What impact will REACH have on your strategy?
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REACH, the European Community Regulation on the Registration, Evaluation, Authorization and Restriction of Chemical Substances, is one of the Community’s most complex environmental regulations. Not only does it have huge implications for the producing chemical industry worldwide, but it also has important consequences for companies importing into the EU and professional downstream users. This regulation covers chemical products such as paints and varnishes, as well as substances found in children’s toys, jeans and cosmetics, among other things. Although REACH came into force on 1 June 2007, few companies outside of the chemicals industry are fully aware of its implications.
No data, no market
REACH entails major changes in mindset and ways of working with regard to chemical substances. The regulation states that, in principle, companies must manage the risks of all chemical substances and preparations that they produce in quantities greater than 1 ton, and/or import, process, use or distribute these substances and preparations in the EU. The legal burden of proof has also shifted: whereas the government used to have to prove that a substance was damaging, that responsibility now lies with companies. If they fail to register a substance in good time, they may no longer market that substance or products containing it. No data, no market.
Challenges of REACH
Impact assessments indicate that REACH will lead to cost increases and portfolio rationalization. Companies that offer or process non-registered chemical substances after 2010 may suffer image and reputational damage. Some substances will be withdrawn from the market. REACH’s administrative burden may put an extra 4-20% surcharge on top of the production costs of certain substances. This could very well introduce business continuity risks.
Opportunities for image, continuity and quality
If your company works with substances that must be registered but can avoid this surcharge, you will enjoy a better market. It will be easier to differentiate yourself from your competitors by capitalizing on changes in the market. REACH will also help to drive innovation in corporate social responsibility and sustainable technology.
What PwC can offer you
To embed REACH in your organization, you will need to make a number of important strategic decisions regarding issues such as:
PricewaterhouseCoopers’ experts can help you optimally prepare for and implement REACH. We identify the opportunities for your business (see our flyer, ‘Assessing the business impact of REACH’), help organize your administration, and support the actual implementation. Together with you, we investigate the best solutions with regard to working together in consortia and representation in the registration process (see our flyer, 'REACH Shared Service desk').
PwC’s REACH services aim to derive the full benefits of the new rules and market conditions for your business, managing your threats and opportunities. We identify the specific business issues you face, and support you in addressing and resolving these.
