Brexit & REACH
There is a lot of uncertainty on what will happen with the UK regulatory landscape after the 29th of March, 2019 when according to article 50 the UK will withdraw from the European Union and the UK will be a “ third party” outside of the EU.
We have received many concerns not only from Downstream Users but also from UK manufacturing companies and UK subsidiaries acting as OR on how the hard BREXIT will affect their business and REACH related investments already done.
With the aim to clarify the uncertainties around the impact of the BREXIT on your REACH compliance and your business, we have developed following Q&A based on the most common concerns received from companies and key stakeholders.
Please note, however, that our answers do not constitute a legal advice and that all information provided is subject to amendment arising from any potential future agreements within UK and the EU.
Our Support Includes
Q: My UK-based company is currently acting as an Only Representative of a non-EU manufacturer. Once the United Kingdom leaves the European Union, how will that affect our status of Only Representative?
A: “The REACH Regulation is very clear in this regard. According to its Article 8, Only Representatives shall be legally established within the EU. After the UK withdrawal, this will mean the territory of the EU-27/EEA. The manufacturer having appointed you as Only Representative will need to involve an Only Representative based in one of the EU-27 Member States or the three EEA Member States, and you will need to change the Only Representative in REACH-IT.
Q: My EU-27-based company is a registrant in a joint submission for which a UK-based company is the Lead Registrant as well as owner of the data to which we have obtained a Letter of Access. What impact will the UK withdrawal from the EU have on our registration?
A: “After the date of the UK withdrawal, the registration by the UK-based company will be considered non-existent. To ensure that you can benefit from a functioning joint submission with a lead registrant, you should ensure that the lead registrant moves to the EU or does a legal entity change to become an EU-27-based Only Representative, or appoint a new lead registrant and transfer the lead registrant role before the date of the UK withdrawal. Agreements among registrants should include a provision regulating the case that the appointed Lead Registrant can no longer exercise their function and foreseeing that the shared information is transferred to a new lead registration, as well as arrangements to ensure data and cost sharing can be continued in the future.”
Q: My UK-based manufacturing company intends to transfer its registration to an Only Representative (OR) within the EU-27. Can we already do this prior to the UK withdrawal from the EU to avoid our registration being voided as non-existent when the withdrawal occurs?
A: “Such a transfer of registration will become acceptable for UK-based manufacturers at the time of the UK withdrawal. According to Article 8 of the REACH Regulation, only a natural or legal person established outside the EU may by mutual agreement appoint [an Only Representative]…As long as the UK is a Member State of the EU, your company therefore will not qualify for performing such a transfer. Consequently, we recommend that you, prior to the UK withdrawal from the EU, set up a contractual agreement to appoint an Only Representative…[that] takes effect on the date when the UK withdrawal from the EU takes effect (30 March 2019, 0000 hours CET, 29 March 2300 hours BST). Your company will need to notify this change in REACH-IT immediately ahead of the UK withdrawal. ECHA will clarify the practical steps that you will need to take, closer to this date.
Q: Can my company, which is a UK-based manufacturer and formulator, transfer its REACH Authorisation (or its Application for Authorisation) to an Only Representative within the EU-27/EEA? How can my company do this prior to the UK withdrawal from the EU to avoid our Authorisation (or application) being voided as non-existent when the UK withdrawal takes effect?
A: Yes, such a transfer will become possible at the time of the UR Withdrawal. However, as long as the UK is still a Member State of the EU and your company is therefore not located in a “third country”, your company will not qualify for performing such a transfer. Consequently, we recommend that prior to the UK withdrawal from the EU you set up a contractual agreement to appoint an Only Representative which contains a suspensive conditional clause stipulating that the appointment takes effect on the date when the UK withdrawal from the EU takes effect. The date and time of the UK withdrawal is foreseen to be 30 March 2019, 0000 hours CET (i.e., 29 March 2019, 2300 hours BST). The Only Representative will need to adhere to all the conditions of use determined by the Authorisation decision, including any specific duties foreseen in the decision for your company. ECHA will clarify the practical steps to take closer to this date.” The Authorisation holder/applicant needs to notify ECHA of the transfer. ECHA will forward the notification to the European Commission.
Q: My EU-27-based company obtains its supplies of a chemical substance from a UK-based importer into the EU. When the UK withdrawal from the EU takes effect, our supplier will become an actor based in a “third country”. If we continue our business relations with our UK-based supplier, would our UK-based supplier be entitled to appoint our company as its Only Representative in the EU-27/EEA and transfer its registration to us, or would we need to register as an importer ourselves?
A: “The latter is the case. You would need to act as an importer of the substance into the EU-27/EEA and submit a new registration. Article 8 of the REACH Regulation only allows manufacturers or producers of articles established outside the EU to appoint an Only Representative. This option will thus not be available to UK-based companies that will have been importers into the EU until the date of the UK withdrawal. Thus, it is not possible to transfer a registration of a UK importer to a newly appointed Only Representative. Non-EU manufacturers of the substance may of course appoint an EU-based Only Representative of the substance. However, such an Only Representative would then need to submit a new registration for the substance.
Q: My UK-based company has successfully registered a substance, and ECHA has provided my company with a registration number. How will the UK withdrawal from the EU affect my registration?
A: “After 30 March 2019, the UK will no longer be a Member State of the EU. Hence, any UK-based registrant can no longer be a registrant. For the purpose of the EU’s REACH Regulation, any registration by such a [UK-based] registrant will therefore be regarded as non-existent, as your company will, after the UK withdrawal, be based in a “third country” outside the EU/EEA. … you will need to either relocate to the EU-27/EEA or to appoint an Only Representative situated within the EU-27/EEA.”
Q: (How) Can registrations be transferred from a UK (lead) registrant or OR to an EU actor?
Our baseline approach:
A: ECHA Q&A form the baseline of our analysis, you cannot go far wrong if you follow them. ECHA will support transfers of registrations from UK at the point of Brexit but not all registrations. UK importers will not be able to appoint ORs. Their EU-27/EEA importers will need to make new importer registrations or alternatively the non-community manufacturer can appoint an OR to make new registrations in the EU-27/EEA.
Q: How can I adapt to changes in business environment resulting from Brexit?
A: Our baseline approach:
HMG has announced that it will ”convert current EU chemicals law, including REACH, into domestic law” and will seek ”associate membership” of ECHA
So, some form of British REACH (or BREACH) is a likely outcome eventually but the legal effects of BREACH outside the EU single market and customs union are uncertain
On the EU side the response has been to state that only ”observer status” is possible in ”exceptional cases” and that ” One cannot solicit, from the outside, mutual recognition of rules and standards, were that to repose only on trust”… It needs “common law, coherent supervision and one legal authority”
Sharing our opinions on the uncertainties that Brexit brings to the chemical industry operating in the EU.
Is a UK Regulation on the way?
https://www.reachlaw.fi/wp-content/uploads/2016/06/Brexit-Article_CW.pdf
Will Brexit mean avoiding the burden of Reach?
https://www.reachlaw.fi/wp-content/uploads/2016/06/Brexit-Article_CW.pdf