APPENDIX 12
Memorandum from the Confederation of British
Industry
1. The Confederation of British Industry
(CBI)—with a direct company membership employing over four
million and a trade association membership representing over six
million of the workforce—is the premier organisation speaking
for business in the UK. The CBI represents companies operating
in all areas of the chemicals supply chain, including producers,
importers, distributors, downstream users and consumers.
2. We share the aims of the proposed Regulation
in protecting the environment and human health, and point to existing
environmental and health and safety legislation and voluntary
action as having already achieved improvements in this area. We
do, however recognise that more needs to be done, especially in
relation to the effective enforcement of this current regulatory
regime.
3. We recognise that many of the important
details of the proposal require further development and offer
the following comments to focus on measures that will improve
the workability of the proposal for business, Member States competent
authorities and the proposed Agency and secure the sustainable
competitiveness of European industry.
GENERAL COMMENTS
4. We appreciate the significant improvements
that have been made to the proposal since the "2003 internet
consultation" and highlight these in our detailed comments
later in this document. It is essential that these improvements
are maintained during the future negotiations of REACH as business
needs to make its plans from a secure base. However, we believe
that there are still a number of issues relating to the workability
and proportionality of the proposal that need to be addressed
before REACH can be agreed and implemented and we look forward
to working with the UK Government, the European Commission and
other institutions to provide information and assistance.
5. The CBI believes that the most important
general tasks to be addressed now are:
— Risk based approach to prioritise
the targeting of substances for Registration;
— Macro and focused supply chain impact
assessments to reveal challenges and improve workability;
— Securing European competitiveness
generally and in particular related to dealing with articles;
— Addressing authorisation and substitution
in a way that contributes to sustainable development;
— Clarifying the scope and definitions
and minimising duplication and conflicts with other legislation;
and
— Ensuring appropriate confidentiality
and intellectual property rights.
Risk based approach to prioritise the targeting
of substances for registration
— Priority for substances to go through
the REACH process should be based on risks as opposed to hazard.
Resources must be used to ensure that substances of highest concern
are assessed first. Although the phase-in of substances into the
REACH process could be seen as a form of prioritisation, with
tonnage being an indicator for exposure, we feel that this approach
will leave some substances of concern until later in the registration
process, whilst substances which have been shown to be safe for
many years are dealt with first. There is sufficient information
and agreement at European level on enough substances that are
known to pose higher risks for these to be addressed in a practical
way in the first time-frame envisaged under the regulation. Industry
would wish to work with the Commission to gain consensus to identify
these substances that will be given priority in the first phase
of Registration through the REACH process. This initial phase
will give the practical experience and information to allow a
more efficient process for prioritising substances to be addressed
in the future time-frames envisaged. Subsequent decisions about
the management of registered chemicals should also be based on
a holistic view of environment and public health and safety risks.
Macro and focused supply chain impact assessments
to reveal challenges and improve workability
— The impact assessments performed
to date by or on behalf of the Commission have taken a limited
and closed view of the impact on European businesses even though
an extended impact assessment has been produced to accompany the
publication of the REACH proposal. We do not feel that this assessment
adequately reflects the potential effects to downstream users
of the loss of certain substances from the supply chain, the effects
of increased competition from outside the EU, and the increased
costs associated with the implementation of the REACH system.
Chemicals are a global business and a deeper assessment is needed
to examine the impact of REACH on the European economy as a whole.
The REACH proposal envisages a simplistic model for the production
and use of substances that does not exist in reality. The chemicals
supply chain is complex, involving many different actors operating
at many levels within the chain. The ways in which chemical substances
are synthesised, formulated and used are complex, and rarely linear.
More focused impact assessments on particular supply and use chains
should be performed to gain insight into the complexity of such
chains, the cost of unintended consequences on businesses and
could identify where action is needed to improve the workability
of the system.
Securing european competitiveness generally and
in particular related to dealing with articles
— Robust measures must be in place
to ensure that importers are effectively covered by the legislation
not just EU producers. Whilst on the surface the trade implications
associated with the REACH proposal appear to have been adequately
dealt with, with importers of substances facing the same requirements
as those manufacturing them in the EU, we still believe that some
trade issues remain to be addressed. Those importing finished
articles, for example, will not have to use substances that have
been through the REACH process, putting them at a competitive
advantage to those manufacturing the same product within the EU.
Some substance manufacturers and importers may not be able to
afford to or may choose not to register substances at all, or
not for certain uses, and will take them off the market. This
would have a domino effect through the supply chain, again putting
manufacturers at a disadvantage to their non-EU counterparts who
will still be able to obtain the substance from non-EU sources.
The cumulative effect of the REACH proposal, along with other
pressures, will lead manufacturers to move their operations outside
the EU. This would represent a serious drop in EU productivity
and innovation and would result in the export of environmental
and health and safety challenges to countries that are less equipped
to deal with them. The only effective solution is to ensure a
globally harmonised system and the EU should seek to work towards
this. In the long term, tackling this process now is a more effective
use of industry and regulatory resources. It may also help to
prevent legal challenges to the REACH process by the EU's major
trading partners.
Addressing authorisation and substitution in a
way that contributes to sustainable development
— Substitution should be encouraged
in applications where less hazardous and lower risk alternatives
are commercially available for the appropriate use. To deliver
sustainability, decisions on substitution must take a holistic
view of all relative hazards and risks on a case-by-case evaluation,
engaging downstream users as well as producers. Business has been
involved in Human and Environmental Risk Assessment initiatives
that can be used as a basis for more holistic risk assessments.
Availability and performance criteria must be adequately considered
alongside environment and health issues. The justification for
requiring and accepting substitutes should be transparent so that
consistent principles can be developed for future decisions.
Clarifying the scope and definitions and minimising
duplication and conflicts with other legislation
— By seeking to make the scope of REACH
all embracing to cover all manufacture, importation, placing on
the market and downstream use of all substances and preparations
and to cover articles there are unnecessary duplications and conflicts
of REACH with other regimes such as those for worker protection
and waste minimisation. These make the proposal unnecessarily
complicated unworkable in some aspects and undermine other policy
objectives for example for recycling and sustainable development.
We would like to see these overlaps investigated further and resolved.
One solution is to confine REACH to substances and preparations
placed on the market (with a suitably robust definition of placing
on the market). Another option is to provide exemptions eg for
waste, on the basis that there is extensive legislation already
addressing the main environmental and health issues.
— In the event that substances may
be lost from the market this will have considerable consequences
for compliance with manufacturing processes, product standards
and stock holdings for components, some of which are critical
and mandated under European product legislation. Deeper examination
of focused supply chains will assist in understanding the implications
and being able to address the challenges.
Ensuring appropriate confidentiality and intellectual
property rights
— Some of the information required
under the proposed system, especially that in relation to production
tonnages, is extremely commercially sensitive. Competition law
prevents companies from exchanging this information directly.
In order to do so imposes further costs on business requiring
management by a mediator. Further consideration needs to be given
as to how commercially sensitive information is managed and stored
securely. We suggest that the requirements for this type of data
be minimised and that they be held in a separate, secure system
to the data that may be made publicly available. No link should
be shown between company names, CAS numbers, EINECS or ELINCS
numbers and product or trade names as these have commercial and
intellectual property implications. For reasons of personal security
of company staff, further consideration should be given to the
desirability of making publicly available the fact that testing
on vertebrate animals has been carried out in relation to a substance
and registration.
Comments on the Details
Further details required
6. Many of the important details of the
proposal are yet to be developed. These include:
— guidance relating to the incidental
release of substances from articles;
— risk management procedures for downstream
users; and
— criteria for the prioritisation of
substances for evaluation
This lack of detail seriously impedes discussion
of the workability of REACH. We would like to see these additional
details and guidance developed as soon as possible in order to
inform the on-going policy debate on REACH.
Scope
7. We note and support the improvements
made so far for polymers and some intermediates. However the position
for all polymers and intermediates, waste, minerals and ores,
alloys and treated natural fibres should be clarified. A single
provision on scope should appear at the beginning of the regulation.
— If polymers are to be fully exempted
from REACH they should be included in Article 2 (1).
— In a risk based system the position
of intermediates would resolve itself as their exposure potential
would not make them a priority and existing legislation would
provide adequate control.
— Process waste is still subject to
registration, although exempt from authorisation. It is not practical
to characterise and register every constituent of processed waste.
As substances or preparations and identification of the manufacturer
of waste throughout the waste processing chain ( and hence the
person who registers) will also be a problem.
— Substances produced for export only
are controlled under REACH and additionally controlled in the
country where they are being exported. They should be treated
in the same way as intermediates transported.
Definitions
8. The definition of substance, preparation
and article need to take into account materials such as polymers,
alloys and treated natural substances and fibres, whose fit with
the current definitions is unclear.
Articles
9. We appreciate the drivers behind the
proposal that substances in articles be registered if they are
put on the market in quantities exceeding 1 tonne per year, are
classified as dangerous (according to Directive 67/548/EEC) and
they are intended to be released under normal and reasonably foreseeable
conditions and also if this release in not an intended function
of the article. The intention as it is drafted is seeking to satisfy
many objectives
— the competitiveness of European business
versus the global competition in the importation of articles;
— environmental and health concerns
from certain imported articles containing substances.
Specific marketing and use legislation has so
far not successfully addressed this latter issue.
The way the current proposals are drafted means
that the definitions are open to subjective judgement and will
be difficult to enforce. It is virtually impossible that they
will be able to achieve all the above objectives. The CBI believes
that the Commission should reconsider what could and should be
achieved by the REACH proposal on articles, sufficient guidance
to provide interpretation for business to achieve compliance and
for authorities to be able to enforce the obligations. Other instruments
may be much more appropriate to achieve certain of the objectives
and stakeholders should be invited to explore these issues. If
the Commission continues with the present proposal clear examples
are needed about what this regulation is intended to control and
the CBI would like to see criteria developed as to the threshold
releases at which a notification will be required. This will also
be needed in order to set release detection levels for enforcement.
Realistic and robust arrangements for enforcement will have to
be in place for these requirements to achieve their intended objective.
Research and Development
10. The Agency must be notified of substances
to be used for research and development (R&D) and they will
be exempt from registration for five years. The Agency can extend
this exemption for a further five years. The CBI is pleased that
the tonnage restriction for R&D has been removed.
Phase in substances
11. The use of the term "phase in substances"
has added confusion to the registration priorities. It should
be removed as it is an expression of a registration timetable
that is currently arbitrary and should, in any case, be justified
on a cost, availability of resources and workability basis.
Registration
12. Substances manufactured or imported
in quantities over 1 tonne per year must be registered with the
central Chemicals Agency. Substances classified as Category 1
or 2 CMRs and those produced in quantities over 1,000 tonnes must
be registered after three years, substances produced at over 100
tonnes after six years, and the remaining 1-100 tonnes after 11
years. The Commission have stated that this phase-in of the registration
process according to tonnage represents a prioritisation within
the system as production tonnage is seen to reflect exposure potential.
The CBI would like to see more emphasis on prioritisation based
on risk within the system.
13. Prioritisation may be more manageable
if a pre-registration phase is introduced for all substances at
the same time so that the scale of the task ahead can be defined
and managed. Issues of commercial sensitivity and confidentiality
will have to be adequately resolved, and pre-registration, within
an agreed time period may provide a simple option to identify
what companies have an interest in what substances by providing
information such as:
— Company name (or representative);
— Chemical name / CAS Number;
— Animal tests available; and
— Wish to join consortia Y/N.
Those companies not wishing to be revealed to
other members of a consortia would be expected to make available
results of animal test to the consortia to ensure that duplication
of animal testing is limited. Alternatively they could participate
"anonymously" by using an agent to represent their position.
Registration consortia
14. The REACH proposal allows for the formation
of consortia for the purposes of registration, with one manufacturer
or importer acting as the lead party and submitting the substance
information for registration. The CBI welcomes the flexibility
within the registration process to allow for the formation of
registration consortia. The way in which a consortium is structured
will influence the cost of putting that substance through the
REACH process and this cost will be passed to the downstream user,
who, as it currently stands, has no direct influence in the consortium.
We suggest that the workings of the consortia be considered further,
including a more defined role for downstream users. Whilst consortia
should be promoted as a means of reducing costs and minimising
data duplication, the decision to join them should remain voluntary
in order to preserve competitiveness, flexibility and to protect
intellectual property rights where there are business needs to
do so.
One registration per substance
15. There is a proposition for one registration
per substance, essentially leading to the need for the formation
of consortia for the majority of substances where there is one
identification for the substance and one registration. The benefits
of this approach are the minimisation of duplicate animal testing,
better substance identification and characterisation so reducing
burden on the Agency and Member States in limiting the number
of registrations that require completion checks and dossier evaluations.
Ideally the creation of a single data package would improve workability,
decision-making and increased transparency. Forcing industry to
join consortia shifts additional administrative burdens onto industry,
and raises problems about the sharing of commercially sensitive
information such as production tonnages. The proposal has many
attractions provided the competition and confidentiality aspects
can be managed and the CBI would be happy to discuss the practicalities
further. Appropriate incentives for companies to work together
in consortia would have to be provided. However, there must be
flexibility in the system to allow companies to operate outside
consortia and to register separately when there are real business
reasons for doing so. An arrangement of "One registration
per substance" would substantially alter the architecture
of much of the Regulation and would affect many details, solving
some of the current problems but introducing others. The CBI will
continue to input to the developments and analysis.
Information and testing requirements
16. The REACH proposal sets out information
and testing requirements for registration depending on the annual
production tonnage of the substance in question. The CBI welcomes
the reduced testing requirements for substances produced in quantities
of less than 10 tonnes. However,
— Requirements should be driven by
the need for information to prepare the risk assessment (and not
only based on tonnage).
— The proposed test programme in Annexes
V-VII is still too excessive and goes beyond the White paper particularly
for mutagenicity and reproductive toxicology.
— The provisions on QSARs are welcome,
but the text only allows their use in the 1-10t band. They should
be applicable to all volumes.
17. Procedures for data sharing and exchange
are set out in the proposal. The CBI welcomes these provisions,
especially in relation to SMEs, who otherwise may not have access
to this information. We are concerned, however, that firms who
have invested in testing will be penalised if they cannot come
to an agreement with other potential registrants over the division
of costs. As written, any company with the registration data can
charge another making use of it at 50% of the cost. If many companies
use the data from the original company then there will be a substantial
profit to the original company. There needs to be further consideration
of this arrangement in terms of market distortions and equity.
Further detailed consideration of "one substance one registration"
and the consortia formation may overcome this.
Confidentiality of information
18. A list of information that will be considered
as confidential is set out in the proposal, including the composition
of preparations, production tonnages, detailed uses and links
between suppliers and users. The identification of confidential
information is very important and a welcome addition to the proposal.
However, there are still many opportunities in REACH for confidential
information on substances to become "public". For example,
the classification and labelling inventory will be publicly available
and it enables a link between manufacturer/importer and the precise
chemical identity of the substance. Also, the Agency will apparently
grant access to information which is not regarded as "non-confidential"
to others who have submitted information on the substance. Hence,
competitors may find out information the original company may
not wish them to know.
Chemical Safety Assessment (CSA) and Report (CSR)
19. A chemical safety assessment must be
conducted and a chemical safety report completed for all substances
produced in quantities over 10 tonnes. Where a substance is identified
as dangerous the CSR must also include an exposure assessment
and risk characterisation. The CBI is pleased that the requirement
to conduct a CSA has been removed for substances produced in quantities
of below 10 tonnes. We would still like to see more streamlining
of the requirements of the CSA and CSR with current environmental
and health and safety regulation. There is a substantial body
of occupational health and safety requirements that still needs
the development of practical guidance for business, integrated
with the developing framework for REACH. There is an urgent need
for this to be supplemented with practical guidance for businesses
to address environmental risks.
Safety Data Sheets (SDS)
20. The REACH proposal requires manufacturers
or importers of substances and preparations to provide downstream
users with a safety data sheet for the purposes of managing their
risk when using the substance. The SDS must be consistent with
the CSA. The CBI is pleased that industry comments during the
internet consultation regarding the use of CSRs in the supply
chain have been taken on board. The use of extended SDSs will
reduce the burden on downstream users compared to dealing with
CSRs.
The Agency
21. The Agency to be set up under the REACH
proposal will be responsible for the registration process and
an associated completeness check, before passing registration
details on to the relevant Member State. We are pleased that a
board of appeal has been included within the structure of the
Agency. The process however is still too complex with many decision-making
bodies involved that may introduce inefficiencies. The Central
Agency must have powers to oversee/manage the entire REACH process
to ensure consistency and timeliness of decision-making whilst
ensuring that those who have to comply and on whom costs will
fall are involved in ongoing consultation.
Downstream Users
22. Downstream users are required to pass
information up the supply chain on the appropriateness of risk
management measures that have been suggested by the supplier.
Downstream users have the right to inform their supplier of a
use and supply the appropriate exposure scenarios for use in the
CSA. The CBI welcomes the removal of the requirement to register
a substances for 90% of its uses, but is concerned that downstream
users could still be cut out of the supply chain if the supplier
chooses not to register the substance for their use for commercial
reasons. A downstream user can also choose to conduct the CSA
themselves for their use. The CBI welcomes the flexibility in
allowing downstream users to conduct their own CSAs and this should
be aligned with current legal requirements with further practical
advice for those aspects of environmental risks that are not currently
covered. The risk assessment requirements for downstream users,
as set out in Annex XI, demand development of exposure scenarios,
which includes estimating exposures and levels and fate of substances
in the environment [Annex I, section 5] This is a challenge both
to direct chemical users and SME's in the downstream user supply
chain. Guidance must be developed so that SMEs are able to comply
with the requirements. Guidance targeted at SMEs has been found
to be helpful for all organisations, as the risk of becoming too
specialised increases the risks of non compliance.
Evaluation
23. The competent authority of the relevant
Member State may conduct an examination of the testing proposals
contained in the registration and/or a compliance check of the
technical dossier submitted at registration. In both cases the
registrant may be required to submit additional information. The
CBI welcomes the distinction between testing and dossier evaluation
and substance evaluation. However the system is still unnecessarily
complex and burdensome, with significant risk of legal uncertainty.
It is envisaged that Member states will be responsible for the
evaluation of the Dossier (testing proposals and compliance checks)
as well as for further Substance Evaluation. Although criteria
for further evaluation will be established there is still the
freedom for any Member States to initiate further evaluation.
The Agency will develop criteria for the harmonisation of the
substance evaluation process and the prioritisation of substances
within that process. It is essential that criteria are developed
as to the conditions that might lead to the evaluation process
being initiated for a given substance. Once the evaluation process
has been initiated by Member States there is no indication of
the end point of the process. The aims, objectives and end point
of the evaluation process need to be clearly stated and defined
within the Regulation. We would like to see these criteria developed
as soon as possible as we feel that prioritisation is vital to
make the REACH process work in practice. It is also crucial that
Member States work closely and coordinate with the Central Agency
to take a harmonised approach to evaluation to prevent inconsistencies.
Authorisation
24. Authorisation aims to ensure that the
risks from substances of very high concern (category 1 and 2 CMRs,
PBTs and vPvBs and others such as endocrine disrupters) are controlled,
or that suitable substitutes are found. The scope of the authorisation
process in particular to "substances of equivalent concern"
provision (Article 54) is too broad and subjective. Only chemicals
selected on the basis of sound scientific evidence should be subject
to authorisation. Authorisations are granted by the Commission
where risks are adequately controlled, or where the socio-economic
benefit outweighs the risk. We are concerned that the need to
include substitution plans for substances authorised for socio-economic
reasons could be used to effect a time-limited authorisation and
ultimately lead to the substance being restricted, whether a suitable
substitute exists or not. Substitution should be encouraged in
applications where less hazardous alternatives are available but
for substitution to work in the context of REACH, substitution
plans must be realistic, holistic and engage downstream users
as well as producers if they are to be implemented effectively.
Inflexible imposition of substitution plans on EU producers will
only cause down stream customers to switch sourcing of ingredients
rather than cooperating with a substitution process.
Restriction
25. Substances which are considered to pose
a risk to the environment or human health and where the risk is
not adequately controlled may be restricted or banned on a Community-wide
basis. We would like to see detailed criteria for the imposition
of restrictions drawn up as soon as possible in order to assist
harmonisation.
Information flow
26. It is not clear from the proposal what
the language requirements will be for information to be generated,
exchanged and disseminated. Most firms, especially SMEs, will
not have the resources to translate or deal with multiple language
submissions. It is suggested that this is another area for which
the Agency could have greater input.
January 2004
| 
