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EU chemicals policy - REACH

Questions and answers: Costs, competitiveness, innovation and safety
 
REACH has been the subject of many regulatory impact assessments. What do they tell us?

Since the Commission published its original proposal in 2003 REACH has been  the subject of over 50 impact assessments across the EU. In May 2006 a partial impact assessment prepared by the UK Government estimated that direct costs to UK industry would be £404 million over the 11 years of registration, or nearly £37 million per year.  However, this represents a saving of £111 million (or just over £10 million a year) on the Commission’s original 2003 proposal, which put the cost at £515 million (or just over £47 million per year) for this period.  A study commissioned by the UK Government into the indirect costs concluded that the costs of REACH were likely to be absorbed by industry without having a significant impact on competitiveness, investment in the UK or market structure. However, the RIA concluded that although the number of substances withdrawn from the market may not be high, such product rationalisation (if it occurred) was most likely to affect low volume substances and those produced by SMEs. These were similar findings to the Commission’s own study of indirect costs.

 
What is the anticipated cost difference of the REACH Regulation, compared with the original Commission proposal?

Overall, the final agreed text of the REACH Regulation should result in cost savings across the EU of around €660 million (£470 million) compared to the original Commission proposal.  This is largely through an improved registration process, particularly implementing OSOR and the removal of one test (reproductive toxicity) in the 10-100 tonne band.

 
What are the predicted changes to costs for substances in the 1-10 tonnes bracket?

The approach for registering substances at 1-10 tonnes achieves the right balance between cutting costs and obtaining information on substances of concern, without unnecessarily increasing Agency bureaucracy.  It is estimated that this will significantly reduce costs for an estimated 70-90% of substances in this tonnage range that would not require a full Annex VII dossier.  This should help reduce the chances of small volume substances being withdrawn from the market.

The remaining 10-30% of substances are expected to will be identified as being of concern (based on clear criteria).  In these cases additional information will be required in order to make a proper assessment of risks.  This would increase the costs for many of these substances, but OSOR still encourages sharing of the registration costs.

 
What will be the benefits of REACH?

REACH aims to ensure a high level of protection to human health and the environment, as well as the promotion of alternative methods for assessing hazards of substances, while promoting the sustainability of chemical production and use.  Specifically, REACH should:

  • Improve the quantity and quality of data available on substances, preparations and substances in articles. This information will enable appropriate risk management measures to be identified (through Chemical Safety Assessments) for substances and their uses.
  • Increase communication through the supply chain. Along with information on substances and their management, this should help companies through the supply chain to manage chemicals safely by filling data gaps, identifying how to manage chemical risks, and addressing current inefficiencies in Safety Data Sheets. In turn, this should promote a greater level of confidence in the chemicals industry that has previously suffered from poor public perception, sometimes triggered by a lack of information on chemical risks.
  • Create market opportunities for safer products and services. From improving the communication of risk information to the application of the substitution principle under the authorisation process, REACH should provide incentives for companies adopting safer processes and products. Several mechanisms have been incorporated into REACH to foster innovation, such as exemptions for substances used for PPORD and raising registration/notification thresholds from 10 kg to 1 tonne.
  • Increase the incentives to innovate in product development by removing the way existing legislation differentiates between the requirements placed on new and existing substances.
  • Promote the use of non-animal testing. Compared to current chemicals legislation, REACH places an emphasis on the use of non-animal test systems which will limit the need for animal testing.

The May 2006 UK partial impact assessment estimated that 18-37 cancer deaths would have to be prevented per year for REACH to break-even (based on the Commission’s original proposal).  The Commission’s extended impact assessment gave an indicative figure of €50 billion (£35.7 billion) over the next 30 years, relating to benefits to human health only.

 

 

Page published: 4 July 2007

Department for Environment, Food and Rural Affairs