INSIGHT: US producers renew attack on Reach

11 March 2010 15:50  [Source: ICIS news]

By Joe Kamalick

WASHINGTON (ICIS news)--The US chemicals sector this week renewed its attack on the EU programme for registration, evaluation and authorisation of chemicals (Reach), warning that US adoption of that far-reaching controls system will cripple the industry.

In a hearing before the Senate Subcommittee on Superfund, Toxics and Environmental Health, industry officials and trade groups urged Congress to retain the US risk-based approach to controlling chemicals in commerce.

The subcommittee, part of the Senate Committee on Environment and Public Works, is hearing testimony from various stakeholders on how to modernise the Toxic Substances Control Act (TSCA), which has remained substantially unchanged since enacted in 1976.

Some advocates of TSCA reform want Congress to enact a US version Reach. One of those advocates is Senator Frank Lautenberg (Democrat-New Jersey), chairman of the subcommittee on toxics.

In earlier sessions of Congress, Lautenberg has frequently introduced - but never succeeded in passing - his Kid-Safe Chemicals Act, a bill that many in the chemicals industry regard as a clone of Reach.

Lautenberg has indicated that he will again offer his Kid-Safe bill as starter legislation in the effort to reform and modernise the 34-year-old TSCA.

While there is widespread acceptance and even enthusiasm within the chemicals industry for modernising TSCA, no one among producers wants to see the US abandon the risk-based approach of TSCA in favour of the precautionary principle that underlies Reach.

Charlie Drevna, president of the National Petrochemical & Refiners Association (NPRA), said his group’s 450 member firms support modernisation of the US chemicals risk management system but “NPRA does not believe that a wholesale rewrite of the statute is warranted”.

Drevna and other industry officials told the panel that regulation must ensure public safety without smothering chemical sector innovation and production.

“Effective chemical risk management strives for the balance between doing nothing, which is unacceptable, and zero-risk tolerance - which is not feasible, sustainable or desirable,” Drevna said.

Beth Bosley, managing director for Boron Specialties in Pittsburgh, Pennsylvania, said that “Of course we need protective chemical regulation, but it must be well-informed regulation so that we maximise the improvement in our quality of life and minimize damage to US industry’s competitiveness”.

Speaking for the Society of Chemical Manufacturers and Affiliates (SOCMA), Bosley noted that the US chemicals sector is a global leader in research and development (R&D) and innovation, accounting for nearly 60% of chemical-related patents filed worldwide in the last five years.

Abandoning the risk-based approach embodied in TSCA for the precautionary principle underlying Reach will discourage innovation and divert capital from R&D, she argued.

“Reach is fundamentally flawed in that there was no risk prioritisation prior to commencing the initiative,” Bosley said. She said that the Reach approach to evaluating chemicals in commerce based on volume means that low-risk compounds are screened at the same priority as higher risk substances.

Those arbitrary testing and evaluation requirements burden the EU chemicals sector with costs that will erode profit margins and reduce R&D spending, she said.

“This Reach expenditure must be made without any certainty that risks will be reduced,” Bosley argued. “Consequently, the manufacture and use of certain chemicals will move out of Europe, simply because the costs to stay in the European market are too high.”

Drevna challenged the assertion by Reach advocates that the EU approach will spur innovation in safer chemicals, saying that ten-year-old EU requirements for extensive toxicity and environmental fate testing for new chemicals - without regard for actual consumer exposure - already has inhibited new product development in Europe.

He said that while the EU has seen the introduction of about 2,000 “new and usually safer chemicals” over the past decade, as many as 12,000 new chemistry products have been introduced in the US during the same period.

NPRA also challenged the contention that Reach shifts the onus and cost of chemical safety testing from government to industry.

Reach does increase the regulatory burden on industry, Drevna told the panel, but he argued that it does not reduce the burden on government.

“No government authority is going to receive a chemical dossier from industry and take it at face value,” he said.  “Rather, the government authority will conduct its own risk assessment, based on available information, and render its own decisions, risk-based or not.”

“This will be at least as time-consuming and resource-intensive under Reach as it is under TSCA,” he said, adding: “In fact, it will likely be more time-consuming because EU authorities will have to sift through a plethora of data that they collected, whether that data was needed or not.”

As did Bosley, Drevna argued that the burden placed on industry by a Reach-like regulatory programme will throttle innovation, in part by driving smaller producers - often the innovators - out of business.

“Reach places so much burden on industry that small- and medium-sized chemical manufacturers are facing significant difficulties complying with the programme,” he said.

“For example, the French government recently announced a plan to provide over €600,000 [$800,000] in assistance to help French companies meet the November 2010 Reach registration deadline,” he said.

Drevna cautioned that US adoption of a Reach-like approach to TSCA reform could backfire.

“Pursuit of a programme like Reach, taken on with the best of intentions for human health and safety, could very well impair health and safety by denying critical products entry into the marketplace,” he told the subcommittee.

“Such a programme will place unnecessary burdens on industry that will result in a significantly higher cost of doing business, inhibiting the development of products to enhance our way of life,” he added.

After additional hearings by other committees, a draft TSCA reform bill is likely to be introduced later this year.  Final action on an expanded and modernised chemicals control regulatory system is not expected until sometime next year.

($1 = €0.74)

Discuss the implications of Reach on the Reach Group on ICIS connect
Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy

By: Joe Kamalick
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