New domestic regulatory regime
The UK chemicals industry is currently regulated under the EU Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) regulation. This requires chemicals manufactured in the European Economic Area (EEA) or imported into the EEA to be registered with the European Chemicals Agency (ECHA).
At the end of the transition period on 31 December 2020, most of the UK will leave the EU REACH regime. In its place, the UK Government intends to establish a separate domestic regulatory regime for Great Britain (GB). Northern Ireland will remain in the EU REACH regime. The Health and Safety Executive (HSE) will be established as the UK Chemicals Authority and will take over the functions of the ECHA. Companies manufacturing or importing chemicals for the GB market will need to register these chemicals with the UK Chemicals Authority. By establishing a domestic regulatory framework, the Government has said the UK will have greater autonomy and will be able to make decisions that will be “in line with what is best for the UK and the environment”.
Legislation governing the new regime passed so far
The following legislation applicable to this new regime has been passed to date:
- The REACH Enforcement Regulations 2008, which originally implemented the EU REACH regime in the UK. The EU REACH regulation will be retained in domestic legislation in accordance with the European Union (Withdrawal) Act 2018 (as amended).
- The REACH etc. (Amendment etc.) (EU Exit) Regulations 2019 (REACH SI) which amend the EU REACH regulation using powers in section 8 of the European Union (Withdrawal) Act 2018 to correct “deficiencies” in retained EU legislation.
These are referred to collectively as the UK REACH regime. However, Both of these pieces of legislation were passed before the Northern Ireland Protocol was agreed. Under the Northern Ireland Protocol, Northern Ireland will remain part of the EU REACH regime. Therefore, the UK REACH regime legislation will need to be amended if the UK’s obligations under the protocol are to be met.
Registering new information with UK Chemicals Authority
Registering chemicals involves companies obtaining the relevant safety information and providing it to the regulator. This information is often held by multiple companies and can involve complex copyright issues. For example, in 2018, the House of Lords European Union Committee warned legal concerns, including copyright, would require the UK to create its own database of registration information if the UK was no longer part of the EU REACH regime. Concerns have been raised about the cost to the UK chemicals industry of registering with the UK Chemicals Agency after the end of the transition period.
To support businesses facing this process, the Government has said companies in Great Britain with existing registrations with the ECHA will benefit from automatic registration with the UK Chemicals Authority at the end of the transition period. This process is referred to as ‘grandfathering’. However, subsequently these companies will be required to submit the full data to the UK Chemicals Authority. Under the current legislation, this data will be submitted to the UK Chemicals Authority in two stages. Companies will be required to make an initial notification within 120 days, providing basic data. The final transfer of information would then be required after two years.
Currently, until the end of the transition period, chemicals entering the UK from within the EEA do not require separate registration. After the transition period—as the legislation is currently drafted—UK companies bringing chemicals from the EEA into the UK market will be subject to additional registration requirements as importers. Again, the required transfer of data by these companies to the UK Chemical Agency will be in two phases: a 180-day period for the initial notification; and two years for the final transfer of information. As mentioned above, the Government intends to further amend these provisions in light of the Northern Ireland Protocol to facilitate ongoing access to the Great Britain market for qualifying goods from Northern Ireland.
Amendments to UK Reach regime
On 19 October 2020, the Government laid the draft REACH etc. (Amendment etc.) (EU Exit) Regulations 2020 before both Houses. It is a draft affirmative instrument, meaning it must be approved by both Houses before it can come into force. These regulations would make the following amendments to the current UK REACH regime legislation.
Implement Northern Ireland Protocol obligations
As discussed above, the REACH SI was drafted prior to the signing of the Northern Ireland Protocol. Therefore, the draft REACH etc. (Amendment etc.) (EU Exit) Regulations 2020 will amend the wording of the relevant legislation to reflect the fact Northern Ireland will remain part of the EU REACH regime.
The Government has said in the explanatory memorandum to the draft regulations that frictionless trade between Northern Ireland and Great Britain is a stated aim of the Northern Ireland Protocol. However, it also said that special arrangements were necessary because of the risks relating to highly regulated goods, such as chemicals.
Access to the GB market for qualifying Northern Ireland goods
The Government has also included the following measures in the draft regulations intended to address barriers to trade between Northern Ireland and Great Britain as a result of there being two separate regulatory regimes in the UK:
- Currently, only companies in Great Britain will be allowed to notify the UK Chemicals Agency that they are placing chemicals on the GB market. However, the draft regulations create an exemption to this rule for companies in Northern Ireland, allowing them to directly notify the agency.
- Instead of going through the full registration process before a substance can be traded on the GB market, companies in Northern Ireland will be able to submit a notification to the UK Chemicals Agency to begin trading. However, this is only in cases where the substances are already being traded in the GB market. The notification will have to be made within 300 days of the end of the transition period.
- Northern Irish companies will be able to apply directly to the UK Chemicals Agency for authorisation to place substances of very high concern on the GB market.
These provisions will only apply to qualifying Northern Ireland goods. Qualifying Northern Ireland goods are defined by the Definition of Qualifying Northern Ireland Goods (EU Exit) Regulations 2020, which have now been approved by both Houses.
Changes to data submission deadlines
As discussed, some companies will benefit from the automatic registration of substances with the UK Chemicals Agency as part of the grandfathering process. The draft regulations make changes to the deadlines for these companies to subsequently submit data to the UK Chemicals Agency. The Government has said in the explanatory memorandum to the draft regulations that these changes would “mitigate potential disruption to industry from the move to the new system”.
The draft regulations would extend the following deadlines:
- Companies that would become importers of chemicals into the GB market at the end of the transition period as a result of Great Britain leaving EU REACH will have up to 300 days from the end of the transition period to make their initial notification.
- The two-year deadline for the second phase of the process will be replaced for both grandfathered registrations in general and companies becoming importers into the GB market. The Government has said that, after the initial notification stage, there will be additional phases of two, four and six years, based on the tonnage band and hazard profile of the chemicals.
The House of Lords Secondary Legislation Scrutiny Committee has raised several issues regarding the plans for the implementation of the new regulatory regime for the GB chemical industry. It has drawn the draft regulations to the special attention of the House, saying it was “deeply concerned” about the impact and costs of introducing the new domestic REACH regime. For example, the committee has argued obtaining the data necessary to fully register with the UK Chemicals Agency would represent a significant burden on businesses.
The committee also raised concerns regarding measures in the draft regulations to further extend the time period for the submission of data to the UK Chemicals Agency. It heard evidence from the CHEM Trust, a chemical safety charity, who argued that extending the period to more than six years would hamper the ability of the agency to regulate the chemicals industry. The committee agreed that this could undermine the HSE’s ability to regulate chemicals properly.
Responding to these concerns, the Government said that, as part of the negotiations with the EU for a future trade deal, the UK would seek to agree a deal on data sharing, referred to as a chemicals annex. It argued this would mitigate the need for the chemicals industry to provide full data packages to the agency.
The committee also said the HSE was not prepared to take on its new role as the UK Chemicals Agency, arguing it had not yet recruited and trained the necessary expert staff. Similar concerns had been raised previously by Sub-Committee B of the Secondary Legislation Scrutiny Committee in its report on the REACH etc. (Amendment etc.) (EU Exit) Regulations 2019. Following on from these concerns, the committee noted that, in 2020, staff training and recruitment was still not complete. The committee said:
We note particularly that HSE has made around 30 job offers to date, compared to its target of recruiting 130 new staff. While HSE aims to complete this target by the end of the financial year 2020/21, the new domestic regime will become operational on 1 January 2021. It is also not clear how many of the job offers made by HSE have been accepted and given that staff may also have to give notice, we are further concerned about the operational consequences of HSE not being able to complete its recruitment by 1 January 2021.
The committee also criticised the Government for not providing analysis of the costs of the new domestic REACH regime.
House of Lords debate
The House of Lords is scheduled to debate the regulations on 8 December 2020. A date for the debate in the House of Commons has not yet been set. The Shadow Spokesperson for Environment, Food and Rural Affairs, Baroness Hayman of Ullock, has tabled the following ‘regret motion’ which will also be debated:
To move, as an amendment to the motion, at end to insert “but that this House regrets that the Regulations (1) fail to provide an analysis of the costs of the new domestic Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) regime, (2) introduce additional costs and administrative burdens for United Kingdom businesses, and (3) create unacceptable risks around the availability of chemicals safety data; notes concerns about the ability of the Health and Safety Executive to fulfil its additional responsibilities when the domestic REACH regime becomes operable on 1 January 2021; and further regrets that Her Majesty’s Government have not addressed concerns raised by Parliament when proposals for a domestic REACH regime were debated in 2019.
The regret motion is a non-fatal motion. This means that, if it is agreed by the House, the regulations would still come into force.
A series of amendments to the motion to approve the REACH etc. (Amendment etc.) (EU Exit) Regulations 2019 were also moved when the House of Lords debated the regulations on 26 March 2019. During the debate, Lord Whitty (Labour) argued the Government’s approach would result in “excessive bureaucracy and cost”. Responding to this point, Lord Gardiner of Kimble, Parliamentary Under Secretary at the Department for Environment, Food and Rural Affairs, said the Government had “engaged closely with industry stakeholders about costs and how to mitigate them” and that measures such as grandfathering would minimise disruption. The House voted to approve a regret motion by Lord Whitty which criticised the Government’s decision not to maintain the UK’s participation in the ECHA. This regret motion was passed by 214 votes to 202.
- House of Lords European Union Committee, Brexit: Chemical Regulation, HL Paper 215 of session 2017–19, 7 November 2018
- House of Commons Library, Brexit and Chemicals Regulation (REACH), 1 May 2020
- Debate on ‘UK Chemical Industry: Regulatory Divergence’, HC Hansard, 26 February 2020, cols 147–62WH
- Health and Safety Executive, ‘GB-based downstream users or distributors of EU REACH registered chemicals sourced from the EU/EEA or non-qualifying NI good from Northern Ireland who wish to maintain GB market access’, accessed 3 December 2020
Cover image by National Cancer Institute on Unsplash.