Thursday, October 8, 1998

10:00-Noon

2318 Rayburn House Office Building

The Honorable Raymond Kammer

Director

National Institute of Standards and Technology

Richard Klimisch, Ph.D.

Vice President

Engineering Affairs Division

American Automobile Manufacturers Association

Mr. Tommy Grant

President

Grant Fastener, Inc.

Mr. Robert Brunner

Vice President and General Manager

Shakeproof/ITW

The Honorable Donald Manzullo

The Honorable J. Dennis Hastert

Despite its enactment in 1990, no implementing regulations for the Act had been finalized until April 14, 1998. NIST’s current final rule was developed only after legislative changes were adopted to the Act in 1996. Before the Science Committee delayed NIST’s action by passing H.R. 3824 (P.L. 105-234), the Fastener Quality Act Amendments, NIST’s final rule was slated to take effect in July of 1998.

During the May hearing that preceded passage of H.R. 3824, both NIST and the FAA agree that requiring certain aviation fasteners to fall under FQA regulations would create duplicative and potentially confusing regulations that would not assist the Federal Government in its efforts to ensure the safety of the flying public. Furthermore, both the FAA and the National Transportation Safety Board have stated that they are unaware of any fatal aviation accidents caused by a substandard proprietary fastener.

Much like the aviation industry, automotive companies, fastener manufacturers, fastener importers and most fastener distributors feel that FQA needs to be fundamentally reformed or abolished. These companies point to the apparent lack of evidence of significant fastener failures over the last ten years, and the improvements made in the fastener manufacturing process.

No such unanimity existed in 1986 when Congress first began investigating unfair foreign trade practices and the dumping of "substandard" fasteners in the United States market. The then Committee on Energy and Commerce held hearings in the spring and summer of 1986 on unfair foreign trade. During those hearings, complaints by Tommy Grant to the Department of Commerce about foreign fastener manufacturers "dumping" substandard fasteners in the U.S. market surfaced. In 1988 and 1989, the Committee on Science held hearings on the proliferation of counterfeit bolts and fasteners and the Energy and Commerce Committee issued an investigative report entitled "The Threat from Substandard Fasteners: Is America Losing Its Grip?"

The hearings and report paint a picture of significant problems associated with mislabeled, and therefore substandard, foreign fasteners. The report catalogued problems in military procurement of fasteners at the Defense Industrial Supply Center (DISC) which caused the use of substandard fasteners on military vehicles such as M-60 tanks. The report included an account of one death associated with the failure of a fastener during construction of a Saturn automotive plant, and indicated that the National Aeronautics and Space Administration (NASA) had also experienced problems with faulty fasteners.

Finally, the report indicated that substandard fasteners "largely" originate from foreign companies in Japan, Mexico, Spain, Korea, Taiwan, and Poland, and are the result of apparent attempts to undercut legitimate U.S. fastener manufactures with products that are manufactured specifically to a cheaper standard rather than the result of a poor manufacturing process. The report states:

"…Japanese producers were willing to produce fasteners with the wrong chemical composition bearing false markings to provide an aura of legitimacy to enhance their salability to unsuspecting end users. The importers proceeded to dump these fasteners in the America marketplace."

As a reaction to the report and hearings, Congress passed FQA.

Despite its passage in 1990, FQA has never been implemented. Questions about the adequacy of laboratories facilities to test fasteners in a timely manner, the definition of fasteners covered by the Act, and the need for FQA have dogged the law and prevented implementation of a final NIST rule.

During a May 7, 1998, Technology Subcommittee hearings on "Aviation Manufacturing and the Fastener Quality Act." Ray Kammer, the Director of NIST, explained that the intention of the FQA is to improve fastener quality and reduce the danger of fastener failure. According to the Director, the Act serves to protect public safety by requiring fasteners to conform to uniform specifications and be tested by accredited laboratories. Mr. Kammer further emphasized that NIST worked closely with affected industries to develop the necessary testing procedures, while attempting to reduce the cost of compliance. He testified that the original law would have had a $1 billion impact on industry, but NIST has streamlined the procedures so that the impact will be minimal. Mr. Kammer, under questioning by the Subcommittee Membership, suggested that passage of the FQA may have occurred because of emotional, but inaccurate, reports about fastener failures. He additionally suggested that the FQA, in part or as a whole, may no longer be needed.

On May 13, 1998, the Committee on Science passed H.R. 3824. H.R. 3824 amended FQA to exempt aviation fasteners which are already regulated by the Federal Aviation Administration (FAA). The law also delayed the implementation of NIST’s FQA rule until June 1, 1999 or 120 days after the Secretary of Commerce issues a report on changes needed to the law, whichever is later. This reprieve is intended to allow Congress an opportunity to further amend FQA before the current NIST regulations go into effect. On August 14, 1998, H.R. 3824 was signed into law.

The Secretary of Commerce has designated Ms. Ellen Bloom, the Secretary’s Deputy Chief of Staff, to lead the Commerce Department’s review. Dr. James Hill, Chief of NIST’s Build Environment Division, will be responsible for writing the report. Dr. Hill has not been involved in previous NIST efforts to enforce FQA. Commerce will announce a public comment period on FQA in the Federal Register shortly.

• What further changes need to be made to FQA?
• Have there been any significant fastener failures since FQA was passed in 1990?
• Have changes in the fastener manufacturing process obviated the need for the Act?
• Are there sufficient labs to meet the requirements of the NIST regulations?
• What impact would the NIST regulations have if they were allowed to go into force on June 1, 1999?
• Are there still significant instances of substandard fasteners being sold in the United States?
• Are these instances limited to foreign fasteners?
• How will the Commerce Department’s study be conducted and how will Commerce ensure that it maintains its objectivity on FQA?