SGS Explains the Importance of Good Communication in Supply Chains When Complying with REACH

Recent changes in REACH regulations reinforce the importance of good supply chain communication for businesses operating in the EU/EEA. End Quote

(1888PressRelease) October 24, 2018 - Harmful chemical substances are around us all the time. The European Union’s (EU) REACH (Registration, Evaluation, Authorization and Restriction of Chemicals) regulations are designed to control chemicals and protect us and the environment from their potentially harmful effects while fostering commercial competition and innovation in European industry.

REACH entered into force in 2007 and is administered by the European Chemicals Agency (ECHA). It requires businesses operating in the European Economic Area (EEA) to register information on the hazards, risks and safe use of chemical substances they manufacture or import. The burden of proof is placed upon businesses, who must prove that a chemical substance can be used safely. Part of the long-term strategy of the regulation is the removal of hazardous substances from products and their substitution with less dangerous alternatives.

To comply with the requirements of REACH, it is important for companies to understand which chemicals are contained in their products. This can be difficult, however, if they have long supply chains and multiple components.

Substances known to be carcinogenic, mutagenic, toxic for reproduction or persistent, bioaccumulative and toxic are referred to as substances of very high concern (SVHCs). These substances are included in the ECHA’s Candidate List. This list is expected to contain between 400-500 substances by 2020.

Article 7(2) of REACH requires economic operators to notify the ECHA if an article they manufacture or import contains an SVHC on the Candidate List when it meets these conditions:
• Substance is present in a concentration above 0.1% w/w
• Substance is present in the articles in quantities equaling or exceeding 1 metric tonne per producer or importer per year

In addition, Article 33 requires suppliers of articles that contain an SVHC at a level above the 0.1% threshold to inform recipients about the SVHC. They should also, when requested, make the same information available to consumers within 45 days.

There was, however, a problem of interpretation – does the 0.1% threshold apply to a complex object or each component article incorporated into the whole?

‘Article’ is defined in REACH Article 3(3) as, an “object which during production is given a special shape, surface or design which determines its function to a greater degree than does its chemical composition.”

A ruling by the European Court of Justice in 2015 stated that the 0.1% threshold applied to, “each of the articles incorporated as a component of a complex product.” Manufacturers and importers need to be sure they understand how the rules apply to their products as different rules may apply.

Therefore, most products we find in the home will be complex objects made from many individual articles. Stakeholders should note, however, that when complex objects like a bike are considered, the components are, in effect, also articles. The seat, for example, is both an article and a component of the complex object.

Eurostat data shows that the EU produced and sold more than EUR 3 trillion worth of products within EEA markets in 2015 and a further EUR 1.7 trillion were imported into and sold within the EU. The application of REACH may, however, create a potential economic imbalance weighed against European manufacturers, which would go against one of the primary objectives of REACH – the promotion of EU industry.

This is because, REACH applies to the production and use of chemical substances within the EU/EEA. It also applies to chemical substances that are imported into the EU but does not apply to articles that are produced outside the EEA and which incorporate SVHC. Articles, and articles that are components in complex objects manufactured in the EU, are therefore exempt from the requirements for SVHC authorization. Stakeholders should be aware the rules relating to substances restricted in Annex XVII do still apply and these are often cited in RAPEX reports as a reason for a product being withdrawn.

To level the playing field for European businesses, it has been suggested the authorization requirement regarding SVHC should be extended to covered imported articles. The German Environment Agency (UBA) has appraised the suggestion for legality and believes it is in accordance with World Trade Organization (WTO) rules since it would neither violate the principles of national treatment and most-favored nation treatment, nor constitute an unnecessary obstacle to trade.

If this extension is enforced, economic operators importing articles into the EU/EEA would need to be certain their products or components containing SVHC do follow the same rules as EU/EEA based manufacturers.

Another reason stakeholders need to remain cognizant of changes to REACH is the announced in July 2018 that the ECHA is establishing a new database to give waste treatment operators and consumers better information on the presence of hazardous chemicals in the products they discard or recycle as waste. This forms part of the EU’s revised waste framework directive, which entered into force in July 2018.

The database has multiple objectives:
• Better risk management of chemicals during waste recovery
• Promotion of non-toxic material cycles
• Better consumer information to allow more informed choices on safer products
• Increased pressure to replace substances of concern

The new database reinforces, once again, the importance of good communication along supply chains. Correct information concerning hazardous substances must be communicated along the supply chain, no matter what the country of origin. Without this, it may be impossible to transfer accurate information to the ECHA.

ECHA created a Draft Scenario and Technical Supporting Document providing further details about the database on articles containing Candidate List substances. The two documents provide detailed information about the expected reporting level for articles and complex objects as well as the information requirements.

REACH’s scope and intricacy can mean it is difficult for economic operators to navigate. The enforcement of the 0.1% threshold, the proposal to extend the requirements concerning SVHC to include articles imported into the EU/EEA, the restricted substances listed in Annex XVII, and the announcement of a new database covering articles containing SVHC on the Candidate List, all highlight the importance of good supply chain communication in understanding what chemical substances are contained within a product.

It is only through fully understanding the rules, and ensuring they have the correct information passed along the supply chain, that companies can be assured they are complying with EU rules regarding SVHC.

SGS REACH Services
SGS keeps interested parties informed about developments and changes to REACH regulations. Their expertise, combined with consultancy services and experience in consumer product supply chains, provides a central point of contact for global solutions. Learn more about SGS’s REACH Services. [www.sgs.com/reach]

For more information, please contact:

Dr. Udo Krischke
Global Technical Manager RSTS & Operational Integrity Manager
SGS Germany GmbH
Tel: +49 (0)6128 - 744 235
Email: crs.media ( @ ) sgs dot com
Website: www.sgs.com/softlines

About SGS
SGS is the world’s leading inspection, verification, testing and certification company. SGS is recognized as the global benchmark for quality and integrity. With more than 95,000 employees, SGS operates a network of over 2,400 offices and laboratories around the world.

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