Chemicals industry facing Brexit 'cliff edge'

Will Green is news editor of Supply Management
9 November 2018

The UK chemicals industry is “facing a huge cliff edge” due to a lack of Brexit planning, according to Lords.

In a report the House of Lords EU Energy and Environment Sub-Committee said preparations for regulating chemicals after Brexit “are not progressing quickly enough, risking human and environmental health and with potentially severe consequences for the chemicals sector”.

The committee said chemicals are currently overseen by the European Chemicals Agency and the regulation concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH), which involves an EU database of chemicals. However, membership of REACH if the UK is not part of the Single Market is “highly unlikely”.

UK-based chemicals firms, dependent on registration with REACH to work in EU markets, would lose such access unless they transfer registrations to an EU-based company, but this may not be possible before the UK leaves the bloc, said the report.

“A delay to registration carries the risk of a trading hiatus as well as disruption to the many supply chains that rely on access to chemicals produced across the EU,” said the report.

The committee also said it was concerned about the government’s alternative plan to REACH, involving the creation of its own database of chemicals approved for use in the UK. Lords said evidence given to the committee that the government planned to “copy and paste” information from the EU database was “not credible and raises serious legal concerns”.

Lords want the government to “urgently explain” how its independent regulatory regime would work and put forward a “more credible plan” for collecting information on chemicals.

The report said the chemicals industry is the UK’s second biggest manufacturing industry after the food and drink sector with an economic output of £12.7bn. In 2017 61% of exports went to the EU, worth £18bn, and 73% of imports came from the EU.

Lord Robin Teverson, chairman of the committee said: “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.

“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.”

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