PRESS RELEASE

Are You Ready For the Fastener Quality Act?

From: Bonnie G. Carter
Date: 3/01/98

Comments

The impending date for enforcement of the Fastener Quality Act is quickly approaching. May 26, l998, will usher in a new era of paperwork requirements for all fasteners which are heat treated or sold according to a consensus standard. The cost for compliance is still largely an unknown factor. The final comment period ended last November and National Institute of Standards and Technology (NIST) had promised the finished document would be ready in January. Unfortunately, it is now only a few weeks to implementation, and we still do not have the definite facts of the law.

We do know the original intent of the law was to cover only 1% of the fasteners used in commerce. No one ever disagreed wah the inclusion of certifications chemical and physical, for critical use fasteners. However, in passing the Act, Congress did not define "critical application", or restrict coverage to high strength fasteners. They assigned the task to the Secretary of Commerce and NIST. It is now estimated 25% to 55% of currently available fasteners in all standards fall into the definition of "fasteners" and are therefore subject to the requirements. By the most recent draft, over 40% of most common metric fasteners (my specialty) will be affected.

There are several long, complicated definitions of a fastener. To keep it simple, a fastener is a screw, nut, bolt or stud having external or internal threads. To fall under this Act the fastener is 5 mm or1/4 inch and larger, has been through-hardened (heat treated), is made of metal including stainless steel and ordered to a standard or specification (ISO, DIN, JIS, ASTM, SAE, etc.). Any fastener bearing a head marking will also qualify. It is worth the time to become familiar with the full definition from NIST.

It is generally agreed the documentation and tracking responsibilities fell to the manufacturers, importers and distributors. If the final version of the Act has not changed this aspect, the end-user and the OEM may not be involved in the paper chase - other than bearing the costs forced upon their suppliers.

The costs to your suppliers are very real and not just monetary. Still an unknown from NIST are the requirements for all traceability documents (certs) to be with all goods at the time of importation. Goods manufactured domestically do not need to have the certifications travel with the goods. In 1996 nearly 30% of total fastener sales sold were from imported stocks. In metric, we can state over 80% available were imported fasteners. Imported fasteners have the added attraction of forcing the end user, doing their own importing, to adhere to the Act. Fasteners sold for maintenance and repair of products are also covered by the Act.

The certs are held for five years after the last parts are sold from stock. These certs must be backed up by the original chemical and physical analysis of the steel heat and the subsequent test results from the fastener manufacturer stating tensile and standards result. The laboratory used to create these certs must be an accredited facility having been accepted by a small group of certifying agencies approved by NIST.

Head markings are another area of potential trouble. All manufacturers of fasteners are required to register an identifying mark with the Commssioner of Patents and Trademarks. This serves as a means of assuring easy identification of the party responsible for manufacturing the fastener. The registration process is cumbersome and time consuming. Many foreign manufacturers are encountering difficulties trying to comply. An American trademark attorney must be found and employed for the registration process. If the manufacturer's address is not in a traditional American form, delays should be anticipated, and they encounter the obvious language problems. However, head markings are not limited to companies doing the original forming of the item. If the fastener is significantly altered by plating, machining, or through-hardening, the organization doing the altering becomes the manufacturer. Therefore, anyone planning on offering secondary service to fasteners must plan on registering a head marking, finding a way of physically applying it to the modified fastener, then lab test and re-certify the fastener after processing.

The third factor causing an economic impact regards commingling of fasteners. Commingling is the old procedure of storing like items in one bin, even this will now be illegal. The Act does not permit commingling of more than two like fastener lots (if imported-NO commingling allowed).

If an end user has mixed groups of fasteners together they will no longer be considered traceable. In order to continue to guarantee the lot integrity, most distributors will not be willing to accept return of fastener boxes that have been opened. Do you see your parts crib growing into a king-sized headache? What is the cost of space to keep every just-in-time lot separated--forever?

Now, another headache, grandfathered fasteners. The question was asked at one recent seminar, "How old is a grandfather?" Any product manufactured from steel made before May 26, 1998, is grandfathered. Grandfathering guarantees the right to continue to sell into commerce any fasteners that were on a shelf somewhere before the implementation date. An argument currently raging involves whether "old' inventory can ever be certified as complying with the Act. At some points purchasing agents are not going to want the old stuff if new, certified goods are available. What is going to happen to these future obsolete inventories? Will the Fed allow a decent tax exemption for product they caused to become spoiled? Or how about the federal contractor who needs certified goods on June 1, 1998, they haven't been made yet. How long will it take for certified goods to reach the market, and what will they cost?

Since the Commerce Department has spread the authority for the Act to many agencies, we can be sure the time delays and cost add-ons will be more than any of us expects. We know NIST wrote the text of the Act, and Patent and Trademarks is responsible for recordation of manufacturers' insignias. For importers, we have the extra pleasure of dealing with the Bureau of Export Administration and U. S. Customs Service. In a recent conversation with Customs, they still have not been told how they are to implement the terms of the Act. It is a sure thing that Customs is going to impound now and ask questions later. How will Customs know if a head marking has been registered? How will Customs know a "grandfather" from a new certifiable stock? How much of the shipment will be impounded if (when) something is wrong? These are Important questions that are still awaiting answers.

So when your fastener supplier tells you we have a problem with the Fastener Quality Act, please believe them. Rob Harris, managing director of Industrial Fastener Institute told an industry publication "You cannot implement a law now and fix it later. Some manufacturers (distributors) will be put in a situation that they can't ship product. Companies will not ship in violation of the law. They aren't going to take a chance on going to jail." The penalties for violation are pretty steep for any small business person. The Secretary of Commerce may take civil action having a maximum penalty of $25,000 per violation. Criminal penalties including fines and up to 5 years in prison may be applicable. Intentional failure to maintain records may result in a fine and up to 5 years in prison. Negligent record keeping may produce a fine and up to 2 years in prison You have will have a problem with this Act if you have not adequately prepped for the downtime that will build into the fastener equation. Nuts and bolts will not be a commodity, they will become as much work as any special, part-numbered item.

For additional information on the Fastener Quality Act several web sites have been set up. Metric Importers of North America maintains a site at www.m-i-n-a.org; National Institute of Standards and Technology site www.nist/gov/fqa; NIST/NVLAP e-mail to deputy chief david.alderman@nist.gov; Small Business Administration-Office of Advocacy, from home page www.sbaonline.sba gov


Submitted by: Bonnie G. Carter Coordinator for MINA a nationwide group of 38 companies importing metric fasteners

CONTACTS AT: METRIC IMPORTERS OF NORTH AMERICA (MINA)


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