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‘No deal’ ramifications for chemical sector explained

23 October 2018

THE HEALTH and Safety Executive (HSE) has provided an update on the ramifications for regulating chemicals in the event of no deal being agreed during BREXIT negotiations.

In the event of a no deal, the UK would ensure UK legislation replaces EU legislation via the EU Withdrawal Act, establish a UK regulatory framework and build domestic capacity to deliver the functions currently performed by ECHA. The legislation would preserve REACH as far as possible, while making technical changes that would need to be made because the UK has left the EU.

By doing this, the HSE says the UK would continue to be able to monitor and evaluate chemicals in the UK to reduce the risk posed to human health and the environment. It would also minimise disruption to the supply in chemicals. Existing standards of protection of human health and the environment would be maintained. 

The HSE would act as the lead UK regulatory authority, from the day the UK leaves the EU, building on its existing capacity and capability.

The new regulatory framework would: enable the registration of new chemicals through a UK IT system that is similar to the existing EU IT system; provide specialist capacity to evaluate the impact of chemicals on health and the environment; ensure sufficient regulatory and enforcement capacity in the HSE, the Environment Agency (EA) and other regulators, enabling them to recommend controls in response to the hazards and risks of substances; and provide for an appropriate policy function in Department for Environment, Food & Rural Affairs (Defra) and the devolved administrations.

In a ‘no deal’ scenario the UK would not be legally committed to medium- or long-term regulatory alignment with the EEA.

Companies registered with REACH would no longer be able to sell into the EEAmarket without transferring their registrations to an EEA-based organisation. Companies would therefore need to take action to preserve their EEA market access.

UK downstream users currently importing chemicals from an EEA country would face new registration requirements. Under the UK’s replacement for REACH, importers would have a duty to register chemicals. Similarly, UK downstream users of authorisations would no longer be able to rely on authorisation decisions addressed to companies in the remaining EEA countries.

The HSE says this approach is designed to maximise continuity in as light a touch way as possible, consistent with the requirements of REACH that are being brought into UK law through the EU Withdrawal Act. It provides a transition period before full obligations would fall on the importers who would otherwise be most affected.

To ensure continuity for business we would:

  • Carry across existing REACH registrations held by UK-based companies directly into the UK’s replacement for REACH, legally ‘grandfathering’ the registrations into the UK regime;
  • Set up a transitional light-touch notification process for UK companies importing chemicals from the EEA before the UK leaves the EU that don’t hold a REACH registration. This would reduce the risk of interruption in supply chains for companies currently relying on a registration held by an EEA-based company. This would mean that those UK companies could continue to buy those chemicals from the EEAwithout any break; and
  • Carry into the UK system all existing authorisations to continue using higher-risk chemicals held by UK companies

To ensure the HSE has the information needed to regulate the safe use of chemicals, UK firms would need to take the following action:

  • Businesses with existing EU REACH registrations being automatically grandfathered into the UK regime or authorisations would have to validate their existing registration with the UK authority (the HSE), opening an account on the new UK IT system and providing some basic information on their existing registration within 60 days of the UK leaving the EU. This IT system is being tested with a range of different users so that it is ready to support registrations of chemicals in the UK from March 2019;
  • Companies with grandfathered registrations would have two years from the day the UK leaves the EU to provide the UK authority (the HSE) with the full data package that supported their original EU registration and is held on the ECHA IT system;
  • Businesses that imported chemicals from the EEA before the UK leaves the EU (but who did not have an EU REACH registration), would need to notify the UK authority and provide some basic data on the chemicals within 180 days of the UK leaving the EU, instead of having to undertake a full registration immediately. This would be an interim arrangement for those importers and they would need to move to full registration at a later date following a review of this approach; and
  • Importing businesses would be responsible for identifying appropriate risk management measures and recommending them to their customers.

If a business wished to place new chemicals on both the EEA and UK markets, in a ‘no deal’ scenario, they would have to make two separate registrations, one to ECHA and one to the UK. The information and data package needed would be the same for both.

UK companies with existing REACH registrations wishing to maintain EEA market access would need to refer to guidance on the ECHA website on the steps they would need to take. Existing UK registrants would, for example, need to transfer their registrations to an appropriate EEA-based entity (such as an affiliate or an OR) or develop new working relationships with their EEA customers. This would require action before the UK leaves the EU.

UK companies wishing to register new chemicals for the EEA market after the UK leaves the EU would need to register those with ECHA as they do now, but would need to do so via their EU customers or an OR. Further guidance on how to do this can be found on the ECHA website.

The Irish government have indicated they would need to discuss arrangements in the event of no deal with the European Commission and EU member states.