REACH Deadline Draws Near
Yesterday was a record day at the new European Chemicals Agency (ECHA) in Helsinki Finland. Chemical manufacturers and importers are in a panic to get data submitted. With less than two weeks left before the pre-registration deadline 1 December, ECHA has announced that the IT infrastructure has been enhanced, and an emergency back-up plan is in place in case the last-minute rush overwhelms the systems. What is all the excitement about?
The end of chemical use as we know it is at hand. Any company that fails to register their chemical(s) with the ECHA by 1 December, will find that their products are illegal on the European market. Will this law eliminate chemical risks? And how will the slumping world economy react?The REACH law, which stands for Registration, Evaluation and Authorization of CHemicals, was adopted by European Parliament at the end of 2006. At that time, it was projected that about 400,000 registrations would cover the chemicals market. As of this week, the actual number of pre-registrations is over 1.3 million!
No Data, No Market
Pre-registration, Registration: what is it all about? The REACH law requires that every chemical used in quantities over one ton must be proven to be safe for human health and the environment by the chemical companies that profit from that chemical. If a chemical has risks, the industry must prove that the benefits to society outweigh the risks, which must also be carefully controlled. In short: no data, no market.
Obviously, it will take a lot of scientists reading a LOT of reports before every single chemical can be approved. So the law requires pre-registration. All a company must do before 1 December is notify the agency that they want to keep selling their chemicals in the European market. All companies filing this pre-registration will then be put on a schedule for the full registration. Before 2010, all chemicals suspected of having carcinogenic, mutagenic or reproductive toxicity will have to be proven safe, as will chemicals used in over 1000 tons, or chemicals over 100 tons if thought to be dangerous for the environment. Chemicals with lesser risks must be reviewed by 2013 and 2018 deadlines.
The EU leads the world in chemical regulation with this new concept. Based in the Precautionary Principle, this marks the first time governments will enforce the assumption that a chemical is dangerous until it is proven safe. Using the Polluter Pays Principle, the law places the burden on industry to provide the studies and proofs required. In the worst case, if a chemical is risky, but the benefits to society outweigh the risks, the chemical will be allowed only within the rules set out by the Authorization to use the chemical. This could mean, for example, it would be illegal to use a chemical in a normal laptop computer but legal to use in a computer designed for a space station or a medical application.
A law of this scope will certainly have economic impacts. In the first place, most companies have had a year 2-K type of rush to upgrade computer software because the demands of this new law require substantially more tracking of chemical volumes and flows than previously done. The manpower required to review the data, share information with competitors (which is required to ensure that animal testing is kept to a minimum) and organize the data for reporting and submittal is significant. Proponents argue that the investment in compliance will be more than offset by reductions in the costs of chemical risks in terms of environmental degradation and health costs.
The true economic cost may not be clear for years to come though. The open question is: will substitute chemicals with lower risks rise up to replace the "nasty chemicals" or will products you rely on today disappear without replacement? Will the economy get a boost from all the new development which will be triggered by a project of this magnitude? And finally: how will the Chemicals Agency balance the risks against the societal benefits?
Even the people behind the development of REACH admit now that the complexity is much greater than anyone anticipated. Will REACH ultimately be the most far-sighted legislation of our era, creating a green edge that will put European industry into a position of world leadership? Or is an economic disaster for European Industry on the horizon? Stay tuned.