Japan’s SDS Rule Signals Global Shift for U.S. Firms

Beginning April 1, 2026, Japan will allow companies to use substitute chemical names in Safety Data Sheets (SDSs) under revisions to its Industrial Safety and Health Law (ISHL). The change, designed to balance trade-secret protection with worker transparency, will also ripple through U.S. compliance frameworks—particularly for chemical exporters and OSHA’s pending Hazard Communication Standard update.

Japan’s Policy: Protecting IP Without Sacrificing Safety

Japan’s Ministry of Health, Labour and Welfare (MHLW) is finalizing two draft documents that define how companies can use alternative chemical names in SDSs if a substance poses low risk to workers.

• Ministerial Notification – sets eligibility criteria for substitute naming.
• Implementation Guidelines – outline how to construct substitute names by omitting or replacing parts of a chemical’s structure.

Substances must meet strict hazard thresholds under Japan’s GHS classifications, excluding chemicals with acute toxicity (Categories 1–3), carcinogenicity, reproductive toxicity, or severe irritant effects. The final rule is expected in December 2025, with enforcement starting April 1, 2026.

Why It Matters to U.S. Manufacturers

For American companies exporting to Japan—especially those in specialty chemicals, coatings, semiconductors, or advanced materials—this rule marks a turning point in how proprietary ingredients can be disclosed abroad.

Under Japan’s new approach, exporters can use a substitute name that partially conceals a compound’s structure while maintaining hazard transparency. That gives U.S. manufacturers a legitimate pathway to protect confidential business information (CBI)—a growing concern amid stricter disclosure demands in Asia and the EU.

However, the move also adds compliance complexity:

• Dual SDS management: U.S. companies will need SDSs aligned to both OSHA’s HCS (GHS Rev. 3) and Japan’s ISHL (GHS Rev. 8).
• Data documentation: Firms must retain internal records demonstrating why a substitute name was used, mirroring OSHA’s trade-secret affidavit model.
• Hazard alignment: Japan’s system uses different concentration thresholds and classification updates, requiring revalidation of mixture data.

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Regulatory Ripple Effects: Pressure on OSHA

Japan’s policy introduces something the U.S. system still lacks: a formal mechanism for substitute chemical names that preserve transparency and trade secrets simultaneously.

Currently, OSHA’s Hazard Communication Standard (29 CFR 1910.1200) allows companies to withhold a chemical’s specific identity or exact concentration if it’s a trade secret—but it doesn’t provide structured rules for substitute naming.

That gap may soon narrow. OSHA’s long-awaited HazCom 2025 update, now under White House review, aims to align U.S. requirements more closely with GHS Rev. 7. Industry groups like the American Chemistry Council (ACC) and Society of Chemical Manufacturers & Affiliates (SOCMA) are already citing Japan’s model as evidence that “alternative naming” can strengthen compliance without compromising safety.

Global Trend Toward Harmonized Hazard Disclosure

Japan’s move reflects a broader evolution in chemical management:

• EU (CLP Article 24): Companies must apply to ECHA for permission to use alternative names.
• Canada (WHMIS 2022): Allows substitute names under specified conditions.
• U.S. (OSHA): Still relies on generic trade-secret protections without structured substitute naming.

By implementing a self-administered system based on hazard thresholds, Japan has positioned itself between the EU’s approval-heavy model and the U.S.’s open trade-secret system. That balance may soon define global best practice for chemical communication and IP protection.

Beyond compliance, the rule introduces new complexity for ESG reporting and Scope 3 chemical traceability. Even when chemical names are substituted, hazard classifications must remain visible on SDSs—ensuring transparency for investors, customers, and auditors using product data in sustainability reporting.

Japan’s ISHL revision underscores a global shift toward harmonizing trade-secret protection with transparent hazard disclosure. For U.S. exporters, it signals the need to modernize SDS data systems and anticipate similar updates as OSHA revisits its own Hazard Communication Standard.