Select Committee on Science and Technology Written Evidence


Memorandum from the Society of Motor Manufacturers and Traders Limited

  1.  SMMT is the leading trade association for the UK automotive industry. SMMT provides expert advice and information to members as well as to external organisations. It represents some 600 member companies ranging from vehicle manufacturers, component and material suppliers to power train providers and design engineers. The motor industry is an important sector of the UK economy. It generates a manufacturing turnover approaching £45 billion and supports around 850,000 jobs.

  2.  SMMT took part in the May internet consultation launched by the European Commission and expressed its views on the draft legislation. The new legislation will not only affect chemical manufacturers, but also downstream users, who face issues related to the use of thousands of chemicals during the manufacturing process. Downstream users will be responsible for demonstrating the safety of the chemicals used and for disclosing required information to the public.

  3.  SMMT supports the public's right to know about any hazards associated with the use of chemicals. However, the Society believes that any regulation in this area should provide downstream users with practical and necessary information in the least burdensome way. If the system is successfully implemented, it should reduce impacts on human health and the environment resulting from exposure to harmful substances and enable downstream users to have information and knowledge about all the chemicals they use in the manufacturing process and increase the overall transparency.

  4.  Regulating chemical substances will have a great impact on manufactured products. As an indication of the difficulties faced by the automotive industry, the average vehicle is comprised of up to 10,000 substances, and it is estimated that all these substances minus any partial exemptions such as polymers, would come under REACH.

  5.  The final Commission proposals showed important improvements compared to earlier drafts:

    —  registration costs for low-volume substances are reduced;

    —  information through the supply chain is facilitated through the "Safety Data Sheet";

    —  protection of confidential business information is strengthened;

    —  the role of the central agency is also strengthened; and

    —  the scope of REACH is reduced.

  6.  However, SMMT is still concerned that the proposals fail to take into account the many issues related to downstream users. The automotive industry is already subject to extensive regulation and REACH should ensure that legislation is not duplicated to avoid conflicting requirements. In particular the new proposals still fail to address four key points:

    —  The need of a risk-based approach—SMMT strongly believes that prioritisation of substances and of information requirements for their registration should depend on risk instead of tonnage.

    —  Substitution Principle—Dangerous chemical substances should only be substituted if the safety of alternative substances has been scientifically tested. Substitution plans should respect the lead times and product life-cycles specific to various industries.

    —  International Competitiveness—SMMT believes that REACH as proposed could lead to cost increases and negative effects on international competitiveness.

    —  Focus on individual uses to be removed—SMMT believes that standardised "exposure categories" should replace the use specific scenarios.


  7.  In May SMMT called for the regulation to embrace a risk based approach rather than an approach based on substance production volumes. However, the proposals adopted by the College of Commissioners in October failed to take this into consideration. Industry highly values the importance of manufacturing and marketing safe products, and it is in the interest of producers and users of chemical substances to produce and market safe and tested goods.

  8.  The automotive industry strongly believes that prioritisation of substances should depend on risk instead of tonnage. Industry accepts that is in everybody's interest to introduce more stringent testing requirements for dangerous substances, even if used in small quantities. It is essential to identify where the real concerns are and to channel resources to address those concerns adequately. Based on the experience gained here, lower risk substances could then be examined at a later stage.


  9.  SMMT believes that REACH as proposed could lead to cost increases and negative effects on European competitiveness. We understand that the Commission believes that one of the keys to defending the competitive position of the European chemicals industry is making every effort to ensure that new EU legislation become the international norm.

  10.  However, what is in principle a worthy statement in practice fails to address and assess the reality of the global business environment. The Commission's proposal has undoubtedly unintended competitive effects, as EU producers of articles will have to cope to a much greater extent than non-EU producers with the provisions of the regulation. European downstream users will be at significant disadvantage in terms of cost and ability to innovate when compared with non EU competitors. Companies that are able to do so will be likely to be forced to increase non-EU sourcing.


  11.  SMMT believes that standardised "exposure categories" should replace the use specific scenarios currently envisaged by the proposals. The proposed use specific scenarios raise issues related to confidentiality, flexibility and workability.

    —  Confidentiality—Downstream users may not want their suppliers to know how a particular substance is used.

    —  Flexibility—Downstream users may want to use a substance for a specific use not originally communicated to the supplier of chemicals.

    —  Workability—A small European firm, which lacks relevant staff time and training, may find it impossible to communicate all the uses of a substance to an overseas importer of chemicals.


  12.  REACH, which will overhaul the way chemical substances are regulated across the EU, will greatly affect not only the Chemical industry, but also the many downstream users. SMMT believes that all its members will be affected by the new legislation, considering that each vehicle is manufactured from 10,000 to 15,000 components, comprising up to 10,000 substances. Overall, we believe that the impact of the proposals will be greater than that of other recent substance restriction legislation such as the ELV Directive.

  13.  It is also unclear exactly how the proposed requirements would affect the automotive supplier community. Manufacturing a complex automotive component can involve a number of transactions among various automotive suppliers that may be based in different countries. In some instances, confidential information may need to be maintained as these transactions take place.

  14.  SMMT calls for the proposals to be used as an opportunity to put in place an effective framework that will protect consumers from dangerous chemicals, without acting as a trade deterrent to EU member countries or being overly burdensome on businesses.

January 2004

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