
[Federal Register Volume 75, Number 242 (Friday, December 17, 2010)]
[Notices]
[Pages 79035-79048]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-31695]


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DEPARTMENT OF LABOR

Occupational Safety and Health Administration

[Docket No. OSHA-2008-0032]


Nationally Recognized Testing Laboratories; Supplier's 
Declaration of Conformity

AGENCY: Occupational Safety and Health Administration, Labor.

ACTION: Notice.

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SUMMARY: Based on its analysis of comments received in response to a 
Request for Information published in October 2008, the Occupational 
Safety and Health Administration will not initiate rulemaking to permit 
the use of a Supplier's Declaration of Conformity as a means of 
ensuring the safety of products currently requiring approval by 
Nationally Recognized Testing Laboratories.

FOR FURTHER INFORMATION CONTACT: Press inquiries: OSHA Office of 
Communications, Room N-3647, U.S. Department of Labor, 200 Constitution 
Avenue, NW., Washington, DC 20210; telephone: (202) 693-1999. General 
and technical information: MaryAnn Garrahan, Director, Office of 
Technical

[[Page 79036]]

Programs and Coordination Activities, NRTL Program, Occupational Safety 
and Health Administration, U.S. Department of Labor, 200 Constitution 
Avenue, NW., Room N-3655, Washington, DC 20210; telephone: (202) 693-
2110. OSHA's Web page includes information about the NRTL Program (see 
http://www.osha.gov, select ``N'' in the site index).

SUPPLEMENTARY INFORMATION:

I. Introduction
II. Background
    A. Requirement for a High Degree of Protection for Product 
Approval Standards
    B. Events Leading to the Second RFI on SDoC
    C. Overview of OSHA's NRTL Program
    D. Overview of the EU's SDoC System
    E. The EC's Formal Proposal
    F. OSHA's October 20, 2008, Request for Information on SDoC
III. Summary of Findings
    A. Statistical Evidence Concerning Workplace Safety under an 
SDoC System
    B. Analysis of the Components of an SDoC System
    C. Proposed Alternatives
    D. Use of SDoC in the U.S.
    E. Post-Market Surveillance in NRTL v. SDoC Systems
    F. The Costs of Administering an SDoC System
IV. Effects on Trade
    A. Background
    B. Analysis of the Trade-Barrier Issue
V. Concluding Remarks

I. Introduction

    In a Request for Information published in the Federal Register on 
October 20, 2008 (``2008 RFI''), the Occupational Safety and Health 
Administration (``OSHA'' or ``Agency'') requested comments on a 
proposal it received to permit use of a Supplier's Declaration of 
Conformity (SDoC) as an alternative to OSHA's current Nationally 
Recognized Testing Laboratories (NRTLs) product-approval process. (See 
73 FR 62327.) OSHA received the proposal from the European Commission 
(EC), which advocated an SDoC system for specific electrical products. 
The European Union (EU) currently permits its Member States to use SDoC 
for these products. The EC's proposal stems from its belief that SDoC 
assures the safety of such products, and that OSHA's NRTL system 
constitutes a technical barrier to trade.
    After thorough analysis of the comments received, and due 
consideration of the concerns, issues, positions, and suggestions set 
forth in comments to the 2008 RFI, OSHA finds, based on the record, 
that an SDoC system would not provide the high degree of protection 
required by the Occupational Safety and Health Act of 1970, 29 U.S.C. 
651 et seq. (``OSH Act'' or ``Act''). By this determination, OSHA is 
not asserting or implying that the EU's SDoC system is deficient for 
the safety purposes and goals it serves in the EU. The EU, like all 
governments, must choose an approach to safety approvals that comports 
with its political and legal authority and that satisfies its needs and 
priorities. However, as explained in this notice, OSHA finds that the 
evidence in the record does not support a conclusion that SDoC is 
appropriate for U.S. workplaces, given OSHA's legal authority and 
responsibilities.
    NRTLs are independent (i.e., third-party) \1\ laboratories that 
meet OSHA's requirements for performing safety testing and 
certification of products used in the workplace. NRTLs test and certify 
(i.e., approve) these products to determine whether they conform to 
appropriate U.S. product-safety standards. The NRTL issues a 
certificate to declare the product conforms to the particular 
standard(s). In contrast, in an SDoC system, the manufacturer issues a 
declaration attesting that the product meets the standard or other 
requirements. This manufacturer's declaration may be based on testing 
performed by the manufacturer, by a third-party, or by a user of the 
product. The EU's SDoC system allows manufacturers to rely on, but does 
not require, third-party testing. Manufacturers are responsible for 
maintaining a written declaration of conformity or other allowable 
evidence of conformity, and a technical file demonstrating that the 
manufacturer tested the product to assure conformity with the 
requirements specified in the applicable EU directive. (See section 
II.D of this notice, for more information.) Under SDoC, regulatory 
authorities must also have a system to audit, and to bring enforcement 
action against, product manufacturers and, possibly, product 
distributors, including retailers. In some cases, as in the EU, such a 
system involves post-market surveillance, under which the authority 
checks the conformity of products after they are already sold in the 
market. Several U.S. Federal agencies allow SDoC for the specific 
products they regulate.
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    \1\ A third-party system is one of the three types of systems 
generally used for an attestation of conformity (i.e., attesting 
that certain requirements are met). The other types are first-party 
attestation, which is issued by the supplier (e.g., a manufacturer), 
and second-party attestation, which the user issues.
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    The 2008 RFI is OSHA's second RFI addressing SDoC. The Agency 
issued a similar RFI in 2005 (``2005 RFI'') in response to a proposal 
from an industry trade association for OSHA to use an SDoC system for 
information technology products. Much of the information submitted by 
the commenters in response to the 2005 RFI lacked the supporting data 
and details requested, or lacked adequate support or explanations for 
the data cited. OSHA found that the information provided by the 
commenters did not justify a decision to initiate rulemaking to adopt 
an SDoC system. Furthermore, OSHA believed that it lacked the legal 
authority and resources to adopt many of the enforcement measures 
required for an SDoC system, including product recalls, bans, and 
confiscation, among other measures. In view of these findings, which 
address only a few key areas of concern, OSHA decided to take no 
further action on the trade association's proposal, and announced its 
decision in the Spring 2007 Semi-Annual Regulatory Agenda, published on 
April 30, 2007. (See 72 FR 22870-02.) For more information on this 
matter, see the discussion of the 2005 RFI in the introduction to the 
2008 RFI (73 FR 62328-29).
    OSHA seldom publishes a notice discussing the results of an RFI. It 
is issuing a notice in this case because of the unique and complex 
issues involved, and, as a result, to provide interested parties with 
details on OSHA's reasoning on this decision. OSHA did not provide such 
rationale when it announced its decision on the 2005 RFI. In this 
Federal Register notice, OSHA provides a summary of the 2008 RFI, a 
discussion of its analysis of the comments to the RFI and the trade 
issues involved, and its conclusion. The Background section begins with 
a discussion of the OSH Act's standard-setting requirements, and then 
describes the events that led to the publication of the 2008 RFI. Next, 
the Background section provides an overview of both OSHA's NRTL Program 
and the EU's SDoC system, followed by the EU's rationale for its 
proposal and a discussion of the 2008 RFI.

II. Background

A. Requirement for a High Degree of Protection for Product-Approval 
Standards

    The primary purpose of the OSH Act is to assure, so far as 
possible, safe and healthful working conditions for every American 
working man and woman. (See 29 U.S.C. 651(b).) To fulfill this purpose, 
Congress gave the Secretary of Labor the authority to promulgate,

[[Page 79037]]

modify, and revoke mandatory occupational safety and health (OSH) 
standards.\2\ (See 29 U.S.C. 655.) The Act, and the case law developed 
under it, establish a number of requirements that OSHA must meet before 
exercising this authority. Some of these requirements are procedural. 
For example, OSHA must support its findings with substantial evidence 
in the record developed through the rulemaking proceedings, and explain 
the basis for accepting or rejecting major suggestions for modification 
of a proposed OSH standard. (See, e.g., ``Supplemental Statement of 
Reasons'' for the final rule on Control of Hazardous Energy Sources, 58 
FR 16612 at 16621; see also 29 U.S.C. 655(b) and (f).) In addition, 
when OSHA decides to revise an OSH standard, it must provide a reasoned 
basis for the revision. (International Union, UAW v. OSHA, 37 F.3d 665, 
669-70 (DC Cir. 1994) (``Lockout/Tagout II'').)
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    \2\ OSH standards contain requirements that are imposed on 
employers for ensuring safety and health in the workplace. They are 
different from a test standard, which we describe later in this 
notice, and which specify technical requirements that products must 
meet.
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    OSHA also is constrained by substantive rulemaking requirements. 
The OSH Act requires that safety standards, like the NRTL product-
approval (or product-conformity) requirements, must provide ``a high 
degree of worker protection.'' (Lockout/Tagout II, 37 F.3d at 669 
(quoting ``Supplemental Statement of Reasons'' for the final rule on 
Control of Hazardous Energy Sources, 58 FR 16612 at 16615).) Thus, for 
OSHA to adopt an SDoC system, it must find, on the basis of substantial 
evidence, that the SDoC product-approval system provides a high degree 
of protection to workers who use equipment that would be covered by the 
standard. The ``high degree of protection'' requirement allows OSHA to 
``deviate only modestly from the stringency required by section 6(b)(5) 
for health standards,'' which must eliminate significant risk, or 
reduce that risk to the maximum extent feasible. (Lockout/Tagout II, 37 
F.3d at 669.) In this regard, OSHA is careful to ensure that 
modifications to its approach for product conformity maintain the 
required high degree of worker safety. (See 53 FR 12103.)
    OSHA considered two approaches to determine whether an SDoC system 
would provide a high degree of protection. One approach is to examine 
whether there are valid statistical data that show a direct correlation 
between a method of protection and low rates of illness or injury. 
Another approach is to examine qualitatively the operation, attributes, 
and elements of the system to determine whether it is likely to provide 
a high degree of protection. By way of illustration, consider the use 
of a warning alarm on equipment that operates near power lines to 
provide adequate warning of possible contact with a line. Having valid 
statistical data demonstrating that such an alarm measurably reduces 
these types of contacts and resulting injuries could provide a basis 
for concluding that requiring the alarm would provide a high degree of 
worker protection. OSHA then would consider proposing a requirement 
that employers working near power lines install such alarms on cranes 
or other equipment that could contact these lines. Alternatively, OSHA 
could examine the method's operation and attributes. If the operation 
of the alarm under prescribed conditions showed that it consistently 
provides a timely warning, OSHA could conclude that requiring the alarm 
would contribute toward providing a high degree of worker protection, 
and could consider including it in a proposed rulemaking. However, if 
the elements of a method provided little or no assurance of 
safeguarding against a hazard, the method would not provide a high 
degree of worker protection. For example, if the alarm failed to 
operate in a predicable manner, and if safety testing provided 
inconsistent results, then OSHA would not have confidence that the 
alarm would contribute toward providing the required high degree of 
worker protection.
    As discussed later in this notice, commenters to the 2008 RFI did 
not submit to the record valid statistical data for determining the 
degree of protection afforded by an SDoC system. In this regard, OSHA 
found that the data submitted to the record did not demonstrate the low 
risk of injury claimed for an SDoC system by its proponents. In 
addition, OSHA analyzed the elements of the SDoC system to determine 
whether these elements would provide assurance of a high degree of 
worker safety; this analysis showed that the elements of the SDoC 
system did not provide such assurance. We discuss the results of this 
analysis in Section III (``Summary of Findings'') below.

B. Events Leading to the Second RFI on SDoC

    On April 30, 2007, President Bush and his EU counterparts signed 
the Framework for Advancing Transatlantic Economic Integration Between 
the U.S. and the EU (``Framework Understanding'' or ``Framework''). 
(Exhibit OSHA-2008-0032-0002.) This trade-related understanding has a 
number of objectives, the foremost of which is ``removing barriers to 
transatlantic commerce.'' (See section II of the Framework.) The 
Framework's Annex 1 lists a number of activities affecting different 
U.S. and EU agencies and sectors, including ``initiating an exchange on 
conformity assessment \3\ procedures for the safety of electrical 
equipment.''
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    \3\ While OSHA uses the term ``approval'' to describe the type 
of testing and certification activities performed by NRTLs, the 
international community often uses the term ``conformity 
assessment'' to describe these activities. ISO Guide 2 defines 
``conformity assessment'' as ``any activity concerned with 
determining directly or indirectly that requirements are 
fulfilled.''
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    The Framework established a Transatlantic Economic Council (TEC) to 
monitor and advance progress toward meeting the goals of the Framework. 
As stated in the Framework, the TEC is ``co-chaired, on the U.S. side, 
by a U.S. Cabinet-level official in the Executive Office of the 
President and on the EU side by a Member of the European Commission, 
collaborating closely with the EU Presidency.'' (See section IV of the 
Framework.) Through the TEC, in July 2007, the EC issued a brief 
statement proposing that OSHA adopt SDoC for ``electrical and ICT 
equipment,'' claiming that this action would ``reduce unnecessary costs 
for transatlantic trade.'' (Exhibit OSHA-2008-0032-0003.)
    Working in part through the TEC, OSHA and the EC arranged a meeting 
to exchange information on conformity-assessment procedures for the 
safety of electrical equipment. The meeting was held on October 11, 
2007. A summary of this meeting describes the key elements of each 
party's respective NRTL and SDoC systems. (Exhibit OSHA-2008-0032-
0004.) At a subsequent meeting on November 9, 2007, the TEC issued a 
joint statement requesting OSHA to report, at the TEC's next meeting, 
on ``progress made to facilitate trade in electrical products with 
respect to conformity assessment procedures for the safety of such 
products.'' (Exhibit OSHA-2008-0032-0009.) In March 2008, the EC issued 
another statement asking the ``[U.S.] Government to allow the import 
and sale of any low-risk electrical and electronic product on the 
basis'' of an SDoC.\4\ (Exhibit OSHA-2008-0032-0005.)
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    \4\ OSHA does not regulate the ``import and sale'' of products, 
but its rules do affect whether employers may use specific products 
in the workplace, thus affecting, to some degree, whether those 
products may be sold or imported into the U.S.

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[[Page 79038]]

    At the second formal TEC meeting, held on May 13, 2008, the 
Secretary of Labor announced that OSHA would issue a second RFI on 
SDoC. (Exhibit OSHA-2008-0032-0009.) This second RFI would improve 
OSHA's understanding of SDoC and other related topics and issues not 
fully explored in the 2005 RFI. In June 2008, at OSHA's request, the EC 
submitted a formal rationale for its proposal that OSHA permit SDoC for 
electrical products.\5\ During these events, OSHA noted that it 
received no convincing information demonstrating that NRTL approval and 
program requirements are barriers to trade. Section IV (``Effects on 
Trade'') of this notice explains OSHA's position on these trade issues.
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    \5\ While the EC distinguishes between electrical and electronic 
products, such products are electrical products for purposes of 
OSHA's approval requirements.
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C. Overview of OSHA's NRTL Program

    Since its inception, OSHA has required that electrical and other 
types of equipment be approved by qualified organizations as one means 
to ensure the safety of this equipment. Pursuant to the OSH Act, OSHA 
based this requirement on available consensus codes and standards. The 
requirements for NRTL approval of electrical equipment are detailed in 
29 CFR 1910, subpart S. The provisions of this subpart require approval 
\6\ of most electrical equipment used in the workplace. The purpose of 
the requirements is to ensure that the electrical products will, when 
used in the workplace, provide workers with a high degree of protection 
from the hazards associated with use of these products.
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    \6\ That is, ``accepted, or certified, or listed, or labeled, or 
otherwise determined to be safe'' by an NRTL, as defined in 29 CFR 
1910.399.
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    Following its normal rulemaking process, OSHA published a rule on 
April 12, 1988 that established the NRTL Program. (See 53 FR 12102.) 
The rule implements the elements of OSHA's product-approval approach, 
and requires that a testing laboratory must satisfy the following 
requirements to be recognized by OSHA as an NRTL: (1) Have the 
capability to perform the required testing; (2) have controls and 
services for assuring that tested equipment conforms to the appropriate 
test standards; (3) be independent from manufacturers, suppliers and 
vendors of tested products, and from other employers; and (4) have 
procedures for producing credible findings and reports, and for 
handling complaints. (See 29 CFR 1910.7, 53 FR 12102.)
    OSHA found that each of these requirements was necessary to ensure 
that workers are safe when working with or exposed to electrical 
equipment. The capability requirement ensures that the NRTL has the 
requisite expertise to test specific products to the applicable 
standards. ``Each NRTL's capability must be demonstrated in relation to 
the specific product being tested, the testing standards, methods and 
procedures being used * * *, and the quality of engineering decision 
making needed to reach a workplace safety determination for the 
product.'' (See 53 FR 12107.)
    NRTLs also must conduct continued oversight of certified products 
to ensure that the products continue to conform with the test standard 
as production proceeds. Specifically:

    This part of the definition of NRTL has three elements: The 
implementation of control procedures for identifying the listed or 
labeled equipment; production line inspection to assure [continued] 
conformance with the test standard; and * * * post-marketing field 
inspections to monitor and assure proper use of the mark or label.

(Id.) Each of these three elements provides assurance that all units of 
the products approved by the NRTL continue to provide the same high 
degree of protection as the unit or prototype tested and certified 
initially by the NRTL.
    The independence requirement is a particularly important component 
of the NRTL Program. ``Absent the direct involvement of OSHA in testing 
laboratory decision making, this independence requirement is necessary 
to assure the integrity of the testing activities.'' (Id.) Thus, the 
independence requirement protects against self-dealing that may arise 
when an entity certifies a product it manufactures.
    Implementing adequate internal controls also is critical to the 
NRTL Program. Each NRTL must establish internal controls to ensure that 
it produces credible findings and reports to support its certification 
determinations, and each NRTL must have set procedures for handling 
complaints and disputes. These controls provide assurance that the 
NRTL's testing and certification process is reliable.
    To satisfy the approval requirement when an employer uses a product 
in the workplace, the NRTLs generally must approve the product for the 
manufacturer before the manufacturer initially sells or ships the 
product. An NRTL performs two major functions in the product-approval 
process: Testing and certification. First, the NRTL tests a 
representative unit or prototype of the product to ensure it meets the 
requirements of the applicable product safety-test standard(s). For 
this purpose, the NRTL may rely on testing that it conducted, or it may 
accept testing performed by parties that the NRTL qualifies for that 
purpose. These parties typically include independent testing 
laboratories, but also may include the product's manufacturer, which 
results in time and cost savings for a qualified manufacturer. Second, 
the NRTL authorizes the manufacturer to apply the NRTL's mark on the 
product, indicating that the product meets the requirements of the 
appropriate test standard(s). To ensure that the product continues to 
comply with the applicable requirements, and that the manufacturer is 
conducting production-line tests on the product required by the test 
standard(s), the NRTL will conduct follow-up inspections on a regular 
basis at each of the product manufacturer's factories or assembling 
facilities. NRTLs typically conduct these follow-up inspections two to 
four times per year at each facility. The NRTL may use a contractor 
under the NRTL's control to conduct these inspections.
    OSHA's NRTL Program recognition process involves a thorough 
analysis of an NRTL applicant's policies and procedures, and a 
comprehensive onsite review of the applicant's testing and 
certification facilities, to ensure that the applicant meets these 
requirements. OSHA's staff also conduct annual onsite audits at each 
NRTL's facilities to ensure that the NRTLs adequately perform their 
testing and certification activities, and maintain the quality of these 
operations. Thus, through the NRTL Program, OSHA ensures that a 
qualified, independent testing laboratory certifies the equipment 
before it reaches the market.
    In adopting the program's requirements, OSHA found that 
implementation of these criteria and procedures would ``assure no 
diminution of worker safety.'' (53 FR 12103.) Since implementation, 
OSHA received no evidence challenging this conclusion or the conclusion 
that the NRTL product-approval requirements provide the high degree of 
worker protection required by the OSH Act.

D. Overview of the EU's SDoC System \7\
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    \7\ Except as noted, the information in this section comes from 
the summary of the October 11, 2007, information-exchange meeting 
between OSHA and EC representatives (Ex. OSHA-2008-0032-0004) and 
research by OSHA staff.
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    The Low Voltage Directive (``LVD'' or ``Directive'') determines 
which products are covered by the EC's SDoC system for electrical 
safety (Exhibit OSHA-2008-0032-0017); the EC implemented it in 1973 to 
promote the free movement of goods across the EU. (The LVD does not

[[Page 79039]]

apply to goods exported to countries outside the EU.) Directives are 
laws binding on the Member States enacted by the European Council and 
European Parliament. Generally, under the EU's system, the EC proposes 
these laws. (More information on these institutions and their functions 
is available at http://europa.eu/index_en.htm.) The LVD covers all 
equipment between 50 and 1,000 volts AC, and 75 and 1,500 volts DC, 
except as specifically excluded in Annex II of the LVD. This annex 
lists, among other types of equipment, ``electrical equipment for use 
in an explosive atmosphere, those for radiology and medical purposes, 
and those for goods and passenger lifts.'' The lower and upper limits 
of the LVD were set to exclude electrical equipment of the 
telecommunication industry and electric-power industries, respectively. 
The EC's proposal asserts that all products covered under the LVD in 
the EU are ``low-risk'' because electrocutions have become rare in the 
EU since implementation of the LVD; the EC concludes that the low rate 
of electrocutions demonstrates the effectiveness of the EC's SDoC 
system. In general, the conformity-assessment approach used in the EU 
classifies products according to eight categories, with requirements 
ranging from the least stringent (Module A) to the most stringent 
(Module H). Module A, covering only the purportedly lowest-risk 
products, is the only category to which SDoC alone applies, i.e., 
without other and stronger regulatory controls. (See Exhibit OSHA-2008-
0032-0015 for an illustration of the safety requirements for products 
covered by each module.)
    The Member States enforce the LVD through post-market surveillance. 
Each EU Member State must enact national laws to implement the LVD, and 
assign at least one agency (the ``surveillance authority'') to enforce 
these laws. In the United Kingdom, for example, approximately 250 local 
government agencies perform this function, whereas in other countries, 
one agency or one part of an agency may fill this role. The 
surveillance authority's inspections are a critical activity. Among the 
EU countries, the type and number of inspections vary depending on the 
number of available inspectors, the level of funding, and the type and 
number of problems prevalent in the Member State. Some Member States 
base inspections primarily on complaints and accidents, while other 
Member States base inspections primarily on a random selection of 
products. (See Exhibit OSHA-2008-0032-014, p. 40.) Once an inspection 
identifies a potential deficiency, the surveillance authority may 
require the manufacturer, if known, to submit to the authority a report 
by an independent testing organization (referred to as a ``notified 
body'' in the EU) demonstrating that the product conforms to the 
applicable test standard. For products that do not conform, the 
manufacturer must perform a risk assessment and propose corrective 
actions. Ultimately, the surveillance authority makes a final decision 
on risk, which can vary substantially across countries. The authority 
then decides what remedial action to take, which may include a product 
recall, ban, quarantine, or confiscation; assessing financial 
penalties; and, in more serious cases, assessing criminal penalties. If 
the authority cannot locate the manufacturer or its authorized 
representative, the authority may hold the retailer (or other party 
that places the product in that Member State's market) responsible, and 
impose the remedial action on that party.
    For products posing immediate safety risks and affecting more than 
one Member State, the EU has a rapid alert system (RAPEX). Another 
notification system, ICSMS, also serves this purpose, but not every EU 
Member State uses ICSMS. The goal of recently promulgated EU 
legislation is to harmonize the notification systems used by the Member 
States.
    Manufacturers must maintain technical files of products covered 
under the LVD for at least 10 years ``after the last product has been 
manufactured.'' Under the LVD, a technical file must contain evidence 
that the product complies with the applicable safety standards or other 
requirements, either through accredited tests, or through other 
evidence such as a manufacturer's comprehensive safety analysis of the 
product's design. Bodies called ``European Standardisation 
Organisations'' (ESOs) are responsible for developing and maintaining 
the technical safety specifications for the products (commonly referred 
to as the ``product safety test standard'' or ``test standard''). In 
addition, market-surveillance authorities accept products that conform 
to the ESO standards as being in compliance with the LVD. If challenged 
by a Member State's surveillance authority, a manufacturer must prove 
that it complied with the LVD, either by demonstrating compliance with 
the ESO standard or by other means. If the manufacturer is unknown, the 
burden of demonstrating compliance passes to the importer, which can be 
liable for penalties and applicable fines. However, there is no 
requirement that manufacturers or importers register with any Member 
States, making it difficult in some cases to identify the responsible 
party.
    EU Member States cannot add safety-related requirements to the LVD. 
The LVD is binding on each Member State, which must codify it into 
national laws. If a Member State does not properly implement the LVD 
through legislation, it must nonetheless accept products declared by 
the manufacturers to comply with the Directive unless available 
evidence demonstrates that the products are noncompliant. Each Member 
State is responsible for imposing fines on manufacturers or importers 
for noncompliance with the LVD.

E. The EC's Formal Proposal

    In its statement of March 2008 (Exhibit OSHA-2008-0032-0005), the 
EC called for OSHA to adopt an SDoC system, and supplemented this 
statement in its June 2008 rationale (Exhibit OSHA-2008-0032-0008), 
which formally requested that OSHA ``review its conformity assessment 
procedures in the area of electrical and electronic products.'' 
According to the March 2008 statement, the EC advocated an SDoC system 
because it believes third-party conformity assessment of ``low-risk 
electrical and electronic products'' in the U.S. ``imposes unnecessary 
additional costs and market-entry barriers on exporters of these goods 
* * * .'' The statement describes the types of products the EC 
considers to be outside the scope of its `` `low-risk electrical and 
electronic product' definition,'' such as ``electrical equipment for 
use in an explosive atmosphere, * * * for radiology and medical 
purposes, * * * [and] electricity meters, plugs, and socket outlets for 
domestic use * * * .'' The statement noted that such products present a 
level of risk that makes SDoC an inappropriate means of conformity 
assessment under EU law, and that the EU requires the use of third-
party approvals in such cases.
    In its June 2008 rationale, the EC noted that it has extensive 
experience with conformity-assessment regimes that do not require 
manufacturers to obtain third-party certification. The EC based its 
choice of an SDoC regime on its ``assessment of the risk to consumers, 
workers and the general interest that non-compliant products would 
reach the market place that would pose danger.'' The EC then concluded 
that the risks for these products ``are at a level that they can be 
satisfactorily managed by obliging manufacturers to demonstrate 
compliance and to keep such proof at the disposal of public

[[Page 79040]]

authorities for inspection at all times.'' According to the EC 
statement, such rules, along with product liability law, consumer 
protection legislation, and appropriate enforcement measures guarantee 
a high level of safety for European consumers.
    Also in the June 2008 rationale, the EC contends that OSHA's third-
party requirements cause an ``imbalance in market access regimes 
governing transatlantic trade in electrical products,'' and an 
``imbalance in market access for the certification industry as U.S. 
certifiers can without any barrier offer their services to U.S. 
industry to comply with EU rules, whereas EU certifiers require either 
recognition as an NRTL by OSHA or be accepted as a test house by 
NRTLs.'' \8\ According to the EC, these requirements increase the 
likelihood that countries importing products from the U.S. and the EU 
will establish different forms of testing and approval. The EC asserted 
that having OSHA adopt an SDoC system ``is justified by the fact that 
European consumers and workers experience a high if not higher level of 
electrical safety as their counterparts in the U.S.'' It attributes 
this effect in part to ``the high level of safety of electrical and 
electronic devices.'' Moreover, the EC contends that ``[s]tatistics 
furthermore demonstrate that accidents can seldom be attributed to 
products, but are normally the result of `live' wires and neglect. 
Where they can be attributed to products, there are no indications that 
in the EU there is a relationship between non-compliance and 
incidents.'' Finally the EC claims that ``market mechanisms ensure that 
most electrical and electronic products and especially high technology 
products and high volume products follow rigid quality controls and 
have an excellent record of compliance.''
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    \8\ See discussion under section IV of this notice.
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F. OSHA's October 20, 2008, Request for Information on SDoC

    In the 2008 RFI, OSHA posed 45 questions to elicit information OSHA 
needed to decide whether to initiate rulemaking to allow an SDoC system 
for ensuring a high degree of safety for electrical products in the 
workplace. OSHA stressed the importance of ``specific detailed 
scientific, technical, statistical or similar data and studies, of a 
credible nature, supporting any claims made by commenters.'' (73 FR 
62327.) OSHA requested information and comments from all interested 
parties on the issues raised in the RFI, or any other issues the public 
deemed relevant for OSHA's consideration.
    In addition, OSHA specifically noted that the EC's proposal and 
rationale lacked sufficient evidence to support its contention that the 
safety risk of noncompliance was low under its LVD. Accordingly, in the 
2008 RFI, OSHA requested evidence to support the EC's assertion that 
European consumers and workers ``experience a high if not higher level 
of electrical safety as their counterparts in the U.S.'' without the 
safeguards required under the NRTL Program. (See 73 FR 62331 (quoting 
Exhibit OSHA-2008-0032-0008).) OSHA noted that it would need data in 
support of the EC's assertions regarding the safety of its SDoC system 
to enable OSHA to determine whether adopting an SDoC system in the U.S. 
would provide U.S. workers with the high degree of worker protection 
required by the OSH Act.
    During the 90-day comment period, OSHA received 74 comments in 
response to the RFI. The relevant issues raised in these comments are 
discussed in Section III of this notice.

III. Summary of Findings

    As noted earlier, two conceptual approaches applicable for 
evaluating the safety of a conformity-assessment system, such as SDoC, 
are: (1) An evaluation of statistics concerning the system's safety 
record, and (2) an evaluation of the operations and elements of the 
system. In subsections A and B of this section, OSHA analyzes the 
evidence \9\ submitted using each of these approaches. OSHA finds that 
the record does not support the conclusion that, under either approach, 
SDoC would provide a high level of worker protection against the 
hazards of electrical equipment in U.S. workplaces.
---------------------------------------------------------------------------

    \9\ When multiple commenters raised a similar issue discussed in 
this notice, OSHA addresses the issue, but does not necessarily 
identify every commenter that raised the issue.
---------------------------------------------------------------------------

    The remainder of Section III addresses other arguments about SDoC 
raised in the record. Specifically, OSHA addresses alternative 
approaches recommended by commenters (subsection C), arguments relying 
on manufacturer-certification schemes used for other products in the 
U.S. (subsection D), arguments based on post-market surveillance 
required under each of the schemes (subsection E), and the costs of 
administering an SDoC system (subsection F). As discussed in detail 
below, OSHA decided that the record does not justify initiating a 
rulemaking to adopt SDoC for assuring the safety of electrical products 
used in the workplace.

A. Statistical Evidence Concerning Workplace Safety Under an SDoC 
System

    No commenter submitted valid statistical data to the record, nor 
did OSHA find any such data, that demonstrate that SDoC presented the 
low risk claimed by its proponents. Indeed, commenters agreed that data 
do not exist, either in the U.S. or in Europe, to accurately 
differentiate between the safety of electrical equipment approved by a 
third party and products not approved by a third party. (See, e.g., 
Exhibits OSHA-2008-0032-0044.1 at 8, 25; OSHA-2008-0032-0019; OSHA-
2008-0032-0031.1; OSHA-2008-0032-0089.1; OSHA-2008-0032-0092.1.)
    Moreover, the limited EU and U.S. workplace statistics that are 
available, while not conclusive, raise concerns about the relative 
safety of an SDoC system. For the year 2005, the most recent available 
for both jurisdictions, U.S. Bureau of Labor Statistics show that 510 
private-sector employees had injuries that caused them to be away from 
work for three or more days from ``contact with electric current of 
machine, tool, appliance, or light fixture.'' \10\ A total of 1,960 
employees had injuries causing them to be away from work for three or 
more days for ``contact with electric current.'' According to EC's 
Directorate General for Employment, Social Affairs, and Equal 
Opportunities, a total of 1,584 employees sustained injuries at work 
causing them to be away from work for more than three days from 
``electrical problem due to equipment failure,'' and a total of 5,510 
employees sustained the same degree of injuries from ``direct contact 
with electricity, receipt of electrical charge in the body.'' European 
Commission, Directorate-General for Employment, Social Affairs, and 
Equal Opportunities, Causes and Circumstances of Accidents at Work in 
the EU, at 172-73 (2009) (``DG Report''; available at http://ec.europa.eu/social/main.jsp?catId=787&langId=en (last accessed 7/20/
10) (hereafter EU Workplace Statistics Report).
---------------------------------------------------------------------------

    \10\ These statistics are taken from the Bureau of Labor 
Statistic's database of Occupational Injuries and Illnesses and 
Fatal Injuries Profiles, which may be accessed at http://data.bls.gov:8080/GQT/servlet/InitialPage (last viewed 7/20/10).
---------------------------------------------------------------------------

    BLS statistics show that, in 2005, there were roughly 111 million 
private-sector employees in the U.S. See BLS Employment Situation, July 
2005 & December 2005 (available at http://www.bls.gov/schedule/archives/empsit_nr.htm#2005, last accessed on 7/20/10). These 
statistics yield an incidence rate per 100,000 workers of 0.46 for

[[Page 79041]]

equipment-related electrical injuries (>=3 days lost), and 1.76 for all 
electrical injuries (>=3 days lost). The corresponding population of EU 
workers is more difficult to determine because the DG Report gives 
numbers ranging from 106 million to 183 million, EU Workplace 
Statistics Report at 117; however, using the most favorable number for 
the EU, this yields an incident rate per 100,000 workers of 0.87 
injuries (> 3 days) due to ``electrical problem due to equipment 
failure,'' and 3.01 injuries (>3 days) due to direct contact with 
electricity. These data are summarized in Table 1 below.

      Table 1--U.S. Private-Sector and EU Electrical Injuries 2005
------------------------------------------------------------------------
                                                             Injuries/
                                             Injuries      100,000 wkrs
------------------------------------------------------------------------
U.S.--Contact with electric current of               510            0.46
 machine, tool, appliance, or light
 fixture, (private-sector injuries >= 3
 days away from work)...................
U.S.--Contact with electric current,               1,960            1.76
 (private-sector injuries >= 3 days away
 from work).............................
EU--Electrical problem due to equipment            1,584            0.87
 failure, (injuries > 3 days lost)......
EU--Direct contact with electricity,               5,510            3.01
 receipt of electrical charge in the
 body, (injuries > 3 days lost).........
------------------------------------------------------------------------

    There are obvious problems involved with directly comparing the 
above data. BLS based this data on a survey of employers required to 
record occupational injuries on logs maintained for this purpose; the 
EU statistics are a compilation of member country data which is 
collected, depending on the country, either from insurance claims or 
reports by employers adjusted to account for non-reported injuries. The 
EU records only data concerning injuries that result in more than three 
days lost; the published U.S. data include injuries resulting in three 
or more days lost. It is unclear whether the EU classification 
``electrical problem due to equipment failure'' is equivalent to the 
U.S. category ``Contact with electric current of machine, tool, 
appliance, or light fixture.'' Regardless, the numbers do not directly 
measure injuries due to nonconforming electrical products. Nonetheless, 
the fact that the EU workplace electrical injury \11\ rates for 2005 
were nearly twice the rates for the U.S. suggests caution in 
considering whether to adopt the EU's electrical-product conformity 
scheme.
---------------------------------------------------------------------------

    \11\ The EU report also gives a fatality number, but it is 
difficult to interpret because it is given for the period 2003-05. 
The number of member states reporting deaths for these 
classifications varied over this period, and, thus, these numbers 
are not comparable to the U.S. data. See EU Workplace Statistics at 
118.
---------------------------------------------------------------------------

    Other injury data submitted to the record also gives OSHA pause. 
The EC submitted the statistics from the European Injury Database 
(IDB), which compiled accident and emergency data from ``selected 
member state hospitals'' in Austria, Denmark, France, and Sweden for 
2002-05, and from the UK and Ireland for 2002. (Exhibit OSHA-2008-0032-
0044.1, Annex 5.) The IDB data show substantial numbers of injuries 
related to the use of consumer electrical products which are subject to 
a SDoC system: 6,115 injuries involving all electrical products, and 
1,721 injuries involving ICT products. Although its methodology is not 
clear, the EC claims that, at most, 1,243 injuries involved electrical 
product nonconformance, and 325 injuries involved nonconforming ICT 
equipment.\1/2\ These are substantial numbers, especially given the 
limited geographic and temporal scope of the data; accordingly, these 
numbers do not support moving to an SDoC system.
---------------------------------------------------------------------------

    \12\ The EC submission does not directly state the total number 
of accidents in the IDB. However, Annex 5 of the EC submission 
states that the 1,721 accidents attributed to ICT equipment 
constitute 0.18% of the accidents in the IDB, indicating that the 
total number of accidents was 956,111 (i.e., 0.0018 x 956,111 = 
1,721). The EC argues that these data should be analyzed as a 
percentage of all injuries, rather than an absolute number. OSHA 
does not agree with this argument because a small percentage of 
injuries may mask the magnitude of the injuries, which is best 
expressed as an absolute number. OSHA is concerned about the risk 
posed by electrical equipment, not the comparison of electrical 
equipment injuries to other types of injuries in the EU.
---------------------------------------------------------------------------

    The remaining statistical evidence provided by commenters was 
unconvincing. Although some proponents claimed that the data they 
submitted supported the safety of SDoC, they failed to submit source 
data or published studies to verify the statistics they cited. (See, 
e.g., Exhibits OSHA-2008-0032-0041.1 and OSHA-2008-0032-0051.) In 
addition, commenters often failed to explain adequately the methodology 
underlying the statistics they provided. (See, e.g., OSHA-2008-0032-
0053.1.) Commenters also failed to address the limitations that OSHA 
described in Section IV of the 2008 RFI with respect to some items of 
information it previously received. For example, they failed to address 
adequately how SDoC controls the risks associated with non-compliant 
products. (See, e.g., OSHA-2008-0032-0089.1.) Consequently, as 
discussed below in further detail, OSHA found unconvincing the data 
submitted to the record supporting the safety of products under an SDoC 
system.
    An example of an unsupported claim in the record was a statement by 
the EC that the only electrical product to cause a fatal accident in 
the EU in the last 10 years was a steam iron tested by a third party, 
but modified during production, (Exhibit OSHA-2008-0032-44.1 at 8, 25). 
This comment did not explain what databases or records it searched to 
locate information about deaths from electrical products, nor is it 
clear that the EU surveyed all of the available sources of data. 
Published workplace statistics, noted above, show that EU workers had 
thousands of non-fatal accidents in 2005, and hundreds of fatal 
accidents between 2003 and 2005 related to contact with electricity or 
other electrical problems. (See EU Workplace Statistics Report at 172-
73) Further, the steam-iron incident highlights the fact that the EU's 
SDoC system is not designed to prevent defective products from reaching 
the market because the surveillance authorities conduct few, if any, 
factory inspections to ensure that manufacturers continue to comply 
with the applicable safety requirements before products are sold or 
shipped. This point is discussed further in subsection II.B.1 below.
    The EC also pointed to RAPEX data as evidence of ``pre-emptive'' 
measures taken by EU Member States to remove noncompliant products from 
the market. (Exhibit OSHA-2008-0032-44.1 at 8-9.) The EU's RAPEX is a 
system used by market-surveillance authorities to report sales bans, 
recalls, or orders to modify products they have issued. EU Member 
States use RAPEX for a number of ``non-food consumer products,'' but do 
not typically use it for products having mainly industrial or 
commercial purposes. Member States also do not use RAPEX for 
notification of noncompliant products when ``the effects do not or

[[Page 79042]]

cannot go beyond the territory of a Member State * * *.'' (Exhibit 
OSHA-2008-0032-0017.) As a result, Member States may judge a number of 
actions that are of interest to OSHA to be outside the scope of RAPEX 
and, thus, not report them. Therefore, RAPEX results likely do not 
accurately capture the problems associated with some products, 
particularly products used in the workplace. Further, these 
notifications represent instances of noncompliant products reaching the 
market. As discussed in more detail below, this is a central feature of 
the EU's SDoC system that raises critical concerns for OSHA: an SDoC 
system detects nonconforming products only after products reach the 
market. These RAPEX data do not demonstrate that the EU's reactive SDoC 
system has the necessary elements to provide a high degree of worker 
protection for electrical safety in the U.S. workplace.
    Several commenters cited a graph showing the number of fatalities 
from electrical incidents in the U.S. and Germany as evidence that such 
incidents are decreasing more rapidly in the EU than in the U.S. (See, 
e.g., Exhibits OSHA-2008-0032-0044.1, Annex 4; OSHA-2008-0032-0045.1; 
OSHA-2008-0032-0054.1; OSHA-2008-0032-0060.1; OSHA-2008-0032-0087.1.) 
However, as OSHA noted in the 2008 RFI, ``[t]he source of the data does 
not appear to be readily available in the U.S., the actual numbers of 
electrocutions per year and a stratification by causes are not provided 
in the graph, no reason is given why more recent data were not 
obtained, and it is unclear whether the data are normalized for the two 
populations.'' (73 FR 62320.) No commenters responded to these issues.
    The Confederation of Danish Industry, while conceding that the 
question of whether SDoC is less safe than a third-party system is 
``difficult to answer,'' provided information showing that accidents 
with electrical equipment and installations trended downward from 1998 
to 2007. (Exhibit OSHA-2008-0032-0089.1.) Similarly, a report from the 
Swedish National Electrical Safety Board provided statistics showing 
that the ``number of products possessing a serious criticism risk has 
[been] reduced and the number of sales bans [also] have [been] 
reduced'' from 1996 to 2006. (Exhibit OSHA-2008-0032-0092.1.) However, 
these statistics do not address directly the safety of these products 
in terms of fatalities and injuries, and, therefore, do not demonstrate 
that SDoC provides a sufficient level of worker protection to satisfy 
the requirements of the OSH Act.
    Finally, several commenters argued that ICT equipment presents a 
low risk of workplace injuries. (Exhibits OSHA-2008-0032-0019; OSHA-
2008-0032-0031.1; OSHA-2008-0032-0041.1; OSHA-2008-0032-0057.1.) The 
submitted data, however, did not adequately support this position. For 
example, a joint ICT industry submission presented numerous statistics 
demonstrating a decline in fatalities, injuries, and illnesses in U.S. 
workplaces since 1972 (although illness data would appear to be 
irrelevant), and also showing a relatively low rate of incidents 
associated with ICT equipment in the U.S. (Exhibit OSHA-2008-0032-0019, 
p.3.) These data do not demonstrate the safety of an SDoC system 
because OSHA required NRTL approval of electrical products in U.S. 
workplaces for most of the time period involved; the data instead 
appear to support the effectiveness of the NRTL Program in preventing 
workplace fatalities and injuries. As another example, the Federation 
of French Electrical Electronic and Communication Industry stated that 
``Certain product groups * * * are in many cases inherently safe,'' 
(Exhibit OSHA-2008-0032-0041.1, p.7) but provided no technical or other 
information to justify its claim.
    Hewlett-Packard Company stated that ``the data currently under the 
product category `computer equipment' available on the United States 
Consumer Product Safety Commission (CPSC) Web site indicates there has 
not been a single recall for desktop personal computers, workstations, 
or servers dating back to 1990.'' (Exhibit OSHA-2008-0032-0031.1) This 
statistic, however, covers only a narrow subset of ICT equipment, and 
excludes laptop computers and computer peripherals such as printers, 
scanners, monitors, and fax machines. A review of CPSC recalls for ICT 
equipment between 2003 and March of 2009 shows a total of 60 product 
recalls, including laptop computers, scanners, monitors, printers, 
computer speakers, fax machines, and telephones. (See http://www.cpsc.gov/cpscpub/prerel/prerel.html.) Included with these recalls 
were reports of electric shock and product overheating that resulted in 
property damage and personal burns. (Id.) Moreover, in March 2009 
(shortly after the 2008 RFI comment period closed), there was a recall 
of a desktop personal computer for overheating as a result of short 
circuiting; the overheating melted internal components and the external 
casing. (Id.)
    In sum, the record contains no statistically sound evidence 
demonstrating that an SDoC system provides a high degree of protection 
for electrical safety in the workplace, and what evidence there is 
raises concerns that the SDoC system may be less protective than the 
NRTL system.

B. Analysis of the Components of an SDoC System

    OSHA carefully reviewed the elements of the SDoC system. OSHA's 
analysis concluded that, for electrical safety, the system does not 
provide the high level of worker protection required by the OSHA Act. 
This statement would apply to any similar SDoC system. As explained in 
more detail below, OSHA determined that SDoC's protection is reactive, 
and, therefore, is less likely than the NRTL Program to find 
nonconforming products before the products reach the market. In 
addition, an SDoC system does not provide assurance that manufacturers 
are appropriately certifying products because it lacks an assessment of 
the manufacturers' competence, independence, and production control.
1. SDoC as a Reactive System
    A substantial problem with SDoC is that it appears to allow 
nonconforming products to reach the market. While OSHA designed the 
NRTL Program to detect product noncompliance before products reach the 
market, the SDoC system is reactive in that its principal means of 
protection, post-market surveillance, relies on authorities to verify 
the adequacy of testing only after products reach the market, or worse, 
after an incident that causes injury or death. In addition, such 
product verification is done for only for a limited number of products 
by surveillance authorities. As a result, post-market surveillance 
provides a lower degree of assurance that products, in general, are 
conforming and safe.
    Several studies noted in the 2008 RFI highlighted problems with 
``portable luminaires'' (i.e., portable lamps) and extension cords in 
the European market. (Exhibits OSHA-2008-0032-0011; OSHA-2008-0032-
0012.) The SDoC system in the EU allowed these products to reach the EU 
market. The Low Voltage Directive Administrative Cooperation (LVD 
AdCo), an ``independent Working Group run and chaired by the Member 
States'' conducted the studies, with the Working Group described as ``a 
forum for co-operation and exchange of information between national 
market surveillance authorities.'' (Exhibit OSHA-2008-0032-0011.) In 
2006, LVD AdCo organized its first cross-border market-surveillance 
project, a multi-country cooperative and coordinated

[[Page 79043]]

effort involving surveillance authorities from 15 Member States.
    The first of these studies targeted portable luminaires in part 
because these products ``are relatively cheap to purchase,'' thus 
making this project feasible for ``member states with small [market-
surveillance] budgets.'' (Id., p.6.) These products also had a large 
number of problem notifications as shown in a chart depicting past 
``safeguard clauses and RAPEX notifications.'' (Id.) The study results 
show that manufacturers were placing noncompliant products on the 
market. The study evaluated a total of 226 luminaires for conformance 
to applicable administrative and technical requirements. (Id., p.4.) Of 
this total, 38% originated in the EU, 23% originated from China, 10% 
originated from other countries outside of the EU, and 29% had no 
country of origin specified. (Id., p.15.) The study found that 72% 
(162) of the luminaires failed one or more of the technical 
requirements, nearly half (74) of which contained ``serious'' technical 
hazards, and 23% (53) of which had administrative nonconformities 
(missing ``CE'' marks, missing or incorrect technical files, missing or 
incorrect declarations of conformity, and similar problems). (Id., p. 
17.) According to the report of the study, the results obtained ``do 
not give a dependable estimate of the percentages [of] non-compliant 
luminaires on the market.'' (Id., p. 18.) However, the report indicates 
that the results of the project are consistent with the experiences of 
several EU Member States. (Id., p. 19.) A summary of the report states:

    Many companies appear to neglect assuring conformity with the 
administrative requirements in the Directive. Declarations of 
conformity and technical files were often not available or did not 
fit the luminaires themselves. The LVD prescribes module A for 
conformity assessment, which amounts to self-certification by the 
manufacturer or importer into the EU. The choice for module A was 
made because of the relatively minor hazards associated with 
electrical products. However, the new and global approach is based 
on the assumption that the actors comply with the conformity 
assessment procedures before CE-marking the product in order to 
assure safe products on the markets. For fragmented markets like the 
one for luminaires, this assumption does not appear to be valid, if 
the results of this and previous national actions are indeed 
indicative.

(Id., p. 19.) The report lacks any analysis of the underlying causes 
for the high rate of nonconformities found.
    The second study addressed extension cords. A press release 
provided a summary of the study's results. (Exhibit OSHA-2008-0032-
0012.) The press release indicated that 20 EU Member States 
participated in the study and tested 210 extension-cord sets. The 
results of the study showed that only one in six extension-cord sets 
fully complied with the LVD and the General Product Safety Directive 
(GPSD) requirements. (The GPSD specifies requirements for general 
consumer products used in the EU.) Although the noncompliant samples 
included products that exhibited only administrative failures, the 
authorities considered approximately 58% of the extension-cord sets to 
be sufficiently unsafe to justify a sales ban or product recall.
    Both the luminaire and extension-cord studies show the difficulties 
that arise when moving to a system which depends so heavily on post-
market surveillance for enforcement. When unscrupulous or incompetent 
manufacturers do not ensure that products meet the applicable safety 
standard, the first line of protection for workers does not occur until 
after the product reaches the market. In contrast, a third-party 
certification system is structured to find and correct such errors 
before manufacturers place the products on the market. In response to 
the discussion of these studies in the 2008 RFI, several commenters 
reiterated that the luminaire and extension-cord studies were not 
representative of typical rates of noncompliance for electrical 
products on the European market because the studies did not select 
luminaires and extension cords randomly for evaluation. (See, e.g., 
Exhibits OSHA-2008-0032-0044.1; OSHA-2008-0032-0051; OSHA-2008-0032-
0053.1; OSHA-2008-0032-0054.1; OSHA-2008-0032-0060.1; OSHA-2008-0032-
0076.1.) Rather, the studies targeted luminaires and extension cords 
for evaluation because, in part, these products had high levels of 
noncompliance with SDoC requirements. (Id.) Whether these studies are 
broadly representative of SDoC noncompliance rates misses the point--
which is that the data on luminaires and extension cords raise serious 
concerns for OSHA about the safety of the EU's SDoC system. These 
studies make clear that SDoC allowed significant numbers of 
nonconforming products to reach the market. Although the EC alleges 
that no incidents occurred because of these defective products, the 
studies concluded that nearly half of the luminaires tested had 
``serious'' technical hazards, and 58% of the extension-cord sets 
tested were sufficiently unsafe to justify a sales ban or product 
recall. (Exhibits OSHA-2008-0032-0011, p. 17; OSHA-2008-0032-0012.) The 
EC also attempted to minimize the importance of these studies by noting 
that the studies addressed products that were inexpensive and involved 
low-level technology. (Exhibit OSHA-2008-0032-44.1.) This rationale 
seems to be a concession that manufacturers engaged in producing such 
items are less likely to ensure product conformity under an SDoC. OSHA 
cannot ignore the risks posed by these products when evaluating a 
conformity-assessment scheme. These data raise serious questions about 
whether an SDoC system would assure a high degree of protection for 
U.S. workers. We note that commenters presented no studies 
demonstrating that the rates of nonconforming products in the EU are 
low.
    OSHA also reviewed a document prepared by EC staff (Exhibit OSHA-
2008-0032-0013) which provided details about the EU's market-
surveillance system, and served as the basis for associated legislation 
that the EU was considering. This document covers a wide range of 
issues in a number of areas in which the EU's system needs improvement. 
Under ``What are the Problems to Tackle,'' the report states, 
``Experience with the implementation of [European] Community 
legislation in the area of free movement of goods has highlighted 
certain weaknesses and shown that the effectiveness of the system can 
still be improved.'' (Exhibit OSHA-2008-0032-0013, p. 12.) The document 
states further:

    It is generally noted that the enforcement of EU product 
legislation is unsatisfactory and a considerable number of non-
compliant (and potentially dangerous) products reach the market. The 
share of non-compliant products can only be estimated and the 
situation differs very much from sector to sector and from Member 
State to Member State.

(Id., p. 19.) This statement partially corroborates the findings in the 
report on luminaires, which indicated that the high level of 
nonconformities results from difficulties Member States have enforcing 
the LVD. In this regard, the staff document notes, ``Currently, market 
surveillance does not operate effectively throughout the [European] 
Community. * * *'' (Id., p. 20.) The document continues, ``In practice 
market surveillance authorities often experience difficulties in 
identifying the person who has actually manufactured and/or supplied 
the products * * *.'' (Id., p. 23.) This EC document highlights the 
reliance of its SDoC system on post-market surveillance, and 
underscores

[[Page 79044]]

the risks to workers that would result without an adequate enforcement 
scheme.
    In its proposal, the EC suggested that reliance on product 
liability laws would provide some assurance that an SDoC system 
functioned properly. However, none of the commenters demonstrated that 
such laws would contribute significantly to ensuring that an SDoC would 
provide a high degree of worker protection for electrical safety in the 
workplace. As noted by one commenter, liability laws would not be an 
effective deterrent against foreign manufacturers, and any remedy 
``depends on the injured or damaged party(ies) having knowledge, 
resources, evidence, time, and desire to initiate and follow through 
with legal action * * *.'' (See OSHA-2008-0032-0072.1.) As noted in the 
comment, any injuries would occur before invoking the laws, which would 
not provide a high degree of worker protection.
2. Competence and Independence of Testing Organizations, and Production 
Control by Manufacturers
    Under the EU's SDoC system, the parties performing product testing 
do not have to demonstrate, either initially or continually, competence 
in determining whether a tested product complies with the applicable 
standard. Without assurance of competence, OSHA questions the degree to 
which that testing will be performed appropriately. Similarly, a 
manufacturer performing product certification has a financial interest 
in the profitability of the product, which provides an incentive for 
self-dealing when a manufacturer self-certifies its products. Although 
OSHA recognizes that many manufacturers would test products 
appropriately, it is concerned that allowing SDoC would increase the 
probability that at least some manufacturers would test products 
poorly, which would cause unsafe products to enter the workplace. In 
addition, the EU's SDoC system has no requirement for monitoring 
product design changes and for retesting products periodically to 
ensure continued safety. More importantly, no comparable requirement 
exists to perform multiple annual inspections at critical points of 
control (i.e., every factory making a certified product) to ensure that 
the products conform to the testing requirements.
    Underwriters Laboratories (UL), an NRTL and standards-developing 
organization, submitted data to illustrate some of these issues. UL 
stated that ``in a sampling of more than 25,000 investigations [of 
equipment installed in the field without third-party certification] 
carried out by UL, 63% of products reviewed had safety deficiencies.'' 
(Exhibit OSHA-2008-0032-0072.1.) In addition, UL reported for eight 
industries the percentage of products that failed to comply with the 
applicable standard when UL tested the products initially: 31% for 
appliances, 24% for components, 24% for insulating materials, 14% for 
fire protection equipment, 24% for industrial equipment, 16% for 
information technology equipment, 45% for lighting, 39% for power 
distribution equipment, and 34% for wires and cables. (Id.) UL cites 
these statistics as the basis for its estimate that ``at least 20% of 
the products submitted to [UL] on a global basis would likely have been 
placed on the market with non-conformances if UL had not reviewed 
them.'' (Id.) Although UL did not explain the methodology it used to 
obtain these results, the data illustrate the risk to electrical safety 
that could result when products are not tested appropriately.
    The American Council of Independent Laboratories (ACIL) also 
submitted similar data. (Exhibit OSHA-2008-0032-0037.1.) ACIL is a 
national trade association representing ``independent scientific 
laboratory, testing, consulting, product certifying, and R&D firms; 
manufacturers' laboratories; and consultants and suppliers to the 
industry.'' (Id.) ACIL responded to OSHA's concerns, expressed in the 
2008 RFI, that ACIL did not explain the methodology behind the data it 
submitted in response to the 2005 RFI. (Exhibit OSHA-2008-0032-0037.1.) 
In its comment for the 2008 RFI, ACIL explained that it presented data 
indicating a high level of nonconformance among initial product 
submissions made by manufacturers to its member laboratories. (Id.) 
ACIL also explained that these data came from a survey of its member 
laboratories. (Id.) To clarify its earlier submission, ACIL presented, 
in response to the 2008 RFI, updated data from a recent survey in which 
six of its member laboratories participated. (Exhibit OSHA-2008-0032-
0037.2.) In conclusion, the ACIL and UL data raise the question of 
whether manufacturers are qualified to determine whether products 
conform to the applicable product-safety test standards.
    The EC took issue with the implication that ACIL's initial 
submission data demonstrate that an NRTL system provides a higher level 
of safety than an SDoC system:

    We have heard arguments from the NRTLs that argue that, since 
substantial percentages of products fail the safety tests they 
perform, an SDoC system is likely to lead to substantial percentages 
of non-compliance. This rationale is not substantiated. Our reading 
is that during product development, manufacturers have prototypes 
evaluated in order to see whether they would meet safety standards. 
Also under an SDoC system, manufacturers would do such testing and 
would correct designs, when they would not pass. Manufacturers that 
intend to comply with the legislation will only market products that 
have passed such tests.

(Exhibit OSHA-2008-0032-0044.1, p. 6.) The EC does not, however, cite 
any data to support its assumption that manufacturers would be just as 
likely as NRTLs to detect and correct defects before putting a product 
on the market. OSHA believes that such an assumption is less likely to 
be appropriate when, as a general rule, the manufacturer may be 
unqualified to perform testing, lacks independence, and has financial 
incentives that could override the need to identify defects. However, 
OSHA recognizes that some manufacturers would take the necessary 
actions to test products appropriately.
    The comment submitted by Bureau Veritas Consumer Products Services 
(BVCPS) further reinforce OSHA's concerns regarding SDoC.\13\ (Exhibit 
OSHA-2008-0032-0038.1.) BVCPS asserted, ``It is our experience based on 
testing over 5000 products per year in Asia with CE marking and FCC 
regulatory requirements that high levels of non compliance exceeding 
50% exist.'' (Id., p. 1.)\1/4\ Although this statement is anecdotal, 
and not necessarily statistically valid, it nevertheless suggests that 
the SDoC system allows significant numbers of nonconforming products to 
reach the market. These data raise serious concerns regarding whether 
an SDoC system would provide a high degree of worker protection 
required by the OSH Act. Whereas, the NRTL Program detects product 
noncompliance before products reach the market, the luminaire and 
extension cord studies exemplify the main drawback of an SDoC system--
that it detects noncompliant products only after products reach the 
market, and, therefore, fails to provide workers with a high degree of 
protection. The data in the record submitted by the EC and

[[Page 79045]]

others supporting an OSHA transition to SDoC fail to show that, despite 
these large numbers of noncompliant products on the market in the EU, 
the EU's reactive SDoC system is as safe as OSHA's proactive NRTL 
Program.
---------------------------------------------------------------------------

    \13\ BVCPS is a testing laboratory accredited under the IECEE CB 
scheme that conducts technical folder reviews to determine CE 
compliance of European-based retailers having Asian supply chains. 
The IECEE CB scheme provides for health and safety testing through 
the IECEE (IEC System for Conformity Testing and Certification of 
Electrotechnical Equipment and Components).
    \14\ BVCPS recommended modifying the NRTL system rather than 
transitioning to an SDoC system. OSHA addresses this recommendation 
below.
---------------------------------------------------------------------------

    OSHA also received a comment from CSA International, an NRTL and 
provider of certification and testing services, which raised further 
concerns about the safety of the SDoC system. (Exhibit OSHA-2008-0032-
0049.1.) This comment quoted from the Fourth Report of the Baltic Sea 
Network 2008 \15\ (See http://www.hamburg.de/contentblob/749300/data/kooperationsbericht-vierter-2008.pdf):
---------------------------------------------------------------------------

    \15\ The Baltic Sea Network is a cooperative effort among market 
surveillance authorities in Denmark, Estonia, Finland, Germany, 
Latvia, Lithuania, Poland, and Sweden. The Network is co-financed by 
the EC.

    To date, market surveillance activities within the Baltic Sea 
Network have usually been carried out on the basis of the Low 
Voltage Directive and/or PPE Directive. The ratio of faulty products 
is at a constantly high level for all product groups. About one-
third is without defects and formal faults and about two thirds of 
the examined products show more or less serious failures. 5-10% of 
the checked products exhibit failures that are so severe that a 
serious danger to consumers cannot be ruled out. In the case of 
electric equipment this means the possibility of an electric shock 
---------------------------------------------------------------------------
or household fire because of the defective electrical outfit.

(Id., p. 2.) The report does not provide source data for these 
statistics or an explanation of the underlying methodology. Yet, these 
numbers serve as anecdotal evidence of serious safety concerns 
associated with the EU SDoC system.
    In sum, the record lacks credible evidence sufficiently 
demonstrating that SDoC would provide a high degree of worker 
protection. Before revising its regulations, OSHA must determine, on 
the basis of substantial evidence, that the revised regulations would 
provide U.S. workers with a high degree of protection for electrical 
safety. Therefore, OSHA concludes that the lack of sufficient evidence 
counsels against revising its regulations to implement an SDoC system 
for the approval of electrical products used in U.S. workplaces.

C. Proposed Alternatives

    A number of commenters proposed that OSHA modify its NRTL Program 
instead of transitioning to an SDoC system. (See, e.g., Exhibits OSHA-
2008-0032-0038.1; OSHA-2008-0032-0097.1.) These commenters suggested 
that OSHA retain its NRTL Program, but broaden it to recognize 
certifications issued by National Certification Bodies (NCBs) under the 
IECEE CB scheme. However, these commenters identified the incorrect 
scheme: the scheme that involves acceptance of such certifications is 
the IECEE Full Certification Scheme (FCS). While OSHA does not directly 
accept the certifications of NCBs, and currently has no plan to do so, 
it allows NRTLs to use testing reports from these bodies when issued 
under the IECEE CB Scheme.\16\
---------------------------------------------------------------------------

    \16\ In this regard, OSHA notes that the EU also does not 
directly accept NCB certifications; however, at least one Member 
State designated the NCB as a notified body. Unlike NRTLs, EU 
notified bodies must reside in the country that authorizes them.
---------------------------------------------------------------------------

    The ICT industry proposed a parallel NRTL-SDoC system that would 
allow manufacturers to use SDoC as an alternative to certifying 
products through the NRTL Program. OSHA will not initiate rulemaking to 
propose a parallel SDoC system for the same reason it is rejecting the 
EC proposal for a stand-alone SDoC system: the evidence in the record 
does not demonstrate that an SDoC system would provide a high degree of 
protection to U.S. workers.
    ITI (Ex. OSHA-2008-0032-0057.1) also submitted a comment proposing 
an alternative to the NRTL Program in which manufacturers would have 
products tested by an NRTL, or a third-party organization operating 
under the IECEE CB Scheme; the manufacturers then would certify the 
products through SDoC. This proposal would retain third-party testing, 
but eliminate the post-testing NRTL certification requirements. 
Importantly, this alternative would exclude: (1) Initial follow-up 
inspections of each manufacturing facility to verify that the products 
resulting from production runs conform, or will conform, to the 
applicable test standard's requirements; and (2) subsequent follow-up 
inspections to ensure that the product currently manufactured at the 
facility and bearing the NRTL's mark is identical to the product the 
NRTL tested and certified. As OSHA explained in the preamble to the 
1988 rule establishing the NRTL Program, an NRTL's continued oversight 
of products the NRTL certified serves important OSHA goals. (See 53 FR 
12107.) A similar suggestion was made by the Technology Association of 
America (Exhibit OSHA-2008-0032-0043.1) to allow the testing to be done 
by a third-party organization accredited under the International 
Laboratory Accreditation Cooperation (ILAC) Scheme. ITI and the other 
commenters are suggesting an alternative without the critical 
requirement for factory inspections. These commenters did not submit 
information to the record showing that this alternative, absent post-
testing inspections of manufacturers' facilities, would provide U.S. 
workers with a high degree of protection. Also, before relying on these 
schemes, OSHA must first determine that organizations accredited under 
these schemes are as effective in testing products as laboratories 
granted recognition under the NRTL Program.
    Phillips Electronics also suggested that OSHA ``allow manufacturers 
to apply for OSHA recognition to conduct specific product testing, but 
continue to seek certification from a recognized NRTL.'' (Ex. OSHA-
2008-0032-67.1.) This suggestion would require OSHA to operate a 
recognition program for manufacturers, similar to the NRTL Program, 
that would ensure that manufacturers are qualified to perform the 
testing, and to verify that they do so consistently and appropriately. 
OSHA would need to undertake rulemaking to adopt such a program. OSHA 
believes that such a program would have to impose stringent 
requirements on manufacturers trying to gain accreditation to, in part, 
counter their self-interest in the product. However, OSHA is unsure at 
this time what these requirements would be or whether they would be 
effective. Further, OSHA would have to resolve technical issues, such 
as verifying the adequacy of initial product testing and identifying 
and testing product changes. Obtaining and maintaining adequate and 
trained staff for such a program would be difficult, especially if 
numerous manufacturers participated in the program. OSHA could fund the 
program by charging manufacturers fees for program-related activities 
performed by OSHA, similar to the fees OSHA currently charges NRTLs. 
These fees, however, may be larger for manufacturers than NRTL fees, 
depending on the extent of OSHA's activities.
    Phillips' suggestion has merit because it proposes to retain 
factory inspections by NRTLs. It is unclear, however, whether NRTLs 
would perform these inspections; NRTLs may be reluctant to do so 
because they would not be conducting initial testing of the products 
and, thus, have no assurance that the products meet test standards. If 
NRTLs do not perform inspections, OSHA would have to perform them to 
assure conformance with test standards, thereby adding to OSHA's 
staffing and funding burden.
    OSHA believes that a manufacturers' accreditation program would not 
be favored by SDoC proponents, and, as noted above, such a program 
would be

[[Page 79046]]

resource intensive for OSHA to administer. Further, it is unclear 
whether OSHA could implement the program in a way that preserves the 
high degree of worker protection currently afforded to workers by the 
NRTL program. In light of these concerns, OSHA will not undertake 
rulemaking to propose such a program.
    OSHA notes again that it currently permits NRTLs to accept testing 
conducted by non-NRTL testing laboratories, including laboratories 
operated by manufacturers, as part of the NRTL certification process. 
This testing can provide time and cost savings to manufacturers. (See 
Nationally Recognized Testing Laboratories; Clarification of the Types 
of Programs and Procedures, 60 FR 12980 (March 9, 1995).) NRTL 
acceptance of such testing is voluntary because OSHA's regulations do 
not require that NRTLs accept testing from any party. However, for an 
NRTL to accept these test data, OSHA must issue an approval for the 
NRTL to use one or more ``supplemental programs,'' which are another 
segment of the NRTL Program. OSHA recognizes most NRTLs for these 
supplemental programs. One of these programs allows NRTLs to accept 
testing conducted by a testing laboratory accredited under the IECEE CB 
Scheme, while another program allows an NRTL to use other parties to 
perform the post-testing inspections of manufacturers' production 
facilities provided the NRTL retains responsibility for the 
inspections. An NRTL meeting the regulatory requirements for capability 
and independence may use these programs provided the NRTL preserves 
ultimate responsibility for approving the product and authorizing use 
of its NRTL mark. (Id.)

D. Use of SDoC in the U.S.

    Several commenters suggested that, because several U.S. agencies 
use SDoC for automobiles and personal protective equipment (PPE), OSHA 
also should permit SDoC for electrical equipment used in the workplace. 
(See, e.g., Exhibits OSHA-2008-0032-0041.1; OSHA-2008-0032-0043.1; 
44.1; OSHA-2008-0032-0057.1.) OSHA does not find this argument 
persuasive.
    As OSHA explained in the 2008 RFI, the authority of the National 
Highway Transportation Safety Administration (NHTSA), which regulates 
automobile safety, is different from OSHA's authority to regulate the 
workplace. For example, the NHTSA's inspection authority appears to 
have a broader geographical scope than OSHA's authority. (Compare 29 
U.S.C. 657(a)(1) with 49 U.S.C. 30166(c)(3).) In addition, the OSH Act 
at 29 U.S.C. 658(a) gives OSHA authority to cite employers for 
violations of the Act and its implementing regulations, and to impose 
related penalties; however, the National Traffic and Motor Vehicle 
Safety Act at 49 U.S.C. 30163(a) allows the Department of Justice to 
seek an injunction in U.S. District Court to enjoin the sale of 
defective or nonconforming motor vehicles and equipment. OSHA does not 
appear to have the authority to enjoin manufacturers from producing 
unsafe electrical products, and no commenter provided a legal argument 
contrary to this conclusion. Thus, significant statutory differences 
exist between OSHA's authority to regulate electrical products in the 
workplace and NHTSA's authority to regulate motor vehicles and 
equipment under an SDoC system. Congress would need to revise this 
authority significantly for OSHA to perform functions similar to the 
functions NHTSA performs. Currently, no justification exists for such a 
revision.
    Additionally, the automobile industry differs from the electrical 
products industry in important ways. For example, a small number of 
large, well-known manufacturers dominate the automobile industry. The 
group remains fairly constant. In contrast, the electrical products 
industry consists of a large number of manufacturers that may vary in 
size and that operate, for some product types, in a highly fluctuating 
market. These manufacturers can be small and based abroad, making 
regulatory interventions difficult. In addition, automobiles are 
extremely expensive to recall compared to most low-voltage electrical 
products. Thus, the incentives for manufacturers are different in the 
two sectors: the risks of a product defect are much greater for a 
large, well-known manufacturer of expensive automobiles than they are 
for a small, relatively anonymous manufacturer of inexpensive 
electrical products. Third-party certification is more important for 
electrical products than for automobiles because the incentives to 
overlook or ignore testing requirements are higher for manufacturers of 
electrical products than for automobile manufacturers.
    With respect to PPE, visual inspection by the user or compliance 
official generally can confirm compliance. In contrast, a typical user 
or inspector of electrical equipment is not in a position to inspect 
and evaluate the safety of its electrical components. Furthermore, OSHA 
recently conducted rulemaking to clarify the standards for PPE in the 
workplace (see 74 FR 46350), and none of the commenters suggested that 
OSHA require third-party approval of PPE. Therefore, PPE and electrical 
products have different characteristics, and these differences support 
the need for third-party approval of electrical products.

E. Post-Market Surveillance in NRTL v. SDoC Systems

    Several commenters suggested that post-market surveillance is 
equally important in an NRTL system as in an SDoC system. (See, e.g., 
Exhibits OSHA-2008-0032-0041.1; OSHA-2008-0032-0044.1; OSHA-2008-0032-
0045.1; OSHA-2008-0032-0051; OSHA-2008-0032-0053.1; OSHA-2008-0032-
0057.1.) For example, the EC argued:

    [I]n any market there are ``willing'' also [sic] ``non-willing'' 
market players. Both the U.S. and the EU are faced with counterfeits 
and rogue market players that ignore rules that are in place. This 
implies that governments, independent of the conformity assessment 
rules they put into place, need to have an infrastructure to detect 
non-compliant products and to take effective action against market 
players that place non-compliant products on the market so as to 
enforce the rules.

(Exhibit OSHA-2008-0032-0041.1, p. 6.) OSHA agrees that counterfeit 
products are a potential problem under both SDoC and NRTL systems. This 
problem, however, is more difficult to address under an SDoC system 
than under the NRTL Program. Under an SDoC system, the burden of 
conducting market surveillance to detect counterfeit marks would fall 
on a government agency. In contrast, under the NRTL Program, each NRTL 
may conduct market surveillance to assure that manufacturers use only 
its mark on certified products, i.e., each NRTL is responsible for 
ensuring the integrity of its mark.
    OSHA believes that market surveillance is an important means that 
NRTLs can use to detect counterfeit products. Several NRTLs also 
collaborate with the U.S. Customs Service to monitor for counterfeit 
products imported into the U.S. Therefore, shifting to an SDoC system 
would impose market surveillance obligations on OSHA to monitor for 
counterfeit marks, which would require additional funding and staff 
resources; however, OSHA may obtain funding for such a program, in 
whole or part, by charging fees to manufacturers or exporters.
    OSHA raised the issue of authority in the 2008 RFI, stating it 
believes that implementation of SDoC may require revisions to its 
statutory authority. Revised statutory authority appears to

[[Page 79047]]

be necessary because OSHA lacks the authority to adopt many of the 
post-market enforcement measures essential to ensuring electrical 
safety under an SDoC system, including product recalls, bans, and 
confiscation. Based on OSHA's analysis of the record, no justification 
exists for revisions to OSHA's current statutory authority.

F. The Costs of Administering an SDoC System

    In the 2008 RFI, OSHA estimated that implementing an SDoC system in 
the U.S. could cost the Agency approximately $360 million annually. In 
contrast, the current budget associated with operating the NRTL Program 
is approximately $1 million per year. Based on this estimate, operating 
an effective SDoC program would require OSHA to incur substantial 
additional costs. OSHA's current budget for all of its operations is 
about $558 million. Thus, based on OSHA's estimate, adopting an SDoC 
system would increase OSHA's entire current budget by more than half.
    OSHA asked four specific questions in the 2008 RFI regarding costs 
associated with administering an SDoC program. (See 73 FR 62337.) 
However, the cost information submitted to the record failed to rebut 
OSHA's determination in the 2008 RFI that administering an SDoC system 
would be significantly more expensive than operating the NRTL Program. 
(See Exhibits OSHA-2008-0032-060.1, OSHA-2008-0032-062.1, OSHA-2008-
0032-071, OSHA-2008-0032-092.1.) Extrapolating from data provided by 
one commenter (i.e., a cost of $10 million dollars for every 5 million 
inhabitants; OSHA-2008-0032-071), an SDoC system in the U.S. could cost 
at least $600 million for approximately 300 million inhabitants. None 
of the respondents described the methodology used to determine the 
resources necessary to operate an SDoC system, including the number of 
inspectors required. The record only shows that most EU countries have 
fewer than ten inspectors devoted to enforcement of the LVD.
    The substantial additional cost associated with an SDoC system 
would be problematic for OSHA because Congress may not fund the system 
adequately, thereby reducing the level of post-market inspections 
required and jeopardizing worker protection. As noted in an EC staff 
document, inadequate budgets significantly reduce the level of market 
surveillance performed by some EU countries. (Exhibit OSHA-2008-0032-
0013.) Jeopardizing worker protection because of inadequate funding 
would violate OSHA's statutory mandate to provide workers with a high 
degree of protection.

IV. Effects on Trade

    The EC based its request that OSHA move to a SDoC system on its 
claim that the NRTL Program is a barrier to trade, and many other 
commenters echoed this view. In this section, OSHA provides its 
analysis of this issue.
    The 2008 RFI contained three questions related to trade. Most 
commenters in favor of SDoC maintained that OSHA's requirements are a 
trade barrier, and that OSHA should adopt SDoC to facilitate trade. 
(See, e.g., Exhibits OSHA-2008-0032-0041.1; OSHA-2008-0032-0044.1; 
OSHA-2008-0032-0045; OSHA-2008-0032-0051; OSHA-2008-0032-0057.1; OSHA-
2008-0032-0060.1.) Interestingly, one SDoC proponent stated that SDoC 
does not have a trade advantage over third-party approvals because 
``most manufacturers rely on third party tests in any case.'' (See 
OSHA-2008-0032-0053.1.)
    OSHA believes that its NRTL Program is not a barrier to trade 
because the third-party certification requirements apply to all covered 
products used in the workplace, regardless of the country in which the 
products originated. In addition, OSHA's NRTL Program is equally 
accessible to both U.S. and foreign-based organizations. In this 
regard, several NRTLs currently have headquarters or facilities in 
foreign countries. In contrast to the NRTL system, when the EU requires 
third-party certification (e.g., for products excluded from the LVD), 
it does not permit foreign-based certification bodies to certify 
products for the EU market. Therefore, to comply with the EU's third-
party certification requirement, a U.S. certifier must register as an 
EU-based Notified Body for acceptance of any of its certifications in 
the EU, whether its certifications are for a U.S. manufacturer or a 
manufacturer from another country. This requirement contradicts the 
EC's claim in its rationale (Exhibit OSHA-2008-0032-0008) that U.S. 
certifiers could ``without any barrier offer their services to U.S. 
industry to comply with EU rules.''
    Although the EC contends that OSHA's method of approval is an 
unnecessary obstacle to trade, OSHA never received information from the 
EC or any other source adequately explaining how the NRTL requirements 
constitute such an obstacle.\17\ Further, based on evidence submitted 
in the record, OSHA finds that implementing an SDoC system for 
electrical safety would increase the risk that unsafe products will 
enter the workplace and harm workers because such a system cannot 
control these risks effectively to provide the requisite level of 
worker protection. Therefore, OSHA concludes that the NRTL requirements 
are reasonably necessary to provide a high degree of worker protection 
required by the OSH Act.
---------------------------------------------------------------------------

    \17\ Some statements by SDoC proponents (e.g., asserting that 
the NRTL Program causes redundant testing, time burdens, and high 
costs (see, e.g., OSHA-2008-0032-0057.1)) are incorrect, not 
adequately demonstrated, or unfounded. On the contrary, the NRTL 
Program contains flexibilities that avoid or reduce duplication, 
delays, and costs.
---------------------------------------------------------------------------

    Another argument put forth by proponents of SDoC is that the NRTL 
Program forces other countries to develop similar programs, which 
proponents view as burdensome. OSHA rejects this argument because the 
Agency does not attempt to influence other countries in these 
decisions. Each country determines the methods it considers appropriate 
for its purposes. Countries are free to adopt SDoC when they find it is 
appropriate. In making this argument, proponents appear to be saying 
that these countries are more confident in a third-party system than in 
SDoC. Also unconvincing is the EC's assertion that OSHA must adopt SDoC 
because the EU grants U.S. manufacturers access to the EU market 
without the need for third-party approval. However, this argument 
implies that, if a country adopts a trade measure for its purposes, 
then all countries must reciprocate, even if such action is 
inappropriate.

V. Concluding Remarks

    OSHA requested information on the SDoC system to better understand 
and corroborate the statements the EC made when proposing that OSHA 
adopt an SDoC system. The record shows that the EU adopted SDoC to 
serve its safety and trade needs by harmonizing the different practices 
that existed among the Member States prior to joining the EU. As stated 
in the EC's rationale, the EU based its decision to adopt the SDoC 
system on its ``assessment of the risk to consumers, workers and the 
general interest that non-compliant products * * * [reaching] the 
market place * * * would pose danger.'' (Exhibit OSHA-2008-0032-008, p. 
1.) The EU then concluded that, for these products, the ``risks are at 
a level that they can be satisfactorily managed'' by SDoC. (Id.) As the 
record shows, the EU failed to provide statistics or numerical analysis 
to support this assessment.

[[Page 79048]]

    In conclusion, OSHA is not initiating rulemaking to permit the use 
of an SDoC as an alternative to OSHA's current NRTL Program for 
approving electrical products for use in the workplace. By statute, 
OSHA must demonstrate, based on substantial evidence, that its safety 
regulations and standards will provide or maintain a high degree of 
protection for U.S. workers. The evidence in the record does not meet 
the burden required for OSHA to revise its standards to accommodate an 
SDoC system for electrical safety in the workplace. OSHA finds that 
such a revision would increase the risk that unsafe products will enter 
the workplace and harm workers because an SDoC system cannot control 
these risks effectively to provide the requisite level of worker 
protection. In addition, Congress would need to authorize and fund OSHA 
to regulate and enforce product-related activities of manufacturers, 
distributors, and retailers. The evidence in the record submitted in 
response to the 2008 RFI does not justify an expansion of, or funding 
for, OSHA's regulatory and enforcement authority for the purpose of 
implementing an SDoC system. However, notwithstanding this decision, 
OSHA remains open to discuss concerns regarding the NRTL Program, as 
well as means that may be available to mitigate the concerns expressed 
by the EC and other pro-SDoC commenters, provided these means are 
within the limits of OSHA's authority, funding, and staffing.

VI. Authority and Signature

    David Michaels, PhD, MPH, Assistant Secretary of Labor for 
Occupational Safety and Health, 200 Constitution Avenue, NW., 
Washington, DC 20210, directed the preparation of this notice. This 
action is taken pursuant to sections 4, 6, and 8 of the Occupational 
Safety and Health Act of 1970 (29 U.S.C. 657), Secretary of Labor's 
Order No. 5-2007 (72 FR 31159), and 29 CFR Part 1911.

    Signed at Washington, DC on December 13, 2010.
David Michaels,
Assistant Secretary of Labor for Occupational Safety and Health.
[FR Doc. 2010-31695 Filed 12-16-10; 8:45 am]
BILLING CODE 4510-26-P


