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HCFC Regulations Amended to Reflect Restrictions on Trade with Developing Countries

Wednesday, March 26, 2014
Sandler, Travis & Rosenberg Trade Report

The Environmental Protection Agency has issued a direct final rule that updates its regulations to reflect restrictions on trade in hydrochlorofluorocarbons with developing countries that took effect Jan. 1, 2013. This rule also updates the Harmonized Tariff Schedule numbers for ozone-depleting substances to address changes made in 2012 by the International Trade Commission. This rule will be effective as of June 24 unless the EPA receives adverse comment by April 25.

Signed in 1987, the Montreal Protocol on Substances that Deplete the Ozone Layer is an international agreement aimed at reducing and eventually eliminating the production and consumption of stratospheric ozone-depleting substances. Parties agreed in 1992 to phase out HCFCs, beginning with a cap on consumption for Article 2 (developed) countries but allowing Article 5 (developing) nations to delay instituting control measures for ten years. In 1999 the parties established a cap on production and added trade restrictions, and the same ten-year delay was applied to Article 5 countries. The parties subsequently agreed in 2007 to more aggressively phase out HCFCs and accelerate the freeze on their production and consumption of HCFCs in Article 5 countries by three years, such that it would take effect Jan. 1, 2013, instead of Jan. 1, 2016.

As a result, this rule updates the EPA’s regulations to reflect that the ban on trade in HCFCs applies to Article 5 countries not party to the HCFC control measures, with certain exceptions.

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