REACH as business case
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1 REACH as business case Sao Paulo Dr. Thomas Jostmann
2 Talking points Setting the scene Business implications Industry cooperation Major activities under REACH Pre-Registration Registration Authorization/Restriction Role of industry associations Opportunities under REACH Summary and outlook
3 REACH a pean exercise or a global mega trend (1)? Some general remarks: Risk assessment for chemicals is not a new invention of REACH (Biocides Directive, ICCA HPV, US Challenge ), but Shift of burden of proof to evaluate risks from authorities to companies is shift in paradigm Shared responsibilities between manufacturers and users of chemicals changes transparency in supply chain Improved information of downstream users about safe handling of chemicals based on intrinsic properties and exposure information right to know for end users and NGOs is changing companies attitudes towards more transparency to the public regulators to challenge substances of high concern ban of critical substances if safe use cannot be demonstrated
4 REACH a pean exercise or a global mega trend (2)? REACH entered into force in mid 2007 US, Canada and Mexico started the CHAMP initiative China has introduced a REACH-type regulation for new substances UNEP summit on Strategic approach on international chemicals management (SAICM) in 2006 started a global approach for safe management of chemicals So; REACH is not an isolated initiative of pe but has some specifities which are so far unique and may have some immediate business implications!
5 Business implications
6 Get clarity about your own role in REACH Specify your own obligations under REACH: Are you selling substances or preparations in pe? Are you a manufacturer / importer or downstream user? Will you need to register or just provide information about your own use? Do you have all information on hand which are necessary to fullfil your obligations? Do you have an overview about your substances / applications falling under REACH requirements? In case you re a downstream user make sure that your use is taken care of by your supplier, otherwise your product can not be exported to the EU!
7 No registration no market First immediate business impacts: First (easy) hurdle is given by the pre-registration. No Pre-Registration means loss of phase-in Status and by that need to register before entering the market or continuing existing business Pre-Registration will no be followed by registration: Expiration of respective registration period (depending on tonnage band) determines end of marketing within pe. Registration dossier not complete: If missing infomation will not be provided in due time, ECHA can stop marketing of corresponding substance. Specific use is not covered by the registration dossier: Three options: require either separate DU-registration Supplier has to update his dossier Use of substance in this specific application has to be stopped
8 Each Business Step is affected by REACH? Data exchange and communication authorities competitor SIEFS Communication along the value chain customers EU Substance Registrations Data Documents supplier Non-EU Only Representative Starting the communication chain under REACH purchasing Productsafetyt Core processes Production R&D Sales offices Quelle Grafik: Technidata
9 Industry cooperation sharing expertise Registration is team work which requires expertise in different areas and planning of available resources Organisation within the company specify data requirements and gaps collect inhouse information Dialogue within various supply chains identify intended uses collect information about conditions of use Cooperation within consortia evaluate data identify data information gaps May be that in-house resources may not suffice and need to be (re-) activated
10 Is industry prepared to communicate? Chemical suppliers are used to provide information via SDS to their customers but development of exposure scenarios and listing of identified uses needs open dialogue with downstream users! Supplier Formulators Dialogue......increases market transparency...provides market intelligence to potential competitors...discloses confidential business information Downstream users pean transparency is not backed up at global level thus creating an uneven level playing field Is your pean customer prepared to open the books?
11 CBI clarify first before sharing CBI IUCLID 5: proprietary information can be indicated as confidential in the registration dossier (Caviat: fees for each individual CBI) Exchange of important data / information about use patterns o specific applications with customers is based on an SA (Secrecy Agreement) vereinbart. Consortia; in each consortium in with Evonik Degussa is actively participating CBI is covered in the contract (contract examples by Cefic, Redeker)
12 Subgroups within Evonik to prepare for REACH REACH Implementation Working Group (CES, BUs, IT, LE, PR ) REACH Subgroups Communication Pre- Registration Risk evaluation Consortia IT-Tools Datacollection esds Purchasing (Feedstock) Data Sharing DRIP (TeamDoc) Checklists Standarddossier Customer Questionnaire Competitor REACH-Base Substanceidentification CSR Marketing Cost sharing IUCLID 5 Agency contacts Risk Assessment Training Contracts SVT (Substance Volume Tracking)
13 Preparatory steps (1) Cost calculation (1) Pre-Registration (internal costs) - Information gathering (Art. 28) - IT for pre-registration (IUCLID 5-Modul, REACH-IT, own IT-solution) Registration (internal costs) - List of substances, intermediates, on-site, transported, tonnage band - Evaluation of available data, identification of data gaps, costs for necessary studies - Generaton of registration dossier - Generation of esds - Generation of exposure scenario(s) - Generation of CSR (chemical safety report)
14 Registration costs (only direct costs) Cost evaluation by VCI ( 2007) 1 10 t/a ca t/a ca t/a ca > t/a Up to ca. 3 Mio Cost evaluation by KPMG (2005) 1 10 t/a t/a t/a > t/a Cost includes : Tests, Registration dossier incl. internal administration, CSR etc. not included: Waiving, existing data (e.g. for phase-in substances), registration fees
15 Preparatory steps (2) Cost calculation (2) Registration (external costs) - Registration fees ECHA (registration / CBI protection / PPORD / etc.) - Consultant Kosten IT - IUCLID 5, own systems (e.g. SAP EH&S modul, SDS software)
16 Registration fees: new (1) Tonnage band Full base fee Joint Submission Medium sized (single) Medium sized (joint) 1 10 t t t 1000 t > 1000 t Version 10/
17 Registration fees: new (2) Tonnage band Small sized Small sized (joint) Micro sized (single) Micro sized (joint) 1 10 t t t 1000 t > 1000 t Stand: 10/
18 Get in touch with your supplier Check your supplier situation in order to prepare for any changes which may occur in the course of REACH registration Supplier questionnaire Will you pre-register the substance you re supplying? Will you register the substance and if yes- when? What are the specific use patterns Can you describe the exposure situation during application (Scenario)
19 Risk Communication Process flow Manufacturer/ Importer Data CSA CSR ES/UEC ECHA Identified use Formulator I Check ES/UEC Identified use Formulator II Check ES/UEC Identified use Downstream user Check ES/UEC
20 Substances of very high concern will need special treatment Check the toxicological or ecotoxicological properties of your substance: CMRs class 1 & 2 are already today not allowed for end use products. Under REACH is will be necessary to apply for an authorization to cover the use in industrial applications PBTs and vpvbs are under severe scrutiny by pean regulators and may dissapear from the market in the midterm run. Sensitizers are going to be subject for authorization, criteria not yet clear Endicrine disrupters are in the focus All substances which have such intinsic properties will qualify for authorization, which may be given under certain restrictions and timely limitations
21 A list of substances which will disappear from the market midterm First list of candidates for authorization has been published by ECHA: Update every two years Anthracene 4,4'- Diaminodiphenylmethane Dibutyl phthalate Cyclododecane Cobalt dichloride Diarsenic pentaoxide Diarsenic trioxide Sodium dichromate, dihydrate 5-tert-butyl-2,4,6-trinitro-m-xylene (musk xylene) Bis (2-ethyl(hexyl)phthalate) (DEHP) Hexabromocyclododecane (HBCDD) Alkanes, C10-13, chloro (Short Chain Chlorinated Paraffins) Bis(tributyltin)oxide Lead hydrogen arsenate Triethyl arsenate Benzyl butyl phthalate
22 Pre-Registration
23 Pre-Registration (1) Aim: Overview about all relevant substances, possible data sharing and avoidance of unnecessary animal testing, formation of SIEFs, Pre-registration (and registration) required for each legal entity Just one submission number and one pre-registration number per combination substance / legal entity When?: 1. June December 2008 (only limited possibility to extend this period) Who is affected?: Manufacturers and importers How to do it?: XML-File based on own IT tools, via REACH-IT (online), via IUCLID 5 Actual Problems: Bulk upload not yet available
24 Pre-Registration (2) List I: Agency publishes substance list on 1. January 2009 Substance names, CAS-/EINECS-No./intended registration period List II: Only for manufacturers and importers Name of Manufacturer/Importer, Adress (-> for SIEF) Important impact of pre-registration: If manufacturer / importer does not pre-register his substance in due time, production / import has to be stopped immediately after expiration of preregistration period Substance becomes Non-Phase-in-Substance! Phase-in-Substance (Art.20): Substance is listed in EINECS Substance produced in the EU but not marketed within the last 15 years (e.g. intermediates, R&D, Export) NLP: definition has been changed (limited to period , Art 3, 20c) Monomers in polymers Non-Phase-in-substance: new substance
25 Pre-Registration (3) REACH-IT Workflow-System of ECHA called REACH-IT with some shortcomings - Launched on 1 st June Not all functionalities available (e.g.no bulk-upload). Planned availability early July - manual online-pre-registration of substances is possible - PPORD and Early-Bird-Registrations actually only per /cd-rom - Disconnect in Messaging system : Informations via mail-box of REACH-IT will not be passed on to own mailing systems. - Invoices for registration fees of ECHA cannot be downloaded from REACH-IT (one exemption: Firefox) -> associations are in permanent contact with ECHA to solve problems in due time.
26 Pre-Registration (4) REACH-IT Actual situation in REACH-IT ( ) 1851 legal entities registered 170 Third Party Representatives (TPR) nominated 9555 Pre-registrations already sucessfully done (2% with mistakes) 169 PPORD (but: no template available so far) 43 Inquiries 5 Full-Registrations (but: very often without any standardized templates) 18 Registrations for intermediates (template problems) 16 Proposals for SVHC from member states
27 What to do right now? Time is running fast if not already done it is now high time to prepare for pre-registation. 5 months left to safe your business in pe! Actions to prepare for pre-registrations: describe / define substance identity prepare inventory check feedstock (e.g. ingredients in prep s) decide strategically what to pre-register who is the registrant in your company
28 What to do right now (2)? Actions to prepare for registration Organisational setup defined (e.g. project structure) Resource planning with additional staff (internal / external) Data gap analysis cost estimation for additional tests Collection of use information start communication with customers about exposure Consortia strategy resource management strategic management process Plan B for SVHC portfolio management
29 Registration mechanisms
30 Process of risk assessment Identification and and description of of use: use: Registrants Registrantsown ownuse use Downstream Downstreamuses uses Entire Entirelife life cycle cycle (incl. (incl. articles articles & waste) waste) based basedon on descriptor descriptorsystem system CSA CSA iteration iteration improve improvehazard hazardinformation improve improveexposure exposureinformation higher highertier tiermodels substitute substitutemodel modelby by measurement measurement Exposure scenario Exposure Exposuredeterminants Generic Genericvs. vs. Specific SpecificES ES ES ES for forpreparations preparationsand and articles articles Derive DeriveDNELs DNELsand and PNECs PNECs DNEL= derived no effect level PNEC= predicted no effect concentration Safe use Use adviced against Exposure estimation measured measureddata data (per (per exposure exposure route) route) modelling modelling Occupational Occupational health health Environmental Environmental exposure exposure Comsumer Comsumer exposure exposure Man Man indirect indirect via via environment environment
31 Risk evaluation There is no golden assessment tool available to evaluate all kinds of exposure; existing tools are Occ. Occ. Exposure Exposure ECETOC ECETOC TRA TRA COSHH/BAuA COSHH/BAuA Cons. Cons. Exposure Exposure ConsExpo ConsExpo EUSES EUSES ECETOC ECETOC TRA TRA Env. Env. Exposure Exposure EUSES EUSES A/B A/B tables tables and have.. preset scenarios conservative default values limited variability (e.g. in exposure determinants, risk management measures) complex input structure need work-around expertise Without any experience in exposure modelling and basic know-how in risk assessment it will become difficult to judge the validity of the modelling results
32 Only Representative
33 Only representative (OR) Manufacturers outside of the EU may nominate a Only Representative who can take over all duties for a foreign company not being located within the EU- Caution: Definition of OR has been changed Change from one OR to another is now possible! Update of ECHA. Important: The previous OR must agree to this change (fix in contract!), otherwise a new Dossier required! Tonnages of numerous companies of one OR will not be accumulated, but the OR has to provide a separate Dossier for each registrant. The OR can cover imports of a Non-EU-Manufacturer, even if the substance has been traded outside of the EU
34 Only representative (OR) (2) The OR will have to take over all activities within the cooperation between companies SIEF: Definition of sameness of the substance Negotiation with competitors about scope and structure of SIEF Data evaluation of own and external data agreement on cost sharing mechanisms and own contribution Confidentiality agreements to protect CBI Consortia cooperation Contractual issues Sweat equity contribution Administrative burden sharing Agreement on joint and separate activities Preparation of registration dossier Information about use and exposure
35 Role of associations
36 SIEF-Information exchange forum Facilitation of inter-company interaction to find cooperation partners Cefic, VCI, UIC, CIA, FEIQUE and Federchimica have cooperated to form a SIEF-Portal System should be ready for use in July (Release 1.0) Company owning this system is named REACHLink, the system itself SIEFreach. It is compatible with pre-registration functionality of REACH-IT. Costs for user of this system: one-time payment of per LE/Substance/user For invited experts: For data holder: Early birds can gain fee reduction of 10% (registration to the system before 31. July) Contact: Jack Wille, JWE@Cefic.be or Alain Renard, ARE@cefic.be
37 Preparation of standard tools Evaluation of exposure situation in many standard application is the most demanding part in CSA generation. Many downstream associations have started to work on their standard exposure scenarios (e.g. detergents, paints, adhesives, ) ECETOC is actually refining its tiered risk assessment tool to simplify risk evaluation Business pe is currently developing a standard phrase catalogue to facilitate esds generation and standardized communication along the value chain Cefic is updating a risk management measures (RMM) library to provide assistence in RMM evaluation and communication DU associations prepare calculation tools to enable their membership to evaluate diverging exposure situations
38 Opportunities under REACH A REACH registration is a licence to do business in pe Customers may ask for covering their specific use in the registration dossier (=selling point) Dialogue with customers and downstream users will provide better inside view about potential product advantages (=customer intimacy) Conducting special risk assessments for your customer can ensure exclusivity (=customer bonding) Low margin products may be taken off the market (=reduction of complexity) Screening of SVHC can open business opportunities
39 Summary If you re doing business in pe you better check your obligations under REACH Importers do have the same obligations as pean manufacturers Expertise is necessary to conduct a risk assessment strive for alliances Missing deadlines for pre-/registration means loss of business Your customer will need supply security in order to secure his own business Manage your own resources (financial & human) to avoid shortages there are no experts anymore on the free market
40 KONTAKT
41 Generation of esds Substance on the market Ja SDB erforderlich (ohne Annex) No Stoff erfüllt die Einstufungskriterien nach Art und Art 31.3 Yes < 10 jato (zum Zeitpunkt der Registrierung) Nein kein SDB erforderlich (mögliche Anwendung Art. 32 prüfen) Ja Generisches ES (GES (Option) Generisches Vorgehen möglich? Nein Nein Substances of very high concern (Art 57 Kriterien) Ja Sektorspezifisches ES (Option) SDB mit Annex detailliertes ES (Option)
42 IT Project REACH-Base (Evonik) Registration Pre-registrations Bulk-upload aktually not possile 250 pre-registrations ready (online) 50 Legal entities REACH Base Pre-Registration Evaluations (e.g., Excel, Access, Web) Registration Substances - Substance name, LE - Registration data IUCLID5 Management Data - Substance checklists - Endpoint status - Endpoint costs Add on Substance Registration Decisions - Substance name, LE - Decision data (generally, not in IUCLID 5) - Cost planning Add on Preregistration substances -Substance name, LE - Little data Add on IUCLID5 Front End Front End (Access, Web)
43 Extended REACH Projekt ( ) Projektorganisation REACH Implementation Working Group Representatives of Business Units (product safety), IT, LE, PR Subgroups (SG) SG1: Vorregistrierung Steering committee Blauth, Dr. Jostmann, Dr. Rettig, Hetzke Project team Dr. Wiegand, Dr. Soballa, Dr. Lutz, Rößler SG2: Bewertung SG3: Kommunikation SG4: Konsortien SG5: IT-Tools REACH Assurance Program Project team - Competence center - Best Practice - SPC (Single Point of Contact) - OFA (One Face to Agency) - internal training - Master IUCLID5 (IT-Tool for Registration) - Quality check - Proof reading BUs
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