As Congress returns from its August recess, the House has plenty of work on its plate regarding the U.S. Consumer Product Safety Commission (CPSC). As we wrote previously, six bills addressing specific CPSC-regulated products are on the House floor awaiting votes. Another bill still under subcommittee consideration could help companies regulated by the CPSC, the agency itself, and consumers.
The Focusing Attention on Safety Transparency and Effective Recalls (FASTER) Act (H.R. 3169) would formalize and improve the CPSC’s Fast Track voluntary recall program. In 1995, Fast Track was a welcome and successful innovation, but recently companies have been frustrated by growing delays.
To understand how Fast Track works, observers need to look at how the Consumer Product Safety Act of 1972 (CPSA) contemplates recalls. The CPSA requires that companies report any information that “reasonably supports” a potential need for a recall. The CPSC then evaluates the potential hazard and identifies any appropriate remedy. The CPSC must win a lawsuit to force a remedy that a company disagrees with, which can be a time-consuming process.
The CPSC’s credibility is on the line in this recall process. If the CPSC approves a remedy that proves inadequate, its credibility suffers. Traditionally, the CPSC reviews potential hazards and remedies through a Preliminary Determination (PD) process that relies on extensive engineering analysis. The PD helps the CPSC obtain more information to validate recalls, but it adds even more time to the process.
Enter Fast Track
In 1995, the CPSC created Fast Track “to use staff resources more efficiently and to promote quicker recalls.” Fast Track skips the PD process, saving the CPSC significant time and resources. Companies benefit from the efficiency, too, and also because, were the CPSC to issue a PD, the information it contained may be subject to FOIA requests. Most importantly, recalls happen sooner: To participate in Fast Track, a company generally must be able to implement a recall within 20 business days after it files an initial report under the CPSA.
Fast Track has been a resounding success. It has sped up recalls, as intended. And it also enables recalls that otherwise would not happen, saving more CPSC resources. In 1994, the CPSC administered 108 recalls. Today, that number is generally closer to 300 a year, with more than half coming through Fast Track. The CPSC does not have the resources to pursue and litigate that many recalls without Fast Track. Moreover, the CPSA allows the agency to compel recalls only for “substantial product hazards,” a carefully defined term of art. Many Fast Track recalls involve potential hazards that would not meet that definition, so the program enables recalls the CPSC could not otherwise compel.
Now, however, Fast Track has slowed, and recalls may take weeks or months.
Two reasons account for this slowdown. The first is resources. The CPSC has about 530 employees to cover all of the agency’s responsibilities across its jurisdiction of over 15,000 product categories. Each of the offices that evaluates, approves, and disseminates a recall has other tasks competing for its scarce staff time.
Second, the CPSA makes the CPSC responsible for pre-approving recall remedies. The CPSC faces reputational risk if it accepts a recall that proves inadequate, and the agency is understandably reluctant to take any risk without some validation method.
The CPSC’s diligence is made necessary by the CPSA’s unique structure. Other agencies, like the National Highway Traffic Safety Administration (NHTSA) or the CPSC’s consumer-product peers in Canada, Australia, or the European Union, do not have the same burden. In these agencies’ domains, the recalling company bears sole responsibility for finding the right fix, while the agencies’ task is to use the voice of government to help spread the word. The agencies may ask for more robust measures when a recall proves inadequate, but, because they are not the gatekeepers, they would be less subject to criticism were an issue to require additional measures.
Fast forward to the FASTER Act. Under the Act, a company that wanted to conduct a recall would give the CPSC notice of the recall, and the CPSC would post the notice to the agency’s website. The CPSC staff’s expertise would still be available, but the burden for determining the adequacy of the recall would remain with the company.
The FASTER Act has already been introduced under HR 3169, but members and staff of the Subcommittee on Consumer Protection and Commerce continue to refine it. If members of the CPSC community – from regulated companies to academics to consumer advocates – have suggestions for improving the bill and the recall process, they should share their thoughts with the subcommittee.