Industry leaders warn on costs of UK REACH

In a letter to government ministers that has been seen by the Financial Times, 25 industry leaders have called for “a more proportionate, effective and efficient” post-Brexit chemical regulatory regime in the UK. The writers are understood to be from multiple trade associations, including the Chemical Industries Association (CIA), though this has not been confirmed.

They said that current plans would be expensive and detrimental to business and would lead to more animal testing, while making it uneconomic to register some low-volume substances. This is a direct result of the UK losing access to the REACH testing database and thus having to duplicate the compliance effort.

Estimating the costs of compliance with the proposed ‘UK REACH’ system at £1 billion, the signatories said: “Perversely, this cost to industry for compliance for one jurisdiction will be double the £500 million UK companies have already spent over the past decade in complying with EU REACH and its, now, 27 markets.”

“All in all, this will hit UK industry hard across a range of manufacturing sectors, reduce the competitiveness of UK manufacturing and lead to a loss of inward investment, as companies look outside the UK for their manufacturing hubs for Europe … Its impact on jobs will be felt particularly in the North and Midlands, where most of the chemicals industry and reliant manufacturing sector is based.”

Industry is said to want the new UK system to focus on “substances of concern and future UK priorities” and to co-operate with EU regulators, rather than spend time and money developing new data packages “the vast majority of which will never be looked at”.

Ahead of a meeting with industry on 15 February, a government spokesperson said that in developing UK REACH, “we have aimed to keep any changes as simple and straightforward as possible. We have also put in place a range of measures to minimise the burdens and costs for businesses in this process.”

Although the CIA and others welcomed the conclusion of an outline trade deal with the EU ahead of the end of the Brexit transition period, concerns remain. A survey by the British Coatings Federation has found that 50% of members believed the deal would reduce the competitiveness of their UK factories compared with EU competitors and nearly 60% were worried about the impact of UK REACH on raw material prices and availability.

In releasing its end-of-year business survey for 2020 on 29 January, CIA chief executive Steve Elliott said: “ As one of the most highly regulated sectors, our industry’s regulatory framework needs to be in close step with that of our key export markets to enable continued and increasing access.” “Should standards drop - or should there continue to be an approach that does not recognise or efficiently link to the legal standards we met while in the EU, then prohibitive costs will mean investment in the UK will fall, undoing much of our strong performance to date.”