Environmental Alert
REACH: Preparing for the European Union’s Fast-Approaching Chemical Regulatory RegimeBy Douglas Green and Judith George The European Union (EU) is moving closer to enacting a regulation that will establish a stringent framework for reviewing and approving existing and new chemical substances manufactured and used in Europe. The regulatory framework is referred to as REACH, short for Registration, Evaluation, and Authorization of Chemicals. On November 17, 2005, the European Parliament adopted its first reading of the draft REACH regulation. The Council of the European Union reached a political agreement on the draft regulation on December 13, 2005, which the Council is expected to formally adopt in May 2006, paving the way for the European Parliament’s second reading and final enactment. We anticipate that REACH will enter into force in early 2007. Although the main framework has effectively been determined at this time, opportunities continue to be available to influence the details of the regulatory regime. Manufacturers, Importers Will Bear BurdenREACH places the burden on manufacturers and importers of chemical substances and substances used in preparations and articles in quantities greater than 1 metric ton per year to prove that the substances are “safe” for stated uses. This is accomplished through a three-tiered regulatory framework: (1) registration of chemicals with the new European Chemicals Agency; (2) evaluation of chemicals to determine impacts on human health and the environment; and (3) enforcement of measures requiring prior authorization for, or restrictions on the use of particular chemical substances. While the scope of the draft regulation is broad, a number of exemptions are available, including exemptions for certain naturally occurring substances and elemental substances, where the properties of these substances are well known. Polymers, a group of chemicals that includes plastics, will be exempt for now. However, monomers – the basic building blocks of an individual polymer – must be registered and evaluated. Global Impact on Chemical TradeWithout question, REACH will have far-reaching global implications, especially on chemical trade between the United States and the EU. The new regime will have significant impacts on US companies that manufacture chemicals in the EU and/or export chemicals to the EU. In addition, REACH’s requirements will also apply to manufacturers or importers of articles, which release substances under normal or reasonably foreseeable conditions of use (e.g., printer cartridges that dispense ink). The draft regulation also applies to articles that merely contain substances above trace concentrations, if, under normal or reasonably foreseeable conditions, including disposal, the substance may be released, resulting in exposure to humans or the environment (e.g., disposal of a sealed container that could break). Begin Planning for REACH Requirements NowThe best approach for US companies is to prepare in advance for REACH by taking steps to understand REACH’s requirements as applicable to specific chemical substances and products, creating a system for complying with REACH’s registration and testing requirements, and developing a strategy for addressing proposals to restrict the uses of certain chemical substances. Additionally, US companies may wish to appoint an exclusive representative to act in the place of importers to ensure an added measure of control, especially with respect to the disclosure of sensitive information. Other concerns that should be addressed include intellectual property issues associated with data sharing, competition/antitrust issues in connection with chemical company consortia, product liability claims, and increased public attention as a consequence of animal testing activities. DLA Piper has created a multidisciplinary REACH Task Force with lawyers in the United Kingdom, Brussels, and the US to assist clients active in the chemical sector in preparing for REACH by addressing individual concerns and developing joint global solutions. The team includes regulatory attorneys who can provide practical advice on compliance and public affairs and lawyers and lobbyists who can influence the further stages of the EU legislative process and the implementation of REACH in the member states.
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