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.

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.”

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.

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 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. https://www.youtube.com/watch?v=d0hNwcaCKG4

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.

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.

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

by David Bergman, vice president, Standards and Training If you had the chance to align your EMS facility with Industry 4.0, set up seamless data communication between all equipment on your line – even conveyors – and be able to track production on all the equipment from any part of the world, would you do it? If you are a machine vendor, would you like to get out of the business of developing and managing bespoke interfaces for your customer? As an OEM, what would you think about one communication software to provide an added dimension over real-time control of product quality, from board assembly to box build? What if I told you the entry cost for such a communication-enabling software is available at the low, low IPC price of exactly zero dollars? Would it sweeten the deal if I told you that you could plug this software into your existing line in one day? IPC CFX communication software for smart production (IPC-2591) and HERMES standard for machine-to-machine communication (IPC-HERMES-9852) are industry-developed standards forming the foundation and backbone of Industry 4.0 Applications. IPC CFX-HERMES simplifies and standardizes machine-to-machine communication while also facilitating machine-to-business and business-to-machine solutions. During IPC APEX EXPO 2019 in San Diego, California, January 29-31, 2019, IPC will demonstrate two live production lines using this standard software in the IPC Digital Factory on the show floor. One line will utilize both HERMES for machine-to-machine communication and CFX for output messages to the cloud, and the second line will utilize CFX. The HERMES-CFX line will run printed boards of different sizes through the following process sequence using equipment from a variety of manufacturers. We will use boards of different sizes so you can see the power of HERMES, as it communicates upstream to equipment so it can automatically adjust for the new board size. The CFX line will run the same boards through a separate line, and it will use additional equipment as a demonstration of the compatibility of the software. You will also be able to follow both production lines—in real time—from your mobile device. This will provide you a real-world view of how you will be able to utilize the data reporting from CFX and HERMES in your own facilities. HERMES-CFX line sequence Laser marker – ASYS Group Screen printer – ASM Solder paste inspection – Saki Pick and place – Kulick & Soffa Reflow oven – Heller Post-over conveyor – Nutek Post-reflow AOI – Koh Young X-ray – Test Research, Inc. ICT – Keysight Output conveyor – Nutek CFX line sequence Input conveyor – Flexlink Dispense robot – OK International Solder paste inspection – Koh Young Pick and place – Fuji Reflow oven – Heller Post-oven conveyor – Flexlink Post-reflow AOI – Pemtron X-ray – Creative Electron Buffer conveyor – Flexlink Inspection conveyor – Flexlink Rework center – OK International Each line will run throughout each day of IPC APEX EXPO, so you will have time to see for yourself the simplicity and power of IPC CFX and HERMES. For instance: It provides a level playing field for smaller companies Because this is an industry standard and available at no cost, with very little work to be done to implement, you can use the same software as larger, globally located companies. All manufacturers will save time and money Developing your own communications software, especially for multi-vendor equipment lines, can cost upwards or $30,000 and take up to a full business quarter to implement. IPC CFX and HERMES are free to industry and can be implemented in a day. Reduce or eliminate customer follow-up for software issues One of the IPC Connected Factory Initiative Subcommittee members, who works on the software development side, communicated the ease of CFX and HERMES implementation. He directed one of his customers to the software and the customer loaded and implemented it without the need for technical support. The software serves as a building block for enhanced production tracking IPC CFX and HERMES are written in a way that a company can very easily and inexpensively add app-like functionalities for such things as materials traceability or quality improvement. Adaptable enough for even hand soldering tools One of the Digital Factory participants, OK International, found a way to make CFX, which was written for MS .Net, work in Linux. Not only does this present even more possibilities for industry participation, they even implemented it into hand soldering tools. On-demand, real-time data on any piece of equipment worldwide EMS companies looking to place orders or report to OEM customers on project statuses will be able to see the activity of any piece of equipment in any facility in any part of the world from their computer or handheld device. These are just a handful examples of the simplicity, value and power of IPC CFX and HERMES. Visit the IPC Digital Factory during IPC APEX EXPO 2019 to see these standards in action. IPC Digital Factory San Diego Convention Center – Sails Pavilion Tuesday, January 29, 10:00 AM to 6:00 PM Wednesday, January 30, 9:00 AM to 6:00 PM Thursday, January 31, 9:00 AM to 2:00 PM Join the IPC 2-17 Subcommittee Meeting at IPC APEX EXPO You can learn more about these two standards and how you can shape their direction by attending the 2-17 Connected Factory Initiative Subcommittee meeting during the show. The subcommittee will meet Monday, January 28, 8:00 AM to 12:00 PM in room 17A at the convention center. The meeting is open to anyone. For more details about IPC CFX-HERMES, the live production line or the 2-17 meeting, e-mail me at DavidBergman@ipc.org.

by Ken Schramko, senior director, North American government relations You have probably seen news reports about the various ways that the U.S. Government partial shutdown is affecting "regular people." So we were wondering: How it is affecting the electronics industry, if at all? How is it affecting your company? Please help us by taking a minute now to answer an IPC survey on this issue. Your answers will help us understand the situation better and advocate on your behalf. We’ll publish the results here in about 7-10 days and alert you in an upcoming edition of IPC Global Insight, IPC's weekly e-newsletter. In the meantime, this two-page document from our colleagues at Prime Policy provides an overview of which government agencies and functions are most affected. To cite just a few examples: About 95% of the U.S. EPA’s staff are on furlough; as are about half the staff at the White House office that reviews and approves pending regulations. The State Department will keep issuing passports and visas until they run out of funds; and taxpayers will not have services to help with taxes.