Regulatory changes coming regarding certain products and volatile organic compounds

Recent regulatory changes were introduced with the Volatile Organic Compound Concentration Limits for Certain Products Regulations, made under the Canadian Environmental Protection Act, 1999, and published on January 5, 2022. These regulations set out maximum concentration limits and emission potentials for volatile organic compounds (VOCs) for manufacturers and importers of certain prescribed categories of products, while also providing several alternative compliance options. VOCs are precursor pollutants that contribute to the formation of ground-level ozone and fine particulate matter, which contributes to forming smog.

The introduction of these regulations responds to the Gothenburg Protocol and its amendments, ratified by Canada in 2017, which require ratifying parties to control and reduce VOC emissions.¹ Created under the United Nations Economic Commission for Europe’s Long-range Transboundary Air Pollution Convention, this protocol sets its own limits on air pollutants such as VOCs, with the understanding that they can have far-reaching, cross-border effects.²

The regulations are set to come into force on January 1, 2023, providing businesses with the opportunity to adjust practices or seek regulatory approval over the next year. In this update, we will summarize the changes coming into effect and discuss the options available for businesses to ensure compliance.

Summary of key components

Application

The regulations apply to manufacturers and importers for certain product categories and subcategories.³ These  include personal care; maintenance; adhesives, adhesive removers, sealants, and caulks; and other miscellaneous items. Reference should be made to column 1 of the tables to Schedules 1 and 2 for a full list of product inclusions.

The regulations also list certain products to which the regulations do not apply, including those designed to be used solely in a manufacturing or processing activity, or those to be used for certain research purposes.⁴ Reference should be made to section 2(2) of the regulations for a full list of product exclusions.

Substance

The key focus of the regulations is to set out maximum VOC concentrations and VOC emission potentials for the products to which it applies, with the goal of protecting the environment and the health of Canadians from the effects of air pollution produced by such emissions.⁵ 

The regulations define a VOC as a “volatile organic compound that participates in atmospheric photochemical reactions and that is not excluded under item 65 of Schedule 1 to the Canadian Environmental Protection Act, 1999.”⁶  VOC concentrations are to be measured and expressed as a percentage of the product’s net weight.⁷ (See guidance document on calculating such concentrations linked here.) The regulations then prohibit persons from manufacturing or importing a product with VOC concentrations and emission potentials beyond the maximums set out in the applicable schedules, unless the product meets certain criteria pertaining to dilution before use or one of several permits has been issued.⁸   

Alternative compliance options

To ensure a measure of flexibility, the following three alternative compliance options are provided by the new regulations:

• VOC Compliance Unit Trading System: The regulations have set up a compliance unit trading system, for which those manufacturing or importing products belonging to certain product categories in column 1 of Schedule 1 may elect to participate in.⁹ This system allows participants to “balance emissions from products that exceed the concentration limits with compliance units earned from products that were reformulated to have VOC concentration lower than the regulatory limits.” ¹⁰ As such, persons electing to participate in this system may apply for a permit authorizing them to manufacture or import products belonging to certain listed product categories with greater than the applicable maximum VOC concentration.¹¹  Interestingly, under this program, businesses are also permitted to trade compliance units with other businesses.¹²
• Permit — Products Whose Use Results in Lower VOC Emissions: Businesses may apply for a permit authorizing the manufacture or import of products belonging to certain listed product categories with greater than the applicable maximum VOC concentration that, when used in accordance with the manufacturer’s instructions, result in lower VOC emissions than would result from using another product belonging to the same category.¹³
• Permit — Technical or Economic Non-feasibility: Beyond the applicable start date, businesses intending to manufacture or import products belonging to the prescribed categories with VOC concentration or emission potential greater than the applicable maximums may apply for a permit authorizing them to manufacture or import such products if it is not technically or economically feasible for them, by such date, to reduce the product’s VOC concentration or emission potential to a level less than the prescribed maximums.¹⁴

Coming into force

As noted, the regulations do not come into force until January 1, 2023, providing businesses time to make any necessary changes and/or seek the appropriate permits. Following this, the maximum VOC concentration limits and emission potentials for the manufacture and import of products listed in the schedules will come in effect for all product categories on January 1, 2024, with the exception of disinfectants, which will come into effect on January 1, 2025.¹⁵

Key takeaways

While regulatory changes relating to certain products and VOCs are afoot, businesses  have  time to bring their practices in line with the regulations.  With a focus on ESG,  and protecting the environment and health of Canadians, businesses should take steps now to adjust practices to ensure they comply with the new maximum VOC concentrations and emission potentials, or else canvas the various alternative compliance options to ensure the necessary permits are sought within the applicable timelines.

The author would like to thank Rebecca Brown, articling student, for her contribution to this legal update.