Global Processing

European small businesses lack awareness of REACH

January 18, 2013

UK manufacturers' organization EEF is urging European producers to get to grips with REACH, a European Directive banning certain chemicals, warning that if they fail to comply they will face huge fines or even prison. REACH stands for Registration, Evaluation and Authorization of Chemicals and the directive will come into effect on May 31.

According to a recent survey by EEF, one in five European companies believe REACH does not apply to them, whereas almost one in three consider the directive unimportant to their business. However, U.S. companies believe that once the directive is implemented its consequences will be quite serious.

Under REACH, companies will be required to register certain substances produced in or imported to the EU if they amount to at least 100 tons a year. Moreover, a number of substances that have been used in manufacturing for decades are now going to be banned, while the usage of others in certain fields will be gradually restricted, the Environmental Leader reported.

Perhaps unsurprisingly, the awareness of REACH and its implications is better among bigger businesses. The survey reveals that three quarters of large companies and 83 percent of medium-sized businesses were aware of how the directive would affect them and monitored developments regarding the issue. This compares to one in three small businesses with annual turnover below £2 million ($3.2 million) which did not know REACH would affect them. Of those that were aware of the directive, half did nothing to monitor developments, EEF revealed.

According to the survey, many manufacturers shared a misconception that REACH relates to chemical companies only, when in fact it will affect various industries. The directive will regulate the substances used in the manufacturing of cleaning products, clothing and furniture among others. It will require businesses to identify and manage the risk associated with all products containing these substances and applies to all companies that manufacture or market such products in the EU.

Results from the survey also showed that four in five large companies that are aware of REACH are either considering changing the types of substances they use or have already done so. Half of the businesses which know about the directive are changing work practices and altering processes to comply with the new regulation. Some 20 percent of the respondents stated that managing chemicals was a key business priority.

EEF commented that its survey revealed that many companies believed REACH would cost them a lot in terms of money and time, while a significant number of businesses thought the directive was too complex.

The manufacturers' organization is calling on authorities to raise awareness of REACH and its implications, saying that simpler and clearer guidance could ensure better understanding and facilitate compliance. It noted that if there are strong arguments in favor of the continued use of a banned substance, the European Commission might permit its usage. However, if a business is found to be failing to comply it faces penalties such as unlimited fines and up to two years in prison.