If you’re a discrete manufacturer you may find it difficult to understand how Europe’s REACH chemical regulation impacts your products. No time to decipher the 849 page regulation? You’re in luck. Here’s a quick list to help you understand your product-related risks and obligations stemming from REACH.
Product manufacturers or suppliers, have four key risk areas – and numerous potential obligations and impacts – to consider:
RISK #1: If your product releases a substance and is made, imported or supplied in Europe
If you make, import, or supply (as a retailer) a product in the European Economic Area (EEA) – currently composed of Iceland, Liechtenstein, Norway and the 27 EU member states – and that product releases a substance, then you may have to register that substance for that use. You should first determine if the following four conditions are true:
1.) The substance is intended to be released from the product under normal and foreseeable conditions of use. One example of an intentional release of a substance is the scent emitted by a scented eraser or children’s toy. Notable exceptions include toner cartridges. According to ECHA guidance, a toner cartridge is not an article releasing a substance, but an article containing a substance. This is an important distinction since it follows that the manufacturer, importer, or retailer may face obligations of a substance maker in addition to those of an article maker.
2.) The substance is not excluded from REACH or exempt from registration
3.) The substance will be imported into the EEA in quantities over 1 metric ton per year per producer, or importer, per legal entity (this includes the total amount of the substance in the product, not just the released portion. It also includes amounts aggregated across all articles of this type per legal entity)
4.) The substance has not already been registered for that use in articles by another company.
Potential Obligation: Registration (REACH, Article 7(1))
If all of the above are true then you may be required to register the substance – in other words, submit a technical dossier to ECHA with information on the properties of a substance and, if required, a chemical safety report documenting the chemical safety assessment for this substance.
RISK #2: If your product contains an SVHC and is made, imported, or supplied in Europe
If you make, import, or supply (as a retailer) a product into the EEA, and it contains an SVHC, you may have an additional set of risks and obligations under REACH. (See the appendix at the end of this paper for the current list of SVHC.)
Potential Obligation: Communication (REACH, Article 33)
If your product contains an SVHC then you must provide sufficient information to allow safe use and end of life disposal of the article, and including – at minimum – the name of the SVHC in question. This information must be provided to industrial or professional users and distributers “automatically.” If requests come from consumers, then information must be provided within 45 days of the request, free of charge.
Chemical Watch has reported at least one instance of a company failing to fulfill REACH Article 33 obligations. In December 2009, they reported: “The Swedish Society for Nature Conservation (SSNC)…has urged the State Prosecution Service to prosecute two companies for allegedly failing to respond to information requests in relation to Article 33. In September the SSNC tested plastic shoes bought in a number of countries and found that two shoes bought in Sweden contained the phthalates DEHP and DBP, which are on the REACH Candidate List and thus SVHCs.”
The obligation to communicate applies regardless of the tonnage shipped (i.e. even if quantities are less than 1 metric ton per year) and begins for supplied articles as soon as the SVHC appears on the candidate list for authorization. The date the article is supplied, or placed on the market is key, not the date it was produced or imported.
Potential Obligation: Notification (REACH, Article 7(2…))
If your product contains an SVHC then you may have to notify ECHA – i.e. provide contact information, the registration number of the substance if previously registered, the identity and classification of the substance, a brief description of the uses of the substance in the article, and the tonnage band of the substance.
Notification is required if:
1.) The SVHC will be imported into the EU market in quantities over 1 metric ton per year per producer or importer/legal entity
2.) Exposure to humans or the environment can’t be excluded during normal use throughout the life of the product, including disposal. Normal use could include “anticipated” use even if not “intended” unless explicitly advised against by the manufacturer.
3.) The substance has not already been registered for that use in articles by another company.
4.) The articles have been produced or imported after the SVHC was included in the candidate list (i.e. were not exclusively produced before it appeared on the list).
Note that none of the conditions above apply to the obligation to communicate – they’re only related to notification. Also, whereas the obligation to communicate begins as soon as an SVHC appears on the candidate list, article makers have an additional 6 months to notify, if notification applies. Notification starts from June 1, 2011.
Potential Obligation: Authorization and restriction
Authorization is the mechanism within REACH for identifying and restricting the use of SVHC. Over time, SVHC on the candidate list will become “subject to authorization” and listed in Annex XIV along with sunset dates. Manufacturers may seek authorizations, but any authorization will be company-specific, use-specific and time-limited. By design, authorization will be expensive for manufacturers and only a temporary fix. One of the ultimate goals of REACH is to remove SVHC from the market.
Even if the articles you produce aren’t directly imported into Europe, you may face additional, indirect obligations arising from supply chain ripple effects – from both your customers and your suppliers.
RISK #3: If your customers import, or make products in Europe
Just because you don’t import your product into EU does not mean that REACH will not impact you. Do you sell to a distributor that imports to Europe? Does your product end up in another product that is imported into the EU? If yes, then the burden of registration and SVHC management and reporting will likely get pushed up the supply chain to you.
Potential obligation: Satisfying the REACH-related requirements of your customer
This can be a confusing area, especially for suppliers who don’t sell directly to Europe and are new to REACH. REACH may place direct legal obligations on your customer, but not on you. The demands that your customer places on you may be related to REACH. But they ultimately have more to do with the strategy of your customer and the business relationship between you and your customer, rather than with any specific obligations spelled out by the REACH regulation. For example, your customer may decide to impose requirements that are stricter than REACH – say request information on a forward-looking list of SVHC that is longer than the official list of SVHC.
Alain Digeon, Senior Vice President of Environmental Projects at Schneider Electric described the supply chain challenge in Supply and Demand Chain Executive, “REACH requires a lot of data, new data, and changing data. It needs to be exchanged between customers and suppliers, and some of these suppliers have never heard about REACH and could care less about it.”
RISK #4: If your suppliers (or their customers) import or make products in Europe
Because of REACH and the sheer size and influence of the EU market, certain chemicals, parts, and materials will become costlier and harder to procure. They may even disappear from the market as suppliers faced with additional costs and restrictions decide to shift their business elsewhere. The European Commission has estimated that 1-2% of the roughly 30,000 substances in production will be withdrawn from the market due to REACH.
Potential impact: Supply chain disruptions and higher costs
Now more than ever, manufacturers must identify and manage the supply chain risks arising from the substances in the articles they produce. Targeted substances like the REACH SVHC, those on ChemSec’s “Substitute It Now!” (SIN) list and others expose you to risks of increasing costs, obsolescence issues and supply chain disruptions.
For discrete manufacturers, REACH is about more than saving the environment. It’s about avoiding business disruptions caused by high-risk substances in your products and supply chain. As Andy Page, Engineering and Technology executive at Rolls-Royce puts it, “This is predominately a business risk issue.”
Other considerations and risks
In addition to the above, you may face more requirements under REACH that are not related to “the requirements for substances in articles” – as ECHA describes them. For example, manufacturers who are located in the EU must ensure the processes and chemicals used in their European facilities comply with REACH. Finally, if you manufacture substances or preparations in addition to manufacturing articles, you will face an additional set of obligations. These topics are outside the scope of this guide.
The rest of this series will provide practical steps that your organization should take to meet the challenges of REACH, along with other useful information.
Note: This guide (and this blog) is informative only and has no legal authority. You should refer to the REACH regulation itself for a full statement of the legal requirements, and in the case of any doubt seek legal advice.
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