To address this problem, Congress passed the Consumer Product Safety Improvement Act (CPSIA) in August, 2008. Among other things, the CPSIA bans lead in toys, mandates third-party testing and certification for all toys, and requires toy makers to permanently label each toy with a date and batch number.
Large manufacturers can meet the new requirements fairly easily, but compliance costs will be prohibitive for small manufacturers. According to the Handmade Toy Alliance:
For small American, Canadian, and European toymakers...the costs of mandatory testing will likely drive them out of business.
A toymaker...who makes wooden cars in his garage in Maine to supplement his income cannot afford the $4,000 fee per toy that testing labs are charging to assure compliance with the CPSIA.
A work at home mom in Minnesota who makes dolls to sell at craft fairs must choose either to violate the law or cease operations.
A small toy retailer in Vermont who imports wooden toys from Europe, which has long had stringent toy safety standards, must now pay for testing on every toy they import.
And even the handful of larger toy makers who still employ workers in the United States face increased costs to comply with the CPSIA, even though American-made toys had nothing to do with the toy safety problems of 2007.
It's not only handcrafters and startups who won't be able to meet the new compliance costs. Selecta Spielzeug, a well-established German producer of high-quality wooden toys, has announced that they must stop exporting to the U.S. due to the new regulations. Take a look at their products and decide for yourself how dangerous these toys are to children.
This is the coincidence that happens too often to be coincidence: Under the guise of consumer protection, legislators enact laws favorable to the special interests that pay them, at the expense of competitors, small businesses, startups, and consumers. Funny how that works, isn't it?