Post-Brexit chemical regulation plans 'not progressing fast enough'

The chemicals sector is the UK's second biggest manufacturing industry, and exported £18 billion worth of products to the EU last year. However, these companies could be in danger of losing EU market access if they do not take pre-emptive action to maintain valid registrations in the EU; something for which time is running out, according to a new report by the House of Lords EU select committee.

The UK chemicals sector is currently regulated by the EU's registration, evaluation, authorisation and restriction (REACH) regime. The rules combine legislation with an EU database and EU regulator, and require EU companies to register chemicals before placing them on the EU market. The rules also require companies based outside of the European Economic Area (EEA) to engage an EEA-based importer or procure the services of an 'only representative' to serve as an agent in order to import chemicals to the EU.

The government's current position is to seek associate membership of and ongoing participation in the European Chemicals Agency after Brexit, giving it continued access to the REACH database and ensuring that products need only go through one approval mechanism to access both the UK and EU markets. Its 'no deal' position is to create its own database of chemicals approved for use in the UK, based on the REACH system and regulated by the Health and Safety Executive.

However, the committee said that the UK's continued participation in the REACH system was looking increasingly unlikely, given its position on remaining within the EU single market. Its alternative plans, which in the words of one minister include "copy and past[ing]" information from the EU's database, are "not credible" and "raise serious legal concerns".

"Chemical regulation might seem like a niche area of Brexit considerations, but chemicals are used to make products that we all use every day, and the chemical sector is key to the UK's economy," said Lord Teverson, the Liberal Democrat peer who chairs the committee.

"Although we welcome the government's aim to remain part of the REACH system after Brexit, its negotiation red line on the UK's membership of the single market makes that highly unlikely. That means it urgently needs to be working on a Plan B, and that simply hasn't happened, which leaves the sector facing a huge cliff-edge on the day we leave the EU," he said.

According to the committee, the government must urgently explain how its independent regulatory regime would work and clarify which UK agency will take on the role of chemical regulation. The government must also put forward a more credible plan for collecting information on chemicals, and take steps to enable UK chemical businesses to maintain their access to the EU market ahead of exit day.

Brexit specialist Guy Lougher of Pinsent Masons, the law firm behind Out-Law.com, said previously that the government's 'no deal' guidance on chemical regulation was "one of the starker documents" that it had issued to date.

The government warned in the paper that a 'no deal' scenario would restrict UK-based chemical companies' access to the EU market, while UK-based importers of EEA chemicals would face new registration and authorisation requirements.