Impact of REACH on the Plastics and Packaging Supply Chains Sean Milmo Published by Pira International Ltd Cleeve Road, Leatherhead Surrey kt22 7ru UK T +44 (0) 1372 802080 F +44 (0) 1372 802079 E [email protected] W www.piranet.com The facts set out in this publication Pira International Ltd acknowledges product, service and company names referred to are obtained from sources which we in this report, many of which are trade names, service marks, trademarks or registered believe to be reliable. However, we trademarks. accept no legal liability of any kind for the publication contents, nor any information contained therein nor conclusions drawn by any party from it. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise without the prior permission of the Copyright owner. ISBN 1 85802 565 6 © Copyright Pira International Ltd 2006 Head of publications and events Philip Swinden [email protected] Publisher Rav Lally [email protected] Head of editorial Adam Page [email protected] Global editor Nick Waite [email protected] Head of US publishing Charles E. Spear, Jr. [email protected] Assistant editor Claire Jones [email protected] Customer services manager Denise Davidson [email protected] T +44 (0)1372 802080 Typeset in the UK by Jeff Porter, Deeping St James, Peterborough, Lincs [email protected] Contents List of tables v The secretariat and executive director 27 List of figures vi The agency’s committees 28 1 Board of Appeal 29 4 Introduction to REACH 1 European Commission’s legislative Registration 31 proposals for REACH 2 Basic registration requirements 32 Amendments to REACH by the European Pre-registration 32 Parliament and Council of Ministers 6 Steps for assessing data The European Chemicals Agency 8 requirements 33 Registration 9 Information needed for a standard Data sharing 11 technical dossier 34 Evaluation and authorisation 12 Hazard data requirements 34 Downstream users of chemicals 12 Full or partial exemptions from REACH 35 2 Polymers 36 Preparations and substances in articles 37 Intermediates 38 Drivers behind REACH 15 Prioritisation and registration deadlines 39 International and EU political trends 15 Substances of 1 tonne or more 39 The influence of NGOs 16 Substances of 10 tonnes or more 39 Role of EU legislative institutions 17 Substances of 100 tonnes or more 40 Concerns about SMEs 19 Substances of 1,000 tonnes or more 41 Main issues affecting the finalisation and Chemical safety assessments and chemical implementation of REACH 20 safety reports (CSRs) 42 Substitution 20 Chemical safety assessments 42 Confidentiality 21 Exposure assessments 43 Duty of Care 21 3 Chemical safety report 44 Classification and labelling inventory 45 5 European Chemicals Agency (ECHA) 23 The ECHA’s position within the REACH Data sharing 47 system 23 One Substance, One Registration Specific responsibilities and tasks of the (OSOR) 47 agency 24 Sharing of test data 48 The management structure of the Opting out and issues of confidentiality 49 agency 26 Confidentiality 49 Management board 26 Sharing of information costs 51 Page iii © Copyright Pira International Ltd 2006 Impact of REACH on the Plastics and Packaging Supply Chains Contents 6 Chemical safety report 68 8 Evaluation and authorisation 53 Evaluation procedure 53 Imports and trade 71 Dossier evaluations 53 REACH regulations on imports 71 Substance evaluations 54 Substances in articles and Authorisation process 55 preparations 71 Criteria for candidate list 55 REACH as a possible barrier to trade 73 9 Comitology procedure 55 Prioritisation 56 Authorisation applications and decisions 57 Authorisation reviews 57 Outlook 75 Controls and restrictions 58 Costs of REACH 75 Substitution 59 Implementation and enforcement of Socio-economic analysis (SEA) 60 REACH 76 7 Strategic partnerships 77 Enforcement 78 Effects on competitiveness and innovation 79 Downstream users 63 Innovation 79 Changes in the scope of safety data sheets Health, safety and environmental (SDSs) 64 benefits 80 Uses and preparations 66 REACH as a global pace-setter in health Chemical safety assessments by and safety 80 downstream users 67 Page iv © Copyright Pira International Ltd 2006 List of tables 2.1 Availability of various toxicity data 5.1 Information held by the European on high production volume chemicals Chemicals Agency that will be (HPVCs) with annual output above considered open, confidential or the 1,000 tonnes in the European Union, disclosure of which will be left to the according to substance type 16 agency’s discretion 50 2.2 REACH legislation chronology 18 6.1 Health and safety risk assessment of 3.1 Responsibilities of different UV curing of printing inks 59 entities within the European 6.2 Environmental assessment 60 Chemicals Agency 26 7.1 Information sources for downstream 4.1 Pre-registration information 33 users on substances in articles 64 4.2 Registration deadlines 34 7.2 Environmental impact assessment of 4.3 Number and production volume UV and conventional printing 67 range of selected specialty 7.3 Risk assessment matrix 69 chemicals 40 Page v © Copyright Pira International Ltd 2006 List of figures 1.1 REACH timeline 2001–06 3 6.1 Steps to authorisations 56 1.2 REACH timeline 2006–18 6 7.1 REACH and the supply chain 63 2.1 Number of enterprises and sales 7.2 Sectoral breakdown of EU chemical by employment size-class in EU industry, 2004 65 chemical industry 19 8.1 Breakdown of world chemical 2.2 REACH preparations checklist 20 sales 73 4.1 REACH recycling timeline 32 9.1 REACH regulation timetable 76 Page vi © Copyright Pira International Ltd 2006 1 Introduction to REACH Politicians, industrialists, environmentalists and trade unionists in the EU have been virtually unanimous in affirming the need for a single piece of new EU legislation to govern chemicals. But there has been a lot of disagreement – particularly between industry and environmentalists – about what type of single regulatory system is needed. The European Commission, the EU’s executive, has drawn up a scheme called REACH for the Registration, Evaluation and Authorisation of CHemicals. But it has turned out to be one of the most controversial items of industrial legislation ever put forward by the EU. Because of the size of the EU’s market, the introduction of the REACH project will affect the marketing of pigments and other chemicals throughout the world. Prior to REACH, the use of chemicals in the EU has been governed by 40 different directives or laws incorporated into the statute books of all the EU’s 25 member states. The Commission, member states, non-governmental organisations (NGOs), environmental groups and other bodies were all agreed that a simplified form of regulatory control was required. However there have been sharp differences over what types of controls over chemicals would be required. Environmentalists called for tighter restrictions than in the existing rules. They in particular urged more application of the precautionary principle under which action would be taken against chemicals when there are reasonable doubts about their safety despite the lack of scientific proof. The environment campaigners won a great deal of support among the general public in Europe who had become increasingly concerned about the safety of chemicals after a series of industrial accidents, health scares and studies showing a rising level of pollution. The chemical industry and its customer sectors, on the other hand, warned about the dangers of precipitate and unjustified measures. The demand for new legislation was fuelled by the obvious failure of current EU regulations to provide assurances on the safety of chemicals already on the market. A directive from 1976 enables the EU to restrict the marketing and use of certain dangerous substances and preparations. Restrictions have been imposed on around 100 substances, including their use in finished articles. In addition, controls have been placed on the marketing to the general public of around 900 substances classified as carcinogenic, mutagenic or toxic to reproduction (CMR). Under a law introduced in 1981, new substances, even those for research purposes, with volumes as low as 10kg, had to be tested and assessed for possible risks to human health and the environment. But there was no provision for testing nearly 100,000 existing chemicals. Public authorities were later given responsibility to undertake risk assessments of chemicals considered potentially dangerous, with the possibility of imposing restrictions on their use. By 2004 around 3,000 new chemicals had been authorised under the 1981 rules. Of existing, possibly harmful, high-volume chemicals, only 141 had been identified for risk assessment by authorities within individual member states, with a mere 27 completing the process. As a result there has been a general lack of publicly available knowledge about the properties and uses of over 99% of substances on the market. Page 1 © Copyright Pira International Ltd 2006 Impact of REACH on the Plastics and Packaging Supply Chains Introduction to REACH Under current legislation, only manufacturers and importers of substances have been required, if necessary, to provide safety and other data on their products. Downstream industrial users and formulators have not been obliged to do the same. So information on the uses of substances has been hard to obtain, with a scarcity of data about exposure to chemicals from downstream applications. Generally, industry has to provide test data only when a substance has been proved to pose a serious risk. But without test results, the authorities have claimed that it has been almost impossible to supply such proof. European In February 2001 the European Commission issued a White Paper on a future chemical Commission’s policy for the EU. It was welcomed by environment groups, although some thought its legislative proposals proposals were not tough enough. But it was strongly criticised by the chemical industry for REACH and many of its customer sectors. It also had a mixed response from member states. Scandinavian countries and those with relatively small chemical industries tended to be the most supportive. Countries like Germany, the UK and France with large chemical sectors were inclined to be the most sceptical. Many politicians were nervous about the impact of the new policy on a chemical industry which is the third largest manufacturing sector in Europe and employs 1.7 million directly while another 3 million people are dependent on it for their jobs. The Commission claimed that the overriding goal of the policy was sustainable development, which depended on a number of objectives in order to be achieved in the chemical industry. These were: Protection of human health and the environment; Maintenance and enhancement of the competitiveness of the EU chemical industry; Prevention of fragmentation of the EU’s internal market; Increased transparency by giving consumers access to information on chemicals; Integration with international efforts on safety of chemicals; Promotion of non-animal testing; Conformity with the EU’s international obligations within the World Trade Organisation (WTO). A key proposal of the Commission was that manufacturers and importers would have to register all substances which they produce or supply in total annual amount of over one tonne. These were estimated to total around 30,000 companies. The registration dossier on each substance would include data on physicochemical, toxicological and ecotoxicological properties. The information could be equivalent to that already required for new chemicals. The Commission argued that it would fill the gap in knowledge about the intrinsic properties of existing substances. Also, by having a volume threshold of one tonne, many chemicals used in research and development would be exempted from the scheme. All the registered information on substances with an annual production of more than 100 tonnes and those of lower volumes with worries about their safety would be evaluated by authorities with a view to undertaking further testing programmes on the effects of Page 2 © Copyright Pira International Ltd 2006 1 Impact of REACH on the Plastics and Packaging Supply Chains Introduction to REACH FIGURE 1.1 REACH timeline 2001–06 (cid:18)(cid:15)(cid:1)(cid:49)(cid:83)(cid:80)(cid:81)(cid:80)(cid:84)(cid:66)(cid:77)(cid:1)(cid:71)(cid:83)(cid:80)(cid:78)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:36)(cid:80)(cid:78)(cid:78)(cid:74)(cid:84)(cid:84)(cid:74)(cid:80)(cid:79) (cid:18)(cid:15)(cid:1)(cid:34)(cid:79)(cid:1)(cid:38)(cid:68)(cid:80)(cid:79)(cid:80)(cid:78)(cid:74)(cid:68)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1) (cid:52)(cid:80)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:36)(cid:80)(cid:78)(cid:78)(cid:74)(cid:85)(cid:85)(cid:70)(cid:70)(cid:1) 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(cid:68)(cid:80)(cid:79)(cid:68)(cid:70)(cid:83)(cid:79)(cid:70)(cid:69)(cid:1)(cid:74)(cid:79)(cid:1)(cid:66)(cid:68)(cid:68)(cid:80)(cid:83)(cid:69)(cid:66)(cid:79)(cid:68)(cid:70) (cid:85)(cid:73)(cid:70)(cid:1)(cid:75)(cid:80)(cid:74)(cid:79)(cid:85)(cid:1)(cid:85)(cid:70)(cid:89)(cid:85) (cid:88)(cid:74)(cid:85)(cid:73)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:75)(cid:80)(cid:74)(cid:79)(cid:85)(cid:1)(cid:85)(cid:70)(cid:89)(cid:85) (cid:19)(cid:23)(cid:15)(cid:1)(cid:34)(cid:68)(cid:85)(cid:1)(cid:74)(cid:84)(cid:1)(cid:66)(cid:69)(cid:80)(cid:81)(cid:85)(cid:70)(cid:69) (cid:19)(cid:23)(cid:15)(cid:1)(cid:34)(cid:68)(cid:85)(cid:1)(cid:74)(cid:84)(cid:1)(cid:79)(cid:80)(cid:85)(cid:1)(cid:66)(cid:69)(cid:80)(cid:81)(cid:85)(cid:70)(cid:69) Source: Pira International Ltd Page 3 © Copyright Pira International Ltd 2006 Impact of REACH on the Plastics and Packaging Supply Chains Introduction to REACH long-term exposure to them. An estimated 5,000 substances or 15% of the total would have to be evaluated. Authorisation would have to be obtained for substances with certain hazardous properties. These could include chemicals classified as CMR substances or those likely to be identified as CMRs after further testing. They would also include substances categorised as persistent organic pollutants (POPs). Around 1,400 substances or 5% of the total were likely to have to be authorised. Responsibility for generating and assessing data on chemicals, as well as gauging the risks of using them, would be shifted from the authorities to industry. Producers and importers would have to ensure that only chemicals that are safe for their intended uses are placed on the market. Furthermore, downstream users of chemicals, such as formulators, would be responsible for all aspects of the safety of their products. They would have to provide information on the use of and exposure to chemicals so that they could be properly assessed. When uses of chemicals by downstream operators differ from those originally envisaged by manufacturers or importers, the downstream user would be obliged to carry out additional tests. The Commission argued that its proposed REACH scheme would stimulate innovations in the chemical industry as it would encourage producers to develop safer chemicals. It would also increase transparency in the industry and in the use of its products because the public would have the right of access to information about the chemicals to which they are exposed. On the costs of the system, the Commission calculated that tests to meet the basic registration requirements could cost around €85,000 per substance. With substances needing more stringent testing the cost could be as high as €325,000. The total testing costs would be about €2.1 billion over the 11 years during which the whole REACH registration programme would be completed, according to the Commission. During a consultation period extending over two years after the publication of the White Paper, a number of conferences and workshops of stakeholders – the chemical industry, downstream users, NGOs, trade unions and governments of EU member states – took place. There was also an internet consultation which attracted over 6,000 contributions, 42% of which came from companies or trade associations. The consultation showed a broad consensus on the need for a new European chemicals policy, the main objectives of which would be sustainable development and the safe use of chemicals. Stakeholders generally agreed on the necessity of a balance of responsibilities between industry and authorities, on the need for international co- ordination on chemical safety and for improved communications on chemical risks. The main concerns, especially among chemical producers and their downstream customers, were: The economic and social costs of the whole scheme, with the chemical industry in particular expressing doubts about the accuracy of the Commission’s cost estimates. Page 4 © Copyright Pira International Ltd 2006