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CHEMICALS & PHARMACEUTICALS
SUPPORT IS TOP OF THE AGENDA
Tim Doggett, CEO of the Chemical Business Association (CBA), discusses some of the issues facing the sector and highlights the CBA’s role in supporting industry
ollowing several turbulent years, companies within the chemical supply chain, as well as their customers, downstream users, and the broader sector alike, continue to face ongoing obstacles. The chemical sector spans chemical manufacturing to distribution and beyond. Virtually all manufactured products contain inputs from the sector.
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Although it has faced and successfully conquered several issues resulting from Brexit, Covid-19, the shortage of HGV drivers, and the geopolitical fall-out from the war in Ukraine, the impact of some issues persist. When the UK was part of the EU, the lack of barriers enabled reliable ‘just in time’ deliveries, allowing businesses to maintain lower stock and inventory levels, helping cash flow and ensuring uninterrupted operations. However, leaving the EU has had a
significant impact on the UK’s chemical supply chain. Because of the increase in administration, customs formalities and border checks, the ‘just in time’ model has changed to one of ‘just in case’, with larger consignments being shipped less frequently, and more stock being stored locally. This has impacted cash flow, increased risk to buyers, and resulted in additional costs for the handling and storage of stock. Additionally, the complex nature of the Northern Ireland Protocol created further layers of complication. While it may have created opportunities for some companies, this has generally been due to others exiting the market because of the additional costs and uncertainty caused by the political disagreements between the UK and the EU. As the effects of Brexit linger and its impact continues to be felt across the chemical supply chain, the CBA remains proactive in assisting its members to adjust and in strongly lobbying on its behalf.
Another issue that remains at the top of the association’s agenda is UK REACH, the implementation of which would effectively mean that tens of thousands of substances in
26 JUNE 2023 | PROCESS & CONTROL
The chemical sector is one of the most important and diverse industries in the world
the EU REACH database must be re-registered. The estimated cost to industry of data acquisition, registration fees and associated administration was estimated in a Department for Environment, Food and Rural Affairs (DEFRA) Impact Assessment to be between £2 billion and £3.6 billion. This indicates that the cost of UK REACH could be more than four times the £500 million that UK companies have already spent to comply with EU REACH. Additionally, there is the risk that it would lead to duplication of animal testing. The CBA has been working with other affected trade associations on this issue through the Alliance of Chemical Associations (ACA). By working together, the parties have been able to give a louder voice to the potential issues that UK REACH will bring to the chemical supply chain and have consistently called for legislation to be amended to avoid the significant additional costs, as well as its potentially devastating impact on raw material availability to manufacturers in the UK and downstream users who were previously not within the scope of the regulation. With the CBA having tirelessly lobbied and led discussions on UK REACH, a breakthrough came at the end of 2021 when DEFRA announced its intention to investigate an alternative registration model. They also advised their intention to consult separately on extending the deadlines, with the consultation concluding in September 2022. Following the announcement, the CBA continued its efforts by providing expert advice and input to various working groups, including the UK REACH Oversight Group and Technical Working Group established by DEFRA. It also hosted several UK REACH seminars and Online Clinics which were open to CBA members and non-members alike. The consultation received a significant number of submissions and the CBA welcomed the Government’s announcement
to extend the transitional registration deadlines for UK REACH. This was laid before parliament in April 2023.
The CBA remains united with other stakeholders and industry in wanting a pragmatic and workable UK REACH solution which maintains high standards of environmental and human health and safety, and which allows the UK chemical industry and related businesses to remain competitive in the global marketplace.
In the past year, the CBA also successfully lobbied for important changes on legislation that would otherwise have impacted the entire chemical industry and beyond. In December 2021, a legislative proposal was laid before Parliament by the UK Advisory Council on the Misuse of Drugs to strengthen controls on gamma butyrolactone (GBL) and 1,4- butanediol (1,4-BD or BDO). These changes were due to come into force in June 2022. To highlight these changes, CBA ran two Online Clinics in early 2022, which were open to both members and non-members, and where it also had participation from the UK Home Office to highlight the licencing requirements for these controlled drugs.
Through its own impact assessments, CBA found that at least 7,500 businesses across many industry sectors, including the automotive, manufacturing, pharmaceutical, foundries and printing industries, would be adversely affected by the proposed licencing requirements. The assessment also highlighted the fact that if the legislation went ahead as is, the increased volume of applications for controlled drug licences would inevitably cause delays in the approval process, leading to disruptions to the chemical supply chain. The CBA led and coordinated discussions with the Home Office, resulting in the amendments being revoked.
Chemical Business Association
www.chemical.org.uk
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