Eversheds SHINE Reach, September 2013 presentation slides

Is REACH impacting on your business?

Elizabeth Shepherd, Partner,

Sonya Veitch, Associate Eversheds LLP

26 September 2013


Today’s speakers

Elizabeth Shepherd Partner

Sonya Veitch Associate


• What is REACH?

• REACH Registration

• Supply Chain Communication

• Enforcement and penalties

• Overlaps with other regimes e.g. CLP and biocides

• REACH – the future

Agenda


• REACH Regulation No. 1907/2006

• Registration, Evaluation, Authorisation, and Restriction of Chemicals

• In force 1 June 2007

• ECHA

• Affects substances manufactured or imported into EU 1 tonne or more per year

• European Economic Area e.g. includes Norway

• “REACH is a journey that takes place over the years up until 2020” (ECHA's Kevin Pollard)

What is REACH?

REACH Registration

Do you have the registrations you need?


Which company could potentially be caught by REACH?

A. EU Chemicals manufacturer

B. Importer of shoes into EU

C. Oil and gas service company operating in EU

D. All of the above

Polling question


• D - All of the above

• Wide variety of companies affected

• Includes toy shops, fireworks display companies and mining and quarrying companies

The answer is...


• Manufacturer

• Importer

• Downstream user

• Only Representative - Non-EU manufacturer

Key roles under REACH


1. One registration per substance, per legal entity

2. Only an EU importer or EU manufacturer must register

3. Late pre-registration may be an option, depending on the type and quantities of the substance being imported or manufactured

Registration – the rules


• Who is the “importer”?

– not necessarily a straightforward question

– REACH definition not the same as customs

– keep under review

• Legal entity basis – not business units/plants

Are your pre-registrations/registrations held

by the correct company?


Outside EU EU

Registration obligations – practical example

Non-EU manufacturer

Company B (facility 2)

Group Company A

Company B (facility 1)

Imports 200 tonnes per calendar year




Company A and B are in the same group. Which one of the following statements is true?

A. The non-EU manufacturer must register

B. Either Company A or Company B can register for the group

C. Each of Company A, Company B (facility 1) and Company B (facility 2) must register (ie 3 registrations)

D. Company A and Company B must each register in respect of its own imports

Polling question


• D – both Group Company A and B will need their own registrations for the quantities they import

• The registration for Company B will cover imports to both facility 1 and facility 2

• The non-EU manufacturer cannot hold registrations/pre-registration

• More about Only Representatives later...

The answer is...


• Acquisitions, supply chain restructuring, moving your HQ outside the EU?

• Re-evaluate your REACH compliance

• Limited circumstances where registrations can be transferred - is it a qualifying legal change?

• KEY QUESTION: Do you have the registrations/pre-registrations that you need?

Registration obligations – issue spotting


Restructuring – practical example

EU Outside EU

Company A1 (manufacturer)

Company A2

Original supply chain

Company B (manufacturer)

Manufacturing relocated outside the EU


Despite the changes to the supply chain no changes to the REACH registrations are required.

A. True

B. False

Polling question


• False

• Company A2 should now hold the registration

• The registration/pre-registration held by A1 is no longer effective

• It is only possible to transfer registrations where a qualifying legal entity change occurs

The answer is...


• Are you entitled to appoint an Only Representative?

• Understanding your role in the supply chain for REACH purposes

– non EU-manufacturer

– toll manufacturing

– distributor

Non-EU manufacturers and distributors


• “R” = Registration

• Places burden on industry

• Data sharing – key requirement

• “E” = Evaluation

• 5% of dossiers – targeted checking

• REACH Review: “many dossiers non-compliant”

• Industry asked to improve quality

• Updating dossiers when required

Registration dossiers

Supply chain communication

What should you be doing?


• Recognised as a challenge

– significant cost for companies

– lack of understanding of requirements

– Safety Data Sheets (“SDSs”) have doubled in length

• Industry must respond

Supply chain communication


• Would your SDSs stand up to regulatory scrutiny?

• Dutch State Supervision of Mines guidance on common problems

• Ensuring systems in place to review and update

Focus on SDSs


• Particular challenge

• IT systems inadequate

• Long and complex supply chains

• 30 – 100 pages

• Mixtures – different approaches

• Costly translations

Focus on exposure scenarios


• Passing information up and down the supply chain

• “Less aware of their role in REACH” (REACH Review)

• Have you considered your duties?

• Do your suppliers understand their duties?

• SDSs

– is your use covered?

– what are your options if not

– challenge of managing exposure scenarios

Focus on downstream users

EU Supplier

DU

Communication of uses

SDS

Other challenges

Confidential information and keeping up to

date


• ECHA dossier dissemination

– public database

– extra information now published

• Only certain information can be kept confidential

• Registration – using Third Party Representatives

• SDSs – alternative chemical names

• Non- EU suppliers

Confidential business information


• 2010, 2013 registration deadlines have passed

• SIEFs active until 2018

• Monitoring tonnage bands

• New ECHA Guidance

• SVHCs – additional obligations

Keeping up to date

Enforcement and penalties

What’s the risk?


• “no data, no market” (Article 5)

• Member State level

• Variations across the EU

• Range of civil and criminal penalties

• Forum for exchange of information on enforcement

Enforcement and penalties


• Business interruption

• Contractual/customer relations

• Negative PR

Potential business consequences

Overlaps with other regimes

Biocidal Products Regulation, CLP


• Classification, Labelling and Packaging (CLP)

– transitional provisions until 2015

– closely linked to REACH

• Biocides

– still under the scope of REACH

– new Biocidal Products Regulation (September 2013)

– ECHA regulator

Overlaps with other regimes

REACH

Key points to take away


• Ongoing obligations

• 2018 Registration deadline – 1 tonne or more

• More companies must register

• New issues e.g. application for authorisation

• Nanomaterials – future developments

• Adopting REACH principles around the world

– K-REACH

– co-ordinated global approach

Looking to the future


• REACH is Law - ensure you comply

• Business changes – monitor, review and update

• Addressing particular challenges

• Enforcement – withstanding regulatory scrutiny

Key points to take away


Any questions


Elizabeth Shepherd

DD: 0845 497 8215

[email protected]

Sonya Veitch

DD: 0845 497 8159

[email protected]

Contact us

mailto:[email protected]

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