Attention Apparel and Accessories Manufacturers: CPSIA Effective Date Delayed

Why You Still Should Be In Compliance

Fashion Law Alert

February 2009

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On January 30, 2009, the Consumer Product Safety Commission (CPSC) granted a one-year stay of enforcement of the newly passed Consumer Product Safety Improvement Act (CPSIA) of 2008. This act, previously scheduled to go into effect on February 10, 2009, requires that any shipment of a product intended for children under 12 be accompanied by a certificate of compliance stating that the goods meet new and heightened requirements with respect to lead content. Additionally, the act limits the amount of lead contained in any accessible part of children's products to 600 parts per million (ppm). Under the CPSIA, a “children's product” is a product primarily designed, marketed to or intended for children ages 12 or under.

In addition, the act prohibits the sale of certain children's products if they contain more than 0.1 percent of certain specific phthalates or if they fail to meet new mandatory standards for toys.

Even though enforcement of the law was stayed until February 10, 2010, many retailers are still requiring certification of compliance with the act, so check with each vendor for updated individual requirements. Companies also should consult a professional before responding to retailers' requests for certification to make sure they do not waive any rights or make any commitments not required by law.

Also, while the government does not currently require that companies test each style and certify compliance, it does required makers of children's products to meet the mandatory lead and phthalate limits. At minimum, companies should ensure that each of their suppliers provide certification that the component they produce complies with the CPSIA standards. We urge companies to use this time wisely: evaluate inventory and supply chain. When the law goes into effect companies should be prepared by having a strategic plan.

To comply with CPSIA, all manufacturers, both importers and domestic manufacturers, MUST:

1. TEST: All children's products must be tested by an accredited third party.
   1. Even though a manufacturer may use the same fabric or embellishments on a variety of styles, each style must be separately tested since different types of dye, paint, glitter and rhinestones can equate to a different lead content. Note that the cost to test and lead times vary, so a testing program, if required, should be implemented as soon as possible.
   2. A list of accredited third parties can be found on the CPSC's webpage at http://www.cpsc.gov/cgi-bin/labapplist.aspx.
   3. Currently, the waiting time for product testing is 7-21 days, without the payment of rush fees to accredited testing companies.
   4. Costs range from $75-$900 per SKU for third-party testing, without rush fees.
2. CERTIFY: All children's products shipped on or after February 10, 2010, must be “accompanied” by a certificate issued by the domestic manufacturer or importer.
   1. The certificate must provide various details including, but not limited to:
      1. the product covered by the certificate
      2. the rule applicable to the product
      3. the name and address of the manufacturer or importer
      4. the name and address of the person responsible for maintaining testing records
      5. the date the product was manufactured (at least month and year)
      6. the date and location of the third-party testing
      7. the name and address of the tester
   2. A certificate of compliance may physically accompany the shipment or may be posted electronically on the web, if the certificate for each shipment has a unique URL and is created in advance of the goods being placed into commerce.
3. LABEL: After August 14, 2010, manufacturers must affix a permanent label on their product so that the ultimate purchaser can ascertain, inter alia, when and where the product was manufactured and tested.
   1. Providing this information merely on hangtags and adhesive labels is insufficient.
   2. Also, on August 14, 2010, the permissible amount of lead drops to 300 ppm.

Effects on Manufacturers and Inventory for Non-Compliance

1. After February 10, 2010, all existing inventory, both held by the manufacturer or on a retailer's shelf, that contains more than 600 ppm of lead will be treated as a banned “hazardous substance” under the Federal Hazardous Substances Act.
2. The sale of non-conforming goods is per se illegal, and harsh civil penalties, up to $100,000 per violation, will apply.
3. In general, non-conforming inventory must be destroyed.

It is strongly recommended that manufacturers review their strategic and financial plans to ensure compliance with the Act. Companies should consult a professional to help evaluate the impact of the new law on products and to assist in updating internal procedures and contracts as soon as possible.

For further information, contact Staci Jennifer Riordan at sriordan@foxrothschild.com or 310.598.4180.