The REACH Authorization Process: From Candidate List to Annex XIV

Chemspec Europe, Barcelona 13 to 14 June 2012 Vanessa Edwards Partner, London K&L Gates LLP

Copyright © 2010 by K&L Gates LLP. All rights reserved.

Process for Including a Substance in Annex XIV

Step 1

Candidate List Currently 73 substances included Target of 136 by the end of 2012

Step 2

Prioritization & Recommendation

Step 3

Annex XIV ‘Authorization List’ Currently 14 substances included 2

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CANDIDATE LIST

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Procedure for Candidate List
Submission of Annex XV dossier
Public consultation
ECHA refers dossier to Member State Committee
MSC secretariat considers comments and provides MSC members with all comments
Identification of the substance as SVHC
Publication of Substances on the Candidate List

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Candidate List
Only substances which are Substances of Very High Concern (SVHC)
http://echa.europa.eu/web/guest/candidate-list-table
Certain substances that may have serious and often irreversible effects on human health and the environment can be identified as SVHCs
Substance of Very High Concern (Article 57):
Carcinogenic; mutagenic; toxic for reproduction;
Persistent, Bioaccumulative and Toxic or very Persistent and very Bioaccumulative;
Equivalent level of concern to those above (e.g., endocrine disrupters). 6

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Consequences of being on the Candidate List
Consequences of being on the Candidate List (‘CL’)
Suppliers must provide sufficient information to allow safe use of the article to their customers on request
Suppliers must provide safety data sheets
Producers or importers must submit notification to ECHA where:
SVHC is present in the articles in quantities totalling over 1 tonne per producer or importer per year;
SVHC is present in the articles above a concentration of 0.1% weight by weight


Business implications for companies 7

PRIORITIZATION

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Priority List: process Annex XIV Substance(s) added with specific sunset dates after which they can no longer be used if Authorization is not granted

ECHA draws up list of possible substances for inclusion in Annex XIV of REACH at least every 2 years

Proposal sent to Member State Committee ‘MSC’

MSC opinion on proposals

Commission takes final decision No minimum time frame set 90 days

ECHA

Public consultation launched on ECHA website

ECHA prepares draft proposal for substances to be included in Annex XIV based on MSC opinion and including Art. 2 exemptions 9

Prioritization / Recommendation
ECHA recommends a list of substances for inclusion in Annex XIV at least every two years
Periodic review of Candidate List prioritises substances that should be subject to authorization
No possibility to challenge
Not “an act intended to produce legal effects”
After consultation recommended substances are added to the list of substances requiring specific authorization for use (‘Annex XIV’) http://echa.europa.eu/web/guest/addressing-chemicals-ofconcern/authorisation/recommendation-for-inclusion-in-the-authorisation-list/previousrecommendations/3rd-recommendation

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Which substances are to be prioritized next? Registry of Intentions
Enables interested parties to be aware of the substances for which the authorities intend to submit Annex XV dossiers
Helps to avoid duplication of work and encourages cooperation between Member States when preparing Annex XV dossiers.
Enables (MSCAs) / the European Chemicals Agency (ECHA) to check if another Authority has in the past worked on an Annex XV dossier for a specific substance or is currently preparing an Annex XV dossier on the substance. 11

AUTHORIZATION

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Annex XIV
Manufacturers, importers or downstream users must apply for authorization before the placing on the market and use of any substance which is listed in Annex XIV of the REACH legislation
Following an application for authorization, ECHA will conduct a public consultation, risk assessment and socioeconomic analysis (to assess the benefits of use against the risks)
Authorization will only be granted for a ‘specific use’
Exporting substances – authorization may not be required
Importing articles which contain SVHCs 13

Exemptions
Substances which fall outside REACH or are not SVHC
Substances subject to REACH but exempt:
General exemptions
Uses of substances under Art 2(5) REACH
Art 2(8)(b) REACH - intermediates
Art 56 exemptions specific for Authorization
Use-specific exemptions
Granted when substance being listed in Annex XIV 14

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Intermediates Specific provisions for intermediates
Specific provisions owing to workability and ‘special nature’
REACH only applies to isolated intermediates
Reduced requirements provided that manufacture is under “strictly controlled conditions” and complies with Arts 17 & 18
As long as its use is intermediate only, it cannot be included on the CL. Definition and controversy over meaning of “isolated intermediate”
ECHA clarification on the concept of intermediates
Industry relied heavily on argument that substance is an intermediate to exempt it from Authorization
If substance has other uses may be listed on CL / Annex XIV 15

Business implications: Annex XIV
Communication up / down the supply chain
Downstream to share information on how the substance will be used
Securing other sources of supply
Pressure to substitute from environmental NGOs and/or consumers
Application for authorization and possible phase-out
Expenses if new data need to be developed

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Engaging with Authorities during process ECHA

Member State

Commission


Industry may comment on submission of Annex XV dossier within 45 days on its website
May comment on ECHA’s draft recommendation
May challenge Commission’s final decision to include substance in Annex XIV published in the OJ
May challenge Commission’s decision to grant or not to grant authorization

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Challenges for Industry
Preparing application for authorization
Consider exemptions
Collaborate with industry in collecting/sharing data
Confidentiality issues
Competition law concerns
Using trustees / analysts


Share the costs?
Decide which uses to apply for

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AUTHORIZATION versus RESTRICTION

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Authorization and Restriction: contrast and compare Authorization
May limit or prevent the placing on the market or use of certain substances
Only substances which meet criteria under Article 57
To ensure that risks from SVHC are controlled and SVHCs ultimately replaced by suitable alternatives
Specific to applicant and use
Only directly affects ‘placing on the market’

Restriction
May limit or prevent the placing

on the market / manufacturing or use of certain substances, including mixtures and articles
Objective to ban or limit manufacture and placing on the market
Restriction results in a complete ban or the setting of specific uses
‘Restricted Substance’ may only be manufactured or placed on the market in compliance with restrictions set out under Annex XVII
Directly affects manufacture of a substance in the EU 20

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CHALLENGING DECISIONS IN THE AUTHORIZATION PROCESS

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Procedural requirement to challenge before the General Court 1. Standing
Legal effects
Regulatory act
Direct concern
Does not entail any implementing measures 2. Grounds for challenge 3. Timing
Applications to the General Court must be lodged within two months of decision being challenged 22

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Challengeable acts 1. Candidate List 2. Annex XIV “Authorization List”


Grounds for challenge:
Lack / misuse of power
Infringement of essential procedural requirement
Infringement of EU law

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Recent challenges
Is the decision a challengeable act?
T-1/10 PPG and SNF v ECHA
MSC’s decision intended to produce legal effects only when updated CL is published on the ECHA website
Is the decision of ‘direct concern’ to the applicant?
T-343/10 Etamine and AB Etiproducts v ECHA and T-346/10 Borax Europe v ECHA
Identification as SVHC contained no new information;
Art 34 imposed no obligations on the applicants;
Arts 7 & 33 inapplicable to the applicants as they were not producers;
applicants failed to prove that their material situation had been affected
Timing of an application?
T-268/10 and SNF v ECHA
Time only runs from 14th day following publication of the decision, where that is an act published in the OJ of the EU. 24

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Challenges: overview
Comply with procedures and deadlines
Identify most appropriate stage of filing an appeal
Candidate List v Annex XIV
Bring industry together
Identify and put forward strongest arguments
Cost v benefit

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Questions? Vanessa Edwards

Partner, London & Brussels K&L Gates LLP [email protected] Tel: + 44 (0)20 7360 8293 Tel: + 32 2 336 1920

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