USMCA Fights Ramps Up; IPC Helps Launch New Coalition

by Chris Mitchell, vice president, IPC global government relations

Last week, IPC and more than 200 companies and industry associations announced the launch of a new coalition to make the case for congressional adoption of the U.S.-Mexico-Canada (USMCA) Free Trade Agreement.

The coalition has a series of daunting and time-pressing tasks ahead of it. The USMCA needs to surmount procedural and political hurdles and be passed this year if we are to avoid the pitfalls of election year politics in the United States.

When the leaders of the United States, Canada and Mexico signed the agreement last November, President Trump expressed his desire to see the trade bill move through Congress by early spring, if not sooner. However, several factors have pushed the timeline into at least the summer. The U.S. International Trade Commission (USITC), which is responsible for producing a report on the economic impacts of the trade legislation, fell victim to the government shutdown. Their report, which was originally due March 15, may now be pushed back as late as May 5. Although Congress is not required to wait on this report, it is unlikely that either chamber would approve the pact without an official statement on the impacts.

Congress is also waiting on the draft implementing legislation that the US Trade Representative is required to submit to Congress at least 30 days prior to introduction of the bill. Given the need to conduct congressional hearings and floor debates before final votes, and given the pressing nature of other congressional business, Congress may not get around to voting on USMCA until July or September. Any additional hurdles in the process would push the bill further into the bright lights of election-year politics.

The agreement has also hit a speed bump in the Democratically controlled House of Representatives. Historically, securing Democratic votes for a trade agreement has proven more challenging than securing Republican votes. For the last 30 years, in fact, trade agreements have been passed with the support of the Republican conference and a small but committed group of pro-trade Democrats. This time, two or three dozen Democrats are likely to cross the aisle and vote with Republicans to pass USMCA, but much remains unclear. President Trump and a changing U.S. economy have scrambled the politics of trade in ways that would have been hard to imagine even 10 years ago.

For their part, House Democratic leaders remain focused on securing changes to the agreement. Specifically, they would like to see more ambitious labor and environmental chapters to include stronger enforcement provisions. Additionally, some Democrats want to reopen negotiations related to prescription drugs. These concerns are layered on top of other bipartisan concerns, including changes to the de minimis threshold, which determines which low-value parcels can be shipped across borders tax-free, tariff-free, and with simple customs forms.

The Trump administration and the business interests that support the pact continue to emphasize the importance of passing it as early in the year as possible. USTR Robert Lighthizer, during his appearance before the House Ways and Means Committee last week, said that the agreement was “clearly” better than NAFTA and that failure to pass it would cause a loss of credibility on trade with China and other trading partners.

The coming months are thus crucial to ensuring the growth and integration of the North American economies through the USMCA. Rest assured, IPC will be in the thick of the debate, urging Congress to pass this bill and bolster the North American electronics supply chain.

 

IPC Issues Call for Participation for IPC E-TEXTILES Europe 2019

by Chris Jorgensen, director, technology transfer

IPC invites innovators, technologists, materials suppliers, electrical engineers and academicians to submit technical conference abstracts and educational course proposals for IPC E-TEXTILES Europe 2019 to be held on November 12, 2019 in Munich, Germany.

IPC E-TEXTILES Europe 2019 will provide a platform for presenters and their companies to promote their expertise in e-textiles technologies to key contacts from such industries as fashion design, health and medical, sports and athletics, automotive and military/aerospace.

Expert technical presentations are being sought in the following areas:
reliability, test methods, connectors, design, innovations in materials, mass production, washability, and market-specific e-textiles technologies (automotive, military, consumer wearables, etc.)

An approximate 300-word technical conference abstract summarizing original and previously unpublished work covering case histories, research and discoveries must be submitted. The submission should describe significant results from experiments and case studies, emphasize new techniques, discuss trends of interest and contain appropriate technical test results.

In addition, course proposals are solicited from individuals interested in presenting half-day (three-hour) professional development courses on e-textiles design, manufacturing processes and materials.

Technical conference paper abstracts and course proposals are due May 10, 2019. To submit an abstract or course proposal, e-mail me at ChrisJorgensen@ipc.org.

Trump Administration has Opportunity to Ease EPA Reporting Burden for Electronics Industry

By Chris Mitchell, IPC Vice President, Global Government Relations

The finish line may be in sight in a decade-long effort to persuade the U.S. Environmental Protection Agency (EPA) to curb unnecessary and duplicative Toxic Substances Control Act (TSCA) reporting requirements that discourage recycling of manufacturing byproducts.

In January, EPA sent the White House Office of Management and Budget a draft proposal to make changes to the current Chemical Data Reporting (CDR) regulations. Although the draft proposal has not been released publicly, we believe it may address reporting obligations for byproducts sent for recycling. It remains to be seen whether the changes that EPA is proposing constitute meaningful relief for U.S. printed circuit board manufacturers.

Printed circuit board manufacturers have long been committed to sound environmental practices, including the recycling of byproducts to reduce waste and recover valuable metals. Current TSCA reporting requirements, however, are forcing some PCB manufacturers to consider whether recycling is too burdensome and, more importantly, too risky.

Existing TSCA regulations contain specific exemptions for byproducts, but the EPA’s narrow interpretation of these rules over the past 13 years has eliminated any meaningful distinction between new chemical products and byproducts. EPA has interpreted TSCA’s exemption of byproducts to apply only if the “chemical component” in the byproduct is removed through a process not involving a chemical reaction. In effect, this interpretation excludes the recycling of metals from the exemption, and instead treats metal-containing byproducts sent for recycling as new products subject to the full regimen of TSCA regulation. Most significantly, this includes a Pre-Manufacture Notice (PMN), registration, and other requirements under Sections 5 and 6, as well as reporting and monitoring under Sections 8 and 12 and associated penalties or enforcement provisions.

The burdens imposed by EPA’s approach to this issue discourages recycling without providing any additional protection of public health and the environment. Consider the following facts:

1. EPA has not demonstrated that TSCA registration and reporting of byproducts sent for recycling is needed to protect public health and the environment. For nearly 30 years prior to 2003, EPA did not require reporting on inorganics because they were considered low risk. In 2011, EPA made a commitment to reexamine reporting requirements based on the data received during the 2012 reporting cycle, to determine whether some reporting could be eased or eliminated. IPC – through in-person meetings, letters and congressional testimony – has urged EPA to complete this analysis. But to date, we are unaware of any meaningful analysis of this data.

2. TSCA reporting imposes a burden on manufacturers. In addition to reporting of byproducts required under other laws, namely RCRA and EPCRA, TSCA imposes an additional layer of reporting for manufacturers. Most PCB manufacturers send byproducts for recycling despite the cost and despite the risk of regulatory fines for TSCA non-compliance. A typical printed circuit board factory has a database of well over 300 chemicals entries. Reporting under Section 8 requires generating very detailed information on chemical compounds or substances sent for recycling and how they may be processed by the recycler. Each TSCA report can average 64 labor hours per facility.

3. The guesswork required to report byproducts sent for recycling exposes manufacturers to considerable risk. EPA bases the applicability of notification and reporting requirements on the recycler’s actions, yet it requires the byproduct generator to make this determination. This is problematic because when the generator sends the byproduct for recycling, it may not have the information needed to determine regulatory applicability. Only the recycler knows for certain what chemical reactions (often safeguarded as trade secrets) will take place during the recycling process and how the resulting chemicals will be used. Yet, byproduct generators are required to report on this information, and they risk fines of $37,500 per day for each chemical they fail to report fully and accurately.

4. TSCA reporting of byproducts sent for recycling is largely duplicative of reporting required from the recycler and by other environmental, health and safety laws. TSCA reporting requires byproduct generators to provide information that serves the same purpose as that reported by recyclers. Moreover, EPA seeks the same basic information from byproduct generators under other reporting regimes (e.g. RCRA and EPCRA); but because EPA offices do not coordinate, the various reporting regimes require the same information to be provided in several different formats, increasing the burden.

5. Congress itself has required EPA to reduce the reporting burden on byproducts sent for recycling. In 2016, as part of the Frank R. Lautenberg Chemical Safety Act, IPC persuaded Congress to require the EPA Administrator to finalize within three and a half years a negotiated rulemaking “limiting the reporting requirements … for manufacturers of any inorganic byproducts, when such byproducts, whether by the product manufacturer or by any other person, are subsequently recycled, reused, or reprocessed.” Unfortunately, the negotiated rulemaking process ground to a halt after only a few months of effort due to an impasse among the stakeholders.

The good news is that the Trump Administration can resolve this issue through the new CDR rulemaking, most simply by eliminating TSCA reporting for inorganic byproducts sent for recycling. Until then, the existing reporting requirements will continue to discourage recycling of resource-rich byproducts and impose unnecessary business burdens on U.S. manufacturers.

Electronics Industry Joins Call for Passage of USMCA

Statement from IPC President and CEO John Mitchell

Representing the views of more than 2,500 U.S. companies engaged in the global electronics industry, and their nearly 1 million workers, IPC – Association Connecting Electronics Industries, is joining the new USMCA Coalition. which is being launched today in Washington by the U.S. Chamber of Commerce.
More than 200 companies and associations representing an array of economic sectors are backing the USMCA Coalition, which will advocate for congressional approval of the United States-Mexico-Canada Agreement.

“Building a stronger U.S. electronics industry depends in no small measure on building a stronger North American supply chain,” said IPC President and CEO John Mitchell. “Our association has members with both headquarters and thousands of jobs in the U.S., Mexico and Canada, and thus we have a strong interest in securing enactment of this agreement.

“The USMCA promises to spur even greater integration among the North American economies and strengthen the region’s stature as a formidable global manufacturing base. Improving the manufacturing competitiveness of North America will unlock more growth, innovation and job creation, benefiting people across the continent and the world.

“As always, IPC will continue to advocate for our members’ interests as the debate goes forward.”

Microvia Subcommittee Brings Industry Together, Hosts Open Forum

By Chris Jorgensen, IPC director, technology transfer; IPC staff liaison to V-TSL MVIA Weak Interface Microvia Failures Technology Solutions Subcommittee

In early 2018, Jerry Magera and J.R. Strickland, Motorola, answered a call for white papers from the IPC V-TSL Technology Solutions Committee. Their white paper, IPC-WP-023, casts a light on an issue that has been troubling the printed board manufacturing industry and upstream users of printed boards: failures at the microvia interface.

IPC-WP-023, an IPC Technology Solutions White Paper on Performance-Based Printed Board OEM Acceptance, Via Chain Continuity Reflow Test: The Hidden Reliability Threat – Weak Microvia Interface, proclaims stacked microvia reliability problems link to a weak interface between microvia target pads and electrolytic copper fill and provides data in support of their observations. Observations IPC would learn are being reported by numerous IPC OEM Member companies.

There was so much interest in this white paper, a new subcommittee, IPC V-TSL-MVIA Weak Interface Microvia Failures Technology Solutions Subcommittee, formed in summer 2018 to begin investigating the potential causes of these failures and to provide industry resources on the topic.

Over the course of multiple web meetings, this group, representing the entire supply chain and numerous end-market segments, broke ground on an activity to begin to attempt to flesh out the potential causes of these interface failures to propose to industry solutions to address the issue.

During IPC APEX EXPO 2019 in San Diego, the subcommittee hosted an open industry forum to share its activities, its plans for bringing industry together to work on solutions to the problem and its planned path ahead. This meeting attracted 97 attendees, almost all of whom raised their hands, when asked by V-TSL-MVIA chair Marc Carter, SAIC, “Who has seen this issue in their products?”

Carter shared the activities of the subcommittee to date, which is focused on gathering existing, open data on the issue and querying industry for the types of data their companies collect on the issue.
Rather than reinvent the wheel, and to best advise IPC on if and how to progress with industry studies, the group will work to gather information in the public domain that could provide common clues regarding the interface failures. The group will compile this research into additional resources to be made available through the IPC Technology Solutions Committee through white papers and other resources.

In its efforts to get an understanding of existing data “behind the curtain” with companies, the subcommittee has also created a survey for industry that will provide the subcommittee information on types of data that could be available. These surveys are submitted to IPC staff and all company information is removed from them before being submitted to an agent of the subcommittee for compiling.

By understanding what data are already available, the subcommittee could then identify common denominators in data collected to request the actual data from industry for developing initial reports and to be able to best advise industry on round robins or other industry research initiatives that would fill the gaps in existing data.

Carter explained that the next step for the subcommittee is to break into A-Teams based on high-level topic areas from a fishbone diagram the subcommittee created. These A-Teams will gather and disseminate data to present reports on its findings back to the subcommittee. These reports can then be compiled into larger reports or resources for industry.

The A-Teams are:
• Simulation and Modeling
• Characterization and Test Methods
• Laminate Materials
• Construction Design Elements
• Metallurgy
• Chemical Processes
• Hole Formation
• Data Collection

Carter stressed that although this subcommittee is open to anyone to join, a requirement of being a member of the subcommittee is that your company will share information or expertise as active participants. Others in industry who simply want to learn and observe will be able to do so through additional reporting sessions, white papers and other resources and reports from the subcommittee.

Following Carter’s introduction, J.R. Strickland, one of the IPC-WP-023 co-authors, presented Microvia Weak Interface Failures: Current Understanding and Mitigation. Based on the research shown in the presentation, their conclusions are to not use more than two stacked microvias and that staggering the microvias can make them much more reliable. One of the most interesting findings in their investigation was when they attached an electrical probe to their test boards they put through reflow, they could spot the actual moment the microvia detached from the interface and then reattached before coming out of the oven. This detachment would not be recognized by electrical testing before and after reflow.

Motorola also indicated they have seen failures between copper fill and electroless, electroless and electrolytic and electroless to copper pad. You can view the Motorola slide deck here.

Happy Holden, who is disseminating blind survey responses submitted to IPC staff, presented on the fishbone diagram developed by the subcommittee and the types of data the subcommittee is collecting. He also presented the early results of the industry survey. You can view Holden’s data mining slide deck here.

How You Can Get Involved
People with interest in this topic should get a copy IPC-WP-023, which is available from the IPC store, and share their experiences with IPC by e-mailing me at ChrisJorgensen@ipc.org. The more IPC can learn about the scale of this issue and companies that are affected by it, the better.

As mentioned, the IPC V-TSL-MVIA Subcommittee is open to anyone to participate, but your company will be required to actively participate through data and information sharing and/or providing expertise on the topic. If you have interest in learning about the subcommittee and your expectations as a member of it, e-mail me at ChrisJorgensen@ipc.org.

March 1 Deadline for U.S.-China Deal Nears

By Chris Mitchell, vice president, global government relations

As the hours tick closer to the end of February, negotiators for the United States and China are attempting to solve in weeks trade and economic issues that have lasted for decades. Last week, U.S. Treasury Secretary Steve Mnuchin and Trade Representative Robert Lighthizer attended high-level trade talks in Beijing. According to the White House, the discussions focused on “structural issues, including forced technology transfer, intellectual property (IP) rights, cyber theft, agriculture, services, non-tariff barriers, and currency.” While there has been stated progress in some areas, the two sides appear to remain far apart on IP protection and technology transfer.

The seemingly constant negotiations are the result of the 90-day trade negotiation agreement, which ends March 1, approved by President Trump and President Xi after a meeting at the G20 on December 1. The agreement to negotiate halted further tariff action by both countries in the interim, including the planned increase of tariffs on $200 billion in Chinese imports, included in a third list of products targeted by tariffs that the Administration released last year, from 10 percent to 25 percent on January 1. While the tariffs remain at 10 percent, companies are not allowed to apply for product exemptions as they are with products on the first two lists of tariff-targeted products.

President Trump has long said that he will not agree to any deal until he meets with President Xi and that is not scheduled to take place before March 1, though some have suggested that a phone call could be sufficient for him. Prior to last week, President Trump and other Administration officials had been fairly adamant about refusing to consider extending the deadline, even if talks were going well. However, that rhetoric has begun to change with unnamed officials floating the possibility of a 60-day extension if progress continues to be made. We likely will not know if the tariff rates will increase or if the deadline will be postponed until immediately prior to Administrative action.

It is also important to note that any agreement and commitments will be contained in a Memoranda of Understanding, rather than a more formal agreement that could be subject to Congressional approval. There has been bipartisan support for the Administration’s attempt to address U.S.-Chinese trade issues, but some members have expressed concern about the end goal – and the ability of the Chinese to make systemic economic and political changes – in a matter of weeks, as well as the pressure continued tariffs are having on agriculture, small and medium sized businesses, and other constituent concerns.

Chinese officials are in Washington this week to continue talks.

IPC Launches Education Foundation to Strengthen Next Generation of Workers

IPC President and CEO John Mitchell discusses the IPC Education Foundation, an organization that focuses on strengthening and shaping the next generation of workers by preparing the talent pipeline and offering scholarships to deserving students.

Seven Takeaways from IPC APEX EXPO 2019

By Chris Mitchell, IPC Vice President of Global Government Relations

IPC’s most recent annual conference and trade show, IPC APEX EXPO 2019, took place in late January, and by all indications, it was among the best IPC shows ever! The overall success and quality of IPC APEX EXPO is a testament to the innovation and growth taking place in the electronics industry, as well as our members’ passion and commitment to standards development, learning opportunities, and pro-industry initiatives.

Here are my top seven take-aways from IPC APEX EXPO, from the perspective of someone whose job requires translating our highly technical industry into everyday language that policymakers and their aides can understand.

1. IPC Connected Factory Exchange (CFX) Takes Center Stage
IPC-CFX is an industry standard designed to serve as the digital backbone of electronics manufacturing companies. By simplifying and standardizing machine-to-machine communications, CFX is establishing a foundation for “Industry 4.0” applications. The surest sign of CFX’s success were the dozens of exhibitor booths sporting “CFX Supporter” placards. You couldn’t miss them on the showroom floor, nor could you miss the interest in the two full-scale CFX demonstration lines which hosted hourly tours throughout the week. To learn more, please visit www.ipc.org/cfx or contact IPC Vice President of Standards and Technology David Bergman.

2. Sector-Specific Initiatives Paving Way for New Innovation
In a sign of how critically important electronics are in supporting the growth and innovation of other industries, IPC APEX EXPO was the venue for a well-attended executive forum on the future of automotive electronics and a separate “buzz session” on e-textiles, as well as standards committee meetings related to both. As the automotive and textile industries integrate electronics into their products in ever more creative ways, they will rely on partners like IPC to establish the necessary standards to ensure high reliability and performance. Contact Sanjay Huprikar, IPC Vice President of Solutions to learn more about our work with the automotive industry, and Chris Jorgensen, Director of Technology Transfer, about our work with the textile industry.

3. IPC-1791 QML Program Poised for Significant Growth
Also at IPC APEX EXPO, the US Department of Defense’s Executive Agent for Printed Circuit Boards hosted its annual meeting, and IPC Director of Validation Services Randy Cherry was on hand to update participants on the development of IPC-1791, Trusted Electronic Designer, Manufacturer and Assembler Requirements and its associated Qualified Manufacturers List (QML) program. The IPC-1791 standard and QML program aim to establish a trusted supplier program focused around the design, fabrication and assembly of PCBs. The existing standard will get its first revision this month, and seven companies are now participating in the beta test audits. As DoD seeks to strengthen the security and reliability of its supply chain, the IPC-1791 standard and QML program will serve as a model for DoD-industry collaboration. To get involved, contact Randy Cherry.

4. IPC Launches Education Foundation and Inspires More Than 100 San Diego-Area Students
Perhaps the most fun event of the week came when IPC hosted more than 100 San-Diego-area high school students to APEX for panel discussions, hands-on training in soldering PCBs, and tours of the expo floor. These students were so inspiring—smart, curious, and attracted to careers in STEM fields. The IPC Education Foundation, which was launched during IPC APEX EXPO, will strive to help these students succeed. As two of its first initiatives, the foundation will be partnering with several organizations to distribute a basic electronics curriculum to hundreds of high schools, and it will be creating IPC student chapters at universities and community colleges across the country. Many thanks to the IPC member companies who helped make this event a huge success, including Calumet Electronics and Weller Apex Tool Group. To learn more and get more involved, contact Colette Buscemi, IPC senior director of education.

5. Tesla CTO and Co-Founder JB Straubel Offers Insights on Growth and Innovation
JB Straubel offered IPC APEX EXPO participants a captivating recounting of the Tesla story. Four big themes stood out. First, Tesla’s founding combined the profit motive with a desire to advance environmental sustainability. Second, developing its first roadster meant Tesla had to challenge every automotive norm, with little room for fallback options. Third, improving its cars today means weighing financial and technological trade-offs. And fourth, Tesla is focused on making smart strategic investments that leverage its technological leadership in markets that can be scaled up. All four of these points are relevant to IPC members who are looking to build upon their growth and technology leadership in a very competitive global economy.

6. 2019 Looks Good for the Electronics Industry
What’s the outlook for the electronics industry in 2019? A growing number of economists are voicing concerns about the possibility of major economies edging into recession as early as this year. Political turmoil in the U.S. and Europe, coupled with global trade disputes and a slowdown in China, are doing nothing to calm fears. However, the industry members I spoke to at IPC APEX EXPO felt pretty good about 2019. Sales remain strong, companies are hiring, and the supply chain is slowly adjusting to global uncertainty.

7. IPC Government Relations Expands its Global Reach and Grassroots Program
During our IPC Government Relations Committee meeting at IPC APEX EXPO, I shared that our public affairs program continues to expand in breadth, depth and geography. We are taking on new issues, including federal support for lead-free research, and we are doing so with greater support from industry experts and seasoned policy experts in the U.S. and Europe, with additional plans for long-term, strategic engagement in Asia in 2019. To get involved, contact me and/or sign up at the Advocacy Center on our website. You can also follow me on Twitter.

These were my top take-aways from my perch atop IPC Government Relations, but it cannot be said enough: The power of IPC APEX EXPO lies in the thousands of attendees who take part in standards committees, policy committees, executive forums, buzz sessions, and professional development. And of course, many thanks to the hundreds of companies who exhibited their goods and services and brought so much excitement to the show floor.

Political Uncertainties Raise Doubts on Both Sides of Atlantic

On both sides of the Atlantic, the political waters are turbulent, creating uncertainties about the opportunities for meaningful policy actions.

In Washington, D.C., things are getting back to “normal” after a five-week government shutdown that was prompted by President’s Trump demand for a US-Mexico border wall. To end that standoff, the White House and Congress agreed to reopen the government for three weeks – until February 15 – while negotiators work out issues related to border security.

Assuming a compromise can be reached on border security – which is not certain – Congress will devote the next several months to oversight hearings, the FY 2020 budget, the defense authorization bill and annual appropriations bills. Congress could advance an infrastructure bill, but enactment of a bill remains unlikely.

In Europe, 2019 will be a crucial year for EU policy making. The upcoming EU elections will take place without the UK and are expected to lead to a more fragmented European Parliament. New political alliances will affect the leadership of the next European Commission and the policy agenda of the next five years.

Speaking of the UK, the deadline for its exit from the EU is now less than 60 days away, with no agreed-upon deal to cover the many details. Now the EU and its Member States are beginning to implement emergency preparedness plans to address what could become a major disruption in the event of a no-deal exit.

Given the near-term uncertainties, we’re focusing on long-term initiatives, relationship building, and capacity building. As always, we will be monitoring the ongoing action on our key policy issues and advocating for your interests. Please contact Chris Mitchell if you have any questions or suggestions.

Tell Us Your IPC Member Story at IPC APEX EXPO 2019

IPC will soon roll out a new membership campaign that will focus on how the electronics industry builds the electronics that improve the quality of life for billions around the globe.

And we want help from IPC members.

Do you have a story to tell about how IPC membership has helped your organization consistently deliver high-quality, high-reliability products that keep us safer, more secure, improve our health or simply make our lives better? If so, we’d like to interview you onsite at IPC APEX EXPO 2019. We are seeking submissions, from which we will choose 8–10 people to record on camera in one-on-one sessions throughout the day on Monday, January 28.

If you are interested, please complete our online form. IPC will review submissions and reach out to those selected by Sunday, January 27, to schedule your session and provide additional details. Please note: you must already be registered for IPC APEX EXPO 2019 to participate.

Thank you in advance for your interest!

The IPC Membership Team