By Jeryl L. Olson, Ilana R. Morady, Patrick D. Joyce, Philip L. Comella, and Craig B. Simonsen

shutterstock_30524071The Pipeline and Hazardous Materials Safety Administration (PHMSA) just announced that it has amended the Hazardous Materials Regulations (HMR). 81 Fed. Reg. 18527 (March 31, 2016).

It has done so by adopting its proposed regulatory amendments applicable to the reverse logistics shipments of unsellable products containing hazardous materials (for example, expired over-the-counter drugs, health care products, damaged and open retail containers of soaps, cleaners, household products, spilled materials, etc.) from a retail facility back to a distribution or reclamation facility by highway transportation.

We have previously blogged about state and federal hazardous waste regulations and their impacts on unsellable products in the retail industry, and have also blogged specifically about the proposed HMR rule affecting transportation of retail wastes and recyclables. The new HMR final rule revises the HMR to include a definition of “reverse logistics,” and provides provisions for the shipment of unsellable products containing hazardous materials within the scope of the new definition.

Specifically, PHMSA has adopted a definition of “reverse logistics” for unsellable products containing hazardous materials as “the process of offering for transport or transporting by motor vehicle goods from a retail store for return to its manufacturer, supplier, or distribution facility for the purpose of capturing value (e.g., to receive manufacturer’s credit), recall, replacement, recycling, or similar reason.”

Importantly, under the final rule, reverse logistics shipments may only be shipped via highway carrier — rail and air transport of reverse logistics shipments are prohibited.  The final rule also requires that all materials sent in reverse logistics by private carrier contain the marking “REVERSE LOGISTICS – HIGHWAY TRANSPORT ONLY – UNDER 49 CFR 173.157” to notify the carrier that the shipment could contain products with limited amounts of hazardous materials.  Reverse logistics shipments sent by non-private carriers must still comply with all limited quantity conditions contained in 49 CFR 172.315.

This final rule also expands a previously existing exception for return shipments of used automobile batteries from multiple shippers using a single transport vehicle between a retail facility and a recycling center.

Retailers should keep in mind that this final rule is independent of, and in addition to, state and federal waste (RCRA) rules applicable to returns of products containing hazardous materials, including, but not limited to, waste determination requirements for such products, hazardous waste generation thresholds, manifesting requirements, etc. Retailers engaged in reverse logistics must ensure they are in compliance with state and federal RCRA rules in addition to this new final PHMSA rule.

The Final rule was effective on March 31, 2016.