Chemical market and Brexit: what will happen in no deal case?

In these days EU and UK are discussing about Brexit, after the UK citizens decided to leave the European Union. This historical event is going to have an impact in the relations between EU countries, non-EU and UK.

Brexit timeline in 5 steps

  1. 2016 – 23rd June: 51,9% of UK citizens voted to exit from the EU;
  2. 2017 – 29th March: Art. 50 of the Lisbon Treaty was invoked. UK and EU have 2 years to negotiate the withdrawal;
  3. 2018 April – 2019 March: negotiations;
  4. 2019 – 21st March: the European Council agreed to postpone the UK withdrawal to 22nd May 2019. In case of no agreement before 29th March by the UK, the EU granted a shorter extension to 12th April;
  5. 2019 – 29th March: the deal has been rejected by UK House of Commons

What could happen to the chemical market in no deal case?

Two different regulations shall apply:

  • EU REACH: Registration, Evaluation, Authorization and Restriction of Chemicals. This EU regulation defends human health and the environment from the possible risks attributable to chemical products. The aim of the regulation is also to promote the chemical industry competitiveness in the market. EU REACH concerns all chemical substances and its driving authority is ECHA – European Chemicals Agency;
  • UK REACH: the EU REACH Regulation will be replaced by UK REACH. The UK regulations would preserve EU REACH, with some technical changes. HSE – The Health and Safety Executive will be the lead regulatory authority, with its own IT system.

Therefore, in no deal case, EU and UK agencies will act independently from each other, with two different IT systems. 

If the chemicals companies with different roles in the supply chain intend to maintain their presence in the two markets, they will need to be compliant both in the EU and in the UK.
On February 2019, ECHA released further guidance on how to be compliant in case of UK withdrawal. The HSE also released some guidelines to follow in no deal scenario.Dr. Andrea Galanti, Mixer S.p.A general director, says: “At the end of the day, we think that raw material availability will not be affected by Brexit, but all the formal documents related to the material declarations will need to be reviewed because all the UK materials will not be European anymore”. 

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