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Hazardous Substance Strategy: Volume Two

Executive Summary

1 Introduction

2 Environmental and Tolerable Exposure Limits

3 Research on Hazardous Substances

4 Substances Imported for Export Only

5 Improving Compliance Monitoring and Enforcement

6 Data Protection Issues

7 New Pathways

8 Regulatory Impact Statement - Data Collection

9 Having Your Say

10 Glossary

Appendix 1: How Environmental and Tolerable Exposure Limits are Set

Appendix 2: Issues with the Exempt Laboratories Regulations

5 Improving Compliance Monitoring and Enforcement

This chapter describes six proposals for improving the hazardous substance compliance monitoring and enforcement regime:

• requiring HSNO approval numbers on labels
• providing for enforcement agencies, when doing HSNO work, to use powers of entry and inspection that they have under other legislation
• providing for a register of test certificates
• giving ERMA the power to revoke an approved handler test certificate
• ensuring that if an unapproved substance is imported, it must be re-exported
• taking a fresh look at HSNO systems to report hazardous substance-related injuries.

We will now look at each of these proposals in detail.

5.1 HSNO approval numbers on labels

The Hazardous Substance (Identification) Regulations 2001 require that a hazardous substance be identified by a common name, a chemical name or a registered trade name. This information is then stored on the ERMA Hazardous Substances Register. The register is available on the ERMA website (www.ermanz.govt.nz).

Users of the register could potentially include:

• Customs officers checking consignments at the border
• test certifiers applying the HSNO regulations
• enforcement officers checking compliance with HSNO controls
• members of the public wanting to know more about a particular product
• companies wanting to know that trade competitors have complied with HSNO requirements.

There has been a call for an amendment to the law to require that an HSNO approval code also be shown on the label to make it easier to find the substance on the ERMA register. The number of substances on the register is growing rapidly. While it can be searched by entering the trade name (unique identifier), this is not always the same as the common name, especially for branded products. Some people simply want reassurance that a substance/product is HSNO-approved and, for them, searching a register is an unnecessary step. This is particularly likely to be an issue during transfer.

The purpose of the register is to provide evidence that a substance/product has been approved in order to assist compliance efforts, and any change to include an approval number would need to have safeguards to prevent anyone using it to trace the details of the original ERMA decision for commercial purposes. For instance, it may be that the original applicant would be allocated one number and subsequent users of the approval another.

In any event, this policy will require an amendment to the HSNO regulations. The detail of the system would be consulted on in the context of policy for regulation amendment.

There appears to be wide support for this change, but there are compliance cost implications. For the policy to deliver the expected benefits, all users of an approval would have to display the HSNO approval number on the label, not just the original applicant for the approval. Thus, generic manufacturers/marketers of 'image' products would need to display an HSNO number.

The cost of designing and printing labels is not insignificant. Allowing a transition period for old labels to be used up could perhaps mitigate this problem. Another option would be the use of a stick-on number to be placed on top of the existing label until old stocks were used up.

Lastly, there are issues concerning imported hazardous substances. Substances imported in bulk are not labelled as such, but a requirement to quote an HSNO number could be applied to supporting documentation. Imported consumer products are sometimes labelled in the country of origin. It is proposed that importers/wholesalers would be required to comply before sale within New Zealand rather than before importation. As a result, re-labelling in New Zealand might be necessary.

5.2 Powers of entry and inspection

As discussed in Volume 1, section 97 of the HSNO Act lists the agencies that are to enforce the Act and the places or subject areas for which they are responsible. The roles were designed to ensure maximum overlap with existing agency functions, thereby making best use of resources and avoiding numerous overlapping or conflicting compliance activities and enforcement actions by multiple agencies.

Consistent with this approach, it was also originally intended that, wherever possible, enforcement agencies were to enforce HSNO controls using their existing powers under their existing legislation.

A breach of the HSNO Act may not necessarily be a breach of the enforcement agency's primary legislation (and vice versa). In such a case, the enforcement agency must take action for the breach under the appropriate legislation, using that Act's powers of inspection and enforcement. This may present difficulties if there are significant differences in the powers of inspection or enforcement between the HSNO Act and the agency's primary legislation.

In particular, the HSNO Act powers of entry and inspection distinguish between inspections:

• for the purpose of assessing compliance (section 103 of the HSNO Act)
• where an enforcement officer has reasonable grounds to believe that an offence has been committed under the HSNO Act and wishes to obtain evidence of that offence, which requires a search warrant (section 119 of the HSNO Act).

This distinction means that if an enforcement officer has reasonable grounds to believe an HSNO offence has been committed and wants to obtain evidence of that offence, the officer cannot use the compliance inspection power of entry and inspection, but must first obtain a search warrant (section 119). Also, the powers of entry and inspection under section 103 can be used only for the purpose of assessing compliance and must not be used longer than is necessary for that purpose. If during a compliance assessment an enforcement officer has reasonable grounds to believe there is an HSNO breach, the officer should not continue the inspection simply to get further evidence of that offence, but should instead consider getting a search warrant.

For some enforcement agencies, this approach is very similar to that of their own legislation, such as the territorial authorities operating under the RMA. However, for other agencies the approach is very different. For example, the Department of Labour's Occupational Safety and Health Service (OSH) operates under the Health and Safety in Employment Act 1992, which does not distinguish between proactive inspections to assess compliance and reactive inspections in response to a possible breach, but simply provides inspectors with general powers of entry and inspection. As a result, under the Act OSH inspectors have flexibility to respond to a wide variety of health and safety issues that may arise during a workplace visit, including the ability to respond immediately to breaches with appropriate enforcement action and to gather evidence to support enforcement action without having to stop to obtain a search warrant.

It is proposed that the HSNO Act be amended to provide that section 97 enforcement agencies can exercise the powers of entry and inspection under their own legislation when carrying out their responsibilities as an enforcement agency under the HSNO Act. This is consistent with the original intent of enforcement by section 97 agencies. It is also consistent with the Hazardous Substances Strategy by contributing to improving the workability of HSNO.

5.3 Register of test certificates

An important part of the approval and compliance regime for hazardous substances is the requirement that test certificates be obtained for equipment and locations where hazardous substances are used and held, and that people handling certain hazardous substances are certified. The Act provides that test certifiers be responsible for issuing these test certificates.

While there is a requirement in the Act for test certifiers to keep records of the certificates they issue, there is no obligation to make this information available to ERMA (or anyone else).

A centralised register of the information contained in test certificates would help:

• ERMA to deliver its statutory overview functions
• enforcement agencies to know what certificates have been issued and where hazardous substances are located in their area - enforcement agencies cannot at present easily validate claims that a certificate is held by a handler or a location.

In the past, local authorities have used the information provided through dangerous goods licences for planning, resource consents and land information memoranda (LIMs) purposes. Unless a central register is maintained, local authorities will no longer have access to this information.

Recognising the utility of such information, ERMA now requires test certifiers to provide information to ERMA on the test certificates they issue as a condition of their approval. Some test certifiers argue that there is no explicit statutory requirement to provide that information in the HSNO Act. In any event, there will potentially still be gaps in the ERMA register because the first test certifiers were not required to provide information to ERMA.

We therefore propose that ERMA have explicit statutory authority to require the following information from test certifiers:

• the affected site
• the nature and status of the certificate
• the certificate's date of issue and expiry.

This information could be placed on a publicly searchable register.

5.4 Revoking an approved handler test certificate

ERMA appoints test certifiers under section 84 of the Act. The test certifiers then have the duty to issue test certificates to approved handlers under section 82. At present an approved handler is granted a test certificate for five years, at which point a renewal must be sought from a test certifier. Section 86 sets out when a test certifier's approval may be revoked by ERMA but not when an approved handler's certificate may be cancelled.

There are a number of circumstances in which an approved handler test certificate should possibly be revoked, including when:

• an approved handler is shown to be incompetent
• the information used in support of an approved handler application was later found to be false or misleading
• the person has been convicted of a criminal offence of a kind that calls into question competence to be an approved handler.

We propose that ERMA have the ability to cancel a test certificate. What is proposed here is a mechanism for approved handlers similar to the current section 86 provisions that apply to test certifiers (only). Section 86 reads:

86. Complaints to Authority - (1) If the Authority receives any complaint about, or has cause to query the conduct or ability of a test certifier the Authority may investigate the complaint or query and, if it considers the complaint or query to be justified, may amend or cancel the approval.

5.5 Ability to require an importer to re-export

Section 122 of the HSNO Act provides that where a Customs officer has reasonable cause to believe that a hazardous substance is being imported in breach of the Act, the officer may direct that the hazardous substance remain on the ship or aircraft and leave New Zealand.

Typically Customs will not be aware of the shipment until after it has been offloaded from the ship or aircraft. Once the goods have been offloaded, Customs is not able to use the current section 122 to direct that the importer re-export the goods. In a situation where hazardous substances that do not have an ERMA approval are offloaded, Customs can still use powers under the Customs and Excise Act to seize the goods. The difficulty is that seized goods become the responsibility of the Crown, with Customs being responsible for their storage and disposal.

It is proposed the importer should have a clear responsibility for re-exporting unapproved hazardous substances whether the goods are intercepted before or after being offloaded. This would provide added assurance that hazardous substances not covered by an approval do not remain in New Zealand.

5.6 Under-reporting of hazardous substance injuries

Section 143 of the HSNO Act requires notification of all hospital admissions from hazardous substance injuries by the person in charge of the hospital to the medical officer of health. This requirement was derived from section 76 of the Toxic Substances Act 1979, which required notification of all hospital admissions from poisoning. The definition of hazardous substances includes some substances that were previously not notified, such as explosives, and the term 'injury' also widens what was previously notified.

It is thought likely that there is significant under-reporting of injuries, and that part of the reason for this is inadequacies in HSNO notification and reporting provisions. Present provisions do not include presentations to a general practice or accident and emergency clinics, including after-hours clinics. General practice is the more likely place of care rather than emergency departments for all but the most serious injuries. Even attendances at hospital emergency departments are excluded if 'admission to hospital' is interpreted narrowly as at least being an overnight stay.

There are at least three options for addressing the issue of inadequacies in the Act:

• require all diagnosing medical practitioners to notify hazardous substance injury
• make explicit that 'admission to hospital' also includes hospital attendances rather than just overnight stays
• abandon notification as the method of obtaining monitoring information in favour of methods such as health surveys or sentinel general practice surveillance (this might still require a legislative mechanism to enable HSNO enforcement officers appointed by the Ministry of Health to take appropriate action to protect public health).