Bridges Trade BioRes • Volume 4 • Number 13 • 8th July 2004

EC CHEMICALS REGULATION DRAWS RENEWED CRITICISM AT WTO

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EC CHEMICALS REGULATION DRAWS RENEWED CRITICISM AT WTO

At a 1 July meeting of the WTO Committee on Technical Barriers to Trade (TBT), the US, Japan and other EC trading partners reiterated their criticism against the proposed European chemicals policy REACH (Registration, Evaluation, Authorisation and Restrictions of Chemicals), saying the legislation would be too costly and burdensome and would disrupt global trade. Meanwhile, civil society groups renewed their calls for strengthening the chemicals policy, calling on the EC to resist the "US government’s efforts to weaken" the legislation.

In a 51-point document submitted to the TBT Council, the US elaborated on its concerns, already expressed at previous TBT meetings (see BRIDGES Trade BioRes, 11 July 2003). Specifically, the US noted that the EC’s latest proposal, released in October 2003 (see BRIDGES Trade BioRes, 31 October 2003), "still appears to adopt a particularly costly, burdensome and complex approach" that could "prove unworkable in its implementation, disrupt global trade, and adversely impact innovation". The US feared that the current proposal might affect the majority of US goods exported to EC — worth over US$150 billion in 2003 — given that chemicals are used in the production of most manufactured goods. The US added that the impact likely would be even greater following the recent accession of the 25 new EC member states, and called on the EC to improve the regulations’ cost-effectiveness so as to minimise negative trade impacts.

Several Asian countries, including, China, Chinese Taipei, Japan, Thailand and Singapore on behalf of the Association of South East Asian Nations (ASEAN) also voiced concerns. The countries pointed to the expected economic impact on developing countries, in particular on small and medium sized enterprises, which they said would be unable to cope with the complex, burdensome and costly system. Moreover, they criticised the scope of obligations under the new policy as going beyond other countries’ chemical management regulations. China complained that the EC had not carried out an adequate assessment of impacts on the chemicals industry in poor countries. The EC said it would respond to the comments in writing. Japan warned that the policy might be inconsistent with WTO rules, as it may end up restricting Japanese exports to EC countries.

Civil society groups, on the other hand, renewed their calls on the US to cease its "campaign to weaken the EU chemicals policy". "Rather than attacking the REACH policy, the administration should emulate it to safeguard US consumers from the tens of thousands of unregulated, potentially dangerous chemicals on the market," said Lori Wallach, Director of Public Citizen’s Global Trade Watch. The TransAtlantic Consumer Dialogue — a coalition of more than 60 consumer groups in Europe and the US — urged the EC to strengthen the proposed policy. Among their recommendations, they demanded that hazardous chemicals not be subject to volume thresholds for registration and authorisation; that the authorisation procedure for chemicals of igh concern should be strengthened, including through a strong substitution test; and that all consumer articles containing chemicals — domestic and imported — should be assessed, whether the chemicals were intended to be released or not.

Certain members of the US Senate also brought forth concerns. In a letter to US Trade Representative Robert Zoellick, Frank Lautenberg (D-NJ) and Jim Jeffords (I-VT) raised questions with regard to the US government’s position on the potential trade implications of the EC’s proposal. "We are troubled by reports that the position of this administration on REACH may reflect the interests of a narrow segment of US industry without consideration of the broader ramifications for the US economy, national interest, public health and the environment," they noted. The senators requested Zoellick to specify which provisions of REACH he considered to be in conflict with which WTO provisions. They also called on Zoellick to explain how he had arrived at his position on REACH and who he had consulted in the process.

Background

The REACH legislation is set to replace 40 different pieces of current legislation in the EC. Among the most fundamental changes is a proposed shift of the burden of proof for the safety of chemicals from public authorities to companies that produce, import and use chemicals. A new European Chemicals Agency would administer the legislation. Registration and approval procedures would vary depending on the amount of chemicals manufactured or imported, and on the level of risk. While the vast majority of chemicals would only need to be registered, authorisation would be required for substances of "very high concern," such as carcinogens, mutagens and reproductive toxicants, subject to a risk assessment. To obtain authorisation for a specific use, the applicant would have to show that the risk from the use was adequately controlled or that socio-economic benefits outweighed the risks.

ICTSD reporting; "Washington works to weaken European chemicals policy at WTO," ENS, 24 June 2004; "Consumer groups call on US to cease campaign to weaken EU chemicals policy," TACD, 23 June 2004; "U.S., Japan voice concern on EU draft rules on chemicals," KYODO NEWS, 5 July 2004.