Chemical Supply Chain

Copyright © 2008 REACHLAW Ltd. All rights reserved.

What Supply Chain Managers need to do to meet effectively comply with REACH ?

Philip Capel, European Sales Director REACHLaw Ltd

Topics to be covered

� Introductions

� Current status of REACH

� The role of supply chain in REACH and key responsibilities

� Alternative strategies

� Future of REACH and impact on supply chain

� Conclusions & summary

REACHLaw’s mission

REACHLaw Ltd

exists exclusively to provide full set of REACH services and timely solutions to its clients

by

offering unique combination of expertise in REACH, legal, chemistry, environmental and business

Key capabilities of REACHLaw:

Industry knowledge, Legal REACH knowledge, Chemistry,

Close Cooperation with ECHA and Helsinki REACH Centre, Independence

REACHLaw Ltd today : World class REACH service provider

Our customers: > 200 major manufacturers in more than 30 countries with 2500+ substances

Customers

Partners


� Introductions






� REACH is the new chemical legislation in the EU

affecting the sale and manufacture of all

chemicals unless specifically exempted

� REACH (and CLP) are in force NOW!

� No registration – no EU market

What is REACH?

CLP: Classification, labelling and packaging

REACH is complex

� REACH text is 849 pages

� Difficult to understand

� New and unclear definitions

� IT tools are still under development

� Processes are unclear

� Responsibilities unclear (Commission, National, ECHA, Enforcement)

� Guidances more than 20.000 pages (still in development)

Failure to comply may lead to halt of production and eventuel criminal penalties

For a company it is an exercise in knowledge management

Supply Chain vs REACH

Supply chain manager

� Raw materials, Products, SKU,s

� INCOTERMS,

� Distributors, Customers, Suppliers, Formulators, toll-manufacturers, warehousing

REACH

� Substances, Mixtures, Articles

� POM (place on the market)

� Manufacturer, Importer, Downstream User (OR)

Different Actors in the REACH Supply Chain

“Only representatives” established in the EU and appointed by a manufacturer, formulator or article producer established outside the EU to fulfil the registration obligations of importers

ECHA Statistics : pre-registrations

� Total number of pre-registrations

� 2,750,000 pre-registrations

� 65,000 companies signed up in REACH-IT

� 146,000 different substances pre-registered

� Volume about 15 x expected by ECHA

� Number of pre-registrations to be safe ?

� Non-EU pre-registrations ?

� Importers ?

� Our conclusion: Far fewer ”real” registrants involved as the work really gets going

Some implications

ECHA 9.000(HPV,

CMR’s etc)

55.000

substances with

2010 deadline

2.300substances with Lead Registrant

6.700substances where

LR needed

0-46.000 (?)wrong pre-

registrations

0-46.000 (?)substances which

will disappear

How to get the work done,

costs ?

How to get the work started ?

Which ones ?

Replacement

of substances, change of

processes ?

Original estimate Pre-registration Current status Key concerns

Key concern : Current (=real) status of REACH work, outcome 2010 ?

Availability of chemicalsSubstances not covered currently� 2010 deadline, no progress yet

� A huge risk: no registration

� Only solution: Industry must take the responsibility and some major manufacturer must show up as Lead Registrant, otherwise no registration


� Introductions






Fig. 2: REACH & CLP: Main issues for sourcing and delivery

Non-EEA EEA

Manufacturer

Distributor

Formulator

Article supplier

OR

Manufacturer

Your company

Supplier

Consumer

Final professional user

Distributor

EE

A s

upply

chain

FormulatorSourcing

Delivery

Main issues for sourcing:• availability of raw materials?• coverage by upstream registrations?• REACH-SDS and CLP-labels?• risk of non-compliance mitigated?

Main issues for delivery:• REACH-SDS and CLP-labels?• exposure scenarios for customer uses?• risk of non-compliance mitigated?• Article 33 SVHC communication

REACH and CLP (Classification Labelling and Packaging)

REACH

� All chemical substances must be registered by manufacturer or importer

unless exempted

� Requires an extensive technical dossier including tox/ ecotox data and uses

� Only applies to volumes above 1 ton per year

CLP

� Derived from the GHS UN to be implemented in EU

� Requires notification of hazard classification and labelling by manufacturer

and importer

� Re-labelling, re-packaging by suppliers of hazardous substances and

mixtures

� Applies to all substances and mixtures regardless of volume (very limited

exemptions)

Supply Chain Communication REACHRole & Responsibilities

Registrants duty of communication

� As a part of Registration Dossier collect info on uses

� Provide SDS to customer

Downstream Users

� Communicate new info on hazardous properties

� Duty to identify apply & use recommend RMM

� Report info to ECHA

Distributors

� To pass the info on next actor in supply chain

Article suppliers

� Info on SVHC in articles acc to Art.33

Main REACH & CLP tasks in the supply chain for 2010 / early 2011 (simplified)

¹ Existing (‘phase-in’) substances ≥1,000 tonnes, R 50/53 ≥100 tonnes and CMR cat.1 or 2 ≥ 1 tonne per year² If supplied downstream in EEA

What

& when

Who

REACH Registration

30.11.2010 ¹

CLP Notification

3.1.2011-

CLP Classification,

Labeling & Packaging ²

(for substances)

1.12.2010-

REACH compliant SDS ²

Continuous

REACH

Restrictions

Continuous

REACH Candidate List

for Authorization

Continuous

Manufacturer /

importer of

substances (on their

own or in mixtures)

Required

unless only

representative does for

importer

Required

unless only

representative registers

beforehand incl. CLP

Required Required

For dangerous

substances and mixtures

Required Mainly ’early warning

system’ (consider phase-

out of substance)

Downstream user

of substances (e.g.

formulators and other

professional users)

Not required

but check if registration

covers your use and –

if not - check obligation

to prepare CSR

Not required Required

but take over supplier’s

classification if

unmodified

Required

For dangerous




out of substance)

Distributor (incl.

retailer)

Not required

but check if registered

Not required Required

but take over supplier’s

classification

Required

For dangerous




out of substance)

Article producer /

importer / supplier

Not required

but check exception for

articles with substances

subject to REACH Art.7

Not required


imported articles with

substances subject to

REACH Art.7

Not required


articles with substances

subject to REACH Art.7

and explosive articles

Not required Required REACH Article 33

communication²; SVHC

notification as of

1.6.2011; consider

phase-out of substance

Main tasks as an importer/ manufacturer

� Registration (substances on their own or in mixtures): Has

your non-EU supplier appointed an OR,

� Compliance with restrictions

� CLP by 1.12.2010 for substances

� C&L notification (unless supplier-OR has registered using CLP) first deadline: 3 January 2011

� REACH-compliant SDS update required to include CLP classification & labeling starting 1.12.2010

� Outlook: Authorisation, substance will be permanently under inspection, creates a strong pressure to substitute

Main tasks as distributor

� Check if your supplier is going to register


� REACH-compliant SDS

Main tasks as article producer/importer/supplier

� Check if your supplier is going to register

� Main issue: Article 33 have a system in place to

track SVHC and communicate downstream


� Check registration and notification obligation acc.

to REACH Article 7

Key concerns – grouping of issues

� Supply chain management concerns

1. Availability of chemicals after 2010 (sourcing) 1. Substances not covered currently by REACH work,?

2. Certain Uses not covered according to ECHA Use Discriptor System

3. Current (real) status of REACH work, outcome 2010

2. Other new regulations, obligations for supply chain (delivery side)

3. Structural changes in the market (both sourcing and delivery)

4. Need of internal process updates (both sourcing and delivery)

� Technical concerns in supply chain

1. CLP and REACH: how implement at same time ?

2. Need of updating IT support ?

Structural changes in the market ?

Solution ?

You must survive regulations…

or ???

EU importer – registration necessary Announcement from Shell:


� Introductions






Availability of chemicals ?Impacts ?� What will happen with substances, which will not be

registered on time ?

� No manufacture ?

� No import ?

� Enforcement ?

� By local authorities ?

� Different approaches ?

� ”Unequal markets ” ?

REACH is about StrategyPreregistration

� Phase in status important

� Future development substances

� Future importer status

� Operations : future production decision

Registration

� Which consortia to join?

� Do you want to have a leader position?

� Do you need to take a leader position?

Rethinking your supply chain

� Buying EU vs non EU

� Discontinuing products

� Reformulation products

� Excluding applications

Imported substances from non-EU countries - Background

� Many importers have made pre-registrations for

substances they import from non-EU countries

� Note: Many EU manufacturers act also as importers when they buy raw materials for their

own manufacture

� To register or not ?

� Business decision based on several issues

� Cost, benefit for your business, independence

Imported substances from non-EU countries - alternatives

� If you register, in most case you will be ”Regular

Registrant

� Especially if you are ”true” importer

� REACHLaw Registration Services available

� If you don’t register you need to know if your

suppliers are REACH-compliant

� REACHLaw Supply Chain Audit Services


� Introductions






Substance Volume Tracking

Need of changes in internal processes

� On sourcing side:

� ”Compliance certificate”

� Agreements:

� On delivery side:

� Information in supply chain

� Agreements

� ….

Substance Inventory Managment System SIMS

� Identification & monitoring

� Substance volume tracking upstream &

downstream

� Internal use mapping

� Supply chain communication

� Creation of notification documents

Substance Inventory Managment System SIMS (only IT can manage it)

Substance Inventory Managment System SIMS

� Interface between ERP & EH&S

� Electronic eSDS system

� Interface with IUCLID5

� ..

REACH SVHC in articles managementindentification & downstream communication

� Requirements for substances in Articles

� SVHC in Article screening

� SVHC Communication in the supply chain

� SVHC Candidate list proposals

Substance first re-classified as hazardous and then identified as SVHC – What is the potential impact on your EU customer?

Health and Safety signs at

work Directive 1992/58/EC

Seveso II Directive96/82/EC

Detergents

Directive648/2004

CosmeticProducts

Directive76/768/EEC

REACH Regulation1907/2006

Biocidal Products

Directive 98/8/EC

Ecolabel Award

scheme 1980/2000

Young people at work Directive

1994/33/EC

Biological

agents at work Directive

2000/54/ECAerosolDispensers

Directive 75/324/EEC

EOL vehiclesDirective

2000/53/EC

Export / import

Regulation 689/2008

Pregnant and

breastfeedingwomen at work

1992/58/EEC

VOCD

Directives 1999/13/EC

& 2004/42/EC

IPPC Directive 2008/1/EC

DSD / DPD

Directive 67/548/EEC &

1999/45/EC

ChemicalsAgents Directive

1998/24/EC

Hazardous waste Directive

91/689/EC

Plant protection

Products Directive

91/414/EEC

Ambient air

Directive 1996/62/EC

Batteries Directive

91/157/EEC

RoHS Directive

2002/95/EC

WEEE Directive

2002/96/EC

Water Framework

Directive 2000/60/EC

General Product Safety Directive

2001/95/EC

CLP Regulation

1272/2008/EC

Ozone depleting substances

Regulation (EC)

No 2037/2000

EcolabelRegulation

66/2010

Protection of mothers

Directive 92/85/EEC PPE

Directive 89/686/EEC

Waste Framework

Directive 2006/12/EC &

2008/98/EC

EU indicative occupational

exposure limit

values Directive 2000/39/EC

Exposure to carcinogens and

mutagens at work 2004/37/EC

Other new regulations ?

How to utilize REACH work and experiences

� REACH goes global !!!

� Turkey

� Japan

� Others

Other new regulations ?

� Solution: Global Regulatory Monitoring

� Amendments to REACH and CLP Regulation

� REACHLaw will report the latest amendments to the REACH and CLP regulation with an explanation and of the possible business effect if any.

� SVHC monitoring service

� Authorization and Restriction processes

� Enforcement of REACH

� REACHLaw will report on the REACH Implementation projects initiated by the Forum and provide information on Forum meetings, resolutions and actions taken.


� Introductions






REACH (and CLP) go global – using registration to meet other regulatory requirements

� We have not seen the real impact of REACH yet !

� New regulations coming, affect….

� .......

Top key concerns – Conclusions

� Supply chain management concerns

1. Availability of chemicals after 2010 (sourcing)

2. Other new regulations, obligations for supply chain (delivery side)

3. Structural changes in the market (both sourcing and delivery)

4. Need of internal process updates (both sourcing and delivery)

� Technical concerns in supply chain

1. CLP and REACH: how implement at same time ?

2. Need of updating IT tools ?

Questions ?

� Thank You !

Education

Chemical Supply Chain