REACH What Does It Mean To Me?

1. REACHWhat Does It Mean To Me? A.J. Guikema Tetra Tech

2. Agenda 1. What is REACH? 2. Three REACH Myths 3. Case Study 4. How Does This Impact You?

3. What is REACH ? • Registration, Evaluation and Authorization of Chemicals • New EU Chemicals policy, entered into force July 1, 2007 • Applies to any chemicals (including chemicals in articles) produced or imported in EU • 100,000+ registrations expected; however, registration is only the tip of the iceberg • Many more obligations under REACH (i.e., notification, supply chain communication, classification and labeling (GHS))

4. Registration • For a substance or substance in preparation: • If imported or manufactured in EU in amount > 1 ton/yr, it must be registered • For a substance in an Article, produced, or imported in EU • If substance’s total import and/or production > 1 ton/yr, and • substance is intentionally released under normal or reasonably foreseeable conditions of use it must be registered • Certain exemptions that can be applied • Ref: Articles 6 and 7 of the REACH Regulation

5. Substance of Very High Concern (SVHC) List • These substances are on “death row” • List of substances which are candidates to be banned in the EU • First list will be generated by EU between June 2008 and June 2009 • Will contain approximately 1,000 to 3,000 substances

6. SVHC (continued) • Criteria has already been developed, EU expectation is (correctly) that industry will work out its own lists in advance to determine these substances: • Carcinogenic, Mutagenic, and Reproductive toxins • Persistent, Bioaccumulative, and Toxic • Endocrine Disruptors • Substances of equivalent concern

7. SVHC (continued) • Impact • Anyone doing business in EU must know where these SVHCs are, and in what concentrations they exist • There are both legal reasons and market reasons

8. Notification • For a substance in an Article: • If it is an SVHC and > 0.1% and produced or imported >1 ton/year, and exposure to humans or to the environment cannot be excluded, then substance must be notified to the EU Chemicals Agency • Ref: Article 7.2 of the REACH Regulation

9. Communication • For an SVHC in an Article, concentration > 0.1%, substance must be communicated to recipients and consumers • Information (identity of substance, at a minimum) must be available to consumer within 45 days of any request • Ref: Article 33.1-2 of the REACH Regulation

10. RIP 3.8 Update • Final REACH Implementation Project (RIP) 3.8 Guidance will clarify whether SVHC .1% is per imported article or per homogenous material • European Commission Legal Services opinion is that it is per imported article • Movement to amend REACH to define threshold as per homogenous material

11. Aren’t Articles Importers/Producers Exempt from REACH? • Not a wholesale, blanket exemption • Need to understand products and substances to evaluate and apply exemptions • Burden of proof is on article importer/producer to do evaluation and come up with the right answers, mistakes are costly • Very few substances in articles will require registration, BUT there are many legal obligations besides just registration: authorization, restriction, communication, DU obligations, etc.

12. Doesn’t REACH Only Apply to EU Companies ? • From a legal obligation perspective, this is correct, but market impacts can be more costly than legal impacts • What about your customers in the EU? • What about your EU-based suppliers and product vulnerabilities? • What about sub-tier suppliers based in the EU?

13. Won’t REACH Only Affect Chemicals Companies? • No - In fact, chemicals companies are more prepared for this due to HPV, TSCA, and other past registration activities • Even if this were true, remember that your suppliers are chemicals companies

14. How Does This Impact You? LEGAL OBLIGATIONS • If you have any EU legal entities, you may have direct legal obligations to meet under REACH • Registration • Notification • Supply chain communication • Other legal obligations (i.e., Article 113 classification and labeling requirements)

15. How Does This Impact You? CUSTOMER SUPPORT REQUIREMENTS • If you have no EU legal entities, your customers still require your help, just as they did for ELV/IMDS VULNERABLE SUBSTANCES • In addition, your articles, materials, and substances may be vulnerable due to pending authorizations of SVHCs

16. Do you manufacture, import, or use product in EU? YES You may have legal obligations under REACH NO You may have to support your customers’ REACH data needs Do you sell into supply chain that imports into EU? YES NO Supply of your substances may be vulnerable Do you purchase out of supply chain that exports from EU? YES NO If all answers were no, REACH has no direct impact on you

17. Selling into a Supply Chain Importing into EU You Customer AUS-based Customer BUS-based Customer CBrazil-based Customer DEU-based Customer EJapan-based Customer D requirements will be cascaded down to you via tier one supplier (Customer A).

18. Material ASupplier AUS-based Material BSupplier BChina-based Material CSupplier CEU-based This is an example of purchasing out of supply chain that exports from EU Material D Supplier D US-basedSupplies Direct to You You You have a potentially vulnerable Material, sinceMaterial Cis supplied by an EU-based supplier. You will want to know about substances inMaterial Cand whether they are REACH-compliant. You may have to work viaSupplier Dwho has the direct contractual relationship withSupplier C.

19. Substance Data • Must be communicated globally throughout supply chain • Amount of Substance in your Production Parts/Materials • Amount of Substance in your Process Materials • Annual Production (sales) to each Customer • Which Substances are SVHC? • Issues: • database for data management • confidential information • antitrust concerns

20. Hazard and Risk Data May Be Required • Basic physico-chemical data and general hazard information, may be available from MSDSs • Some substances may require additional data, which may require test results, which may be publicly available or may be determined via modeling or read-across results • Some substances will require full toxicological studies, risk assessments, and exposure scenarios

21. Case Study Cadmium Plating on Bolt in Automobile

22. Imported Article = Automobile • Cadmium is not intentionally released, no need to register • Cadmium is an SVHC, need to collect data from all suppliers of all parts in the automobile and sum the total amount of cadmium • Divide total cadmium by total automobile weight • Cadmium in automobile is almost certainly well below 0.1% • Probably will not need to notify or communicate cadmium, but be aware there are other REACH legal obligations

23. Imported Article = Bolt(Service Part) • Cadmium is not intentionally released, no need to register • Cadmium is an SVHC, need to collect data from all suppliers of all materials in the bolt and sum the total amount of cadmium • Divide total cadmium by total bolt weight • Cadmium on bolt is probably below 0.1% • Might need to notify or communicate cadmium, but also be aware that there are other REACH legal obligations

24. Imported “Article” = Plating on Surface of Bolt • Cadmium is not intentionally released, no need to register if plating is considered an “article.” If plating is considered a preparation, it is possible that cadmium will need to be registered (if more than 1 ton/yr is imported or produced) • Cadmium is an SVHC, need to collect data from supplier of plating material • Determine the concentration of cadmium in the surface coating • Cadmium on surface may be above 0.1% • May need to notify or communicate cadmium, but be aware that there are other REACH legal obligations

25. Summary • REACH is very complex, and some of the interpretations are still being worked out in expert work groups • A variety of legal obligations exist, not just registration - Simplistically assuming you are exempt is often incorrect • If not legally obligated, you may still have a large need for supply chain communication outside of the EU

26. Questions ? aj.guikema@tetratech.com 734.213.4095 www.compliantproducts.com