Rumor has it that the CPSC staff will soon be sending up to the Commission suggestions for “modernizing” the §6(b) regulations (16 CFR 1101) dealing with disclosure of company and product-specific information. “Modernizing” is a word that covers a lot of ground and it will be instructive to see how the agency staff and commissioners define it.
The §6(b) regulations were written in 1983 and do not, for example, contemplate communication by email—hence the perceived need for modernization. But if the Commission’s recent proposal with respect to voluntary recalls—where significant substantive changes are being proposed under the rubric of “tweaking” an interpretive rule—are any indicator, then interested stakeholders should pay close attention to the proposed §6(b) rule when it comes up for Commission review.
§6(b), along with §15(b) and the voluntary recall process are three legs of the stool that supports a collaborative and cooperative relationship between the Commission and product sellers. This cooperation, in large part, is what makes the agency as effective as it is. §15(b) requires submission of information indicating a product hazard, but most companies, up to now, heed the oft-stated advice of “when in doubt, report”, reporting information before, or even absent, the statutory obligation. This happens because §6(b) protects the disclosure of information that is not fair or accurate. (Here is a link to an article that discusses the consumer protection aspects of §6(b).) Taken together, the statute provides incentives for companies to give information to the agency earlier than they otherwise would because those companies have the assurance that information about specific products will be used internally but will not be prematurely released to the public, before the agency has determined if there is a problem. The voluntary recall process compliments this statutory framework by allowing recalls to be made quickly and, in some cases, before there is a determination that a substantial hazard does, in fact, exist.
The important role that §6(b) plays in making the statute work is not appreciated by some within the agency. That is unfortunate. If the Commission decides to use this proposed §6(b) modernization rule as an opportunity to make more substantial changes (as it did with the voluntary recall proposed rule), it threatens to further erode the foundation of cooperation that is so vital to an effective CPSC.