OUR THOUGHTS ON:

Manufacturing Alert: European Union REACh Regulations Continue to Advance

Business Advisors|Manufacturing

By Richard McKenna

If your organization manufactures or imports chemicals of any kind into the European Union (EU), then you are probably already aware of REACh. This far-reaching regulation covers all 27 countries in the EU and requires companies to submit a formal dossier outlining the specific properties, risks and impacts of the chemicals used in their products.

Officially, REACh is an acronym for Registration, Evaluation, Authorization and restriction of Chemicals. This regulation went into effect in 2007, and its implementation will be complete in 2018. Importers to the EU are subject to a phased-in implementation based upon the number of tons of each chemical is imported. Small and medium-sized importers are currently working through the process in order to be compliant by 2018. Large importers had to be compliant by 2010.

If your organization exports materials or products to the EU, then you eventually will be required to be registered and compliant. If you haven’t started the process, you are already late. Failure to complete the REACh process will permit EU countries to stop your products at customs.

The intent of this regulation is to identify and control the use and disposal of chemicals that are entering the EU. The regulation covers all products from raw chemicals to ink and toner cartridges. This regulation is complex and will take time to evaluate and implement in any organization. In addition your suppliers will be impacted. The REACh regulations may require you to document and analyze the chemicals used by your suppliers in the production of the materials and goods they sell to you.

There are several steps to the process:

  1. Registration: Each organization must submit a dossier for each chemical to ECHA (European Chemical Agency) for a formal review. This dossier contains details regarding the properties and risks for the chemical and how these risks can be managed through the supply chain. Fees for this registration vary.
  2. Evaluation: Based on the dossier, and the amount of product/chemical that will be imported, the agency will conduct a compliance check, as well as a variety of reviews to make sure the dossier is complete and accurate. Your dossier may be compared to other similar chemicals as reference. In some cases, the ECHA may order additional testing to supplement your data.
  3. Authorization: Substances with a very high concern (SVHC) will need to be authorized for specific uses. The European Commission keeps a list of SVHC, and the chemicals you use may be on that list. The ECHA might also ask for an alternative to a dangerous chemical if one is available. It is important to note that even normal everyday chemicals will need to go through this process.
  4. Restrictions: Unless the chemicals used in your products are approved, they can be restricted. This means that they (the products) cannot be imported into the EU.

Many in the US are opposed to REACh in its current format. The US government is currently developing the Safe Chemicals Act which looks to impose similar regulations on domestic chemicals. Either way, closer regulation of the chemicals used in the world wide supply chain is coming in one form or another. Your organization needs to be ready.

If you would like more information about REACh and some of the resources available to you, please contact Schneider Downs' Manufacturing Industry Group.

© 2012 Schneider Downs. All rights-reserved. All content on this site is property of Schneider Downs unless otherwise noted and should not be used without written permission.

This advice is not intended or written to be used for, and it cannot be used for, the purpose of avoiding any federal tax penalties that may be imposed, or for promoting, marketing or recommending to another person, any tax related matter.

You’ve heard our thoughts… We’d like to hear yours

The Schneider Downs Our Thoughts On blog exists to create a dialogue on issues that are important to organizations and individuals. While we enjoy sharing our ideas and insights, we’re especially interested in what you may have to say. If you have a question or a comment about this article – or any article from the Our Thoughts On blog – we hope you’ll share it with us. After all, a dialogue is an exchange of ideas, and we’d like to hear from you. Email us at contactSD@schneiderdowns.com.

Material discussed is meant for informational purposes only, and it is not to be construed as investment, tax, or legal advice. Please note that individual situations can vary. Therefore, this information should be relied upon when coordinated with individual professional advice.

© 2018 Schneider Downs. All rights-reserved. All content on this site is property of Schneider Downs unless otherwise noted and should not be used without written permission.

comments