SEPTEMBER 2019

REGULATORY RADAR HEADLINES BUSINESS INTELLIGENCE CPCA REPORT FUNDING OPPORTUNITIES CANADIAN TRADE-RELATED ACTIVITES EVENTS OF INTEREST Several Formal Comments Submitted on MHSW Wind-up Plan to Stewardship Ontario and Minister of Environment, Conservation and Parks CPCA Comments on the Federal Regulatory Modernization Consultation CPCA Supported Canadian Manufacturers Coalition Seeking Delay of Labour Code Changes for Transportation of Dangerous Goods CPCA Filed Comments on the Proposed CMP-WHMIS Integrated Strategy to Further Protect Workers and Endorsed Industry Coordinating Group Comments Comments Submitted on DSAR and Risk Management Scope for the Resins and Rosins Group Comments Submitted on DSAR and Risk Management Scope for the CMP-2 Zinc and Its Compounds Subgrouping CPCA Inquired About the Calcium 2-Ethylhexanoate SNAc Content CPCA/ACA Alerted Members of Methylene Chloride Ban in Paint Strippers Taking Effect in the US on November 22, 2019 Comments Submitted on the Proposed Third VOC Regulations on September 19

Members Updated on TiO2 Carcinogenic Classification Approval Status Members Updated on Microplastics Status in the EU CPCA Seeking More Input/Data on the Use of Microplastics in CASE Products Sold in Canada CPCA to Respond to Health Canada Requiring Extensive Technical Info on True Copy Label Burden PMRA Expected to Communicate Decision on OIT Review by November 26 and the Final Paint Cluster Proposed Decision in February 2020

Members can read updates on these issues n the Regulatory RADAR or by logging into the CoatingsHUB CPCA Annual INSIGHT: Guide & Directory CPCA is currently working on a new issue of INSIGHT: Guide & Directory magazine. The magazine will be published in the fall of 2019 and delivered to members and more than 3000 industry leaders across North America. If you would like to learn more about advertising opportunities, contact Don Burns to receive the media kit.

Action on VOCs in Canada Members Need to Respond to Two VOC Regulatory Initiatives in September Proposed Third VOC Regulations in the Canada Gazette Part I: Comments Filed on to September 19 Member Action: CPCA received very few member's views and focused on the needs for the definitions and scope to be better aligned with CARB 2010 and a 3-year sell-through period.

National Questionnaire on Architectural VOC Contents Questionnaires Should be Returned by September 20 Member Action: ECCC (Environment Climate Change Canada) intends to compare the current VOC content of AIM paint products sold in Canada with those of US jurisdictions including CARB. Although this survey is non-mandatory, ECCC needs to rely on a representative sample of AIM products that is in Canadian commerce. CPCA urges all members and colorant distributors to make efforts to respond. A consultation for a Revisited Architectural VOC Regulations is expected in the first part of 2020 and CPCA will need to be prepared for those discussions on behalf of members.

Environment New E2 (Environmental Regulations) Now Enforced: Plans Must be Re- submitted via a New SWIM E2 Reporting System Since August 24, 2019, all information required under the new E2 Regulations, 2019 must be submitted electronically in the new online E2 reporting system, accessed through the Single Window Information Manager (SWIM) available online. This new electronic reporting system will permanently replace the old E2 reporting system that will no longer be available.

CPCA General CMP Development Update CPCA Submitted Comments to Environment and Climate Change Canada Regarding Proposed Toxicity Declaration for Zinc and 64 Zinc Compounds These compounds are used in anticorrosive, pigments and driers in industrial/automotive coatings and in a limited number of Architectural paint products.

CPCA Submitted Comments on CMP-3 Draft Screening Assessment Report and Risk Management Scope Document for Resins and Rosins One substance is proposed toxic: CTO (or tall oil CAS RN 8002-26-4). CPCA received no confirmation of use of in industrial and consumer coatings, adhesives, sealants and elastomers (CASE) products, but received confirmation of use of a few other rosins and for this reason, our sector needs to remain engaged. CPCA also questioned Canada’s unique risk management actions for CTO with no equivalent in the USA and EU.

Health Canada Launches Short Information Gathering Questionnaire on 69 Alkylbenzene Sulfonates and Derivatives/Alkylbenzenes/Sulfonate Esters CPCA distributed the questionnaire to be answered before September 27. A number of these substances are used in paint and adhesives.

The Government Published a Summary of Flame Retardant Assessments and Management under CMP All members active in this market should carefully review this summary which was updated on August 28.

Ongoing Consultation on Risk Classification, Licensing and Inspection Guides and Enforcement Policy Changes for Controlled Substances and Precursors This consultation ends on September 24. The amended regulations pertinent to controlled substances are coming into force on December 9, 2019. The new documents have been developed to support compliance with the Controlled Drugs and Substances Act and its associated regulations which include the Precursor Control Regulations.

Biocides Used for In-Can and Film Preservation Further Response from PMRA Expected on OIT Ban PMRA is still in the process of analyzing several biocides under the ‘paint cluster analysis' until February 2020 and is expected to respond to industry challenges on the OIT Ban and CMIT/MIT restrictions on November 26. The proposed decision for the paint cluster analysis was expected on August 31. The decision is now delayed to February 2020. The decision for OIT and CMIOT/MIT is now expected on November 26, 2019. Until then, the OIT ban is still in effect. Apparently the PMRA risk assessment team used a rate of dermal absorption of 100% for OIT while registrants had published studies confirming a much lower dermal absorption rate, which were re-sent by registrants.

Treated Articles Note Causing Confusion CPCA sent several comments to PMRA regarding the treated articles information note and communicated a preferred list of paint biocides for paint to PMRA officials. CPCA and ACA have investigated a possible misinterpretation and misalignment of the PMRA policy that could have some impact on importers of treated articles.

Trade Policy CPCA Supports Canadian Manufacturers Coalition Seeking Delay of Labour Code Changes for Transportation of Goods The Labour Code changes that came into force on September 1, 2019, are part of omnibus bills having received royal assent applying to federally regulated workplaces but some of these changes indirectly have an impact on industry generally with respect the possible disruptions to the 24/7 continuous and just-in-time transportation of goods. Members should review their procedures to this effect.

Workplace Health & Safety CPCA Submits Grave Concerns to Health Canada on True Copy Label Requirement This document will be submitted jointly with other CIC industry documents this month to address negative impacts on operations of manufacturers, suppliers and distributors.

Health Canada/OSHA Publish Joint Guidance on Regulatory Process & Label Comparison for Shipped Containers & HNOC/PHNOC/HHNOC Label Pictograms Read More...

Post-Consumer Paint Recycling Ontario Paint Stewards Upset with Ministerial Direction on Paint Surplus of $17.5 Million CPCA filed two submissions with Ontario government agencies reiterating paint industry concerns with the MHSW wind up plan and related ‘surplus funds’ government now says hold be returned to consumers even though funds were paid by producers. The ‘surplus funds’ accumulated on the backs of paint stewards in Ontario, 99% of the volume sold by CPCA members, are in reality overcharges that were accumulated prior to 2015 before the Paint Industry Stewardship Plan (ISP) was created and, in fact, was one of the reasons for its creation. Since then paint recycling has been effectively operated under the Paint ISP, run by Product Care Recycling. A CPCA submission was sent to Stewardship Ontario to oppose the Wind-up Plan for the outstanding $17.5 million surplus and another CPCA submission was sent to the Ontario Associate Minister responsible for red tape reduction with recommendations that would address growing red tape and regulatory burden for waste recycling in Ontario. Another submission was sent to the Minister of Environment and members sent letters of concern to MPPS in Ontario. CPCA continues to argue the issue in the context of the Government’s ‘open for business’ and ‘red tape reduction’ direction for industry. CPCA is seeking a “fee holiday” or “fee elimination” approach offered to other stewards and for the fund NOT to be r reimbursed to consumers via some impossible rebate program for funds that were already internalized as part of ongoing paint operational costs. Federal Procurement Policy Should Recognize Recycled Paint CPCA seeks federal procurement policy change for minimal content requirements for recycled paint on government projects across Canada. CPCA did a Pre-Budget recommendation for a federal procurement policy. CPCA will continue to research Canadian and North American green procurement systems and inclusion of recycled paint and send this approved procurement letter to several governments.

International Development & WCC Report EU Nordic Study Draws Wrong Conclusions on Paints as Being the Primary Source of Microplastics: WCC and CEPE Scientifically Challenged the Report Paints are not a significant source of microplastics (MPs) in the environment. This recently published EU study of the Alfred-Wegener-Institute claims to have identified the main source of many microplastic particles and says they stem from ‘‘varnishes’’. The study wrongly attributes the MP pollution as coming from emissions during construction on building sites, through abrasion of coated surfaces or when handling construction waste. This study shows methodological shortcomings and is in contradiction to much more comprehensive studies on the origin of microplastics in the environment. CEPE and WCC (formerly IPPIC) have been developing scientific argumentation to challenge these study findings and demonstrate that paint and coatings are not the main contributors to MPs.

Industry Lobby in EU Fails to Get Change on TiO2 Classification

After the September 18th regulatory meeting on TiO2 (CARACAL), the European Commission (EC) announced that it intends to move forward with adopting the 14th ATP proposal of the Classification and Labelling Regulation (CLP), including the proposal to classify TiO2 as a suspected carcinogen (Cat 2.) by inhalation. The European Commission did not agree with the strong calls for an impact assessment by industry groups, stating that "no impact assessment is needed since a CLP-classification itself would never have any significant economic, environmental or social effects". The proposed classification represents a clear departure from the UN GHS criteria, is inconsistent with a variety of other hazard classification and regulatory findings around the world, and will serve as a likely compliance issue for products shipped into the EU. TDMA is currently considering its next steps including a possible legal challenge to the classification.

REACH SHVC Provides a Basis for Companies to Review Substances See how BASF, Clariant, Dow, Lanxess and other companies review potential substances of very high concern under the EU's REACH program but don't automatically phase them out, instead opting for risk-based reviews and research on alternatives.

Manufacturing & Management Information Canadian Manufacturing Coalition Published a 10-Step Guide to Growing Canada’s Economy Manufacturing is the engine of Canada’s economy, directly accounting for 10% of GDP and 1.7 million jobs. The Canadian Manufacturing Coalition (CMC) recommends a comprehensive Advanced Manufacturing Strategy to accelerate growth in the sector and increase prosperity for all Canadians. The CMC published 10 steps designed to solve labour shortages and drive investments, reduce the cost of doing business and drive competitiveness, and make it easier to seize business opportunities.

Federal CPCA Submits Comments on Regulatory Modernization to Federal Government The Treasury Board of Canada would like Canadian industries to identify specific areas of legislation that currently prevent regulations from being agile and responsive, while continuing to protect health and safety, and the environment, with regard to a Targeted Regulatory Reviews (Round 2); a Review of the Red Tape Reduction Act; Options to legislate changes to regulatory mandates; and Suggestions for the next annual Regulatory Modernization Bill.

Register for Free with MyEDC to Access New Resources to Help Your Company Thrive Abroad This new secure online portal was created to give you unlimited one-click access to insights and guides that will help you make smarter decisions and thrive abroad. The following high-value resources are available (Export Help Hub, EDC Company InSight, ECD InList, Top 10 Riss Guide, Country Risk Quarterly, Global EDC Forecast)

Labour and Employment Guide Available This guide is an overview of some of the key points of law and practice, allowing you to compare regulatory environments and laws across multiple jurisdictions.

Diversity and Inclusion Policies in The Workplace At a minimum, organizations should consider incorporating a policy on D&I.

Provincial Ontario Upcoming MOL Industrial Inspections in 2010 From October 1 – December 27, MOL inspectors will be visiting Ontario workplaces in the construction, health care, industrial and mining sectors, looking for OHSA infractions related to musculoskeletal disorders and respiratory hazards specific to silica, welding fumes and diesel exhaust. As for machine guarding inspections, the MOL will offer Compliance assistance with Workplace Safety and Prevention Services from January 20- March 31, 2020. Focused inspections from February 17-March 31, 2020.

FedDev Ontario Announces Major Investment in Six Toronto-based Organizations FedDev Ontario is investing a combined total of up to $53,340,000 in six leading-edge organizations to lead projects that will support 870 companies.

Québec Montreal Region Designated Foreign Trade Zone Point This designation will streamline access to government programs and services and help local businesses optimize their exports abroad. A Foreign Trade Zone Point is where the purchase or import of raw materials, inputs or finished goods is officially eligible for exemption from customs duties and taxes.

Saskatchewan Saskatchewan, Ottawa Disagree over Timeline for Infrastructure Dollars Ottawa is accused of delaying infrastructure projects worth $200 million from starting this construction season.

NWT N.W.T. Premier Urges Investment in Arctic Ports as Sea Ice Recedes Climate change has hurt the northern economy in ways few southern Canadians can appreciate, but NWT now wants to make sure his territory benefits from increased shipping traffic as a result of Arctic sea ice melting. Canada recently announced a $4.7 million investment in transportation infrastructure as well as $7.4 million in the construction of 61 aerodromes, also in Nunavut and Yukon. Business and Economic Trends New Blockchain Network Platform to Simplify Supply Chain Management IBM and Chainyard announced Trust Your Supplier (TYS), a new blockchain network designed to improve supplier qualification, validation, onboarding and life cycle information management. See how Slavefreetrade is Using Blockchain to shine a light on the good guys since everyone is presently buying slave-made products, but they don’t know. No one can tell.

How to Make the Right Choice between 2D vs. 3D in Surface Metrology Three-dimensional measurement devices offer new insights into surface structures and processing alongside established 2D technology.

Formulators Can Move Away from Trial-and-error For 100,000 EUR, your company can still get a smaller high-throughput lab that can prepare samples for HT screening. But in most cases for smaller companies, it makes more sense to outsource to service companies. Attend the forum on Optimizing cost and processes in paint formulation, in Berlin.

White Paper, ‘The Digital Revolution in the Chemical Industry Must be Matched With Rapid Evolution in its Supply Chain’ Read also this other article on further digitizing the supply chain.

Economic Trends Deloite: Economic Indicators Are Looking Up, Setting the Stage for Continued Moderate Growth in the Remainder of 2019 and in 2020 Like other economies, Canada remains susceptible to external shocks, especially political and trade risks. Debt-laden Canadian households will keep their wallets open, but spending growth will only be moderate. And the US-China escalating trade war comes at an inopportune moment for the Canadian economy.

Conference Board of Canada World Economy Outlook of Summer 2019 Global economic growth has passed its peak and is slowly transitioning to a weaker pace.

74 Per cent of Economist See US Recession by End of 2021 Read More...

2019 Paint Mergings and Acquisitions Deals to be Down 10 Percent in 2019 Compared to 2018 However, Asian paint companies continue to be aggressive in pursuing assets in Europe and North America.

Canadian Building Permits, June 2019 The value of municipal permits declined by 3.7 per cent and in six provinces. Institutional and commercial permits declined by 2.2. percent.

USGBC Report Reveals 19 Per Cent Growth in LEED Residential Market LEED-certified green homes hitting an all-time high in the USA.

New Transfer Payment Ontario (Formerly Grants Ontario) Transfer Payment Ontario is your source for funding provided by a number of Government of Ontario ministries. It is a one-window access to information about funding opportunities that are available, how to apply for them and how to check the status.

Government Accelerate Growth Service http://web.mentorworks.ca/wbn-2019-09-12-manufacturing

Online Webinar: Government Funding to Grow Manufacturing Business September 12, 2019 11:00am - 11:45am ET http://web.mentorworks.ca/wbn-2019-09-12-manufacturing

Publications & Business Reports

Joint Federal Provincial Investment of $79M for Buses in B.C. Vancouver Port to Get $102M in Transportation Infrastructure Funds Public Transit Project of $87.9M in Lévis, Quebec

List of Megaprojects Canadian Trucking Alliance 2019-2020 Infrastructure Priorities A non-exhaustive list of specific projects and general project areas for consideration.

CPCA Webinar: CPCA Webinar: U.S. Canada & Canadian AIM CoatingsHUB VOC Regulations CPCA: Protecting Your Interests Since 1913 CPCA regularly publishes several important publications to ensure members are fully informed of ongoing issues and actions impacting the paint and coatings industry in Canada. These include:

Regulatory RADAR CPCA Regulatory RADAR reports on news of interest to paint and coatings manufacturers, suppliers and distributors. A members-only publication detailing comprehensive legislative and regulatory actions at all levels of government.

Prime Time News A publicly available monthly newsletter sent to members, stakeholders and governments to provide a window into the industry for those with an interest or role in the sector.

Industry NOW A members-only publication addressing relevant issues for those involved in management, sales and marketing in member companies.

CPCA INSIGHT Guide & Directory published annually to report on CPCA’s work on behalf of members, key trends in the industry, raising awareness of the issues important for the sector and a guide of CPCA members supporting the important work done to sustain a long-standing and viable Canadian industry

Regular Bulletins, Updates, Memoranda and Press Releases CPCA members are fully informed and can have direct input on actions taken by CPCA’s board, technical committees and staff to ensure the industry is represented at the table when decisions are made affecting their business.

All past issues of CPCA Publications can be found online. FOLLOW CPCA ON ALL OUR SOCIAL MEDIA CHANNELS!

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