(b) Firewalled. A third party conformity assessment body must apply for firewalled status if:

1. (1) It is owned, managed, or controlled by a manufacturer or private labeler of a children's product;

   1. (i) For purposes of determining whether a third party conformity assessment body is firewalled, “manufacturer” includes a trade association.

   2. (ii) A manufacturer or private labeler is considered to own, manage, or control a third party conformity assessment body if any one of the following characteristics applies:

      1. (A) The manufacturer or private labeler of the children's product holds a 10 percent or greater ownership interest, whether direct or indirect, in the third party conformity assessment body. Indirect ownership interest is calculated by successive multiplication of the ownership percentages for each link in the ownership chain;
      2. (B) The third party conformity assessment body and a manufacturer or private labeler of the children's product are owned by a common “parent” entity; or
      3. (C) A manufacturer or private labeler of the children's product has the ability to appoint any of the third party conformity assessment body's senior internal governing body (such as, but not limited to, a board of directors), the ability to appoint the presiding official (such as, but not limited to, the chair or president) of the third party conformity assessment body's senior internal governing body, the ability to hire, dismiss, or set the compensation level for third party conformity assessment body personnel, regardless of whether this ability is ever exercised;
2. (2) The children's product is subject to a CPSC children's product safety rule that the third party conformity assessment body requests CPSC acceptance to test; and
3. (3) The third party conformity assessment body intends to test such children's product made by the owning, managing, or controlling entity for the purpose of supporting a Children's Product Certificate.

(c) Governmental. Governmental third party conformity assessment bodies are owned or controlled, in whole or in part, by a government. For purposes of this part, “government” includes any unit of a national, territorial, provincial, regional, state, tribal, or local government, and a union or association of sovereign states. “Government” also includes domestic, as well as foreign entities. A third party conformity assessment body is “owned or controlled, in whole or in part, by a government” if any one of the following characteristics applies:

1. (1) A governmental entity holds a 1 percent or greater ownership interest, whether direct or indirect, in the third party conformity assessment body. Indirect ownership interest is calculated by successive multiplication of the ownership percentages for each link in the ownership chain;
2. (2) A governmental entity provides any direct financial investment or funding (other than fee for work);
3. (3) A governmental entity has the ability to appoint a majority of the third party conformity assessment body's senior internal governing body (such as, but not limited to, a board of directors); the ability to appoint the presiding official of the third party conformity assessment body's senior internal governing body (such as, but not limited to, chair or president); and/or the ability to hire, dismiss, or set the compensation level for third party conformity assessment body personnel;
4. (4) Third party conformity assessment body management or technical personnel include any government employees;
5. (5) The third party conformity assessment body has a subordinate position to a governmental entity in its external organizational structure (not including its relationship as a regulated entity to a government regulator); or

6. (6) Apart from its role as regulator, the government can determine, establish, alter, or otherwise affect:

   1. (i) The third party conformity assessment body's testing outcomes;
   2. (ii) The third party conformity assessment body's budget or financial decisions;
   3. (iii) Whether the third party conformity assessment body may accept particular offers of work; or
   4. (iv) The third party conformity assessment body's organizational structure or continued existence.