Reaching out for a chemicals compromise

Date: 07/04/05

The picture for EU chemicals legislation REACH (Registration, Evaluation and Authorisation of Chemicals) is now markedly different from that which policymakers were facing a few months ago. The position of affected industries - chemicals producers, manufacturers and retailers - has shifted from apparent opposition to acceptance and it now looks as though the law will pass in some form or another.

But REACH - which will force industry to register 30,000 chemicals and phase out the most harmful ones - has already been the subject of some inter-institutional battles and these are by no means over.

The European Commission irritated the European Parliament when its President José Manuel Barroso, perhaps anxious to establish his business-friendly credentials, announced in January that the EU executive would back changes to make the proposal more workable for industry. This was presented as part of the Commission's drive to boost European competitiveness but it gave the impression of pre-empting Parliamentary debate. The assumption now is that any changes will be made after the Parliament's first reading is completed, currently planned for October.

The Parliament itself has locked horns over which committee should lead on the dossier, resulting in a complicated ménage à trois between the environment, internal market and industry committees which now have the task of reaching consensus in just a few months.

And the political groups themselves have resorted to slanging matches, with the centre-right EPP-ED members complaining that they are unable to make headway as the Socialist rapporteur for the lead environment committee, Guido Sacconi, only speaks Italian and a bit of French. Meanwhile the Socialists accuse them of trying to kill the proposal. "The EPP-ED has been keen not to vote on this issue for a long time," says one Parliamentary official.

Inside the Commission, the Environment DG, led by Commissioner Stavros Dimas (see right), is having to defend its proposal against the more industry-friendly instincts of Competitveness Commissioner Gunter Verheugen.

The Council of Ministers has managed to stay out of the fray so far, and in December it informally supported a 'One Substance, One Registration' (OSOR) proposal from the UK and Hungary aiming to cut costs for smaller businesses.

But there is still significant ground to cover, particularly over the cost to industry of registering 30,000 chemicals over 11 years.

A round-up carried out by the Dutch presidency in November last year of the 36 various impact assessments made on REACH, showed that the costs for industry were "too high", particularly for small-medium-sized businesses (SMEs). It estimated the costs at about €4 billion for the EU25 (above the European Commission's estimate of 2.3bn euro).

But the studies also showed that the legislation would save €18-54bn over 30 years in healthcare costs for employees as well as provide "undisputed" benefits for society of tens of billions of euro until 2020.

A long-awaited and supposedly definitive impact assessment commissioned by European chemical federation Cefic and European employers' organisation UNICE shows that the costs are likely to be reasonable and that the risk of products being taken off the market is limited. The Commission has said that the study, which will be presented to the Commission's high level group on 27 April, will be the basis for adapting the proposal to meet industry concerns.

The industry has not stopped its fierce lobbying, however, and is pushing for registration to be based on the risk of a chemical rather than the quantity produced or imported. That approach is backed by European consumers' group BEUC.

As it stands, the Commission proposal would force the industry to register any chemical imported or produced in quantities greater than a tonne, but industry wants to register only basic data as well as the effects on humans and the environment. Additional data requirements would then depend on the exposure risk and a registration system would be set up accordingly.

The idea may have some supporters. One of the three MEPs responsible for the dossier, German centre-right deputy Hartmut Nassauer will incorporate the strategy into his report to the internal market committee due in the first week of May. He has the backing of the EPP-ED group and some Socialists, notably Germans supporting their country's huge chemical manufacturers.

But environmentalists have denounced the idea, saying it will simply allow industry to set its own standards. "How can you possibly judge the risk of a chemical without having the safety data which the registration process currently aims at gathering?" asks Julian Scola of the World Wide Fund for Nature's toxics campaign. WWF is stepping up its pressure on the REACH dossier by launching a programme to test volunteer families to find out how many toxic chemicals they have in their blood. Results are expected in October 2005. Environmentalists, backed by some MEPs, are demanding a strengthened policy to ensure that all high-risk chemicals are substituted, the OSOR proposal is adopted to cut costs and limit animal testing, and ensure that importers have to check that the chemicals in their products are registered in the EU.

All agree that the issue of how to treat imported goods (Article 6) needs clarity. Industry has argued that companies may simply relocate outside the EU in order to export their products, although according to the Cefic/UNICE impact assessment this is unlikely.

Industry is also railing over parts of the OSOR proposal arguing that, if the consortia idea becomes mandatory, it could force them to share confidential business information with competitors. Cefic wants an opt out from the system, which could limit its efficacy if the only companies willing to share their data are SMEs.

No one doubts that there is a mammoth task ahead and most difficult in the short term will be to reach the Parliament's goal of a first plenary vote in October. The timetable at present sees the internal market committee voting on Nassauer's risk-based approach in May, the industry committee adopting Swedish liberal Lena Ek's report in July and Sacconi's report for the environment committee being finalised in September.

Major analysis feature on the current debate on the proposed EU regulatory framework for chemicals (REACH). Article says that the picture for REACH was markedly different from that which policymakers were facing a few months earlier. The position of affected industries - chemicals producers, manufacturers and retailers - had shifted from apparent opposition to acceptance while inter-institutional battles in the European Union were still going on.