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Brexit deal analysis
What does the Trade Agreement say?
The Annex TBT-3 on technical barriers to trade of the EU-UK TCA promotes cooperation between both parties of the Agreement but does not prevent either party from setting their own levels of protection of the environment and human and animal health.
With regard to the classification and labelling of chemicals, the TCA foresees that both the EU and the UK implement the Globally Harmonized System of Classification and Labelling of Chemicals (GHS) of the United Nations and periodically update it based on the revisions published by the UN. Each party shall have the possibility to express its opinion when the responsible authority of the other party intends to classify individual substances in accordance with its respective rules and procedures.
Furthermore, both parties shall also ensure cooperation where appropriate by exchanging non-confidential information (e.g. including cooperation on electronic formats and tools used to store data) within the Trade Specialised Committee on Technical Barriers to Trade set up by the TCA.
How does this compare to what was expected?
From a regulatory perspective, Brexit will have a big impact on the competent authorities and regulations applicable on companies active in the chemical sector. As of 1 January 2021, the EU’s REACH Regulation (Registration, Evaluation, Authorisation and Restriction of Chemicals), which applies to manufacturers and importers of chemical substances, mixtures, and certain articles which contain substances, no longer applies to the UK. The UK has set up its own independent “UK REACH” chemical regulation framework maintaining EU REACH’s aims and principles such as the “no data, no market” principle, the “last resort” principle on animal testing, the access to information for workers, and the precautionary principle.
What are the actions for business?
- Any company manufacturing, selling or distributing chemicals in the UK and the EU will need to comply with the UK and the EU rules separately. In the EU/EEA, UK companies still registered under EU REACH will no longer be able to import chemicals into the EU, unless they have transferred their EU REACH registrations to an EU/EEA-based organisation or are importing under the registrations of these EU/EEA importers. UK manufacturers also have the possibility to appoint an EU/EEA-based “only representative” (OR).
- Business based in Northern Ireland (NI) moving goods to and from the EU can continue to use EU REACH as it will remain part of the EU regulatory system for chemicals.
- Under UK REACH, UK manufacturers and importers must register chemicals that access the GB market and ensure all imported products are covered by a valid UK REACH registration. An EU/EEA chemicals manufacturer importing chemicals into the UK must ensure their importer in GB is registered, or else appoint an OR in the territory to carry out the UK REACH registration. For existing EU REACH registrations held by GB-based businesses, these have been carried across directly into UK REACH, legally “grandfathering” the registrations into the new regime. GB businesses will have to complete this “grandfathering” process by providing basic information to the Health and Safety Executive (HSE) by 30 April 2021 using the UK REACH IT system, Comply with UK REACH. Where a UK company becomes an importer in GB from a UK REACH perspective, it must register the substances with HSE by providing the technical dossier appropriate to the tonnage or hazard classification within 300 days (notification) plus either 2, 4 or 6 years of the end of the transition period. The deadline depends on tonnage and/or hazard profile of substances.
- Companies active in the chemical sector based in either the EU/EEA, or the UK, must now take specific steps to ensure they can continue to manufacture or distribute chemicals, and ensure that where supply chains operate between the EU/EEA and the UK there are now two separate registrations maintained: one with the ECHA and one with the equivalent UK agency, the Health and Safety Executive (HSE).
To discuss specific support with your Brexit preparations based on this latest development contact: Deloitte Brexit Insights.