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Small Businesses Testify on Unfair Challenges in Meeting Regulations



News from the

House Committee on Small Business

Subcommittee on Investigations and Oversight

Jason Altmire, Chairman

Lawmakers Call For Clear Toy Safety Standards

Small Businesses Testify on Unfair Challenges in Meeting Regulations


WASHINGTON, DC - Small businesses told Congress today that tougher safety standards passed in the wake of 2007 lead-tainted toy recalls have been mismanaged, with confusing regulations resulting in steep financial losses that threaten to bankrupt their businesses.  At a hearing of the House Small Business Committee's Subcommittee on Investigations and Oversight, chaired by U.S. Congressman Jason Altmire (PA-04), business owners criticized the Consumer Product Safety Commission (CPSC) for failing to provide clear safety requirements and guidance, leaving small firms struggling to comply with muddled regulations.


"The wave of product recalls in 2007 highlighted the need to update our safety standards to protect consumers, especially our children," Subcommittee Chairman Jason Altmire (D-PA) said.  "Unfortunately, now many small businesses, including those that sell products that do not pose a health risk, are facing significant losses as they struggle to meet a host of new, and often confusing, regulations."


After more than 17 million toy units were recalled because of excess lead levels, Congress passed the Consumer Product Safety Improvement Act (CPSIA), strengthening children's product safety standards for toys, clothes, and books.  However, witnesses today criticized the CPSC for laying out inadequate guidelines detailing when and what products need to undergo testing, which can often be costly, especially for small businesses.  They also charged that CPSC, which can exempt products from testing that do not pose a threat to consumers, has moved slowly in granting these exceptions, forcing businesses to unnecessarily pull goods off their shelves and hurt their bottom lines.


"As entrepreneurs struggle in the current economic climate, the vagueness of important CPSC guidelines have left businesses in limbo," said Chairman Altmire.  "The unnecessary losses incurred by small businesses because of CPSC's ineffective leadership have hurt entrepreneurs' efforts to lead our nation out of the economic downturn and ultimately create new jobs."


While the CPSC has delayed enforcing testing and certification standards until 2010 to provide more time for compliance, the Obama Administration has taken steps to revitalize the overstretched safety agency, boosting its FY 2010 budget by 71% compared to 2007 levels.  In addition to clearer testing guidelines and broader non-harmful product exemptions, witnesses at the hearing called for a comprehensive education and outreach program by the CPSC to help entrepreneurs manufacture and sell safer merchandise for all consumers.


"I am hopeful enhancing resources for the CPSC will lead to a smoother transition to these new regulations for manufacturers, retailers, and consumers," said Chairman Altmire. "Small businesses can help lead the effort to ensure children's products are safe, but only if they are given the common-sense guidance they need to compete fairly under these new standards."


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Click here to view video of the hearing.

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