1. finance
2. investing
3. options

Technical assistance related to the review of
REACH with regard to the extension of the
registration requirements for substances
manufactured or imported between 1 and 10
tonnes per year (ENV.A.3/SER/2013/0057r)
Final Report (updated) on the extension of the registration
requirements for substances manufactured or imported
between 1 and 10 tonnes per year
prepared for
DG Environment
Original: 27 February 2015
Updated to provide total PV benefits: 17 March 2015
Final Report (updated) on the extension of the registration requirements for substances
manufactured or imported between 1 and 10 tonnes per year
Quality Assurance
Project reference / title
J839/ REACH 1 to 10t Phase 2
Report status
Final Report (Updated)
Author(s)
Anthony Footitt (RPA)
Marco Camboni (RPA)
Jan Smidt (CSES)
Approved for issue by
Meg Postle
Date of issue
17 March 2015
Document Change Record
Report
Version
Date
Change details
Interim
1
3 June 2014
N/A
First Options Paper
Expanding on Options
1
22 July 2014
N/A
Final Options Paper
2
5 August 2014
Expanding on the first paper and the Interim Report to
provide further reasoning behind options
Paper on Annex III
1
7 August 2014
Paper specific to Annex III to assist the Commission
with its discussion on Annex III interpretation
Draft Final – Sections 1 to 3
1
17 October 2014
Drawing previous documents into one document
following agreement of options on 29 August 2014
Draft Final Sections 1, 2, 3
and 4.1 to 4.3
2
12 November 2014 Revisions following comments and addition of
sections on modelling numbers of substances
Draft Final Sections 1, 2, 3
and 4.1 to 4.5
3
25 November 2014 Revisions following comments and addition of
sections on modelling of costs
Draft Final Sections 1, 2, 3
and 4
4
2 December 2014
Revisions following comments and addition of
sections on modelling of costs to companies
Draft Final Sections 1, 2, 3
and 4
5
8 December 2014
Revisions and clarifications before submission for
circulation to colleagues in other DGs for comment
and agreement on variables for full analysis
Draft Final Report
6
4 February 2015
Incorporation of calculated costs and benefits after
final agreement from the Commission on cost
assumptions (received 23 December 2014)
Final Report
7
27 February 2015
Adjustment of text in light of comments on the Draft
Final Report
Final Report (Updated)
8
17 March 2015
Updated to provide estimates of total Present Value
(PV) benefits of the options over a 30 year period (to
be consistent with the Extended Impact Assessment)
Disclaimer
The views and propositions expressed herein are, unless otherwise stated,
those of Risk & Policy Analysts and do not necessarily represent any official
view of DG Environment or any other organisation mentioned in this report.
Table of contents
Executive Summary
1
Introduction ......................................................................................................................... 1
1.1 Study Objectives ................................................................................................................... 1
1.2 Structure of the Report.......................................................................................................... 2
2
Current Requirements under REACH for 1-10t Substances ..................................................... 3
2.1 Overview of Requirements .................................................................................................... 3
2.2 Registration Dossier Information Requirements ...................................................................... 4
2.3 Duty to Communicate Information in the Supply Chain.......................................................... 12
2.4 Compliance with Parallel Regulation..................................................................................... 18
3
Development of Options for Refining Information Requirements......................................... 25
3.1 Introduction........................................................................................................................ 25
3.2 Options for Altering Annex III ............................................................................................... 27
3.3 Combining the Annex III and Extended Information Options to a Final Five ............................. 29
4
Summary of Methods used to Analyse Options ................................................................... 32
4.1 Overview ............................................................................................................................ 32
4.2 Number and Nature of Substances ....................................................................................... 34
4.3 Number of Substances Requiring Toxicological and Ecotoxicological Information under the
Options ...................................................................................................................................... 36
4.4 Cost of Information Gathering.............................................................................................. 42
4.5 Substance Registration Costs ............................................................................................... 44
4.6 Aggregation of costs using the simulation ............................................................................. 46
5
Cost Estimation .................................................................................................................. 49
5.1 Approach to Estimation ....................................................................................................... 49
5.2 Estimated cost of substance withdrawal ............................................................................... 55
5.3 Estimated costs of registration ............................................................................................. 58
5.4 Total costs of the Options .................................................................................................... 61
6
Business impacts ................................................................................................................ 63
6.1 Overview ............................................................................................................................ 63
6.2 Impact of substance withdrawal on manufacturers and importers (MIs)................................. 63
6.3 Impact of substance withdrawal on downstream users (DUs) ................................................ 73
6.4 Impact of registration on manufacturers and importers (MIs) ................................................ 77
6.5 Impact of registration on downstream users (DUs) ................................................................ 84
7
Benefits .............................................................................................................................. 89
7.1 Numbers of hazardous substances and properties identified ................................................. 89
7.2 Impact of the Options on Damage Costs ............................................................................... 92
8
Conclusions ...................................................................................................................... 101
8.1 Comparing the Options...................................................................................................... 101
Annex 1
Defining the Annex VII+ and VII++ Options ............................................................. 109
Annex 2
Detailed Description of the Monte Carlo Modelling ................................................ 131
Executive Summary
1.
Study Objectives
Article 138(3) of REACH identifies that the Commission may present legislative proposals to modify
the information requirements for substances registered in the 1-10t band.
The Commission has contracted RPA and CSES to provide technical, scientific and policy support in
order for it to decide on the appropriateness of proposing changes to the information requirements
for these substances and develop its proposal accordingly.
2.
Current Requirements for 1-10t substances
2.1
Information required in Registration Dossiers
The general information required in technical registration dossiers of substances (on their own and,
as mixtures or in articles) is set out in Article 10(a) of REACH. The information to be submitted
depending on tonnage is defined in Article 12 of the Regulation in combination with the Annex
relevant to the tonnage band; Annex VII in the case of the 1-10t substances. Annex VII is, itself,
divided into two types of information:


information on physicochemical properties – where this is required for all 1-10t substances;
information on toxicological and ecotoxicological properties – where this is only required
for certain types of 1-10t substances.
In relation to the latter, information on toxicological and ecotoxicological properties in Annex VII is,
however, only required for 1-10t ‘priority substances’, where these are substances that meet the
criteria in Annex III (as amended) which are:
"(a) substances for which it is predicted (i.e. by the application of (Q)SARs or other evidence) that
they are likely to meet the criteria for category 1A or 1B classification in the hazard classes
carcinogenicity, germ cell mutagenicity or reproductive toxicity or the criteria in Annex XIII;
(b) substances:
i.
with dispersive or diffuse use(s) particularly where such substances are used in
consumer mixtures or incorporated into consumer articles; and
ii.
for which it is predicted (i.e. by application of (Q)SARs or other evidence) that they
are likely to meet the classification criteria for any health or environmental hazard
classes or differentiations under Regulation (EC) No 1272/2008”.
The effect of Article 12 (making reference to Annex III) is that it divides the 1-10t substances into
those that:

are required only to provide the physico-chemical information in Annex VII (as outlined
earlier); and

in addition to the physico-chemical information (outlined earlier), are required to provide
information on the human health and environmental endpoints according to Annex VII.
i
2.2
Control of Hazards and Risks
The requirement to conduct a Chemical Safety Assessments (CSAs) does not currently apply to the 110t substances but Article 31 of REACH requires the communication of hazard information to
downstream users Safety Data Sheets (SDS). As such, risk management is, at present, to be
achieved via classification under Regulation (EC) No 1272/2008 (CLP) which, in turn, triggers risk
management requirements under other community regulation including:




Worker health and safety regulation;
Product safety requirements;
Waste regulation; and
Regulation that sets limit values and exposure limits.
3.
Options for Refining Information Requirements
3.1
Background
The overall aim of REACH as a whole is to achieve:



a high level of protection of human health and environment;
free movement of substances on their own, in mixtures, and in articles; while
enhancing competitiveness and innovation.
One of the main drivers for the adoption of REACH is the fact that, prior to its adoption, information
on the inherent properties needed to manage chemicals safely was not available for a significant
percentage of the substances that have historically been placed on the European market (of which
more than half – around 20,000 - are expected to be registered in the 1-10t band only).
REACH seeks to address these issues and achieve its aims by requiring manufacturers and importers
to generate data on the substances they manufacture or import. At the same time, requirements
for generation of information on substances under REACH is tiered according to the volumes of
manufacture or importation of a substance - higher tonnage substances must generate more
information on more hazard endpoints.
For substances produced in quantities exceeding 10t per year, all substances must provide the
required toxicological and ecotoxicological information. To reduce the possible economic impact on
the 1-10t substances, however, REACH identifies that new toxicological and ecotoxicological
information should only be required for the “priority substances” that meet the criteria in Annex III.
As described above, “priority substances between 1 and 10 tonnes” under REACH are “substances for
which it is predicted (i.e. by the application of (Q)SARs or other evidence) that they are likely to meet
the criteria for”:


classification as C, M or R 1A/1B or PBT/vPvB; or
any health or environmental hazard classes or differentiations under CLP and have a
dispersive or diffuse use.
In respect of achieving the overarching aims of REACH the successfulness (or otherwise) of the
current strategy in relation to the 1-10t substances is highly dependent on the extent to which
hazardous properties will be correctly “predicted by the application of (Q)SARs or other evidence”.
ii
This applies to both the identification of priority substances and also to the overarching objective of
reducing the possible (cost) impact on low volume substances. This is because:

For the identification of priority substances: the successfulness of the strategy depends on
the extent to which QSARS or other evidence are able to correctly identify substances that
do have (as yet unknown) hazardous properties – any substances which are not correctly
identified as priority 1-10t substances will not have to provide the Annex VII toxicological
and ecotoxicological information (and their hazardous properties will not be identified and
risks managed); and

For reducing the possible economic impact on low volume substances: the successfulness
of the strategy depends on the extent to which QSARS or other evidence are able to
correctly identify substances that do not have hazardous properties – those substances that
are incorrectly identified as priority 1-10t substances would have to incur the costs of
providing Annex VII toxicological and ecotoxicological information despite the fact that no
hazardous properties would be identified by undertaking the testing (because there are
none).
3.2
Annex III Options
As no prediction by QSARs or other evidence is 100% accurate in its predictions, the study has
attempted to examine the likely successfulness of the current strategy and, within this, consider the
impact of adjustments to the criteria in Annex III and the impact of removing the Annex (and its
criteria). The options considered in relation to Annex III are:



3.3
Do nothing- the baseline;
Remove the diffuse/dispersive use criterion in Annex III – which would result in all 1-10t
substances identified by QSARs or other information to have any human health or
environmental classification to provide toxicological and ecotoxicological information (as
opposed to only those with dispersive/diffuse uses); and
Remove all criteria in Annex III – i.e. require all 1-10t substances to provide toxicological
and ecotoxicological information.
Information Options
In addition to examining the impact of alterations to Annex III (including its removal), the study has
also examined:



the nature of the toxicological and ecotoxicological information required under Annex VII;
the usefulness of that information; and
whether any refinements could be made which would further enhance the benefits in terms
of the identification and hazardous properties and implementation of suitable controls
(within acceptable cost boundaries).
The development of options for refining the toxicological and ecotoxicological information in Annex
VII has focussed on the merits of including human health and environmental endpoints that
currently apply to 10-100t substances under Annex VIII.
When selecting endpoints from Annex VIII, the overarching consideration has been the opportunities
that the additional information might provide for enhanced risk management. A key consideration
here has been that, as described above, a CSA is not required for 1-10t substances and a number of
iii
the information in Annex VIII are present specifically to provide the enhanced information required
to perform a CSA.
As well as considering the merits of additional information from inclusion of Annex VIII endpoints,
we have also considered alterations to the use of information that already forms a part of Annex VII.
This applies only to information that must already be gathered and could, in principle, be used to
screen for PBT/vPvB properties.
The following options for extending information requirements based on the inclusion of selected
Annex VIII endpoints have been developed:
3.4

Annex VII (the baseline): Current Annex VII toxicological and ecotoxicological information;

Annex VII+: Current Annex VII toxicological and ecotoxicological information plus endpoints
and requirements selected from Annex VIII to deliver additional classifications and
information with the smallest possible likely increase in cost;

Annex VII++: As Annex VII+ above but with the addition of certain key elements/changes
from Annex VIII that may deliver further benefits in terms of identification of hazardous
properties and substances with hazardous properties but would represent a more significant
increase in costs.
Combined Options
The study specification limited consideration to a maximum of five options for full assessment of
costs and benefits. Options for refining the information requirements in Annex VII have been
developed and assessed in combination with those for Annex III to provide the five overall options
required. Table 1 identifies which combinations of Annex III and Information Options were selected
for further analysis of costs and benefits (by agreement with the Commission).
Table 1: Final Combinations of Options to Progress to Full Impact Assessment
Annex III Options
Information Options
Current Annex VII
Annex VII+
Do nothing
Baseline
No
Remove diffuse/dispersive use criterion
Yes
Yes
Remove all criteria
Yes
Yes
4.
Annex VII++
No
Yes
No
Approach to the analysis of options
An Excel® based model and simulation has been developed to analyse and explore the options and
the baseline (current requirements) in terms of the following five key performance measures:
1. the number of substances with hazardous properties detected;
2. the usefulness of the information generated on these substances in the context of the
regulation of risks and risk management;
3. the cost of registering the 1-10t substances (including the generation of information);
4. the likely impact of registration costs at a company level considering that companies will be
registering several substances (a portfolio) sometimes as part of a joint (consortium)
registration and sometimes as an individual registration; and
5. considering the above, to the extent possible, the likely impacts on competition and
innovation.
iv
As with previous ex-ante studies on REACH (such as the various Business Impact Assessments – BIAs
and studies on REACH benefits), the model and analysis must make predictions on the outcomes
based on the best available information of what the outcomes are likely to be (rather than what they
certainly are). For those registrations yet to be completed (including the 1-10t substances), there is
no certain knowledge on the outcome. It is this paucity of information that REACH itself seeks to
address. There is also no certain knowledge on other factors including:






The exact number of 1-10t substances;
The exact number of substances that will be identified by QSARs and other evidence as
priority substances (correctly or incorrectly) and will be required to generate toxicological
and ecotoxicological information;
The exact cost of generating the necessary toxicological and ecotoxicological information for
those substances;
The exact cost of producing registration dossiers for 1-10t substances;
The exact number of companies that will be registering one or more substances in the 1-10t
band and the size of those companies (micro, small, medium and large); and
The exact number of registrants for each substance and the cost sharing arrangements that
will be made between the companies registering (where there is more than one
manufacturer/importer).
In order to provide an analysis, then, the modelling and simulation must rely on informed prediction
of factors including the above to provide a best estimate of the five performance measures for each
option and the baseline. The outputs of the model are, then, sensitive to the input values used.
However, where previous assessments (such as the BIAs) sought to predict the total costs of the
regulation as a whole, the analysis of options for the 1-10t substances is focussed on the differences
between the options (and the baseline) in terms of costs and benefits. This makes the current
analysis far less sensitive to the underlying inputs and assumptions on the factors described above
because the same assumptions apply across all of the options including the baseline. Here, of the
factors described above, only two differ from one option to the next. These are:


the number of substances that will be required to generate the toxicological and
ecotoxicological information required under the option; and
the additional cost of any further information required under an information option.
With regard to the number of substances required to generate the toxicological and ecotoxicological
information under the options, the effectiveness (or otherwise) of “QSARs or other information” in
relation to the identification of substances meeting the criteria in Annex III is of prime importance.
It is important to note that Annex III does not specify in detail what is required in relation to these
and other tools. This issue was highlighted early in the study’s timeframe and both the Commission
and ECHA have agreed that the requirements of Annex III probably need to be specified in more
detail to ensure that the prioritisation process achieves what is intended (to the extent possible
given the technical limitations of the tools available). The Commission and ECHA agreed to provide
guidance to 1 - 10 t registrants on this issue in 2015.
v
For the purposes of the analysis (and the model), based on a review of the work undertaken in 2006
by RPA for DG Enterprise1 and also in view of the current wording of Annex III, the following
interpretation has been applied:
1. Screening Tools are used (without expert judgement): Annex III is applied by all
manufacturers and importers based on existing data and QSAR-screening and similar ‘quick
scans’ without the use of expert judgement2. There are many freely available tools that
might be used for this purpose with the main tools currently available being the Analog
Identification Methodology (AIM), Danish (Q)SAR database, Toxmatch, and the OECD QSAR
Toolbox. Manufacturers and importers would obtain one or more such tools and apply them
in-house or commission a QSAR consultancy to obtain results from similar/the same QSAR
tools;
2. A positive decision rule applies: to be identified as a priority 1-10t substance, there must be
positive evidence of hazardous properties; and
3. Absence of evidence equates to absence of effects: By extension of the above, the absence
of evidence is taken as absence of effects3. This includes cases/substances where there is no
existing test information and no prediction by QSARs (or other approaches) can be made (for
example, because a substance is out of the ‘domain’ of a QSAR model). The latter
substances would not be 1-10t priority substances (and no new toxicological or
ecotoxicological information would be generated under REACH).
For the benefit of transparency, all of the assumptions and numbers underlying the modelling and
simulation are described in detail in Annex 2 of this report. These were supplied to (and agreed by)
the Commission in advance so that the subsequent analysis could be based on an agreed set of
numbers and assumptions.
1
As part of the Technical Assistance for REACH Impact Assessment Updates focussing on the then (2005)
Common Position Text and also the Recommendation for the Second Reading (Sacconi, (2006 : ***II
Recommendation for Second Reading, Session document of the European Parliament, Final A6-0352/2006,
dated 13.10.2006).
2
The alternative would be robust QSARs of the sort described in Annex XI 1.3. Such QSARs would be
expensive to apply owing, in part, to the need for expert judgement. According to ECHA representatives
(pers comm, 2014) this makes such QSARs potentially as costly or more costly to apply than undertaking
the equivalent in vitro test. This would not be consistent with the objective of Article 12 and Annex III to
reduce the burden on low volume substance manufacturers. However, without expert judgement there is
significant risk that the screening will not return reliable results.
3
The absence of evidence of effects is not generally otherwise accepted as evidence of absence of effects. See
for
example
Danish
experience
on
regulatory
use
of
QSARs
https://echa.europa.eu/documents/10162/13639/qsarws_wedebye_tule_en.pdf
vi
5.
Assessment of costs and business impacts
5.1
Cost and cost estimation
At the most basic level, the economic costs of the options (and the baseline) comprise:

The cost of registering substances under REACH; and

Where the cost of registering certain substances is unsupportable on the grounds of
financial cost (and/or its properties render it unsuitable for continued use), the cost of
withdrawing those substances from the market.
Two major groups of operators will incur such costs: Manufacturers and Importers (MIs); and
Downstream Users (DUs). Costs have been considered in terms of:

MI direct costs of registration –the costs of registering substances will be incurred initially
by MIs registering those substances. A proportion of these costs will be absorbed by the MIs
themselves (representing the MI costs of registration) and a proportion will be passed down
the supply chain (to downstream users) as, for example, an increase in product price;

DU indirect costs of registration: linked to the above, DUs will incur an increase in costs that
is proportional to the cost of registration not absorbed by the MIs themselves;

MI costs of withdrawal: where a substance is not registered and is withdrawn from the
market MIs will lose any profit that would otherwise have been made in the absence of the
Regulation; and

DU costs of withdrawal: where a substance is not registered and is withdrawn from the
market by MIs, DUs will incur costs associated with the need to reformulate or otherwise
adjust their business to cope with the withdrawal. These costs would not be incurred in the
absence of the Regulation.
Using a probabilistic approach, the model developed in this study produces estimates of the costs
for each of the individual companies manufacturing/importing each substance. The raw data
produced by the modelled simulation thus allows analysis of costs at individual company level
and/or at the level of a substance.
The simulation also permits detailed analysis of costs and impacts by, for example, size of enterprise.
This, in turn, provides enhanced information for the assessment of less quantifiable impacts such as
competition and innovation as part of an analysis of business impacts.
The total costs of registering the (estimated 20,000) 1-10t substances are summarised in Table 2 for
the baseline and each option. All costs are assumed to be incurred over the four year period
between 2015 and the registration deadline (2018) and are reported as Present Values (PV)
discounted at 4%. The estimates include the division of total costs between MIs and DUs.
vii
Table 2: Summary and total costs of the options (all values expressed as Present Values discounted at 4%)
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
Costs of Withdrawal
MI costs of withdrawal
(income foregone)
€ 31.5
€ 49.4
€ 80.5
€ 51.2
€ 83.8
€ 152.3
(€millions)
DU costs of withdrawal
(maximum
€ 81.0
€ 126.9
€ 203.5
€ 134.7
€ 217.0
€ 436.6
reformulation cost)
(€millions)
Registration costs
MI costs of registration
€ 206.4
€ 258.7
€ 346.7
€ 263.9
€ 356.0
€ 323.7
(€ millions)
DU costs of registration
€ 206.4
€ 258.7
€ 346.7
€ 263.9
€ 356.0
€ 323.7
(€ millions)
Total Costs
Total Costs to MIs
€ 237.9
€ 308.1
€ 427.2
€ 315.1
€ 439.8
€ 476.0
(€millions)
Total costs to DUs
€ 287.4
€ 385.7
€ 550.2
€ 398.7
€ 573.0
€ 760.3
(€millions)
Total costs (€ millions)
€ 525.2
€ 693.8
€ 977.4
€ 713.8
€ 1,012.8
€ 1,236.3
5.2
Business impacts
5.2.1 Impact of substance withdrawal on manufacturers and importers (MIs)
Number of MIs impacted by withdrawal
Table 3 provides data on the number of MI companies withdrawing one or more substances from
their portfolios and the same numbers expressed as a percentage of the total number of companies
in the appropriate size category.
Table 3: Number of MI Companies impacted by withdrawal
Baseline
Annex VII - Annex VII - Annex VII+
No
No Annex
- No
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Use
Use
Criterion in
Criterion in
Annex III
Annex III
Percentage of total companies in size category
Micro companies
11.1%
16.4%
25.6%
16.8%
Small Companies
14.0%
21.7%
33.5%
22.6%
Medium Companies
25.3%
36.6%
52.2%
38.5%
Large Companies
64.5%
82.5%
89.3%
84.0%
Total
14.6%
21.3%
31.6%
22.0%
viii
Annex VII+
- No Annex
III
Annex
VII++ - No
Diffuse/
Dispersive
Use
Criterion in
Annex III
26.4%
34.9%
55.2%
91.0%
32.7%
41.4%
52.3%
74.9%
100.0%
48.4%
Levels of production withdrawn by MIs
The estimated average percentage of annual production withdrawn by companies that withdraw
one or more substances is provided in Table 4.
Table 4: Average percentage of annual production withdrawn by affected companies
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
Average percentage of annual production tonnage withdrawn by affected companies
Micro companies
23%
24%
25%
24%
26%
27%
Small Companies
17%
18%
20%
18%
20%
22%
Medium Companies
10%
12%
13%
12%
13%
16%
Large Companies
4%
5%
7%
6%
8%
15%
Total
17%
18%
21%
19%
21%
24%
Annual Income foregone by MIs owing to withdrawal
In terms of the financial impact of withdrawal on these companies, Table 5 provides the total annual
income foregone by companies of different sizes and the average annual income foregone per
company by size.
Table 5: Annual Income foregone owing to withdrawal
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
No
No Annex
- No
- No Annex
Diffuse/
III
Diffuse/
III
Dispersive
Dispersive
Use
Use
Criterion in
Criterion in
Annex III
Annex III
Average annual income foregone per company (€ thousand)
Micro companies
€ 3.8
€ 4.0
€ 4.2
€ 3.9
€ 4.2
Small Companies
€ 4.0
€ 4.1
€ 4.5
€ 4.1
€ 4.5
Medium Companies
€ 4.4
€ 4.8
€ 5.5
€ 4.8
€ 5.4
Large Companies
€ 6.6
€ 8.4
€ 11.7
€ 8.9
€ 12.3
Overall
€ 4.3
€ 4.7
€ 5.1
€ 4.7
€ 5.2
Annex
VII++ - No
Diffuse/
Dispersive
Use
Criterion in
Annex III
€ 4.6
€ 5.1
€ 6.8
€ 25.0
€ 6.4
5.2.2 Impact of substance withdrawal on downstream users (DUs)
In terms of the impacts on individual downstream users, little is known about the numbers of
downstream users other than, despite the low tonnages involved, there may be several on average,
each using low volumes of the substances.
Estimates have been made on the cost of each option to individual downstream users. This suggests
that average costs per DU are fairly similar across the options ranging between €827 and €963 per
substance per DU under the options and €850 under the baseline. The more significant factor
governing the costs of the options and the baseline is the number of substances withdrawn (and
hence number of products that will need to be re-formulated). As there may be more than one
ix
withdrawn substance in each DU product for re-formulation, however, it cannot be assumed that
each substance withdrawn equals one product reformulated. I.e. there will be some overlap but the
extent of this overlap is not known.
5.2.3 Impact of registration on manufacturers and importers (MIs)
Table 6 provides the average cost of substance registration for companies of each size category.
These costs are averaged out across all of the substances in the portfolios of each of the companies
registering in the simulation and so provide information on the magnitude of costs absorbed for
every substance registered.
Table 6: Average costs of substance registration for MIs
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
Average cost of registering a substance (across all substances in company portfolios)
Micro companies
€ 2,370
€ 3,104
€ 4,418
€ 3,174
€ 4,541
€ 4,142
Small Companies
€ 2,450
€ 3,154
€ 4,407
€ 3,224
€ 4,536
€ 4,172
Medium Companies
€ 2,596
€ 3,280
€ 4,396
€ 3,342
€ 4,511
€ 4,337
Large Companies
€ 2,230
€ 2,568
€ 3,184
€ 2,630
€ 3,319
€ 3,951
Total
€ 2,401
€ 3,112
€ 4,374
€ 3,181
€ 4,499
€ 4,159
5.2.4 Impact of registration on downstream users (DUs)
In terms of the impacts of registration costs on individual DUs through price rises, little is known
about the numbers of downstream users other than, despite the low tonnages involved, there may
be several on average, each using low volumes of the substances.
An estimate has been made on the cost of each option to individual downstream users. This
suggests that average price increases per substance per DU are fairly low and are similar across the
options ranging between €73 and €100 per substance per DU under the options and €57 under the
baseline.
x
6.
Benefits
6.1
Numbers of hazardous substances and properties identified
The five options aim to generate more and better information in particular on:





Carcinogenicity, mutagenicity and reprotoxicity;
Dermal, inhalation and/or oral toxicity;
Long term toxicity;
Aquatic toxicity; and
Persistence, bioaccumulation and toxicity.
In some cases, better information on short term toxicity, long term toxicity and aquatic toxicity will
lead to the identification of:



Substances for which there is better information on dermal/inhalation exposure limits;
Substances identified with classification from STOT RE 1 or 2; and
Number of aquatic toxic substances with enough information for PNEC where applicable.
Figure 1 presents the number of substances with the above hazard category classifications identified
under the options and the total costs for each option.
6.2
Impact of the Options on Damage Costs
6.2.1 Approach
A full economic analysis of the economic benefits of identifying additional substances and hazardous
properties would require exposure-response functions for each chemical substance and for each
human health and environmental effect. In addition, information on the population/area exposed
would also be required to enable the prediction of economic value of damages avoided. To be
strictly rigorous, such an analysis would also require consideration of the distribution of the benefits
over time and selection of an appropriate discount rate.
xi
Figure 1: Total costs (€ million) and number of substances identified per hazard categories
xii
As detailed information of this kind does not currently exist, as with the Commission’s 2003
Extended Impact Assessment, an illustrative benefits approach must be employed to explore the
benefits of the options and, therein, the relative performance of the options (and the baseline). In
overview, this approach has involved:

considering how many hazardous substances with different properties for classification are
identified under the options and under the baseline (as in Figure 1);

considering the nature of disorders, diseases and impacts associated with substances with
such classifications;

identifying an appropriate economic metric for a single case avoided or unit of
environmental area improved for each type of substance classification identified (in €s);

applying conservative assumptions concerning the numbers of cases avoided/environmental
area improved per substance classification identified over a 30 year period following
registration4; and

combining the above to calculate conservative illustrative benefits (in €s) for each of the
options, the baseline and also the total human health and environmental damages that
could be avoided if all hazardous substances were identified. The latter can be calculated by
considering the total number of hazardous substances/properties that are (as yet)
unidentified.
6.2.2 Costs versus Damage costs avoided
Table 7 provides the total costs, benefits and benefit:cost ratios for all options for changing
information requirements. The table also provides a verbal summary of the changes as well as
information on:


the residual damage costs under the option/baseline – which is simply the avoidable
damage costs less the damage costs avoided under the option/baseline from the total; and
impact on avoidable damage costs – which is simply the damage costs avoided under the
option/baseline expressed as a percentage of the total avoidable damage costs.
Benefit to Cost Ratios
Benefit:cost ratios provide an indication of the performance of an option in economic terms. Where
the ratio is greater than one the benefits (in terms of damage costs avoided) outweigh the financial
costs (meaning that the action is justified in economic terms). The larger the benefit:cost ratio, the
more justifiable the option is in economic terms.
The benefits in this case are expressed in terms of damage costs avoided and are calculated on the
basis of the avoidance of one incidence of ‘disease’ per year per substance identified with a human
health classification and improvement in 1km of waterbody for every substance identified with a
classification for aquatic toxicity5. Comparison of the benefit:cost ratios with recent information on
4
Where 30 years is consistent with the illustrative benefits approach used in the Commissions Extended
Impact Assessment of 2003.
5
Note: not one per year
xiii
the costs and benefits of environmental regulation (Defra 20156) suggests that the metric applied to
calculate the benefits provides a reasonable approximation of reality (even if perhaps an
underestimate of the true benefits).
Throughout the whole estimation of costs and benefits, the same data and assumptions have been
applied equally across all of the options and the baseline. Thus, whilst benefit:cost ratios for each
option would be different with different assumptions for the number of health/environment cases
avoided, the relative performance of each option is unlikely to change significantly (any changes
would affect the benefit:cost ratios equally).
Examination of the benefit:cost ratios provided in Table 8 leads to a number of observations:

despite the large variation in the magnitude of costs, the benefit:cost ratios suggest that all
options are justified in economic terms – in other words, for all options the value of the
benefits (expressed in €s) significantly exceeds the costs;

the current requirements perform very slightly better than the other options, providing (at
least) €10.02 of benefits for every €1.00 of cost. However, this is only €0.57 more than the
benefits from the next best performing option in economic terms (the increased Annex VII+
information combined with removal of the diffuse/dispersive use criterion in Annex III);

the ‘worst’ performing options include those where the current Annex VII requirements are
retained. Again, however, these perform only slightly worse than the baseline; and

the variation between benefit:cost ratios is relatively very small. As such no option performs
significantly better or significantly worse than another option (including the baseline).
On the basis of these observations, no firm conclusions can be drawn concerning the ‘best’ option
in economic terms. In short, within the scope of the options considered, an increase in cost
provides a roughly proportionate increase in benefit in terms of damage costs avoided. There is no
significant difference between the options in terms of benefit:cost ratios (particularly considering
the uncertainties inherent in the estimation of both costs and benefits).
6
Defra (2015): Emerging Findings from Defra’s Regulation Assessment - First update covering 2012 see
https://www.gov.uk/government/publications/the-costs-and-benefits-of-defra-s-regulations
xiv
Table 7: Summary table of the PV Costs and Benefits of the Options and Impact on Avoidable Damage Costs
Changes brought about under different options for information
requirements
Current Annex III
Current
Ann. VII
Current
Ann. VII
Removal of the
diffuse/dispersive
use criterion in
Annex III
Ann. VII+
Information
Ann. VII++
Information
Current
Ann. VII
Removal of
Annex III
Ann. VII+
Information
There are no changes to the information
in Annex VII and Annex III remains the
same
There are no changes in the information
required in Annex VII but changes to
Annex III act to increase the number of
substances required to submit full tox
and ecotox information
There are slight increases in the tox and
ecotox information in Annex VII and
changes to Annex III act to increase the
number of substances required to
submit that tox and ecotox information
There are more significant increases in
the tox and ecotox information in Annex
VII and changes to Annex III act to
increase the number of substances
required to submit that tox and ecotox
information
There are no changes in the information
required in Annex VII but removing
Annex III means that all substances are
required to submit full tox and ecotox
information
There are slight increases in the tox and
ecotox information in Annex VII but
removing Annex III means that all
substances are required to submit full
tox and ecotox information.
Cost
(€m)
Benefit
(€m)
B/C
ratio
Rank B/C
ratio
Residual
damages
(€m)
Percentage of
total damage
costs avoided
Rank Impact
on damage
costs
€ 525.2
€ 5,263
10.02
1
€ 11,962
31%
6
€ 693.8
€ 6,312
9.10
4
€ 10,913
37%
5
€ 713.8
€ 6,673
9.35
3
€ 10,552
39%
4
€ 1,236.3
€ 11,685
9.45
2
€ 5,540
68%
1
€ 977.4
€ 8,559
8.76
6
€ 8,666
50%
3
€ 1,012.8
€ 9,041
8.93
5
€ 8,184
52%
2
xv
Impact on damage costs
Whilst comparison of benefit:cost ratios does not reveal any clear differences between the options
or the baseline, comparison of the PV damage costs avoided for each option with the total PV
avoidable damage costs (€17,225 million) reveals significant differences between the options.
if economic performance (in terms of benefits versus costs) and impact on damage costs were the
only factors to consider in selecting the appropriate option, the rank order of preference would be
that dictated by the level of impact on the total damage costs in Table 8 below.
8.2: Impact of options on total avoidable damage costs
Rank
Option
Annex VII++ - No Diffuse/
Dispersive Use Criterion in Annex III
Annex VII+ - No Annex III
1
2
3
Annex VII - No Annex III
Annex VII+ - No Diffuse/ Dispersive
Use Criterion in Annex III
Annex VII - No Diffuse/ Dispersive
Use Criterion in Annex III
Baseline
4
5
6
Cost (€m
PV)
Damage
Costs
Avoided
(€m PV)
Impact on
avoidable damage
costs (% of total
damage costs
avoided)
Residual
damages (€m
PV)
€ 1,236.3
€ 11,685.0
68%
€ 5,540.0
€ 1,012.8
€ 9,040.8
52%
€ 8,184.2
€ 977.4
€ 8,558.6
50%
€ 8,666.3
€ 713.8
€ 6,673.1
39%
€ 10,551.8
€ 693.8
€ 6,312.2
37%
€ 10,912.8
€ 525.2
€ 5,262.7
31%
€ 11,962.2
6.2.3 Impacts on competition and innovation
Impact on damage costs is not, however, the only deciding factor when selecting the most
appropriate option in terms of the combination of Annex III requirements and toxicological and
ecotoxicological information for 1-10t substances. Perhaps unfortunately, the decision is more
complicated because which option is ‘best’ depends on:


what level of residual damages are ‘acceptable’?
what level of burden on the chemical industry is sustainable?
Neither of these can be robustly quantified and both, to a greater or lesser extent, will vary
depending on who is asked. Whilst further consideration of these issues can be informed by the
quantitative and qualitative information on business impacts (such as that provided in Section 6), it
is not possible to make any firm conclusions on the acceptability or sustainability of the options.
This means that the study can make no firm conclusions or recommendations on which option is
‘best’ or most appropriate and the final decision on which option should be adopted must be
made by other means (considering the information provided on business impacts).
Section 6 of the main report provides detailed information on business impacts of the options
including on innovation and competitiveness. In terms of competitiveness, the general conclusions
that can be drawn are that all the options considered increase registration costs and lead to
withdrawal levels above the baseline position. The impact of higher costs on company
competitiveness and survival will vary significantly depending on the sub-sectors in question.
xvi
As costs of the different options increase, it is also probable that impacts on the competitiveness of
smaller firms will be more negatively affected than larger ones. This is due to the probability that
smaller firms are more dependent on low volume substances than their large counterparts, and also
because they tend to have fewer resources available to adjust to changes in competitiveness
brought about by changes in legislation and especially those leading to higher cost levels.
As regards innovation, the consequences of moving towards higher information and higher cost
options in these low volume substances are somewhat more indeterminate. The extent to which
businesses will invest in various approaches depends on cost/ profits/ risk calculations. These vary
by the innovations in question (e.g. reformulation with an existing substance/ developing a new
substance/ changing the product so that the substance is no longer needed), the size of the market
in question and the value of the relevant substances, and risks, which in the present economic
environment in the EU are quite high and would discourage innovation unless outcomes are quite
high and certain.
Again, higher value added substances would tend to be able to justify more expensive innovation
costs, and larger firms would be more likely to dispose over the required resources if innovation was
the option decided upon.
6.2.4 The missing option
Anticipating that there will be further deliberations within the Commission concerning which option
is most appropriate, it seems inevitable that there will be a question as to the merits of a sixth
option. This would entail maintaining the current Annex III requirements (as in the baseline) but
increasing the toxicological and ecotoxicological information requirements slightly to match those of
the Annex VII+ option.
The specification for this study limited consideration to the five options and the baseline (as
presented throughout the report) and so this option has not been examined in detail. However,
using data from the other options it is estimated that extending Annex VII information requirements
to match the Annex VII+ information requirements would increase costs by around 3% and benefits
by around 6%. The estimated costs and benefits of this missing option are provided in Table 9.
Table 9: Estimated PV costs and benefits of increasing only the information requirements
Cost (€m)
Benefit (€m)
Residual
B/C
Impact (% of total
damages
ratio
damage costs
(€m)
avoided)
Current Annex III and Annex VII
information requirements (the
€ 525.20
€ 5,262.7
€ 11,962.2
10.02
31%
baseline)
Current Annex III and extended
Annex VII+ information
€ 540.34
€ 5,563.6
€ 11,661.3
10.30
32%
requirements
Comparison of the benefits and costs of this missing option with the baseline suggest a slightly
higher benefit:cost ratio (10.3) compared with the baseline (10.02) making it the only option likely to
perform better than the baseline in purely economic efficiency terms. However, this is only very
slightly better and the difference between this missing option and the baseline (or the other options)
cannot be considered significant.
xvii
In other words, extending the information requirements in Annex VII slightly (to match the Annex
VII+ option) but leaving the Annex III requirements as at present would deliver an estimated
minimum additional benefit of €301 million compared with the baseline. This would cost an
estimated additional €15.1 million across all 20,000 1-10t substances (an increase in costs of around
€757 or 3% per substance on average) compared with the baseline. This is equivalent to an average
increase in costs per MI of €172 per substance. When compared with the baseline (current
requirements) the impacts on innovation and competitiveness of this option are likely to be so small
as to be indistinguishable from the baseline but the benefits may be significant.
Reproducing and updating Table 7, Table 10 provides a summary table for all options including the
‘missing’ option.
xviii
Table 10: Summary table of the PV Costs and Benefits of the Options and Impact on Avoidable Damage Costs
Changes brought about under different options for information requirements
Current Ann.
VII
Current Annex III
Ann. VII+
Information*
Current Ann.
VII
Removal of the
diffuse/dispersive
use criterion in
Annex III
Ann. VII+
Information
Ann. VII++
Information
Current Ann.
VII
Removal of Annex
III
Ann. VII+
Information
There are no changes to the information in
Annex VII and Annex III remains the same
There are slight increases in the tox and
ecotox information in Annex VII and no
changes to Annex III
There are no changes in the information
required in Annex VII but changes to
Annex III act to increase the number of
substances required to submit full tox and
ecotox information
There are slight increases in the tox and
ecotox information in Annex VII and
changes to Annex III act to increase the
number of substances required to submit
that tox and ecotox information
There are more significant increases in the
tox and ecotox information in Annex VII
and changes to Annex III act to increase
the number of substances required to
submit that tox and ecotox information
There are no changes in the information
required in Annex VII but removing Annex
III means that all substances are required
to submit full tox and ecotox information
There are slight increases in the tox and
ecotox information in Annex VII but
removing Annex III means that all
substances are required to submit full tox
and ecotox information.
Cost (€m)
Benefit
(€m)
B/C
ratio
Rank B/C
ratio
Residual
damages
(€m)
Percentage of
total damage
costs avoided
Rank Impact
on damage
costs
€ 525.2
€ 5,263
10.02
2
€ 11,962
31%
7
€ 540.3
€ 5,564
10.30
1
€ 11,661
32%
6
€ 693.8
€ 6,312
9.10
5
€ 10,913
37%
5
€ 713.8
€ 6,673
9.35
4
€ 10,552
39%
4
€ 1,236.3
€ 11,685
9.45
3
€ 5,540
68%
1
€ 977.4
€ 8,559
8.76
7
€ 8,666
50%
3
€ 1,012.8
€ 9,041
8.93
6
€ 8,184
52%
2
*Imputed values
xix
xx
1 Introduction
1.1 Study Objectives
Regulation (EC) No. 1907/2006 concerning the Registration, Evaluation, Authorisation and
Restriction of Chemicals (REACH) came into force on 1 June 2007. REACH aims to provide a high
level of protection of human health and the environment, while at the same time enhancing the
competitiveness and innovative capability of the EU industry. Furthermore, REACH aims to ensure
the free movement of substances and the promotion of the development of alternative methods for
the assessment of hazards of substances (Article 1).
Registration under REACH is staged over three phases with the timescales for registration dependent
upon the quantities of substances manufactured or imported. The final phase-in registration
deadline will be 1 June 2018 for substances manufactured or imported in quantities starting at 1
tonne but less than 10 tonnes per year per manufacturer or importer (1 to 10 tonne substances) and
also for substances manufactured or imported in quantities of 10-100 tonnes per year.
In relation to the 1-10t substances, Article 138(3) of REACH identifies that the Commission may
present legislative proposals to modify the information requirements for substances registered in
the 1-10t band (see Box 1.1). The Commission has contracted RPA and CSES to provide technical,
scientific and policy support in order for it to decide on the appropriateness of proposing changes to
the information requirements for these substances and develop its proposal accordingly.
Box 1.1: REACH Article 138(3) on Modifying Information Requirements
Article 138(3)
“The report, referred to in Article 117(4), on the experience acquired with the operation of this Regulation
shall include a review of the requirements relating to registration of substances manufactured or imported
only in quantities starting at 1 tonne but less than 10 tonnes per year per manufacturer or importer. On the
basis of that review, the Commission may present legislative proposals to modify the information
requirements for substances manufactured or imported in quantities of 1 tonne or more up to 10 tonnes per
year per manufacturer or importer, taking into account the latest development, for example in relation to
alternative testing and (quantitative) structure-activity relationships ((Q)SARs).”
The specific study objectives can be summarised as to:



provide the Commission with a solid basis to report on this issue and to envisage any
(legislative) proposal;
identify, refine and analyse a more limited number of options [than the Phase 1 study
conducted by RPA on this topic] for an extension of the current information requirements.
These should be refined and further assessed with the primary objective of allowing the
identification of hazardous substances for the purpose of ensuring proper risk management;
and
provide the Commission with sufficient information on the impact on innovation and
competitiveness of a proposal for changes in the information requirements for substances
produced in low tonnages.
REACH 1 to 10 t Phase 2
RPA & CSES | 1
1.2 Structure of the Report
Section 2 provides an overview of the current requirements under REACH in relation to the 1-10t
substances considering information to be submitted in registration dossiers, duties to communicate
information in the supply chain and compliance with parallel regulation.
Section 3 discusses the options available for increasing information requirements, setting out five
options for further analysis (with detailed reasoning provided as Annex 1).
Section 4 describes the development of the modelling and simulation approach which has been
applied to analyse the relative costs and benefits of the options and the effect on companies’
registration costs. For the benefit of transparency, the approach, data and use of data at each point
has been described in full in Annex 2.
Sections 5, 6 and 7 present the costs, business impacts and benefits of options. Section 8 provides
conclusions on the basis of costs and benefits and impact on damage costs.
REACH 1 to 10 t Phase 2
RPA & CSES | 2
2 Current Requirements under REACH for 1-10t Substances
2.1 Overview of Requirements
This section briefly sets out the current requirements in relation to the registration of 1-10t
substances under REACH. The term substances here refers to substances used on their own or in
mixtures (as defined in Article 3 of REACH) and also in articles where the substance is used in
quantities of 1 tonne or more and the substance is intended to be released under normal or
reasonably foreseeable conditions of use7.
The general information requirements for 1-10t substances are established in Articles 10 and 12 of
REACH. These establish what information must be provided in the registration dossier.
Article 31 of REACH also requires the supplier of a substance or a mixture to provide the recipient
with a safety data sheet (SDS) compiled in accordance with the detailed requirements in Annex II.
The SDS must reflect any new or updated classifications (or any other information of relevance) that
are the result of gathering the information required under Articles 10 and 11.
For the 1-10t substances, the SDSs are the key means by which appropriate risk controls are
communicated to downstream users and others. Here, any changes in the classification of a
substance in accordance with the Classification, Labelling and Packaging (CLP) Regulation (EC) No
1272/2008, will be reflected in the Classification and Labelling Inventory (CLI) as well as in the SDS
supplied to downstream users and others. Certain changes in classification then trigger actions on
the part of manufacturers, importers and downstream to implement risk controls to comply with
other pieces of community regulation.
It should be noted that the mechanism for identifying, communicating and controlling hazards and
risks for the 1-10t substances differs from that applied to substances registered in quantities
exceeding 10t per year. For the latter, the identification of risks and adequate risk control for each
use of a substance is achieved by undertaking a Chemical Safety Assessment (CSA). CSA involves
environmental and human health hazard assessment, PBT/vPvB assessment and, for certain
classifications, an exposure assessment and risk characterisation for each use leading to the
derivation of recommended risk management measures. This is all summarised in a Chemical Safety
report (CSR) and, as well as changes in classification, is communicated to downstream users by
means of extended Safety Data Sheets (eSDS) which include the relevant exposure scenario drawn
7
In relation to the latter (substances in articles >1t intended to be released), these uses can be considered
alongside substances used on their own and in mixtures because, under Article 7 of REACH, manufacturers
and importers of such articles would have to complete a registration for the substance and its use if the use
in the articles is not already registered. Here, the registration and the information requirements in
relation to quantities manufactured or imported per producer are identical to those for the equivalent
substance (on its own or part of a mixture) because Article 12(3) identifies that the Article “shall apply to
producers of articles adapted as necessary”. As such, one way or the other, the use of substances in
articles where the substance is used in quantities of 1 tonne or more and the substance is intended to be
released under normal or reasonably foreseeable conditions of use must be registered.
REACH 1 to 10 t Phase 2
RPA & CSES | 3
from the Chemical Safety Report (CSR) as an appendix to the eSDS. As noted, this CSA process does
not apply to the 1-10t substances8.
The following sub-sections set out requirements for 1-10t substances considering:



Registration dossier requirements; and
Communication of information in the supply chain; and
Compliance with parallel regulation triggered by the REACH registration process.
2.2 Registration Dossier Information Requirements
2.2.1 Article 10 - Information Submitted for General Registration Purposes
The general information required in technical registration dossiers of substances (on their own and,
as mixtures or in articles) is set out in Article 10(a) of REACH. This identifies eleven information
elements (i to xi) that all technical dossiers “shall include”, where the exact requirements in relation
to each are expanded upon in Annex VI.
Article 10(a) points (i) and (ii) simply set out information on the identity of the manufacturer or
importer and that of the substance.
Article 10(a) points (iii), (iv), (v) and (x) set out requirements in relation to information manufacture
and uses; classification and labelling; guidance on safe use; and exposure information required for
substances manufactured in quantities of 1-10t. These points, and the more detailed information on
requirements set out in Annex VI, are summarised in Table 2.1.
Table 2.1: Annex VI information Requirements
Article 10(a)
Annex VI
(iii)
information
on
the 3.1. Overall manufacture, quantities used for production of an article that
manufacture and use(s) of the is subject to registration, and/or imports in tonnes per registrant per year
substance as specified in section in: the calendar year of the registration (estimated quantity)
3 of Annex VI; this information 3.2. In the case of a manufacturer or producer of articles: brief description
shall represent all the registrant's of the technological process used in manufacture or production of articles.
identified
use(s).
This Precise details of the process, particularly those of a commercially
information may include, if the sensitive nature, are not required.
registrant deems appropriate, 3.3. An indication of the tonnage used for his own use(s)
the relevant use and exposure 3.4. Form (substance, mixture or article) and/or physical state under which
categories;
the substance is made available to downstream users. Concentration or
concentration range of the substance in mixtures made available to
downstream users and quantities of the substance in articles made
available to downstream users.
3.5. Brief general description of the identified use(s)
3.6. Information on waste quantities and composition of waste resulting
from manufacture of the substance, the use in articles and identified uses
3.7. Uses advised against (see Section 1 of the safety data sheet)
Where applicable, an indication of the uses which the registrant advises
8
Although the extension of the requirements to substances classified as C, M or R 1A or 1B is being reviewed
by the Commission based on Art. 138(1).
REACH 1 to 10 t Phase 2
RPA & CSES | 4
against and why (i.e. non-statutory recommendations by supplier). This
need not be an exhaustive list.
(iv) the classification and 4.1 The hazard classification of the substance(s), resulting from the
labelling of the substance as application of Title I and II of Regulation (EC) No 1272/2008 for all hazard
specified in section 4 of Annex classes and categories in that Regulation, In addition, for each entry, the
VI;
reasons why no classification is given for a hazard class or differentiation
of a hazard class should be provided (i.e. if data are lacking, inconclusive,
or conclusive but not sufficient for classification),
4.2 The resulting hazard label for the substance(s), resulting from the
application of Title III of Regulation (EC) No 1272/2008,
4.3 Specific concentration limits, where applicable, resulting from the
application of Article 10 of Regulation (EC) No 1272/2008 and Articles 4 to
7 of Directive 1999/45/EC.
(v) guidance on safe use of the This information shall be consistent with that in the Safety Data Sheet,
substance as specified in Section where such a Safety Data Sheet is required according to Article 31.
5 of Annex VI;
5.1. First-aid measures (Safety Data Sheet heading 4)
5.2. Fire-fighting measures (Safety Data Sheet heading 5)
5.3. Accidental release measures (Safety Data Sheet heading 6)
5.4. Handling and storage (Safety Data Sheet heading 7)
5.5. Transport information (Safety Data Sheet heading 14)
Where a Chemical Safety Report is not required, the following additional
information is required:
5.6. Exposure controls/personal protection (Safety Data Sheet heading 8)
5.7. Stability and reactivity (Safety Data Sheet heading 10)
5.8. Disposal considerations
5.8.1. Disposal considerations (Safety Data Sheet heading 13)
5.8.2. Information on recycling and methods of disposal for industry
5.8.3. Information on recycling and methods of disposal for the public.
(x) for substances in quantities of 6.1. Main use category:
1 to 10 tonnes, exposure 6.1.1. (a) industrial use; and/or (b) professional use; and/or (c) consumer
information as specified in use.
section 6 of Annex VI;
6.1.2. Specification for industrial and professional use: (a) used in closed
system; and/or (b) use resulting in inclusion into or onto matrix; and/or (c)
non-dispersive use; and/or (d) dispersive use.
6.2. Significant route(s) of exposure:
6.2.1. Human exposure: (a) oral; and/or (b) dermal; and/or (c) inhalatory.
6.2.2. Environmental exposure: (a) water; and/or (b) air; and/or (c) solid
waste; and/or (d) soil.
6.3. Pattern of exposure: (a) accidental/infrequent; and/or (b) occasional;
and/or (c) continuous/frequent.
The remaining points refer to (vi) the provision of study summaries for information derived by the
application of Annexes VII to XI (vi); (vii) robust study summaries in cases where one is required by
Annex I requirements for CSAs (which do not apply to 1-10t substances); (viii) an indication as to the
appropriate experience of assessors; (ix) proposals for testing for test endpoints listed in Annexes IX
and X; and (xi) concerning the availability of information on the internet.
As such, most of these points mainly refer to the information to be submitted depending on tonnage
(discussed below).
Article 10 also establishes the requirement to undertake a Chemical Safety Assessment (CSA) and
submit a Chemical Safety Report (CSR) when one is required under Article 14. As noted above, these
REACH 1 to 10 t Phase 2
RPA & CSES | 5
CSA/CSR requirements only apply to substances registered in quantities of 10 tonnes or more and
hence do not apply to the 1-10t substances that are the subject of this study9.
2.2.2 Article 12 - Information to be Submitted Depending on Tonnage
The information to be submitted depending on tonnage is defined in Article 12 of the Regulation in
combination with the Annex relevant to the tonnage band; Annex VII in the case of the 1-10t
substances. Annex VII is, itself, divided into two types of information:


information on physicochemical properties – where this is required for all 1-10t substances;
information on toxicological and ecotoxicological properties – where this is only required
for certain types of 1-10t substances.
Physico-chemical Information to be submitted
The physicochemical information that must be provided for all substances (including 1-10t
substances) is summarised in Table 2.2.
Table 2.2: Physico-chemical Information Requirements in Annex VII
1
Physicochemical
Adaptations to Requirements
Endpoints
7.1 Physical state of None specified
substance
(at 20 °C and 101.3 kPa)
7.2 Melting/ freezing Only above -20 °C
point
7.3 Boiling point
Not required for gases or for solids that melt above 300 °C or any substance
which decomposes before boiling. Boiling point at reduced pressure may be
used
7.4 Relative density
Where the substance is only stable in solution in a particular solvent and the
solution density is similar to that of the solvent, an indication of whether the
solution density is higher or lower than the solvent density is sufficient.
For gases, an estimation is required based on molecular weight and the Ideal
Gas Laws
7.5 Vapour pressure
Not required for solids that melt above 300 °C (if between 200 °C and 300 °C, a
limit value based on measurement or a recognised calculation method is
sufficient)
7.6 Surface tension
Not required where water solubility is below 1 mg/l at 20 °C, otherwise only
when:
 based on structure, surface activity is expected or can be predicted; or
 surface activity is a desired property of the material
7.7 Water solubility
Not required if hydrolytically unstable at pH 4.7 and 9 (half-life < 12 hours) or
readily oxidises in water.
Insoluble substances require a limit test up to the analytical detection limit
7.8 Partition coefficient
Not required for inorganic substances. Calculated log P may be provided where
(at least n-octanol/ water direct measurement cannot be performed
ratio)
9
Although the extension of the requirements to substances classified as C, M or R 1A or 1B is being reviewed
by the Commission based on Art. 138(1).
REACH 1 to 10 t Phase 2
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7.9 Flash-point
7.10 Flammability
7.11 Explosive properties
7.12
Self-ignition
temperature
7.13 Oxidising properties
Not required for inorganic substances, or where:
 the substance only contains volatile organic components with flash-points
above 100 °C for aqueous solutions, or
 the estimated flash-point is above 200 °C, or
 the flash-point can be accurately predicted by interpolation from existing
characterised materials
Not required for solids that are explosive, pyrophoric or spontaneously ignite
when in contact with air. Also not for gases if the concentration of the
flammable gas in a mixture with inert gases is so low that, when mixed with air,
the concentration is all times below the lower limit or for substances which
spontaneously ignite in contact with air
Not required where:
 there are no chemical groups associated with explosive properties present in
the molecule;
 the substance contains chemical groups associated with explosive properties
which include oxygen and the calculated oxygen balance is less than -200;
 an organic substance or a homogenous mixture of organic substances
contains chemical groups associated with explosive properties but the
exothermic decomposition energy is less than 500 J/g and the onset of
exothermic decomposition is below 500 °C; or
 a mixture of inorganic oxidising substances (UN Division 5.1) with organic
materials, the concentration of the inorganic oxidising substance is: less than
15 %, by mass if assigned to UN Packaging Group I (high hazard) or II (medium
hazard); or less than 30 %, by mass if assigned to UN Packaging Group III (low
hazard).
Neither a test for propagation of detonation, nor a test for sensitivity to
detonative shock, is required if the exothermic decomposition energy of organic
materials is less than 800 J/g
Not required where:
 the substance is explosive or ignites spontaneously with air at room
temperature;
 a liquid is non-flammable in air, e.g. no flash point up to 200 °C
 a gas has no flammable range; or
 a solid has a melting point ≤ 160 °C, or if preliminary results exclude selfheating of the substance up to 400 °C
Not required where the substance is:
 explosive;
 highly flammable;
 an organic peroxide;
 is incapable of reacting exothermically with combustible materials, for
example on the basis of the chemical structure; or
 a solid if the preliminary test clearly indicates that the test substance has
oxidising properties.
Note that as there is no test method to determine the oxidising properties of
gaseous mixtures, the evaluation of these properties must be realised by an
estimation method based on the comparison of the oxidising potential of gases
in a mixture with that of the oxidising potential of oxygen in air
7.14 Granulometry
Only for substances marketed in solid or granular form
Note 1: Where these conditions are met, the registrant must clearly state this fact and the reasons justifying
this statement
REACH 1 to 10 t Phase 2
RPA & CSES | 7
Toxicological and Ecotoxicological Information to be Submitted
For those substances where little or no toxicological and/or ecotoxicological information exists at
present, the gathering of the information required for these endpoints in Annex VII is crucial to the
identification of hazardous properties that are, as yet, unknown and the implementation and
communication of appropriate controls via CLP, the Safety Data Sheets (SDS) and the CLI.
As noted above, information on toxicological and ecotoxicological properties in Annex VII is,
however, only required for certain types of 1-10t substances where these are defined in Article 12 of
REACH in combination with Annex III.
Here, Article 12 identifies that the technical dossier:
“shall include all physicochemical, toxicological and ecotoxicological information that is relevant and
available to the registrant and as a minimum the following:
a) the information specified in Annex VII for non-phase-in substances, and for phase-in
substances meeting one or both of the criteria specified in Annex III, manufactured or
imported in quantities of one tonne or more per year per manufacturer or importer;
b) the information on physicochemical properties specified in Annex VII, section 7 for phase-in
substances manufactured or imported in quantities of one tonne or more per year per
manufacturer or importer which do not meet either of the criteria specified in Annex III.”
The criteria in Annex III (as amended10 ) referred to in Article 12 (and which trigger the need to
provide information on all the Annex VII endpoints11 ) are:
"(a) substances for which it is predicted (i.e. by the application of (Q)SARs or other evidence) that
they are likely to meet the criteria for category 1A or 1B classification in the hazard classes
carcinogenicity, germ cell mutagenicity or reproductive toxicity or the criteria in Annex XIII;
(b) substances:
iii.
with dispersive or diffuse use(s) particularly where such substances are used in
consumer mixtures or incorporated into consumer articles; and
iv.
for which it is predicted (i.e. by application of (Q)SARs or other evidence) that they
are likely to meet the classification criteria for any health or environmental hazard
classes or differentiations under Regulation (EC) No 1272/2008”.
10
Regulation (EC) No 1272/2008 of the European Parliament and of the Council of 16 December 2008 on
classification, labelling and packaging of substances and mixtures, amending and repealing Directives
67/548/EEC and 1999/45/EC, and amending Regulation (EC) No 1907/2006 (Text with EEA relevance) Official Journal L 353 , 31/12/2008 P. 0001 - 1355
11
And in this case, further testing may then be required to fulfil the data gaps; where animal testing is
required to meet Annex VII a testing proposal would be submitted to ECHA.
REACH 1 to 10 t Phase 2
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The effect of Article 12 (making reference to Annex III) is that it divides the 1-10t substances into
those that:

are required only to provide the physico-chemical information in Annex VII (as outlined
earlier); and

in addition to the physico-chemical information (outlined earlier), are required to provide
information on the human health and environmental endpoints according to Annex VII.
Figure 2.1 summarises the effect of Article 12 in combination with Annex III in terms of the
substances which do and do not need to provide toxicological and ecotoxicological information in
their registration dossiers. Table 2.3 provides a summary of the toxicological and ecotoxicological
information required under Annex VII for substances registered only in the 1-10t band.
Substance should already be
registered
Substances with a C, M, or R 1A/1B Classification
Yes
Article 23(1) (a) of REACH requires that all phasein CMRs 1A/1B (either for which there is already
a harmonised classification or self-classified)
above 1tpa and all phase-in R50/53 above 100
tpa) had to be registered by 1 December 2010.
No
Substances for which it is predicted by the application of
(Q)SARs or other evidence that they are likely to meet
classification as C, M, or R 1A/1B or PBT/vPvB
Yes
Registration requires Annex VII
Toxicological and Ecotoxicological
Data
No
Substances with a dispersive/diffuse use
No
Data on Annex VII toxicological and
ecotoxicological endpoints identifies
appropriate classifications?
Yes
Substances which meet or are predicted by the application of
(Q)SARs or other evidence that they are likely to meet, any
human health or environmental classification
Yes
No
Yes
Registration only requires data on physicochemical endpoints in Annex VII
Classifications communicated in
SDS and CLP/CLI
No additional human health or environmental
classifications identified
Figure 2.1: Information Required for Substances Registered only in the 1-10t band
REACH 1 to 10 t Phase 2
RPA & CSES | 9
Table 2.3: Toxicological and Ecotoxicological Information Requirements in Annex VII
Endpoints
Requirements
Adaptations to Requirements
Human Health Endpoints (Mammalian Toxicology)
8.1 Skin irritation
Following consecutive steps:
Steps 3 and 4 is not need where:
/skin corrosion
(1) an assessment of the available 1) and 2) indicates classification as corrosive to
human and animal data;
the skin or irritating to eyes;
(2) an assessment of the acid or the substance is flammable in air at room
alkaline reserve;
temperature;
(3) in vitro study for skin corrosion; the substance is classified as very toxic in
and
contact with skin; or
(4) in vitro study for skin irritation
an acute toxicity study by the dermal route
does not indicate skin irritation up to the limit
dose level
8.2 Eye irritation
Following consecutive steps:
Step 3 is not need where:
(1) an assessment of the available 1) and 2) indicates classification as corrosive to
human and animal data;
the skin or irritating to eyes; or
(2) an assessment of the acid or the substance is flammable in air at room
alkaline reserve; and
temperature
(3) in vitro study for eye irritation
8.3 Skin
Following consecutive steps:
Step 2 is not need where:
sensitisation
(1) an assessment of the available (1)
the available information indicates
human, animal and alternative classification for skin sensitisation or
data;
corrosivity;
(2) In vivo testing (The Murine (2) the substance is a strong acid (pH ≤ 2,0) or
Local Lymph Node Assay (LLNA) is base (pH ≥ 11,5); or
the first-choice method for in vivo the substance is flammable in air at room
testing
temperature
8.4 Mutagenicity
8.4.1. In vitro gene mutation study Further testing shall be considered in case of a
in bacteria
positive result
8.5 Acute toxicity
8.5.1. By oral route
Not required where:
the substance is classified as corrosive to the
skin; or
a study on acute toxicity by the inhalation route
(8.5.2) is available (requirement for 10 to 100
tonne substances)
Environmental Endpoints (Ecotoxicology)
9.1 Aquatic toxicity 9.1.1.
Short-term toxicity 9.1.1. Not required where:
testing
on
invertebrates there are mitigating factors indicating that aquatic
(preferred species Daphnia)
toxicity is unlikely to occur, e.g. substance is highly
insoluble in water or the substance is unlikely to
cross biological membranes;
a long-term aquatic toxicity study on invertebrates is
available; or
adequate
information
for
environmental
classification and labelling is available.
Long-term toxicity testing may be considered instead
of 9.1.1. The long-term aquatic toxicity study on
Daphnia (Annex IX, section 9.1.5) is considered if the
substance is poorly water soluble
REACH 1 to 10 t Phase 2
RPA & CSES | 10
Table 2.3: Toxicological and Ecotoxicological Information Requirements in Annex VII
Endpoints
Requirements
Adaptations to Requirements
9.1.2. Growth inhibition study 9.1.2. Not required where there are mitigating
aquatic
plants
(algae factors indicating that aquatic toxicity is unlikely to
preferred)
occur e.g. substance is highly insoluble in water or
the substance is unlikely to cross biological
membranes
9.2 Degradation
9.2.1 Biotic/ 9.2.1.1. Ready Not required for inorganic substances
biodegradability
In addition to this basic set of information, the Regulation identifies that in case of a positive result
for the in vitro gene mutation study in bacteria (8.4 Mutagenicity) “further testing shall be
considered”. What this means in practice is expanded upon in detail in ECHA guidance.
The ECHA “Guidance on Information Requirements and Chemical Safety Assessment - Chapter R.7a:
Endpoint Specific Guidance12” sets out specific guidance on meeting the information requirements in
Annexes VI to XI to the REACH Regulation. The guidance includes, for each endpoint, an Integrated
Testing Strategy (ITS) “providing guidance on how to define and generate relevant information on
substances in order to meet the requirements of REACH13”.
In the event of a positive result in the Annex VII test for mutagenicity, the general route followed by
ECHA guidance is one of undertaking relevant mutagenicity testing (including in vivo studies)
progressing up through Annex VIII and above. Thus, to establish genotoxicity all of the following are
required in the event of a positive result for GMBact:


either or both of CAbvitro/MNT Vitro or GMvitro tests in Annex VIII as appropriate to the
ITS;
Cytvivo or GMvivo14 in vivo tests in Annex IX as appropriate to the ITS.
For a substance presenting negative in the in vivo tests it would be concluded that the substance is
not genotoxic and no further testing or consideration for carcinogenicity or reproductive toxicity is
required. For a substance presenting positive in the in vivo tests it would be concluded that the
substance is genotoxic to somatic cells. This, in turn, triggers consideration of whether the
substance is also toxic to germ cells. Positive conclusions in relation to either trigger further
consideration of carcinogenicity and reproductive toxicity (but no further testing is required in
relation to these endpoints).
12
Guidance on Information Requirements and Chemical Safety Assessment - Chapter R.7a: Endpoint specific
guidance, Version 3.0, August 2014
13
Structure of Chapter R.7a – page 15
14
GMbact: gene mutation test in bacteria (Ames test); CAbvitro, in vitro chromosome aberration test;
MNTvitro, in vitro micronucleus test; GMvitro:gene mutation assay in mammalian cells; Cytvivo:cytogenetic
assay in experimental animals; GMvivo:gene mutation assay in experimental animals
REACH 1 to 10 t Phase 2
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Following the ITS, the conclusions possible for a 1-10t substance recording a positive result in the
Annex VII GMBact test for mutagenicity are:

the substance is genotoxic to somatic cells only and hence meets classification as a category
2 mutagen;

the substance is genotoxic to somatic and germ cells and hence meets classification as a
category 1B mutagen;

the substance is not genotoxic.
2.3 Duty to Communicate Information in the Supply Chain
2.3.1 Overview
In addition to information requirements to be supplied in registration dossiers, REACH places duties
on manufacturers, importers and downstream users (DUs) to supply information up and down the
supply chain. This includes:


provision of key information on a substance down the supply chain by the production of
Safety Data Sheets (SDSs);
obligations on downstream users in relation to supplying information both up and down the
supply chain.
2.3.2 Safety Data Sheets
The requirement for manufacturers and importers to provide a Safety Data Sheet (SDS) exists for all
substances with hazardous properties (including those produced in quantities of 1-10t per year) and
is defined in Annex II of REACH. The aim of a SDS is to provide downstream users of a substance
with information to enable them to implement controls to address the risks arising from use of a
substance. Sections 7 and 8 (Handling and storage; Exposure controls/personal protection) in
particular are fed from the exposure scenarios developed for that substance during CSA. For such
substances there should be no discrepancies between the information in the SDS and that in the
exposure assessment completed as part of CSA and handling and storage advice and exposure
control measures should be described with detail in the SDS.
As noted in Section 2.1, no CSA is required for the 1-10t substances and only more general advice is
required in the SDS, the specification for which is summarised in Table 2.4. However, all available
information should be considered for classification and communication in the SDS and not only the
information specifically required for a registrant’s own registration. As such, for substances
registered in the 1-10t band and also in higher tonnages the information communicated including
classifications must be consistent regardless of the reduced dossier information requirements for 110t registrations.
REACH 1 to 10 t Phase 2
RPA & CSES | 12
Table 2.4: Content of Safety Data Sheets (SDS) as Required by Annex II of REACH
Main Section
Subsections (Required of all substances regardless of CSR)
SECTION 1: Identification of the
1.2 Relevant identified uses of the substance or mixture and
substance/mixture and of the
uses advised against
company/undertaking
SECTION 2: Hazards identification
2.1. Classification of the substance or mixture
2.2. Label elements
2.3. Other hazards
Information shall be provided on other hazards which do
not result in classification but which may contribute to the
overall hazards of the substance or mixture
SECTION 3:
3.1. Substances
Composition/information on
3.2. Mixtures
ingredients
SECTION 4: First aid measures
4.1. Description of first aid measures
4.2. Most important symptoms and effects, both acute and
delayed
4.3. Indication of any immediate medical attention and
special treatment needed
SECTION 5: Firefighting measures
SECTION 6: Accidental release
6.1. Personal precautions, protective equipment and
measures
emergency procedures
6.2. Environmental precautions
6.3. Methods and material for containment and cleaning up
6.4. Reference to other sections
SECTION 7: Handling and storage
7.1. Precautions for safe handling
7.2. Conditions for safe storage, including any
incompatibilities
7.3. Specific end use(s)
SECTION 8: Exposure
8.1. Control parameters
controls/personal protection
8.2. Exposure controls
SECTION 9: Physical and chemical
9.1. Information on basic physical and chemical properties
REACH 1 to 10 t Phase 2
RPA & CSES | 13
Current source of Information for 1-10t CMRs 1A/1B
Annex VI information
Annex VI information and application of Annex VII to XI
requirements
Information
in
relation
to
carcinogenicity
and
reproductive/developmental toxicity that have been considered by
application of Annex VII to XI requirements but cannot be
classified owing to data limitations.
Annex VI information
Annex VI information
Annex VI information
Annex VI information
Annex VI information
Annex VII information on physicochemical properties
Table 2.4: Content of Safety Data Sheets (SDS) as Required by Annex II of REACH
Main Section
Subsections (Required of all substances regardless of CSR)
properties
9.2. Other information
SECTION 10: Stability and reactivity
SECTION 11: Toxicological
11.1. Information on toxicological effects
information
SECTION 12: Ecological information
12.1. Toxicity
12.2. Persistence and degradability
12.3. Bioaccumulative potential
SECTION 13: Disposal considerations
SECTION 14: Transport information
SECTION 15: Regulatory information
12.4. Mobility in soil
12.5. Results of PBT and vPvB assessment
12.6. Other adverse effects
13.1. Waste treatment methods
15.1.
Safety,
health
and
environmental
regulations/legislation specific for the substance or mixture
15.2. Chemical safety assessment
It must be indicated if a CSA has been carried out.
SECTION 16: Other information
ANNEX
Exposure scenarios from CSA/CSR
REACH 1 to 10 t Phase 2
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Current source of Information for 1-10t CMRs 1A/1B
Annex VII information
Annex VI information and application of Annex VII to XI
requirements
Application of Annex VII to XI requirements
Results from tests on ready biodegradation in accordance with
Section 9.2.1.1 of Annex VII
Octanol-water partitioning coefficient experimentally determined
in accordance with Section 7.8 of Annex VII
Annex VII information on physicochemical properties
Not required
Application of Annex VII to XI requirements
Annex VI information
Annex VI information
References to other regulation as appropriate which would
include:
 Directive 98/24/EC on the protection of the health and
safety of workers from the risks related to chemical agents at
work (CAD);
 the Carcinogens and Mutagens Directive 2004/37/EC (CMD);
 the Pregnant and Breastfeeding Workers Directive
92/85/EEC;
 Directive 2001/95/EC on General Product Safety;
 Toys Directive 2009/48/EC;
 the Drinking Water Directive 98/83/EC; and
 The Water Framework (WFD) and EQS Directives.
Whilst no CSA is required it must be indicated if a CSA has been
carried out.
As appropriate
Not Required
2.3.3 Obligations on Downstream Users under REACH
REACH also places duties on downstream users to communicate information up and down the
supply chain where this includes:




passing information that identifies particular uses up the supply chain (so that they can be
included as uses in the registration dossier);
a duty to ensure the identification and application of appropriate risk management
measures identified in safety data sheets;
a duty to pass information further down the supply chain in the form of SDS to ensure safe
use by downstream users;
a duty to keep SDS up to date and notify downstream users of any changes (including in
relation to Authorisation and Restriction.
A list of the key provisions and their applicability in relation to the 1-10t substances is provided in
Table 2.5.
REACH 1 to 10 t Phase 2
RPA & CSES | 15
Table 2.5: List of the Key Provisions by Duty-holders, Drivers and Benefits for Information in the Supply Chain
Article
Key Provisions
31(1)
Requirement on a supplier of a substance or a mixture to provide recipient with a SDS compiled in accordance with Annex II.
M, I, DU
31(8-9)
The SDS shall be provided free of charge either electronically or on paper.
M, I, DU
Requirement on a supplier to update the SDS and provide it free of charge to all former recipients as soon as new information becomes
available or once an authorisation has been granted or refused or once a restriction has been imposed.
M, I, DU
Requirement on a supplier of an article containing a substance meeting the criteria in Article 57 (including CMRs 1A/1B) in a concentration
above 0.1 % weight by weight (w/w) to provide the recipient with sufficient information to allow safe use, including as a minimum the name
of that substance.
M, I
Requirement on a supplier of an article to provide a consumer on request with sufficient information to allow safe use, including as a
minimum the name of that substance, free of charge and within 45 days of the request
D
34
Requirement on every actor (including distributor) in the supply chain to communicate the information on new information or any other
information that might call into question the appropriateness of the risk management measures identified in an SDS to the next actor or
distributor up the supply chain.
M, I, DU, D
35
Requirement on an employer to provide workers and their representatives with access to information received in accordance with articles
31 and 32 in relation to substances or mixtures which they may use or be exposed to in the course of their work.
M, I, DU, D
39
Article 39 states that downstream users shall comply with the Article 37 obligations at the latest 12 months after receiving a registration
number.
DU
37(5)
Requirement on downstream user to identify and apply appropriate measures to adequately control risks identified in an SDS supplied to it.
DU
33(1
and 2)
Duty-holders
Requirement on downstream user to recommend, where suitable, measures to adequately control the risks identified in an SDS supplied to
it.
REACH 1 to 10 t Phase 2
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37(2)
Requirement on a downstream user to have the right to make a use known in writing. Requirements on distributors to pass on such
information to the next actor up the supply chain.
DU
37(6)
Requirement on a downstream user to identify and apply appropriate risk management measures needed to ensure that the risks to human
health and the environment are adequately controlled. Where a downstream user does not prepare a chemical safety report in accordance
with paragraph 4(c), he shall consider the use(s) of the substance and identify and apply any appropriate risk management measures
needed to ensure that the risks to human health and the environment are adequately controlled. Where necessary, this information shall be
included in any safety data sheet prepared by him.
DU
Key: M = Manufacturers, I = Importers, DU = Downstream Users, D = Distributors
REACH 1 to 10 t Phase 2
RPA & CSES | 17
2.4 Compliance with Parallel Regulation
As noted in the overview in Section 2.1, as the requirement to conduct a CSA does not currently
apply to the 1-10t substances, risk management is, at present, achieved via classification under CLP
which, in turn, triggers risk management requirements under other community regulation.
In the event that a substance is identified as meeting one or more criteria for classification in
accordance with Regulation (EC) No 1272/2008, the Classification and Labelling Inventory (CLI) will
be updated to reflect the new classification. This change in classification then triggers actions on the
part of manufacturers, importers and downstream users to comply with other pieces of community
regulation. Key areas of regulation requiring action on the part of manufacturers, importers and
downstream users to assess exposure, risks and implement risk management measures are:



Worker health and safety regulation;
Product safety requirements; and
Waste regulation.
2.4.1 Worker Health and Safety Regulation
Several pieces of worker health and safety regulation require action on the part of employers (which
would include manufacturers and downstream users of substances) to assess the risk and exposure
of workers to substances with C, M or R 1A or 1B properties or with other hazardous properties. Key
pieces of regulation here are:




the Carcinogens and Mutagens Directive 2004/37/EC (CMD);
Directive 98/24/EC on the protection of the health and safety of workers from the risks
related to chemical agents at work (CAD);
the Pregnant and Breastfeeding Workers Directive 92/85/EEC; and
Directive 94/33/EC on Young Workers
Directive 2004/37/EC on Carcinogens and Mutagens
The Carcinogens and Mutagens Directive 2004/37/EC (CMD) sets specific risk management
measures for workers exposed to carcinogens and mutagens. The scope of the Carcinogens and
Mutagens Directive is specifically focussed on the carcinogenic and mutagenic properties of
substances and associated risks to workers’ health. Environmental hazards and risk are outside of
the scope, as are impacts on the environment and consumers.
As the Directive applies to all employers where workers may be exposed to carcinogens and/or
mutagens its provisions apply to both manufacturers and downstream users as defined by REACH.
Under Article 3(2) manufacturers and downstream users must determine the nature, degree and
duration of workers' exposure to carcinogens or mutagens in order to make it possible to assess any
risk to the workers' health or safety and to lay down the measures to be taken. When assessing the
risk, account shall be taken of all routes of exposure, such as absorption into and/or through the
skin. When the risk assessment is carried out, particular attention shall be given to any effects
concerning the health or safety of workers at particular risk and shall, inter alia, take account of the
Phase 2 1-10t Study: Final Options for Extending Information Requirements
RPA | 18
desirability of not employing such workers in areas where they may come into contact with
carcinogens or mutagens.
Data on workers’ exposure to C and M 1A and 1B must be generated at specific workstations in
order to inform the risk assessment. In the case of any activity likely to involve a risk of exposure to
carcinogens or mutagens, the nature, degree and duration of workers' exposure shall be determined
in order to make it possible to assess any risk to the workers' health or safety. There is no
requirement under CMD for employers (manufacturers and downstream users) to generate
additional data on hazards. As such, the information to complete the assessment is drawn from the
SDS. Employers (manufacturers and downstream users) are, however, required to generate new
data on the workers exposure to chemical agents on site (i.e. level, type and duration of exposure).
In terms of risk management measures, CMD requires that, as a priority, workers' exposure must be
prevented through substitution. If not possible, a closed technological system shall be used. Where a
closed system is not technically possible, the employer shall reduce exposure to minimum through a
number of risk management measures specified in the Directive.
Directive 98/24/EC on Chemical Agents
As with the CMD, Directive 98/24/EC15 on the protection of the health and safety of workers from
the risks related to chemical agents at work (CAD) requires employers to determine whether any
hazardous chemical agents are present at the workplace and assess any risk to the safety and health
of workers arising from the presence of those chemical agents. As such, the scope of the CAD is
broad, covering the assessment and control of all physicochemical and human health risks to
workers. Environmental hazards and risk are outside of the scope, as are impacts on the
environment, on humans via the environment and on consumers.
As with CMD, site specific data on workers’ exposure to chemical agents at specific work stations
must be generated. The SDS provided by suppliers under REACH will be the key means to identify
and assess hazardous substances in the workplace. This hazard data will be combined with exposure
data generated for specific workstations to assess the risk to individual workers.
The Commission has issued a guidance document for employers on controlling risks from chemicals
concerning the interface between the Chemicals Agent Directive and REACH at the workplace. 16 It
states that, while the obligations of the CAD continue to apply after the adoption of the REACH
Regulation, there is no duplication between the two acts.
15
Council Directive 98/24/EC of 7 April 1998 on the protection of the health and safety of workers from the risks related
to chemical agents at work (fourteenth individual Directive within the meaning of Article 16(1) of Directive
89/391/EEC), OJ L 131, 5.5.1998, p. 11–23.
16
Guidance for employers on controlling risks from chemicals, Interface between Chemicals Agents Directive
and REACH at the workplace, European Commission, October 2010, link available at:
http://ec.europa.eu/social/main.jsp?catId=716&langId=en&intPageId=223
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Directive 92/85/EEC on Pregnant Workers and Directive 94/33/EC on Young Workers
The Pregnant and Breastfeeding Workers Directive 92/85/EEC requires employers to conduct a risk
assessment to the nature, degree and duration of exposure to certain types of chemical agents in so
far as it is known that they endanger the health of pregnant women and the unborn child. The risk
assessments apply to substances and mixtures, and require assessment of risks to vulnerable
workers from substances generated in the workplace. This Directive sets risk management
measures to limit the exposure of pregnant workers, workers who have recently given birth and or
who are breastfeeding to certain hazardous chemicals. The risk management measures vary
depending on whether the exposure is to chemical agents listed in Annex I or to chemical agents
listed in Annex II (lead and lead derivatives), with work prohibited in the latter case.
For chemical agents set in Annex I the duties on the employer include that:



the employer shall assess the nature, degree and duration of exposure;
he/she shall assess any risks to the safety or health and any possible effects on the
pregnancy or breastfeeding of workers; and
he/she shall then decide what measures should be taken.
The Young Workers Directive 94/33/EC17 takes a two-tiered approach to protecting young workers
from exposure to chemical agents. Firstly, employers are obliged to assess the hazards to young
people, involving the identification of chemical hazards with respect to chemical agents in the
workplace. They must then generate new site-specific data on the nature, degree and duration of
exposure to chemical agents. Employers shall then adopt the measures necessary to protect the
safety and health of young people. In particular, work involving the exposure of young people to
agents to certain categories of substances is prohibited, namely substances that are toxic,
carcinogenic, cause heritable genetic damage or harm to the unborn child or which in any other way
chronically affect human health.
2.4.2 Compliance with Product Safety Regulation
In addition to worker health and safety requirements, classification as C, M or R 1A/1B under CLP
has implications in terms of safety of products. Annex XVII of REACH (entries 28 to 30) prohibits the
placing on the market and the use of CMRs 1A/1B as substances or as constituents of other
substances or mixtures for supply to the general public when the individual concentration in the
substance or the mixture is equal to or greater to the generic/specific concentration limit of the CLP
Regulation. However, currently consumer articles are not in the scope of the entries 28 to 30, but
some specific legislation applies to some of these articles.
Directive 2001/95/EC on General Product Safety
The General Product Safety Directive (GPSD) is complementary to specific product safety legislation
by sector. It applies in its entirety to consumer products falling outside the scope of sector
Directives. In addition, it applies partially to consumer products covered by sector legislation (for
17
Council Directive 94/33/EC of 22 June 1994 on the protection of young people at work, OJ L 216, 20.8.1994,
p. 12.
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example toys or cosmetics). In general specific sector provisions have priority over general
provisions although the GPSD for certain aspects may be more detailed than the sector directives.
Under Article 3 of the GPSD producers are obliged to place only safe products on the market where:



‘product’ means any product — including in the context of providing a service — which is
intended for consumers or likely, under reasonably foreseeable conditions, to be used by
consumers even if not intended for them;
‘producer’ means the manufacturer of the product, the manufacturer's representative,
when the manufacturer is not established in the Community or the importer of the product
or other professionals in the supply chain, insofar as their activities may affect the safety
properties of a product; and
‘safe product’ means any product which, under normal or reasonably foreseeable conditions
of use does not present any risk or only the minimum risks compatible with the product's
use, considered to be acceptable and consistent with a high level of protection for the safety
and health of persons including the categories of consumers at risk when using the product,
in particular children and the elderly.
In combination with considerations covered by other sector specific regulation, manufacturers,
importers and downstream users of 1-10t substances used in products (as defined above) and
identified as meeting classification for hazardous properties would have to consider the implications
of such a classification on the safety of any products containing that substance. To comply with the
GPSD, assessment of the risk to consumers from the presence of the substance in a product would
be required where this would include consideration of human exposure to the substance from use of
the product.
In cases where products may pose a serious risk, the GPSD establishes that Member States are to
assess and take appropriate action. Here, under certain conditions, the Commission may adopt a
formal temporary Decision requiring the Member States to ban the marketing of a product, to recall
it from consumers or to withdraw it from the market. A Decision of this kind is temporary but it may
be renewed and result in permanent legislation. Emergency measures have been taken in the past
for: Dimethylfumarate (DMF) and Phthalates.
2.4.3 Other Product Safety Regulation - Uses Not Exempted from REACH
In addition to requirements on general product safety, a number of other regulations deal
specifically with product safety in uses and applications that are not exempted from REACH. These
include Regulation No 305/2011 for the Marketing of Construction Products and the Toys Directive
2009/48/EC.
Regulation No 305/2011 for the Marketing of Construction Products
The Construction Products Regulation (EU) No 305/201118 requires the manufacturer to draw up a
declaration of performance when placing a product on the market. Where a construction product
18
Regulation (EU) No 305/2011 of the European Parliament and of the Council of 9 March 2011 laying down harmonize d
conditions for the marketing of construction products and repealing Council Directive 89/106/EEC, OJ L 88,
4.4.2011, p. 5.
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has been found to present a risk to the basic requirements set out under Annex I of the Regulation,
Member States may conduct an evaluation of the product. Point 3 of Annex I deals with risks to
hygiene, health and the environment, namely that:
“The construction works must be designed and built in such a way that they will, throughout their life
cycle, not be a threat to the hygiene or health and safety of workers, occupants or neighbours, nor
have an exceedingly high impact, over their entire life cycle, on the environmental quality or on the
climate during their construction, use and demolition, in particular as a result of any of the following:
(a) the giving-off of toxic gas;
(b) the emissions of dangerous substances, volatile organic compounds (VOC), greenhouse gases or
dangerous particles into indoor or outdoor air;
(c) the emission of dangerous radiation;
(d) the release of dangerous substances into ground water, marine waters, surface waters or soil;
(e) the release of dangerous substances into drinking water or substances which have an otherwise
negative impact on drinking water;
(f) faulty discharge of waste water, emission of flue gases or faulty disposal of solid or liquid waste;
(g) dampness in parts of the construction works or on surfaces within the construction works.”
Toys Directive 2009/48/EC
Directive 2009/48/EC on the safety of toys19 lays down rules on the safety of toys and on their free
movement within the internal market. Article 18 of the Toy Safety Directive requires manufacturers,
before placing a toy on the market, to carry out an analysis of the chemical, physical, mechanical,
electrical, flammability, hygiene and radioactivity hazards that the toy may present, as well as an
assessment of the potential exposure to such hazards.
2.4.4 Compliance with Waste Legislation
Waste Framework Directive 2008/98/EC
Directive 2008/98/EC (the Waste Framework Directive) establishes a legal framework for the
treatment of waste within the Community, and aims at protection of the environment and human
health by way of preventing or reducing the harmful effects of waste generation and waste
management.
Section 13 of Annex II of REACH on the requirements for the compilation of safety data sheets
provides that this section of the safety data sheet must describe information for proper waste
19
Directive 2009/48/EC of the European Parliament and of the Council of 18 June 2009 on the safety of toys, OJ L 170,
30.6.2009, p.1
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management of the substance or mixture and/or its container to assist in the determination of safe
and environmentally preferred waste management options, consistent with the requirements in
accordance with Directive 2008/98/EC.
2.4.5 Compliance with Limit Values and Exposure Limits under Parallel
Regulation
In addition to the implementation of risk control measures in accordance with the above described
regulations, a number of regulations permit the establishment of limit values and exposure limits by
the Commission and Member States. Once established, these must be complied with. However, it
should be noted that the level of toxicological and ecotoxicological information required under
Annex VII is, by itself, not sufficient for the Commission or Member States to derive limit values and
exposure limits. Thus, without undertaking further testing, only for 1-10t substances for which there
is information in excess of the Annex VII requirements would such limits be identifiable. At present,
this is an unlikely outcome except for 1-10t substances for which the information already exists
and/or the substance is also registered in one or more higher tonnage bands.
For completeness, the key regulation that permits the setting of limit values and exposure limits is
provided in the following subsections.
Directive 98/24/EC on Chemical Agents
In addition to the duties on employers, the Chemical Agents Directive (CAD) requires the evaluation
of the relationship between the health effects of hazardous chemical agents and the level of
occupational exposure in order to propose indicative occupational exposure limit values (IOELV) for
the protection of workers from chemical risks. These limit values are set at EU level by the
Commission. Member States should then set national occupational exposure limit values, taking
into account the Community limit values. In addition, binding biological limit values may be drawn
up at Community level on the basis of the evaluation described above and of the availability of
measurement techniques, and shall reflect feasibility factors while maintaining the aim of ensuring
the health of workers at work. Binding occupational exposure limit values may also be drawn up at
Community level. Member States shall then establish a corresponding national binding OEL. If a
binding biological limit value is established, Member States shall establish a corresponding national
binding biological limit. The SDS should list the national exposure and biological limit values set in
accordance with the CAD.
Directive 2004/37/EC on Carcinogens and Mutagens
Under Article 16 of the Directive, the Council shall set out limit values on the basis of the available
information, including scientific and technical data, in respect of all those carcinogens or mutagens
for which this is possible, and, where necessary, other directly related provisions.
Drinking Water Directive 98/83/EC
Directive 98/83/EC on the quality of water intended for human consumption20 aims at protecting
human health from the adverse effects of contamination of water intended for human consumption.
20
Directive 98/83/EC on the quality of water intended for human consumption, OJ L 330, 5.12.1998, p. 32–
54
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It covers a number of chemical parameters for which parametric values are set up in Annex I.
Member States may also set parametric values for additional substances which, in numbers or
concentrations, constitute a potential danger to human health. Derived No Effect Level (DNEL)
values as result of a risk assessment under REACH may inform the development of values under
Annex I where sufficient information is available to generate them.
Water Framework (WFD) and Environmental Quality Standards (EQS) Directives
Under the WFD and EQS Directives, environmental quality standards for priority substances and
priority hazardous substances in surface water are set. EQS aims to control environmental risk as
well as secondary poisoning and exposure of humans via the environment, as well as long-term
exposure, bioaccumulation and secondary poisoning of biota. Synergies exist between the Predicted
No Effect Levels (PNECs) that can be derived by consideration of information from Annexes VII and
VIII of REACH and the EQS under the water legislation.
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3 Development of Options for Refining Information
Requirements
3.1 Introduction
The overall aim of REACH as a whole is to achieve:



a high level of protection of human health and environment;
free movement of substances on their own, in mixtures, and in articles; while
enhancing competitiveness and innovation.
One of the main drivers for the adoption of REACH is the fact that, prior to its adoption, information
on the inherent properties needed to manage chemicals safely was not available for a significant
percentage of the substances that have historically been placed on the European market (of which
more than half – around 20,000 - are expected to be registered in the 1-10t band only).
The production, use and disposal of chemicals and of products containing hazardous chemicals had
(and has) been linked to a wide range of environmental and health impacts. As such, while some
examples of the adverse consequences of a limited number of recognised hazardous substances
were known, due to the lack of data of a significant percentage of substances, the overall impact of
chemicals on the environment and human health was not known and the existence of further
hazardous substances was (and still is) suspected.
REACH seeks to address these issues and achieve its aims by requiring manufacturers and importers
to generate data on the substances they manufacture or import, to use these data to assess the risks
related to these substances and to develop and recommend appropriate risk management
measures. Furthermore, to ensure that they actually meet these obligations, registration requires
them to submit a dossier containing all this information to the Agency.
At the same time, requirements for generation of information on substances under REACH is tiered
according to the volumes of manufacture or importation of a substance (because these provide an
indication of the potential for exposure of man and the environment to the substances). However,
to reduce the possible economic impact on low volume substances, REACH identifies that new
toxicological and ecotoxicological information should only be required for “priority substances
between 1 and 10 tonnes”. For other substances in that quantity range REACH identifies that there
should be incentives to encourage manufacturers and importers to provide this information (and
indeed Registration fees are waived for substances providing this information).
In relation to the identification of “priority substances between 1 and 10 tonnes”, as described in
Section 2.2.2, this is established by a combination of Article 12 and Annex III and prioritisation is by
means of prediction of toxicological properties by “the application of (Q)SARs and other evidence”.
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Thus, “priority substances between 1 and 10 tonnes” under REACH are “substances for which it is
predicted (i.e. by the application of (Q)SARs or other evidence) that they are likely to meet the
criteria for”:


classification as C, M or R 1A/1B or PBT/vPvB; or
any health or environmental hazard classes or differentiations under CLP and have a
dispersive or diffuse use.
In respect of achieving the overarching aims of REACH (listed above) the successfulness (or
otherwise) of the current strategy in relation to the 1-10t substances is highly dependent on the
extent to which hazardous properties will be correctly “predicted by the application of (Q)SARs or
other evidence”. This applies to both the identification of priority substances and also to the
overarching objective of reducing the possible (cost) impact on low volume substances. This is
because:

For the identification of priority substances: the successfulness of the strategy depends on
the extent to which QSARS or other evidence are able to correctly identify substances that
do have (as yet unknown) hazardous properties – any substances which are not correctly
identified as priority 1-10t substances will not have to provide the Annex VII toxicological
and ecotoxicological information (and their hazardous properties will not be identified and
risks managed); and

For reducing the possible economic impact on low volume substances: the successfulness
of the strategy depends on the extent to which QSARS or other evidence are able to
correctly identify substances that do not have hazardous properties – those substances that
are incorrectly identified as priority 1-10t substances would have to incur the costs of
providing Annex VII toxicological and ecotoxicological information despite the fact that no
hazardous properties would be identified by undertaking the testing (because there are
none).
Considering both objectives, if prediction by QSARs and other evidence is 100% accurate in the
correct identification of substances with/without hazardous properties, then only those substances
with hazardous properties would be required to incur the costs of providing the toxicological and
ecotoxicological information that would confirm the predicted classifications. This is the ideal
situation.
However, no prediction by QSARs or other evidence is 100% accurate in its predictions. Indeed, for
an individual QSAR endpoint, a sensitivity value of 70% (meaning that 70% of substances with a
positive response for the endpoint would be correctly identified as positive and 30% would be
identified as false negative) and a specificity value of 70% (meaning that 70% of substances with a
negative response for the endpoint would be correctly identified as negative and 30% would be
identified as false positive) would be considered very good. Thus, even with very good levels of
predictive accuracy using QSARs there may be a significant number of false positives and false
negatives (as well as true positives and true negatives).
In addition to predictive uncertainties, the current Annex III criteria exclude substances with
potential human health and environmental classifications (with the exception of CMRs and
PBT/vPvB) from the requirement to provide information that would lead to classification as long as
they have no dispersive or diffuse uses. This effectively excludes the possibility of identifying the
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hazardous properties (and thus controlling the risks) of substances with no diffuse/dispersive uses
even though these substances may pose a risk to, for example, workers.
For these reasons, as part of a study examining refinements to information requirements, it is
necessary to examine the likely successfulness of the current strategy and, within this, consider
alternative approaches and adjustments. Indeed, the specification for this study identifies that “a
limited number of options for amending Annex III should be developed, together with an estimation
of their respective impact in terms of capacity to identify hazardous substances”.
In addition to the factors that govern whether substances require toxicological and ecotoxicological
information in Annex VII, the aim of the study is also to consider:



the nature of the toxicological and ecotoxicological information required under Annex VII;
the usefulness of that information; and
whether any refinements could be made which would further enhance the benefits in terms
of the identification and hazardous properties and implementation of suitable controls
(within acceptable cost boundaries).
Options for refining the information requirements in Annex VII have been developed and assessed in
combination with those for Annex III. The options and the reasoning behind them are described in
the following sub-sections.
3.2 Options for Altering Annex III
When developing options for Annex III, the purpose has been to allow the subsequent analysis of
costs and benefits to measure the relative successfulness of the strategies available for identifying
priority 1-10t substances (by prediction using QSARs and other information) versus identifying all
hazardous substances (by requiring all substances to provide toxicological and ecotoxicological
information).
Legal aspects of the options have not been considered as these require considerable legal expertise
and, in any case, the need for such expertise is/should be contingent on the findings of the study
(and not the other way around).
The options that appear useful to consider in relation to Annex III are:



Do nothing- the baseline;
Remove the diffuse/dispersive use criterion in Annex III – which would result in all 1-10t
substances identified by QSARs or other information to have any human health or
environmental classification to provide toxicological and ecotoxicological information (as
opposed to only those with dispersive/diffuse uses); and
Remove all criteria in Annex III – i.e. require all 1-10t substances to provide toxicological
and ecotoxicological information.
3.2.1 Options for Extending the Information Requirements
The development of options for extending the toxicological and ecotoxicological information in
Annex VII has focussed on identifying the additional requirements from Annex VIII that may be of
prime relevance for the purpose of clarifying whether or not a substance fulfils classification criteria
Phase 2 1-10t Study: Final Options for Extending Information Requirements
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coupled with additional information that may be of use to the setting of limit values and exposure
limits.
There are numerous combinations of options and sub-options that could in theory be considered but
the study specification limits consideration to a maximum of five options for full assessment of costs
and benefits. It has therefore been necessary to refine and structure the options by eliminating
some on the basis of practicality including the potential for obviously excessive costs and
acceptability combined with limited usefulness of the information. For example, applying the full
information requirements of Annex VIII (as well as VII) to 1-10t substances would include a number
of elements that do not provide useful additional information in the context of the 1-10t substances
and would dramatically increase costs of providing information.
Here, a number of the endpoints in Annex VIII provide additional information for carrying out a
Chemical Safety Assessment (CSA). As a CSA is not required for 1-10t substances, information from
all Annex VIII endpoints is surplus to requirements and hence the Commission has agreed that
extending the information requirements to include all Annex VIII endpoints would not, therefore,
represent a cost-effective means of refining the information requirements.
Given the restricted number of options available, two options for extending information
requirements based on the inclusion of selected Annex VIII endpoints have been developed. These
two extended information options represent an increasing level of information (and also increasing
cost and potential benefit). Thus the information options considered in the analysis are:



Annex VII (the baseline): Current Annex VII toxicological and ecotoxicological information;
Annex VII+: Current Annex VII toxicological and ecotoxicological information plus endpoints
and requirements selected from Annex VIII to deliver additional classifications and
information with the smallest possible likely increase in cost;
Annex VII++: As Annex VII+ above but with the addition of certain key elements/changes
from Annex VIII that may deliver further benefits in terms of identification of hazardous
properties and substances with hazardous properties but would represent a more significant
increase in costs.
Approach used to determine composition of Extended Information Options
Determining the composition of the Annex VII+ and VII++ options has required consideration of the
merits of including each of the following human health and environmental endpoints/sections that
currently apply to 10-100t substances under Annex VIII:

Human Health Endpoints (Toxicology): 8.1 Skin irritation /skin corrosion; 8.2 Eye irritation;
8.3 Skin sensitisation; 8.4 Mutagenicity; 8.5 Acute toxicity; 8.6 Repeated dose toxicity; 8.7
Reproductive toxicity; 8.8 Toxico-kinetics

Environmental Endpoints (Ecotoxicology): 9.1 Aquatic toxicity; 9.2 Degradation; 9.3. Fate
and behaviour in the environment.
When deciding which aspects of Annex VIII should and should not be included in the two extended
information options, the overarching consideration has been the benefit of gathering the additional
information for the 1-10t substances considering the opportunities that the information might
provide for enhanced risk management. A key consideration here has been that, as described in
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Section 2, a CSA is not required for 1-10t substances and risk control is principally achieved by
classification and labelling which, in turn, triggers requirements in relation to parallel regulation.
In contrast, for the 10-100t substances (to which Annexes VII and VIII apply), the CSA is the key
mechanism for identifying (and subsequently implementing) appropriate risk control and a number
of the additional information elements that are included in Annex VIII are present specifically to
provide the enhanced information required to perform a CSA for the >10t substances and not for the
purpose of identifying further hazardous properties for classification and labelling.
As well as considering the merits of additional information from inclusion of Annex VIII endpoints,
we have also considered alterations to the use of information that already forms a part of Annex VII.
This applies only to information that must already be gathered for the following three endpoints in
Annex VII where this information could, in principle, be used to screen for PBT/vPvB properties (and
a positive screening result would then require more information to allow assessment). Such
screening is not currently required in the regulation as it applies to 1-10t substances because the
requirement to screen and assess PBT/vPvB properties is contained within Annex XIII on CSA (which
does not apply to the 1-10t substances):



ready biodegradation in accordance with Section 9.2.1.1 of Annex VII;
octanol-water partitioning coefficient experimentally determined in accordance with Section
7.8 of Annex VII (physico-chemical properties); and
short-term aquatic toxicity in accordance with Section 9.1 of Annex VII.
Annex I to this report describes the detailed reasoning behind the selection of endpoints for the
Annex VII+ and VIII++ options, examining each section of the Annexes in turn. Table 3.1 (overleaf)
summarises the options.
3.3 Combining the Annex III and Extended Information Options to
a Final Five
With three options for Annex III requirements and three options for information options, the total
number of possible combinations is nine. One of these nine combinations (current Annex III
requirements combined with current Annex VII requirements) comprises the baseline for the study
and so is not an option in itself. This leaves eight combinations from which five must be selected.
Table 3.2 identifies which combinations of Annex III and Information Options were selected for
further analysis of costs and benefits (by agreement with the Commission).
Table 3.2: Final Combinations of Options to Progress to Full Impact Assessment
Annex III Options
Information Options
Current Annex VII
Annex VII+
Do nothing
Baseline
No
Remove diffuse/dispersive use criterion
Yes
Yes
Remove all criteria
Yes
Yes
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Annex VII++
No
Yes
No
Table 3.1: Summary of Extended Information Options
REACH Annex
Annex VII+
Section
8.1 Skin irritation
Maintain as at present
/skin corrosion
Section 8.2 Eye
Maintain as at present
Irritation
Section 8.3 Skin
Maintain as at present
Sensitisation
Section 8.4
Maintain current approach (GMBact)
Mutagenicity
Section 8.5 Acute
Maintain as at present
Toxicity
Section 8.6
Repeated Dose
Toxicity
Maintain as at present (no short repeated dose
toxicity testing)
Section 8.7
Reproductive
Toxicity
Section 8.8 Toxicokinetics
Maintain as at present (no reproductive toxicity
testing)
Section 9.1 Aquatic
Toxicity
Assessment of the toxicokinetic behaviour of the
substance in accordance with Section 8.8.1 Annex VIII
may be carried out where a new requirement to
screen for PBT/vPvB properties identifies a substance
as a potential PBT/vPvB and this will be useful to
assessment.
Testing in accordance with Section 9.1.3 - short-term
toxicity testing on fish would be undertaken:
 for any substances identified with a classification
as hazardous to the aquatic environment by
Annex VII++
As Annex VII+
Overview of Benefit of Additional
Information
N/A
As Annex VII+
N/A
As Annex VII+
N/A
Extend to a two test battery (GMBact
plus MNTvitro)
Classification for acute oral toxicity in
accordance with Section 8.5.1 of Annex
VII triggers consideration of dermal and
inhalation toxicity in accordance with
Sections 8.5.2 and 8.5.3 of Annex VIII.
Short term repeated dose toxicity in
accordance with Section 8.6.1 of Annex
VIII for substances identified by testing
under 8.5.1 as Acute Tox 4.
As Annex VII+
Enables the detection of a greater
number of genotoxic substances
Provides additional classifications and
information for exposure assessments
required to be undertaken by
manufacturers and downstream users
under parallel regulation.
As above.
As Annex VII+
Only required if contributes to
assessment of PBT/vPvB – provided only
for completeness.
As Annex VII+
Enables the generation of PNECs for use
by regulators and others in relation to
assessing the need for action under
parallel environmental regulation.
Phase 2 1-10t Study: Final Options for Extending Information Requirements
RPA | 30
N/A

Section 9.2
Degradation
Section 9.3. Fate
and behaviour in the
environment
testing in accordance with Section 9.1 of Annex
VII; and
 for any substances where screening for P and B in
PBT/vPvB identifies that criteria for both P and B
(or vP and vB) are met.
 information from the ready biodegradability test
in Annex VII will be used to inform screening of P
in PBT/vPvB;
 information on the octanol-water partitioning
coefficient
experimentally
determined
in
accordance with Section 7.8 of Annex VII will be
used to screen for B in PBT/vPvB;
 if the above screening for P and B identifies that a
substance may meet the criteria for both P and B
(or vP and vB), information will be gathered as per
Section 9.1.3 of Annex VIII, short-term toxicity
testing on fish (if it has not already been gathered
as part of the option). This will be used to screen
for T in PBT;
 if the above screening identifies the substance as
a potential PBT or vPvB, any additional
information to make an assessment will be
gathered in accordance with Annex XIII of REACH.
Maintain as at present (i.e. not required)
As Annex VII+
Allows the detection of PBT/vPvB
substances (where no detection occurs
at
present
because
PBT/vPvB
assessment is a requirement of Annex
XIII alone and this Annex does not apply
to 1-10t substances)
As Annex VII+
N/A
Phase 2 1-10t Study: Final Options for Extending Information Requirements
RPA | 31
4 Summary of Methods used to Analyse Options
4.1 Overview
An Excel® based Monte Carlo simulation model has been developed to analyse and explore the
options and the baseline (current requirements) in terms of the following five key performance
measures:





the number of substances with hazardous properties detected;
the usefulness of the information generated on these substances in the context of the
regulation of risks and risk management;
the cost of registering the 1-10t substances (including the generation of information);
the likely impact of registration costs at a company level considering that companies will be
registering several substances (a portfolio) sometimes as part of a joint (consortium)
registration and sometimes as an individual registration; and
considering the above, to the extent possible, the likely impacts on competition and
innovation.
Comparison of the options with the baseline provides information on the incremental cost and
benefit of changing requirements for 1-10t substances to fit that option.
Uncertainties
As with previous ex-ante studies on REACH (such as the various Business Impact Assessments – BIAs
and studies on REACH benefits), the model and analysis must make predictions on the outcomes
based on the best available information of what the outcomes are likely to be (rather than what they
certainly are). Here, for example, REACH is based on the presumption that, due to the lack of data of
on a significant percentage of substances, the existence of further hazardous substances is
suspected but the exact number is not known. In other words, for those registrations yet to be
completed (including the 1-10t substances), there is no certain knowledge concerning the number of
these that possess hazardous properties and may be identified as such in the course of registration.
It is important to note that there is also no certain knowledge on other factors including:






The exact number of 1-10t substances;
The exact number of substances that will be identified by QSARs and other evidence as
priority substances (correctly or incorrectly) and will be required to generate toxicological
and ecotoxicological information;
The exact cost of generating the necessary toxicological and ecotoxicological information for
those substances;
The exact cost of producing registration dossiers for 1-10t substances;
The exact number of companies that will be registering one or more substances in the 1-10t
band and the size of those companies (micro, small, medium and large); and
The exact number of registrants for each substance and the cost sharing arrangements that
will be made between the companies registering (where there is more than one
manufacturer/importer).
REACH 1- 10 tonnes Phase 2
RPA & CSES | 32
In order to provide an analysis, then, the modelling and simulation must rely on informed prediction
of factors including the above to provide a best estimate of the five performance measures for each
option and the baseline. The outputs of the model are, then, sensitive to the input values used.
However, where previous assessments (such as the BIAs) predicted the total costs of the regulation
as a whole, the analysis of options for the 1-10t substances is focussed on the incremental costs and
benefits of the options when compared with the baseline (i.e. the difference between the options
and the baseline). This makes the current analysis far less sensitive to the underlying inputs and
assumptions on the factors described above because the same assumptions apply across all of the
options including the baseline. Here, of the factors described above, only two differ from one
option to the next. These are:


the number of substances that will be required to generate the toxicological and
ecotoxicological information required under the option; and
the additional cost of any further information required under an information option.
All of the other factors are consistent between the options and the baseline, making the analysis
much less sensitive to these assumptions and inputs.
Modelling Approach Applied
In order to model the costs associated with the options (and the baseline) a Monte Carlo simulation
approach has been applied to allow the full range and spread of costs to be examined rather than a
simple average (which provides little information of use to exploring business impacts). Here, the
costs of registering any given substance depend on a number of factors including (but not limited
to):








Whether there is already toxicological or ecotoxicological information on that substance or
whether there is some or none;
Whether that substance is identified by QSARs or other evidence as meeting one or more of
the criteria in Annex III (or variants of in the options) and, hence, must generate the
toxicological and ecotoxicological information in Annex VII (or variants of in the options);
The properties of that substance. For example, whether the substance is a CMR/non-CMR,
is acutely toxic, etc. (where this determines what further testing may be required under the
options);
The outcome of screening tests and, in particular, those for mutagenicity (where a positive
result will require that further testing is undertaken);
The number of companies registering that substance (which influences both the sharing of
information costs in a SIEF and also the cost of administering a SIEF);
Whether the registrants of that substance will all support a joint registration or whether one
or more individual registrations will be submitted also;
The size of the companies registering that substance (which determines the registration fees
due and also allows exploration of the impacts on SMEs versus larger companies); and
The volumes produced by each of the companies registering that substance (which has an
influence on the impact of the costs on companies and downstream users because it
provides an indication of the price increase per unit of manufacture).
Clearly, different permutations of the above have different results in terms of the cost of registering
different substances. In addition, the number of possible permutations is very large (a few thousand
possibilities). Some permutations will result in relatively large costs of registration and some
REACH 1- 10 tonnes Phase 2
RPA & CSES | 33
relatively low costs. The Monte Carlo simulation model explores the different permutations,
calculating and recording the costs associated with each. The probability of each permutation is
governed by the individual probability of each factor. In the Monte Carlo simulation these
probabilities have been derived by consideration of statistical data and, where not available,
assumptions.
When it is run, the Monte Carlo simulation model generates a series of ‘virtual registrations’ for
substances. For each ‘virtual registration’, the model generates a permutation (using the
probabilities mentioned above) and calculates the resulting cost for each of the registrants under
each of the options (and the baseline). The model repeats this 20,000 times (once for every 1-10t
substance expected to be registered) in each case recording the identity of the substance (as a
numbered code), the identity of the registrants (as a numbered code) and the cost of registration for
each of those registrants. In this way the model produces around 88,600 rows of data, each row
giving the costs of registering a substance for an individual company under each of the options (and
the baseline). These data have then been aggregated by company and also by substance.
For the benefit of transparency, all of the assumptions and numbers underlying the modelling and
probabilities for the Monte Carlo simulation are described in detail in Annex 2 of this report. These
were supplied to and agreed by the Commission in advance so that the subsequent analysis can be
based on an agreed set of numbers and assumptions.
The following sections provide an overview of the key data and assumptions used for estimating the:

number and nature of substances: estimation of the number and nature of hazardous
properties within the population of 1-10t substances;

number of substances requiring toxicological and ecotoxicological information: estimation
of the number of substances that will be identified by QSARs and other evidence as priority
substances and will be required to generate toxicological and ecotoxicological information;

substance costs of testing and information: estimation of the cost of generating the
necessary toxicological and ecotoxicological information for substances;

substance registration costs: estimation of the costs of registration including dossier
preparation, sharing of information, administration costs of joint registrations, fees, etc.

aggregation of costs:
manufacturer/importer.
calculation
of
overall
costs
by
substance
and
by
4.2 Number and Nature of Substances
The starting point for the modelling has been information that describes the ‘population’ of 1-10t
substances in terms of:


The total number of 1-10t substances impacted by the options;
The number of these substances possessing properties that are hazardous to human health
or the environment or both and would be classified if information were available to make a
classification; and
REACH 1- 10 tonnes Phase 2
RPA & CSES | 34

For the above substances, the nature of those hazardous properties given the spectrum of
different properties and their relative significance (for example, the detection of a mutagen
is likely to be more significant than the detection of a skin irritant).
4.2.1 Total number of 1-10 substances impacted
It is estimated by ECHA that full registration for 20,000 unique phase-in substances will be submitted
in the 1-10t band alone in/by the 2018 deadline. These are substances yet to be registered that will
not also be registered in higher tonnage bands. In addition, 46 unique substances have already been
fully registered in the 1-10t band only owing to their known C, M or R 1A/1B properties and the
requirements to register these earlier (under Article 23(1)(a) of REACH).
In addition to substances registered only in the 1-10t band, there will be some 1-10t registrations for
substances also registered in higher tonnage bands (i.e.>10t per year). However, information
equivalent to Annex VIII and above is already required for ALL of these substances. Accordingly,
there is no effect or benefit from applying the options to these substances (as information in excess
of that required under the options is already required and classifications communicated to
downstream users and distributors).
4.2.2 Number of substances with hazardous properties
Based on information from ECHA, the 20,000 1-10t substances have been divided into estimates of
the number of substances with and without hazardous properties. For those substances predicted
to have hazardous properties, data from the classification and labelling inventory (CLI) has been
used to predict the number of substances that would be identified as meeting different
classifications if all substances were subjected to toxicological and ecotoxicological testing (including
in vivo testing for mutagenicity).
Owing to the fact that the CLI database may contain multiple self-classifications for a number of
substances, the CLI is not ideal for the purpose of predicting the likely hazardous properties of the 110t substances. However, the only alternative approach is to use entries for harmonised
classifications on the CLI (to eliminate the influence of multiple classifications for the same
substance). The list of substances for which a harmonised classification has been determined is
relatively short (4,509 substances) compared with that of the full CLI (117,917) and, in addition,
harmonisation has been prioritised towards those substances with the most hazardous properties.
Thus, use of harmonised classifications alone for predicting the properties of the 1-10t substances is
likely to exaggerate the number and nature of the hazardous properties. For these reasons,
although still not perfect, data from the full CLI has been used for prediction of properties of the 110t substances21.
21
Note: The original analyses undertaken for the BIA were based on a 2005 ECB spreadsheet on the number
of substances with certain R-phrases in the New Chemicals Database (NCD). We have attempted to cross
check estimates with those from the ECB analysis of the NCD but it is not possible to extract this
information from the data presented in 2005.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 35
4.3 Number of Substances Requiring Toxicological
Ecotoxicological Information under the Options
and
4.3.1 Overview
Having predicted the number of substances that would be identified as meeting different
classifications if all substances were subjected to toxicological and ecotoxicological testing (including
in vivo testing for mutagenicity), the Monte Carlo model estimates the number of substances that
would be required to generate the full toxicological and ecotoxicological information appropriate to
each option (and the baseline) which, in turn, determines the number of hazardous substances and
properties that will be detected under each option.
It should be noted that none of the options under examination involve in vivo mutagenicity testing,
only options cover all of the substances and some options include additional tests. Thus, options
vary in terms of:


The test endpoints included and the screening/testing strategies applied to substances
required to gather toxicological and ecotoxicological information (information options VII,
VII+ and VII++); and
The number of substances actually required to generate toxicological and ecotoxicological
information (the Annex III options).
In relation to the latter (the number of substances required to generate information), under the
current requirements only “priority substances between 1 and 10 tonnes” are required to generate
toxicological and ecotoxicological information. These priority substances are “substances for which
it is predicted (i.e. by the application of (Q)SARs or other evidence) that they are likely to meet the
criteria for”:


classification as C, M or R 1A/1B or PBT/vPvB; or
any health or environmental hazard classes or differentiations under CLP and have a
dispersive or diffuse use.
The starting point for modelling of the baseline and Annex III options is the estimation of the
numbers of “substances for which it is predicted (i.e. by the application of (Q)SARs or other evidence)
that they are likely to meet the criteria for classification”. The model considers ‘evidence’ in the
following order:

Step 1: Existing test information – some substances will already have some test results on
some endpoints. The model estimates this number and therein the numbers of substances
likely to be identified as being likely to meet criteria for CMR 1A/1B and PBT/vPvB based on
this existing information. The substances that are not identified as such are then
considered in Steps 2 and 3;

Step 2: Application of Read Across (RA) - RA is a technique used to predict endpoint
information for one substance by using data for the same endpoint from another substance
which is considered to be similar in some way (on the basis of structural similarity and
similar properties and/or activities). The model estimates the number of substances for
which information from RA might be applied. It then estimates the number of substances
REACH 1- 10 tonnes Phase 2
RPA & CSES | 36
likely to be identified as likely CMRs 1A/1B, PBTs/vPvBs or other HH or ENV classifications;
and

Step 3: Application of (Quantitative) Structure Activity Relationships ((Q)SARs) - A SAR is a
qualitative relationship that relates a (sub)structure to the presence or absence of a
property or activity of interest. A QSAR is a mathematical model (often a statistical
correlation) relating one or more quantitative parameters derived from a chemical structure
to a quantitative measure of a property or activity. The model estimates the number of
substances for which information may be derived from (Q)SARs and, therein, the number of
substances likely to be identified as likely CMRs 1A/1B, PBTs/vPvBs or other HH or ENV
classifications.
4.3.2 Step 1: Number of substances with existing test information
For some 1-10t phase-in substances there will already be some data available on some endpoints
and this will provide information to screen against the Annex III criteria. In terms of the number of
substances with full test information, RPAs 2006 Revised BIA drew numbers from the 2006 ECB
assumptions on the percentage of substances with a complete data set. These, in turn, were mainly
drawn from the original Business Impact Assessment of the White Paper (which also drew on data
from an ECB and a Danish Study). All of these studies assumed that 17% of 1-10t substances have a
complete set of Annex VII data (and others have none). In the 2012 Phase 1 analysis, these figures
were altered in analogy to data on actual percentages of the higher tonnage substances having some
but not all data.
Drawing on and combining estimates from all of these sources, the Monte Carlo model used in this
(current) study assumes the following (where more detail is provided in Annex 2, Section A2.2.3):



17% of the 1 to 10 tonne substances have data on all Annex VII endpoints;
13% of the 1 to 10 tonne substances have data on some endpoints;
the remainder (70%) have no data on human health and environmental endpoints.
Applying these percentages to the predicted number of substances with different types of hazardous
properties provides an estimate of the number of substances that would satisfy each of the criteria
in Annex III and, hence, the number of substances that would be required to generate toxicological
and ecotoxicological information under the options that apply Annex (or aspects of).
4.3.3 Steps 2 and 3: Application of Read Across (RA) and QSARs
For the remaining substances (those with little or no information from testing22) information is
assumed to be sought from the application of QSARs and other information such as Read Across (RA)
as per Annex III. However, it is important to note that Annex III does not specify in detail what is
required in relation to these and other tools. This issue was highlighted early in the study’s
timeframe and both the Commission and ECHA have agreed that the requirements of Annex III
probably need to be specified in more detail to ensure that the prioritisation process achieves what
22
The 70% with no information from testing and those of the 13% where there is some testing information but
none of that information suggests a classification.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 37
is intended (to the extent possible given the technical limitations of the tools available). The
Commission and ECHA agreed to provide guidance to 1 - 10 t registrants on this issue in 2015.
For the purposes of the analysis (and the Monte Carlo model), based on a review of the work
undertaken in 2006 by RPA for DG Enterprise23 and also in view of the current wording of Annex III,
the following interpretation has been applied:

Screening Tools are used (without expert judgement): Annex III is applied based on existing
data and QSAR-screening and similar ‘quick scans’ (such as RA) without the use of expert
judgement24. There are many freely available tools that might be used for this purpose with
the main tools currently available being the Analog Identification Methodology (AIM),
Danish (Q)SAR database, Toxmatch, and the OECD QSAR Toolbox. Manufacturers and
importers would obtain one or more such tools and apply them in-house or commission a
QSAR consultancy to obtain results from similar/the same QSAR tools;

A positive decision rule applies: to be identified as a priority 1-10t substance, there must be
positive evidence of hazardous properties; and

Absence of evidence equates to absence of effects: By extension of the above, the absence
of evidence is taken as absence of effects25. This includes cases/substances where there is no
existing test information and no prediction by QSARs (or other approaches) can be made (for
example, because a substance is out of the ‘domain’ of a QSAR model). The latter
substances would not be 1-10t priority substances (and no new toxicological or
ecotoxicological information would be generated under REACH).
Step 2: Application of Read Across (RA)
Reviewing available information, the 2012 Phase 1 study on 1-10t substances made tentative
conclusions on the ability of RA to provide information on a range of test endpoints. This review
suggested that RA might be applied to around 11% of substances. Accordingly the Monte Carlo
model assumes that RA can be successfully applied to identify the hazardous properties of 11% of
substances for the purposes of the screening for Annex III. In other words, RA can be successfully
applied (and likely properties and HH and ENV classifications can be predicted) for 11% of
substances which currently have little or no information.
23
As part of the Technical Assistance for REACH Impact Assessment Updates focussing on the then (2005)
Common Position Text and also the Recommendation for the Second Reading (Sacconi, (2006 : ***II
Recommendation for Second Reading, Session document of the European Parliament, Final A6-0352/2006,
dated 13.10.2006).
24
The alternative would be robust QSARs of the sort described in Annex XI 1.3. Such QSARs would be
expensive to apply owing, in part, to the need for expert judgement. According to ECHA representatives
(pers comm, 2014) this makes such QSARs potentially as costly or more costly to apply than undertaking
the equivalent in vitro test. This would not be consistent with the objective of Article 12 and Annex III to
reduce the burden on low volume substance manufacturers.
25
The absence of evidence of effects is not generally otherwise accepted as evidence of absence of effects.
See
for
example
Danish
experience
on
regulatory
use
of
QSARs
https://echa.europa.eu/documents/10162/13639/qsarws_wedebye_tule_en.pdf
REACH 1- 10 tonnes Phase 2
RPA & CSES | 38
Step 3: Application of (Quantitative) Structure Activity Relationships ((Q)SARs)
QSARs are assumed to be applied to all substances with little or no information and for which RA
cannot be successfully applied.
A detailed review of QSARs and their applicability to (and adequacy for) various information
requirements under REACH was undertaken as part of the Phase 1 study in 2012. In that study (and
in the 2006 study for DG Enterprise) two key factors were considered in relation to the applicability
and accuracy of QSAR predictions. These were:


QSAR domain: The domain of applicability specifies a group of molecular structures for
which the model is applicable. For molecule structures outside of this domain the model is
not applicable; and
QSAR Performance: the extent to which the QSAR for a given endpoint is able to correctly
predict outcomes.
In both the 2006 and 2012 studies, the focus of the latter factor (performance) was on the correct
identification/detection of substances with hazardous properties (true positives) as opposed to the
incorrect attribution of hazardous properties to a substance not possessing these properties (false
positives). This is because the emphasis of these studies was on the use of QSARs as an alternative
to in vitro and/or in vivo testing rather than screening.
For this, Phase 2 study, the emphasis of is on the use of QSARs for screening of substances and the
determination of whether they are ‘priority 1-10t substances’. This means that there is a need to
better consider the number of false positives (and false negatives) as well as the true positives (and
true negatives) by breaking ‘performance’ down into its composite factors of sensitivity and
specificity where:

sensitivity expresses the extent to which a given QSAR for an endpoint is able to correctly
identify substances with hazardous properties (for that endpoint) - this is expressed as a
percentage substances correctly identified; and

specificity expresses the extent to which a given QSAR for an endpoint is able to correctly
identify substances without hazardous properties (for that endpoint) - this is expressed as a
percentage substances correctly identified as non-hazardous for that endpoint; and
Where possible, percentages applied in the Monte Carlo model are based on consideration of actual
data on typical QSAR performance for different endpoints. Where data for an endpoint are not
available from such studies, assumed values have been used based on the ‘poor, fair, good’
performance indications that were the outcome of the aforementioned review undertaken for the
Phase 1 study.
In terms of QSAR domain, the Monte Carlo model applies the percentages derived in the Phase 1
detailed review of QSAR methods (more detail is provided in Annex 2, Section A2.3.3).
REACH 1- 10 tonnes Phase 2
RPA & CSES | 39
4.3.4 Resulting estimates of the number of substances requiring toxicological
and ecotoxicological information
Applying all of the modelling steps set out above provides information on the number of substances
likely to be required to generate toxicological and ecotoxicological information under each of the
options and the baseline. Here, options vary between one another and the baseline depending on
the extent to which substances satisfy the criteria in Annex III and, in particular, whether the QSARs
or other information indicates that one or more of the criteria are satisfied. For options involving
the removal of Annex III and it’s criteria, all substances are required to generate toxicological and
ecotoxicological information.
The numbers of substances requiring toxicological and ecotoxicological information under each
option and the baseline are provided in Table 4.1. The substances identified are those that meet the
following criteria in each case:



baseline – substances identified by the application of QSARs or other evidence as likely to
meet classification as CMR1A/1B or PBT/vPvB and substances with diffuse/dispersive uses
(assumed to be 40% of substances) likely to meet any other human health or environmental
classification;
Annex III no diffuse/dispersive option - substances identified by the application of QSARs or
other evidence as likely to meet classification as CMR1A/1B or PBT/vPvB and all other
substances likely to meet any other human health or environmental classification; and
no Annex III option – all substances required to gather information.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 40
Table 4.1: Numbers of substances requiring toxicological and ecotoxicological information by application of the Annex III options
No Annex III
No diffuse/dispersive use criterion in
Annex III
Availability
Type of hazardous properties
Number of
CMRs
Potential
Number of
CMRs
Potential
Number of
of existing
(HH – Human Health
Substances
PBTs/
Substances
PBTs/
Substances
test
ENV – Environmental)
to Annex
vPvBs
to Annex
vPvBs
to Annex
information
VII
VII
VII
Test
With HH and ENV properties
578
16
12
578
16
12
336
information With HH (not ENV) properties
1,700
47
34
1,700
47
34
989
available on With ENV (not HH) properties
204
0
4
204
0
4
117
all endpoints Substances with no properties
918
0
0
252
0
0
252
matching any HH or ENV class
Test
With HH and ENV properties
442
12
9
412
12
9
213
information With HH (not ENV) properties
1,300
36
26
1,212
36
26
625
available on With ENV (not HH) properties
156
0
3
67
0
3
47
some
Substances with no properties
702
0
0
163
0
0
128
endpoints
matching any HH or ENV class
No
With HH and ENV properties
2,380
66
47
1,536
42
21
958
information With HH (not ENV) properties
7,000
193
140
4,300
121
61
2,727
available
With ENV (not HH) properties
840
0
17
507
0
8
322
Substances with no properties
3,780
0
0
1,632
0
0
1,231
matching any HH or ENV class
Total
With HH and ENV properties
3,400
94
68
2,526
70
42
1,507
With HH (not ENV) properties
10,000
276
200
7,212
204
121
4,341
With ENV (not HH) properties
1,200
0
24
778
0
15
486
Substances with no properties
5,400
0
0
2,047
0
0
1,611
matching any HH or ENV class
REACH 1- 10 tonnes Phase 2
RPA & CSES | 41
Baseline
CMRs
Potential
PBTs/
vPvBs
11
33
0
10
28
3
0
0
9
26
0
9
26
3
0
0
38
111
0
19
57
7
0
0
58
170
0
38
111
13
0
0
4.4 Cost of Information Gathering
4.4.1 Cost of Standard Information Required under the Options
All substances identified by the model as requiring toxicological and ecotoxicological information
under the relevant Annex III scenario must gather the information appropriate to the Information
Option (current Annex VII, Annex VII+ or Annex VII++).
The costs applied to the standard information requirements (and further information as required)
have been drawn from the 2012 CEFIC testing catalogue which lists the average cost of testing for
each endpoint. For costs not included in the CEFIC test cost catalogue the following have been
applied:



Cost of QSARs for Annex III – the Phase 1 study estimated the costs at around €1,500 per
substance for the QSAR models without expert interpretation. This was based on
discussions with laboratories providing QSAR information but equally could apply to inhouse assessments using QSAR software which might be expected to take around 1.5 days.
When undertaking new QSAR/RA work for the purpose of assessing the substance against
the criteria in Annex III it is assumed that there is no duplication of effort between
registrants and that a lead registrant takes on the task (but the cost is shared between the
registrants as per the testing costs);
Cost of Screening for PBT/vPvB Properties – PBT/vPvB screening requires cross checking the
results of tests with the screening criteria in Annex XIII. The Monte Carlo model assumes
this would cost around €500 per substance (i.e. a half person day).
Further testing for PBT/vPvB Assessment – further testing and assessment applies to those
substances identified as potential PBT/vPvB by screening. The costs of testing and
information may vary considerably. The Monte Carlo model assumes that the cost of further
information is €20,000.
The information costs for the standard information elements are summarised in Table 4.2.
Cost of purchasing existing test data
In the case of substances where information on some or all endpoints in Annex VII is already
available, other registrants of the substance will have to buy access to that information from the
owner of that information. The Monte Carlo model assumes that the owner of that information is
one of the registrants and that the current value of that information is equivalent to the sum of the
costs of the relevant tests in the CEFIC testing catalogue.
In previous studies such costs were not considered as they represent a transfer payment between
companies that make up ‘industry’; thus the net cost of the information is zero viewed across
‘industry’ as a whole. The (new) Monte Carlo model, however, seeks also to examine the impact of
costs on companies. The need to make such transfer payments may be important to those having to
make them (particularly SMEs) and so it is important to reflect them. Costs of existing test
information are still a net zero at an ‘industry’ level because the payment made is credited to
another company.
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Table 4.2: Costs of Testing and Information
Cost component
Cost of QSARs for Annex III
Annex VII 8.1. Skin irritation/ corrosion - In vitro skin corrosion/irritation
Annex VII 8.2. Eye irritation - In vitro eye irritation
Annex VII 8.3. Skin sensitisation - In vivo LLNA
Annex VII 8.4.1 GMbact: gene mutation test in bacteria (Ames test)
Annex VIII 8.4.2 CAbvitro, in vitro chromosome aberration test
Annex VIII 8.4.2 MNTvitro, in vitro micronucleus test
Annex VIII 8.4.2 MNTvitro/CAbvitro (weighted average based on % conducting MNTvitro)
Annex VIII 8.4.3 GMvitro:gene mutation assay in mammalian cells
Annex IX 8.4.4 Cytvivo:cytogenetic assay in experimental animals
Annex VIII 8.4.3 GMvivo:gene mutation assay in experimental animals - Mouse
micronucleus assay
Annex VII 8.5. Acute toxicity - Oral toxicity
Annex VIII 8.5.2. Acute toxicity - Toxicity via Inhalation
Annex VIII 8.5.3. Acute toxicity - Toxicity via Dermal routes
Annex VIII 8.6.1. Repeat dose toxicity - Short term (Oral)
Annex VII 9.1.1. Aquatic Toxicity - Invertebrate - short-term
Annex VII 9.1.2. Aquatic Toxicity - Algal - short-term
Annex VIII 9.1.3. Aquatic Toxicity - Fish – short-term
Annex VII 9.2.1.1. Degradation - Biotic - Ready biodeg
Cost of Screening for PBT/vPvB Properties
Further testing for PBT/vPvB Assessment (once identified by screening)
Cost (€)
€ 1,500
€ 2,580
€ 1,552
€ 7,117
€ 3,465
€ 20,080
€ 16,518
€ 17,231
€ 17,615
€ 27,730
€ 12,620
€ 1,486
€ 12,267
€ 2,486
€ 52,925
€ 5,232
€ 5,806
€ 4,845
€ 3,705
€ 500
€ 20,000
4.4.2 Cost of Information on Mutagenicity under the Options
All substances completing the full toxicological and ecotoxicological information requirements under
the baseline and the further information options are required to gather data in relation to the Annex
VII gene mutation screening test (GMBact) (and the CAbvitro/MNTvitro in the case of the Annex
VII++ Option). In the event of there being no positive results in the screening test(s), it is concluded
that the substance is non-genotoxic and no further testing is required. However, in the event of a
(true or false) positive result in screening, substances are required to gather additional data from
Annex VIII and above according to ECHA “Guidance on Information Requirements and Chemical
Safety Assessment - Chapter R.7a: Endpoint Specific Guidance”
To attribute the appropriate cost for additional information, the Monte Carlo model considers
substances predicted in the model to have CMR 1A/1B properties and those that are not (nonCMRs). Sensitivity data26 for the different tests are applied to the numbers of CMRs to identify the
outcome of each test in terms of the number of true positives (TPs) and false negatives (FNs)
26
From the UK Committee on Mutagenicity of Chemicals in Food, Consumer Products and the Environment
(COM) (2011) Guidance on a Strategy for Genotoxicity Testing Of Chemical Substances.
http://www.iacom.org.uk/guidstate/documents/COMGuidanceFINAL.pdf (itself based on Kirkland, D.,
Aardema, M., Henderson, L., Müller, L. (2005): Evaluation of the ability of a battery of three in vitro
genotoxicity tests to discriminate rodent carcinogens and non-carcinogens: I. Sensitivity, specificity and
relative predictivity, Mutation Research - Genetic Toxicology and Environmental Mutagenesis, 584 (1-2),
pp. 1-256)
REACH 1- 10 tonnes Phase 2
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identified. Specificity data are applied to the numbers of non-CMRs to identify the number of false
positives (FPs) and true negatives (TNs).
In terms of the further studies that are required for substances showing a positive result in the
screening, there are a number of combinations depending on the results obtained from each
successive test suggested by the ITS. The results can be predicted statistically by applying the
relevant sensitivity/specificity value to the outcome of the previous test. In this way the Monte
Carlo model uses a cascade approach to predict how many substances are likely to carry out which
combination of further mutagenicity tests and costs are applied.
4.5 Substance Registration Costs
4.5.1 Overview
The cost of generating toxicological and ecotoxicological information represents only one element of
the costs of registration. To these information costs must be added:






Registration Dossier costs - the costs of drafting and finalising a registration dossier for
submission;
Cost of producing study summaries – which varies from information option to information
option (because of differences in the information generated by different options) and
outcome in terms of any further mutagenicity testing and/or PBT/vPvB assessment;
Joint registration and SIEF administrative costs - where there is more than one registrant of
the substance, the costs of liaising with the other registrants as part of sharing information
on the substance (Substance Information Exchange Fora – SIEFs), sharing the costs of that
information, preparing the registration dossier and other technical and administrative liaison
costs;
Costs of revising Substance Safety Data Sheets (SDSs) – where there is a change in
classification for a substance in the light of any new information generated;
Costs of proposals for animal tests – where there is a need to undertake animal testing by
virtue of following the ITS for mutagenicity or for PBT/vPvB assessment; and
Registration fees – which vary by size of enterprise (micro, small, medium and large).
Owing to the fact that registrations for 1-10t substances are substantially different from the much
larger dossiers that must be produced for higher tonnage substances (which, include, for example, a
CSA) there is little or nothing that can be drawn from the experience of registrations submitted for
the higher tonnage substances (>100t per year).
The following sub-sections provide a description of the cost estimation and application of costs in
the Monte Carlo model. With the exception of fees (which are fixed by Regulation), the cost of each
component has been estimated by consideration of likely time and effort for each element. Some of
the cost elements described above will be similar from one substance to another but most will vary
depending on a range of factors including the extent to which further testing has been undertaken
(and must be summarised), the number of other manufacturers and importers (M/Is) and the size of
the M/I enterprise.
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4.5.2 Registration Dossier costs
Registration dossier costs relate to the general compilation of material for the dossier including
physico-chemical information, general administration of the submission and liaison with ECHA. The
costs of providing study summaries in the dossier are considered separately as these vary depending
on the information gathered for a substance.
Two levels of information are relevant for the registrations of 1-10t substances; registrations for
substances needing only to provide physicochemical information and registrations for substances
providing full toxicological and ecotoxicological information.
For both levels, the Monte Carlo model distinguishes between joint registrations (by a consortium of
manufacturers and or importers - M/Is) and individual registrations (by single M/Is). The latter may
occur either where there is only one M/I of a substance or in situations where one or more members
of a consortium decide to make a separate (individual) submission of their own.
The Monte Carlo model also distinguishes between dossiers compiled and submitted by M/Is of
different sizes, with separate costs applied for micro, small, medium and large enterprises on the
broad assumption that in-house expertise and experience is less developed in smaller companies
and this affects the time taken to compile and submit a dossier (and increases the costs).
4.5.3 Cost of producing study summaries
The total cost of producing study summaries for presentation in the dossier depends on the number
and nature of the testing studies undertaken. In the Monte Carlo model, these are calculated
alongside the costs of testing as an additional cost of summarising the results of the test. All costs
are based on estimated time for a toxicologist (whether in-house or consultant) at €1,000 per day.
4.5.4 Joint registration and SIEF administrative costs
Joint registration and SIEF administrative costs are associated with time spent by each M/I when
engaging with other registrants on shared information (as part of SIEFs) and also on the preparation
of the dossier. Costs applied are as follows:


Cost of engaging on information (applies to each registrant) = € 1,000 per M/I registering;
and
Cost of engaging on dossier preparation (applies to each registrant in a consortium) = € 750
per M/I jointly registering.
For registrations that only include only physico-chemical information, costs are 80-90% of the above.
4.5.5 Costs of revising Substance Safety Data Sheets (SDSs)
In the event that additional information under REACH results in a change in classification for a
substance, there is a need to update the SDS for the substance. The Monte Carlo model applies a
cost of €500 per substance for updating the SDS.
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4.5.6 Costs of proposals for animal tests
Before animal tests are carried out a proposal for animal testing must be submitted to ECHA. The
Monte Carlo model applies a cost of €500 per proposal per substance.
4.5.7 Registration fees
Registration fees and charges that apply to different sizes of enterprise are established under
Commission Regulation27. The fees relevant to registration of 1-10t substances are provided as
Table 4.3. Under Article 74(2) of REACH these fees do not apply when full toxicological and
ecotoxicological data are provided and this is accounted for in the Monte Carlo model.
Table 4.3: Registration fees for 1-10t substances (€ per M/I per substance)
Individual
Micro enterprises
€ 86
Small enterprises
€ 600
Medium enterprises
€ 1,114
Large enterprises
€ 1,714
Joint
€ 64
€ 450
€ 835
€ 1,285
4.6 Aggregation of costs using the simulation
The overall cost of registration for a substance depends on a number of factors where these include:




whether (and how much) toxicological and ecotoxicological information is required (or not);
the number of manufacturers and importers (M/Is) submitting a registration for the
substance;
the number of these M/Is that will be part of a joint submission and the number that will
submit an individual submission; and
the size of the M/I enterprise(s) registering a substance.
To provide an assessment of costs and impact, the Monte Carlo model considers one substance at a
time, calculating costs and impact using a simulation that describes the likelihood of the different
situations, factors, events and M/I joint/individual registration composition for each substance. A
full description is provided in Annex 2, Section A2.6.1) however, in simple terms, for each substance
the modelled simulation carries out the following steps in order:

Step 1: Property profile and pathway - the Monte Carlo model generates a profile and
pathway through registration and information according to the option. This profile is
developed probabilistically using the data and assumptions already described in relation to
substance properties which dictates:

27
whether a substance must generate toxicological and ecotoxicological information
under each of the options;
Regulation No 340/2008 of 16 April 2008, as amended by the Commission Implementing Regulation (EU) No
254/2013 of 20 March 2013.
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


Step 2: Number of M/Is registering - the Monte Carlo model allocates a number of M/Is
registering the same substance;

Step 3: Size of M/Is registering - having assigned a number of M/Is to the substance in Step
2, the Monte Carlo model then assigns a code denoting the size of each of the M/Is
registering the substance (micro, small, medium or large). This is done in different ways for
different substances and registrants depending on whether there is existing test information
on the substance according to the modelled outcomes of Step 1:




28
the cost of generating the information for an option for that substance considering
the available information and the need to purchase any existing test information
from the owner versus generate new information;
whether a substance meets any of the criteria requiring further studies for
mutagenicity and/or PBT/vPvB assessment and, therein, the costs of providing that
information (and summarising it in a dossier).
For substances for which information on all current Annex VII endpoints already
exists the modelled simulation assumes that the first registrant (or only registrant in
the case of substances where there is only one M/I) owns that information and that
this M/I is a large enterprise;
For substances for which information on some Annex VII endpoints already exists
the modelled simulation assumes that the first registrant (or only registrant in the
case of substances where there is only one M/I) owns that information and that
there is a 75% chance that this M/I is a large enterprise and a 25% chance that it of
medium size; and
For all other M/Is registering (and for all substances for which there is no
information), the Monte Carlo model assigns a size group to each of the M/Is on the
basis of probability. Here, logically, the probability that an M/I may be micro, small,
medium or large is a function of the numbers of M/Is of each different size expected
to submit registration dossiers for 1-10t substances and the average number of 110t substances to be registered by each (the portfolio size).
Step 4: Joint versus individual registration submitted – where there is only one M/I the
registration for the substance is, by default, an individual registration. Where there is more
than one M/I the Monte Carlo model determines whether all manufacturers will submit a
joint registration or whether the consortium will break into both joint and individual
registrations. The simulation assumes that in 70% of cases all M/Is submit a single joint
registration. This leaves a 30% probability of there being a joint registration plus one or
more individual registrations for a substance28. The simulation assumes that, where this
occurs for a substance, between 20% and 30% of the M/Is registering that substance will
submit individual submissions and the remainder will submit jointly. For each substance, the
This is higher than for registrations in 2010 for >1000t substances. This is to reflect the fact that speciality
chemicals may comprise a more significant proportion of the number of substances in the 1-10t band and
MIs may not wish to share information on the specialised (and hence potentially commercially sensitive)
uses of substances.
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Monte Carlo simulation model randomly selects a percentage value between these two
ranges (20-30%).
Applying the above steps, the modelled simulation allocates the appropriate cost to the individual
and/or joint registration of the substance accounting for the size of the M/Is (which affects the
registration dossier costs), the number of M/Is (which affects the costs of SIEFs and administration of
the joint registration) and the property profile and pathway of the substance (which affects costs of
testing and information, updating the SDS, proposals for animal tests, study summaries).
Where there is more than one M/I registering a substance, some costs are shared between all
registrants regardless of whether it is a joint registration or a mixture of joint and one or more
individual registrations. These costs comprise testing and information costs, participation in SIEFs,
study summaries and SDS costs. Where there is a joint registration, registration dossier submission
costs are shared between the members of the consortium only and where there are individual
registrations the appropriate individual registration cost applies. Where test information exists, the
cost of access to this information is shared between all but the first registrant (who is assumed to
own the information). All cost sharing between members of the consortium is allocated on the basis
of the tonnes produced by each manufacturer. Finally, the appropriate fee is allocated to each
manufacturer.
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5 Cost Estimation
5.1 Approach to Estimation
5.1.1 Monte Carlo Outputs
Applying the approaches, data and assumptions described in Section 4.1, the Monte Carlo simulation
produces around 88,600 rows of data on the registration of 20,000 ‘virtual’ 1-10t substances.
Each row of data records the cost of registering an individual substance (under the baseline and
each option) for each individual M/I. As the assumptions and data underpinning the Monte Carlo
modelling allow for between one and 15 MIs of each substance, there can be anything between one
and 15 rows of data for the registration of an individual substance with each row providing
information on the:






identity of the MI (as a numbered code);
size of the MI (micro, small, medium or large);
identity of the substance being registered by the MI (as a numbered code);
volume of that substance currently produced by that MI (always between 1 and 10t29);
cost of the registering that substance (under the baseline and each option);
other useful descriptors (such as whether mutagenicity tests or PBT assessment was
required for that substance, etc.)
Because the Monte Carlo simulation provides information in this way it is a powerful tool for
assessing the costs of registration (under the baseline and the option) at either a substance level or a
company level.
Substance Level
When the 88,600 rows of data are ordered and grouped by the identity of the substance (using pivot
tables), total values for the registration of each substance are equal to the totals across each of the
MIs registering that substance. Here, as noted above, each row of data provides information
describing the volumes of production and cost of registration for each individual MI registering that
substance and there can be anything between one and 15 rows of data for each substance. So, at a
substance level, it is relatively simple to use data analysis tools (such as pivot tables) to group the
data and provide information on the total costs of registering each substance, the total volumes
produced across all MIs, etc.
Company Level
When the 88,600 rows of data are ordered and grouped by the identity of the MIs (using pivot
tables), for each MI, each row of data provides information on the costs of registering each of the 110t substances in the portfolio of that MI. This makes it possible to examine the cost implications at
29
The Monte Carlo simulation applies an normal inverse distribution with a mean of 8 and a standard
deviation of 1.5.
REACH 1- 10 tonnes Phase 2
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the level of each individual MI, either at the level of each individual substance in the portfolio of that
MI or, when totalled across all substances registered by that MI, the cost implications across all
substances in the portfolio. As the Monte Carlo simulation also records information on the size of
each enterprise, it is also possible to separate out and view these data by size of MI and, therein,
assess the relative impact on SMEs versus larger enterprises. This, in turn, provides enhanced
information for the assessment of less quantifiable business impacts such as on competition and
innovation.
5.1.2 Costs and Receptors
Business Impacts are considered in more detail in Section 6. This section restricts itself to analysis of
the raw data from the Monte Carlo simulation and using it to estimate the underlying costs.
At the most basic level, the economic costs of the options (and the baseline) comprise:

The cost of registering substances under REACH; and

Where the cost of registering certain substances is unsupportable on the grounds of
financial cost (and/or its properties render it unsuitable for continued use), the cost of
withdrawing those substances from the market.
Two major groups of operators will incur such costs: Manufacturers and Importers (MIs); and
Downstream Users (DUs). The types of cost incurred by each are most conveniently considered in
terms of:

MI direct costs of registration –the costs of registering substances will be incurred initially
by MIs registering those substances. A proportion of these costs will be absorbed by the MIs
themselves (representing the MI costs of registration) and a proportion will be passed down
the supply chain (to downstream users) as, for example, an increase in product price;

DU indirect costs of registration: linked to the above, DUs will incur an increase in costs that
is proportional to the cost of registration not absorbed by the MIs themselves;

MI costs of withdrawal: where a substance is not registered and is withdrawn from the
market MIs will lose any profit that would otherwise have been made in the absence of the
Regulation; and

DU costs of withdrawal: where a substance is not registered and is withdrawn from the
market by MIs, DUs will incur costs associated with the need to reformulate or otherwise
adjust their business to cope with the withdrawal. These costs would not be incurred in the
absence of the Regulation.
The general approach used for the calculation of all of these costs begins with consideration of the
raw data from the Monte Carlo simulation which provides information on the hypothetical cost of
registering all substances. This, in turn, provides information on which substances might be
withdrawn because registration is unsupportable financially. Once these are identified, it is possible
to divide the raw data from the Monte Carlo simulation into two: One data set capturing all of the
substances to be withdrawn from the market (under each option); and one data set capturing all of
the substances to be registered (under each option).
REACH 1- 10 tonnes Phase 2
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In this way, the analysis is divided into calculation of:


the predicted costs of registering substances that can be supported (to MIs and DUs); and
the costs of withdrawing those substances that cannot be supported (to MIs and DUs).
5.1.3 Hypothetical cost of registering all substances
As noted in Section 5.1, the first consideration has been the hypothetical cost of registering all
substances where this informs consideration of the extent to which substances are likely to be
withdrawn from the market owing to the cost of registration.
Aggregating the cost data produced by the Monte Carlo simulation across all substances and MIs,
Table 5.1 provides the total hypothetical costs of registering all substances and the average cost of
registration per substance and also per tonne across all substances. All costs are assumed to be
incurred over the four year period between 2015 and the registration deadline (2018) and are
reported as Present Values (PV) discounted at 4%. Costs per tonne of production are based on
production over the same four year period (and so the tonnage denominator reflects four years of
production of each substance by all MIs producing the substance).
Table 5.1: Hypothetical registration costs under the options (all values expressed as Present Value over 4
years at 4%)
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/Dis
III
Diffuse/Dis
III
Diffuse/Dis
persive
persive
persive
Use Trigger
Use Trigger
Use Trigger
in Annex III
in Annex III
in Annex III
Total costs across all
€ 493.8
€ 644.4
€ 896.9
€ 662.6
€ 929.0
€ 1,084.0
substances (€ millions)
Average hypothetical
cost of substance
€ 24,690
€ 32,220
€ 44,845
€ 33,130
€ 46,450
€ 54,200
registration per
substance (€)
Average hypothetical
cost of substance
€ 225
€ 303
€ 433
€ 312
€ 449
€ 530
registration per tonne
(€)
5.1.4 Substances withdrawn from the market
The average values provided in Table 5.1 suggest a cost of €225 per tonne on average under the
baseline and between €303 and €530 per tonne on average per substance across the options. The
averages, however, conceal considerable variation in the magnitude of costs between substances
and also between MIs. Here, registration costs vary significantly from one substance to another
where the magnitude of the total costs for a substance depends on a number of factors, the main
ones being:

The test information that must be submitted – which varies from one option to another;
REACH 1- 10 tonnes Phase 2
RPA & CSES | 51

The number of MIs registering a given substance – anything between one and 15. This does
not vary from one option to another but does govern both the extent to which information
costs can be shared between MIs and also the administration costs for registration (joint and
individual); and

The size of the enterprises registering the substance – which does not vary from one option
to another but does govern the fees and charges that apply considering the information
supplied as part of a registration.
Similarly, at the level of individual MIs, overall registration costs vary from one MI to another with
the magnitude of costs depending on:

The number of substances in a company’s portfolio – which affects the total costs of
registration across all substances registered;

The testing and information required for those substances – which varies from one option to
another;

The number of other MIs also registering those substances – which affects the extent to
which information costs can be shared with other MIs and also the administration costs for
registration of those substances.
Figure 5.1 provides a percentage frequency plot of the hypothetical cost of registration of all 20,000
substances expressed per tonne of production across all MIs. As can be seen from Figure 5.1,
hypothetical costs of registration can exceed values of €2,100 per tonne for some substances. In
fact, the axis has been adjusted for clarity and the highest value in the raw Monte Carlo simulation
data is around €3,800 per tonne (for two substances under the Annex VII++ option). More typically
the Monte Carlo data suggests that costs per substance are likely to be of a much lower magnitude.
The peaks observed at the lower end of the spectrum for all cases where Annex III criteria (or
aspects of) are retained are mostly associated with substances submitting physico-chemical data
alone but also some substances submitting full information where factors (including lower testing
triggered under the information options combined with a larger number of manufacturers and total
tonnage) act to reduce the cost per tonne to a similarly low level.
Identifying Substances Withdrawn from the Market
Regarding withdrawal owing to unsupportable costs of registration, clearly, the decision to withdraw
a substance depends on a number of factors of which the most important are likely to be the cost of
registration, the value of the product to each of the MIs and, hence, the ratio between both. In
reality, the relationship between the cost of the registration and the decision to withdraw the
substance is not straightforward and depends on multiple other factors. Of the known factors that
can be estimated in an analysis such as this, only the cost of registration is ‘known’ with some
degree of certainty. As such, in order to account for withdrawal at all within the analysis, one must
rely on a proxy for the point at which registration is likely to become unsustainable on cost grounds.
For this analysis, as indicated in Figure 5.1, a cut-off point of €750 per tonne has been used to
differentiate between substances to be withdrawn and substances to be registered under the
options (and the baseline).
REACH 1- 10 tonnes Phase 2
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Figure 5.1: Hypothetical cost of registration per substance per tonne (€s per tonne)
Hypothetical cost of registration per substance (€ per tonne)
50.0%
45.0%
40.0%
35.0%
30.0%
thisBaseline
25.0%
Annex VII No diffuse/dispersive use criterion
Annex VII No Annex III
20.0%
Annex VII+ No diffuse/dispersive use criterion
Annex VII+ No Annex III
15.0%
Annex VII++ No diffuse/dispersive use criterion
10.0%
5.0%
Cost Range
REACH 1- 10 tonnes Phase 2
RPA & CSES | 53
<= € 2175
<= € 2100
<= € 2025
<= € 1950
<= € 1875
<= € 1800
<= € 1725
<= € 1650
<= € 1575
<= € 1500
<= € 1425
<= € 1350
<= € 1275
<= € 1200
<= € 1125
<= € 1050
<= € 975
<= € 900
<= € 825
<= € 750
<= € 675
<= € 600
<= € 525
<= € 450
<= € 375
<= € 300
<= € 225
<= € 150
<= € 75
0.0%
<= € 0
Percent frequency
Substance is
withdrawn from
the market
Substance is
registered
Applying this rule to the raw data from the Monte Carlo simulation: where the cost of registration
exceeds €750 per tonne for a substance, that substance is assumed to be withdrawn from the
market by all MIs.
As the costs of registration are differ between options (and the baseline), under some options a
substance may exceed €750 per tonne (and be withdrawn) and, under others, it may not. This
means that different numbers of substances will be withdrawn under the options and the baseline.
This is illustrated in Table 5.2 which for each option (and the baseline) shows the number of
substances with hypothetical registration costs per tonne exceeding different intervals (including
€750 per tonne).
Table 5.2: Number of substances with hypothetical registration costs exceeding different values
Option
Hyothetical
Annex VII
Annex VII+
Annex VII++
cost of
No
No
No
registration (€
Annex VII
Annex VII+
Baseline
diffuse/disp
diffuse/disp
diffuse/disp
per per
No Annex III
No Annex III
ersive use
ersive use
ersive use
tonne)
criterion
criterion
criterion
€0
20,000
20,000
20,000
20,000
20,000
20,000
€ 75
15,183
16,640
18,812
16,716
19,421
17,167
€ 150
6,544
10,110
16,451
10,316
16,751
12,455
€ 225
5,358
8,371
13,582
8,600
13,991
11,703
€ 300
4,329
6,762
10,949
6,925
11,264
10,573
€ 375
3,408
5,351
8,475
5,626
8,923
9,522
€ 450
2,823
4,407
6,934
4,572
7,302
8,343
€ 525
2,138
3,322
5,138
3,569
5,522
7,293
€ 600
1,704
2,672
4,251
2,792
4,422
6,467
€ 675
1,482
2,330
3,615
2,416
3,803
5,691
€ 750
1,305
2,025
3,324
2,117
3,473
4,927
€ 900
598
946
1,473
1,110
1,709
3,896
€ 1,050
487
776
1,230
820
1,298
3,007
€ 1,275
322
514
784
557
870
1,955
€ 1,500
167
262
440
287
465
1,484
€ 1,800
161
254
421
257
428
1,024
€ 2,025
123
184
325
190
334
559
€ 2,100
70
101
2
146
144
489
€ 2,175
0
0
0
35
55
399
€ 2,250
0
0
0
12
3
364
€ 2,400
0
0
0
1
3
281
€ 2,550
0
0
0
1
2
230
€ 2,700
0
0
0
0
2
206
€ 3,000
0
0
0
0
0
159
€ 3,300
0
0
0
0
0
42
€ 3,600
0
0
0
0
0
2
€ 3,900
0
0
0
0
0
0
From Table 5.2 it can be see that, under the baseline, 1,305 substances (6.5%) in the Monte Carlo
data set have hypothetical registration costs exceeding €750 per tonne. This value of 6.5% is
comparable with the estimates for percentage of 1-10t substances withdrawn under the Regulation
REACH 1- 10 tonnes Phase 2
RPA & CSES | 54
at the time that it was being drawn up. This is why €750 per tonne has been selected as a cut-off
point to indicate withdrawal under the baseline and the options.
Applying the €750 per tonne cut-off point across all of the options (and the baseline) identifies the
following numbers of substances in the raw Monte Carlo data set where registration would not be
supported (and the substances would be withdrawn from the market):






Baseline: 1,305 substances withdrawn;
Annex VII No diffuse/dispersive use criterion: 2,025 substances withdrawn;
Annex VII No Annex III: 3,324 substances withdrawn;
Annex VII+ No diffuse/dispersive use criterion: 2,117 substances withdrawn;
Annex VII+ No Annex III: 3,473 substances withdrawn; and
Annex VII++ No diffuse/dispersive use criterion: 4,927 substances withdrawn.
In each case and for each option, substances that would be withdrawn from the market have been
identified and labelled in the Monte Carlo data set. This division of the Monte Carlo data between
substances registered and substances withdrawn has allowed separate analyses to be undertaken on
the cost and business impact of each.
5.2 Estimated cost of substance withdrawal
5.2.1 Attributes of Substances withdrawn from the Market
The division of the Monte Carlo data in this way permits separate analysis of substances with
hypothetical registration costs in excess of €750 per tonne. Analysis of the Monte Carlo simulation
data for each of the substances withdrawn under each of the options (and the baseline) provides the
breakdown in Table 5.3.
In the table, for each option (and the baseline) summary data are provided on the numbers of
substances, total volumes of production of these substances and also the factors that may cause
(hypothetical) registration costs to be higher than €750 per tonne.
In terms of the factors that cause costs to be higher, one of the most significant factors appears to
be the number of MIs which, in combination with costs of providing toxicological and
ecotoxicological information (including the possibility of further mutagenicity testing) and lower
tonnages produced, causes the cost of (hypothetical) registration to be elevated to levels that make
registration uneconomic. As can be seen from the table, for all but the Annex VII++ option, in excess
of 80% of the substances withdrawn are manufactured by 1 to 2 MIs (and more than 50% by only
one MI). The combination of high(er) registration costs and low numbers of MIs reduces
opportunities for cost sharing between SIEF members.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 55
Table 5.3: Attributes of substances withdrawn from the market under the different options
1,305
6.5%
Annex VII No
diffuse/dispersive
use criterion
2,025
10.1%
3,473
17.4%
Annex VII++ No
diffuse/dispersive
use criterion
4,927
24.6%
19,181
30,052
49,026
31,445
51,575
90,841
851
1,359
2,174
1,395
2,243
4,316
0
0
0
56
92
101
736
344
218
7
0
0
0
1,113
557
346
8
1
0
0
1,868
884
560
11
1
0
0
1,168
577
356
15
1
0
0
1,930
942
573
27
1
0
0
1,599
1,835
1,101
240
122
30
0
83%
82%
83%
82%
83%
70%
Baseline
Number of substances withdrawn
Percentage of substances withdrawn
Total tonnes of production withdrawn across all
withdrawn substances
Number that would have been subject to
further mutagenicity testing (true or false
positives in in vitro screening tests)
Number that would have be subject to PBT
Assessment
1
2
3
Number of MIs (would
4
be registrants)
5
6
7 or more
Percentage manufactured by only 1 or 2 MIs
(would be registrants)
Option
Annex VII+ No
Annex VII No
diffuse/dispersiv
Annex III
e use criterion
3,324
2,117
16.6%
10.6%
REACH 1- 10 tonnes Phase 2
RPA & CSES | 56
Annex VII+ No
Annex III
5.2.2 Cost of withdrawal
The cost of substance withdrawal is broadly associated with both the income foregone from
manufacture or import (for MIs30) and the need to reformulate products (incurred by DUs). In both
cases, the scale of costs is related to the commercial value of the product being withdrawn. In the
absence of any better indication, the magnitude of the (hypothetical) cost of registration that
triggers withdrawal of that substance under the options has been used as an indicative proxy for the
‘commercial value’ of a withdrawn substance. The underlying assumption here is that, for all of the
substances withdrawn from the market on the grounds of cost, the hypothetical registration cost
that triggers that withdrawal is at the ‘break-even’ point.
Owing to the fact that there is overlap between substances withdrawn under the baseline and each
of the options, the ‘break even’ point for a substance is taken as being the lowest hypothetical
registration cost that triggers that withdrawal. Thus, for example, for substances withdrawn under
the baseline and the other options the ‘break-even’ point is equal to the hypothetical cost of
registration for each substance under the baseline.
In terms of lost annual income from withdrawal of substances (for MIs), there is no data from which
to extrapolate. However, for the purposes of this analysis, on the basis of the consultants expert
judgement, lost annual income has been taken as being equal to 10% of the indicative ‘commercial
value’ given by the hypothetical registration cost for each substance per year. Costs are incurred for
five years following the 2018 registration deadline (and the totals have been discounted at 4% to
provide Present Values).
In terms of the cost of reformulation (for DUs), logically this is unlikely to be higher than the
(hypothetical) costs of registration. This is because if it were more expensive to reformulate than to
register (or reformulation was not possible), DUs would be keen to sponsor (or part sponsor)
registration of the substance. Thus the maximum costs of reformulation (for DUs) are equal to the
hypothetical costs of registration for withdrawn substances and this maximum has been applied to
derive cost estimates.
Table 5.4 provides the resulting total costs of withdrawal to MIs and to DUs as a whole under the
baseline and the options. The impacts of these costs on different sizes of businesses are considered
in Section 6.
30
Although an importer may find a substitute with lower registration requirements, hence no income would
be foregone.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 57
Table 5.4: Costs of substance withdrawal under the options
Baseline
Annex VII - Annex VII No
No Annex
Diffuse/
III
Dispersive
Use
Criterion in
Annex III
Total costs to MIs
(income foregone - €
€ 31.5
€ 49.4
€ 80.5
millions)
Total costs to DUs
(maximum
€ 81.0
€ 126.9
€ 203.5
reformulation cost €millions)
Annex VII+
- No
Diffuse/
Dispersive
Use
Criterion in
Annex III
Annex VII+
- No Annex
III
Annex
VII++ - No
Diffuse/
Dispersive
Use
Criterion in
Annex III
€ 51.2
€ 83.8
€ 152.3
€ 134.7
€ 217.0
€ 436.6
5.3 Estimated costs of registration
The overall costs of registration (to MIs and DUs combined) under the options can be re-calculated
by separating out the withdrawn substances from the full Monte Carlo dataset for each of the
options and the baseline. As with the withdrawn substances considered in Section 5.2, this allows
the cost and other data produced by the Monte Carlo simulation to be analysed separately, dividing
the data into withdrawn versus registered substances. The resulting overall costs of substance
registration (accounting for substance withdrawal) given by the Monte Carlo simulation data are
provided in Table 5.5 (which can be compared directly with Table 5.1 showing costs before
withdrawal – i.e. across all 20,000 substances).
Table 5.5: Registration costs under the options (all values expressed as Present Value over 4 years at 4%)
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
Total costs across all
€ 412.8
€ 517.5
€ 693.4
€ 527.9
€ 712.0
€ 647.4
substances (€ millions)
Total costs for
substances submitting
full information under
€ 276.4
€ 276.4
€ 270.3
€ 283.6
€ 278.7
€ 358.8
the baseline (€
millions)
Total costs for those
substances submitting
physchem only
€ 136.4
€ 241.1
€ 423.1
€ 244.3
€ 433.2
€ 288.6
information under the
baseline (€ millions)
Average cost of
substance registration
€ 163
€ 212
€ 302
€ 216
€ 311
€ 261
per tonne (€)
REACH 1- 10 tonnes Phase 2
RPA & CSES | 58
As with the hypothetical costs discussed in Section 5.2.1, the average values conceal variation in the
cost of registering different substances. Figure 5.2 provides a percentage frequency plot of the cost
of registration costs of all substances registered (expressed in € per tonne). This figure can be
compared directly with Figure 5.1 (which provides costs before withdrawal has been accounted for).
For the analysis of cost and impact, in the absence of information to the contrary, it is assumed that
MIs pass half of the registration costs on to Downstream Users (DUs). As such, half of the costs in
Table 5.5 will be absorbed by MIs and half will be passed on to DUs. The impact of these costs on
MIs and DUs is considered in Section 6 on business impacts.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 59
Figure 5.2: Total cost of registration (to MIs and DUs) per substance per tonne (€s per tonne)
Cost of registration per substance (€ per tonne)
60.0%
50.0%
Baseline
30.0%
Annex VII No diffuse/dispersive use criterion
Annex VII No Annex III
Annex VII+ No diffuse/dispersive use criterion
20.0%
Annex VII+ No Annex III
Annex VII++ No diffuse/dispersive use criterion
10.0%
Cost Range
REACH 1- 10 tonnes Phase 2
RPA & CSES | 60
<= € 750
<= € 700
<= € 650
<= € 600
<= € 550
<= € 500
<= € 450
<= € 400
<= € 350
<= € 300
<= € 250
<= € 200
<= € 150
<= € 100
<= € 50
0.0%
<= € 0
Percent frequency
40.0%
5.4 Total costs of the Options
The total costs to MIs, DUs and overall are summarised in Table 5.6 for the baseline and each option.
Table 5.6: Summary and total costs of the options (all values expressed as Present Values discounted at
4%)
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
Costs of Withdrawal
MI costs of withdrawal
(income foregone) (€
€ 31.5
€ 49.4
€ 80.5
€ 51.2
€ 83.8
€ 152.3
millions)
DU costs of withdrawal
(maximum
€ 81.0
€ 126.9
€ 203.5
€ 134.7
€ 217.0
€ 436.6
reformulation cost) (€
millions)
Registration costs
MI costs of registration
€ 206.4
€ 258.7
€ 346.7
€ 263.9
€ 356.0
€ 323.7
(€ millions)
DU costs of registration
€ 206.4
€ 258.7
€ 346.7
€ 263.9
€ 356.0
€ 323.7
(€ millions)
Total Costs
Total Costs to MIs (€
€ 237.9
€ 308.1
€ 427.2
€ 315.1
€ 439.8
€ 476.0
millions)
Total costs to DUs (€
€ 287.4
€ 385.7
€ 550.2
€ 398.7
€ 573.0
€ 760.3
millions)
Total costs (€ millions)
€ 525.2
€ 693.8
€ 977.4
€ 713.8
€ 1,012.8
€ 1,236.3
Change in total PV costs between options
Working from the baseline and through the options the following changes in total PV costs are
observed:

Baseline (Current Annex III and Annex VII information): total costs under the baseline are
around €525 million;

Removal of the diffuse/dispersive use criterion in Annex III: has the effect of increasing the
number of substances required to generate and submit full tox and ecotox information.
When combined with options for changing the information required in Annex VII, this has
the following effects:
o
Annex VII (No Diffuse Dispersive Use Criterion in Annex III): Where there are no
changes in the information required in Annex VII, the cost increases by €168.6
million from the baseline to €693.8 million overall (an increase of 32%);
REACH 1- 10 tonnes Phase 2
RPA & CSES | 61

o
Annex VII+ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are slight
changes to the information required (Annex VII+), the effect is to further increase
the costs by an additional €20 million (relative to no change in the information
required in Annex VII) to €713.8 million. The net effect is that costs increase to
€188.6 million above the baseline (an increase of 36% - 4% higher than the no
change in Annex VII option);
o
Annex VII++ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are
more significant changes to the information required (Annex VII++), the effect is to
further increase the costs by an additional €542.8 million (relative to no change in
the information required in Annex VII). The net effect is that costs increase to
€738.1 million above the baseline (an increase of 140% - 108% higher than the no
change in Annex VII option);
Removal of Annex III: This has the effect of requiring full tox and ecotox information to be
submitted for all substances (so significantly increasing the number of substances submitting
full information). When combined with options for changing the information required in
Annex VII, this has the following effects:
o
Annex VII (No Annex III): Where there are no changes in the information required in
Annex VII, the cost increases by €452.2 million from the baseline to €977.4 million
overall (an increase of 86%); and
o
Annex VII+ (No Annex III): Where there are slight changes to the information
required (Annex VII+), the effect is to further increase the costs by an additional
€35.4 million (relative to no change in the information required in Annex VII) to
€1,012.8 million. The net effect is that costs increase to €487.6 million above the
baseline (an increase of 93% - 7% higher than the no change in Annex VII option).
REACH 1- 10 tonnes Phase 2
RPA & CSES | 62
6 Business impacts
6.1 Overview
Section 5 has provided the estimates of the overall costs to manufacturers and importers (MIs) and
downstream users (DUs) that would be incurred under the baseline and the options. Drawing on the
dataset produced by the Monte Carlo simulation described in Section 4, this section seeks to explore
the impacts of these costs in more detail and, where outputs from the Monte Carlo simulation make
it possible, at the level of micro, small, medium and large enterprises. This, in turn, informs wider
consideration of less quantifiable impacts such as those in innovation and competitiveness.
6.2 Impact of substance withdrawal on manufacturers and
importers (MIs)
The overall costs of substance withdrawal to MIs have been described in Section 5.3 where these
focus on the income foregone by MIs with the withdrawal of substances from the market. As can be
seen from the summary Table 6.1, MI substance withdrawal makes up between 13 and 32% of the
total cost of the baseline and options to MIs (and between 6% and 12% overall).
Table 6.1: Summary and total costs of the options (all values expressed as Present Values discounted at
4%)
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
MI costs of withdrawal
(income foregone)
€ 31.5
€ 49.4
€ 80.5
€ 51.2
€ 83.8
€ 152.3
(€millions)
Total Costs to MIs
€ 237.9
€ 308.1
€ 427.2
€ 315.1
€ 439.8
€ 476.0
(€millions)
Total costs (MIs and
DUs - € millions)
€ 525.2
€ 693.8
€ 977.4
€ 713.8
€ 1,012.8
€ 1,236.3
MI costs of withdrawal
as % of total cost to
13%
16%
19%
16%
19%
32%
MIs
MI costs of withdrawal
as % of total costs (MIs
6%
7%
8%
7%
8%
12%
and DUs)
The sub-sections below explore these costs further, providing information from the modelled
simulation on the impacts of withdrawal on different sizes of enterprise and overall providing
information on the number of MIs impacted by withdrawal and the associated company level
reductions in tonnes produced and annual income foregone owing to withdrawals.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 63
6.2.1 Number of MIs impacted by withdrawal
As noted in Section 5.4, a division has been made in the Monte Carlo dataset between substances to
be registered and substances to be withdrawn under each of the options and the baseline. As the
Monte Carlo simulation generates and records information on the manufacturers, size of those
manufacturers, volumes produced by each manufacturer as well as other information (such as what
the cost of registration would have been), these data can be analysed to produce a profile of the
withdrawn substances in terms of the same attributes. Table 6.2 summarises the data from the
Monte Carlo simulation in terms of the number of MI companies withdrawing one or more
substances from their portfolios and the same numbers expressed as a percentage of the total
number of companies in the appropriate size category.
Variation between companies of different sizes
In terms of variations in the scale of impacts between companies of different sizes (and the potential
for disproportionate impacts on smaller companies), the larger the size of enterprise the more likely
that one or more substances will be withdrawn from the market. This applies under the baseline
and all of the options for changing information requirements and is simply as a result of the fact
that, on average, the larger the size of enterprise, the larger the portfolio in terms of numbers of 110t substances.
Table 6.2: Number of MI Companies impacted by withdrawal
Baseline
Annex VII - Annex VII - Annex VII+
No
No Annex
- No
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Use
Use
Criterion in
Criterion in
Annex III
Annex III
Number of companies
Micro companies
946
1,396
2,183
1,431
Small Companies
350
542
838
565
Medium Companies
278
403
574
423
Large Companies
258
330
357
336
Total
1,832
2,671
3,952
2,755
Percentage of total companies in size category
Micro companies
11.1%
16.4%
25.6%
16.8%
Small Companies
14.0%
21.7%
33.5%
22.6%
Medium Companies
25.3%
36.6%
52.2%
38.5%
Large Companies
64.5%
82.5%
89.3%
84.0%
Total
14.6%
21.3%
31.6%
22.0%
Annex VII+
- No Annex
III
Annex
VII++ - No
Diffuse/
Dispersive
Use
Criterion in
Annex III
2,250
872
607
364
4,093
3,521
1,307
824
400
6,052
26.4%
34.9%
55.2%
91.0%
32.7%
41.4%
52.3%
74.9%
100.0%
48.4%
Variation in withdrawals between options
A consistent trend can be observed working across companies of all sizes from the baseline and
through the options:

Baseline (Current Annex III and Annex VII information): Under the baseline around 14.6%
of companies will withdraw one or more substances;
REACH 1- 10 tonnes Phase 2
RPA & CSES | 64


Removal of the diffuse/dispersive use criterion in Annex III: has the effect of increasing the
number of substances required to generate and submit full tox and ecotox information.
When combined with options for changing the information required in Annex VII, this has
the following effects:
o
Annex VII (No Diffuse Dispersive Use Criterion in Annex III): Where there are no
changes in the information required in Annex VII, the number of companies
withdrawing substances increases by 6.7% from the baseline to 21.3% overall;
o
Annex VII+ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are slight
changes to the information required (Annex VII+), the effect is to further increase
the number of companies withdrawing substances by an additional 0.7% (relative to
no change in the information required in Annex VII). The net effect is that the
number of companies withdrawing substances increases to 7.4% above the baseline
(with 22% of companies withdrawing one or more substances overall);
o
Annex VII++ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are
more significant changes to the information required (Annex VII++), the effect is to
further increase the number of companies withdrawing substances by an additional
27.1% (relative to no change in the information required in Annex VII). The net
effect is that the number of companies withdrawing substances increases to 33.8%
above the baseline (with 48.4% of companies withdrawing one or more substances
overall);
Removal of Annex III: This has the effect of requiring full tox and ecotox information to be
submitted for all substances (so significantly increasing the number of substances submitting
full information). When combined with options for changing the information required in
Annex VII, this has the following effects:
o
Annex VII (No Annex III): Where there are no changes in the information required in
Annex VII, the number of companies withdrawing substances increases by 17% from
the baseline to 31.6% overall;
o
Annex VII+ (No Annex III): Where there are slight changes to the information
required (Annex VII+), the effect is to further increase the number of companies
withdrawing substances by an additional 1.1% (relative to no change in the
information required in Annex VII). The net effect is that the number of companies
withdrawing substances increases to 18.1% above the baseline (with 32.7% of
companies withdrawing one or more substances overall).
6.2.2 Levels of production withdrawn by MIs
Clearly, within the population of companies withdrawing substances (given in Table 6.2), the
withdrawal of substances will affect some companies more severely than others with the most
extreme case being that withdrawal of substances leads to withdrawal of all (100%) of existing
production.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 65
Number of companies where all of 1-10t substance production withdrawn
Table 6.3 provides data from the Monte Carlo simulation profiling the number of companies
withdrawing all of the 1-10t substances in their portfolios. Thus, for these companies, 100% of
existing production is discontinued after registration in 2018. Data are provided on numbers of
companies by size, as a percentage of all companies and as a percentage of companies withdrawing
one or more substances.
The data suggest that complete withdrawal of the entire portfolio of 1-10t substances is a rare
outcome regardless of the option. Though rare, it is most likely to occur in companies with smaller
portfolios comprised of only a (very) few substances. As such, with smaller portfolios on average, the
smaller sized SMEs (micro and small) are more likely to withdraw entire 1-10t substance portfolios
but even here this is a very rare event.
Table 6.3: Number of companies where all of production withdrawn
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
No
No Annex
- No
- No Annex
Diffuse/
III
Diffuse/
III
Dispersive
Dispersive
Use
Use
Criterion in
Criterion in
Annex III
Annex III
Number of companies
Micro companies
5
8
19
8
21
Small Companies
1
2
3
2
3
Medium Companies
0
0
0
0
0
Large Companies
0
0
0
0
0
Total
6
10
22
10
24
As a percentage of all companies
Micro companies
0.06%
0.09%
0.22%
0.09%
0.25%
Small Companies
0.04%
0.08%
0.12%
0.08%
0.12%
Medium Companies
Large Companies
Total
0.05%
0.08%
0.18%
0.08%
0.19%
As a percentage of companies withdrawing one or more substances
Micro companies
0.5%
0.6%
0.9%
0.6%
0.9%
Small Companies
0.3%
0.4%
0.4%
0.4%
0.3%
Medium Companies
Large Companies
Total
0.3%
0.4%
0.6%
0.4%
0.6%
Annex
VII++ - No
Diffuse/
Dispersive
Use
Criterion in
Annex III
43
4
0
0
47
0.50%
0.16%
0.38%
1.2%
0.3%
0.8%
Number of companies experiencing different levels of reduction in annual tonnage production
Whilst complete withdrawal of entire portfolios of 1-10t substances is a rare outcome for
companies, clearly some reduction production is inevitable where a company withdraws one or
more substances.
Tables 6.4 and 6.5 provide information from the Monte Carlo simulation on the number of
companies experiencing different levels of production loss (measured in tonnes per year) of 1-10t
substances. Table 6.5 provides this as percentage of companies relative to the total number of
REACH 1- 10 tonnes Phase 2
RPA & CSES | 66
companies’ currently manufacturing/importing 1-10t substances and Table 6.5 provides the same
data as a percentage of the companies withdrawing substances.
Table 6.4: Number of companies experiencing different levels of reduction in annual tonnage production
as a percentage of the total number of companies
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
Percentage of companies where >80% of production tonnage withdrawn but <100%
Micro companies
0.02%
Small Companies
Medium Companies
Large Companies
Total
Percentage of companies where >60% of production tonnage withdrawn but <100%
Micro companies
0.1%
0.3%
0.6%
0.3%
0.6%
1.1%
Small Companies
0.1%
0.0%
0.1%
0.6%
Medium Companies
0.1%
Large Companies
Total
0.1%
0.2%
0.4%
0.2%
0.4%
0.9%
Percentage of companies where >40% of production tonnage withdrawn but <60%
Micro companies
0.6%
1.0%
2.1%
1.0%
2.2%
4.2%
Small Companies
0.4%
0.7%
1.3%
0.7%
1.4%
3.1%
Medium Companies
0.1%
0.4%
0.1%
0.4%
1.0%
Large Companies
Total
0.5%
0.8%
1.7%
0.8%
1.8%
3.6%
Percentage of companies where >30% of production tonnage withdrawn but <40%
Micro companies
1.2%
2.0%
3.5%
2.1%
3.7%
7.0%
Small Companies
0.8%
1.2%
2.7%
1.2%
2.8%
5.2%
Medium Companies
0.2%
0.8%
1.3%
0.8%
1.3%
5.2%
Large Companies
1.5%
Total
1.0%
1.7%
3.1%
1.7%
3.2%
6.3%
REACH 1- 10 tonnes Phase 2
RPA & CSES | 67
Table 6.5: Number of companies experiencing different levels of reduction in annual tonnage production
as a percentage of the number of companies withdrawing one or more substances
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
Percentage of companies where >80% of production tonnage withdrawn but <100%
Micro companies
0.06%
Small Companies
Medium Companies
Large Companies
Total
Percentage of companies where >60% of production tonnage withdrawn but <100%
Micro companies
1.0%
1.6%
2.2%
1.6%
2.2%
2.7%
Small Companies
0.2%
0.4%
0.2%
0.3%
1.1%
Medium Companies
0.1%
Large Companies
Total
0.5%
0.9%
1.3%
0.9%
1.3%
1.8%
Percentage of companies where >40% of production tonnage withdrawn but <60%
Micro companies
5.7%
6.1%
8.1%
6.1%
8.5%
10.1%
Small Companies
2.6%
3.1%
3.8%
3.0%
4.0%
5.9%
Medium Companies
0.2%
0.7%
0.2%
0.7%
1.3%
Large Companies
Total
3.4%
3.9%
5.4%
3.8%
5.6%
7.4%
Percentage of companies where >30% of production tonnage withdrawn but <40%
Micro companies
10.7%
12.2%
13.8%
12.4%
14.0%
17.0%
Small Companies
5.4%
5.4%
8.0%
5.3%
8.0%
9.9%
Medium Companies
0.7%
2.2%
2.4%
2.1%
2.3%
6.9%
Large Companies
1.5%
Total
6.7%
7.8%
9.7%
7.9%
9.7%
13.1%
The data in Table 6.5 suggest the following:




very few companies (0.5% to 1.8% of companies withdrawing depending on the option) are
affected by very significant changes in overall tonnages produced (>60% of 1-10t substance
production tonnage withdrawn);
few companies (3.4% to 7.4% of companies withdrawing depending on the option) are
affected by significant changes in overall tonnages produced (40-60% of 1-10t substance
production tonnage withdrawn); and
few companies (6.7% to 13.1% of companies withdrawing depending on the option) are
affected by moderately significant changes in overall tonnages produced (30-40% of 1-10t
substance production tonnage withdrawn);
for the vast majority of companies withdrawing one or more substances, less than 30% of
the current total tonnes of 1-10t substances produced would be withdrawn.
Summarising data from the Monte Carlo simulation on the withdrawn substances, Table 6.6 provides
the average percentage of annual production withdrawn by companies that withdraw one or more
REACH 1- 10 tonnes Phase 2
RPA & CSES | 68
substances. The numbers of companies (expressed as numbers and percentage of the total number
of companies) from Table 6.2 are also provided as context. Thus, for example, under the baseline
946 micro companies (11.1% of the total) would withdraw one or more substances where this would
represent 23% of the total annual current production of those companies.
Whilst the data in Table 6.2 identified that the larger the size of enterprise the more likely that one
or more substances will be withdrawn from the market (because on average, the larger the size of
enterprise, the larger the portfolio in terms of numbers of 1-10t substances), the data in Table 6.5
suggest that the impact on these larger companies is less than the smaller ones in terms of the
percentage of production reduced. Clearly, the reason for the variation is the same, smaller
companies have smaller portfolios of 1-10t substances (on average) and, hence, withdrawal of one
or more substances from these (smaller) portfolios will result in a greater proportion of annual
production withdrawn compared with larger companies (with generally larger portfolios).
Table 6.6: Average percentage of annual production withdrawn by affected companies
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
Total number of companies in size category withdrawing one or more substances
Micro companies
946
1,396
2,183
1,431
2,250
3,521
Small Companies
350
542
838
565
872
1,307
Medium Companies
278
403
574
423
607
824
Large Companies
258
330
357
336
364
400
Total
1,832
2,671
3,952
2,755
4,093
6,052
Percentage of total companies in size category withdrawing one or more substances
Micro companies
11.1%
16.4%
25.6%
16.8%
26.4%
41.4%
Small Companies
14.0%
21.7%
33.5%
22.6%
34.9%
52.3%
Medium Companies
25.3%
36.6%
52.2%
38.5%
55.2%
74.9%
Large Companies
64.5%
82.5%
89.3%
84.0%
91.0%
100.0%
Total
14.6%
21.3%
31.6%
22.0%
32.7%
48.4%
Average percentage of annual production tonnage withdrawn by affected companies
Micro companies
23%
24%
25%
24%
26%
27%
Small Companies
17%
18%
20%
18%
20%
22%
Medium Companies
10%
12%
13%
12%
13%
16%
Large Companies
4%
5%
7%
6%
8%
15%
Total
17%
18%
21%
19%
21%
24%
6.2.3 Annual Income foregone owing to withdrawal - MIs
In terms of the financial impact of withdrawal on these companies, Table 6.7 provides the total
annual income foregone by companies of different sizes and the average annual income foregone
per company by size. The numbers of companies (expressed as numbers and percentage of the total
number of companies) from Table 6.2 are also provided as context. Thus, for example, under the
baseline 946 micro companies (11.1% of the total) would withdraw one or more substances where
this would represent an annual income foregone of €3,800 on average per company (and €3.63
million across all 946 micro companies).
REACH 1- 10 tonnes Phase 2
RPA & CSES | 69
Variation between companies of different sizes
In terms of variations in the scale of impacts between companies of different sizes (and the potential
for disproportionate impacts on smaller companies), whilst the number of companies affected by
withdrawal increases with the higher cost options relative to the baseline, the average annual
income forgone per company affected changes very little for the micro, small and medium
enterprises. Annual income foregone per company is of similar magnitude for these sizes of
company but tends to be lower the smaller the company.
In contrast, because their portfolios are bigger (and thus their exposure to withdrawal is larger) the
larger companies generally forgo a larger income per company by withdrawal. There is also more
significant variation between options in terms of the income foregone, with the higher option
(Annex VII++) resulting in a much larger change in annual income foregone compared with the
smaller companies. Against this must be set the much larger total incomes from the more extensive
portfolios of 1-10t substances produced by larger enterprises.
Table 6.7: Annual Income foregone owing to withdrawal
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
Total number of companies in size category withdrawing one or more substances
Micro companies
946
1,396
2,183
1,431
2,250
3,521
Small Companies
350
542
838
565
872
1,307
Medium Companies
278
403
574
423
607
824
Large Companies
258
330
357
336
364
400
Total
1,832
2,671
3,952
2,755
4,093
6,052
Percentage of total companies in size category withdrawing one or more substances
Micro companies
11.1%
16.4%
25.6%
16.8%
26.4%
41.4%
Small Companies
14.0%
21.7%
33.5%
22.6%
34.9%
52.3%
Medium Companies
25.3%
36.6%
52.2%
38.5%
55.2%
74.9%
Large Companies
64.5%
82.5%
89.3%
84.0%
91.0%
100.0%
Total
14.6%
21.3%
31.6%
22.0%
32.7%
48.4%
Total annual income foregone (€ million)
Micro companies
€ 3.63
€ 5.52
€ 9.23
€ 5.64
€ 9.50
€ 16.22
Small Companies
€ 1.40
€ 2.23
€ 3.80
€ 2.29
€ 3.92
€ 6.63
Medium Companies
€ 1.21
€ 1.94
€ 3.14
€ 2.02
€ 3.29
€ 5.61
Large Companies
€ 1.71
€ 2.78
€ 4.18
€ 2.97
€ 4.47
€ 10.02
Total
€ 7.95
€ 12.47
€ 20.35
€ 12.93
€ 21.18
€ 38.48
Average annual income foregone per company (€ thousand)
Micro companies
€ 3.8
€ 4.0
€ 4.2
€ 3.9
€ 4.2
€ 4.6
Small Companies
€ 4.0
€ 4.1
€ 4.5
€ 4.1
€ 4.5
€ 5.1
Medium Companies
€ 4.4
€ 4.8
€ 5.5
€ 4.8
€ 5.4
€ 6.8
Large Companies
€ 6.6
€ 8.4
€ 11.7
€ 8.9
€ 12.3
€ 25.0
Overall
€ 4.3
€ 4.7
€ 5.1
€ 4.7
€ 5.2
€ 6.4
REACH 1- 10 tonnes Phase 2
RPA & CSES | 70
6.2.4 Impacts of withdrawal on innovation and competition - MIs
Substance withdrawal can affect innovation and competitiveness in various ways. Factors that will
influence this include: numbers of enterprises affected, enterprise size, levels of production affected
or income foregone. In the following paragraphs the nature of the effects are outlined then each
option is discussed.
As regards numbers of enterprises affected, if a substance is only produced or imported by a handful
of enterprises, the overall effects should be less, depending on the nature of the products it is used
for. If it is a critically important product it would probably spur innovation or substitution. There
could very probably also be increased competition as a result. If it is not used for a very useful and
economically viable product, the product may just be withdrawn. If the substance withdrawal
affects many firms, if this is used for a useful product for which demand remains strong enterprises
would seek to re-formulate or substitute, but if the product(s) in question is near the end of its life
cycle it may just hasten its withdrawal from the market. In instances where other companies supply
competing products that use substances that are not withdrawn, they will be at a competitive
advantage until such time as alternatives are adopted or developed.
The effect on innovation and competition of the number of companies impacted is further felt
through the level of production withdrawn, which, in turn has an effect on income foregone,
profitability, and viability of the enterprise. If significant shares of production and/ or turnover are
lost, this could lead to either attempts to find new sources of revenue, through for example
innovation, or to withdrawal from the industry, which means that those remaining are left in a
stronger competitive position. Firm size is also relevant here as smaller firms tend to be more
dependent on individual products (and experience more challenges in innovation), whereas larger
firms have more products, resources and resilience. From this point of view, more withdrawals will
tend to increase the share of larger firms in the industry.
Given these general comments, the implications of the specific options are discussed below.
Change/difference between options
Working from the baseline and through the options the following changes are anticipated:

Baseline (Current Annex III and Annex VII information): Overall some 14.6% of MIs could be
affected by withdrawals. This is a lower share than any of the options, which suggests lesser
effects on both innovation and competitiveness than in the case of those options. There are
few instances of all 1-10t substances being withdrawn, although this is more likely in smaller
than in larger firms. Having said that, 1 out of 6 of the micro firms that withdraw one or
more substances (14.6%) are expected to experience a tonnage loss of between 30-60%,
which is significant for a firm employing 1-9 employees, and could threaten its viability and
competitive position. The same is true for 1 out of 12 small firms with 1 or more
withdrawals. There is therefore likely to be some consolidation at this end of the market,
particularly as micro and small firms tend not to be as innovative (high value added) as
larger firms, although there is certainly likely to be a good deal of innovative activity as these
firms attempt to replace lost production and revenue.

Removal of the diffuse/dispersive use criterion in Annex III: has the effect of increasing the
number of substances required to generate and submit full tox and ecotox information.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 71
When combined with options for changing the information required in Annex VII, this has
the following effects:
o
Annex VII (No Diffuse Dispersive Use Criterion in Annex III): There is an increase of
close to 50% in companies affected, particularly for micro, small and medium
enterprises. However, there is still very low share of MIs that withdraw all 1-10t
production. Some 3.3% of micro MIs experience reductions in annual tonnage
production of between 30-60%. (19.9% of those experiencing a withdrawal). This is
again quite significant, and will lead to consolidation in the sector. Pressure from
customers may also stimulate innovative activity (substitution, reformulation, new
product development).
However, pressure on competition and innovation will probably be present more at
the smaller firm end of the market (while those firms, as SMEs, face more challenges
in this respect) as they try to deal with lost business, because the effects on large
companies is not as significant. Customer pressure may also drive additional
innovative activity in the larger firms.
o
Annex VII+ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are
slight changes to the information required (Annex VII+), the numbers of firms
affected, and impacts on levels of production and income are not materially
different to those of the no change in Annex VII option). The effects on competition
and innovation, accordingly, do not differ materially either.
o
Annex VII++ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are
more significant changes to the information required (Annex VII++), substantially
more companies are affected than in the Annex VII+ option. While the total number
of firms affected increases by a factor of 2.2, the number of micro firms affected
increases by 2.5 times (3.7 times more compared to the base line). The number of
companies where all 1-10t substances are withdrawn also increases, but this is still
quite a small percentage overall.
From a competitive point of view the reduced revenue in that segment of the
market will have a negative effect on the competitiveness of the firms affected,
especially at the smaller end of the market, and will probably lead to consolidation
among such firms and at the extreme to closures, depending on how important that
revenue is in terms of profitability. The need to find replacement revenue will also
encourage activity, whether to develop new products or to use existing products for
new uses. However, such activity is costly and micro and smaller firms in particular
may be constrained in this respect.
The net effect is that the negative effects on competitiveness and the positive
effects on innovation will probably both be greater compared with the no change in
Annex VII option.

Removal of Annex III: This has the effect of requiring full tox and ecotox information to be
submitted for all substances (so significantly increasing the number of substances submitting
full information). When combined with options for changing the information required in
Annex VII, this has the following effects:
REACH 1- 10 tonnes Phase 2
RPA & CSES | 72
o
Annex VII (No Annex III): Where there are no changes in the information required in
Annex VII, the effect is to increase the number of companies affected by a factor of
2.2 compared to the baseline and 46% compared to the Annex VII (no diffuse/
dispersive use criterion in Annex III). There is a similar shift in the number of
enterprises withdrawing their full 1-10tonne portfolios. The percentages of tonnage
withdrawn is higher, but not substantially higher, than in the case of Annex VII (no
diffuse/ dispersive use criterion in Annex III).
The effects of these changes will be to reduce the competitiveness of the companies
concerned, and again, this will probably lead to consolidation and market exit,
particularly at the smaller end of the market, depending on the extent to which
replacement income can be obtained. This should also act as a driver for innovation,
although as mentioned already, there are more constraints for smaller than larger
firms in this respect.
o
Annex VII+ (No Annex III): Where there are slight changes to the information
required (Annex VII+), the effects are not materially different relative to no change
in the information required in Annex VII.
6.3 Impact of substance withdrawal on downstream users (DUs)
6.3.1 Costs and impacts
The overall costs of substance withdrawal to DUs have been described in Section 5.3 where these
focus on the costs of reformulation to DUs after the withdrawal of substances from the market by
MIs. As can be seen from the summary Table 6.8, DU costs of substance withdrawal (maximum
costs of reformulation) makes up between 28% and 57% of the total cost of the baseline and options
to DUs (and between 15% and 35% overall).
Table 6.8: Summary and total costs of the options (all values expressed as Present Values discounted at
4%)
Baseline Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
Costs of Withdrawal
DU costs of withdrawal
(maximum
€ 81.0
€ 126.9
€ 203.5
€ 134.7
€ 217.0
€ 436.6
reformulation cost) (€
millions)
Total costs to DUs (€
€ 287.4
€ 385.7
€ 550.2
€ 398.7
€ 573.0
€ 760.3
millions)
Total costs (€ millions)
€ 525.2
€ 693.8
€ 977.4
€ 713.8
€ 1,012.8
€ 1,236.3
DU costs of withdrawal
28%
33%
37%
34%
38%
57%
as % of total cost to MIs
DU costs of withdrawal
as % of total costs (MIs
15%
18%
21%
19%
21%
35%
and DUs)
REACH 1- 10 tonnes Phase 2
RPA & CSES | 73
In terms of the impacts on individual downstream users, little is known about the numbers of
downstream users other than, despite the low tonnages involved, there may be several on average,
each using low volumes of the substances.
An estimate has been made on the cost of each option to individual downstream users by assuming
five downstream users per tonne of each substance. This results in the average cost per
downstream user provided in Table 6.9. As can be seen from Table 6.9, average costs per DU are
fairly similar across the options ranging between €827 and €963 per substance per DU under the
options and €850 under the baseline. The more significant factor governing the costs of the options
and the baseline is the number of substances withdrawn (and hence number of products that will
need to be re-formulated). As there may be more than one withdrawn substance in each DU
product for re-formulation, however, it cannot be assumed that each substance withdrawn equals
one product reformulated. I.e. there will be some overlap but the extent of this overlap is not
known.
Table 6.9: Reformulation costs to Downstream Users
Baseline
Annex VII - Annex VII No
No Annex
Diffuse/
III
Dispersive
Use
Criterion in
Annex III
Total tonnes of
19,181
30,052
49,026
production withdrawn
Total number of
substances withdrawn
1,305
2,025
3,324
Average production
per substance (tonnes
14.7
14.8
14.7
per year)
Maximum total cost of
re-formulation - (€
€ 81.0
€ 126.9
€ 203.5
millions)
Average maximum
total cost of re€ 62,054
€ 62,681
€ 61,222
formulation per
substance (€s)
Average number of
downstream users per
73
74
74
substance
Average Cost per
downstream user per
€ 850
€ 847
€ 827
substance (€s)
Annex VII+
- No
Diffuse/
Dispersive
Use
Criterion in
Annex III
Annex VII+
- No Annex
III
Annex
VII++ - No
Diffuse/
Dispersive
Use
Criterion in
Annex III
31,445
51,575
90,841
2,117
3,473
4,927
14.9
14.9
18.4
€ 134.7
€ 217.0
€ 436.6
€ 63,645
€ 62,496
€ 88,606
74
74
92
€ 860
€ 845
€ 963
6.3.2 Impacts of withdrawal on innovation and competition - DUs
The effects of substance withdrawal on competitiveness and innovation on DUs depend on the
extent to which these enterprises are dependent on the specific substances in question in terms of
turnover/ profitability, the availability of substitutes and/ or costs of reformulation or developing
REACH 1- 10 tonnes Phase 2
RPA & CSES | 74
new alternatives. Reputational impact may also be a consideration for some, in particular those that
are final consumer facing.
Generally speaking, larger companies are more resilient as regards the effects of substance
withdrawal, as will be smaller highly profitable firms (unless it is the highly profitable items that are
being withdrawn). Withdrawal will probably affect SMEs more than larger firms but there is little
more that can be said without referring to the particular circumstances of different kinds of DUs and
the substances in question.
Given these general comments, working from the baseline and through the options the following
changes are anticipated:

Baseline (Current Annex III and Annex VII information): Given the large number and wide
range of DUs, it is not possible to make very specific comments about the effects of the
different options on competitiveness and innovation without specifying the type of DU and
sector or sub-sector in question. However, it is apparent that the baseline situation has a
lesser impact compared to the other options in terms of reformulation costs, substances
withdrawn, number of DUs affected, etc.
Withdrawals will change the current competitive balance between firms and industries.
Where substances are withdrawn from the market users will have to either exit that market
or invest in developing new substances or reformulating, incurring a cost that their
competitors are not incurring and thus putting them at a disadvantage (e.g. where similar
products are made with different processes/ substances, and one has been withdrawn but
the other not). Where this cannot be done on an economic basis, users will be exiting that
market. The extent to which innovation will be affected will depend on the cost/ risk/ return
ratio in question.

Removal of the diffuse/dispersive use criterion in Annex III: has the effect of increasing the
number of substances required to generate and submit full tox and ecotox information.
When combined with options for changing the information required in Annex VII, this has
the following effects:
o
Annex VII (No Diffuse Dispersive Use Criterion in Annex III): this leads to increasing
the number of substances withdrawn by 55% (to 2,025), the tonnage withdrawn by
a similar amount and also costs of reformulation, as compared to the baseline
situation. The number of DUs affected rises from 95,000 to 150,000. Those
suffering substance withdrawal that are not able to readily reformulate, or
otherwise find alternatives, will be negatively impacted and their competitive
position weakened, in some cases this might lead to exit. This is particularly likely to
be the case with lower value added substances, and the industries and sectors
dependent on those substances. The extent to which innovation will be affected will
depend on profitability in the sector, and alternatives available, e.g. relocation to
outside the EU/ EEA.
o
Annex VII+ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are
slight changes to the information required (Annex VII+), the effect is to marginally
increase the effects on competitiveness and innovation compared with the no
change in Annex VII option.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 75
o
Annex VII++ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are
more significant changes to the information required (Annex VII++), the effect is to
substantially increase the presence of the all the key factors that that drive changes
in competitiveness and innovation. In the first place it increases the number of DUs
affected by withdrawal to 453,000 (compared to 157,000 in the previous VII+
option). The number of substances withdrawn rises to 4,927 (a factor of 3.8
compared to the baseline). The total tonnage withdrawn also increases substantially
to 90,841 tonnes.
The net effect is that there is a substantial increase in the impact on competitiveness
of the firms in question compared with the no change in Annex VII option. Many
more will be side-tracked from their daily business as usual situation by having to
review product line viability, considering reformulations, development of new
products, or product withdrawals as a result. Lower margin sectors, or users of
lower margin substances, are likely to be more negatively affected. Some
consolidation and exit in product lines and numbers of is likely to occur. The rather
negative state of the EU economy will make adjustment harder.
The net effect on innovation, as indicated, is hard to specify with any deal of
certainty, and will depend on cost/ profit/ risk calculations for the products affected.

Removal of Annex III: This has the effect of requiring full tox and ecotox information to be
submitted for all substances (so significantly increasing the number of substances submitting
full information). When combined with options for changing the information required in
Annex VII, this has the following effects:
o
Annex VII (No Annex III): Where there are no changes in the information required in
Annex VII, the effect is to increase the number of DUs affected by 151,000 from the
baseline 95,000 to 246,000. Substances withdrawn increase to 3,324 from the
baseline position of 1305 (75%), and tonnage withdrawn increases by a factor of 2.6
from the baseline position. These are quite substantial increases as compared to the
baseline and even the Annex VII and Annex VII+ options.
As regards competitiveness, effects will be similar to those identified in other
options, but on a different scale. Those experiencing substance withdrawals will find
their competitive position weakened, especially if at short notice. Those in the
relevant sectors not using the withdrawn substances will find their competitive
positions improved. Users will have the options of reformulation-innovation/
consolidation/ exit.
The net effect on innovation will be determined by the cost/ profit/ risk calculus. As
indicated above, given the wide variety of DUs, it is not possible to generalise.
o
Annex VII+ (No Annex III): Where there are slight changes to the information
required (Annex VII+), there are only marginal changes in the factors underlying
competitiveness and innovation relative to no change in the information required in
Annex VII. The net effect is that there will not be a material difference as compared
to that situation.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 76
6.4 Impact of registration on manufacturers and importers (MIs)
6.4.1 Costs and impacts
The overall costs of substance registration to MIs have been described in Section 5.4. As can be seen
from the summary Table 6.10, MI registration costs make up between 68% and 87% of the total cost
of the baseline and options to MIs (and between 26% and 39% overall). As can be observed from
these data, despite the fact that costs of registering individual substances increase with higher
information options (and alterations to Annex III), the weight of the registration costs in the totals is
lower for the higher options. This is because a greater number of substances are withdrawn from
the market in the higher options (hence there are fewer substances being registered in the higher
options).
Table 6.10: Summary and total costs of the options (all values expressed as Present Values discounted at
4%)
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
MI costs of registration
€ 206.4
€ 258.7
€ 346.7
€ 263.9
€ 356.0
€ 323.7
(€ millions)
Total Costs to MIs
€ 237.9
€ 308.1
€ 427.2
€ 315.1
€ 439.8
€ 476.0
(€millions)
Total costs (€ millions)
€ 525.2
€ 693.8
€ 977.4
€ 713.8
€ 1,012.8
€ 1,236.3
MI costs of registration
as % of total cost to
MIs
87%
84%
81%
84%
81%
68%
MI costs of registration
as % of total costs (MIs
and DUs)
39%
37%
35%
37%
35%
26%
Where Section 5.4 has focussed on the costs of registering substances on a substance by substance
basis, this section explores the impact of registration viewed across all of the substances in the
portfolios of companies of different sizes and, hence, on company profit and loss accounts overall.
Here, as noted in Section 5.4, 50% of the registration costs are assumed to be absorbed by the MIs
(and 50% passed on to downstream users in increased prices). Table 6.11 provides the average cost
of substance registration for companies of each size category. These costs are averaged out across
all of the substances in the portfolios of each of the companies registering in the simulation and so
provide information on the magnitude of costs absorbed for every substance registered. These costs
are also provided per tonne of substance produced (over a four year period – so 10t of annual
production = 40t total in the period).
Variation between companies of different sizes
In terms of variations in the scale of impacts between companies of different sizes (and the potential
for disproportionate impacts on smaller companies), costs per substance (and per tonne of
REACH 1- 10 tonnes Phase 2
RPA & CSES | 77
substance) vary only slightly between the micro, small and medium enterprises. The Monte Carlo
simulation data suggests that costs for the larger companies are slightly less than the SMEs owing to
the fact that, for a proportion of substances, some or all of the Annex VII tox and ecotox are already
available and, for these substances, it is assumed in the Monte Carlo model that this information is
owned by (and must be purchased from) larger companies. This has a tendency to push down the
costs for larger MIs when compared with smaller ones.
Table 6.11: Average costs of substance registration for MIs
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
Average cost of registering a substance (across all substances in company portfolios)
Micro companies
€ 2,370
€ 3,104
€ 4,418
€ 3,174
€ 4,541
€ 4,142
Small Companies
€ 2,450
€ 3,154
€ 4,407
€ 3,224
€ 4,536
€ 4,172
Medium Companies
€ 2,596
€ 3,280
€ 4,396
€ 3,342
€ 4,511
€ 4,337
Large Companies
€ 2,230
€ 2,568
€ 3,184
€ 2,630
€ 3,319
€ 3,951
Total
€ 2,401
€ 3,112
€ 4,374
€ 3,181
€ 4,499
€ 4,159
Average cost of registering a substance per tonne of produced (across all substances in company portfolios)
Micro companies
€ 72
€ 94
€ 134
€ 96
€ 138
€ 126
Small Companies
€ 74
€ 95
€ 134
€ 97
€ 137
€ 127
Medium Companies
€ 78
€ 98
€ 132
€ 100
€ 136
€ 131
Large Companies
€ 63
€ 73
€ 91
€ 75
€ 95
€ 113
Total
€ 72
€ 94
€ 132
€ 96
€ 136
€ 126
Change in company average per substance registration costs between options
Working from the baseline and through the options the following changes in company average per
substance registration costs:

Baseline (Current Annex III and Annex VII information): company average per substance
registration costs under the baseline are around €2,400 per substance;

Removal of the diffuse/dispersive use criterion in Annex III: has the effect of increasing the
number of substances required to generate and submit full tox and ecotox information.
When combined with options for changing the information required in Annex VII, this has
the following effects:
o
Annex VII (No Diffuse Dispersive Use Criterion in Annex III): Where there are no
changes in the information required in Annex VII, the cost increases by €713 from
the baseline to €3,112 per substance overall (an increase of 30%);
o
Annex VII+ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are slight
changes to the information required (Annex VII+), the effect is to further increase
the costs by an additional €69 per substance (relative to no change in the
REACH 1- 10 tonnes Phase 2
RPA & CSES | 78
information required in Annex VII) to €3,181 per substance. The net effect is that
costs increase to €780 per substance million above the baseline (an increase of 32%
- 2% higher than the no change in Annex VII option);
o

Annex VII++ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are
more significant changes to the information required (Annex VII++), the effect is to
further increase the costs by an additional €1,047 per substance (relative to no
change in the information required in Annex VII). The net effect is that costs
increase to €1,758 per substance above the baseline (an increase of 73% - 43%
higher than the no change in Annex VII option);
Removal of Annex III: This has the effect of requiring full tox and ecotox information to be
submitted for all substances (so significantly increasing the number of substances submitting
full information). When combined with options for changing the information required in
Annex VII, this has the following effects:
o
Annex VII (No Annex III): Where there are no changes in the information required in
Annex VII, the cost increases by €1,973 per substance from the baseline to €4,374
per substance overall (an increase of 82%);
o
Annex VII+ (No Annex III): Where there are slight changes to the information
required (Annex VII+), the effect is to further increase the costs by an additional
€125 (relative to no change in the information required in Annex VII) to €4,499 per
substance. The net effect is that costs increase to €2,098 above the baseline (an
increase of 87% - 5% higher than the no change in Annex VII option);
Variations in costs
As with the average costs provided in Section 5.4, the averages provided above conceal some
variation in costs from one company to another. Figures 6.1 and 6.2 provide average per company
costs per substance (Figure 6.1) and per tonne of substance (Figure 6.2) graphically, showing the
frequency distribution of different magnitudes of cost under the different options.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 79
Figure 6.1: Average cost of registration for MIs per substance in portfolio
Average cost of registration for MIs per substance in portfolio
25.0%
15.0%
Baseline
Annex VII No diffuse/dispersive use criterion
Annex VII No Annex III
10.0%
Annex VII+ No diffuse/dispersive use criterion
Annex VII+ No Annex III
Annex VII++ No diffuse/dispersive use criterion
5.0%
-5.0%
Present Value Cost per 1-10t substance in Company Portfolio
REACH 1- 10 tonnes Phase 2
RPA & CSES | 80
€ 13,000
€ 12,000
€ 11,000
€ 10,000
€ 9,000
€ 8,000
€ 7,000
€ 6,000
€ 5,000
€ 4,000
€ 3,000
€ 2,000
€ 1,000
0.0%
€0
Percent of manufacturers/importers
20.0%
Figure 6.2: Cost of registration for MIs per tonne of chemical produced (and registered)
Cost of registration for MIs per tonne of overall chemical production
16.0%
14.0%
10.0%
Baseline
8.0%
Annex VII No diffuse/dispersive use criterion
Annex VII No Annex III
Annex VII+ No diffuse/dispersive use criterion
6.0%
Annex VII+ No Annex III
Annex VII++ No diffuse/dispersive use criterion
4.0%
2.0%
-2.0%
Cost per tonne of production (€)
REACH 1- 10 tonnes Phase 2
RPA & CSES | 81
€ 400
€ 350
€ 300
€ 250
€ 200
€ 150
€ 100
€ 50
0.0%
€0
Percent of manufacturers/importers
12.0%
6.4.2 Impacts of registration on innovation and competition - MIs
For MIs, registration costs can impact on competitiveness and innovation in several ways. Increases
in costs can lead to reductions in profitability, or increased prices, or both. MIs may wish to cease
the production of a substance that they no longer consider worthwhile to produce given economic
viability calculations. Another option adopted by MIs is to consolidate production, for example, to
agree with a competitor that they produce the substance and buy it from them, to sell under their
own brand. Or MIs may decide to use an existing substitute (and reformulate) or develop a new one
Generally speaking, in the case of lower value substances there is likely to be some consolidation
and reduction in competition. It is unlikely that this will drive significant innovation at this end of the
market.
Manufacturers of low value substances based in countries outside the EU will be reluctant to invest
in registration, as will be their EU-based users, which might lead to the substances being imported in
articles manufactured outside the EU.
Given these general comments, working from the baseline and through the options the following
changes are anticipated:

Baseline (Current Annex III and Annex VII information): this suggests an average cost of
registration of some €2,200 - €2,600 per substance, with total registration costs at some
€206 million. While this does not appear as a significant sum for an individual firm, if some
substances sell at €15 per tonne, and they are being sold in quantities of less than 10 tonnes
per year, it is clearly going to be questionable whether to continue with production or not,
with all the concomitant knock-on consequences that may follow for DUs as a result of
withdrawal. On the other hand, if the substance is selling at €500 per tonne, it becomes
more interesting, depending on how many tonnes are sold per year. However, it is worth
bearing in mind that some relatively low value items, such as dyes, are imported in very low
volumes, sometimes in quantities of less than 1 tonne per year.
It is therefore likely that MIs working with relatively lower value and lower volume products
will be more negatively influenced than higher value ones (assuming that they cannot
increase prices), and there will probably be more consolidation and exit at that end of the
market.

Removal of the diffuse/dispersive use criterion in Annex III: has the effect of increasing the
number of substances required to generate and submit full tox and ecotox information.
When combined with options for changing the information required in Annex VII, this has
the following effects:
o
Annex VII (No Diffuse Dispersive Use Criterion in Annex III): this increases
registration costs by 25.3% and average cost of registration per substance by 30%,
which is relatively equally distributed between the micro, small, medium and larger
firms. The effects of such an increase on the viability of low value substances should
be readily apparent. It suggests quite a significant shift and effects on
competitiveness will depend on the share of such products in the company’s
portfolio. This may drive substitution with existing alternatives or innovation to
develop alternatives, although it will probably be difficult to find appropriate low
cost alternatives.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 82
o
Annex VII+ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are
slight changes to the information required (Annex VII+), the incremental effect vis a
vis the situation where no changes are required is so marginal as to make it of no
material difference as compared to the no change in Annex VII option;
o
Annex VII++ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are
more significant changes to the information required (Annex VII++), the effect is to
increase registration costs by 73% compared to the baseline and 30% compared to
the situation where more a modest increase in the information requirements exists.
The effect of this is reflected in the higher level of substance withdrawals as
indicated in 6.2.2 above. The net effect in terms of competitiveness is that there will
be a mix of withdrawals and consolidations, an overall concentration in the market,
but more so than with previous options, which will have a negative impact on those
firms and those DUs dependent on their products.
As regards innovation, the extent to which this occurs will be driven by the costs/
profits/ risks/ calculus, but of course in a low tonnage market the value added per
substance will be very important.

Removal of Annex III: This has the effect of requiring full tox and ecotox information to be
submitted for all substances (so significantly increasing the number of substances submitting
full information). When combined with options for changing the information required in
Annex VII, this has the following effects:
o
Annex VII (No Annex III): Where there are no changes in the information required in
Annex VII, the effect is to increase registration costs to MIs by 68% above the
baseline, and average registration costs by 82% above the baseline to €4,374. This is
slightly higher for micro firms at €4,418, and less for large firms at €3,184. But it is
clear that it will reduce the competitiveness of some substances significantly as
compared to the baseline and accordingly firms supplying those products who wil
restructure their product portfolios accordingly.
As far as innovation is concerned, this will lead to some reformulations and search
for existing substance substitutes, but it is worth bearing in mind that all new
substances in this tonnage category are in this “expensive” No Annex III plus Annex
VII option – they all have to gather the Annex VII info whereas the phase in (existing)
substances do not. So at the moment there is a discrepancy between the two which
goes against innovation (new substances) in this case.
o
Annex VII+ (No Annex III): Where there are slight changes to the information
required (Annex VII+), the effect on competition and innovation is so marginal that it
is not material relative to no change in the information required in Annex VII.
REACH 1- 10 tonnes Phase 2
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6.5 Impact of registration on downstream users (DUs)
6.5.1 Cost and impact
The overall costs of substance registration to DUs have been described in Section 5.4 where these
are associated with 50% of the costs of substance registration being passed on to DUs in prices.
As can be seen from the summary Table 6.12, DU registration costs make up between 43% and 72%
of the total cost of the baseline and options to DUs (and between 26% and 39% overall). As can be
observed from these data, despite the fact that costs of registering individual substances increase
with higher information options (and alterations to Annex III), the weight of the registration costs in
the totals is lower for the higher options. This is because a greater number of substances are
withdrawn from the market in the higher options (hence there are fewer substances being
registered in the higher options).
Table 6.12: Summary and total costs of the options (all values expressed as Present Values discounted at
4%)
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
DU costs of registration
€ 206.4
€ 258.7
€ 346.7
€ 263.9
€ 356.0
€ 323.7
(€ millions)
Total costs to DUs
€ 287.4
€ 385.7
€ 550.2
€ 398.7
€ 573.0
€ 760.3
(€millions)
Total costs (€ millions)
€ 525.2
€ 693.8
€ 977.4
€ 713.8
€ 1,012.8
€ 1,236.3
DU costs of registration
as % of total cost to
72%
67%
63%
66%
62%
43%
MIs
DU costs of registration
as % of total costs (MIs
39%
37%
35%
37%
35%
26%
and DUs)
In terms of the impacts of registration costs on individual DUs through price rises, little is known
about the numbers of downstream users other than, despite the low tonnages involved, there may
be several on average, each using low volumes of the substances.
An estimate has been made on the cost of each option to individual downstream users by assuming
five downstream users per tonne of each substance. This results in the average price increases per
substance per downstream user provided in Table 6.13. As can be seen from these data, average
price increases per substance per DU are fairly low and are similar across the options ranging
between €73 and €100 per substance per DU under the options and €57 under the baseline.
As with the average costs provided in Section 5.4, the averages provided in Table 6.12 conceal some
variation in price increases from substance to another. Figure 6.3 provides price increases per DU
per substance graphically, showing the frequency distribution of different magnitudes of price
increases under the different options.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 84
Table 6.13: Average costs of registration for Downstream Users
Baseline
Annex VII - Annex VII - Annex VII+ Annex VII+
Annex
No
No Annex
- No
- No Annex VII++ - No
Diffuse/
III
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Dispersive
Use
Use
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
Average cost of registering a substance (across all substances in company portfolios)
Average tonnes
production per
38.7
39.6
41.6
39.7
41.8
43.2
substance
Average cost of
registration for DUs
per substance (price
€ 11.0
€ 14.4
€ 20.8
€ 14.8
€ 21.5
€ 21.5
increase)
(€ thousand)
Average number of
193
198
208
199
209
216
DUs per substance
Average price increase
per DU per substance
€ 57
€ 73
€ 100
€ 74
€ 103
€ 99
(€s)
6.5.2 Impacts of registration on innovation and competition - DUs
From the point of view of this simulation registration impacts DUs primarily through costs passed on
by price increases from MIs.
For the DUs of higher value added items, whether manufactured in the EU or imported, it is unlikely
that there will be significant, if any, impacts on competitiveness and innovation as the substances
should be able to absorb costs and/or pass on price increases. There does not appear, prima facie,
to be any significant driver for increased innovation from this point of view either.
However, for users of lower cost substances, e.g. imported dyes, using them in formulations and
creation of articles, here might be a reluctance to register leading to withdrawal (and thus pushing
up registration costs for those remaining in the market). It is also conceivable that some articles
(e.g. film coatings) might be withdrawn from the market unless those article producers can find
alternative supplies or substitutes, so there could be some drivers for innovation in the lower value
added items.
REACH 1- 10 tonnes Phase 2
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Figure 6.3: Average cost of registration per DU per substance
Average cost of registration per Downstream User per substance
20.0%
18.0%
14.0%
12.0%
Baseline
Annex VII No diffuse/dispersive use criterion
10.0%
Annex VII No Annex III
8.0%
Annex VII+ No diffuse/dispersive use criterion
Annex VII+ No Annex III
6.0%
Annex VII++ No diffuse/dispersive use criterion
4.0%
2.0%
Cost per Downstream User per substance (€)
REACH 1- 10 tonnes Phase 2
RPA & CSES | 86
€ 350
€ 300
€ 250
€ 200
€ 150
€ 100
-2.0%
€ 50
0.0%
€0
Percent of manufacturers/importers
16.0%
Given these general comments, working from the baseline and through the options the following
changes are anticipated:

Baseline (Current Annex III and Annex VII information): In the baseline position, total
registration costs borne by DUs is in the region of €206.4 million, while the average cost
increase from registration per DU is €11,000. Average price increase per DU per substance is
€ 57. The effect on the competitiveness of the DU in question will be determined in large
part by the share of the substance in the cost of the final or intermediate good they provide,
and the and the extent to which the increase can be passed on or has to be absorbed. This is
determined by the specific market situation in question.

Removal of the diffuse/dispersive use criterion in Annex III: has the effect of increasing the
number of substances required to generate and submit full tox and ecotox information.
When combined with options for changing the information required in Annex VII, this has
the following effects:
o
Annex VII (No Diffuse Dispersive Use Criterion in Annex III): this has the result of
increasing registration costs for DUs by 25.4% above the baseline, increasing the
average cost of registration for DUs for each substance to €14,400 (from €11,000),
and the average price increase for each DU for each substance by 27%.
This represents quite a significant hike for the substances affected. For higher
value substances, it will probably be possible to absorb more of the increase or to
pass it on, and there might be relatively few competitive effects in that sector of the
market. However, for lower value substances, it may no longer be economically
justifiable to keep them in use which will lead to either withdrawal of the product or
consolidation of suppliers who can supply in in higher more economically viable
volumes.
Alternatively, DUs will seek to reformulate or substitute with new or existing
substances that do not incur such high costs. The DU market is so large and
differentiated that it is difficult to be more specific without referring to the
particular markets in question.
o
Annex VII+ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are
slight changes to the information required (Annex VII+), the effect is so marginal that
there are no material differences as compared with the no change in Annex VII
option);
o
Annex VII++ (No Diffuse/Dispersive Use Criterion in Annex III): Where there are
more significant changes to the information required (Annex VII++), the effect is to
shift the break-even point for those substances even higher. Registration costs
increase by 57% as compared to the baseline and the average cost of registration for
DUs per substance rises to €21,500 from the €11,000 baseline cost. It is highly likely
that this will result in some significant review of portfolios, consolidation and exit,
especially in the case of lower value substances.
It should also lead to some significant innovative activity, depending of course on
the expected costs, profits and risks in question. Lower cost solutions (e.g.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 87
reformulating with an existing substance) would tend to be tried first, as new
substance development is quite expensive especially at lower tonnages.

Removal of Annex III: This has the effect of requiring full tox and ecotox information to be
submitted for all substances (so significantly increasing the number of substances submitting
full information). When combined with options for changing the information required in
Annex VII, this has the following effects:
o
Annex VII (No Annex III): Where there are no changes in the information required in
Annex VII, the effect is to increase the DU costs of registration by 68% over the
baseline, the average cost of registration for DUs per substance (price increase) from
the baseline of €11,000 to €20,500 (nearly double) and the increase in average price
paid per DU per substance rises from €57 to €100.
These are quite significant increases, similar in effect to the VII+ and VII++ options
above and should probably have similar consequences for competition and
innovation.
o
Annex VII+ (No Annex III): Where there are slight changes to the information
required (Annex VII+), the effect is, again, marginal and not materially different from
the situation where there is no change in the information required in Annex VII.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 88
7 Benefits
7.1 Numbers of hazardous substances and properties identified
The five options considered are expected to deliver benefits on the human health and the
environment through the improvement of the data on substance classifications. This allows the
provision to registrants and downstream users of better information on the hazards of the
substances in form of enhanced or more appropriate risk management measures for the safe use
and handling of the chemicals. In turn, the data on substance classifications feeds across into other
legislation that requires that risks form substances and mixtures are managed (e.g. CAD, CMD).
As discussed in Section 3, the options aim to generate better information (and on more substances)
in particular regarding:





Carcinogenicity, mutagenicity and reprotoxicity;
Dermal, inhalation and/or oral toxicity;
Long term toxicity;
Aquatic toxicity; and
Persistence, bioaccumulation and toxicity.
Where it becomes available, better information on short term toxicity, long term toxicity and aquatic
toxicity under the higher information options (Annex VII+ and VII++) will lead to the identification of:



Substances for which there is better information on dermal/inhalation exposure limits;
Substances identified with classification from STOT RE 1 or 2; and
Number of aquatic toxic substances with enough information for PNEC where applicable.
Table 7.1 presents the number of substances with the above hazard category classifications that the
options are predicted to identify31 and the total costs for each option (as described in Section 5).
Figure 7.1 presents the same information graphically as well as the total cost of each option.
As can be seen from Figure 7.1, the Annex VII++ is the most expensive but, owing to the use of two
tests for mutagenicity screening, also the one able to capture the highest number of mutagenic
substances. Owing to additional information requirements in relation to dermal and inhalation
endpoints and repeated dose toxicity, it is the only option able to capture substances with dermal,
inhalation and/or oral toxicity, with better information on dermal/inhalation exposure limits, with
long term toxicity and with classification for STOT RE 1 or 2.
In terms of identifying substances that are acutely toxic to aquatic organisms, all information options
have the same potential (in terms of the information required for identification) and the options
vary only in respect of the number of substances undergoing that (full) testing. This is governed by
Annex III and the associated options. However, in terms of information required to manage the risks
associated with these substances, only the higher information options (Annex VII+ and VII++) are
able to provide sufficient information for derivation of PNECs (which in turn, could be used to inform
31
For a description of the functioning of the model, see Section 4 and Annex 2.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 89
limit values). Under these options, a substance that is identified as acutely toxic to aquatic
organisms must obtain information from a third test (where this is not currently required under
Annex VII).
Table 7.1: Total costs and number of substances identified per hazard category
Baseline
Annex VII - Annex VII - Annex VII+
No
No Annex
- No
Diffuse/
III
Diffuse/
Dispersive
Dispersive
Use
Use
Criterion in
Criterion in
Annex III
Annex III
Total costs (MIs and
€ 525.2M
€ 693.8M
€ 977.4M
€ 713.8M
DUs - € millions)
No. of substances
classified for skin/eye
2,184
3,707
6,217
3,707
damage and irritation
No. of substances
classified for skin
448
798
1,238
798
sensitisation
CMR 1A/1B
120
142
191
142
Dermal, inhalation
0
0
0
0
and/or oral toxicity
With better information
on dermal/inhalation
0
0
0
0
exposure limits
Long term toxicity
0
0
0
0
With classification for
0
0
0
0
STOT RE 1 or 2
Acute Aquatic toxicity
677
1,100
1,680
1,110
With enough
0
0
0
1,454
information for PNECs
PBTs
0
0
0
36
Annex VII+
- No Annex
III
Annex
VII++ - No
Diffuse/
Dispersive
Use
Criterion in
Annex III
€ 1,012.8M
€ 1,236.3M
6,217
3,707
1,238
798
191
250
0
4,068
0
4,351
0
1,175
0
65
1,680
1,110
2,024
1,454
58
36
The same is also true of the identification of PBT/vPvB substances. All of the higher information
options (Annex VII+ and VII++) require PBT/vPvB screening and, where this suggests the potential for
PBT/vPvB properties, further testing to inform PBT/vPvB assessment is required. Such screening and
assessment is not currently required under Annex VII and, hence, it cannot be assumed that it will be
undertaken and no PBTs/vPvBs will be identified. As with other common requirements and
endpoints, any variation between the higher information options in terms of numbers of substances
identified is associated only with the number of substances undergoing testing which, as already
noted, depends on Annex III and associated options.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 90
Figure 7.1: Total costs (€ million) and number of substances identified per hazard categories
REACH 1- 10 tonnes Phase 2
RPA & CSES | 91
7.2 Impact of the Options on Damage Costs
7.2.1 Introduction
A full economic analysis of the economic benefits of identifying additional substances and hazardous
properties would require exposure-response functions for each chemical substance and for each
human health and environmental effect. In addition, information on the population/area exposed
would also be required to enable the prediction of economic value of damages avoided. To be
strictly rigorous, such an analysis would also require consideration of the distribution of the benefits
over time and selection of an appropriate discount rate.
As detailed information of this kind does not currently exist, as with the Commission’s 2003
Extended Impact Assessment, an illustrative benefits approach must be employed to explore the
benefits of the options and, therein, the relative performance of the options (and the baseline). In
overview, this approach has involved:

considering how many hazardous substances with different properties for classification are
identified under the options and under the baseline (as in Figure 7.1);

considering the nature of disorders, diseases and impacts associated with substances with
such classifications;

identifying an appropriate economic metric for a single case avoided or unit of
environmental area improved for each type of substance classification identified (in €s);

applying conservative assumptions concerning the numbers of cases avoided/environmental
area improved per substance classification identified over a 30 year period following
registration32; and

combining the above to calculate conservative illustrative benefits (in €s) for each of the
options, the baseline and also the total human health and environmental damages that
could be avoided if all hazardous substances were identified. The latter can be calculated by
considering the total number of hazardous substances/properties that are (as yet)
unidentified.
These steps and the outcomes are described in the following sub-sections.
7.2.2 Estimated damage costs of substances with different classifications
Carcinogens and mutagens
Owing to the severity of the health effects of exposure, the benefits of identifying CMRs and
reducing/eliminating exposures are large compared with other, more minor, health effects.
32
Where 30 years is consistent with the illustrative benefits approach used in the Commissions Extended
Impact Assessment of 2003.
REACH 1- 10 tonnes Phase 2
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In terms of the benefits of identifying CMRs for the 1-10t substances, owing to the fact that testing
for carcinogenicity and reproductive toxicity is not required for the 1-10t substances (under any of
the options), only mutagenic substances will be identified for classification33 and, thus, only the ‘M’
component of CMRs will be identified for classification under the options (and the baseline).
This, however, does not mean that the baseline and the options have no benefits in terms of
reduced exposure to carcinogenic substances. Mutagens may also be carcinogens (even if they are
not classified as such) and the risk management measures that would be required to
reduce/eliminate exposure to mutagenic substances will also reduce/eliminate exposure to any
carcinogenic effects that these same substances may have. Analysis of the harmonised classification
in the Classification and Labelling Inventory suggests that 99% of substances classified as mutagenic
1A/1B are also classified as carcinogenic 1A/1B.
On the basis of this, it is assumed that all of the mutagens identified are also carcinogens and
benefits can be calculated using the monetary values assigned to lethal and non-lethal cancers. The
following are assumed in terms of the value of each:

lethal cancer - estimated at €2 million per case; and

the willingness to pay to avoid a non-lethal cancer, estimated in €450,00034.
Skin Sensitizers and irritants
Skin sensitizers and irritants are present in a wide range of products and are the cause of skin
disorders. According to EU-OSHA “occupational skin diseases are estimated to cost the EU €600
million each year, resulting in around 3 million lost working days. They affect virtually all industry
and business sectors and force many workers to change jobs” 35.
33
Because under the Integrated Testing Strategy (ITS) limits consideration to mutagenicity testing (i.e. it does
not extend to carcinogenic/reproductive effects). As such classifications can only be made for
mutagenicity.
34
ECHA (2008): Guidance on Socioeconomic Analysis – Restrictions, page 84 uses a WTP value of €400,000,
resulting in a 2014 value of around €450,000 (using OECD inflation rates). ECHA (2008) available at:
http://echa.europa.eu/documents/10162/13641/sea_restrictions_en.pdf
EU-OSHA Factsheet 40. Available at: https://osha.europa.eu/en/publications/factsheets/40
35
REACH 1- 10 tonnes Phase 2
RPA & CSES | 93
In terms of the cost of health effects related to skin diseases the following values have been applied:



The health care cost for “rash or other non-specific skin eruption” is around €72036 per
case37;
The lost productivity per skin disease case is around €72038; and therefore
the total cost of a case of ‘skin disease’ is €1,440 per case.
Acute and chronic toxic substances
In terms of the value of health effects caused by acute and chronic toxic substances, the following
values have been applied:
36
37
38
39
40
41

With regard to substances identified with dermal, inhalation and/or oral toxicity
classifications, the medical treatment cost of €1,37039 has been assumed to be the average
cost in the EU for a ‘non-fatal poisoning incident’; the value has been added to €1,200 of lost
productivity (assuming that a poisoning event results in 5 days’ sick leave) to give a total cost
of €2,570 for a ‘non-fatal poisoning incident’;

With regard to substances identified with long term toxicity classifications, kidney disease
has been considered as an end-point; the medical treatment of €4,50040 has been assumed
to be the average cost in the EU; the value has been added to €4,800 of lost productivity
(assuming that a chronic kidney disease results in 20 days’ sick leave) to give a total cost of
€9,300 for a ‘kidney disease not requiring a transplant’;

With regard to substances with classification for STOT RE 1 or 2, kidney disease resulting in
transplant has been considered as end-point; the medical treatment of €38,50041 has been
applied; the value has been added to €9,600 of lost productivity (assuming that a poisoning
event results in 40 days’ sick leave) to give a total cost of €48,100 for a ‘kidney disease
requiring a transplant’.
NHS (2013): National Schedule of Reference Costs Year: 2012-13. The medical treatment cost per patient is
around £550. Applying an exchange GBP/EUR of 1.3 (19/01/2015), the medical treatment costs is of
around £720. Schedule Reference Costs available at: https://www.gov.uk/government/publications/nhsreference-costs-2012-to-2013
This is the cost in the UK; it is assumed that the average cost in the EU28 is equivalent.
Labour
productivity
per
hour
worked
is
€32.1
in
the
EU28
(http://epp.eurostat.ec.europa.eu/tgm/table.do?tab=table&init=1&plugin=1&language=en&pcode=tsdec3
10); assuming a work day of 7.5 hours and three days’ sick leave per case per year (Pickvance et al, 2005)
gives €722.
Unit cost referring to “Poisoning, Toxic, Environmental and Unspecified Effects” (UK National Schedule of
Reference Costs for the year 2012-13).
Average unit cost referring to “Chronic Kidney Disease with and without Interventions” plus the average
cost of haemodialysis, filtration or peritoneal dialysis (UK National Schedule of Reference Costs for the year
2012-13).
Average unit cost referring to “Kidney Transplant” plus “Live Kidney Donor Screening” plus “Kidney PreTransplantation Work-up of Live Donor” plus “Kidney Pre-Transplantation Work-up of Recipient” plus
“Examination for Post-Transplantation of Kidney of Recipient” plus “Live Donation of Kidney” (UK National
Schedule of Reference Costs for the year 2012-13).
REACH 1- 10 tonnes Phase 2
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Environment
For an indication of the level of environmental damages that would have to be prevented by the
policy options in order to make their implementation economically justified, the willingness to pay of
UK households for improving the quality of water bodies to different Water Framework Directive
Status levels is used as an indicator42. So called NWEBS (National Water Environment Benefit Survey
values) are used in the UK as part of the assessment of the costs and benefits of catchment level
projects to increase the status of water bodies. Total NWEB values reflect improvement in six
components of waterbody status. These are: fish; other animals such as invertebrates; plant
communities; the clarity of the water; condition of the river channel/flow of water; and the safety of
the water for recreational contact. Where projects/actions only target some of these components
the approach used in the UK is to divide the overall NWEB values equally between the six
components and then multiply by the number of components that are affected by the
action/project. The annual average per component NWEB values applied in England and Wales are
as follows for the following levels of improvement:



from “bad” to “poor”: €4,083 per km river per year per component;
from “poor” to “moderate”: €8,793 per km river per year per component;
from “moderate” to “good”: €14,243 per km river per year per component.
To estimate the benefits of identifying substances which are toxic to aquatic life it has been assumed
that three components will be affected (fish; other animals such as invertebrates; plant
communities). It is also assumed that:

The identification of acute aquatic toxic substances but without an associated PNEC would
result in the quality of water bodies improving from “bad” to “poor” at a value of €12,250
per km river per year;

The definition of PNECs would result in the setting of more stringent environmental risk
management measures, with the effect of improving the quality of water bodies from “bad”
to “moderate” at a value of €26,380 per km river per year; and

The identification of a PBT, and therefore it’s phasing out over the time, would result in the
quality of water bodies improving from “bad” to “good” at a value of €42,730 per km river
per year.
Values applied
Table 7.2 summarises the metrics applied to each of the hazardous property endpoints, the
monetary values applied to those metrics and the numbers of substances that would be identified
under the options (as in Table 7.1). The table also shows the number of substances that would be
identified as meeting different classifications if all substances were subjected to toxicological and
ecotoxicological testing (including in vivo testing for mutagenicity).
42
Environment Agency (2013): Updating the National Water Environment Benefit Survey values: summary of
the peer review. All benefit values are in 2012 prices. Available at:
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/291464/LIT_8348_42b25
9.pdf
REACH 1- 10 tonnes Phase 2
RPA & CSES | 95
Table 7.2: Metrics applied to hazardous property endpoints, associated monetary values and the numbers of substances identified under the options
Number of substances identified with hazardous properties
Annex VII++
Annex VII Annex VII+ - No
Monetary
No Diffuse/
No Diffuse/
Annex
Annex
Diffuse/
Substance properties
Valuation metric used
Value applied
Dispersive
Dispersive
Baseline
VII - No
VII+ - No
Dispersive
to metric
Use
Use
Annex III
Annex III
Use
Criterion in
Criterion in
Criterion in
Annex III
Annex III
Annex III
Substances classified for
Cost of an incidence of ‘skin
€ 1,440
2,184
3,707
6,217
3,707
6,217
3,707
skin/eye damage and irritation
disease’
Substances classified for skin
Cost of an incidence of ‘skin
€ 1,440
448
798
1,238
798
1,238
798
sensitisation
disease’
Cost of a lethal case of cancer
€ 2,000,000
CM(R) 1A/1B
120
142
191
142
191
250
Cost of a non-lethal case of
€ 450,000
cancer
Substances with better
information on exposure limits
Cost of a ‘poisoning event’
€ 2,570
4,351
for oral and dermal/inhalation
toxicity
Substances with long-term
Cost of ‘kidney disease not
€ 9,300
1,175
toxicity information
requiring transplant’
Substances that would have
Cost of ‘kidney disease
€ 48,100
65
classification for STOT RE 1 or 2
requiring transplant’
Improvement of WFD water
Substances classified for acute
body status from ‘Bad’ to
€ 12,250
677
1,100
1,680
aquatic toxicity
‘poor’ per km2
Substances classified for acute
Improvement of WFD water
aquatic toxicity with enough
body status from ‘Bad’ to
€ 26,380
0
0
0
1,454
2,024
1,454
information for PNECs
‘moderate’ per km2
Improvement of WFD water
PBTs/vPvB substances
body status from ‘Bad’ to
€ 42,730
0
0
0
36
58
36
‘good’ per km2
* this number of substances could only be detected by applying in vivo testing to all substances
** this number of substances could only be detected by applying testing to all substances (as occurs in the absence of Annex III)
REACH 1- 10 tonnes Phase 2
RPA & CSES | 96
Substances
with
hazardous
properties
across all
1-10t
substances
6,217**
1,238**
370*
5,986**
1,616**
90**
-
2,024**
58**
7.2.3 Damage costs avoided
Applying the values described above, damage costs avoided per year can be calculated by
multiplying the numbers of each type of classification identified by the applicable monetary value.
This can then be multiplied by a factor denoting the number of health cases avoided (or km of river
water body improved) per substance classification identified. Clearly, the latter factor is not known
but can be expected to be uniform across the options. A minimum expected value can be derived by
applying conservative estimates of the numbers of health cases avoided or km river waterbody
improved per substance classification identified.
For the purpose of developing illustrative benefit estimates the following conservative assumptions
have been applied:

the identification of a new human health classification results in the avoidance of one case
of disease/disorder (for the appropriate classification metric) per year on average (for
example, the identification of a CMR results in the avoidance of one lethal case of cancer per
year and, in this case, one non-lethal case per year on average);

the identification of a substance that is toxic to aquatic life results in the improvement of
WFD status of one km of river43 (i.e. the total benefits of identifying each substance with
aquatic toxicity are equivalent to the improvement of 1km of river per substance).
Minimum damage costs avoided under the baseline
The baseline situation reflects the current requirements under REACH. Applying the values and
conservative assumptions set out above, Table 7.3 provides the calculated annual damage costs
avoided under the baseline based on one health case avoided per year and one km river waterbody
improved per substance classification identified.
In the table, annual benefits in terms of damage costs avoided have also been aggregated to provide
total present value benefits over a 30 year period (consistent with the Commission’s Extended
Impact Assessment of 2003). Present value human health benefits are assumed to begin in the year
after registration (2019) and are calculated over the period to 2048 (discounted at 4%).
Environmental benefits are assumed to take longer to be established and are assumed to be accrued
in the period 2023-2048 (and are also discounted at 4%).
Applying this conservative illustrative approach suggests that the total PV benefits under the
baseline (current situation) would be around €5,263 million. The estimated costs are €525.2 million.
This, in turn, suggests that the benefit:cost ratio under the baseline is around 10.02.
43
Note: not one per year
REACH 1- 10 tonnes Phase 2
RPA & CSES | 97
Table 7.3: Calculated damage costs avoided under the baseline assuming one case avoided per year/km
improved per hazardous substance identified
Number of
Number of
Damage costs
Monetary
cases
substances
avoided (Number of
identified with
Value
avoided per
Valuation metric used
cases avoided/km
hazardous
applied to
year/km
improved
x monetary
properties under
metric
waterbody
value
(€
millions)
the baseline
improved
Calculation of Annual Human Health Benefits
Cost of an incidence of ‘skin
€ 1,440
€ 3.1
2,184
2,184
disease’
Cost of an incidence of ‘skin
448
448
€ 1,440
€ 0.6
disease’
Cost of a lethal case of cancer
€ 2,000,000
€ 240.0
120
120
Cost of a non-lethal case of
€ 450,000
€ 54.0
cancer
Total human health damage costs avoided (Benefits) - € millions per year
€ 297.8
Calculation of Annual Environmental Benefits
Improvement of WFD water
677
677
€ 12,250
€ 8.3
body status
Human health damage costs avoided (Benefits) - € millions per year
€ 297.8
Environmental damage costs avoided (Benefits) - € millions per year
€ 8.3
Total Present Value (PV) Benefits over the period (discounted at 4%)
Total PV human health damage costs avoided over the benefit period (between
€ 5,149.4
2019 and 2048 inclusive) - € millions total
Total PV environmental damage costs avoided over the benefit period (between
€ 113.3
2023 and 2048 inclusive) - € millions total
Total damage costs avoided (Benefits) - € millions
€ 5,263
Total Costs of complying with the requirements - € millions
€ 525.2
Benefit:Cost Ratio
10.02
By way of comparison, a recent Defra UK study44 the ongoing Defra (UK) assessment of the costs and
benefits of the stock of regulations identified that benefit:cost ratios were between 1.1 and 18.9
across all environmental regulation in the UK and the chemicals and GMOs regulation in particular
was identified to have the highest benefit:cost ratio (18.9). Comparison of the benefit:cost ratio of
10.2 for the baseline (as shown in Table 7.3) with these values suggest that the assumptions and
approach used to estimate the benefits errs on the conservative side and may underestimate rather
than overestimate the benefits.
Minimum damage costs avoided under the options and the baseline
Comparison of benefit:cost ratio for the baseline with information from Defra (UK) suggests that the
metric applied to calculate the benefits provides a reasonable approximation of reality (even if
perhaps an underestimate of the true benefits). As one cannot reasonably expect the factors45
44
Defra (2015): Emerging Findings from Defra’s Regulation Assessment - First update covering 2012 see
https://www.gov.uk/government/publications/the-costs-and-benefits-of-defra-s-regulations
45
For example, the number of health cases avoided/length of waterbody improved per substance classification
newly identified.
REACH 1- 10 tonnes Phase 2
RPA & CSES | 98
underpinning these benefits to vary from the baseline or from one option to another, the same
assumptions and metrics can be applied to the other options to develop estimates of the associated
benefits.
The same approach can also be applied to the expected numbers of substances with (as yet
unknown) hazardous properties that were the starting point for modelling the successfulness of the
different testing strategies applied under the baseline and the options. These substances represent
the population of substances that are currently in use but have (as yet unknown) hazardous
properties46. Applying the same benefit metrics to these substances provides an estimate of the
current total damage costs from human and environmental exposure to hazardous 1-10t substances
over the same 30 year period.
Applying the approaches described above to the numbers of substances and classifications identified
under the options provides estimates of the estimated damage costs avoided under the baseline and
under the options. Table 7.4 provides:




the resulting total PV benefits (from 2018 to 2048);
a comparison of benefit with cost for each option;
the estimated impact of each option on the total avoidable damage costs; and
the residual damage costs (continuing damages from substances whose hazardous
properties have not been identified under a given option).
These data are discussed in more detail in Section 8.
46
All of these substances would only be identified by applying in vivo testing to all 1-10t substances.
REACH 1- 10 tonnes Phase 2
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Table 7.4: Estimated damage costs avoided under the baseline and under the options
Damage Metric
Baseline
Annex VII - No
Diffuse/
Dispersive Use
Criterion in Ann.III
Annual Human Health and Environmental Benefits - €millions per year
‘Skin diseases’ (irritant)
€ 3.1
€ 5.3
€ 0.6
€ 1.1
‘Skin disease’ (sensitiser)
€
240.0
€
284.0
Lethal cancer
Non-lethal cancer
€ 54.0
€ 63.9
‘Poisoning’
‘Kidney disease not requiring transplant’
‘Kidney disease requiring transplant’
€ 8.3
€ 13.5
WFD water body status (aquatic toxics)
WFD water body status (PBTs)
Human health damage costs avoided (Benefits)
- € millions per year
Environmental damage costs avoided (Benefits)
- € millions per year
Damage costs avoided
Annex VII+ - No
Annex VII Diffuse/ Dispersive
No Ann.III
Use Criterion in
Ann.III
Annex VII+
- No Ann.III
Annex VII++ - No
Diffuse/ Dispersive
Use Criterion in
Ann.III
Total
Avoidable
Damage Costs
€ 9.0
€ 1.8
€ 382.0
€ 86.0
€ 20.6
-
€ 5.3
€ 1.1
€ 284.0
€ 63.9
€ 38.4
€ 1.5
€ 9.0
€ 1.8
€ 382.0
€ 86.0
€ 53.4
€ 2.5
€ 5.3
€ 1.1
€ 500.0
€ 112.5
€ 11.2
€ 10.9
€ 3.1
€ 38.4
€ 1.5
€ 9.0
€ 1.8
€ 740.0
€ 166.5
€ 15.4
€ 15.0
€ 4.3
€ 53.4
€ 2.5
€ 297.8
€ 354.4
€ 478.7
€ 354.4
€ 478.7
€ 644.2
€ 952.0
€ 8.3
€ 13.5
€ 20.6
€ 39.9
€ 55.9
€ 39.9
€ 55.9
Total Present Value (PV) Benefits over the period 2018-2048 (discounted at 4%) - €millions
Total Present Value (PV) Benefits (discounted at 4%)
Total PV human health damage costs avoided
€ 5,149.4
over the benefit period (between 2019 and
2048 inclusive) - € millions total
Total PV environmental damage costs avoided
€ 113.3
over the benefit period (between 2023 and
2048 inclusive) - € millions total
Total damage costs avoided (Benefits)
Total Costs
Benefit:Cost Ratio
Impact on damage costs (% of total costs
avoided)
Residual damages (€m)
€ 6,128.1
€ 8,277.4
€ 6,128.1
€ 8,277.4
€ 11,139.9
€ 16,461.6
€ 184.1
€ 281.2
€ 545.0
€ 763.3
€ 545.0
€ 763.3
€ 5,262.7
€ 525.2
10.02
€ 6,312.2
€ 693.8
9.10
€ 8,558.6
€ 977.4
8.76
€ 6,673.1
€ 713.8
9.35
€ 9,040.8
€ 1,012.8
8.93
€ 11,685.0
€ 1,236.3
9.45
€ 17,224.9
31%
37%
50%
39%
52%
68%
€ 11,962.2
€ 10,912.8
€ 8,666.3
€ 10,551.8
€ 8,184.2
€ 5,540.0
REACH 1- 10 tonnes Phase 2
RPA & CSES | 100
8 Conclusions
8.1 Comparing the Options
8.1.1 Introduction
Table 8.1 provides the overall costs, benefits and benefit:cost ratios for all options for changing
information requirements. These are grouped into:

information options also involving changes to Annex III that involve the elimination of the
diffuse/dispersive use criterion such that all substances predicted (by QSARs or existing
information) to have any human health or environmental hazards would be required to
gather the in vitro toxicological and ecotoxicological information appropriate to the
information option; and

information options also involving the removal of all Annex III criteria such that all
substances would be required to gather the in vitro toxicological and ecotoxicological
information appropriate to the information option.
The table also provides a verbal summary of the changes as well as information on:


the residual damage costs under the option/baseline – which is simply the avoidable
damage costs (in Table 7.4) less the damage costs avoided under the option/baseline from
the total; and
impact on avoidable damage costs – which is simply the damage costs avoided under the
option/baseline expressed as a percentage of the total avoidable damage costs (in Table
7.4).
8.1.2 Costs and benefits
Benefit:cost ratios provide an indication of the performance of an option in economic terms. Where
the ratio is greater than one the benefits (in terms of damage costs avoided) outweigh the financial
costs (meaning that the action is justified in economic terms). The larger the benefit:cost ratio, the
more justifiable the option is in economic terms.
As noted in Section 7, benefits are expressed in terms of damage costs avoided, are calculated on
the basis of the avoidance of one incidence of ‘disease’ per year per substance identified with a
human health classification and improvement in 1km of waterbody for every substance identified
with a classification for aquatic toxicity43. When compared with recent information on the costs and
benefits of environmental regulation (Defra 201544) these are likely to be underestimated (rather
than overestimated).
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Table 8.1: Summary table of the PV Costs and Benefits of the Options and Impact on Avoidable Damage Costs
Changes brought about under different options for information
requirements
Current Annex III
Current
Ann. VII
Current
Ann. VII
Removal of the
diffuse/dispersive
use criterion in
Annex III
Ann. VII+
Information
Ann. VII++
Information
Current
Ann. VII
Removal of
Annex III
Ann. VII+
Information
There are no changes to the information
in Annex VII and Annex III remains the
same
There are no changes in the information
required in Annex VII but changes to
Annex III act to increase the number of
substances required to submit full tox
and ecotox information
There are slight increases in the tox and
ecotox information in Annex VII and
changes to Annex III act to increase the
number of substances required to
submit that tox and ecotox information
There are more significant increases in
the tox and ecotox information in Annex
VII and changes to Annex III act to
increase the number of substances
required to submit that tox and ecotox
information
There are no changes in the information
required in Annex VII but removing
Annex III means that all substances are
required to submit full tox and ecotox
information
There are slight increases in the tox and
ecotox information in Annex VII but
removing Annex III means that all
substances are required to submit full
tox and ecotox information.
Cost
(€m)
Benefit
(€m)
B/C
ratio
Rank B/C
ratio
Residual
damages
(€m)
Percentage of
total damage
costs avoided
Rank Impact
on damage
costs
€ 525.2
€ 5,263
10.02
1
€ 11,962
31%
6
€ 693.8
€ 6,312
9.10
4
€ 10,913
37%
5
€ 713.8
€ 6,673
9.35
3
€ 10,552
39%
4
€ 1,236.3
€ 11,685
9.45
2
€ 5,540
68%
1
€ 977.4
€ 8,559
8.76
6
€ 8,666
50%
3
€ 1,012.8
€ 9,041
8.93
5
€ 8,184
52%
2
REACH 1- 10 tonnes Phase 2
RPA & CSES | 102
Throughout the whole estimation of costs and benefits, the same data and assumptions have
applied equally across all of the options and the baseline. As such, whilst the damage costs and
damage costs avoided may in fact be higher, changes to assumptions and data will affect each of the
options equally in terms of benefits and costs. Thus, whilst benefit:cost ratios for each option would
be different with different assumptions for the number of health/environment cases avoided, the
relative performance of each option is unlikely to change significantly (i.e. any changes would affect
the benefit:cost ratios equally).
Examination of the benefit:cost ratios provided in Table 8.1 leads to a number of observations:

despite the large variation in the magnitude of costs, the benefit:cost ratios suggest that all
options are justified in economic terms – in other words, for all options the value of the
benefits (expressed in €s) significantly exceeds the costs;

the current requirements perform very slightly better than the other options, providing (at
least) €10.02 of benefits for every €1.00 of cost. However, this is only €0.57 more than the
benefits from the next best performing option in economic terms (the increased Annex VII+
information combined with removal of the diffuse/dispersive use criterion in Annex III);

the ‘worst’ performing options include those where the current Annex VII requirements are
retained. Again, however, these perform only slightly worse than the baseline; and

the variation between benefit:cost ratios is relatively very small. As such no option performs
significantly better or significantly worse than another option (including the baseline).
On the basis of these observations, no firm conclusions can be drawn concerning the ‘best’ option
in economic terms. In short, within the scope of the options considered, an increase in cost
provides a roughly proportionate increase in benefit in terms of damage costs avoided. There is no
significant difference between the options in terms of benefit:cost ratios (particularly considering
the uncertainties inherent in the estimation of both costs and benefits).
8.1.3 Impact on damage costs
Whilst comparison of benefit:cost ratios does not reveal any clear differences between the options
or the baseline, comparison of the PV damage costs avoided for each option with the total PV
avoidable damage costs (€17,225 million) reveals significant differences between the options. As
might be expected from the observation that benefits are directly proportional to cost, the more
expensive options perform significantly better than the cheaper options (the cheapest being the
baseline).
Thus, if economic performance (in terms of benefits versus costs) and impact on damage costs were
the only factors to consider in selecting the appropriate option, the rank order of preference would
be that dictated by the level of impact on the total damage costs in Table 8.2.
REACH 1- 10 tonnes Phase 2
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8.2: Impact of options on total avoidable damage costs
Rank
Option
Annex VII++ - No Diffuse/
Dispersive Use Criterion in Annex III
Annex VII+ - No Annex III
1
2
3
Annex VII - No Annex III
Annex VII+ - No Diffuse/ Dispersive
Use Criterion in Annex III
Annex VII - No Diffuse/ Dispersive
Use Criterion in Annex III
Baseline
4
5
6
Cost (€m
PV)
Damage
Costs
Avoided
(€m PV)
Impact on
avoidable damage
costs (% of total
damage costs
avoided)
Residual
damages (€m
PV)
€ 1,236.3
€ 11,685.0
68%
€ 5,540.0
€ 1,012.8
€ 9,040.8
52%
€ 8,184.2
€ 977.4
€ 8,558.6
50%
€ 8,666.3
€ 713.8
€ 6,673.1
39%
€ 10,551.8
€ 693.8
€ 6,312.2
37%
€ 10,912.8
€ 525.2
€ 5,262.7
31%
€ 11,962.2
8.1.4 Impacts on competition and innovation
Impact on damage costs is not, however, the only deciding factor when selecting the most
appropriate option in terms of the combination of Annex III requirements and toxicological and
ecotoxicological information for 1-10t substances. Perhaps unfortunately, the decision is more
complicated because which option is ‘best’ depends on:


what level of residual damages are ‘acceptable’?
what level of burden on the chemical industry is sustainable?
Neither of these can be robustly quantified and both, to a greater or lesser extent, will vary
depending on who is asked. Whilst further consideration of these issues can be informed by the
quantitative and qualitative information on business impacts (such as that provided in Section 6), it
is not possible to make any firm conclusions on the acceptability or sustainability of the options.
This means that the study can make no firm conclusions or recommendations on which option is
‘best’ or most appropriate and the final decision on which option should be adopted must be
made by other means (considering the information provided on business impacts).
Section 6 of this report provides a detailed commentary on business impacts of the options including
on innovation and competitiveness. In terms of competitiveness, the general conclusions that can
be drawn are that all the options considered increase registration costs and lead to withdrawal
levels above the baseline position. The impact of higher costs on company competitiveness and
survival will vary significantly depending on the sub-sectors in question. Research carried out for this
project suggested that 1-10t substances would be found in the following sectors: rare earth metals,
dyes, pigments, fragrances, cosmetics, lubricants, surfactants, photonics, electro-optics, and
electronics.
A good many of the higher value substances are imported, and would be able to absorb registration
costs, with concomitant knock-on effects further downstream. Some imports, such as dyes, and
substances manufactured and used in products such as lubricants or surfactants would have
difficulty absorbing registration costs which would mean MIs might be unwilling to register them and
create problems for DUs.
REACH 1- 10 tonnes Phase 2
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As costs of the different options increase, it is also probable that impacts on the competitiveness of
smaller firms will be more negatively affected than larger ones. This is due to the probability that
smaller firms are more dependent on low volume substances than their large counterparts, and also
because they tend to have fewer resources available to adjust to changes in competitiveness
brought about by changes in legislation and especially those leading to higher cost levels.
As regards innovation, the consequences of moving towards higher information and higher cost
options in these low volume substances are somewhat more indeterminate. The extent to which
businesses will invest in various approaches depends on cost/ profits/ risk calculations. These vary
by the innovations in question (e.g. reformulation with an existing substance/ developing a new
substance/ changing the product so that the substance is no longer needed), the size of the market
in question and the value of the relevant substances, and risks, which in the present economic
environment in the EU are quite high and would discourage innovation unless outcomes are quite
high and certain.
Again, higher value added substances would tend to be able to justify more expensive innovation
costs, and larger firms would be more likely to dispose over the required resources if innovation was
the option decided upon.
8.1.5 The missing option
Anticipating that there will be further deliberations within the Commission concerning which option
is most appropriate, it seems inevitable that there will be a question as to the merits of a sixth
option. This would entail maintaining the current Annex III requirements (as in the baseline) but
increasing the toxicological and ecotoxicological information requirements slightly to match those of
the Annex VII+ option.
The specification for this study limited consideration to the five options and the baseline (as
presented throughout the report) and so this option has not been examined in detail. Nonetheless,
it is worth considering what the costs and benefits of the option are likely to be using the
information in Table 8.1 on the costs and benefits of Annex VII versus Annex VII+ options.
Both of the options for changing Annex III requirements have sub-options which involve, on the one
hand, leaving the information requirements as at present (Annex VII) and, on the other, increasing
the information requirements slightly (Annex VII+). There is no difference between the sets of
options in terms of the numbers of substances being required to generate information, only the
level of information that is required to be generated for these substances. As such, any differences
are associated only with the additional cost of generating the additional information and the
additional benefit that this information is likely to bring.
Of the two sets of Annex III options that could be compared, the no diffuse use trigger option bears
bar far the greatest similarity to the baseline47 and so is most suitable for comparison. Comparing
the costs and benefits of these options (in Table 8.1) suggests that extending Annex VII information
47
This set of options only differs from the baseline because the dispersive/diffuse substances identified by
QSARs with a possible classification are included. The no Annex III option requires all substances to
generate information (and no QSAR assessment for Annex III to be undertaken).
REACH 1- 10 tonnes Phase 2
RPA & CSES | 105
requirements to match the Annex VII+ information requirements increases the costs by around 3%
relative to the current information requirements and the benefits by around 6%.
Applying these increases to the baseline (Annex VII) provides the projected costs and benefits of the
missing option (that of retaining Annex III as at present but increasing the information
requirements). The resulting estimated costs and benefits of this option are provided in Table 8.3.
Table 8.3: Estimated PV costs and benefits of increasing only the information requirements
Cost (€m)
Benefit (€m)
Residual
B/C
Impact (% of total
damages
ratio
damage costs
(€m)
avoided)
Current Annex III and Annex VII
information requirements (the
€ 525.20
€ 5,262.7
€ 11,962.2
10.02
31%
baseline)
Current Annex III and extended
Annex VII+ information
€ 540.34
€ 5,563.6
€ 11,661.3
10.30
32%
requirements
Comparison of the benefits and costs of this missing option with the baseline suggest a slightly
higher benefit:cost ratio (10.3) compared with the baseline (10.02) making it the only option likely to
perform better than the baseline in purely economic efficiency terms. However, this is only very
slightly better and, for the reasons already mentioned, the difference between this missing option
and the baseline (or the other options) cannot be considered significant.
Extending the information requirements in Annex VII slightly (to match the Annex VII+ option) but
leaving the Annex III requirements as at present would deliver an estimated minimum additional
benefit of €301 million compared with the baseline. This would cost an additional €15.1 million
across all 20,000 1-10t substances (an increase in costs of around €757 or 3% per substance on
average) compared with the baseline. This is equivalent to an average increase in costs per MI of
€172 per substance. When compared with the baseline (current requirements) the impacts on
innovation and competitiveness of this option are likely to be so small as to be indistinguishable
from the baseline but the benefits may be more significant.
Reproducing and updating Table 8.1, Table 8.4 provides a summary table for all options including the
‘missing’ option.
REACH 1- 10 tonnes Phase 2
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Table 8.4: Summary table of the PV Costs and Benefits of the Options and Impact on Avoidable Damage Costs
Changes brought about under different options for information requirements
Current
III
Annex
Current Ann.
VII
Ann.
VII+
Information*
Current Ann.
VII
Removal of the
diffuse/dispersiv
e use criterion in
Annex III
Ann.
VII+
Information
Ann.
VII++
Information
Current Ann.
VII
Removal
Annex III
of
Ann.
VII+
Information
There are no changes to the information in
Annex VII and Annex III remains the same
There are slight increases in the tox and
ecotox information in Annex VII and no
changes to Annex III
There are no changes in the information
required in Annex VII but changes to Annex
III act to increase the number of substances
required to submit full tox and ecotox
information
There are slight increases in the tox and
ecotox information in Annex VII and changes
to Annex III act to increase the number of
substances required to submit that tox and
ecotox information
There are more significant increases in the
tox and ecotox information in Annex VII and
changes to Annex III act to increase the
number of substances required to submit
that tox and ecotox information
There are no changes in the information
required in Annex VII but removing Annex III
means that all substances are required to
submit full tox and ecotox information
There are slight increases in the tox and
ecotox information in Annex VII but
removing Annex III means that all
substances are required to submit full tox
and ecotox information.
Cost (€m)
Benefit
(€m)
B/C
ratio
Rank B/C
ratio
Residual
damages
(€m)
Percentage of
total damage
costs avoided
Rank Impact
on damage
costs
€ 525.2
€ 5,263
10.02
2
€ 11,962
31%
7
€ 540.3
€ 5,564
10.30
1
€ 11,661
32%
6
€ 693.8
€ 6,312
9.10
5
€ 10,913
37%
5
€ 713.8
€ 6,673
9.35
4
€ 10,552
39%
4
€ 1,236.3
€ 11,685
9.45
3
€ 5,540
68%
1
€ 977.4
€ 8,559
8.76
7
€ 8,666
50%
3
€ 1,012.8
€ 9,041
8.93
6
€ 8,184
52%
2
*Imputed values
REACH 1- 10 tonnes Phase 2
RPA & CSES | 107
REACH 1- 10 tonnes Phase 2
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Annex 1 Defining the Annex VII+ and VII++ Options
A1.1 Overview
The Annex VII+ and VII++ options have been developed by considering the merits of including each
of the following human health and environmental endpoints/sections that currently apply to 10-100t
substances under Annex VIII:


Human Health Endpoints (Toxicology):
o 8.1 Skin irritation /skin corrosion
o 8.2 Eye irritation
o 8.3 Skin sensitisation
o 8.4 Mutagenicity
o 8.5 Acute toxicity
o 8.6 Repeated dose toxicity
o 8.7 Reproductive toxicity
o 8.8 Toxico-kinetics
Environmental Endpoints (Ecotoxicology):
o 9.1 Aquatic toxicity
o 9.2 Degradation
o 9.3. Fate and behaviour in the environment
For each endpoint, the following sections comment on the merits of applying Annex VIII
requirements considering the use/usefulness of the information in the context of the 1-10t
substances.
A1.2 Human Health Endpoints (Mammalian Toxicology)
A1.2.1
Section 8.1 Skin irritation /skin corrosion
Current Requirements and Use of Information
Table A1.1 provides a summary of existing requirements in Annexes VII and VIII and the intended use
of the information generated for the endpoint skin irritation/corrosion.
REACH 1- 10 tonnes Phase 2
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Table A1.1 Section 8.1 Skin irritation /skin corrosion
Annex
Requirements and Adaptations to
Requirements
VII
Following consecutive steps:
(1) an assessment of the available human
and animal data;
(2) an assessment of the acid or alkaline
reserve;
(3) in vitro study for skin corrosion; and
(4) in vitro study for skin irritation
Steps 3 and 4 is not needed where:
1) and 2) indicates classification as
corrosive to the skin or irritating to eyes;
 the substance is flammable in air at
2
room temperature ;
 the substance is classified as very toxic
in contact with skin; or
 an acute toxicity study by the dermal
route does not indicate skin irritation up
to the limit dose level
8.1.1. In vivo skin irritation
8.1.1 not required where:
Use of Information in Relation to Substances
Testing at Each Level
Provides information with respect to the following
classifications:
 Skin corrosive (1A, 1B & 1C)
 Skin irritation (2)
These trigger actions under downstream regulation
in respect of risk/exposure control.

VIII





Provides further information with respect
classification as Skin irritation (2) and, for Annex VIII
substances, provides additional information to CSA.
the substance is classified as corrosive
to the skin or as a skin irritant;
the substance is a strong acid (pH ≤ 2,0)
or base (pH ≥ 11,5);
the substance is flammable in air at
room temperature2;
the substance is classified as very toxic
in contact with skin; or
an acute toxicity study by the dermal
route does not indicate skin irritation up
to the limit dose level (2 000 mg/kg
body weight)
Comments on the Merits of Extending Requirements for 1-10t Substances
The addition of the Annex VIII in vivo skin irritation endpoint to Annex VII would not result in any
classification not already established by the in vitro studies of Annex VII. As CSA is not relevant to 110t substances the addition of this endpoint is likely to have little or no additional benefit in terms of
risk/exposure and control. As such, this endpoint should not be included in the information options.
Final Options for Increasing Information Requirements
Annex VII+
Maintain as at present
Annex VII++
As Annex VII+
REACH 1- 10 tonnes Phase 2
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A1.2.2
Section 8.2 Eye irritation
Current Requirements and Use of Information
Table A1.2 provides a summary of existing requirements in Annexes VII and VIII and the intended use
of the information generated in relation to eye irritation.
Table A1.2: Section 8.2 Eye Irritation
Annex
Requirements and Adaptations to Requirements
VII
Following consecutive steps:
(1) an assessment of the available human and
animal data;
(2) an assessment of the acid or alkaline reserve;
and
(3) in vitro study for eye irritation
Step 3 is not need where:
1) and 2) indicates classification as corrosive to the
skin or irritating to eyes3; or

the substance is flammable in air at room
temperature2
8.2.1. In vivo eye irritation
8.2.1 not required where:
Use of Information in Relation to
Substances Testing at Each Level
Provides information with respect to the
following classification:
 Serious eye damage/irritation (1 &2)
This triggers actions under downstream
regulation in respect of risk/exposure
control.

VIII




the substance is classified as irritating to eyes with
risk of serious damage to eyes;
the substance is classified as corrosive to the skin
and provided that the registrant classified the
substance as eye irritant3;
the substance is a strong acid (pH ≤ 2,0) or base
(pH ≥ 11,5); or
the substance is flammable in air at room
2
temperature
Provides further information with respect
classification
as
Serious
eye
damage/irritation (1 &2) and, for Annex
VIII substances, provides additional
information to CSA.
Comments on the Merits of Extending Requirements for 1-10t Substances
The addition of the Annex VIII in vivo eye irritation endpoint to Annex VII would not result in any
classification not already established by the in vitro studies of Annex VII. As CSA is not relevant to 110t substances the addition of this endpoint is likely to have little or no additional benefit in terms of
risk/exposure and control. As such, this endpoint should not be included in the information options.
Final Options for Increasing Information Requirements
Annex VII+
Maintain as at present
Annex VII++
As Annex VII+
REACH 1- 10 tonnes Phase 2
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A1.2.3
Section 8.3 Skin sensitisation
Current Requirements and Use of Information
Table A1.3 provides a summary of existing requirements in Annexes VII and VIII and the intended use
of the information generated in relation to skin sensitisation.
Table A1.3: Section 8.3 Skin Sensitisation
Annex
Requirements and Adaptations to
Requirements
VII
Following consecutive steps:
(1) an assessment of the available
human, animal and alternative data;
(2) In vivo testing (The Murine Local
Lymph Node Assay (LLNA) is the firstchoice method for in vivo testing
Step 2 is not needed where:
Use of Information in Relation to Substances
Testing at Each Level
Provides information with respect to the following
classification:
Skin sensitiser (1)
This triggers actions under downstream regulation in
respect of risk/exposure control.
(1) the available information indicates
classification for skin sensitisation or
corrosivity;
 (2) the substance is a strong acid (pH
≤ 2,0) or base (pH ≥ 11,5); or

the substance is flammable in air at
2
room temperature
There is no further testing for this
endpoint in Annex VIII

VIII
Comments on the Merits of Extending Requirements for 1-10t Substances
There are no additional requirements in Annex VIII to extend to Annex VII.
Final Options for Increasing Information Requirements
Annex VII+
Maintain as at present
A1.2.4
Annex VII++
As Annex VII+
Section 8.4 Mutagenicity
Current Requirements and Use of Information
Table A1.4 provides a summary of existing requirements in Annexes VII and VIII and the intended use
of the information generated in relation to mutagenicity.
REACH 1- 10 tonnes Phase 2
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Table A1.4: Section 8.4 Mutagenicity
Annex
Requirements and Adaptations to
Requirements
VII
8.4.1. In vitro gene mutation study in
bacteria
Further testing would be considered
following a positive result
VIII
8.4.2. In vitro cytogenicity study in
mammalian cells or in vitro micronucleus
study
8.4.2 not required where:
adequate data from an in vivo
cytogenicity test are available, or
 the substance is known to be
carcinogenic category 1A or 1B or germ
cell mutagenic category 1A, 1B or 2
8.4.3. In vitro gene mutation study in
mammalian cells
8.4.3 only required following a negative
result in Annex VII (8.4.1.) and Annex VIII
(8.4.2.). Not needed where adequate data
from a reliable in vivo mammalian gene
mutation test are available

VIII
Use of Information in Relation to Substances
Testing at Each Level
A positive result in the GMBact triggers further
studies following ECHA Integrated Testing Strategy
(ITS) working through higher Annexes (including
Annex VIII testing as appropriate). Ultimately this
provides information with respect to classification as
Mutagen 1B/2 which, in turn, triggers actions under
downstream regulation in respect of risk/exposure
control and substitution.
Annex VIII substances must complete a battery of
three mutagenicity tests comprising the GMBact
(Ames) test in Annex VII, the CAbvitro (8.4.2) and the
MNTvitro (8.4.3). Following ECHA Integrated Testing
Strategy (ITS), a positive result in any of the three
tests results in further testing working through
higher Annexes to in vivo tests. Ultimately this
provides information with respect to classification as
CMR 1A/1B/2 which, in turn, triggers actions under
downstream regulation in respect of risk/exposure
control and substitution and also information for the
CSA.
Comments on the Merits of Extending Requirements for 1-10t Substances
Annex VII requirements for the 1-10t substances could, in principle, be adjusted by either
substituting the single test (GMBact) with an alternative single test or by adding one or more tests to
it for a two or three test screening battery. The aim of introducing either of these two changes
would be to increase the sensitivity of the screening tests applied so as to increase the number of
genotoxic substances detected.
There is a considerable volume of complex academic literature on the effectiveness (or otherwise) of
various methods and approaches for the detection of genotoxicity and carcinogenicity and the
usefulness (or otherwise) of different screening tests and alternative approaches. However, Kirkland
et al (2005)48 provide an analysis of the performance of individual tests and batteries of two and
three tests. Drawing from the Kirkland et al (2005) study, Table A1.5 provides data on the sensitivity
and specificity of different tests and testing batteries where sensitivity refers to the correct
48
Kirkland, D., Aardema, M., Henderson, L., Müller, L. (2005): Evaluation of the ability of a battery of three in
vitro genotoxicity tests to discriminate rodent carcinogens and non-carcinogens: I. Sensitivity, specificity
and relative predictivity, Mutation Research - Genetic Toxicology and Environmental Mutagenesis, 584 (12), pp. 1-256.
REACH 1- 10 tonnes Phase 2
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identification of genotoxic substances (i.e. as genotoxic) and specificity refers to the correct
identification of non-genotoxic substances (i.e. as non-genotoxic). As can be seen from the table,
there is some variation between Kirkland et al results for sensitivity and specificity depending on
how equivocal results were considered. Considering the actual treatment of equivocal results under
REACH ECHA’s Guidance on Information Requirements and Chemical Safety Assessment - Chapter
R.7a: Endpoint Specific Guidance identifies that these would require repeat testing until a conclusion
can be made.
There is much that can be interpreted from the data in Table A1.5. However, for the options which
are the main consideration of this study, the following can be observed in relation to the possibilities
of substituting the Annex VII GMBact with an alternative or extending the number of tests in the
form of a two or three test battery:
Introducing a two or three test battery
Substances produced in quantities of >10t per year are subjected to a battery of three tests under
REACH comprising GMBact, CAbvitro and MNTvitro. A positive result in any one test triggers further
mutagenicity studies (culminating in in-vivo testing). Such a three test battery could, in theory, also
be applied to the 1-10t substances or, alternatively a two test battery comprising any two of the
above could be applied.
When screening the options to identify those to be taken forward, the first consideration is the
relative effectiveness of two versus three batteries of tests. The UK Committee on Mutagenicity of
Chemicals in Food, Consumer Products and the Environment (COM) produced Guidance on a
Strategy for Genotoxicity Testing of Chemical Substances 49 in 2011 which reviewed the effectiveness
of testing strategies comparing batteries of two versus three tests using adjusted data based on the
Kirkland et al (2005) study (provided in Table A1.5).
49
the UK Committee on Mutagenicity of Chemicals in Food, Consumer Products and the Environment (COM)
(2011) Guidance on a Strategy for Genotoxicity Testing Of Chemical Substances.
http://www.iacom.org.uk/guidstate/documents/COMGuidanceFINAL.pdf
REACH 1- 10 tonnes Phase 2
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Table A1.5: Sensitivity and Specificity of Different Tests and Testing Batteries (after Kirkland et al 2005)
Test/Testing Sensitivity Specificity
‘False
Decision Rules in
Decision rules in relation
battery
positives’ relation to whether
to whether a substance is
a substance is
considered not genotoxic
considered
(specificity)
genotoxic
(sensitivity)
GMBact
If absence of a negative result counts as positive
60%
74%
26%
(equivocal counts as positive)
If a clear positive result is required (equivocal
59%
77%
23%
result counts as negative)
CAbvitro
If absence of a negative result counts as positive
70%
45%
55%
(equivocal counts as positive)
If a clear positive result is required (equivocal
66%
55%
45%
result counts as negative)
MNTvitro
If absence of a negative result counts as positive
81%
31%
69%
(equivocal counts as positive)
If a clear positive result is required (equivocal
79%
54%
46%
result counts as negative)
GMBact plus
If at least one clear
If two clear negative
94%
12%
88%
MNTvitro
positive result
results required
required
If equivocal in both or in
one and negative in the
94%
32%
68%
other (absence of positive
counts as negative)
If equivocal counts as If equivocal in both or in
positive
one and negative in the
97%
5%
95%
other (absence of negative
counts as positive)
GMBact plus
If at least one clear
If three clear negative
91%
5%
95%
MNTvitro
positive result
results required
plus MLA
required
If equivocal in one or two
and negative in the others
91%
15%
58%
(absence of positive
counts as negative)
If equivocal counts as If equivocal in both or in
positive
one and negative in the
93%
1%
99%
other (absence of negative
counts as positive)
GMBact plus
If at least one clear
If three clear negative
85%
23%
77%
CAbvitro
positive result
results required
plus MLA
required
If equivocal in one or two
and negative in the others
85%
30%
70%
(absence of positive
counts as negative)
If equivocal counts as If equivocal in both or in
positive
one and negative in the
90%
16%
84%
other (absence of negative
counts as positive)
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The UK COM (2011) review concluded that there is no convincing evidence that a three-test battery
identifies more carcinogens/genotoxins than a two-test battery comprising GMBact and MNTvitro
and that there is a significantly greater potential for non-genotoxins/carcinogens to be identified as
potential genotoxins (requiring further data to be generated needlessly).
Although the Kirkland et al (2005) data in Table A1.5 does not provide information on the exact
combination of the three test battery that applies to the >10 substances (and could be considered as
a theoretical option for the 1-10t substances), the conclusion that can be drawn from the available
data is that a two test battery comprising GMBact and MNTvitro is the better option and that there
is no benefit (and potentially significant cost) from extending requirements to a three test battery
(by the addition of CAbvitro). As such, the three test battery should be eliminated from further
consideration.
Substitute GMBact Test
With regard to substituting the current GMBact test with an alternative, there are two choices
available from Annex VIII, namely CAbvitro and MNTvitro. From Table A1.5, both of these tests
would appear to perform slightly better than the GMBact test in terms of the correct identification
of genotoxins (sensitivity) with MNTvitro performing best (MNTvitro correctly identifies around 35%
more genotoxins than GM Bact and CAbVitro 12-17% more than GMBact).
In relation to the correct identification of non-genotoxins (specificity) and false positives, however,
the opposite is true and GMBact performs much better than both of the alternatives and MNTvitro
performs worst (with MNTvitro identifying 46-69% of non-genotoxins as potential genotoxins,
CAbvitro 45-55% compared with only 23-26% for GMBact).
This means that any substitution of the Annex VII GMBact test, whilst it may increase the detection
of genotoxic substances, will also falsely identify a greater and significant proportion of nongenotoxins as potential genotoxins for further testing through Annexes VIII to X (including in vivo
testing). In addition, both of the alternatives are significantly more expensive to undertake than
GMBact with CEFIC (2012) test cost data suggesting the costs of testing are € 3,465 for GMBact, €
20,080 for CAbvitro and € 16,518 for MNTvitro.
Substitute GMBact Test or Extend to Two Test Battery?
In terms of the implications of substituting the current GMBact in Annex VII with either CAbvitro or
MNTvitro or with a two test battery comprising GMBact plus MNTvitro, Table A1.6 provides
illustrative estimates of the changes in total costs of mutagenicity testing under Annex VII and the
numbers of genotoxins and non-genotoxins identified for further testing. The illustration is
calculated on the basis of every 10,000 substances submitting full Annex VII information and
assumes that 1.85%50 of these (185) would be identifiable as genotoxic in vivo if they were subjected
to such tests (and therefore 96.5% as not genotoxic in vivo). The numbers are not intended to
provide an actual estimate of the costs of the options but, rather, the means to compare the options
on a like for like basis to enable the identification of the best candidates for further consideration.
50
1.85% of substances on the CLI have a classification for mutagenicity.
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Table A1.6: Illustrative Estimates of Changes Costs of Mutagenicity Testing under Annex VII and Numbers
of Genotoxins and Non-genotoxins Identified for Further Testing
GMBact +
GMBact CAbvitro MNTvitro
MNTvitro
Illustrative number undergoing full testing in Annex VII:
10,000
10,000
10,000
10,000

Of which assumed genotoxic in vivo
185
185
185
185
9,815
9,815
9,815
9,815

Of which non-genotoxic in vivo
51
Cost of each test
€ 3,465 € 20,080
€ 16,518
€ 19,983
Total Cost of Annex VII Testing (assuming no existing
€ 34.6
€ 200.8
€ 165.2
€ 199.8
test information and all require a test) (Million €)
Number Requiring Further mutagenicity studies:
2,515
5,033
5,792
8,388
110
126
148
176

Of which assumed genotoxic in vivo

Of which non-genotoxic in vivo
2,405
4,908
5,644
8,212
Regarding the substitution of the GMBact test with an alternative test, the data in Table A1.6
suggest that either choice of alternative test is associated with a substantial increase in costs for
generating Annex VII information and a substantial increase in the number of non-genotoxic
substances required to generate additional mutagenicity data (culminating in in vivo testing). This is
accompanied by a slight to moderate increase in the number of genotoxic substances that might be
identified.
In relation to an extension to a two test battery, this is also associated with a substantial increase in
costs for Annex VII and an even larger increase in the numbers of non-genotoxic substances required
to generate additional information on mutagenicity. However, compared with options for
substituting the GMBact test with an alternative test, the increase in numbers of genotoxic
substances identified is more significant.
Maintaining the current situation (where the GMBact is the only mutagenicity test in Annex VII),
appears likely to be the most appropriate option in terms of the balance between identification of
genotoxic substances, the total costs of testing for mutagenicity in Annex VII and minimising the
extent to which non-genotoxic substances are falsely identified as potentially genotoxic and are
required to perform further mutagenicity testing (including in vivo) at significant additional cost.
Neither of the extension options (substitution of GMBact or use of a two test battery) would appear
to offer the same balance. However, in the interests of providing a thorough comparison, it is
considered worth including one of these options as part of the higher Annex VII++ option for
extending information requirements. Of the options available the two test battery should be
considered for the Annex VII++ option given the substantial increase in the detection of genotoxic
substances.
Final Options for Increasing Information Requirements
Annex VII+
Maintain current approach (GMBact)
51
Annex VII++
Extend to a two test battery (GMBact plus MNTvitro)
Costs have been drawn from the 2012 CEFIC testing catalogue which lists the average cost of testing for each
endpoint.
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A1.2.5
Section 8.5 Acute toxicity
Current Requirements and Use of Information
Table A1.7 provides a summary of existing requirements in Annexes VII and VIII and the intended use
of the information generated in relation to acute toxicity.
Table A1.7: Section 8.5 Acute Toxicity
Annex
Requirements and Adaptations
Requirements
VII
8.5.1. By oral route
Not required where:
to
the substance is classified as corrosive
to the skin; or
 a study on acute toxicity by the
inhalation route (8.5.2) is available
(requirement for 10 to 100 tonne
substances)
8.5.2. By inhalation
8.5.2. only required where exposure of
humans via inhalation is likely taking into
account the vapour pressure of the
substance and/or the possibility of
exposure to aerosols, particles or droplets
of an inhalable size
8.5.3. By dermal route
8.5.3 only required where:
 inhalation of the substance is unlikely;
 skin contact in production and/or use is
likely; and
 the physicochemical and toxicological
properties suggest potential for a
significant rate of absorption through
the skin
Use of Information in Relation to Substances
Testing at Each Level
Provides information with respect to the following
classification:
• Acute oral toxicity (1-4) & STOT SE (1-3)

VIII
VIII
This triggers actions under downstream regulation
in respect of risk/exposure control.
Provides additional classifications in relation to
Acute inhalation/dermal toxicity (1-4) & STOT SE
(1-3)
Provides additional information to CSA on NOAELs
and routes of exposure/safe concentrations and
risk reduction.
Comments on the Merits of Extending Requirements for 1-10t Substances
The addition of inhalation/dermal toxicity endpoints to Annex VII would enable the identification of
additional classifications for 1-10t substances that would not otherwise be available and may be
important from the perspective of managing risks in the workplace. However, relative to oral
toxicity testing, the cost of any additional testing is relatively high (around €12,300 for inhalation and
€2,500 for dermal compared with around €1,500 for oral based on CEFIC testing cost estimates). As
such, the addition of (particularly inhalation) needs to be carefully considered from a cost and
benefit point of view.
Here, were a 1-10t substance to be identified with a new classification for acute oral toxicity (as per
Annex VII) this change in classification would already trigger downstream regulation in respect of
worker health and safety and product safety. This in turn would require consideration of exposure
and safe use of the substance by manufactures and downstream users. As such, the identification of
additional toxicity classifications in relation to inhalation and/or dermal toxicity would not, in itself,
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trigger any additional regulation (as this has already been triggered by the oral toxicity
classification). It would, however, have an impact on the measures put in place to reduce worker
exposure as such there is some merit in considering the addition of these endpoints to the
information requirements for 1-10t substances.
Analysis of the CLI in Table A1.8 suggests that around 91-96% of substances classified for acute oral
toxicity also have a classification for dermal and/or inhalation. Similarly, 4-9% of substances
classified for dermal and/or inhalation toxicity do not have a classification for oral toxicity. This,
then, would tend to suggest that classification for oral toxicity could be used as a trigger for further
studies on inhalation or dermal toxicity (depending on the routes of likely exposure). Such an
approach may capture 91-96% of the substances that are toxic via dermal or inhalation routes but
eliminate a substantial amount of testing on substances that are non-toxic.
Table A1.8: Analysis of substances classified for toxicity via oral, inhalation or dermal routes.
Classification combinations
Number classified based Number classified
on Harmonised
based on all
Classifications only
substances classified
on CLI
Toxicity classifications from CLI
Oral (H300-303)
1,602
44,532
Oral (H300-303) or Dermal (H310-313)
1,635
45,027
Oral (H300-303) or Inhalation (H330-333)
1,750
46,001
Oral (H300-303) or Dermal (H310-313) or Inhalation
1,769
46,261
(H330-333)
Dermal (H310-313)
619
15,631
Dermal (H310-313) or Inhalation (H330-333)
1,006
19,442
Inhalation (H330-333)
750
17,490
Inferences
Dermal not oral
33
495
Inhalation not oral
148
1,469
Inhalation or dermal but not oral
167
1,729
inhalation or dermal and oral
1,602
44,532
Percentage of substances classified as acute toxic oral
that also have a classification for dermal and/or
91%
96%
inhalation
Percentage of substances with a classification for
9%
4%
dermal and/or inhalation but not oral
However, as the costs of additional testing would still not be insignificant and the additional
information may or may not alter risk management measures applied via parallel regulation this
option should be included for the VIII++ option alone.
Final Options for Increasing Information Requirements
Annex VII+
As at present
Annex VII++
Classification for acute oral toxicity in accordance with Section
8.5.1 of Annex VII triggers consideration of dermal and
inhalation toxicity in accordance with Sections 8.5.2 and 8.5.3 of
Annex VIII.
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A1.2.6
Section 8.6 Repeated Dose Toxicity
Current Requirements and Use of Information
Repeated dose toxicity is not considered in Annex VII. Table A1.9 provides a summary of existing
requirements in Annex VIII and the intended use of the information generated in relation to
repeated dose toxicity.
Table A1.9: Section 8.6 Repeated Dose Toxicity
Annex
Requirements and Adaptations to Requirements
VIII
8.6.1. Short-term repeated dose toxicity study (28 days), one
species, male and female, most appropriate route of
administration, having regard to the likely route of human
exposure.
8.6.1 not required where:
a reliable sub-chronic (90 days) or chronic toxicity study is
available, provided that an appropriate species, dosage,
solvent and route of administration were used;
 a substance undergoes immediate disintegration and there
are sufficient data on the cleavage products; or
 relevant human exposure can be excluded in accordance
with Annex XI Section 3.
Further studies shall be proposed by the registrant or may be
required by ECHA in cases of:





Use of Information in Relation
to Substances Testing at Each
Level
Information on this endpoint
allows classification for single
target organ toxicity - repeated
exposure (STOT RE 1 and 2).
Information is also used in the
CSA and, as part of this, for the
assessment of T in PBT/vPvB
assessment.
failure to identify a NOAEL in the 28 or 90 days study unless
the reason is absence of adverse toxic effects;
toxicity of particular concern (e.g. serious/severe effects);
indications of an effect for which the available evidence is
inadequate for toxicological and/or risk characterisation. In
such cases it may also be more appropriate to perform
specific toxicological studies that are designed to
investigate these effects (e.g. immunotoxicity,
neurotoxicity); or
particular concern regarding exposure (e.g. use in
consumer products leading to exposure levels which are
close to the dose levels at which toxicity to humans may be
expected)
Comments on the Merits of Extending Requirements for 1-10t Substances
Testing for short term repeated dose toxicity in accordance with Section 8.6.1 of Annex VIII is
estimated to cost nearly €78,000 in the CEFIC testing catalogue. This far exceeds the total cost of
testing for all endpoints currently in Annex VII (indeed it is eight times the estimated average total
registration costs for 1-10t substances calculated in Phase 1 - €9,500) . As such, requiring such a test
for all 1-10t substances is likely to hugely increase the costs of registration for manufacturers and
importers of these substances with the effects on competition and innovation likely to be equally
significant.
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Given this, the option of requiring short term repeated dose toxicity testing for all of the 1-10t
substances can be eliminated as it would be impractical to implement. However, if a suitable trigger
could be identified from information gathered in relation to, for example, classification in relation to
acute toxicity or biodegradation, this could be considered in the higher of the two options (Annex
VII++). The most obvious trigger would be classification for acute toxicity 4 in accordance with
Section 8.5.1 of Annex VII.
Final Options for Increasing Information Requirements
Annex VII+
Maintain as at present (no short repeated dose
toxicity testing)
A1.2.7
Annex VII++
Short term repeated dose toxicity in accordance with
Section 8.6.1 of Annex for substances identified with
a classification for acute toxicity 4 in accordance with
Section 8.5.1 of Annex VII.
Section 8.7 Reproductive toxicity
Current Requirements and Use of Information
As with short term repeated dose toxicity, reproductive toxicity is not considered in Annex VII. Table
A1.10 provides a summary of existing requirements in Annex VIII and the intended use of the
information generated in relation to reproductive toxicity.
Table A1.10: Section 8.7 Reproductive Toxicity
Annex
Requirements and Adaptations to Requirements
VIII
8.7.1.Screening for reproductive/ developmental toxicity, one species
(OECD 421 or 422), if there is no evidence from available information
on structurally related substances, from (Q)SAR estimates or from in
vitro methods that the substance may be a developmental toxicant.
Use of Information in
Relation to Substances
Testing at Each Level
Information on this
endpoint
allows
considerations
in
relation
to
classification as toxic
for reproduction.
8.7.1 not required if the substance is:
known to be a genotoxic carcinogen and appropriate risk
management measures are implemented;
known to be a germ cell mutagen and appropriate risk management
measures are implemented;
relevant human exposure can be excluded in accordance with Annex
XI section 3; or
a pre-natal developmental toxicity study (Annex IX, 8.7.2) or a twogeneration reproductive toxicity study (Annex IX, Section 8.7.3) is
available.
If such a conclusion is
reached
the
information is used in
the CSA as part of
assessment
of
potential
exposure
limits
and
recommended
risk
management
measures.
If a substance is known to have an adverse effect on fertility, meeting
the criteria for classification as toxic for reproduction category 1A or
1B: May damage fertility (H360F), and the available data are adequate
to support a robust risk assessment, then no further testing for
fertility will be necessary. However, testing for developmental toxicity
must be considered.
Classification as Toxic
to Reproduction 1A/1B
also triggers parallel
regulation on worker
safety and product
safety.




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If a substance is known to cause developmental toxicity, meeting the
criteria for classification as toxic for reproduction category 1A or 1B:
May damage the unborn child (H360D), and the available data are
adequate to support a robust risk assessment, then no further testing
for developmental toxicity will be necessary. However, testing for
effects on fertility must be considered.
In cases where there are serious concerns about the potential for
adverse effects on fertility or development, either a pre-natal
developmental toxicity study (Annex IX, Section 8.7.2) or a twogeneration reproductive toxicity study (Annex IX, Section 8.7.3) may
be proposed by the registrant instead of the screening study
Comments on the Merits of Extending Requirements for 1-10t Substances
Testing for reproductive toxicity in accordance with Section 8.7.1 of Annex VIII is estimated to cost
€97,000 in the CEFIC testing catalogue. This far exceeds the total cost of testing for all endpoints
currently in Annex VII (indeed it is ten times the estimated average total registration costs for 1-10t
substances calculated in the 2012 Phase 1 study - €9,500).
As no suitable trigger to focus testing on a discrete group of 1-10t substances appears to be
available, if it were applied to the 1-10t substances, reproductive toxicity testing would be required
for all substances (other than those identified as genotoxic). This would hugely increase the costs of
registration for manufacturers and importers of these substances with the effects on competition
and innovation likely to be equally significant.
Given this, the option of requiring reproductive toxicity testing for the 1-10t substances can be
eliminated as it would be impractical to implement.
Final Options for Increasing Information Requirements
Annex VII+
Maintain as at present (no reproductive toxicity testing)
A1.2.8
Annex VII++
As Annex VII+
Section 8.8 Toxico-kinetics
Current Requirements and Use of Information
Toxico-kinetics is not considered in Annex VII. Table A1.11 provides a summary of existing
requirements in Annex VIII and the intended use of the information generated in relation to toxicokinetics.
Table A1.11: Section 8.8 Toxico-kinetics
Annex
Requirements and Adaptations to
Requirements
VIII
8.8.1. Assessment of the toxicokinetic
behaviour of the substance to the extent
that can be derived from the relevant
available information.
Use of Information in Relation to Substances
Testing at Each Level
Information on toxicokinetics is used in exposure
and risk characterisation as part of CSA. It is also
used in the assessment of B in PBT/vPvB.
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Comments on the Merits of Extending Requirements for 1-10t Substances
As noted in the table, for substances subject to Annex VIII (>10t per year) information on toxicokinetic behaviour is used alongside other toxicity information as part of chemical safety assessment
(CSA). As CSA does not apply to 1-10t substances including such studies for all of the 1-10t
substances has questionable benefit even if the estimated cost of the assessment is relatively small
compared with other Annex VIII endpoints (€ 1,278 – CEFIC Testing catalogue).
That said, toxicico-kinetic information is useful in relation to the assessment of B in PBT/vPvB
assessment where screening identifies potential PBT/vPvB properties. However, screening and
assessment of PBT/vPvB properties is not currently required for the 1-10t substances in spite of the
fact that information to inform that screening is already present within Annex VII. This is because all
requirements in relation to PBT/vPvB screening and assessment (as set out in Annex XIII) currently
apply only to those substances required to undertake CSA (i.e. excluding 1-10t substances).
Changing the requirements so that Annex XIII PBT/vPvB screening and assessment also applies to the
1-10t substances is an option that will be considered for both of the extended information options
(Annex VII+ and VII++) for 1-10t substances. As such, gathering information on toxico-kinetics would
be one of the options available to manufacturers and importers in support of any PBT/vPvB
assessment triggered by the outcome of PBT/vPvB screening (which does not require information on
toxico-kinetics). More information on the options in respect of PBT/vPvB screening and assessment
is provided in Section 2.3.2.
Final Options for Increasing Information Requirements
Annex VII+
Assessment of the toxicokinetic behaviour of the substance in
accordance with Section 8.8.1 may be carried out where a new
requirement to screen for PBT/vPvB properties identifies a
substance as a potential PBT/vPvB and this will be useful to
assessment.
Annex VII++
As Annex VII+
A1.3 Environmental Endpoints (Ecotoxicology)
A1.3.1
Section 9.1 Aquatic toxicity
Current Requirements and Use of Information
Table A1.12 provides a summary of existing requirements in Annexes VII and VIII and the intended
use of the information generated in relation to aquatic toxicity.
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Table A1.12: Section 9.1 Aquatic Toxicity
Anne Requirements and Adaptations to Requirements
x
VII
9.1.1. Short-term toxicity testing on invertebrates (preferred species
Daphnia)
9.1.1. Not required where:



VII
VIII
there are mitigating factors indicating that aquatic toxicity is unlikely to
occur, e.g. substance is highly insoluble in water or the substance is
unlikely to cross biological membranes;
a long-term aquatic toxicity study on invertebrates is available; or
adequate information for environmental classification and labelling is
available.
Long-term toxicity testing may be considered instead of 9.1.1. The longterm aquatic toxicity study on Daphnia (Annex IX, section 9.1.5) is
considered if the substance is poorly water soluble
9.1.2. Growth inhibition study aquatic plants (algae preferred)
9.1.2. Not required where there are mitigating factors indicating that
aquatic toxicity is unlikely to occur e.g. substance is highly insoluble in
water or the substance is unlikely to cross biological membranes
9.1.3. Short-term toxicity testing on fish (or long term study, if preferred)
9.1.3. Not required where:
 there are mitigating factors indicating that aquatic toxicity is unlikely to
occur; or
 a long-term aquatic toxicity study on fish is available.
Long-term aquatic toxicity testing as described in Annex IX shall be
considered if the CSA indicates the need to investigate further effects on
aquatic organisms. The choice of the appropriate test(s) will depend on the
results of the CSA.
The long-term aquatic toxicity study on fish (9.1.6) shall be considered if
the substance is poorly water soluble
Use of Information in Relation to Substances Testing at Each Level
In combination with one another, test endpoints in Annex VII provide
information with respect to the following classifications:


Hazardous to the aquatic environment (acute 1 & chronic 1-4); and
Hazardous to the aquatic environment acute (1).
Serious eye
damage/irritation (1 &2)
Unlike the human health endpoints, no specific requirements under parallel
regulation are triggered by such a classification unless specifically identified
by the regulator.
Changes in classification results in alterations to general guidance on safe use
in safety data sheets (SDS) in relation to the environment.
In combination with one another, test endpoints in Annex VIII provides
further information with respect to the following classification:

Hazardous to the aquatic environment acute (1)
In addition, in combination with information from the Annex VII endpoints,
information is used to derive Predicted No Effect Concentrations (PNECs)
that are used in exposure assessment and risk characterisation for the
environmental compartment and for assessment of T in PBT/vPvB
assessment in CSA.
The CSA enables the identification of appropriate recommended risk
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VIII
9.1.4. Activated sludge respiration inhibition testing
9.1.4. Not required where:
 no emission to a sewage treatment plant; or
 there are mitigating factors indicating that microbial toxicity is unlikely to
occur;
 the substance is found to be readily biodegradable and the applied test
concentrations are in the range of concentrations that can be expected in
the influent of a sewage treatment plant.
9.1.4. may be replaced by a nitrification inhibition test if available data
show that the substance is likely to be an inhibitor of microbial growth or
function, in particular nitrifying bacteria
management measures that must be applied by manufacturers and
downstream users.
PNECs may also potentially be used by the regulator in relation to the need
for wider controls under, for example, Article 16 of the Water Framework
Directive or the setting of environmental quality standards (EQS) and
drinking water limits.
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Comments on the Merits of Extending Requirements for 1-10t Substances
Adding a third test in the form of short-term toxicity testing on fish (9.1.3) to the requirements for 110t substances is unlikely to lead to the identification of any additional classifications (as these
classifications should be already be established by testing in Annex VII). The main purpose of the
test(s) in Annex VIII is to identify a PNEC for the purpose of CSA which, as noted earlier, is not
required for the 1-10t substances.
On first inspection, then, as there is no CSA for 1-10t substances, there would appear to be little
benefit in extending the information requirements by adding a short-term toxicity test on fish as a
third aquatic toxicity test. However, even in the absence of CSA, there are benefits from deriving
PNECs for substances classified as hazardous to the aquatic environment. Here, unlike the human
health endpoints discussed in Section 2.2, changes in classification in relation to aquatic toxicity do
not automatically trigger action to assess and limit exposure under parallel regulation. Rather, it is
up to the regulator to propose that action is required under that regulation and what the
Environmental Quality Standard (EQS) should be.
For example, the main provision of the Water Framework Directive 2000/60/EC (WFD) with regard
to hazardous substances is Article 16. Together with the daughter Directive 2008/105/EC on
Environmental Quality Standards in the Field of Water Policy (EQS Directive), Article 16 of the WFD
provides for the establishment of a list of priority substances, which present a significant risk to or
via the aquatic environment, identified on the basis of risk assessment. For the identification of
priority substances, the WFD demands data specifically on the aquatic toxicity of substances and, for
this, information that would lead to the derivation of a PNEC would be useful.
As such, there is some merit to adding testing in accordance with Section 9.1.3 - short-term toxicity
testing on fish to the requirements for 1-10t substances that are identified as hazardous to the
aquatic environment by the current set of tests in Annex VII or which have been identified by
screening as potential PBTs/vPvBs (see section 2.3.2 below).
Final Options for Increasing Information Requirements
Annex VII+
Annex VII++
Testing in accordance with Section 9.1.3 - short-term toxicity
testing on fish would be undertaken:
As Annex VII+
for any substances identified with a classification as hazardous to
the aquatic environment by testing in accordance with Section
9.1 of Annex VII; and
for any substances where screening for P and B in PBT/vPvB
identifies that criteria for both P and B (or vP and vB) are met.
A1.3.2
Section 9.2 Degradation
Current Requirements and Use of Information
Table A1.13 provides a summary of existing requirements in Annexes VII and VIII and the intended
use of the information generated in relation to degradation.
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Table A1.13: Section 9.2 Degradation
Annex
VII
VIII
Requirements and Adaptations to
Requirements
9.2.1
Biotic
9.2.1.1.
Ready
biodegradability
Not required for inorganic substances
9.2.2 Abiotic: 9.2.2.1. Hydrolysis as a
function of pH
9.2.2.1 Not required where the substance
is:
Use of Information in Relation to Substances
Testing at Each Level
Information on this endpoint does not lead to any
classification. In principle the information could be
used to inform screening for P in PBT/vPvB
assessment but such screening is not required for
the 1-10t substances (as screening and assessment
in accordance with Annex XIII only applies at
present to substances performing a CSA).
Information also informs PBT/vPvB screening in
accordance with Annex XIII of REACH as part of
CSA.
readily biodegradable; or
highly insoluble in water
Further degradation testing to be
considered if the CSA indicates the need
to investigate further. The choice of the
appropriate test(s) will depend on the
results of the CSA


Comments on the Merits of Extending Requirements for 1-10t Substances
As noted in Table A1.13, information gathered in accordance with Section 9.2.1 (ready
biodegradability) of Annex VII is, at present, underutilised. No classification or other trigger for
action in relation to risk management results from gathering the information.
As noted in Section 2.2.8 above, the option to change REACH requirements such that Annex XIII
PBT/vPvB screening and assessment also applies to the 1-10t substances is an option that will be
considered for both of the extended information options (Annex VII+ and VII++) for 1-10t
substances.
Under both of the extended options, then, the following will apply:

information from the ready biodegradability test in Annex VII will be used to inform screening of
P in PBT/vPvB;

information on the octanol-water partitioning coefficient experimentally determined in
accordance with Section 7.8 of Annex VII will be used to screen for B in PBT/vPvB;

if the above screening for P and B identifies that a substance may meet the criteria for both P
and B (or vP and vB), information will be gathered in relation to Section 9.1.3 of Annex VIII,
short-term toxicity testing on fish (if it has not already been gathered as part of the option). This
will be used to screen for T in PBT;

if the above screening identifies the substance as a potential PBT or vPvB, any additional
information to make an assessment will be gathered in accordance with Annex XIII of REACH.
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In terms of adding the abiotic test for biodegradability from Annex VIII section 9.2.2, a review of the
criteria in Annex XIII suggests that this test is not required for screening and is not sufficient for
assessment. As such, this test will not be included in either of the extended information options (as
it appears to be surplus to requirements in relation to PBT/vPvB screening).
Final Options for Increasing Information Requirements




Annex VII+
information from the ready biodegradability test in Annex VII
will be used to inform screening of P in PBT/vPvB;
information on the octanol-water partitioning coefficient
experimentally determined in accordance with Section 7.8 of
Annex VII will be used to screen for B in PBT/vPvB;
if the above screening for P and B identifies that a substance
may meet the criteria for both P and B (or vP and vB),
information will be gathered in relation to Section 9.1.3 of
Annex VIII, short-term toxicity testing on fish (if it has not
already been gathered as part of the option). This will be used
to screen for T in PBT;
if the above screening identifies the substance as a potential
PBT or vPvB, any additional information to make an
assessment will be gathered in accordance with Annex XIII of
REACH.
A1.3.3
Annex VII++
As Annex VII+
Section 9.3 Fate and behaviour in the environment
Current Requirements and Use of Information
Studies on fate and behaviour in the environment do not form a part of considerations in Annex VII.
Table A1.14 provides a summary of existing requirements in Annex VIII and the intended use of the
information generated in relation to fate and behaviour in the environment.
Table A1.14: Section 9.3. Fate and behaviour in the environment
Annex
Requirements and Adaptations to Use of Information in Relation to Substances
Requirements
Testing at Each Level
VIII
9.3.1. Adsorption/desorption screening
Information informs consideration of
9.3.1. Not required where:
environmental exposure assessment and risk
characterisation as part of CSA.
 a low potential for adsorption is
expected based on the physicochemical
properties (e.g. from octanol-water
partition coefficient); or
 the substance and its relevant
degradation products decompose
rapidly
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Comments on the Merits of Extending Requirements for 1-10t Substances
As information on fate and behaviour in the environment is present in Annex VIII only to inform
environmental exposure assessment and risk characterisation as part of CSA it has little relevance in
the context of the 1-10t substances. As such this endpoint will not be added to either of the
extended information options.
Final Options for Increasing Information Requirements
Annex VII+
Maintain as at present (i.e. not required)
Annex VII++
As Annex VII+
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Annex 2 Detailed Description of the Monte Carlo Modelling
A2.1 Overview
An Excel® based Monte Carlo simulation model has been developed to analyse and explore the
options and the baseline (current requirements). The Monte Carlo simulation approach has been
applied to allow the full range and spread of costs to be examined rather than a simple average
(which provides little information of use to exploring business impacts). Here, the costs of
registering any given substance depend on a number of factors including (but not limited to):








Whether there is already toxicological or ecotoxicological information on that substance or
whether there is some or none;
Whether that substance is identified by QSARs or other evidence as meeting one or more of
the criteria in Annex III (or variants of in the options) and, hence, must generate the
toxicological and ecotoxicological information in Annex VII (or variants of in the options);
The properties of that substance. For example, whether the substance is a CMR/non-CMR,
is acutely toxic, etc. (where this determines what further testing may be required under the
options);
The outcome of screening tests and, in particular, those for mutagenicity (where a positive
result will require that further testing is undertaken);
The number of companies registering that substance (which influences both the sharing of
information costs in a SIEF and also the cost of administering a SIEF);
Whether the registrants of that substance will all support a joint registration or whether one
or more individual registrations will be submitted also;
The size of the companies registering that substance (which determines the registration fees
due and also allows exploration of the impacts on SMEs versus larger companies); and
The volumes produced by each of the companies registering that substance (which has an
influence on the impact of the costs on companies and downstream users because it
provides an indication of the price increase per unit of manufacture).
Clearly, different permutations of the above have different results in terms of the cost of registering
different substances. In addition, the number of possible permutations is very large (a few thousand
possibilities). Some permutations will result in relatively large costs of registration and some
relatively low costs. The Monte Carlo simulation model explores the different permutations,
calculating and recording the costs associated with each. The probability of each permutation is
governed by the individual probability of each factor. In the Monte Carlo simulation these
probabilities have been derived by consideration of statistical data and, where not available,
assumptions.
When it is run, the Monte Carlo simulation model generates a series of ‘virtual registrations’ for
substances. For each ‘virtual registration’, the model generates a permutation (using the
probabilities mentioned above) and calculates the resulting cost for each of the registrants under
each of the options (and the baseline). The model repeats this 20,000 times (once for every 1-10t
substance expected to be registered) in each case recording the identity of the substance (as a
numbered code), the identity of the registrants (as a numbered code) and the cost of registration for
each of those registrants. In this way the model produces nearly 88,600 rows of data, each row
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giving the costs of registering a substance for an individual company under each of the options (and
the baseline). These data have then been aggregated by company and also by substance.
For the benefit of transparency, all of the assumptions and numbers underlying the modelling and
probabilities for the Monte Carlo simulation are described in detail in the following:

number and nature of substances: estimation of the number and nature of hazardous
properties within the population of 1-10t substances;

number of substances requiring toxicological and ecotoxicological information: estimation
of the number of substances that will be identified by QSARs and other evidence as priority
substances and will be required to generate toxicological and ecotoxicological information;

substance costs of testing and information: estimation of the cost of generating the
necessary toxicological and ecotoxicological information for substances;

substance registration costs: estimation of the costs of registration including dossier
preparation, sharing of information, administration costs of joint registrations, fees, etc.

aggregation of costs:
manufacturer/importer.
calculation
of
overall
costs
by
substance
and
by
A2.2 Number and Nature of Substances
A2.2.1
Total number of 1-10t substances
Substances to be registered only in the 1-10t band
It is estimated by ECHA that full registration for 20,000 unique phase-in substances will be submitted
in the 1-10t band alone in/by the 2018 deadline. These are substances yet to be registered that will
not also be registered in higher tonnage bands. In addition, 46 unique substances have already been
fully registered in the 1-10t band only owing to their known C, M or R 1A/1B properties and the
requirements to register these earlier (under Article 23(1)(a) of REACH).
Substances also registered in higher tonnage bands
Substances also registered in higher tonnage bands are less significant for the analysis as
information equivalent to Annex VIII and above is already required for ALL of these substances. For
these substances information leading to classifications including and going beyond those achieved
under any of the information options being analysed will already be available and communicated to
downstream users via Safety Data Sheets – (SDS and extended Safety Date Sheets – eSDS). As such,
there is no effect or benefit from applying the options to these substances (as information in excess
of that required under the options is already required and classifications communicated to
downstream users and distributors).
A2.2.2
Properties of the 1-10t Phase-in Substances
Until (and unless) testing and other information is gathered for the 20,000 1-10t substances there
will be no information that describes exactly what number of substances possess hazardous
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properties and what these hazardous properties are. For this analysis, then, one must first predict
what the properties of these substances are. This then provides the basis for identifying which of
these substances and properties are already known (by existing test information, QSARs or other
information) and the extent to which each option (and the baseline) is likely to detect further
hazardous substances and properties.
This is achieved in the model by dividing the 20,000 1-10t substances into those which, if subjected
to toxicological and ecotoxicological testing, would be identified with properties that would meet:




At least one human health and at least one environmental classification (hereafter referred
to as HH and ENV);
At least one human health classification but no environmental classifications (HH not ENV);
At least one environmental classification but no human health classifications (ENV not HH);
No human health or environmental classifications;
Determining the percentage of substances fitting each of these categories has been informed by
considering data from ECHA which provides an indication of the number of substances which have
no hazardous properties and, for those which are likely to have hazardous properties, examining
data in the classification and labelling inventory (CLI) to determine the types of hazardous
properties.
Here, the figures Table A2.1 provide a breakdown of substances by type (or absence) of hazardous
property given by an examination of the substances on the CLI. For the 1-10t substances estimated
to have one or more hazardous properties, this provides an indication of the likely split between
those with properties that would meet human health, environmental or both types of classification.
Table A2.1: Numbers of 1-10 t substances with different classification (based on CLI52 )
Source of
Type of classification
Numbers of substances with
As a percentage of all
information
matching properties
substances on CLI
Data from CLI
HH
98,516 (A)
ENV
33,999 (B)
HH and ENV
24,599 (C)
21%
Total of all substances on CLI
117,945 (D)
Numbers
HH not ENV
73,917 (E = A minus C)
63%
derived from
ENV not HH
9,400 (F= B minus C)
8%
the above
Total with ENV or HH
107,916 (G = C plus E plus F)
No ENV or HH Properties (i.e.
10,029 (D minus G)
9%
those on the CLI with physical
hazard classifications or no
classifications at all)
It should be noted that, owing to the fact that the database may contain multiple self-classifications
for a number of substances, the CLI is not ideal for the purpose of predicting the likely hazardous
properties of the 1-10t substances. However, the only alternative approach is to use entries for
harmonised classifications on the CLI alone (to eliminate the influence of multiple classifications for
the same substance). However, the list of substances for which a harmonised classification has been
determined is relatively short (4,509 substances) compared with that of the full CLI (117,917) and
harmonisation has been prioritised towards those substances with the most hazardous properties.
52
As of September 2014
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RPA & CSES | 133
Thus, use of harmonised classifications alone for predicting the properties of the 1-10t substances is
likely to exaggerate the number and nature of the hazardous properties. For these reasons, though
still not perfect, data from the full CLI has been used for prediction of properties of the 1-10t
substances53.
Regarding the predicted number of 1-10t substances without any HH or ENV classification, because
it is an inventory of classified substances, the CLI is only really useful for determining the distribution
of substances between those with ENV versus HH versus both types of properties. ECHA have
supplied the study54 with information on the percentage of REACH registrations which have any HH
or ENV classification. This query suggests that 73% of these substances have one or more HH or ENV
classifications. This, in turn, suggests that 27% of the 1-10t substances have no properties that
would lead to classification.
Combining these datasets by applying the percentages in Table A2.1 (i.e. distribution of
classifications in the CLI) to the 73% of substances expected to have HH, ENV or both properties
(14,600 substances in total) provides the percentages and division of the 20,000 1-10t substances in
Table A2.2.
Table A2.2: Predicted numbers of 1-10t substances with hazardous/non-hazardous properties
Properties
Percentage of substances
Numbers of
substances
Substances with HH and ENV properties
17%
3,400
Substances with HH not ENV properties
50%
10,000
Substances with ENV not HH properties
6%
1,200
Total with ENV or HH properties
73%
14,600
No HH or ENV properties for classification
27%
5,400
Total
20,000
A2.2.3
Hazardous properties of the 1-10t substances
The next step in the modelling is to statistically describe the classifications associated with the
estimated 14,600 substances with properties that would meet HH or ENV classifications. Here the
analysis has been restricted to those classifications that are possible according to the tests and test
endpoints that are currently in Annex and also the options for extended information (Options VII+
and VII++) as set out in Table 3.1. This is because it would not be possible to draw conclusions in
relation to other classifications by applying the options (and hence this information is not required
for the analysis and overcomplicates matters).
Table A2.3 provides the classifications, the number of substances on the CLI with those
classifications, the same expressed as a percentage of all substances on the CLI with ENV or HH
classifications and the implied number of 1-10t substances that have properties that would meet the
53
Note: The original analyses undertaken for the BIA were based on a 2005 ECB spreadsheet on the number
of substances with certain R-phrases in the New Chemicals Database (NCD). We have attempted to cross
check estimates with those from the ECB analysis of the NCD but it is not possible to extract this
information from the data presented in 2005.
54
ECHA pers comm October 2014
REACH 1- 10 tonnes Phase 2
RPA & CSES | 134
classifications. Note that not all of the latter will actually have a classification at this point in time
and the number that are currently classified or where properties are suspected depends on the
number of substances with existing test information or information from QSARs. This is the subject
of the next section (Section A2.3).
Table A2.3: Numbers of 1-10t substances with properties that would meet certain classifications
Classification
Number of
As a Percentage of
Implied numbers of 1substances with
substances on CLI
10t Substances with
classification in CLI
with ENV and/or HH properties that would
classification
meet classification if
subjected to testing
Human Health Classifications
Skin corrosive (1A, 1B & 1C)
9,146
8%
1,168
Skin irritation (2)
57,265
53%
7,738
Serious eye damage/irritation (1
69,636
65%
9,490
&2)
Skin sensitisation (1)
11,559
11%
1,606
Acute oral toxicity (1-4 - Hazard
44,439
41%
5,986
classes H300 to H303)
Single target organ toxicity repeated exposure (STOT RE 1
4,289
4%
532
and 2)
Environmental Classifications
Hazardous to the aquatic
44% (of substances
14,835
2,044
environment acute (1)
with ENV)
Totals
Total with ENV (from Tables 4.1
33,999
4,600
and 4.2)
Total with HH and/or ENV (from
107,916
14,600
Tables 4.1 and 4.2)
In addition to the classifications in Table A2.3, CMR 1A/1B and PBT/vPvB properties are of interest
for the analysis (where the latter properties are not included in the CLI).
In relation to CMRs 1A/1B the analysis provided in the Final Report of Chemical Safety Assessment
for 1-10t CMRs 1A/1B (RPA & CSES, 2014) estimated that there are 370 1-10t phase in substances
that are (as yet unknown and unclassified) CMRs 1A/1B.
In relation to PBTs, the work of Strempel et al (2012)55 and others suggests that 2% of substances
would be identified as potential PBTs by screening. ECB (2002)56 suggests that around 20% of the
substances identified as potential PBTs by screening would be identified as PBT substances after full
PBT assessment. Based on this it can be predicted that 2% of the 14,600 1-10t substances predicted
to have a HH and/or ENV classification would be identified by screening as potential PBTs, i.e. 292
substances. Of these, 20% (58) would be identified as actual PBTs by further assessment.
55
Strempel et al (2012): Screening for PBT Chemicals among the “Existing” and “New” Chemicals of the EU,
Environ. Sci. Technol. 2012, 46, 5680−5687.
56
ECB (2002): Identification of Potential PBTs or vPvBs Among the IUCLID High Production Volume Chemicals
(ECB 4/14/02 (PBT strategy – report).
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Having predicted the numbers of substances that would have properties that would meet certain
classifications across the 14,600 1-10t substances predicted to have HH and/or ENV properties, it is
possible to distribute these classifications between the numbers and types of substances derived
and provided in Table A2.2, namely:



Substances with HH and ENV properties (3,400);
Substances with HH not ENV properties (10,000); and
Substances with ENV not HH properties (1,200).
This provides the values in Table A2.4 describing (statistically) the number of different types of
classifications for these substances. So, for example, the data in the table suggest that 10,000 1-10t
substances will have HH properties that would meet one or more classifications. Of these, 872 will
be skin corrosive (1A, 1B & 1C), 276 will be CMR 1A/1B, etc.
Table A2.4: Hazardous Properties of 1-10t Substances
Numbers
Numbers
with HH and with HH NOT
ENV
ENV
All substances with any HH
or ENV
Skin corrosive (1A, 1B & 1C)
Skin irritation (2)
Serious eye
damage/irritation (1 &2)
Skin sensitisation (1)
CMR 1A/1B (Mut 1B)
Acute oral toxicity (1-4)
Single target organ toxicity repeated exposure (STOT RE
1 and 2)
Numbers
with ENV not
HH
Numbers
with no
properties
matching
any HH or
ENV class
Total
1,200
5,400
14,600
Human Health Classifications
296
872
0
1,963
5,775
0
0
0
1,168
7,738
2,408
7,082
0
0
9,490
407
94
1,519
1,199
276
4,467
0
0
0
0
0
0
1,606
370
5,986
135
397
0
0
532
3,400
10,000
Environmental Classifications
Hazardous to the aquatic
environment acute (1)
Would screen as PBT
Actual PBT (after post
screening assessment)
1,496
0
528
0
2,024
68
14
Other Properties
200
40
24
5
0
0
292
58
A2.3 Number of Substances Requiring
Ecotoxicological Information
A2.3.1
Toxicological
and
Introduction
The data provided in Table A2.4 (above) describe the predicted hazardous properties of 1-10t
substances. All of these substances and properties would be identified by applying all tests
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(including in vivo testing for mutagenicity) to all substances. As such, these data represent the
starting point for examining the extent to which the different information options are able to
identify these properties (and the costs and benefits of doing so). Here, none of the options under
examination involve in vivo mutagenicity testing, only options cover all of the substances and some
options include additional tests. Options vary in terms of:


The test endpoints included and the screening/testing strategies applied to substances
required to gather toxicological and ecotoxicological information (information options VII,
VII+ and VII++); and
The number of substances actually required to generate toxicological and ecotoxicological
information (the Annex III options).
The first consideration for the Monte Carlo model is the number of substances required to generate
toxicological and ecotoxicological information under the options. Under the current requirements
only “priority substances between 1 and 10 tonnes” were intended to require generation of
toxicological and ecotoxicological information. These substances are defined by a combination of
Article 12 and Annex III and are “substances for which it is predicted (i.e. by the application of
(Q)SARs or other evidence) that they are likely to meet the criteria for”:


classification as C, M or R 1A/1B or PBT/vPvB; or
any health or environmental hazard classes or differentiations under CLP and have a
dispersive or diffuse use.
The options under consideration are to:



Do nothing- the baseline;
Remove the diffuse/dispersive use criterion; or
Remove all criteria in Annex III – i.e. require all 1-10t substances to provide toxicological and
ecotoxicological information.
The starting point for modelling of the baseline and certain options is the estimation of the numbers
of “substances for which it is predicted (i.e. by the application of (Q)SARs or other evidence) that they
are likely to meet the criteria for classification”. The model considers ‘evidence’ in the following
order:

Step 1: Existing test information – some substances will already have some test results on
some endpoints. The model estimates this number and therein the numbers of substances
likely to be identified as being likely to meet criteria for CMR 1A/1B and PBT/vPvB based on
this existing information. The numbers that are not identified as such are then considered
in Steps 2 and 3;

Step 2: Application of Read Across (RA) - RA is a technique used to predict endpoint
information for one substance by using data for the same endpoint from another substance
which is considered to be similar in some way (on the basis of structural similarity and
similar properties and/or activities). The model estimates the number of substances for
which information from RA might be applied. It then estimates the number of substances
likely to be identified as likely CMRs 1A/1B, PBTs/vPvBs or other HH or ENV classifications;
and
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
Step 3: Application of (Quantitative) Structure Activity Relationships ((Q)SARs) - A SAR is a
qualitative relationship that relates a (sub)structure to the presence or absence of a
property or activity of interest. A QSAR is a mathematical model (often a statistical
correlation) relating one or more quantitative parameters derived from a chemical structure
to a quantitative measure of a property or activity. The model estimates the number of
substances for which information may be derived from (Q)SARs and, therein, the number of
substances likely to be identified as likely CMRs 1A/1B, PBTs/vPvBs or other HH or ENV
classifications.
The outcome of applying these steps is predictions of:



The number of substances for which hazardous properties are already known from test
information;
The number of substances for which hazardous properties are suspected from the
application of QSARs or other information (or would be if QSARs were applied); and,
therefore
The number of substances required to generate toxicological and ecotoxicological
information under the options.
These steps are described in more detail in the following subsections.
A2.3.2
Step 1: Existing Testing Information
For some 1-10t phase-in substances there will already be some data available on some endpoints.
The model differentiates between substances with:



Test information on all current Annex VII endpoints;
Test information on some (simple) toxicological endpoints in Annex VII. Here the model
assumes availability of information on skin/eye corrosion and irritation and acute toxicity
(oral) on the basis that these are the most fundamental and relatively inexpensive tests to
have performed;
No test information.
Concerning the numbers of substances with full test information, RPAs 2006 Revised BIA drew
numbers from the 2006 ECB assumptions on the percentage of substances with a complete data set.
These, in turn, were mainly drawn from the original Business Impact Assessment of the White Paper
(which also drew on data from an ECB and a Danish Study). All of these studies assumed that 17% of
1-10t substances have a complete set of Annex VII data (and others have none).
In the 2012 Phase 1 analysis, these figures were altered in analogy to data on actual percentages of
the higher tonnage substances having data. The following was assumed:



20% of the 1 to 10 tonne substances have data on all Annex VII endpoints;
10% of the 1 to 10 tonne substances have data on some endpoints;
the remainder (70%) have no data on human health and environmental endpoints.
Drawing on and combining these, the Monte Carlo model assumes the values in Table A2.5 where
these represent a fusion between the values applied in the above mentioned BIA (17% with full
Annex VII information) and the assumptions applied in the 2012 Phase 1 study (that 70% of
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substances have no information). This leads to the assumption that 13% of substances have some
information.
Table A2.5: Testing information already available
Substances with test information on all current Annex VII endpoints
Substances with test information on skin/eye corrosion and irritation and acute
toxicity (oral)
Substances with no test information
Percentage of 110t substances
17%
13%
70%
Applying these percentages to the estimates of the number of substances with different properties
(HH and or ENV and none from Table A2.2) provides the breakdown of the numbers of substances
with different levels of existing test information by type of hazardous property in Table A2.6.
The values highlighted in red in Table A2.6 are substances for which existing test information
suggests they are likely to meet the criteria for classification for one or more human health or
environmental endpoints. These substances are potentially captured by the Annex III criteria on the
basis of existing test information alone. The other values relate to substances for which there is, at
present, no test information but for properties might be identifiable by the application of Read
Across (RA) or QSARs. This is considered in the next section (Section 4.3.3).
Table A2.6: Numbers of substances with different levels of information by type of hazardous property
With test information
With test information
Without test
on all Annex VII
on skin and eye
Information
endpoints
corrosion irritation and
acute oral toxicity only
Numbers with HH and ENV
578
442
2,380
Numbers with HH not ENV
1,700
1,300
7,000
Numbers with ENV not HH
204
156
840
Numbers with no properties
918
702
3,780
matching any HH or ENV class
Total numbers of substances
where existing test
2,482
1,742
0
information suggests may
meet a classification for HH
Substances with test information on all Annex VII Endpoints that are Prioritised as CMR 1A/1B or
PBT/vPvB
As noted previously, Annex III criteria prioritise CMRs 1A/1B and PBTs/vPvBs. For substances with
test information on all Annex VII endpoints there will be test information from in vitro gene
mutation studies (GM Bact) and also sufficient information to allow screening for PBT/vPvB. To
determine the numbers likely to be identified as priority 1-10t substances based on existing test
information, the model first considers substances that may be identified as CMR 1A/1B. It then
considers the remaining substances and the number of these that may be identified as PBT/vPvB.
Regarding CMRs 1A/1B, in vitro studies are not perfect predictors of in vivo mutagenicity and may,
on the one hand, fail to identify mutagenic properties of a substance that is actually mutagenic and,
REACH 1- 10 tonnes Phase 2
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on the other, falsely predict that a substance is mutagenic when the subsequent in vivo testing
triggered by such ‘false positive’ indication will identify that it is not. The extent to which in vitro
tests are able to correctly identify in vivo mutagens versus in vivo non-mutagens is expressed in
terms of the sensitivity and the specificity of the test where here:

sensitivity expresses the extent to which a given in vitro test is able to correctly predict that
a substance is mutagenic (expressed as the percentage of in vivo mutagens that would be
correctly identified); and

specificity expresses the extent to which a given test is able to correctly predict that a
substance is not mutagenic (expressed as the percentage of in vivo non-mutagens that
would be correctly identified).
For those substances identified as likely to meet CMR 1A/1B from the existing test information (GM
Bact), then, there will be two types:


True positives - actual CMRs 1A/1B that presented (true) positive in the GM Bact test already
conducted; and
False postives – non-CMRs 1A/1B that presented (false) positive in the GM Bact test already
conducted.
The model applies a GMBact sensitivity value of 52% and a specificity value of 72%57 to the predicted
numbers of actual CMRs and non-CMRs to identify the numbers of substances that would be
identified as likely CMRs 1A/1B (whether true positive or false positive) and those that would not
(whether false negatives or true negatives). The number of predicted CMRs is derived by
consideration of the total number of substances and properties (given in Table A2.4) and the fraction
of those for which full information will be available (17%). Table A2.7 summarises the data.
57
Based on 3711 chemicals including tests with Salmonella and Escherichia – see Matthews et al., 2006.
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Table A2.7: Substances identified as likely to meet CMR 1A/1B from Existing test information
Total with
No. Actual
True positive False
test
CMRs
results
negative
information
(identified as results (not
on all Annex
likely CMR)
identified as
VII endpoints
CMR)
Numbers with HH and ENV
578
16
8
8
Numbers with HH not ENV
1,700
47
24
23
Numbers with ENV not HH
204
0
0
0
Numbers with no properties
918
0
0
0
matching any HH or ENV class
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No. of nonCMRs
False positive
results
(identified as
likely CMR)
True negative
results (not
identified as
CMR)
Total
identified as
likely CMRs
1A/1B
562
1,653
204
159
467
56
403
1,186
148
167
491
56
918
252
666
252
For the identification of PBTs/vPvB for the purposes of the Annex III criteria, to eliminate double
counting, the model considers substances not already prioritised on the basis of their being likely to
meet classifications as CMR 1A/1B (as estimated above). The Monte Carlo model applies the
estimated percentage of substances likely to be identified as potential PBT/vPvB by screening (2% as described in Section A2.2.3).
For substances with existing test information on all Annex VII endpoints, Table A2.8 summarises the
numbers of substances prioritised as CMR, PBT/vPvB and also those substances any other HH or ENV
properties (some or all of which will also be considered as priority 1-10t substances depending on
the option and whether they have dispersive or diffuse uses).
Table A2.8: Numbers of substances prioritised on the basis of existing test information on all Annex VII
endpoints
Total with
Of which
Total not
Of which
Total
Total
test
identified as identified as No.
identified as identified as
information likely CMRs likely CMRs screening likely to be
likely to meet
on all Annex (true and
positive
CMR 1A/1B other HH or
VII
false
for PBT
or PBT/vPvB ENV
endpoints
positives)
Classification
Numbers with
578
167
411
8
175
403
HH and ENV
Numbers with
1,700
491
1,209
24
515
1,185
HH not ENV
Numbers with
204
56
148
3
59
145
ENV not HH
Numbers with
no properties
918
252
666
0
252
0
matching any
HH or ENV class
Substances with test information on some Annex VII Endpoints
As noted above, for those substances with some simple toxicological information (but not all of
those in Annex VII) the model assumes that data are available on skin and eye corrosion/irritation
and acute oral toxicity only. These data alone are insufficient to make conclusions regarding
potential CMR 1A/1B and PBT/vPvB properties and so all of these substances are assumed to be
subjected to Steps 2 and 3 (RA and QSARs) in relation to identification of substances likely to these
endpoints and other missing elements.
A2.3.3
Steps 2 and 3: Application of Read Across (RA) and QSARs
For the remaining substances (those with little or no information from testing58) information is
assumed to be sought from the application of QSARs and other information such as Read Across (RA)
as per Annex III.
58
The 70% with no information from testing and those of the 13% where there is some testing information but
none of that information suggests a classification.
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Annex III, however, does not specify in detail what is required in relation to these and other tools.
Elsewhere in REACH conditions on the applicability and use of (Q)SARs are rigidly defined. Here,
Annexes VI to XI of REACH make reference to the use of information from (Q)SARs as an alternative
to testing for specific HH and ENV endpoints for the purpose of classification and labelling and/or
risk assessment. All of these references identify that “(Q)SAR models in accordance with Section 1.3
of Annex XI” are applicable. In turn, Annex XI defines the following conditions under which the use
of (Q)SAR models is acceptable:




“results are derived from a (Q)SAR model whose scientific validity has been established;
the substance falls within the applicability domain of the (Q)SAR model;
results are adequate for the purpose of classification and labelling and/or risk assessment;
and
adequate and reliable documentation of the applied method is provided”.
There is no reference to such conditions in Annex III and, as such, the above conditions (from Annex
XI 1.3) would not seem to apply. Equally, however, REACH does not specify what conditions do
apply to QSARs and other evidence. Furthermore, Annex III does not specify to what lengths
manufacturers and importers and others must go to attempt to make predictions based on QSARs
(or other information including RA) or what happens when no predictions can be made and/or there
is no other evidence available.
This issue was highlighted early in the study’s timeframe and both the Commission and ECHA have
agreed that the requirements of Annex III probably need to be specified in more detail to ensure
that the prioritisation process achieves what is intended (to the extent possible given the technical
limitations of the tools available). The Commission and ECHA agreed to provide guidance to 1 - 10 t
registrants on this issue in 2015.
For the purposes of this analysis (and the Monte Carlo model), based on a review of the work
undertaken in 2006 by RPA for DG Enterprise59 and also in view of the current wording of Annex III,
the following interpretation has been applied:

59
60
Screening Tools are used (without expert judgement): Annex III is applied based on existing
data and QSAR-screening and similar ‘quick scans’ without the use of expert judgement60.
There are many freely available tools that might be used for this purpose with the main tools
currently available being the Analog Identification Methodology (AIM), Danish (Q)SAR
database, Toxmatch, and the OECD QSAR Toolbox. Manufacturers and importers would
As part of the Technical Assistance for REACH Impact Assessment Updates focussing on the then (2005)
Common Position Text and also the Recommendation for the Second Reading (Sacconi, (2006 : ***II
Recommendation for Second Reading, Session document of the European Parliament, Final A6-0352/2006,
dated 13.10.2006).
The alternative would be robust QSARs of the sort described in Annex XI 1.3. Such QSARs would be
expensive to apply owing, in part, to the need for expert judgement. According to ECHA representatives
(pers comm, 2014) this makes such QSARs potentially as costly or more costly to apply than undertaking
the equivalent in vitro test. This would not be consistent with the objective of Article 12 and Annex III to
reduce the burden on low volume substance manufacturers. However, without expert judgement there is
significant risk that the screening will not return reliable results.
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obtain one or more such tools and apply them in-house or commission a QSAR consultancy
to obtain results from similar/the same QSAR tools;

A positive decision rule applies: to be identified as a priority 1-10t substance, there must be
positive evidence of hazardous properties; and

Absence of evidence equates to absence of effects: By extension of the above, the absence
of evidence is taken as absence of effects61. This includes cases/substances where there is no
existing test information and no prediction by QSARs (or other approaches) can be made (for
example, because a substance is out of the ‘domain’ of a QSAR model). The latter
substances would not be 1-10t priority substances (and no new toxicological or
ecotoxicological information would be generated under REACH).
Step 2: Application of Read Across (RA)
RA is a technique used to predict endpoint information for one substance by using data from the
same endpoint from another substance which is considered to be similar in some way (on the basis
of structural similarity and similar properties and/or activities).
RA may be qualitative or quantitative. In qualitative read-across, the presence (or absence) of a
property/activity for the target substance is inferred from the presence (or absence) of the same
property/activity for one or more source substances. Qualitative read-across gives a ‘yes/no’
answer. Quantitative read-across is used to obtain a quantitative value for an endpoint, such as a
dose-response relationship.
RA is based on (and dependent upon) the identification of similar substances and it can be
performed to determine whether the target substance belongs to an existing category (chemical
category) or to identify a similar substance to the target substance (analogue search). Reviewing
available information, the 2012 Phase 1 study on 1-10t substances made tentative conclusions on
the ability of RA to provide information on a range of test endpoints. This review suggested that RA
might be applied to around 11% of substances.
Accordingly, the Monte Carlo model assumes that similar substances from which RA can be
performed will be identifiable for 11% of the 1-10t substances. In other words, RA can be
successfully applied (and likely properties and HH and ENV classifications can be predicted) for 11%
of substances which currently have little or no information. The resulting numbers of substances
and hazardous properties identified are summarised in Table A2.9.
In the table, the number of substances identified with ‘other HH or ENV classifications’ are derived
by deducting the numbers of likely CMRs and PBTs/vPvBs identified. However, because the values
calculated are statistical, substances identified as potentially CMR 1A/1B and identified as
potentially PBT/vPvB may be:
61
The absence of evidence of effects is not generally otherwise accepted as evidence of absence of effects.
See
for
example
Danish
experience
on
regulatory
use
of
QSARs
https://echa.europa.eu/documents/10162/13639/qsarws_wedebye_tule_en.pdf
REACH 1- 10 tonnes Phase 2
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a. the same substances - in which case the number of substances identified would be
equal to the maximum number identified across the two endpoints. For example, if
10 CMRs and 4 PBTs/vPvBs are predicted by RA then this would equate to 10
substances in total for prioritisation; or
b. the substances may all be different - in which case the number of substances
identified would be equal to the total of the numbers identified across the two
endpoints. So, 10 CMRs and 4 PBTs/vPvBs predicted by RA would equate to 14
substances in total for prioritisation; or
c. most likely, some are the same and some are different - in which case the number
for prioritisation lies between the two cases above. A best estimate is that the
number prioritised is equal to an average of the maximum value across the
endpoints and the total across all endpoints. So, 10 CMRs and 4 PBTs/vPvBs
predicted by RA would equate to 12 substances in total for prioritisation.
The latter approach has been applied in the model to eliminate double counting to the extent
possible.
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Table A2.9: Priority 1-10t substances identified through Read Across (RA)
Type of substance
Numbers of substances for which
CMRs identified for
RA can be successfully applied
prioritisation
(11%)
Substances with test information on some Annex VII Endpoints
Numbers with HH and ENV
49
1
Numbers with HH not ENV
143
4
Numbers with ENV not HH
17
0
Numbers with no properties
77
0
matching any HH or ENV class
Substances with no information
Numbers with HH and ENV
262
7
Numbers with HH not ENV
770
21
Numbers with ENV not HH
92
0
Numbers with no properties
416
0
matching any HH or ENV class
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Potential PBTs/vPvBs
identified for prioritisation
Total identified as likely to
meet other HH or ENV
Classification
1
3
0
48
138
17
0
0
5
15
2
253
742
90
0
0
Step 3: Application of QSARs
QSARs are assumed to be applied to all substances with little or no information and for which RA
cannot be successfully applied according to the rules and interpretations of Annex III set out at the
beginning of this sub-section.
A detailed review of QSARs and their applicability to (and adequacy for) various information
requirements under REACH was undertaken as part of the Phase 1 study. This concluded that QSARs
for the following endpoints could be applied in relation to Annex III (and others were not applicable
or were not oriented towards the specific classification-based approach that Annex II takes):







Acute toxicity
Skin irritation/corrosion
Eye irritation
Skin sensitisation
Mutagenicity/ carcinogenicity
Aquatic toxicity – short term
PBT & vPvB
In the 2006 study for DG Enterprise and also in the Phase 1 study, two key factors were considered
in relation to the applicability and accuracy of QSAR predictions. These were:


QSAR domain: The domain of applicability specifies a group of molecular structures for
which the model is applicable. For molecule structures outside of this domain the model is
not applicable; and
QSAR Performance: the extent to which the QSAR for a given endpoint is able to correctly
predict outcomes.
In both the 2006 and 2012 studies, the focus of the latter factor (performance) was on the correct
identification/detection of substances with hazardous properties (true positives) as opposed to the
incorrect attribution of hazardous properties to a substance not possessing these properties (false
positives). This is because the emphasis of these studies was on the use of QSARs as an alternative
to in vitro and/or in vivo testing rather than screening.
For this, Phase 2 study, the emphasis of is on the use of QSARs for screening of substances and the
determination of whether they are ‘priority 1-10t substances’. This means that there is a need to
better consider the number of false positives (and false negatives) as well as the true positives (and
true negatives) by breaking ‘performance’ down into its composite factors of sensitivity and
specificity where:

sensitivity expresses the extent to which a given QSAR for an endpoint is able to correctly
identify substances with hazardous properties (for that endpoint) - this is expressed as a
percentage substances correctly identified; and

specificity expresses the extent to which a given QSAR for an endpoint is able to correctly
identify substances without hazardous properties (for that endpoint) - this is expressed as a
percentage substances correctly identified as non-hazardous for that endpoint; and
Where possible, estimates for these percentages are based on consideration of actual data on
typical QSAR performance for different endpoints. Here there are a few studies that compare the
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results from QSARs applied to substances for which test data are available (i.e. properties are
known). Where data for an endpoint are not available from such studies, assumed values have been
used based on the ‘poor, fair, good’ performance indications that were the outcome of the
aforementioned review undertaken for the Phase 1 study.
In terms of QSAR domain, the previous studies also derived ‘poor, fair, good’ descriptions. The
Phase 1 study also considered how this may change over time for different endpoints, summarising
the values used in 2006, the status in 2012 and ‘best hope’ projections for what QSAR domains may
look like in 2018 (the next registration deadline). The 2018 projections, however, were based on the
use of QSARs as an alternative to testing. Application of QSARs to provide screening for Annex III will
take place well before 2018. As such, the Monte Carlo model draws on the domain descriptors for
2012 as these are unlikely to have changed significantly.
As with the previous studies, percentages are attributed to the different descriptors as follows:



‘poor’ domain - 10% of substances are within the domain of the QSAR. The QSAR is not
applicable to the others;
‘fair’ domain - 40%; and
‘good’ domain - 70%.
The values applied in the model as defaults are summarised in Table A2.10 (there is the option to
use alternative entered values in the model).
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Table A2.10: Values for QSAR Domain, Sensitivity and Specificity Applied in the Monte Carlo model
QSAR Domain
Assumed in
Estimated
Predicted
Assumed
Domain as a
the 2006
Situation in
situation in
situation at
percentage of
Study23
2012
2018 (Phase 1
the time
substances
(Phase 1
Study)
when
for which the
Study)
screening for QSAR can be
Annex III will
applied
be
undertaken
(as 2012)
Acute toxicity
FAIR
FAIR
GOOD
FAIR
40%
Skin
irritation/corrosion
Eye irritation
Skin sensitisation
Mutagenicity/
carcinogenicity
Aquatic toxicity – short
term
PBT and vPvB
QSAR
Sensitivity
QSAR
Specificity
80%
45%
GOOD
GOOD
GOOD
GOOD
70%
45%
84%
FAIR
GOOD
FAIR
FAIR
GOOD
GOOD
FAIR
FAIR
40%
40%
45%
50%
84%
50%
GOOD
GOOD
GOOD
GOOD
70%
70%
75%
GOOD
FAIR
GOOD
FAIR
40%
70%
70%
Not
considered
FAIR
FAIR
FAIR
40%
70%
60%
Source for
Sensitivity and
specificity
values
Assumed based
on 2012 review
From Liew, C. Y.
and Yap, C. W.
(2013) 62
From UK COM63
Assumed based
on 2012 review
Assumed based
on 2012 review
62
Liew, C. Y. and Yap, C. W. (2013), QSAR and Predictors of Eye and Skin Effects . Mol. Inf., 32: 281–290. doi: 10.1002/minf.201200119
63
UK Committee on Mutagenicity of Chemicals in Food, Consumer Products and the Environment (COM) (2011) Guidance on a Strategy for Genotoxicity Testing of
Chemical Substances. http://www.iacom.org.uk/guidstate/documents/COMGuidanceFINAL.pdf
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Regarding the application of these figures to data on substances and properties, the following
approach is used in the model:

QSARs are applied to the number of substances with HH and/or ENV or no hazardous
properties for which no or only partial test information is available and for which RA does
not apply;

for each QSAR endpoint, the relevant domain percentage is applied to the above numbers to
give the number of substances to which the QSAR is applicable;

for these substances the number exhibiting the different hazardous properties for each
endpoint is ‘known’ statistically (as per Table A2.4). This provides the numbers to which the
sensitivity values are applied which, in turn, provides estimates of the True Positives (TPs)
detected and the False Negatives (FNs) not detected by the application of QSARs;

the same numbers exhibiting the different hazardous properties, when subtracted from the
numbers to which the QSAR is applicable, provides the numbers of substances to which the
QSAR is applicable but there are no hazardous properties. This provides the numbers to
which the specificity values are applied to derive estimates of the True Negatives (TNs) and
False Positives (FPs) for each QSAR;

the TPs and FPs are the substances for which it is predicted by QSARs that substances are
likely to meet the appropriate classification;

The TPs and FPs for mutagenicity and PBT/vPvB are prioritised in the model using the same
approach as that described for RA to aggregate (i.e. the number of substances prioritised is
equal to the average of the total plus the maximum across both endpoints; and

The model employs the same approach when aggregating to the numbers prioritised across
a series of QSAR endpoints.
In this way the Monte Carlo model provides estimates of the numbers of substances for which
QSARs predict that classification may be met where these are divided into those that are predicted
as likely to be:


CMR 1A/1B and/or PBT/vPvB; and
any other HH or ENV classification.
These estimates, when combined with numbers predicted from existing test information and
application of RA, provide the numbers of ‘priority 1-10t substances’ identified according to all
Annex III criteria other than the dispersive/diffuse use criterion which applies to any HH or ENV
classification in the case of the baseline (current) situation.
Previous studies have estimated that between 20% and 40% of substances are used in wide
dispersive uses (20% based on the Danish and Nordic Product Registers and 40% based on the
Commission’s previous estimates). As such, the overall assumption that around 40% of substances
have one or more dispersive/diffuse uses is applied as a default in the Monte Carlo model to derive
the numbers of substances considered as ‘priority 1-10t substances’ under the baseline situation.
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A2.3.4
Predicted Numbers of Substances Requiring Toxicological and
Ecotoxicological Information
Applying all of the modelling steps set out above provides information on the number of substances
likely to be required to generate toxicological and ecotoxicological information under each of the
options and the baseline. Here, options vary between one another and the baseline depending on
the extent to which substances satisfy the criteria in Annex III and, in particular, whether the QSARs
or other information indicates that one or more of the criteria are satisfied. For options involving
the removal of Annex III and it’s criteria, all substances are required to generate toxicological and
ecotoxicological information.
The numbers of substances requiring toxicological and ecotoxicological information under each
option and the baseline are provided in Table A2.11. The substances identified are those that meet
the following criteria in each case:



baseline – substances identified by the application of QSARs or other evidence as likely to
meet classification as CMR1A/1B or PBT/vPvB and substances with diffuse/dispersive uses
likely to meet any other human health or environmental classification;
Annex III no diffuse/dispersive option - substances identified by the application of QSARs or
other evidence as likely to meet classification as CMR1A/1B or PBT/vPvB and all other
substances likely to meet any other human health or environmental classification; and
no Annex III option – all substances required to gather information.
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Table A2.11: Numbers of substances requiring toxicological and ecotoxicological information by application of the Annex III options
No Annex III
No diffuse/dispersive use criterion in
Annex III
Availability
Type of hazardous properties
Number of
CMRs
Potential
Number of
CMRs
Potential
Number of
of existing
(HH – Human Health
Substances
PBTs/
Substances
PBTs/
Substances
test
ENV – Environmental)
to Annex
vPvBs
to Annex
vPvBs
to Annex
information
VII
VII
VII
Test
With HH and ENV properties
578
16
12
578
16
12
336
information With HH (not ENV) properties
1,700
47
34
1,700
47
34
989
available on With ENV (not HH) properties
204
0
4
204
0
4
117
all endpoints Substances with no properties
918
0
0
252
0
0
252
matching any HH or ENV class
Test
With HH and ENV properties
442
12
9
412
12
9
213
information With HH (not ENV) properties
1,300
36
26
1,212
36
26
625
available on With ENV (not HH) properties
156
0
3
67
0
3
47
some
Substances with no properties
702
0
0
163
0
0
128
endpoints
matching any HH or ENV class
No
With HH and ENV properties
2,380
66
47
1,536
42
21
958
information With HH (not ENV) properties
7,000
193
140
4,300
121
61
2,727
available
With ENV (not HH) properties
840
0
17
507
0
8
322
Substances with no properties
3,780
0
0
1,632
0
0
1,231
matching any HH or ENV class
Total
With HH and ENV properties
3,400
94
68
2,526
70
42
1,507
With HH (not ENV) properties
10,000
276
200
7,212
204
121
4,341
With ENV (not HH) properties
1,200
0
24
778
0
15
486
Substances with no properties
5,400
0
0
2,047
0
0
1,611
matching any HH or ENV class
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Baseline
CMRs
Potential
PBTs/
vPvBs
11
33
0
10
28
3
0
0
9
26
0
9
26
3
0
0
38
111
0
19
57
7
0
0
58
170
0
38
111
13
0
0
A2.4 Toxicological and Ecotoxicological Information Gathering
A2.4.1
Standard Information Required under the Options
All substances identified by the model as requiring toxicological and ecotoxicological information
under the relevant Annex III scenario (described above) must gather the information appropriate to
the Information Option (current Annex VII, Annex VII+ or Annex VII++).
Standard information required in Annex VII
The starting point for modelling testing and information costs is the standard information required
in the current Annex VII. This is because this information (and the rules applied to gathering it) is
common to all three of the Information Options.
The current Annex VII information requirements have been summarised in Table 2.3. These provide
standard information that is required to be generated and, in the right hand columns, refinements
and adaptations that apply including the need for further studies in the event of a positive result. In
relation to the latter, only a positive result for Section 8.4 - Mutagenicity triggers further studies.
Further studies under the options are considered in Section 4.4.2.
Whilst information must be provided for all substances, the adaptations and refinements identify
that certain tests are not required in the following cases:



For substances that are strong acids/bases - no test required on 8.1 Skin irritation/skin
corrosion, 8.2 Eye irritation or 8.3 Skin sensitisation;
For substances that are corrosive to skin - no test required on 8.2 Eye irritation or 8.3 Skin
sensitisation; and
For substances that are flammable at room temperature - no test required on 8.1 Skin
irritation/skin corrosion, 8.2 Eye irritation, or 8.3 Skin sensitisation.
In the Monte Carlo model, estimates of the percentage of substances likely to have such properties
are applied to determine which substances do not require test information for the relevant
endpoints. For substances with ENV only or no predicted HH or ENV properties the above
exemptions don’t apply as any of the above exceptions would imply some a property that would
result in a HH classification.
For those substances with HH properties, analysis of CLI suggests that around 20% of substances that
are skin corrosive are strong acids/bases. Expressed as a percentage of substances with any HH
classification this suggests 2.5% of substances with HH properties would satisfy this criteria and no
test would be required.
As regards skin corrosivity, the predicted classifications of substances (summarised in Table A2.4)
suggest that 8.7% of substances with HH properties will be identified as corrosive to skin as so will
not require information on this endpoint. Analysis of CLI suggests that only around 0.2% of
substances would meet the flammability criteria.
Information on all endpoints is assumed to be required for all substances barring the exemptions
identified above. It is assumed that this information is generated by carrying out the relevant in
vitro tests (with the exception of strong acids/bases from which information on corrosivity etc. can
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be easily predicted). With the exception of the mutagenicity screening test (GM Bact – discussed in
Section 4.4.2), it is assumed that each test undertaken positively identifies the corresponding
properties and classification.
Additional standard information required under both Annex VII+ and VII++ Options
The additional information and requirements common to both Annex VII+ and VII++ options
comprise:


Screening and assessment for PBT/vPvB properties; and
Section 9.1 Aquatic Toxicity – a third test is required (on fish).
The additional requirements and the variables applied in Monte Carlo modelling are summarised in
Table A2.12.
Table A2.12: Additional requirements common to the Annex VII+ and VII++ Information Options
Additional
Description
Modelling
Requirement
Screening and
Screening for PBT/vPvB properties in Screening is carried out for all substances requiring
assessment for
accordance with the criteria in toxicological and ecotoxicological information.
PBT/vPvB
Annex XIII is carried out for all Note that where existing test information is
properties
substances.
already available for substances, the screening is
carried out as part of the assessment of whether
If the screening indicates that a the substance is likely to be a PBT/vPvB for the
substance may meet PBT/vPvB purposes of Annex III (where it applies under the
criteria, PBT/vPvB assessment is option combination).
required. This requires the collection
of additional information on the As noted in Section 4.2.4, around 2% of substances
substance, its properties, fate and subjected to screening are expected to be
behaviour in accordance with Annex identified as potential PBT/vPvBs.
These
XIII.
substances are assumed to gather the additional
information for assessment.
Section 9.1
Aquatic Toxicity
Testing in accordance with Section
9.1.3 - short-term toxicity testing on
fish would be undertaken:
 for any substances identified
with
a
classification
as
hazardous to the aquatic
environment by testing in
accordance with Section 9.1 of
Annex VII; and

for
any
substances
where
The assessment based on the additional
information will identify those that are actual
PBTs/vPvBs. As noted in Section 4.2.4, around 20%
of substances identified by screening as potential
PBT/vPvB are actual PBT/vPvB. This percentage is
applied in the Monte Carlo model to provide the
number of PBT/vPvBs identified under each option.
Based on predicted properties of substances in
Table A2.4, 44% of substances with ENV properties
(that undergo testing) will be identified as
hazardous to the aquatic environment (acute) by
testing in accordance with Section 9.1 of Annex VII.
Under the Annex VII+ and VII++ options, these
substances undertake a further aquatic toxicity
study in fish.
The Monte Carlo model assumes that 5% of
substances would be identified as meeting the
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Table A2.12: Additional requirements common to the Annex VII+ and VII++ Information Options
Additional
Description
Modelling
Requirement
screening for P and B in criteria for both P and B (or vP and vB).
PBT/vPvB identifies that criteria
for both P and B (or vP and vB) Under the Annex VII+ and VII++ options, these
are met.
substances undertake a further aquatic toxicity
study in fish (if one is not already required in the
light of the results of aquatic toxicity testing in
accordance with Section 9.1 of Annex VII).
Additional standard information required under the Annex VII++ Option Alone
The additional information and requirements unique to the Annex VII++ option comprises:



Section 8.4 Mutagenicity – additional screening test for cytogenicity;
Section 8.5 Acute Toxicity – dermal or inhalation toxicity studies;
Section 8.6 Repeated Dose Toxicity – for lower toxicity substances
The additional requirements and the variables applied in Monte Carlo modelling are summarised in
Table A2.13.
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Table A2.13: Additional requirements common to the Annex VII+ and VII++ Information Options
Additional
Description
Monte Carlo modelling
Requirement
Section 8.4
In addition to the standard testing in All substances undergo the additional test. It is assumed that 80% undertake the MNTvitro and
Mutagenicity
Annex VII (GM Bact) a further 20% the CABvitro.
screening test is required in the
form of the current Annex VIII A positive result in any of the two tests triggers further studies on mutagenicity (see Section
Section 8.4.2 in vitro cytogenicity 4.4.2)
study in mammalian cells (CAbvitro)
or in vitro micronucleus study
(MNTvitro)
Section 8.5
Classification for acute oral toxicity The data in Table A2.3 suggests that around 41% of substances with HH and/or ENV properties
Acute Toxicity
in accordance with Section 8.5.1 of will be identified for classification as acute toxic (oral). Once classifications have been divided in
Annex VII triggers consideration of the model into substances with HH versus no HH properties this is equivalent to 45% of
dermal or inhalation toxicity in substances with HH properties being classified for acute oral toxicity.
accordance with Sections 8.5.2 and
8.5.3 of Annex VIII.
Under the Annex VII++ option, these substances are required to undertake either a dermal or an
inhalation study depending on the most likely route of exposure. The Monte Carlo model
assumes that 80% of the required testing is on dermal toxicity and 20% on inhalation.
Section 8.6
Repeated Dose
Toxicity
Short term repeated dose toxicity in
accordance with Section 8.6.1 of
Annex VIII for substances identified
by testing under 8.5.1 as Acute Tox
4.
Analysis of toxicity classifications on CLI (see Table A1.8) suggests that 91-96% of substances
that are classified as acute toxic oral also have a classification for toxicity by inhalation or dermal
routes.
As such, the model assumes that 93.5% of the substances subjected to
dermal/inhalation tests (i.e. those identified with a classification for oral toxicity in accordance
with Section 8.5.1 of Annex VII) will be classified accordingly.
27% of substances with harmonised classifications on the CLI are Acute Tox 4. The Monte Carlo
model applies this percentage to the substances for which a classification for oral toxicity has
been identified to provide the numbers undertaking repeated dose toxicity studies. For all of
these substances, improved toxicological information will be available for management of risks.
The Monte Carlo model also assumes that the information will lead to classification as STOT RE 1
or 2 for 17% of the substances tested. This on the basis of the implied number of harmonised
substances with classification as Acute tox 4 and STOT RE 1 and 2.
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Costs applied to the Standard Information Requirements under the Options
The costs applied to the standard information requirements (and further information as required)
under all of the options (including the baseline) are provided in Table A2.14. With the exception of
the following, all costs have been drawn from the 2012 CEFIC testing catalogue which lists the
average cost of testing for each endpoint:



Cost of QSARs for Annex III – the Phase 1 study estimated the costs at around €1,500 per
substance for the QSAR models without expert interpretation. This was based on
discussions with laboratories providing QSAR information but equally could apply to inhouse assessments using QSAR software which might be expected to take around 1.5 days.
The cost is applied in the Monte Carlo model on a per substance basis and applies initially to
all substances for which there is not existing test information on all Annex VII endpoints.
However, it has been tentatively assumed that QSAR/RA has already been applied to 40% of
these substances. As such, no QSAR costs are applied to these substances and any selfclassification possible from QSARs and RA already applied represents existing information
that can only be confirmed by testing. When undertaking new QSAR/RA work for the
purpose of assessing the substance against the criteria in Annex III it is assumed that there is
no duplication of effort between registrants and that a lead registrant takes on the task (but
the cost is shared between the registrants as per the testing costs);
Cost of Screening for PBT/vPvB Properties – PBT/vPvB screening requires cross checking the
results of tests with the screening criteria in Annex XIII. The Monte Carlo model assumes
this would cost around €500 (i.e. a half person day). This applies to Options VII+ and VII++
(because there is no requirement to screen in Annex VII) and also for all substances which
already have information and this information is used as part of the identification of likely
PBT/vPvB properties for the purpose of prioritisation and Annex III (which applies to Annex
VV as well as the higher information options);
Further testing for PBT/vPvB Assessment – further testing and assessment applies to those
substances identified as potential PBT/vPvB by screening. For such substances additional
information comprising simulation testing on degradation in surface water/soil/sediment,
assessment of the toxicokinetic behaviour of the substance or results from a
bioconcentration or bioaccumulation study in aquatic species. The costs of testing and
information may vary considerably. The Monte Carlo model assumes that the cost of further
information is €20,000.
In the Monte Carlo model, the relevant costs have been applied to all substances requiring
information whether or not that information is already available. In the case of substances where
information on some or all endpoints in Annex VII is available, other registrants of the substance will
have to buy access to that information from the owner of that information. The Monte Carlo model
assumes that the owner of that information is one of the registrants and that the current value of
that information is equivalent to the sum of the costs of the relevant tests in the testing catalogue.
In previous studies such costs were not considered as they represent a transfer payment between
companies that make up ‘industry’; thus the net cost of the information is zero viewed across
‘industry’ as a whole. This (new) Monte Carlo model, however, seeks also to examine the impact of
costs on companies. The need to make such transfer payments may be important to those having to
make them (particularly SMEs) and so it is important to reflect them. Costs of existing test
information are still a net zero at an ‘industry’ level because the payment made is credited to
another company.
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Table A2.14: Costs of Testing and Information
Cost component
Cost of QSARs for Annex III
Annex VII 8.1. Skin irritation/ corrosion - In vitro skin corrosion/irritation
Annex VII 8.2. Eye irritation - In vitro eye irritation
Annex VII 8.3. Skin sensitisation - In vivo LLNA
Annex VII 8.4.1 GMbact: gene mutation test in bacteria (Ames test)
Annex VIII 8.4.2 CAbvitro, in vitro chromosome aberration test
Annex VIII 8.4.2 MNTvitro, in vitro micronucleus test
Annex VIII 8.4.2 MNTvitro/CAbvitro (weighted average based on % conducting MNTvitro)
Annex VIII 8.4.3 GMvitro:gene mutation assay in mammalian cells
Annex IX 8.4.4 Cytvivo:cytogenetic assay in experimental animals
Annex VIII 8.4.3 GMvivo:gene mutation assay in experimental animals - Mouse
micronucleus assay
Annex VII 8.5. Acute toxicity - Oral toxicity
Annex VIII 8.5.2. Acute toxicity - Toxicity via Inhalation
Annex VIII 8.5.3. Acute toxicity - Toxicity via Dermal routes
Annex VIII 8.6.1. Repeat dose toxicity - Short term (Oral)
Annex VII 9.1.1. Aquatic Toxicity - Invertebrate - short-term
Annex VII 9.1.2. Aquatic Toxicity - Algal - short-term
Annex VIII 9.1.3. Aquatic Toxicity - Fish – short-term
Annex VII 9.2.1.1. Degradation - Biotic - Ready biodeg
Cost of Screening for PBT/vPvB Properties
Further testing for PBT/vPvB Assessment (once identified by screening)
A2.4.2
Cost (€)
€ 1,500
€ 2,580
€ 1,552
€ 7,117
€ 3,465
€ 20,080
€ 16,518
€ 17,231
€ 17,615
€ 27,730
€ 12,620
€ 1,486
€ 12,267
€ 2,486
€ 52,925
€ 5,232
€ 5,806
€ 4,845
€ 3,705
€ 500
€ 20,000
Information Requirements for Mutagenicity under the Options
Mutagenicity Testing for Annex VII and VII+ Information Options
As noted in Section 4.4.1, all substances completing the full Annex VII requirements are required to
gather data in relation to the Annex VII gene mutation test (GMBact). In the event of a negative
result, it is concluded that the substance is non-genotoxic and no further testing is required. In the
event of a positive result, substances are required to gather additional data from Annex VIII and
above.
The ECHA “Guidance on Information Requirements and Chemical Safety Assessment - Chapter R.7a:
Endpoint Specific Guidance” sets out specific guidance on meeting the information requirements set
out in Annexes VI to XI to the REACH Regulation. The guidance includes, for each endpoint, an
Integrated Testing Strategy (ITS) “providing guidance on how to define and generate relevant
information on substances in order to meet the requirements of REACH64”.
In relation to further studies on mutagenicity, the general route followed by ECHA guidance is one of
undertaking relevant mutagenicity testing progressing up through Annex VIII and above to establish
genotoxicity. The following are required in the event of a positive result for GMBact:
64
Structure of Chapter R.7a – page 15
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

either or both of CAbvitro/MNT Vitro or GMvitro tests in Annex VIII as appropriate to the
ITS;
Cytvivo or GMvivo65 in vivo tests in Annex IX as appropriate to the ITS.
For a substance presenting negative in the in vivo tests it would be concluded that the substance is
not genotoxic and no further testing is required. For a substance presenting positive in either of the
in vivo tests it would be concluded that the substance was genotoxic.
The Monte Carlo model considers substances predicted in the model to have CMR 1A/1B properties
and those that are not (non-CMRs). Sensitivity data for the different tests are applied to the
numbers of CMRs to identify the outcome of each test in terms of the number of true positives (TPs)
and false negatives (FNs) identified. Specificity data are applied to the numbers of non-CMRs to
identify the number of false positives (FPs) and true negatives (TNs).
The sensitivity and specificity data used in the Monte Carlo model are drawn from the UK
Committee on Mutagenicity of Chemicals in Food, Consumer Products and the Environment (COM)
Guidance on a Strategy for Genotoxicity Testing of Chemical Substances66. This guidance reviewed
the effectiveness of testing strategies using adjusted data based on the Kirkland et al (2005)67 study.
The values applied in the Monte Carlo model are provided in Table A2.15.
Table A2.15: Sensitivity and specificity of different in vitro mutagenicity tests
Sensitivity
GMBact
52%
GMvitro
71%
MNTvitro
88%
Cabvitro
55%
MNTvitro/CAbvitro
(weighted average based on 80%
81%
conducting MNTvitro)
Specificity
72%
44%
23%
63%
31%
65
GMbact: gene mutation test in bacteria (Ames test); CAbvitro, in vitro chromosome aberration test;
MNTvitro, in vitro micronucleus test; GMvitro:gene mutation assay in mammalian cells; Cytvivo:cytogenetic
assay in experimental animals; GMvivo:gene mutation assay in experimental animals
66
the UK Committee on Mutagenicity of Chemicals in Food, Consumer Products and the Environment (COM)
(2011) Guidance on a Strategy for Genotoxicity Testing Of Chemical Substances.
http://www.iacom.org.uk/guidstate/documents/COMGuidanceFINAL.pdf
67
Kirkland, D., Aardema, M., Henderson, L., Müller, L. (2005): Evaluation of the ability of a battery of three in
vitro genotoxicity tests to discriminate rodent carcinogens and non-carcinogens: I. Sensitivity, specificity
and relative predictivity, Mutation Research - Genetic Toxicology and Environmental Mutagenesis, 584 (12), pp. 1-256.
REACH 1- 10 tonnes Phase 2
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Considering the standard GMBact test in Annex VII (and VII+), the data suggest that:

52% of CMRs for which toxicological and ecotoxicological information is required will show a
true positive result (TP) triggering the requirement to undertake further studies; and

28% of non-CMRs for which toxicological and ecotoxicological information is required will
show a false positive result (FP) triggering the requirement to undertake further studies.
In terms of the further studies that are required for substances, there are a number of combinations
depending on the results obtained from each successive test suggested by the ITS. The results can
be predicted statistically by applying the relevant sensitivity/specificity value to the outcome of the
previous test. In this way the Monte Carlo model uses a cascade approach to predict how many
substances are likely to carry out which combination of tests (and at what cost).
The approach is illustrated in Figure A2.1 which shows the outcome of applying the ITS to the 52% of
mutagens and 28% of non-mutagens that would be identified as requiring further studies (because
they show a positive result in GMBact). In the figure, the numbers in brackets are the relevant
sensitivity and specificity values assumed for the associated tests (as given in Table A2.14).
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Figure A2.1: Illustration of cascade modelling of the outcome of further mutagenicity following a
positive result for GM Bact in Option VII and VII++
GM bact (Annex VII)
Substances with
positive result in GM
Bact - Further Testing
Required
Mutagens
Non-Mut.
52
28
Negative
MNT/Cabvitro (Annex VIII)
Positive
Negative
Mutagens
Non-Mut.
10
9
( 19% )
( 31% )
GM Vivo (Annex IX/X)
Positive
Mutagens
Non-Mut.
Mutagens
Non-Mut.
42
19
10
0
( 81% )
( 69% )
( 100% )
( 0% )
Mutagens
Non-Mut.
0
9
( 0% )
( 100% )
Negative
Negative
Cytvivo (Annex IX/X)
Positive
Mutagens
Non-Mut.
0
19
( 0% )
( 100% )
GMVivo (Annex IX/X)
Positive
Mutagens
Non-Mut.
Mutagens
Non-Mut.
42
0
0
0
( 100% )
( 0% )
( 100% )
( 0% )
Mutagens
Non-Mut.
0
19
( 0% )
( 100% )
Mutagenicity Testing for Annex VII+ Information Options
As noted in Section 4.4.1, for the Annex VII++ Information Option all substances completing the full
Annex VII requirements are required to gather data in relation to both the Annex VII gene mutation
test (GMBact) and the Annex VIII CAbvitro/MNTvitro studies.
Considering these standard tests application of the sensitivity/specificity data suggest that:

For CMRs - 52% of CMRs for which toxicological and ecotoxicological information is required
will show a true positive result (TP) to the GM Bact and 48% a false negative (FN) result. Of
the 48% showing a false negative, 81% will show a true positive (TP) result in the
CAbvitro/MNTvitro – i.e. 39% overall (81% times 48%). Overall, then, 91% (52% plus 39%) of
CMRs will be identified as requiring further studies by the combination of the two tests;
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
For non-CMRs -28% of non-CMRs for which toxicological and ecotoxicological information is
required will show a false positive result (FP) and 72% a true negative (TN) result. Of the
72% showing a true negative result, 69% will show a false positive (FP) result in the
CAbvitro/MNTvitro – i.e. 49% overall (69% times 78%). As such, 77% of non-CMRs will be
identified as requiring further studies by the combination of the two tests.
As with the further studies required under Annex VII and VII+ options, the Monte Carlo model uses a
cascade approach to predict the test combination that will apply for further studies and the
associated costs.
Substances requiring further mutagenicity studies and associated costs
The outcome of applying the cascade approach to both options is summarised in Table A2.16. This
provides information on all of the possible combinations of standard and further testing under the
Annex VII and VII+ options and also the Annex VII++ option, the percentage of substances
undertaking which combination (divided into those that are CMRs versus those that are not) and the
costs of in vitro and in vivo testing that are applied in the model. Not all combinations are applicable
across all of the options. Here, as described above, Option VII++ requires a second mutagenicity
screening test in the event of a negative result for GMBact where, for Options VII and VII+ a negative
result in GMBact results in a non-genotoxic conclusion (and no further testing is required).
The cost of submitting proposals for in vivo animal tests are considered under substance registration
costs (Section 4.5).
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Table A2.16: Percentage of CMR and non-CMR substances undertaking different combinations of mutagenicity tests and associated costs
All options
In vitro tests
In vivo tests
Information
Options VII
and VII+
Information
Option VII++
Test costs
applied
GM Bact- positive
GM Bact- positive
CAb/MNTvitro –
positive
Cytvivo – negative
GMvivo - either
CAb MNTvitro –
positive
Cytvivo - positive
Test and result combination
Options VII and
VII+ only
GM BactGM Bact- positive
negative
CAb/ MNTvitro –
negative
Conclusion:
Non-genotoxic
GMvivo - either
CMRs through each testing
route (%)
Non-CMRs through each
testing route (%)
CMRs through each testing
route (%)
0.0%
42.3%
9.7%
48.0%
19.3%
0.0%
8.7%
72.0%
0.0%
42.3%
9.7%
Non-CMRs through each
testing route (%)
19.3%
0.0%
8.7%
€ 20,695
€ 40,350
€ 61,045
€ 20,695
€ 27,730
€ 48,425
€ 20,695
€ 12,620
€ 33,315
Cost of In vitro tests
Cost of in vivo tests
Total cost of testing
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Does not apply
to Option VII++
(second
screening test
required)
€ 3,465
None
€ 3,465
Option VII++ only
GM Bact- negative
GM Bact- negative
CAb/ MNTvitro –
positive
CAb/MNTvitro –
negative
Conclusion: Nongenotoxic
Cytvivo - either
Does not apply to Options VII and VII+ (no
second screening test)
39.1%
8.9%
49.7%
22.3%
€ 20,695
€ 27,730
€ 48,425
€ 20,695
None
€ 20,695
A2.5 Substance Registration Costs
A2.5.1
Overview
The cost of generating toxicological and ecotoxicological information (described in Section 4.4)
represent only one element of the costs of registration. To these must be added:






Registration Dossier costs - the costs of drafting and finalising a registration dossier for
submission;
Cost of producing study summaries – which varies from information option to information
option (because of differences in the information generated by different options) and
outcome in terms of any further mutagenicity testing and/or PBT/vPvB assessment;
Joint registration and SIEF administrative costs - where there is more than one registrant of
the substance, the costs of liaising with the other registrants as part of sharing information
on the substance (Substance Information Exchange Fora – SIEFs), sharing the costs of that
information, preparing the registration dossier and other technical and administrative liaison
costs;
Costs of revising Substance Safety Data Sheets (SDSs) – where there is a change in
classification for a substance in the light of any new information generated;
Costs of proposals for animal tests – where there is a need to undertake animal testing by
virtue of following the ITS for mutagenicity or for PBT/vPvB assessment; and
Registration fees – which vary by size of enterprise (micro, small, medium and large).
Owing to the fact that registrations for 1-10t substances are substantially different from the much
larger dossiers that must be produced for higher tonnage substances (which, include, for example,
CSA) there is little or nothing that can be drawn from the experience of registrations submitted for
the higher tonnage substances (>100t per year).
The following sub-sections provide a description of the cost estimation and application of costs in
the Monte Carlo model. With the exception of fees (which are fixed by Regulation), the cost of each
component has been estimated by consideration of likely time and effort for each element. Some of
the cost elements described above will be similar from one substance to another but most will vary
depending on a range of factors including the extent to which further testing has been undertaken
(and must be summarised), the number of other manufacturers and importers (M/Is) and the size of
the M/I enterprise.
A2.5.2
Registration Dossier costs
Registration dossier costs relate to the general compilation of material for the dossier including
physico-chemical information, general administration of the submission and liaison with ECHA. The
costs of providing study summaries in the dossier are considered separately as these vary depending
on the information gathered for a substance.
Two levels of information are relevant for the registrations of 1-10t substances; registrations for
substances needing only to provide physicochemical information and registrations for substances
providing full toxicological and ecotoxicological information.
For both levels, the Monte Carlo model distinguishes between joint registrations (by a consortium of
manufacturers and or importers - M/Is) and individual registrations (by single M/Is). The latter may
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occur either where there is only one M/I of a substance or in situations where one or more members
of a consortium decide to make a separate (individual) submission of their own.
The Monte Carlo model also distinguishes between dossiers compiled and submitted by M/Is of
different sizes, with separate costs applied for micro, small, medium and large enterprises on the
broad assumption that in-house expertise and experience is less developed in smaller companies
and this affects the time taken to compile and submit a dossier (and increases the costs).
The per substance costs of compiling full registration dossiers are provided in Table A2.17 for joint
and individual full registrations. Costs are estimated as a range and reflect person day costs of
€1,000 per day. Registrations containing physico-chemical information only are assumed to be 8090% of the full registration costs in Table A2.17 (as study summaries of toxicological and
ecotoxicological testing information are considered separately). For joint registrations, the Monte
Carlo model applies the cost for the largest size of M/I registering a substance.
Table A2.17: Registration Dossier submission costs (€ per substance)
Lower bound
Cost of Individual Registration dossier for:
Micro enterprises
€ 2,200
Small enterprises
€ 2,000
Medium enterprises
€ 2,000
Large enterprises
€ 1,500
Cost of Joint Registration dossier if:
All members are micro enterprises
€ 2,800
Small is the largest member (no medium or large M/Is)
€ 2,500
Medium is the largest member (no large M/Is)
€ 2,500
Large
€ 2,000
A2.5.3
Upper Bound
€ 3,200
€ 3,000
€ 2,800
€ 2,000
€ 3,800
€ 3,500
€ 3,300
€ 2,500
Cost of producing study summaries
The total cost of producing study summaries for presentation in the dossier depends on the number
and nature of the testing studies undertaken. For the purpose of modelling, these are best
accounted for alongside the costs of testing as an additional cost of summarising the results of the
test. Table A2.18 provides estimated costs of providing study summaries for each of the tests
included in each of the information options. Costs are based on estimated time for a toxicologist
(whether in-house or consultant) at €1,000 per day.
Table A2.18: Cost of summarising information (€ per substance)
Cost of summarising QSARs and other information for Annex III
Annex VII 8.1. Skin irritation/ corrosion - In vitro skin corrosion/irritation
Annex VII 8.2. Eye irritation - In vitro eye irritation
Annex VII 8.3. Skin sensitisation - In vivo LLNA
Annex VII 8.4.1 GMbact: gene mutation test in bacteria (Ames test)
Annex VIII 8.4.2 CAbvitro, in vitro chromosome aberration test
MNTvitro, in vitro micronucleus test
Annex VIII 8.4.3 GMvitro:gene mutation assay in mammalian cells
Annex IX 8.4.4 Cytvivo:cytogenetic assay in experimental animals
Annex VIII 8.4.3 GMvivo:gene mutation assay in experimental animals - Mouse micronucleus assay
Annex VII 8.5. Acute toxicity - Oral toxicity
Annex VIII 8.5.2. Acute toxicity - Toxicity via Inhalation
Annex VIII 8.5.3. Acute toxicity - Toxicity via Dermal routes
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€ 500
€ 100
€ 100
€ 100
€ 250
€ 250
€ 250
€ 500
€ 500
€ 500
€ 100
€ 100
€ 100
Table A2.18: Cost of summarising information (€ per substance)
Annex VIII 8.6.1. Repeat dose toxicity - Short term (1 route only)
Annex VII 9.1.1. Aquatic Toxicity - Invertebrate - short-term
Annex VII 9.1.2. Aquatic Toxicity - Algal - short-term
Annex VIII 9.1.3. Aquatic Toxicity - Fish – short-term
Annex VII 9.2.1.1. Degradation - Biotic - Ready biodeg
Cost of Screening for PBT/vPvB Properties
Further testing for PBT/vPvB Assessment (once identified by screening)
A2.5.4
€ 250
€ 100
€ 100
€ 100
€ 100
€ 250
€ 1,000
Joint registration and SIEF administrative costs
Joint registration and SIEF administrative costs are associated with time spent by each M/I when
engaging with other registrants on shared information (as part of SIEFs) and also on the preparation
of the dossier. Costs applied are as follows:


Cost of engaging on information (applies to each registrant) = € 1,000 per M/I registering;
and
Cost of engaging on dossier preparation (applies to each registrant in a consortium) = € 750
per M/I jointly registering.
For registrations that only include only physico-chemical information, costs are 80-90% of the above.
A2.5.5
Costs of revising Substance Safety Data Sheets (SDSs)
In the event that additional information under REACH results in a change in classification for a
substance, there is a need to update the SDS for the substance. The Monte Carlo model applies a
cost of €500 per substance for updating the SDS.
A2.5.6
Costs of proposals for animal tests
Before animal tests are carried out a proposal for animal testing must be submitted to ECHA. The
Monte Carlo model applies a cost of €500 per proposal per substance.
A2.5.7
Registration fees
Registration fees and charges that apply to different sizes of enterprise are established under
Commission Regulation68. The fees relevant to registration of 1-10t substances are provided as
Table A2.19. Under Article 74(2) of REACH these fees do not apply when full toxicological and
ecotoxicological data are provided.
68
Regulation No 340/2008 of 16 April 2008, as amended by the Commission Implementing Regulation (EU) No
254/2013 of 20 March 2013.
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RPA & CSES | 166
Table A2.19: Registration fees for 1-10t substances (€ per M/I per substance)
Individual
Micro enterprises
€ 86
Small enterprises
€ 600
Medium enterprises
€ 1,114
Large enterprises
€ 1,714
Joint
€ 64
€ 450
€ 835
€ 1,285
A2.6 Aggregation of Costs
A2.6.1
Numbers of M/Is registering 1-10t substances by size of enterprise
When applying and aggregating costs to provide an assessment of costs and cost impact, the Monte
Carlo model must account for variations in costs associated with joint versus individual registrations
and also variations in cost between micro, small, medium and large enterprises. The cost analysis,
therefore, requires information on the registrants of the 1-10t substances and their size.
As registrations for 1-10t substances are yet to be submitted and M/Is are still deciding
what/whether to register which substances and at what tonnage band there is no certain knowledge
on any of the following :



The number of M/Is registering substances;
The size of the M/I enterprises registering the substances (micr0, small, medium and large);
and
The number of substances in the portfolios of companies of different size.
At the time of the first and the revised BIAs for REACH (in 2003 and then in 2006), despite extensive
consultation and review of data there was very little information on the structure of the industry and
manufacturers of the lower tonnage substances in general. The same was found in the Phase 1
study (in 2012). For this Phase 2 study (in 2014), as part of data review and information gathering in
relation to competition and innovation effects, we have undertaken consultation with industry to
identify whether the same knowledge gaps exist and, where they do, whether industry can provide
estimates that would inform the simulation.
In terms of consultation, a structured questionnaire designed to elicit (amongst other things)
quantitative information that could be of use to the simulation. This was circulated by CSES to
organisations considered as likely to be able to provide valuable feedback (mainly industry
associations and also individual companies) and interviews were also undertaken.
Some declined the invitation to participate and all individual companies requested to remain
anonymous but we had interviews or meetings with the following associations:



The Chemical Industries Association (UK) - several company members were present, some of
which were subsequently interviewed individually;
Federchimica (Centro REACH);
CEFIC;
REACH 1- 10 tonnes Phase 2
RPA & CSES | 167


VCI (Verband der Chemischen Industrie e.V., Germany), with whom we had a conference call
in which several global chemical companies participated; and
ORO (Only Representatives Organisation).
It became clear early on in the consultation process that there was very little information available
on the 1-10t market in general and little or no information on the M/Is of different sizes and their
product portfolios. The following conclusions were drawn in relation to information on numbers of
substances to be registered by different M/Is:






Numbers of 1-10t registrations by size of M/I: there is very little general information and
even companies consulted identified that it is too early to say which substances will be
registered in the 1-10t band, which will be registered in the 10-100t band and which will not
be registered at all. Much of the uncertainty appears to hinge on which substances will still
be used in a few years’ time. As 2018 gets closer more pressure is to be expected on Only
Representatives (ORs) and whether foreign manufacturers will register. Intentions are not
clear yet and a good deal of uncertainty and instability is to be expected;
That said, for a proportion of substances it is known that registration will be completed
because the substances in question will certainly still be in use (as they are
essential/important for various reasons);
The decision to register is influenced by the future life-cycle profitability of the substances in
question. In some instances notice has already been given of withdrawals, but generally
speaking it seems that there may be a certain advantage for manufacturers not to advise of
withdrawal for as long as possible (especially if they sell through others) plus the market can
change rapidly;
the consultation and research confirms that there remains very little information available
on the 1-10t substances;
Companies spoken to in depth (mainly low value added category) are acutely aware of costs,
but even the larger firms or manufacturers of high value substances are playing it very
carefully so as not to end up registering substances for which there will not be a demand in
2018 (cost is not always the driver); and
Companies seem to be postponing or (or not making public) decisions about registration – in
some instances because of the uncertainty involved, in some instances because it suits them
commercially to reveal their intentions as late as possible. Given the large number of
imports from outside the EU, some dislocation and consolidation will occur as the 2018
registration date approaches.
Regarding the questionnaire, respondents were asked for any information on (or to use their
industry knowledge and expertise to estimate) 1-10t registrations in general. Of particular interest
for modelling impacts on company level costs (and therein effects on innovation and
competitiveness) were questions aimed at generating information on:
1. The number of registrants for different substances – in particular, the percentage of
substance registrations of 1-10t substances that would be submitted by:
 Only one M/I;
 2-3 M/Is;
 4-6 M/Is;
 6-10 M/Is;
 10-15 M/Is;
 15 or more;
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2. The number of substances in the portfolios of micro, small, medium and large enterprises;
and
3. The number of micro, small, medium and large companies expected to register 1-10t
substances.
As might be expected from the above general conclusions, few felt they had enough knowledge or
information to comment on the generality of 1-10t registrations and few responses were received.
For those responses that were received, depending in the question, estimates varied but appeared
at least to suggest the following:
In relation to the number of registrants for different substances, generally low numbers of
registrants are expected for 1-10t substances with most substances having in the range of 2-6 M/Is,
some with only one and some greater than 6 M/Is. This is broadly consistent with the assumptions
and values applied in the 2003 and 2006 BIAs.
Regarding the number of 1-10t substances in the portfolios of micro, small, medium and large M/Is,
there is obvious uncertainty (as indicated by the general conclusions of the consultation) however
there seems to be a consensus that large M/Is will have larger portfolios and smaller M/Is smaller
ones. Again, this is consistent with assumptions and values applied in previous studies.
No useful information was gained from the consultation concerning the numbers of M/Is or different
sizes registering. However, statistical information can be gleaned from EUROSTAT.
Values applied in the simulation
The expected percentage of substance registrations of 1-10t substances that would be submitted by
different numbers of M/Is are provided in Table A2.20. As noted above, these are estimates based
on expected trends and should be sufficient for simulation and analysis of the costs of the different
options (especially as these estimates apply equally across all of the options). From Table A2.20, the
calculated overall average number of M/Is across the 20,000 1-10t substances is 4.4.
Table A2.20: Number of registrants for different 1-10t substances
Expected percentage of
substance registrations
Only one M/I
13%
2-3 M/Is
4-6 M/Is
6-10 M/Is
10-15 M/Is
38%
30%
12%
7%
Numbers of 1-10t
substance registrations
2,600
7,600
6,000
2,400
1,400
Regarding the numbers of M/Is of different sizes expected to register 1-10t substances, data have
been drawn from the analysis of EUROSTAT data undertaken for the Phase 1 study69. This suggests
the numbers of different M/Is in Table A2.21.
69
Changes in codes and groupings in EUROSTAT mean that it is not possible to reproduce the analysis with the
same resolution as for the 2009 data.
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Table A2.21: Number of manufacturers and importers of substances in quantities of between 1 and 10
tonnes in the EU27 by size of the companies
Micro
Small
Medium
Large
Total
C19.20: Manufacture of refined petroleum products
663
246
119
75
1,123
C20.11: Manufacture of industrial gases
700
241
111
33
1,085
C20.12: Manufacture of dyes and pigments
370
127
59
18
574
C20.13: Manufacture of other inorganic basic
658
226
104
31
1,020
chemicals
C20.13: Manufacture of other organic basic
1,354
465
214
65
2,098
chemicals
C21.10: Manufacture of basic pharmaceutical
374
240
131
55
800
products
C23.14: Manufacture of glass fibres
455
85
20
5
565
C23.20: Manufacture of refractory products
696
129
31
7
863
C24.41: Precious metals production
374
148
76
28
647
C24.45: Other non-ferrous metal production
433
171
88
32
749
Manufacturers
6,077
2,079
953
349
9,524
Importers
2,496
457
110
27
3,093
Total (rounded)
8,600
2,500
1,100
400
12,600
Source: EUROSTAT Structural Business Statistics database
Carrying these estimates through to the next step it is possible to estimate the average size of
portfolios of companies of different sizes. Here, as noted above, there is much uncertainty on the
exact numbers but agreement that large M/Is will have larger portfolios and vice versa.
Table A2.22 provides the number of M/Is of different sizes and estimates of the size of portfolios of
each. For the simulation, the average number of substances registered across the 20,000 substances
that can be derived from the data in Table A2.22 must be consistent with that drawn from the data
in Table A2.20 above (i.e. 4.4). The portfolio sizes given in Table A2.22 have been derived with
reference to this and adjusted until they produce an average of 4.4 M/Is per substance.
Table A2.22: 1-10t registrations by size of company
Size of enterprise
Number of companies registering 1-10t substances
Average number of 1-10t substances in M/I portfolio
A2.6.2
Micro
Small
Medium
Large
8,600
5
2,500
7
1,100
12
400
36
Allocation and aggregation of costs
The overall cost of registration for a substance depends on a number of factors where these include:




whether (and how much) toxicological and ecotoxicological information is required (or not);
the number of manufacturers and importers (M/Is) submitting a registration for the
substance;
the number of these M/Is that will be part of a joint submission and the number that will
submit an individual submission; and
the size of the M/I enterprise(s) registering a substance.
To provide an assessment of costs and impact, the Monte Carlo model achieves this by considering
one substance at a time, calculating costs and impact using a simulation that describes the likelihood
REACH 1- 10 tonnes Phase 2
RPA & CSES | 170
of the different situations, factors, events and M/I composition for each substance. In simple terms,
for each substance the Monte Carlo model carries out the following steps in order:

Step 1: Property profile and pathway - the Monte Carlo model generates a profile and
pathway through registration and information according to the option. This profile is
developed probabilistically using the information already provided in Sections A2.2 to A2.3
which governs:



whether a substance must generate toxicolocial and ecotoxicological information
under each of the options;
the cost of generating standard the information for an option for that substance
considering the available information and the need to purchase any existing test
information from the owner versus generate new information;
whether a substance meets any of the criteria requiring further studies for
mutagenicity and/or PBT/vPvB assessment and, therein, the costs of providing that
information (and summarising it in a dossier).

Step 2: Number of M/Is registering - the Monte Carlo model allocates a number of M/Is
registering the substance based on the percentages given in Table A2.20 (for example, there
is a 13% chance that a substance may only have one M/I, a 38% chance that it will have 2-3,
etc.);

Step 3: Size of M/Is registering - having assigned a number of M/Is to the substance in Step
2, the Monte Carlo model then assigns a code denoting the size of each of the M/Is
registering the substance (micro, small, medium or large). This is done in different ways for
different substances and registrants depending on whether there is existing test information
on the substance according to the modelled outcomes of Step 1:




For substances for which information on all current Annex VII endpoints already
exists the modelled simulation assumes that the first registrant (or only registrant in
the case of substances where there is only one M/I) owns that information and that
this M/I is a large enterprise;
For substances for which information on some Annex VII endpoints already exists
the modelled simulation assumes that the first registrant (or only registrant in the
case of substances where there is only one M/I) owns that information and that
there is a 75% chance that this M/I is a large enterprise and a 25% chance that it of
medium size;
For all other M/Is registering (and for all substances for which there is no
information), the Monte Carlo model assigns a size group to each of the M/Is on the
basis of probability. Here, logically, the probability that an M/I may be micro, small,
medium or large is a function of the numbers of M/Is of each different size expected
to submit registration dossiers for 1-10t substances and the average number of 110t substances to be registered by each (the portfolio size). The product of the
values for each M/I in Table A2.22 when expressed as a percentage of the total
across all M/Is gives the percentage probability of an M/I being micro versus small
versus medium versus large.
Step 4: Joint versus individual registration submitted – where there is only one M/I the
registration for the substance is, by default, an individual registration. Where there is more
REACH 1- 10 tonnes Phase 2
RPA & CSES | 171
than one M/I the Monte Carlo model determines whether all manufacturers will submit a
joint registration or whether the consortium will break into both joint and individual
registrations. The simulation assumes that in 70% of cases all M/Is submit a single joint
registration. This leaves a 30% probability of there being a joint registration plus one or
more individual registrations for a substance70. The simulation assumes that, where this
occurs for a substance, between 20% and 30% of the M/Is registering that substance will
submit individual submissions and the remainder will submit jointly. For each substance, the
Monte Carlo simulation model randomly selects a percentage value between these two
ranges (20-30%).
Applying the above steps, the modelled simulation allocates the appropriate cost to the individual
and/or joint registration of the substance accounting for the size of the M/Is (which affects the
registration dossier costs), the number of M/Is (which affects the costs of SIEFs and administration of
the joint registration) and the property profile and pathway of the substance (which affects costs of
testing and information, updating the SDS, proposals for animal tests, study summaries).
Where there is more than one M/I registering a substance, some costs are shared between all
registrants regardless of whether it is a joint registration or a mixture of joint and one or more
individual registrations. These costs comprise testing and information costs, participation in SIEFs,
study summaries and SDS costs. Where there is a joint registration, registration dossier submission
costs are shared between the members of the consortium only and where there are individual
registrations the appropriate individual registration cost applies. Where test information exists, the
cost of access to this information is shared between all but the first registrant (who is assumed to
own the information). All cost sharing between members of the consortium is allocated on the basis
of the tonnes produced by each manufacturer. Finally, the appropriate fee is allocated to each
manufacturer.
For each substance the modelled simulation produces the total cost of registration for each M/I
registering that substance where each M/I is allocated a unique identity number. When run on
20,000 substances, then, this produces a results table of the estimated costs of registration under
each of the options for each of the 12,600 M/Is of these 20,000 1-10t substances. Using a pivot
table, these data can be re-ordered and summarised to produce data on the total costs of the each
of the options to each M/I considering the number of 1-10t substances registered each M/I. In other
words, for each M/I the modelled simulation produces estimates of the total costs across all of the
1-10t substances registered by that M/I. Grouped into M/Is of different sizes, this allows assessment
of impacts on SMEs versus larger enterprises (amoungst many other things).
70
This is higher than for registrations in 2010 for >1000t substances. This is to reflect the fact that speciality
chemicals may comprise a more significant proportion of the number of substances in the 1-10t band and
MIs may not wish to share information on the specialised (and hence potentially commercially sensitive)
uses of substances.
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RPA & CSES | 173
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