REACH: A Thorn in the side of the Chemical Industry?

Nicolas Garderes, a French attorney specialising in environmental and European law with the international law firm Denton Wilde Sapte, writes in GCI Magazine of the challenges faced by manufacturers who are now required to meet the terms of the EU chemicals regulation called REACH (Registration, Evaluation, Authorisation and Restriction of Chemical Substances). Nicolas suggests that whilst larger companies have made investments in compliance with REACH for the most part, small and mid-size companies are struggling to deal with the regulatory issues involved. 

Nicolas also points out that the US “is clearly one of the countries most interested in the possible softening of REACH deadlines.” The US lobbied actively to get REACH watered down and after the regulation was enacted the industry was reluctant to get involved with the legislation.

Throughout the process of REACH being drafted representatives of the chemicals industry have aired their concerns about job losses, the increased costs of raw materials, difficulty finding alternative chemicals and trade barriers - potentially leading to businesses moving away from Europe. 

The U.S. government in collaboration with the American chemical industry have put phenomenal pressure on European governments, which partially paid off as Tony Blair, Gerard Schroder and Jacques Chirac persuaded the European Commission to water down the proposals.¹

Under the Clinton Administration it was U.S. policy to avoid intervention in the endeavours of other countries to safeguard their environment. Vice President Al Gore stated, “We recognize and respect each nation’s right to set legitimate public health and environmental standards and to take appropriate precautionary action.” In contrast the Bush Administration scrapped this approach. Administration officials came together with the U.S. chemical’s industry to ascertain their concerns regarding REACH.

In March 2002, Secretary of State Colin Powell contacted U.S. diplomatic posts, instructing them to “raise the EU chemicals policy with relevant government officials,” and oppose the REACH proposal as “a costly, burdensome, and complex regulatory system.” The Administration’s complaints and pressure placed on EU nations resulted in revisions to the proposed legislation. As a U.S House of Representatives Committee on Government Reform document highlighted, “The chemical industry is one of President Bush’s biggest political supporters….Members of the public and environmental organisations…had no comparable opportunities to shape U.S. policy.”²

The European Chemical Industry and several EU Member States also aired their complaints about REACH seeking dilution and in some cases rejection of the legislation. The European Chemicals Industry Council (CEFIC), made up of 40,000 chemicals companies, condemned the suggested adoption of the precautionary principle, favouring a risk-based approach, whereby substances are only tested once they have been shown to be dangerous.

It has been speculated that many US companies have not complied with pre-registration and we will have to wait and see whether US companies will comply with communication requirements that came into force in October 2008. Fifteen substances have already been earmarked for authorisation because they have been classified as very toxic. The EU is thus encouraging companies to seek safer alternatives. Non-compliance can result in a ban of the product on the EU market, due to the “no data, no market” rule. See below for more information on the REACH legislation. 

Background to REACH

A patchwork of over 40 pieces of chemicals legislation has, in the past, made for poor regulation of commonly used chemicals. A distinction has been made between “existing” chemicals put on the market before 1981 (consisting of around 100,106 substances) and “new” chemicals put on the market after 1981 (consisting of over 4,000 substances). New substances (i.e. after 1981) have been subject to testing, even if the manufacturer or importer only produces or imports 10 kg per year and the authorities must be notified prior to marketing them. Existing chemicals, however, have not been subject to testing. This means that it has been easier and cheaper for manufacturers to continue using the old chemicals that have not been tested for safety, rather than developing new and potentially safer ones.

In 1993 the EU started to assess the risks of the 100,000 “existing” chemicals with no, inadequate or limited toxicity data, beginning with high production volume chemicals (produced in quantities exceeding 1,000 tonnes per year), but this is not a swift process and the risk assessments necessitate comprehensive information and data, which is rarely available. Comprehensive toxicity testing of just one substance can cost up to ECU 15 million (ECU refers to the European currency unit prior to the EURO).

Around 99 per cent of chemicals are used in consumer products despite inadequate safety information with regards to their effects on human health and the environment. Comprehensive risk assessments of the existing substances have been the responsibility of the public authorities, rather than the manufacturers, importers or those using the chemicals in their products. The risk assessments do not focus on the way the chemicals are used in particular areas.³ Identifying and assessing risks, along with introducing measures to deal with them has been a very slow and laboured process.⁴Over the past 30 years less than 200 substances have been adequately assessed,⁵ leaving humans and the environment continually exposed to hazardous and potentially hazardous chemicals.

Although importers and manufacturers of chemicals are obliged to file information on the chemicals, downstream users are not, unless the chemicals require classification. Therefore, information on the usage of substances is difficult to come by. The average consumer is left in even more of an information desert. According to the European Chemicals Bureau, only 14 per cent of the highest production volume chemicals have a publicly available set of hazard data (as defined, but not necessarily required, in EU existing law).⁶

The flaws, or rather gaping holes in the patchwork of around 40 pieces of existing chemicals legislation has become ever more apparent over the years and in 1998 the EU begun debating a new system. After a number of stakeholder debates a White Paper, entitled “Strategy for a Future Chemicals Policy” was published in February 2001 proposing a new system, “Regulation, Evaluation and Authorisation of Chemicals,” (REACH). Both Council and Parliament supported the proposal. The draft REACH regulation was finally published in October 2003, after five years of debate.

REACH only applies to the environmental effects of chemicals used in cosmetics, it was agreed that the Cosmetic’s Directive would remain, although it is currently under review. According to the EU Commission there is uncertainty as to the quantity of cosmetic ingredients, coming with the scope of the REACH registration but figures have indicated that around 70 per cent of all cosmetic ingredients will be affected by the registration of REACH because they are produced or imported in quantities exceeding 1 ton per year.⁷

The Revelation of REACH

REACH (not for the stars but the Regulation, Evaluation and Authorisation of Chemicals) legislation is a major new system established to evaluate numerous chemicals for their effects on human health and the environment and to encourage the replacement of hazardous chemicals with safer alternatives. It was presented by the European Commission on 29 October 2003, agreed by the European Parliament and Council of Ministers on 18 December 2006 and came into force in June 2007, in the EU and its Member States. REACH potentially applies to all businesses that use chemicals and replaces about 40 different pieces of legislation. The declared aims of the reforms are to improve protection of human health and the environment from the risk of chemicals, while enhancing the competitiveness of the EU chemicals industry.

Over the next 11 years approximately 30,000 chemicals currently in use will have to be registered according to a set timetable. As far as consumer products go, REACH takes into account the human and environmental impact of chemicals used in the products and packaging.

The onus for demonstrating the safety of a substance falls on the industry itself and the ‘no data, no market’ rule applies, so if companies fail to submit safety data on a substance, they should not manufacture nor place it on the market. It was the case prior to REACH that the burden of proof rested with the authorities, who could only restrict or prohibit chemicals if they could demonstrate actual or potential harm to humans and the environment. Now producers and users will have to prove the safety of thousands of products.

Importers and producers of chemicals in volumes of or exceeding 1 tonne per year will have to register them with the new European Chemicals Agency (ECHA) based in Helsinki. Registration involves providing safety data and information on expected uses of the chemicals. Higher volume and more hazardous chemicals will be registered first and will require more detailed safety information than lower tonnages (i.e. 1 – 10 tonnes). The requirement to register began on 1 June 2008, but for most existing substances, if producers pre-registered prior to 1 December 2008, registration is panned out over 11 years to 2019 depending on the volume of chemicals produced. If a manufacture or producer fails to register a substance they will not be permitted to manufacture or import it.

Over the coming years persistent and bioaccumulative chemicals will be substituted if safer alternatives exist. Under this new system, producers and importers will have to provide more detailed safety information than under previous legislation, to downstream users – anyone who uses a chemical as part of their profession or industrial process, not distributors or consumers – to enable them to use the substances safely, without putting their workers, consumers or the environment at risk.

Through a process referred to as evaluation, the EU and its Member States in association with the chemicals agency are accountable for checking some of the registration dossiers for completeness, or assessing whether the testing on animals proposed by the company is acceptable. If a company applies for authorisation, the application will be checked by the authorities which may lead to authorisation of a substance (if it is of ‘very high concern’), restrictions being placed upon its use or no subsequent regulatory action. Member States are in charge of enforcing the REACH legislation in their own country. In the UK the HSE (Health and Safety Executive) is providing the UK competent authority (CA) for REACH.

Companies will only be permitted to use ‘substances of very high concern,’ (around 1,500 substances) if it has been authorised by the European Commission. Chemicals defined as of very high concern are those that are carcinogens, mutagens, reproductive toxicants (CMR), chemicals that are persistent, bioaccumulative and toxic (PBT) in humans and the environment, very persistent and very bioaccumulative (vPvB) and those of equivalent concern, that have a serious and permanent effect on humans and the environment. Such chemicals will be submitted to use-specific authorisation, prioritising the chemicals and giving the industry a chance to justify their ongoing use.

Authorisation for substances of very high concern, for which it is not possible to establish a safe level of exposure, will only be granted to companies who can demonstrate that the socioeconomic advantages outweigh the risks to human health and the environment of using the chemicals, and if there are no feasible safer alternatives available.⁸ For other high concern substances authorisation will be granted if a company can demonstrate that there is a safe level of exposure, below which no severe adverse effects can be determined and that the risks from using the substance can be “adequately controlled.”⁹ This authorisation will be regularly reviewed and chemicals will have to be tested unless appropriate safety information is already in existence.

REACH will also involved the compiling of a publicly available internet database of chemical properties and other information, which will be more accessible throughout the supply chain. The public will be able to request information about certain hazardous chemicals used in consumer products, although some information will remain confidential.

Concerns About REACH 

• Greenpeace and other NGOs have argued that “adequate control” is based on an acceptable degree of risk and that if a safer alternative can be used there is no need to take that risk. In fact taking it could be highly detrimental to humans and our environment in the long-term. It has already been shown that some chemicals travel long distances, polluting far reaching destinations and their inhabitants and it really is better to be safe than sorry. The precautionary principle better ensures safety. Assuming there is an acceptable level of risk for even the most toxic chemicals, endangers our health and the environment.
   
• There is also the danger that industry will attempt to gain authorisation for very high concern substances, that don’t have a safe threshold, by claiming that they can be “adequately controlled.” Companies may also decide to ignore safer alternatives to very toxic chemicals or suggest that they are not viable economically or technologically.
   
• The World Wildlife Fund (WWF) have noted that the registration will only apply to 30,000 of the 100,000+ chemicals on the market, due to a caveat which stipulates that only substances imported in volumes exceeding one tonne, per year, per producer or importer will have to undergo REACH registration. Only rudimentary information will be required for substances within the 1-10 tonnage band due to inherent loopholes, occurring as a result of the chemical industries’ successful attempts to water down the registration. Producers and the authorities will only have to conduct risk assessments for substances that exceed the 10 tonne specification.
   
• Around 70,000 chemicals are produced or imported in volumes of less than 1 tonne per year and REACH does not enforce safety requirements for these. In addition, the decision on whether to mandate industry to replace endocrine disruptors with safer alternatives in every instance has been delayed.
   
• To ensure that registration dossiers comply with the regulation some of them will be subject to compliance checks by the chemicals agency, but the percentage undergoing such examination has been set as “no lower than 5 per cent for the total received by the agency for each tonnage band.” So, 95 percent of dossiers may go unchecked.
   
• REACH states that, “the chemical need not include consideration of the risks to human health from the following end uses…in cosmetic products within the scope of Directive 76/768/EEC.” In other words authorisation for cosmetic constituents covered by the cosmetics Directive can only be required on the grounds of environmental concerns, not on risks to human health. Ton Van Lierop a European Commission spokesman for industry and enterprise says, “The Cosmetics Directive protects human health against potential risks from chemical substances in cosmetic products. It doesn’t address potential environmental risks. REACH aims to cover this without duplicating the cosmetics directive.” Chemical ingredients used in cosmetic products will have to be registered if they are imported or manufactured in more than one tonne per year per producer or importer, but the chemical safety report will not have to address human health risks and the same applies to the authorisation and restriction procedures. Cosmetic products are exempt from the requirement to provide a safety data sheet on the ingredients in them.

Embedded in REACH legislation are numerous reviews which began in 2007 and continue for the following 11 years, giving the EU and its members states the opportunity to strengthen the legislation. However, it could lead to them watering down the current safety requirements. Dr Ninja Reineke of WWF’s Toxics Programme says “REACH will make a difference only in the long term, because it will take three years until we get more information on the higher volume chemicals and some of them may be used in cosmetics. So, for the consumer REACH will not change things overnight. It will take a couple of years until all this information which is generated from the producer will be passed downstream and for the suppliers to set up a mechanism to use this information in the respective places.”

^{1] Rifkin J, A Precautionary Tale, The Guardian, Wednesday 12 May, 2004.
2] A Special Interest Case Study: The Chemical Industry, The Bush Administration and European Efforts to Regulate Chemicals, prepared for Rep. Henry A. Waxman, United States House of Representatives Committee on Government Reform – Minority Staff Special Investigations Division, April 1, 2004.
3] REACH in Brief, European Commission, Enterprise and Industry Directorate General, Environment Directorate General, February 2007.
4] REACH in Brief, European Commission, Enterprise and Industry Directorate General, Environment Directorate General, February 2007.
5] REACH, A Summary Guide, DEFRA (Department for the Environment, Food and Rural Affairs), updated August 2007.
6] Allanou, R, Hansen BG, Van der Bilt Y, Public Availability of Data on EU High Production Volume Chemicals, 1999, European Chemicals Bureau: Ispra, Italy.
7] Commission of the European Communities, Commission Staff Working Paper: Impact Assessment Report on Simplification of the “Cosmetics Directive” – Directive 76/768/EEC (COM(2008)49 final), (SEC(2008)118), February 5 2008, Brussels.
8] Regulation (EC) No 1907/2006 of the European Parliament And of the Council of 18 December 2006 concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH), Official Journal of the European Union, Article 60(4), 30 December 2006.
9] Regulation (EC) No 1907/2006 of the European Parliament And of the Council of 18 December 2006 concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH), Official Journal of the European Union, Article 60(2), 30 December 2006.}