Small businesses burned by REACH

London - Small businesses which use harmful chemicals must by now have met the pre-registration deadline of an EU environmental regulation, or face being fined and sent to prison if they do not comply with it.

Firms must record any of the hazardous substances they buy, sell or use under the Registration, Evaluation, Authorisation and Restriction of Chemicals regulation (REACH) by 1 Dec, when the pre-registration period closes. If they fail to register by this date, they will be forced to cease manufacturing and importing chemicals until they have signed up.

"Compliance with the REACH Regulation can be a lengthy, complicated process. It often requires taking valuable time and resources away from other areas of a business, and is an additional strain for small firms already suffering in the current economic climate," said FPB Spokesperson, Phil McCabe. "However, the consequences of not signing up could be even more severe. The best advice is to be prepared and take the appropriate steps to make sure you are covered."

The FPB is urging the 25,000 businesses it represents to act now to find out if they need to register. That means investigating substances they use, how these chemicals are used and who supplies them.

The REACH pre-registration period was launched on 1 June 2008. However, by mid-September, just 1,207 businesses had registered. In a statement, the Parliamentary Under-Secretary for the Department for Environment, Food and Rural Affairs, Huw Irranca-Davies, acknowledged that many firms could be caught out.

"Most businesses use chemicals in some form, in fact, many rely on them without even realising it," he said. "Even if you only use chemicals to keep your machinery operating and your premises clean, or you import finished products, or if you receive substances containing chemicals through a supplier and use them in an unusual way – it’s likely you’ll need to take some action under REACH."

"Given the very wide scope of REACH, it is likely that almost every sector of UK business and industry will be affected in some way. We estimate that there are around 4.7 million small and medium-sized businesses in the UK across all sectors of industry – you don’t have to be a mathematician to work out that this means a lot of companies are likely to be affected by the Regulations."

In addition to having to pay to comply with the REACH Regulation following the registration process, which in 2007 The European Chemical Agency estimated would cover firms for between 30,000 and 70,000 substances, many business-owners face an administrative nightmare.

FPB member Francis Pound, of specialist chemical firm A V Pound & Co Ltd, Surrey, has had to employ two full-time members of staff working extra hours in order to comply with the REACH Regulation. In addition to checking existing substances, Mr Pound must account for any future chemicals he may want to import.

"We’re in the process of dealing with this now. The whole thing is stupid. It’s a complete nightmare because it’s so complicated. It’s taken us three months just to get to the stage where we can register," said Mr Pound. "We have to write to all of our customers to ask what they do with the products we supply them with, and also to our own suppliers. You can imagine what kind of answers we get."

He added: "This is going on through almost every industry sector – not just chemical producers but all through the supply chain. The costs are going to be vast."
More information on REACH is available from the FPB’s helpline on 0845 130 1722.

The FPB has launched a petition calling on the Government to ensure that banks fulfil their bail-out obligations of staying 'open for business', particularly when it comes to smaller firms. The petition is available on the 10 Downing Street website: http://petitions.number10.gov.uk/Banks-and-SMEs/ <http://petitions.number10.gov.uk/Banks-and-SMEs/>