With applications across industries as wide-ranging as drugs, consumer products, and chemicals, nanotechnology has the potential to radically impact manufacturing. Already, nanomaterials have been applied or embedded to make sneakers with increased flexibility, clothing that is stain-resistant, refrigerators that are designed to prevent the growth of bacteria, car paint that is more scratch resistant than conventional paint, airplanes that are made from lighter material, chemotherapy drugs that are less toxic, and flat-panel screens that are lighter and use less power.

Nonetheless, there is not one single law that regulates the manufacture of nanomaterials. Moreover, the laws that could be used to regulate nanomaterials were written years -- or even decades -- before nanomaterials entered the marketplace. This may soon be changing, however, as recent developments with the United States Environmental Protection Agency (EPA) suggest that the agency is moving in the direction of specifically regulating certain types of nanomaterials, and it is critical that manufacturers stay abreast of the regulatory changes that may be forthcoming.

How products and technologies are regulated by the EPA, as well as by other agencies that have jurisdiction over most nanomaterials, such as the Food & Drug Administration, is driven by the impacts on human health. For nanomaterials, this has meant that the regulatory agencies have spent the last few years funding research on, and trying to obtain accurate information about, their toxicity, how they may enter the human body, and what the body's reaction would be to these substances.

To this end, in 2008, the EPA launched a two-year program that provided industry and others with an opportunity to voluntarily provide data on toxicological and other risks of nanomaterials, and to participate with the EPA in developing a program to test, monitor and mitigate those risks. However, a year into the program, the EPA registered its disappointment that data on approximately 90% of potentially commercially available nanoscale materials had not been reported.

As a result, EPA recently signaled that it is willing to use its existing authority to obtain this risk data. That is, the EPA has the option of compelling industry to submit all existing data on human health and environmental impacts of nanomaterials. The EPA also has the option to issue a rule requiring companies to conduct tests on entire classes or categories of nanomaterials to evaluate health impacts if it is determined that there is substantial risk of injury to human health or to the environment from such substances.

This second option would be a costly proposition for companies, particularly those that are small or middle market players and may not have the internal resources that large companies do for testing their materials and for complying with reporting obligations.

Early last month, EPA proposed rules applicable to chemical companies that manufacture, process or import certain forms of nanomaterials. Specifically, multi-walled carbon nanotubes that are used as an additive/filler for polymer composites and support media for industrial catalysts would be subject to regulation. This proposed rule does not apply to all variants of multi-walled carbon nanotubes, but it does come on the heels of another proposed rule issued in late November 2009 that applied to a form of single-walled carbon nanotubes and to another form of multi-walled carbon nanotubes.

Once the new proposed rule is finalized, it would have three direct impacts on chemical companies that use multi-walled carbon nanotubes for the particular purposes designated. First, a notice would need to be provided to the agency at least ninety days before manufacturing, processing or importing the substance. This notice would have to contain, among other things, information on the total -- or reasonable estimate -- of the amount that will be manufactured, used or processed, as well as how the substance will be disposed.

Second, submitters would be required to provide test data that are in their possession or control and to describe any other data that is reasonably ascertainable. Specifically, the EPA is seeking data on lung impacts, immunotoxicity and mutagenicity, and is recommending (but not mandating) that tests be conducted in consultation with the EPA in order to facilitate the evaluation of the notice that has been submitted. Third, the proposed rule specifies the personal protective equipment workers should use when handling these substances. For those not involved in manufacturing this form of multi-walled carbon nanotubes, the EPA's requirements and recommendations in this particular instance are likely to be the forerunner of what can occur with other nanomaterials.

On the longer-term horizon, the EPA will have to decide how to deal with nanosilver. Nanosilver is used in a number of consumer products, including socks, because of its antimicrobial and antibacterial properties. The EPA has already fined one company in California for applying nanosilver coating to components of a computer and advertising the health benefits of its application without first registering the product as a pesticide. More broadly, environmental and consumer advocacy groups have filed a petition with the EPA asserting that all nanosilver should be regulated as a "new pesticide" that is not covered by existing silver registrations.

Manufacturers who use nanosilver have argued that nanoscale silver is not a new material but rather a new term and that ultra small silver particles have been registered and tested for over fifty years. An EPA scientific review panel is currently considering the issue. However, if, ultimately, the EPA decides that nanosilver is, in fact, a "new pesticide," then an expensive testing regime will need to be undertaken by its manufacturers.

In addition, it is possible that, in the future, other agencies will become more involved in the regulation of nanomaterials as well. The FDA has been researching the risks associated with nanosilver and titanium oxide and zinc oxide in food, drugs and cosmetics. The FDA regulates each of these categories differently, with the most stringent requirements being applicable to drugs and the least stringent being applicable to cosmetics.

Environmental groups and consumer groups have already petitioned the FDA to regulate nanoscale titanium oxide and zinc oxide that is used in sunscreen as a "new drug" and have contended that the existence of such materials in currently available sunscreen should be considered an imminent hazard. Moreover, the National Institute of Occupational Safety and Health ("NIOSH"), which makes recommendations to the Occupational Health & Safety Administration ("OSHA"), is researching whether the risks associated with nanoscale materials can be controlled by the safety equipment that is currently employed by workers. If NIOSH determines that additional or different safety equipment is necessary, it may trigger OSHA to issue new requirements. Naturally, as with the EPA's actions, any decision that the FDA or OSHA makes will have significant impact on the bottom line.

As 2010 unfolds, manufacturers are likely to see increased regulation by the EPA. Moreover, it is likely that the EPA will not be alone in this endeavor and that other agencies will also begin to specifically regulate certain types of nanomaterials.

B. David Naidu, Esq., is a partner at the global law firm K&L Gates LLP. He specializes in counseling companies on environmental regulatory compliance, litigation and transactional matters. He is also the author of Biotechnology and Nanotechnology: Regulation under Environmental, Health and Safety Laws (Oxford University Press, 2009). www.klgates.com