The REACH Regulation, applying as it does to all chemicals placed on the EU market, is one of the most ambitious legislative frameworks ever to have been placed on the EU statue book. It is therefore no surprise that its post-Brexit implementation for the Great Britain market (as retained EU law) presents a number of significant challenges.
In this article, we explore how UK REACH, the parallel (but entirely independent) legal framework for chemicals management in Great Britain, has fared so far, and consider the road ahead.
'Transitioning' to the status quo
A key feature of REACH is the principle of 'no data, no market'. It is for industry to provide data about a substance's hazard properties to the regulator in the form of a registration dossier. For most existing chemicals, dossiers have now been submitted to the European Chemicals Agency (ECHA), over a period of nearly a decade. Since no agreement was reached between the UK and the EU on sharing the data within the existing EU database, UK REACH currently requires companies to submit that data again to populate a new UK-only registration database. Industry has estimated that this exercise will cost them £1 billion.
With such eye-watering investment required simply to maintain the status quo, stakeholders from all sides of the debate are asking if 'going back to square one' for substance registration is really the best approach. However, for the time-being at least, the law as it stands requires that industry produce EU-style dossiers and acquire access to all necessary data – albeit with the pain temporarily deferred by transitional arrangements.
The current transitional arrangements required an initial light-touch notification to be made to the Health and Safety Executive (HSE) during the course of 2021, with a 'full registration' obligation to follow, when all required substance data must be submitted. Depending on the 'tonnage band' (i.e. the volume placed on the market) and hazard profile of the substance, the extant transitional provisions require such data within either 2, 4 or 6 years from October 2021.
The UK-centric focus of the transitional arrangements did little to support EU businesses supplying into Great Britain, and arguably failed to recognise the complexity of chemical supply chains. Although many EU companies could continue to supply their existing customer base, they were reliant on those customers making a notification to the HSE: many did not do so. Perhaps more significantly, none of the transitional arrangements allow an EU business to supply new GB customers, effectively freezing the market as it was in 2019 and 2020.
The global pandemic and Ukraine crisis mean that supply chains already look very different. EU companies that want to supply new customers in GB must pay the registration fees to do so, even if the supplies are covered by an EU registration. In the absence of a statutory mechanism to support such businesses, the HSE has taken a pragmatic approach: it has introduced a 'new registration, existing substance' concept (known as 'NRES') in which, although a registration must be submitted and the appropriate fees paid, the dossier can be submitted with a waiver to say the data will follow. In this way, those obliged to register now can still benefit from the transition timescales. There is however no statutory basis for the NRES, it is simply pragmatic enforcement of the rules, causing some raised eyebrows.
Moving towards a ‘new model’ for transitional registrations
In December 2021 UK Government published an open letter confirming that it recognises "industry concerns around accessing data packages to support UK REACH transition" and the associated cost to businesses. As a result, Defra, along with the HSE and Environment Agency, has been tasked with exploring "a new model for transitional registrations", with the stated objective of "placing a greater emphasis on improving our understanding of the uses and exposures of chemicals in the GB context". This may be a significant development, but creates yet more uncertainty for business: many are left wondering what action to take in the interim.
To allow time for the new approach to be developed and legislated for, UK government is consulting on extending the deadlines for submitting the full data dossier. Defra has proposed to extend the first data submission deadline by another 3 years to 2026, with 2 options for the spacing of the subsequent submission deadlines, which would continue to be based on production tonnage and hazard profile, as follows:
- option 1 proposes data submission dates of October 2026, October 2028 and October 2030;
- option 2 proposes data submission dates of October 2026, October 2027 and October 2028.
Option 2 is Defra's stated preference. Both options will significantly extend the period before the HSE receives substantive data on which to make regulatory decisions, causing NGOs to complain that the UK slips further behind the EU.
Keeping pace with the EU?
In parallel, the EU marches ahead with its chemicals regulation. With its Green Deal and chemicals strategy for sustainability (CSS), the EU has set an ambitious agenda, with a focus on a circular economy and driving chemicals with hazard properties from the market. Significant legislative change will follow: despite being billed as modest reform, the practical reality may end up more like a REACH 2.0. New concepts are finding their way into the law, such as 'sustainable products' and ‘essential uses'. Significant changes are also anticipated to the authorisation and restriction procedures in due course, to deliver the CSS.
The UK’s own chemicals strategy is overdue: first promised in the 25 Year Environment Plan back in January 2018, the discussions with industry only actually commenced in April 2022. With the current uncertainty over the political direction in the UK, the publication of the strategy is likely to remain some way off.
Any system requires sufficient capacity to deliver on its stated objectives. With UK bodies now required to fulfil the full range of tasks currently shared between ECHA, the Commission and 27 EU member states, the clear difference in regulatory capacity between the two markets means that UK ambition must inevitably reflect limitations in its resources. By way of an example of the scale of the regulatory task, the HSE predicted that 26% of its overall capacity for 2021/2022 would be required simply for training and "understanding the legislation and associated guidance; learning processes and procedures; developing knowledge of regulatory science, especially in the area of toxicology."
With limited resources, it is not a surprise that the HSE is taking a risk-based prioritisation approach to its work programme. The recently published work programme for 2022/2023 is evidence that HSE will pursue a more focused, risk-based approach, covering less ground that its EU counterpart, and relying on work done within the EU – and elsewhere – rather than attempting to match the output under EU REACH.
Plotting an effective course will be critical
It was widely anticipated that REACH would be one of the legal regimes that would be most impacted by the UK's exit from the EU, and so it has proved. A recent report from the UK's National Audit Office echoes concerns raised by various stakeholders, from industry through to NGOs. The report recognises the significant efforts of government staff and regulators to transition to an independent UK REACH, avoiding significant market disruption; it also concludes that with much work still to be done, and in the absence of a long-term strategy, there is a real risk of "wasting effort on short-term work".
This analysis was first published on Lexis®PSL on 18 July 2022