European Commission Further Impact Assessment of REACH ETUC Conference Brussels, 11 February 2005 Patrick Hennessy DG Enterprise and Industry.

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Presentation transcript:

European Commission Further Impact Assessment of REACH ETUC Conference Brussels, 11 February 2005 Patrick Hennessy DG Enterprise and Industry

Why REACH? General Public demands better information on chemicals Inadequate chemical testing regime for “old” chemicals and backlog in evaluation Need to maintain single market & establish level playing field in chemicals

Commission Impact Assessment Direct testing and registration costs Wider costs to downstream users Health and environmental benefits Computer-based methods to reduce animal tests Bureaucracy reduced following Internet consultation with 6000 replies

Results of Commission Impact Assessment October 2003 Balance between economic and environmental considerations Direct costs€ 2.3 billion Overall costs:€ 2.8 – 5.2 billion (incl. Direct costs) Effect on innovation:probably positive Overall benefits very difficult to quantify: possible health benefits: € 50 billion.

Stakeholder Workshop in November 2003 Presentation of Commission Impact Assessment and discussion of key issues with the stakeholders (industry, trade unions, environmental NGOs) Three issues identified for further investigation: 1.Supply chain impacts: commercial substance withdrawal 2.Impacts on innovation 3.Impacts on New Member States

Memorandum of Understanding between UNICE/CEFIC and EU Commission March 2004 Objectives: Further specific studies on cost effectiveness Inclusive and transparent process, involving all stakeholders Methodology: Business case study (factual evidence) Critical substances in significant value chain Transparent investigation process and validation Time frame: results by early 2005

Working Procedures under Memorandum of Understanding Working Group Representatives from industry, trade unions (incl. EMCEF), NGOs, and Commission Meets about once a month High-level Group Commissioners, high level representatives of Council, European Parliament, industry, trade unions, and NGOs First meeting in January 2005

UNICE/CEFIC Industry consortium study KPMG Consultants Scope: Commercial substance withdrawal Innovation and business benefits 4 business cases on value chains within: Automotive industry (e.g. vehicle engine) High-Tech Electronics (e.g. Printed Circuit Boards) Inorganics Industry (e.g. steel, cement) Flexible Packaging (e.g. inks, adhesives)

Study on REACH & the New Member States Commission Scientific Service (JRC/IPTS) Sectoral overview and business cases of specialty chemicals industry and downstream users Focus on Poland, Czech Republic, and Estonia Comparable to KPMG study

Study on REACH & SMEs in Textiles Industry Envirotex/CAST for DG Enterprise Special focus on SMEs, both specialist chemical producers and textile mills Impacts on management, legal, technical resources Financing of testing and registration costs Case studies, comparable to KPMG study

Key Issues: Supply chain impacts Size of testing and registration costs relative to future profitability (especially important for lower volumes) The incidence of the commercial withdrawal of substance of critical importance for downstream users Scope for substitution and pass-through Effects on SMEs

Key issues: Innovation impacts Identifying the positive and negative effects: Higher volume thresholds for new substances New R&D provisions Time-to-market effects Production flexibility effects Induced-innovation: due to substitution or commercial withdrawal

Expected Timetable from Now March Finalisation of studies April Presentation to Stakeholder Working Group and High Level Group May Discussion in European Parliament and Council of Ministers

Moving Forward on REACH the View of this Commission No amended proposal before EP’s first Reading Disposition to work closely with EP and Council to arrive at a balanced and workable solution “The Commission stresses the need to arrive at a decision which will be consistent with the Lisbon goals as regards the competitiveness of European industries and encouraging innovation, and which will achieve a marked improvement in health and environment to the benefit of Europe’s citizens” (Lisbon Communication)