A four-part series on compliance with the European Union's REACH (Registration, Evaluation, Authorization and Restriction of Chemicals) regulations in Plastics News began with an article on registration [PN, March 23, Page 6]. The series continued with an article on the identification of substances of very high concern (SVHCs) and authorization [PN, April 20, Page 6] and an article on managing authorizations and restrictions [PN, July 20, Page 6]. This article, the last in the series, focuses on polymer-specific issues.
(Aug. 7, 2009) — Polymers as such are exempt from registration and evaluation requirements under REACH.
However, in the absence of registration by an upstream supplier of monomers and other bound substances (non-stabilizing additives) in a polymer placed on the EU market, Article 6(3) of REACH requires the registration of these substances in the polymer.
This requirement has given rise to several issues which arguably are of greatest concern to [those non-EU producers of polymers who wish to] export to the EU.
Article 6(3) of REACH requires the registration of monomer(s) and other bound substances in a polymer manufactured or imported into the EU, unless the upstream supplier has registered these substances.
In late 2008, the European Chemicals Agency (ECHA) advised polymer manufacturers/ importers to pre-register these substances — even if their supplier had already pre-registered them — indicating that the suppliers' pre-registrations as such were not sufficient to establish the Article 6(3) exception.
ECHA thus adopted a literal interpretation of the regulation, i.e., pre-registration is not the same as registration.
The ECHA interpretation was contrary to the general understanding of industry and even of certain competent authorities in the member states. It certainly gave rise to many duplicate — and probably unnecessary — documents.
The European Commission and ECHA received complaints from companies, industry associations and several non-EU coun- tries indicating that the duplicate pre-registrations imposed an unnecessary administrative burden and additional costs.
It is not yet clear how many polymer producers and importers simply failed to make the necessary duplicate pre-registrations.
Many non-EU producers, whether acting through an only representative or an importer, are likely in this position. If they are now still selling their polymers in the EU, they are in violation of REACH.
The commission confirmed that in case the strict interpretation of the provisions concerned is applied by the enforcement authorities, then the substances concerned cannot be considered as legally placed on the market until full registration has been submitted to ECHA.
For those that did make the duplicate pre-registrations, the next task is to confirm whether and when the upstream supplier will make its registration.
When this is done, the pre-registrant can extract itself from the relevant substance information exchange forums (SIEF) by reason of the exception.
In the meantime, it should notify the SIEF formation facilitator that the pre-registration was merely precautionary and opt for a dormant status under the European Chemical Industry Council's (CEFIC) SIEF participation coding.
[Editor's note: On July 20, the European Commission suspended CEFIC from its voluntary register of lobbyists for eight weeks for failing to accurately report its lobbying costs.]
In January 2008, the European Court of Justice (ECJ) heard Case C-558/07, a reference from the English High Court of Justice concerning REACH coverage of monomers in polymers.
* The applicants' main argument was that only unreacted (unbound) monomers in the polymer should be registered, as they are the only type of monomer that remains in the polymer when placed on the EU market.
* They also claimed that almost all monomers lose their risk properties during polymerization and therefore data on them will not reflect risks associated with the polymer.
* They further argued that EU importers of polymers are obliged to ask upstream for often-sensitive information for purposes of registration, while EU manufacturers do not face this problem and hence, Article 6(3) has discriminatory effects.
The court's advocate general [one of eight such officials who provide legal opinions on cases to the ECJ's 27 judges] delivered her [non-binding] opinion in March 2009 and disagreed with the applicants on all counts.
In this case, the advocate general reverted regularly to the institutions' claim that one of the objectives of REACH is to promote equality of competition between EU manufacturers and importers.
* [The advocate general] confirmed that protection of EU producers against competitive disadvantages is a permissible objective of the EU's legislature.
* She also highlighted that it remains open whether this objective may lead to problems under the World Trade Organization.
* She even acknowledged that a comparison between importers and EU producers “admittedly leads to a conclusion that they are not affected equally,” but concluded that WTO compatibility is not the subject of this EU case.
In our view, this EU case could have given more emphasis to the WTO law issues, thus causing the court to take greater notice of this overarching law. The ECJ judgment is expected by the end of this year.
It is likely that the current exemption of polymers as such may be reconsidered in the next years, thus creating a threat of a requirement for many thousands of additional REACH registrations and evaluation, [as] over 30,000 polymers are estimated to be on the EU market.
Of particular interest is whether non-EU governments [will] take up polymer producers' complaints and pursue these at the WTO.
Law firm Steptoe & Johnson LLP's experience at the WTO indicates that the factual situation may well give rise to viable arguments at the WTO level, notwithstanding the expected outcome of the ECJ litigation.
Searles is a partner in the Brussels office of the law firm Steptoe & Johnson LLP. His practice concentrates on EU and international law, forcusing on trade, competition and environmental law.