Chemicals review: German industry asks for new REACH

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Published 18 September 2003, updated 03 September 2012

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REACH

On 16 September, the German industry federation BDI sounded the alarm bell over the EU's plans for stricter legislation on chemical substances, stating the current proposals would lead to a loss of 1.7 million jobs.

After having consulted stakeholders in the course of 2001 on its White Paper "Strategy for a future chemicals policy", the Commission presented in May 2003 a first 1,200 pages outline of its legislative proposals in a consultation document. It started an 8-weeks internet consultation on the workability of its proposals. More than 6,400 comments were sent in, half of them coming from the downstream user side.

The German industry, which had opposed the plans from the start, asked corporate consultants Arthur D. Little for a second economic assessment of the Commission's proposals. At the end of 2002, Arthur D. Little had already undertaken a first study based on the White Paper's orientations.

The results of the new study indicate that the current proposals in the Commission's consultation paper would lead to a gross value added loss of 4.7 per cent. More than 1.7 million jobs would be at risk if the proposals were to become law.

Positions:

In its press conference in Brussels on 16 September, the German industry federation BDI called for "a new REACH", which should consist of three elements:

the new REACH should focus on the "most problematic" substances, instead of targeting all substances at the same time;
communication in the supply chain between producers and users of chemical substances should be better organised;
the Commission should conduct pilot projects in order to test how the major elements of its proposals would function in practice.

The French government has also been warning that the Commission proposals would undermine the competitiveness of the European chemicals industry and lead to job losses (see

EurActiv 16 September 2003).

In the UK, Trade and Industry Secretary Patricia Hewitt announced on 16 September that her country is ready for a showdown with the Commission on this legislation as it would "destroy the European chemicals industry".

Environment NGOs have repeatedly questioned these economic impact assessments, accusing the industry of scaremongering over job losses and forgetting about positive effects for health and the environment. For the NGOs, the chemicals debate has also become a test case, but then on the commitments of the EU concerning its sustainable development strategy. In a reaction to the new Arthur D. Little report presented by the BDI, the Greens in the European Parliament accused the report o f being "detached from economic reality". They criticised the methodology of the study, pointing to a critical

assessment of the first study by the Federal Environmental Agency (Umweltbundesamt)in February 2003.

In an

impact assessment, prepared for the Commission's DG Enterprise in June 2002, the results are not as dramatic as predicted in the two Arthur D. Little studies and the study even foresees an important impetus for innovation thanks to the clearer rules. An independent evaluation of the different impact assessments was undertaken in July 2003 by the German "Rat von Sachverständigen für Umweltfragen" (Council of Environmental Experts). According to this advisory body to the German government, the studies done for the chemicals industry overestimate the new system's economic impact and underestimate the advantages for environment and health (see )

Next steps:

The Commission is expected to present its final legislative proposals on 29 October.

Background:

The revision of the EU's chemical substances policy aims at improving the testing of chemical substances before putting them on the market. Currently, around 30,000 chemicals are used in all kind of products without ever having undergone serious public testing. Worries over the impact of these chemicals on the environment and public health have led to this revision.

The key elements of the proposed legislation are:

the introduction of the "REACH" system to Register, Evaluate and Authorise new CHemicals under the supervision of a new European Chemicals Agency;
the obligation for the chemical industry to provide safety data and risk assessments of the new chemicals it puts on the market;
lesser registration requirements or exemptions for chemical substances used to produce other chemicals;
provisions to reduce animal testing.

For the whole of industry, the revision of the chemicals policy has become the test case for the EU's seriousness about its Lisbon agenda of becoming the most competitive knowledge economy by 2010. As chemical substances are used in every product put on the market (e.g. more than 10,000 individual substances are involved in the production of a car), the proposals affect more than just the chemicals industry.