should not be on the market,
because this isn't for every product,
these are the products subject
to mandatory rules.
So already your government has decided
these deserve some extra special attention.
So we're not saying that across
the board for all the products
that might be in your product lines.
But we are saying it for those that are subject
to the mandatory rules, regulation
standards, or bands.
So for promotional products industry this
will likely fall on importing suppliers.
But it could also be important for
distributors who source directly.
The tricky part, as we'll talk about in a
minute, is figuring out what standards apply
and when they apply who's
responsible for meeting them.
So what's due care?
Let's talk about this other kind
of legal term and obligation.
Our definition -- CPSC definition
of due care follows a similar theme.
It's the degree of care that a prudent and
competent person engaged in the same line
of business or endeavor would
exercise under similar circumstances.
That's a pretty fair definition.
It's not asking for too much.
It doesn't say that you have to be the
number one compliance person in a crowd.
No, you have to have the same kind of level
of competence that somebody prudent that's
in your line of industry that would
exercise under similar circumstances.
But we're clear to point
out what due care is not.
Due care does not permit willful ignorance.
And you all know that because that's why
you're here today and I appreciate that.
And encourage your colleagues to
continue to exercise these options.
Due care shows up in several places in our
statues, but the clearest example is in our rule
that allows a company to rely on certifications
done upstream in its supply chain.
And this is very important.
I would recommend to you to really
understand the extent to which the CPSC allows
and encourages you to rely
on certifications upstream.
To not be redundantly testing but be --
looking for the value add contribution.
So exercise your due care.
So example -- if a certifier certifies
that the product is complaint,
then the distributor can use that certificate
to recertify because that distributor's T's
and C's with their client might require
that that distributor be the one to certify.
They might say, "Well, I can give you
the certificate from my supplier."
They'll say no, no, no -- I want you to certify.
Well you can do that.
That doesn't mean you have
to retest it all over again.
We allow -- the CPSC allows you to
recertify based on a supplier's certificate.
And it can be used in countless scenarios.
You could think of all the
ways that you might be able
to rely upon others test
reports or certificates.
It can be done in many, many ways but I
think it's one to really think of very,
very carefully to make sure that you don't
have your testing costs get way out of control.
Now these legal terms can be somewhat complex,
but the message is quite simple in the end.
Companies need to take ownership
of compliance and safely.
And not just cross your fingers.
So every manufacture has to make an
affirmative effort to ensure compliance.
So the question is now --
who is the manufacture?
Because in our terminology, manufacture
has a lot of responsibilities at CPSC.
Now in most cases that question isn't hard
to answer, but for most promotional products,
that question of who is the
manufacture can be somewhat tricky.
I recognize that.
It could be more challenging.
As you know better than I do, getting
your products to market is a team effort.
Suppliers and distributors each have different
roles that can mean different responsibilities.
So suppliers are frequently, not all the
time but frequently your importer of record.
In that case your supplier will be responsible
for the CBSC compliance as the product exists
when it's in the suppliers control because we
also -- we have import surveillance activities.
So even if a supplier never intends to do
anything other than to allow that product
to be sourced through another distributor
if the supplier is the importer of record,
our compliance officers at the port, if they're
looking at it and asking for a certificate,
will expect that from the importer of record.
Now the distributor will be responsible
for any new requirements that come
from deco applied after sourcing
from a supplier.
So the distributor will also be -- will also
be the first place we look for any problems
with finished product, even if
they existed at the supplier level.
So regardless of whose in the best opportunity
or position to certify to a particular aspect
of compliance, the distributor is
in the best position to certify
to the products entire compliance.
If the distributor used due care and relied
on the supplier certification then
distributor should be safe for anything
that the supplier should have caught.
And for promotional products, the
biggest difficulty for certification is
that the essential nature of the
product can change at a moments notice.
This is where it gets complex.
So for example, an ordinary
plastic drinking cup, right?
It's a generally used product.
It's not subject to any CPSC mandatory standard.
Well, put a cartoon graphic on it -- you
might have just magically turned that product
from a general use product
into a children's product.
The distributor would then need to certify
it to standards that didn't even apply
when it was in the supplier's hands.
So that's what certifications is all about, is
making sure that products comply with our rules,
but we should also talk about
what happens when it doesn't.
So even when you know who needs to
comply, compliance itself can be complex.
It can be tough to stay on
the right side of every rule,
while still getting the product
out on time and on budget.
However the consequences of not
doing so can certainly be far worse.
CPSC can demand civil penalties for as much now
at $15 million and prison time up to five years.
I say that out of the side of my mouth because
it would be a very remote situation, I think.
But going after corporate leaders
for their company's mistakes is a trendy
proposition among law enforcement agencies
in Washington these days.
Just look at the Mining Company CEO who went
to federal prison for regulatory violations.
So it's not an idle threat.
But here's the good news, OK?
Here's the good news.
Realistically -- realistically -- promotional
products companies are not the sort
of game we're hunting at CPSC in terms
of penalties from my perspective.
Our chairman has set a tone
for looking for big names
and big penalties -- multi
million dollar penalties.
So we're looking for trophies, not
small and medium size companies.
Now that could change.
That's a matter of policy at the CPSC.
That's my personal opinion
on what that policy is.
That could change.
A new administration could adopt
a new strategy for penalties.
After all, we have a presidential
election coming.
The agency could pursue instead egregious
violations regardless of business size.
Or it could shift the kind of violation
we're looking for in the first place.
But until CPSC's enforcement
strategy does change,
smaller companies without flashy names
are unlikely to be hit with penalties.
But that doesn't mean that the
violations come without consequences --
because they have consequences
-- significant ones.
Beyond fines and prison times, CPSC has
several other compliance and enforcement tools,
two of which are recalls and import seizures.
We could push for a recall, having to pull
a product back is never good in a business
where reputation is critical, where your
clients trust you in their reputations.
I mean think about that right, you're clients
are trusting you with their reputation.
I mean that's a lot of responsibility.
That's a lot of responsibility that you hold.
So even a simple recall might
be even more problematic.
So making sure your product complies
before it leaves your hands is the best way
to be sure you never have to get it back.
We can expect that the CPSC
are even seized at the port
and once we seize products we
have the authority to prevent them
from even going back out of the country.
So especially under the times of
pressures for promotional products,
any disruption in the flow a
product could be disastrous.
Faithfully complying with the certification
requirement helps give our port inspectors the
confidence to keep your shipments moving.
So there are real rules you need to follow
and serious consequences for breaking them.
So how do you follow them?
Successful compliance is a very
narrow and frequently confusing path.
And there are severe penalties for straying.
But that doesn't mean it's impossible.
In fact there are great resources available
to help businesses deliver
safe -- only safe products.
So the thing to remember is though --
that compliance doesn't just happen.
It just doesn't happen by mistake.
It takes a deliberate effort.
I know I've used that word
twice -- deliberate --
because I want it to sink in because I think --
but I do think there are three key
steps coming back to education --
that you need to understand the product,
you need to understand the materials
and you need to understand the rules.
So first -- understanding your product.
The most critical education is
learning about your product.
It may sound obvious but compliance
obligations hinge on the nature of the product
and the nature can change as we
talked about the deco example.
It can change based on what happens to the
product after if leaves your hands, suppliers --
after it leaves your hands
suppliers and goes to a distributer
and then a distributor goes to deco.
Everyone needs to be familiar with what
the certification encompasses potentially.
What mandatory or voluntary
standards apply to your product?
Who will be using it and how?
What logos or markings will be on it?
Where will it be distributed?
These factors and others go into determining
whether it's a children's product?
And that will determine the
rules you need to certify to.
For example, Paul mentioned
I have three daughters.
I've got to eight year olds
twins and a four year old.
And they recently went to a birthday party,
I picked them up and part of their little --
their little bag of gifts to take away,
they had a gorgeous little stress ball.
And they got it as a party favor, right?
It's probably somebody's client -- somebody in
the room probably put that together for them.
Stress balls themselves are
generally used products, right?
And they're not children's products.
But distribute them to kids -- you know, and
put cartoon logos on them -- characters --
and you've magically turned
them into a children's product.
So where as before, you know, it was one thing.
It changes in terms of the
nature of the distribution.
So that's something that this particular
industry will have to struggle with and continue
to keep in mind -- more --
more than other industries.
The distributor might then have to
scramble to conduct third party testing
so that no supplier would ever -- and no
supplier would ever have dreamed that necessary
in the first instance, perhaps when
they were asked to source the product.
Understand the materials
that are in the product.
Once you know what the product will be, you'll
need to determine what has gone into it already.
You need to know what materials
are in the product and whether
or not they contain heavy metals or phthalates.
Now you may need to know that even if it's not
the obligation of the CPSC because many clients
of distributors want products free of
these and other chemistry regardless
of whether it's the law, regardless of whether
or not specifically CPSC has
particular standards for that.
You need to know what testing or
certification was performed on those blanks.
And for a supplier who frequently sells
children's products it may make sense
to source only blanks that have been tested
and certified by your factories in China,
to children's products standards that
may be an attractive option for you.
Spreading the cost of testing over
your entire inventory might be cheaper,
might be more predictable then having to
test at [Inaudible] when orders come in.
And it's certainly cheaper
than a recall or a penalty.
The third recommendation is of
course, understanding the rules.
Once you know exactly what the
product is and how it will be used,
you can determine which rules apply.
You can certainly flip through
our CPSC regulations.
They're only 939 pages long.
My staff in the corner counted them.
But that might not be the most
efficient use of your time, right?
I know I haven't read through
them all [Laughing].
Instead there's some good sources of information
and it comes straight from the horse's mouth.
And I think -- you know I look at our
web traffic statistics and I think --
you know, because I'm going through
there constantly trying to ask myself
or tougher questions come to me and I use
our CPSC resources to answer those questions.
Our office of compliance and enforcement --
they publish a regulated product handbook
that provides a great starting point.
So that should be part of your library.
At CPSC.gov you can find a wealth of
information in our business education section --
everything about certification,
and on component certification how
to rely on others certifications.
And Neal built himself a
robot when he was with CPSC.
Do you guys know about the robot?
Yes, using the robot?
I'm checking the stats on that too, by the way.
Find out how many -- how much mileage
we've got under the feet of the robot.
But look seriously, the regulatory robot
will walk you through step by step a series
of detailed questions and it helps
you understand what rules might apply
to your product.
You know Neal, he gives you great
information, he built it -- so you can trust it.
So you should use it.
And that's a creation of our
Small Business Ombudsman.
And that's the mission of Ombudsman
is to talk with regulated community,
provide information you need, reach out to
and get to know our new SPO
-- a player to be named later.
We're still filling the position.
But Will Cusey is the acting Small Business
Ombudsman and he's terrific people too.
And you can always call the
office of compliance directly.
I don't think people take advantage this as
much because they think that they're scary.
Is Tanya here in the room?
Is Tanya still here?
No? OK. Well, if she was you could say,
"Look, she's terrific to work with."
Our office of compliance -- the staff are really
there and they're easy to be able to visit with.
Not only will they get you an expert
answer, but they'll help you --
it will help you see the
product through their eyes
and they'll ultimately potentially have a
final say in the compliance of your product.
You know, there's a myth.
And it astounds me how this myth persists.
But that company shouldn't talk to our
compliance staff, because if you pick
up the phone and talk to the CPSC,
then you're asking for a recall.
And that is -- I'll tell you -- if that were
the case I wouldn't recommend you to do it.
Because I don't think every time you
have something you have a question,
you necessarily think you need to have a recall.
But that's really a myth.
We don't -- even when you come to a situation
where you think you have an obligation to report
that a product could -- not is -- but
could be a substantial product hazard --
that's your reporting obligation,
that's a big one,
that's the violation that
we seek penalties over.
We want people to talk to us.
Talk to us through a Section 15 report.
But you know, only about
one-third of those reports --
now when a report comes in like this
-- I got to tee this up a little bit.
A Section 15 report, sometimes somebody
will do it through a fast track recall,
where they already know that they need to
recall this product, they'll take advantage
of a program that gets a recall out
in the street very, very quickly.
But then there's the other 15 reports that --
you know, they didn't come through fast tracks.
They don't necessarily know whether
or not the product is a substantial
product has or it needs to be recalled.
You know only about one-third of
those reports result in a recall?
Only one-third.
So don't think that reaching out
the CPSC means you're reaching
out and you're asking for a recall.
It's just not the case and it's a myth and I
think it keeps a lot of people from engaging
with CPSC staff and I hope that is might dispel
some of those -- some of those false ideas.
Now in conclusion I would
like to applaud PPAI success.
I said this at the beginning and
it's all of your success here.
You own it.
PPAI is a valuable resource, however I'd also
say -- and now you've got a fantastic community.
You are not a community of mostly compliance
directors, the wisdom of your peers.
That might be more valuable than
anything you'll find online.
Talking to your colleagues
about problems, about successes
and lessons learned can tell
you where the pitfalls are.
Trade associations like PPAI, they have a vital
role to play in this exchange of knowledge.
PPAI in particular has become a model
-- a model for safety education.
And I've seen a lot of them.
We've got a ton of industries that have products
that we regulate and it's an absolute model
and the leadership of Rick Brenner, Gene
Geiger, Anne Stone, Sue DeRagon from UL
who I think is their preferred supplier has
been fantastic for years, countless others.
PPAI has made remarkable efforts
to educate its membership.
That's you.
And this summit is a great example.
As is the online tool that the PPAI has, the
regulatory -- they got a robot too, Neal.
They're going to have a robot "Rock'em
Sock'em" between the turbo test and ours?
But look, those efforts don't go unnoticed at
CPSC and the entire agency appreciates having
such diligent partners in safety.
If the size and eagerness of this crowd is at
all indicative of your commitment to compliance
and safety, I'm confident that the organization
and it's members will continue to thrive
and deliver safe and enjoyable
products for years to come.
So thank you for listening.
I wish you all a tremendous success
and again, thank you very much.
[ Applause ]
Well I don't know if I've used up all the
time for questions but I think Gene's going
around and Rick's got a microphone too.
I'm happy to take questions.
>> I'm on?
OK, I'm on.
Commissioner, let me just
ask if anybody has question
but I've got a question if
there isn't anyone first.
Oh back of the room.
George?
>> Just a clarification, several
times -- I'm a distributor.
>> OK.
>> Several times you mentioned
a product coming in --
I assume other than apparel that
would then go to a decorator.
That doesn't happen that often with
hard product -- at least my cases.
>> With your water bottles and other product?
>> That would all be done by the supplier
that brought them into the country.
>> Oh, OK -- OK.
>> So that -- but I'm worried about the
liability then would stay with the supplier
and the certifications would come from his
companies in China certifying the product
and then him decorating it
here in the United States
and then passing in on to me to my end user.
>> Well, I think your first -- first
I think I know what you're saying.
I used have this 18-wheeler truck.
And it was like a blank and on the side.
So it just demonstrated you
can -- that you can bring these
in as toys and then deco would be applied.
But George, you mentioned that
you're brining in the product
and it's already had deco applied to it, right?
So it's finished, it's ready to go.
OK, in that case the importer
of record would be certifier.
>> OK.
>> Now, I don't mean to make
this overly complex,
so I'll -- but I'll provide the answers.
In providing that certificate you can rely
on other certificates of the paint separately
of the product itself separately -- I
don't think we said what the product was.
But the same could be said for apparel as well.
And remember there's children's apparel too.
>> Right, yes --
>> So you've got children's apparel, you've got
patterns, then you've go lead buttons you got
to worry about, but you could
be deco there here.
Now in the situation where you brought it in
as a blank and then it went to distributor
and then distributor when to deco,
then the distributor would have to rely
on deco certification or
in to recertify themselves.
So then you've got a patchwork
of several certifications.
Does that answer?
>> Thank you.
Yes, it does thank you.
>> Terrific, good question.
>> Commissioner, I have a
couple of questions for you.
One is -- deals with the political nature
of the agency and where the next --
>> I just said we all get along.
There is not politics.
We're all big one happy family.
[ Audience Laughing ]
>> So you alluded --
>> I don't have any statement --
>> You alluded to a new collegiality
between the commissioners and maybe some
of our members aren't familiar with some
of the old party line issues that led
to Chairman Kaye's taking that perspective.
However, many of us don't understand
the nexus of party politics and safety.
So if you could -- if you could
discuss that a little bit,
you know you certainly have a
long record as friend to business.
You are a Republican member of the commission,
you're a minority and what that all means
with you and Commissioner Buerkle.
And then as part of that you have descended
from significant decisions that have been made
by the commission on civil penalties
and you have published rather articulate
documents explaining your position.
So if you've got a opinion,
tell us a little bit about that.
>> That's a good point.
You know, we still disagree among -- now that
we have different commissioner than maybe
when things were -- when the fur was flying
maybe a little bit more five years ago or so.
I've only been on the commission for two years.
We do have that collegiality.
We might still have some of
the same disagreements --
we just might be disagreeing
without being disagreeable.
Sometimes our -- you know, sometimes
our blood gets up a little bit
and it gets a little bit more intense, you know?
But I think, you know, you asked about the
party politics with thinking about party.
You know what commissioners are wrestling with?
Well, we're all wresting with is
how to we define unreasonable?
You know and that's where you get
maybe some differences of opinions.
You know in terms of what was an
unreasonable decision that somebody made
at the time given the information that they had.
Was that reasonable?
Was that something that is worthy of a penalty?
If somebody reported -- so you mentioned by
descents, so here's something that I found
in a general setting, when we've got penalty
provisions coming forward, in most cases I find
in my own opinion, because I have one,
is that in these matters specifically
with a vote is what I mean by that.
I find that there was a failure to report,
but where I might disagree with some
of my colleagues or disagree with staff or maybe
negotiating with a company or making a proposal
to the agency is when that reporting
obligation occurred and when it was really late.
So you get to a point of degree
-- you get a point of degree.
And I think something else that we're wrestling
with but you know, we do have some successes
in working together -- cutting out
some of the redundant paperwork.
We've done a nice job earlier this year, in
this specific area to cut out paperwork burden
with regards to certificates for apparel
that was 100 percent not subject
the flammable fabrics act.
But I think -- you know, we still do
disagree on some particular matters
but I think we've got some cultural norms
about the way that we go about our business.
>> Any other questions?
>> Leeton.
>> Commissioner, I know this is probably going
to be something near and dear to your heart
with your background at Intertek.
Now everybody in this room sees reports -- test
reports from labs that are China based labs.
And when we ask our vendors or suppliers for
test reports, hopefully we'll get a very valid
and applicable and complete test report.
But sometimes I see test reports from
China labs that I've never even heard of.
And I'd have to go on the CPSC
website and say who are these guys?
I have never even heard of them before.
And then I have to question,
OK are these reports valid?
If -- have the lab been validated by the
commission, it's listed on the website,
but has there been a history of some
of these other local labs having issues
with reliability of their testing?
And you know, how do we now?
Is there a -- is there information
that those of us who are in this room
who help our clients validate
the programs to be able
to determine whether this
lab is a legitimate lab?
>> I'm certainly not going to wade in the
waters on [Laughing] who my favorite labs are.
Because coming directly from the industry.
Instead I'll lay out a little bit of the
requirements to get listed by the CPSC.
Because at the very least, I mean if you're
thinking about using a lab and the CPSC
to an extent has accredited them
by listing them as authorized
to perform CPSC mandatory third party testing --
then you should hope to be able to take
some confidence in terms of the abilities
of that lab to perform their duties.
What we do rely upon in that
particular scheme because we are
so small is we rely upon other accreditations
from the National Accrediting bodies
that look at the laboratories.
Among those laboratory accreditations are
activities like round robin testing, etcetera,
to make sure that they're testing with certified
samples to make sure that they're coming
up with the numbers that they
should be coming up with.
So the extent that which I'll just have
to say it this way in somewhat of a punt,
because I'll be a little bit
uncomfortable with my background saying --
well, this is the way I would
go about selecting a lab.
I would say the fact that the CPSC holds no
greater or less legitimacy with a test report,
as long as it's coming from one
of our certified laboratories.
So I've never seen anything to the contrary,
I've never seen in my two years here anybody
have specific questions about the compliance
of a product after looking
at a test report and saying
because it was done by x lab or y lab, OK?
Sorry I couldn't be more
specific with that Leeton.
>> Sure, thanks.
>> Commissioner, I was thinking about
the last eight years we've spent worrying
about children's products and we had a couple
sessions yesterday about California Prop 65
and then we got California green chemistry
thing, and we got Washington State
and we've got Connecticut
and all this kind of stuff.
So we've got it all under control.
So I guess since we've got everything under
control right now, could you look ahead?
Is there something as you look
ahead for the next few years --
>> How did you get that all under control?
You take Children's Safe Products Act,
California Green Chemistry, Prop 65 --
>> It's almost entirely under
control, but from your perspective
if you look ahead do you see anything
that we should also be paying
attention to from your perspective.
>> You know I think -- you know
the big movement in that area --
look I sympathize with the proliferation
of state regulations and you know,
I was one of those -- one of those
women and men as a state representative.
I was in the legislature in New Mexico for
four years and I can tell you from experience
in dealing with complex matters like
the ones that we deal with here --
to try to take them up on state level
and to put together wide public
policy in a state is challenging.
I'm not a big fan of these like
bad dandelions in my backyard --
the proliferation of all these
different reporting requirement.
You know, I think -- I think there's going
to be more to come although I think I have
to remain optimistic that because we had --
we just reformed the Toxic Substances
Control Act after decades, right?
Yes, decades.
That hopefully that will
provide a little bit more
of pre-emptive federal one standard
that will apply state by state.
But you know the problem in
looking at a lot of those --
looking at Washington, I think
that's a reporting obligation,
I think Maine is a reporting
obligation too -- right, Maine?
Is that the CPSC -- we have
authority to preempt.
That means if we have regulation
on a particular standard
on a product -- that will preempt other states.
And that's because one of the things that CPSC's
mission is to create a uniform set of standards.
That's why we were created in
1973 to provide a uniform set
of standards to promote interstate commerce.
These -- the proliferation
of all these state laws,
all getting to the same thing
is really hindering that
and I think it's making the United States --
putting the United States at
a competitive disadvantage.
I do think it will still happen.
I think there's a very real movement out there
state by state to keep promoting these --
you know, they're called often
"consumer right to know", right?
Like Prop 65 is in its essence
is a labeling law.
But we don't have -- the CPSC doesn't have the
authority to preempt that kind of standard.
So unfortunately I think until -- until states
-- you know, I started learning more about it --
there are some industries and you
might think it's completely irrational
that are just moving out of California.
They just won't-- they won't sell in California.
So they'll be 49 state compliant.
And that's for very specific industries,
but California as a state has made it
so inhospitable to conduct business.
But I know you're question
was broader than that.
I think we'll still keep seeing it until we
have enough of a reaction that legislatures know
to pump the brakes on some of those laws.
It's only going to get more
complex I'm afraid to say.
>> Other questions?
>> I have a question back here.
>> Yes, Paul.
>> So you were very, very complementary
of the association while you were
up there and during our lunch.
What else can PPAI be doing
to help CPSC help us?
What's our next step from your view?
>> Well, I really think that
you're at the tip of the sphere.
To be honest you have a healthy
wonderful working relationship.
I mean look at the amount of
participation you're getting from CPSC here.
I still -- I was telling folks
at the table and others --
you know, I still have my PPAI folder, OK?
I think it was from New Orleans.
But I still have it.
It's a tremendous resource
and as Sue wrote a lot of it,
which is while it was fantastic
as well -- Cheryl Falvey.
You know, Paul, if I had
something in mind I'd tell you
but I think right now you're making
all the right moves and continue
to report -- I think, you know what?
This is what I would say.
If there is a way you can promote the
collegiality among the group and I know --
Gene and Rick have done that so much in
a leadership way, but these relationships
that you have here at these tables
-- the networking that you do --
that can be more valuable then anything
you might be able to read on a website
from understanding what some of the new
techniques that somebody is getting to.
So the way that you might be able to continue
to facilitate networking among this part
of your association -- because I
know the association is everything
and not just safety compliance --
that would be my recommendation.
>> Terrific, thank you so much.
>> Your welcome.
>> Any other questions?
>> Oh, one back here.
>> Speaking of adding on to that, what's an
industry that's not doing it well right now?
[Laughing] And is there anything
that we can learn from them?
I don't know if you have any insight on that.
I just thought I'd lighten the room up.
[ Audience Laughing ]
>> I want to hear the answer to this question.
This is going to be a really good answer.
>> Hold on.
My cell phone's getting hot.
[ Audience Laughing ]
No that's quite all right.
You know, I'll tell you one of the things
that troubles us -- this is engagement.
You're engaging with me, the agency is
engaging with you in a very proactive way.
We're seeing some industries
from a sense of frustration,
from either our compliance activities
or from our penalty provisions
wanting to just step back.
And you know, I'm not going to
name them but when I was here
in a staff capacity the first time
there was a major association,
they still exist and they're still major.
And they were even a collator for CPSC,
meaning they even brought in other associations
and you know, and got together on
CPSC issues and they're just --
they're just not present right now.
But you know, I will say to
be an apologist for them,
the government has created an incredible
onerous regulatory environment.
What you're dealing with is a microcosm
of what's happening to the United States.
And for that reason they may have
bigger fish to fry than the CPSC,
but you've got me thinking about that.
And you know, we need to remember that.
And you know, safety is important for all of us.
It's important for you -- for of
course, in the end -- the end consumer.
But safety and regulations need to make sense.
They need to be value driven.
So continue to push -- you
know, back when you're finding
that things are just paperwork burdens
that you don't see the value add.
Let us know about it and give us the
opportunity to try to correct it.
Good question.
>> Before the commissioner jumps off, I
just want to editorialize and say what I --
we said around the table and what I
said to Commissioner Adler yesterday.
We could not have had a more collaborative,
helpful, supportive, response from the CPSC
than we've had over the last six or so years.
I mean Neal Cohen has been superb
and has been with us at every event.
But from the start of our summits and every
single year and in between our events,
the CPSC who one might think is -- just wants
to regulate and tell us what to do and so on --
have been more than collaborative and
helpful in our journey moving down this path.
And I thank the commissioner for that.
We could not have had a better partner
helping us understand what we need
to do and working with us.
It helps that we've been
open and transparent and Paul
and Rick have been the leaders helping
our association along, but we've got a --
we've had a real collaborative
credible partnership
with the CPSC who's both regulating us but
helping us to move along on our journey.
>> Good.
>> Thank you so much.
>> Thank you.
Thank you all.
Congratulations to you.
[ Applause ]