If you want an example of exactly how Brussels should not approach regulation, look no further than its chemical regime – REACH. The aims of REACH, which stands for Registration, Evaluation, Authorisation and restriction of Chemicals, are laudable but the approach is complex and costly. Take the process of applying for authorisation to use substances (either alone, in formulations or in products themselves) that are to be subject to widespread bans.
So far, 14 substances will be banned in 2014 and 2015. A dozen or so more have recently been recommended for future bans. Authorisation is available because, for certain applications, there may be no known alternative to a substance. It may used in a suitably controlled way or the substance may be used in the production process but not detectable in the final product. It may be safety critical.
To gain authorisation companies must pay a €50,000 application fee. On top of this, companies must demonstrate publicly that they have considered other alternatives and that the substance is being adequately controlled. Alternatively, they have to demonstrate that the socio-economic benefits outweigh the risks posed by that substance.
The costs of this work risk running into hundreds of thousands of pounds. How can SMEs expect to shoulder this or the complexity of a process in which the guidance runs to hundreds of pages, the data required to support applications is onerous and the technical skills required are beyond most?
“How can SMEs expect to shoulder this or the complexity of a process in which the guidance runs to hundreds of pages, the data required to support applications is onerous and the technical skills required are beyond most?” – Terry Scuoler, chief executive at EEF
If you are granted authorisation, where you sit in the supply chain really matters. For chemical manufacturers perched at the top of the supply chain, authorisation of a substance helpfully flows all the way down the supply chain. But often chemical manufacturers have no intention of applying for authorisation for niche uses. This represents a problem in particular for customers that may not want to tell their chemical supplier how they are using a substance or don’t know who the chemical manufacturer is because they buy from traders. We are working hard in the UK and Europe to get these issues addressed and have set up a free e-alert service to help you stay on top of developments.
But it is essential that you speak to your supply chain. Assess where your REACH risks lie. Ensure they are monitored. Be prepared.