Environment & Energy Report

2019 Outlook: More Scrutiny in Chemical Regulation in European Union

Dec. 27, 2018, 8:00 AM

Chemicals companies will face greater scrutiny in 2019 of the information they provide the European Chemicals Agency, under the European Union’s overarching chemicals law.

The European Commission, the EU’s executive arm, is expected to issue a draft law early in the year that would require companies to update the registration dossiers under REACH (Regulation No. 1907/2006 on the registration, evaluation, and authorization of chemicals), which they have already submitted to ECHA.

REACH includes a general obligation for companies to update their registration dossiers as new substance information becomes available. To trade legally on the EU market, companies must register the chemicals they produce or import in volumes above 1 metric ton annually.

But implementing REACH has been dogged by concerns that the information provided in registration dossiers is insufficient for safe handling of substances, and by allegations that companies are failing to keep their dossiers up to date.

In 2019, ECHA will “move strongly and forcefully forward” with recommendations in the commission’s review, especially on compliance with REACH’s chemical safety information provisions, Bjorn Hansen, ECHA executive director, told Bloomberg Environment. “We want the organization as a whole to focus more on compliance.”

Checks and Evaluation

Although the last REACH registration deadline passed in 2018 and all in-scope chemicals traded in the EU should now be registered, companies shouldn’t expect less regulatory scrutiny or fewer requests for new or updated information about their substances.

“The ’R’ in REACH will still be active: Updates are needed to adjust dossiers according to current knowledge and guidelines,” said Volker Soballa, head of product stewardship at chemical company Evonik Industries AG.

Companies also will have to come to grips with new provisions on nanomaterials in 2019.

Substance evaluation under REACH is the process in which compounds with suspected hazards are assessed, often involving binding requests to registrants to provide new data. If substances are shown to be hazardous, they could be nominated for a range of regulatory measures, potentially including a ban within the EU.

31 on the Menu

During 2019, evaluations either will continue or start for 31 substances with suspected hazards. Evaluations are shared among authorities in EU countries.

On nanomaterials, the commission in December adopted amendments to REACH that set out more clearly the specific data that should be provided in registration dossiers for the nanoforms of substances. Previously, REACH didn’t distinguish between the nanoforms and standard forms of substances.

The new nanomaterial requirements will apply from Jan. 1, 2020, leaving companies all of 2019 to prepare.

There could be problems implementing the nanomaterials requirement related to the analytical methods used to identify them and lack of specialist laboratories, Erwin Annys, director of REACH for the European Chemical Industry Council, told Bloomberg Environment.

‘Constructive Exchange’

For some companies, ongoing REACH compliance means managing hundreds of registration dossiers.

At BASF SE that number is about 1,800 and each dossier is regarded as a living document that requires constant review, according to BASF spokesman Florian Tholey.

Germany’s Lanxess has filed about 1,000 registration dossiers and REACH “is still a challenge for us,” spokeswoman Daniela Eltrop told Bloomberg Environment.

Updating should be based on “constructive exchange and specific dossier compliance checks,” as “generalized criticism” from authorities about the quality of REACH dossiers is counterproductive, Eltrop said.

“A dialogue between industry and ECHA is needed to reach a common understanding on the expected level of quality in dossiers,” said Eveline Kooiman, spokeswoman for Dow Europe.

Exxon Mobil Corp. in 2019 “will continue to fully comply with the requirements of the REACH regulation,” spokeswoman Ann Wurman told Bloomberg Environment.

Smoother Implementation

Following the 2018 registration deadline—which marked 10 years of REACH—ECHA will “identify the lessons learned” so it can make “quicker decisions” with authorization, restrictions, and enforcement, ECHA’s Hansen said.

Under REACH, substances can be banned from use in the EU, though companies can apply for specific continued-use authorizations. Restrictions are specific limitations on applications of substances, for example banning them from certain products.

ECHA and EU countries will look at “key decision points” in these processes to see how they could be streamlined, Hansen said.

For example, when applying for an authorization to use an otherwise banned substances, REACH requires companies to analyze possible substitutes to see if there are other alternatives. It could be clarified how extensive this evaluation of substitutes needs to be, Hansen said.

Pushing to switch some substances because of their hazards “may lead to an increase of regrettable substitutions,” meaning substituting hazardous substances with equally or more hazardous alternatives, Dow Europe’s Kooiman said.

In 2019, ECHA also will seek to identify process improvements that would lead to a reduction in the number of court cases challenging its decisions, Hansen said.

Ready for Brexit

During 2019, REACH must adjust to life without one of the EU’s main chemical industry powers: the U.K., which will leave the bloc March 29.

Depending on the terms of Brexit, the registrations that U.K. companies file may no longer be valid, and companies would have to reregister through intermediaries or agents based in the remaining EU countries.

The U.K. authorities also will no longer take part in REACH processes, such as evaluating suspected hazardous substances or assessing possible substance restrictions. British staff working for ECHA also could find that their rights to work in the EU are curtailed.

“The U.K. is a very active member state and we will miss their capacity,” Hansen said.

ECHA has been “preparing intensely” for Brexit, however, and implementing REACH for companies based in EU countries other than the U.K. will continue uninterrupted, he said.

Brexit could leave companies in Europe facing two parallel regimes—REACH and a similar but separate system in the U.K.

There should be “continued alignment” between the systems, for example to “avoid duplication of efforts on substance registrations,” BASF’s Tholey said.

To contact the reporter on this story: Stephen Gardner in Brussels at correspondents@bloomberglaw.com

To contact the editors responsible for this story: Gregory Henderson at ghenderson@bloombergenvironment.com; Steven Gibb at sgibb@bloombergenvironment.com; Jean Fogarty at jfogarty@bloombergenvironment.com

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