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SGMA Changes its name after 107 years to Sports and Fitness Industry Association (SFIA)

Dear Members and Friends of SGMA:

For the past 107 years, the Sporting Goods Manufacturers Association (SGMA) has been your source of research-based knowledge, a leader in professional development, the sports and fitness industry’s voice and advocate on Capitol Hill, and the community on which you rely to address common challenges and take collective action.

We all recognize the rapid and deep change our industry has experienced in recent years. As our industry evolves, our organization has identified the need to realign our positioning, communications and service offerings. Thus, following careful deliberations based on an extensive strategic planning process, the SGMA Board of Directors has approved a complete rebranding process for our Association. I’d like to walk you through some of these exciting developments:

Transition of Our Name – SGMA to SFIA

The SGMA Board of Directors has approved a new name for our organization: Sports & Fitness Industry Association, with the acronym SFIA.

Our research and personal experiences indicate that common understandings of “sporting goods” and “manufacturers” have evolved while our terminology has not. Thus, the change from “Sporting Goods” to “Sports & Fitness” is more definitive about our inclusion of brands connected to fitness and active lifestyle products. The change from “Manufacturers” to “Industry” embraces a broader community including suppliers, brands, major sports and fitness retailers and partners – a much clearer reflection of our current and future membership. This is not a change in philosophy for our organization as we already have many members in these categories. It is simply a more accurate and transparent indication of the industry segments that we serve. And while we continue to embrace, celebrate and support the many companies who manufacture their own products, our general membership (including many of those manufacturers) has indicated that there is a need to move beyond the traditional label of a “manufacturers” association.

Formal Ratification of the Name Change

While the Board has approved all of the elements connected to the overall rebranding, changing the name of SGMA requires a vote of the membership, which will be done by proxy and ratified at the SGMA Annual meeting this fall.

This Is About Much More Than a Name Change: New Industry Initiatives

This rebranding process is about much more than a name change. It starts with the basics—a laser focus on the new mission statement developed by our Board of Directors: To Promote Sports and Fitness Participation and Industry Vitality. It is a reflection of a broad Board-driven, multi-year strategic planning process that instills a disciplined focus on four core offerings: Thought Leadership & Events, Public & Industry Affairs, Member Services and Research Insights.

Specifically, we are working hard to enhance our member offerings with the launch of several initiatives including:

  • New Thought Leadership initiatives including the 2013 SFIA Industry Leaders Summit, scheduled for September 25-26, 2013.

  • A national campaign to grow sport and fitness participation: PHIT America

  • A new “member friendly’” website: http://www.SFIA.org

  • A comprehensive SFIA Supplier Directory

  • A groundbreaking new “Grassroots Sports Participation in America” research report

  • Content enhancements and design updates to our weekly e-newsletter, InBrief

  • Major upgrades to our Product Testing member benefit

You will learn more about these initiatives in the coming weeks. In the meantime, for more information, please visit the FAQ section on our website.

I want to emphasize that the foundation of our organization and the core constituents who benefit from their affiliation with our organization remains the same. The rebranding process simply helps us articulate a more accurate picture of who we represent and how we bring value to those entities while simultaneously identifying our members’ most pressing issues and providing resources that help address those problems.

In short, this is a very exciting time in the long, proud history of our trade association. The rebranding process is an important example of our ongoing commitment to fulfilling our organization’s mission. We remain universally committed to our most significant priority: to continue developing and delivering products, resources and events to our members that help enhance their businesses. The upcoming name change and the rollout of our new services and initiatives are a strong reflection of our continued commitment to fulfilling our leadership role in this great industry.

Thank you for your continued investment in SGMA as we transition to the newly branded Sports & Fitness Industry Association. As always, our staff remains proud to serve the sports and fitness community and the outstanding individuals who work in this industry.

Larry Franklin

Tom Cove

Chairman of the Board

President & CEO

Sporting Goods Manufacturers Association

Sporting Goods Manufacturers Association

Mission: To Promote Sports and Fitness Participation and Industry Vitality

Corporate Philosophy: We believe sports and physical activity enhance people’s lives. By providing tangible value to our member companies, SGMA promotes and supports the sports and fitness
industry’s growth, profitability and importance.

SGMA * 8505 Fenton Street, Suite 211 * Silver Spring, MD * 20910 * p: 301.495.6321 * www.sgma.com

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Critical Dates Regarding the New Consumer Product Safety Improvement Act

November 12th is the First in a Series of Critical Dates Regarding the New Consumer Product Safety Improvement Act (CPSIA)

SGMA Members are being alerted now to act with all due speed. Non-compliance with the Act may put your company at risk for monetary and possible criminal violations.

SGMA and our Legal Task Force are in communication with the CPSC and attend all Commission meetings and hearings that pertain to issues affecting you. The following are some of the most pressing deadlines and issues that you need to be aware of and address immediately:

• On November 12, 2008 all products subject to the CPSIA bans and standards as well as subject to any similar rule, ban, standard or regulation under any other Act enforced by the Commission, must be self-certified with a General Conformity Certification.

• The General Conformity Certificate must be based on a “test of each product or upon a reasonable testing program.”

• Certificates must accompany each product or shipment of products covered by the same certificate. And, a copy of the certificate must be furnished to each and every distributor and retailer of the product.

• If a General Conformity Certificate does not accompany each imported product or product shipment then all of your products “shall be refused admission.”Products refused admission can be destroyed!

• The Commission warned that each company needs to go through a detailed analysis of its products to determine whether your products are subject to the CPSIA’s new self-certification requirements.

It is imperative for your company to do a thorough product analysis. Do not delay! Call SGMA or our Legal Task Force members for advice immediately.

This ALERT is merely a tip of the iceberg with respect to what SGMA members must do to comply with the CPSIA and its rolling dates over the next 2-3 years. To keep you well-informed SGMA’s Legal Task Force will have another conference call on October 27, 2008 to update you on the most pressing deadlines and issues involving the CPSIA and the up-to-date thinking of the Commission. Details regarding the call will be emailed shortly.

SGMA members can visit www.sgma.com for further CPSC details and to access a CPSC Improvement Act Recap PowerPoint Presentation that summarizes the issues that were discussed during the September 11th CPSC Conference Call that SGMA hosted. Members can also contact Chris Strong, SGMA’s Director of Business Development, at 202.349.9413 or cstrong@sgma.com.


SGMA’s Consumer Product Safety Improvement Act Conference Call

SGMA’s Consumer Product Safety Improvement Act Conference Call

September 11, 2008

AGENDA

Black is the original Agenda from the SGMA

Red is my notes from the conference call

Blue are hyperlinks

Introduction and Welcome

    Tom Cove, President and CEO of SGMA

    Mark Granger, Partner, Morrison Mahoney LLP

Overview of CPSC Act

    Paul Rosenlund, Partner, Duane Morris LLP

  1. Very interested in sporting goods and athletic product in general.
    1. Does surveys and statistical surveys of product related injuries and deaths and because sporting goods are at the top they are watched.
  2. Substantial powers over all manufactures, importers, retailers; everyone in the chain of distribution
  3. Products:
    1. Any product sold to the consumer at a household, school or recreation or otherwise
      1. Exception is those governed by other federal agencies
        1. Vehicles
        2. Food & drugs
        3. Airplanes
      2. Some overlap in
        1. Child seats
        2. PFD’s
  4. CPSC job is to review any death and gather of data
    1. Survey’s emergency room info
    2. Consumer reports
    3. Plaintiff’s reports
    4. Manufactures voluntary reports
      1. Voluntary under the law
  5. Enforce better reporting from manufactures
    1. More penalties for manufactures who don’t report on time
  6. How to deal with imports
    1. The proportion of recalls are now imports
  7. New act triggered due to toy recalls but went beyond that
    1. $15 mill can be levied for some penalties
    2. Lower burdens of proof for criminal prosecution
      1. Knowingly imports or manufactures a safety rule
    3. New whistleblower protection for employees to violate
      1. Can’t be fired or have pay reduced
  8. Definitions
    1. Manufacture: any person who manufactures or imports a product
    2. Distribution in commerce: prohibits distributing something commerce. Sell, deliver or even hold for sale for distribution in the future.
    3. Children’s product: children 12 years of age or under

Compliance with and Implications of Phthalate and Lead Restrictions    

Gary Wolensky, Partner, Snell & Wilmer LLP

  1. Section 108 bans all Phthalate in all children’s toys
  2. Child defined as a toy Designed for child 12 years or younger for use when a child plays
    1. Goes into effect 2/12/09
    2. Sporting goods do not fall under the definition of a toy under the act according to the CPSC
  3. Sporting goods are still subject to a lot of new and amended provisions under the act
  4. If a product is a toy under Section 108
    1. Then you must determine that your toy not have more than 1% phthalate (.1% of the total weight or total volume of the product)
  5. You must self certify for at least until 9/09 you must self certify because the rules will not be out yet
  6. Section 101, Lead
    1. Rules go into effect automatically.
      1. 8/14/08 signed so effective 9/13/08 and rules must be issued by this date
      2. 180 days after the act or 2/13/09 new 600 ppm lead limit goes into effect
      3. 365 (1 year) new 300 ppm lead goes into effect and paint goes down to 90 ppm
        1. New lead limits on inaccessible parts and components
      4. 3 years lead limits go down to 100 ppm if technological feasible
        1. Applies to parts individually
          1. Each component will be evaluated separately
    2. Once it becomes mandatory you will be required to test you products for soluble lead

Third Party Certification

    Mark Granger, Partner, Morrison Mahoney LLP

  1. Right now there are only 20 labs in the US that can comply with the requirements for self certification.
    1. There is going to be a big crunch
      1. Labs have to get their applications in now
        1. Deadline is November
      2. If request is not in before the November they will not be accredited
    2. Accreditation is a list of rules on testing
  2. Labs must be out of reach of the manufactures influence
    1. Must be totally independent
  3. Products will not be let into the US without the certifications
    1. There will be a new import surveillance group to check on these products

Label Tracking and Certificates

    Bruce Cranner, Partner, Frilot LLC

  1. Certifications
    1. The act requires that manufactures or labels create a certificate for their products
    2. Two types
      1. A general certificate created by the manufactures based on a 3rd party test or a reasonable testing program that complies with the regulations
      2. Certificate must state the rules, regulations or certifications the label is complying with
      3. Comes into play with 90 days of the act (mid November)
      4. Can be done based on a reasonable testing program
    3. Children’s products certificate
      1. Conforms with the act
      2. Tested by a third party
      3. Must be issued for each children’s product
        1. Lead
        2. Metal jewelry
      4. Must contain
        1. Date and place of manufactures
        2. Date and place of testing
          1. How it was tested
          2. Who tested
        3. Must be available to the buyer of the product
        4. Must be turned over to retailers upon request
        5. Available to turned over to the CPSC or the commissioner of customs
          1. System to file 24 hours before the arrival of the certificate product
    4. New requirement that manufactures tag and label children’s product
      1. Includes the packaging of the product
        1. Must contain distinguishing marks on the product
          1. Batch
          2. Lot
          3. Manufactures date & time
          4. Manufactures location
        2. Ultimate purchase must be able to ascertain
          1. Manufactures date & time
          2. Manufactures location
          3. Batch and lot number
        3. All on the product and the packaging
      2. By 2/14/09

Inventory Issues

    Paul Rosenlund, Partner, Duane Morris LLP

  1. Area with a lot of gray on what, when and where
    1. A lot of the deadlines will slide based on when the CPSC issues the regulations
  2. CPSC did issue preliminary deadlines on an excel spreadsheet
  3. Xmas time proposed deadline for lead
  4. Labels 1 year after deadline after the date of enactment
  5. Toy safety standard F9 63-07 apply to all products manufactures after 2/10/09
  6. Lead is effective immediately and applies to existing inventory
  7. Phthalate applies 100 days after enactment, 2/10/09 to all products distributed in commerce
    1. Effectively if too much Phthalate must be destroyed or fixed after 2/10/09
      1. The act prohibits selling, exporting or distributing
  8. 3 wheel all terrain vehicles banned now!
  9. 4 wheel all terrain vehicles new rules
  10. 90 day testing??

Question and Answer Session

    E-mail Mark Granger at MGranger@morrisonmahoney.com with any questions     you would like to have discussed at this time.

What about state rules and regulations that are more stringent than the Federal rules

    Gary Wolensky: state law will not be pre-empted by the federal act. State law will still apply, except for Phthalate.

    The act is it pre-emptive by CA Proposition 65

Any damage claims (plaintiff’s claims) is still based on state law

Sporting good designed for educational use, is that a toy?

    Gary Wolensky: Get advice, go through the product and product line and figure out whether the article is sporting good or something else.

    Personal use, consumption use or enjoyment in or around personal residence, school recreation or otherwise

What about certifications provided by foreign countries?

    Barring some sort of treaty or CPSC agreement those certifications will not work and must be certified under US rules

    Not just a function of what the product is made of

        Small parts

        Children’s products

        Everything will require 3rd party certification

    You will need to find lawyers skilled in this and independent labs skilled in this

Paul Rosenlund: there will be a separate set of rules for foreign labs

    EU standard will not exempt you from the CPSC

Is children’s footwear children’s toys?

    Arguably under the definition it is a consumer product and used to play.

    Can it end up in the kid’s mouth, then it might be a toy

Inaccessible parts made of Phthalate or lead?

    Inaccessible part the issue is the part really inaccessible? You are comparing the percentage concentration to the totality to the product whether accessible or not.

Probably specific regulations on accessible issues

How do I tell if I am a child’s product toy or just a sporting good?

    Clearly sporting goods fall within the definition of child’s products

    The critical inquiry is “is your product a toy or sporting goods”

        Look at the intended use

        Look at the advertising and marketing

        Is it used in team sports or individual sports

        Is it cute, colorful etc is a toy

        Are your instructions, warnings, etc aimed at a child above age 12?

        Do the instructions say only for use by children over age 12?

Certificates?

    A lot of information is not known yet on labels and certificates. Waiting on CPSC to provide more guidance.

    Everyone who manufactures a product must be on the certificate

        Where it came from, who manufactured it

    Tracking label must provide opportunity for the ultimate purchase to determine manufactures date time and location and batch run and time.

Paul: another provision of the act CPSC now has authority without a complaint or investigation the right to ask any importer retailer or manufactures for all supply chain information including component suppliers.

Gary W. as of this morning on the CPSC the PowerPoint’s are up from the presentations made by the CPSC last week.

Ended at 12: 30 PM MST

SGMA Conference Call Sponsored by:

KEY CONTACT INFORMATION

Bruce Cranner     Mark Granger      Tom Cove

Frilot LLC     Morrison Mahoney LLP             SGMA

504.599.8151         617.439.7518          202.349.9422


BCranner@frilot.com
MGranger@morrisonmahoney.com
TCove@sgma.com

 

Paul Rosenlund     Gary Wolensky             Bill Sells

Duane Morris LLP     Snell & Wilmer LLP             SGMA

415.957.3178     714.427.7022          202.349.9417


PSRosenlund@duanemorris.com
GWolensky@swlaw.com     BSells@sgma.com