E.U. Parliamentary Comittee Approves New Chemical Regulations

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Washington, D.C., October 12, 2006—U.S. and European firms were unsuccessful in an attempt to make the proposed European policy on chemical regulation more affordable during recent committee consideration of the bill in the EU Parliament.  “Even if business had succeeded in reducing paperwork costs, the policy would still have adverse effects around the world,” noted Angela Logomasini, the Competitive Enterprise Institute’s director of risk and environmental policy and author of a study on the topic published by the Brussels-based Hayek Institute.

The program, known as REACH—for the Registration, Evaluation and Authorization of Chemicals—would require companies to register more than 30,000 chemicals, the vast majority of which are already on the market. Some chemicals would also have to undergo an evaluation and authorization processes, which can lead to bans and other restrictions.

This week, the Parliament’s environment committee approved the legislation after rejecting industry attempts to allow companies to use data they produced for similar regulations at the Organization for Economic Co-operation and Development as well as the Environmental Protection Agency.  In addition, the committee approved the so-called substitution principle, which will demand that firms eliminate allegedly dangerous chemicals if there are substitutes. 

Industry has continually tried to make REACH a more reasonable program, but unfortunately been unsuccessful.  “The problem,” noted Logomasini, “is that REACH is inherently unreasonable; it cannot be fixed because the concept if fundamentally flawed.  Industry would be wiser to fight the entire program rather than try to make it less painful.  Implementing REACH will cost Europe and its trade partners billions of dollars and not have any benefit whatsoever. It will just reduce innovation and limit access to EU markets.”

For more information see Europe’s Global REACH: Costly for the World; Suicidal for Europe and the 2006 update: Still Overreaching at www.fahayek.org.