With all attention originally focused on preregistration, few companies planned much beyond that first step. But there is much still to do before full registration is within grasp. Going forward, this article sets out the key steps that every company must understand, suggests the pitfalls to be avoided, and highlights some of the related initiatives that companies should consider.

Preregistration, which closed on Dec. 1, 2008, was the essential first step for companies to benefit from the extended deadlines for achieving full registration under REACH, and to ensure continued EU market access. Unless they fulfill a very narrow set of conditions, companies that missed that Dec. 1, 2008, deadline must stop placing their products on the market and act to complete their registration obligation as soon as possible. Enforcement actions on imports are checking whether preregistration was properly achieved, and will stop entry into the EU if preregistration of all substances in the product is not fully documented. No data, no market is the REACH mantra.

Nevertheless, despite the deadlines passing, late preregistration for new actors is available – under limited conditions. This is open to: (1) new EU manufacturers and new EU importers; (2) only representatives of new non-EU manufacturers and new non-EU formulators; and (3) new EU producers and new EU importers of articles (with substances intended to be released under normal or reasonably foreseeable conditions of use).

OVERVIEW OF OBLIGATIONS

First, a reminder on registration.

All substances placed on the EU market in quantities over 1 metric ton per year, whether alone, in preparations or contained in articles (finished products) if the substance is intended to be released from the article under normal or reasonably foreseeable conditions of use, must be registered with the European Chemicals Agency (ECHA).

Except for specific high-risk chemicals with more stringent deadlines, most REACH registrations will be phased between 2010 and 2018, depending on the tonnage sold in the EU. Registration also requires a technical dossier to be developed for each chemical substance, covering more than 60 data points.

Most lubricants are typically preparations made from oil-based substances. In theory, a lubricant might be exempt from REACH registration – if it is covered either in (1) Annex IV of REACH which provides a list of chemicals that are recognized as low concern, or (2) Annex V, which sets out descriptors of naturally occurring unmodified substances.

In reality, those two exemptions are unlikely to apply here, and REACH obligations will blanket most lubricants, metalworking fluids and greases.

The detailed registration requirements for REACH vary depending on the hazardous properties of the substance in question and the volume manufactured or imported by each entity. REACH allows for extended registration deadlines only if the substance is a so-called phase-in substance (mainly substances listed in the European Inventory of Existing Commercial Chemical Substances, EINECS), and was duly preregistered by Dec. 1, 2008.

The Regulation also specifies that manufacturers, importers or downstream users shall not place on the market or use substances of very high concern (SVHC) that have been listed in Annex XIV of REACH unless that substance is subject to an authorization under the regulation. For example, lubes or metalworking fluids which contain unrefined and mildly refined base oils have the potential to be SVHC, due to their probable carcinogenic properties.

Article 57 of the REACH regulation 1907/2006 defines SVHC as substances that are classified as CMR (carcinogenic, mutagenic, or toxic for reproduction) Category 1 or 2; PBT (persistent, bioaccumulative or toxic for the environment); vPvB (very persistent, very bioaccumulative); endocrine disruptors, or having other equivalent health and environmental concerns.

Apart from situations involving articles (which would not typically apply to lubes and greases), there are no positive obligations in REACH concerning SVHC substances unless the substance in question is formally included in Annex XIV of the REACH regulation. Producers using these substance will therefore have to monitor the evolution of Annex XIV. If listed, the SVHC cannot be used unless it has been expressly authorized or is exempt from the authorization requirement. It will be up to the registrant or user to decide whether to seek authorization for the use in question. Alternatively, the substance could be substituted with one that is considered safer for that application, if available.

At present, Annex XIV is empty pending the results of coming evaluation procedures. The main concern in terms of registration of substances having SVHC properties is to identify and properly name them during the registration process (including constituents, impurities or degrades thereof). Any evaluation and authorization procedures concerning these substances will start only after the registration of the substance and in light of the establishment of the Annex XIV list. Updates on the Annex XIV list will be posted on the ECHA website, www.echa.europa.eu.

COMMUNICATING REACH

The precursor to the Annex XIV list is the candidate list, which currently lists 15 SVHCs for potential authorization status. This candidate list, based on input from the EU member states, was published in October 2008 and will be periodically updated. It is important that companies in the lubricants and grease industry review this list to determine if their products use any of these substances. For instance, short chain chlorinated paraffins, which have been used in industrial metalworking lubricating fluids among other applications, are included in this list.

If you do use of any these candidate list substances, immediate legal obligations will arise in the form of communications in the supply chain. Suppliers of such substances have to provide their customers with an EU-compliant safety data sheet.

With regard to lubricant and metalworking fluids that are preparations, suppliers of such preparations that are not classified as dangerous according to Directive 1999/45/EC must provide the recipients, at their request, with a safety data sheet if the preparations contain at least one substance on the candidate list and its individual concentration is at least 0.1 percent (w/w) for non-gaseous preparations, and at least 0.2 percent by volume for gaseous preparations.

Generally, in todays markets where sensitivities to environmental and health impacts run high and nongovermental organizations target products that allegedly expose consumers to unwanted risks, companies must not only deal with formal regulatory requirements but also must protect their markets by adequate and appropriate communications throughout the supply chain.

MANAGING REACH

In general, non-EU companies in the lubricants industry need to review the qualifications of their only representatives – the legal entity representing them in the EU – to ensure that those that were able to handle the preregistration requirements are equally equipped to take forward the more complex registration procedures. For EU-based businesses, the same holds true for third party representatives.

For every substance covered under REACH, companies will be arranged into a substance information exchange forum (SEIF). All competitors having preregistered a substance need to organize themselves to provide or generate the data required for registration. Companies must determine the role they wish to play in each substance-related SIEF. For example, a company whose substance is of great commercial value might wish to be involved in the management of the SIEF, even to become its lead registrant. For substances of lesser business value, a more passive role might be appropriate.

The immediate priority during the current pre-SIEF period, between the end of the preregistration window on December 1 and the formation of the SIEF, will be for all the preregistrants for each substance to reach agreement on substance sameness. This means agreeing that their substances have the same chemical identity, or uniform toxicological profiles, i.e. that the chemical composition and hazard profile of a substance produced from different sources are sufficiently similar to be part of the same joint registration.

It must be pointed out that for lubricants and greases based on mineral oils, the chemical profiles could be uncertain because, in most cases, they will be substances of unknown or variable composition, complex reaction products or biological materials (UVCBs). This would could lead to significant sameness discussions during the pre-SIEF stages.

TO CONSORT, OR NOT?

Aside from the SEIF, many companies will also have to decide whether joining a consortium makes good business sense for their REACH efforts. Cooperation with competitors in a SIEF is mandatory for phase-in substance preregistrants; participation in consortia is voluntary and motivated by the mutual benefit of its members. The duration of a consortium may extend beyond the life of the SIEF, post-June 2018, or vice versa. There also may be differences in membership.

Participants in the SIEF will include registering manufacturers or importers over the minimum 1 tonne volume threshold, previous registrants of inter alia plant protection or biocidal products, and data holders who are not required to preregister under the regulation but who wish to join the SIEF in order to sell relevant data (for example, laboratories, trade associations, and certain downstream users).

In contrast, consortia will not necessarily involve all SIEF members and may include participants who are not part of the SIEF, such as third parties who are not data holders (for example, trade associations or service providers such as law firms and consultancies) or those producing or importing a substance in the EU for the first time after closure of the preregistration window.

Many of these same management considerations apply to consortia. Companies should analyze the business value of creating or joining a consortium. They will wish to evaluate the financial demands inherent in joining such groups and, in some cases, participate actively in the determination of the fees.

Another critical area for companies is to ensure protection of their own intellectual property, as data-sharing mechanisms are implemented. The European oil trade association, CONCAWE, appears to have created a consortium that would be relevant for registration of mineral oil based lubricants, and the European Lubricating Grease Institute, ELGI, organized another, this one dedicated to the reaction products for making soap-based greases.

Competition (anti-trust) compliance is another area that companies need to examine, both to ensure the proper management of pre-SIEF, SIEF and consortia meetings and their documentation, and to prepare individuals in the company for appropriate behavior at such collective meetings and in correspondence with competitors. Training should be organized and, where absent, competition compliance schemes developed and documented.

Data management will require a secure, user-friendly IT system for management of a companys complete compliance activities. With varying deadlines, different levels of participation in collective groups, data provision or generation activities, financial and logistical considerations, a company will be quickly overwhelmed if a management system enabling it to track its involvement and manage deadlines is not in place.

REACH FOR EFFECTIVE STRATEGIES

Every company should develop its own strategy for sourcing data to fill crucial data gaps, including: literature search and review, data evaluation and valuation, study protocol recommendations, provision of cost estimates, sourcing contract research organizations and studies (e.g. acquisition from other SIEF members, further testing etc.)

Companies should review the adequacy of registration activities and determine further measures needed. The preparation of chemical safety assessments (CSAs) and reports (CSRs) needs to be organized or adapted to the REACH requirements. Classification and labelling considerations must be understood and the appropriate value-chain communications implemented. In some instances, companies may require product-specific advocacy with regulators at either European or national level.

A company with multinational or global activities also should be aware of the increasing appeal of REACH to regulators in other parts of the world, from California to China. REACH is seen as a desirable evolution in the regulation of chemicals and, because it has an impact on producers worldwide, will be an attractive package for regulators to consider. Companies may wish to express their views on such an evolution in their own region with well-prepared and documented information.

MORE TO REACH

Post-registration brings its own requirements, such as the need to respond effectively to questions raised by ECHA or national authorities.

Authorization: Dossiers require special care in making submissions and must include relevant socioeconomic and alternatives analyses.

Product defense: REACH has already sparked significant pressures from suppliers and customers to defend substances against deselection and restrictions. Constructive interaction with policy makers not only in Europe but also in the relevant world regions, will be a necessary part of protecting markets for substances and/or managing the development of and transition to alternative products. Companies should integrate such considerations into their REACH compliance strategies.

Value chain relationships: These will become increasingly important as debate increases around the safety and role of specific substances. It is of critical importance that these relationships be well managed. Companies must anticipate issues and provide creative solutions to real and perceived difficulties.

The above sets out the main areas which require careful consideration by every company caught in the scope of the REACH regulation. Preregistration activities were only the critical first step.

As this analysis illustrates, the next phases are infinitely more complex. Continued market access is at stake – not only from a regulatory perspective but also from the broader commercial environment. Now is the time for a company to take stock and organize itself to deal with these challenges.