EU Commission invites feedback on its vision of restructured European Chemicals Agency

The European Commission has launched a call for evidence via the “Have your say” portal, inviting public feedback ahead of the EU executive’s upcoming legislative initiative for a stand-alone “founding regulation” aimed at updating the European Chemicals Agency’s (ECHA) roles and responsibilities. The Commission plans to overhaul the agency’s structure by clarifying the duties the agency has been tasked with since 2008 and incorporating new responsibilities foreseen under the Chemicals Strategy for Sustainability (CSS). The initiative is also expected to redefine the way the agency’s operations are financed to ensure predictable, sustainable performance over time.

BY SCOTT STEPHENS, MPA | SEP 22, 2022 10:58 AM EDT

How is ECHA regulated today?

  • Title X of the Regulation on the Registration, Evaluation, Authorization and Restriction of Chemicals ( REACH – 1907/2006/EC) established the European Chemicals Agency (ECHA) and defines its operations, roles, and responsibilities. The agency is charged with managing significant sections of the EU’s main horizontal chemicals control legislation pursuant to REACH. The agency provides scientific and technical expertise as well as administrative support for all aspects of the regulation (e.g., in support of implementing the registration, evaluation, authorization, and restriction of chemicals). In addition, ECHA oversees the Enforcement Forum, the network of member-state authorities charged with enforcing EU chemicals legislation.
  • ECHA is authorized to manage all its internal affairs, including the composition of its committees (e.g., member state committee (MSC), and the committees for risk assessment and for socio-economic analysis (RAC, SEAC)); the agency’s decision-making and adjudicating bodies (e.g., management board, board of appeal); and its financing activities.
  • As EU chemical management rules have been added or updated since REACH’s inception in 2007, the agency has been steadily tasked with more and more scientific, technical, and administrative work and related duties. The agency now oversees tasks originating from many parts of the EU’s chemicals regulatory framework, including the Classification, Labeling and Packaging Regulation (CLP – 1272/2008/EC), Biocidal Products Regulation (BPR – 528/2012/EU), Prior Informed Consent Regulation (PIC – 649/2012/EU), Persistent Organic Pollutants Regulation (POPs – 2019/1021/EU), Waste Framework Directive (WFD – 2008/98/EC), Water Framework Directive (WFD – 2000/60/EC), and the Chemical Agents and Carcinogens and Mutagens directives (CAD, CMD – 98/24/EC and 2004/37/EC, respectively).
  • Over time, the substantial growth in ECHA’s workload has led to increased complexity and diminished transparency in how duties are assigned and carried out by the individual bodies comprising the agency. This lack of clarity is compounded by the fact that ECHA’s mandate does not reside in one centralized, uniform set of rules, but instead its roles and responsibilities flow from the very pieces of legislation that have assigned the agency its tasks through the years since its founding. For example, REACH’s Articles 75-111 (Title X) specify ECHA’s tasks as they relate to that regulation and (to a lesser extent) to the CLP. BPR’s chapter XVI stipulates ECHA’s tasks concerning its scope, while the POPs Regulation’s Articles 8 and 16 define ECHA’s roles under its remit. This fragmented mess of ECHA-related provisions complicates implementation and compliance across the board for the agency and member states.

The arrival of CSS necessitates adjusting ECHA’s mandate

  • A principal goal of the Chemicals Strategy for Sustainability (CSS) is to simplify and consolidate the EU’s current legal framework concerning chemicals.
  • In the context of the founding regulation, the European Commission intends to realize this goal under CSS’s “one substance – one assessment” (1S1A) initiative, which “aims to improve effectiveness, efficiency and coherence of the safety assessment of chemicals across chemicals legislation.”
  • 1S1A encompasses two principal aims specific to the Commission’s initiative, the founding regulation: updating the legal framework defining ECHA commensurate with its future role and ensuring that the agency is sufficiently financed to maintain balanced, sustainable operations over the long run. (Separately, see AgencyIQ’s July 29, 2022 article for details on another legislative initiative under 1S1A intended to improve access to chemicals data used for safety assessments.)

Strengthening ECHA’s governance

  • First, the founding regulation will seek “to strengthen the governance of ECHA.” The call for evidence states that the EU will achieve this ambition “by consolidating ECHA’s purpose, clarifying its expected results, and optimising and rationalising how ECHA’s bodies operate.”
  • This part of the initiative is expected to clarify and expand, above all, the structures and tasks of the agency’s risk assessment (RAC) and socio-economic analysis (SEAC) committees, as well as the Enforcement Forum, the network of member-state enforcement authorities overseen by ECHA.
  • RAC’s profile, in particular, requires modifying to accommodate the larger number of scientific opinions needed to support (1) existing legislation (e.g., Drinking Water Directive – DWD); (2) legislation currently awaiting revision (e.g., the REACH and CLP revisions); and (3) new legislative initiatives that are still either in preparation or the proposal phase (e.g., Batteries Regulation).
  • RAC will be assigned additional duties as a result of the Commission’s separate legislative initiative that seeks to assign or reassign duties to EU agencies in an effort to streamline and optimize chemicals assessment-related tasks. For RAC, this will likely entail taking on relevant tasks reattributed from the Commission’s Scientific Committee on Consumer Safety (SCCS) and Scientific Committee for Health, Environmental and Emerging Risks (SCHEER), among others.
  • The initiative anticipates adapting ECHA’s processes and working practices in line with the ‘Common Approach’ as adopted in the 2012 Joint Statement of the European Parliament, the Council of the EU and the Commission on decentralized agencies. By doing so, the Commission’s goal is to “ensure synergies, guarantee the independence of ECHA scientific bodies and strictly avoid any potential conflicts of interest.”
  • Finally, the founding regulation is expected to formalize ECHA’s working relationships with other agencies also involved in chemical safety assessments, including with the European Food Safety Authority (EFSA) and the European Medicines Agency (EMA).

ECHA’s financing model today and tomorrow

  • The founding regulation will also lay down provisions restructuring the agency’s financing mechanisms. This goal is necessary given the unpredictable nature of ECHA’s revenue streams under the current financing model and the fact that annual income is predicted to decline going forward if the status quo continues.
  • ECHA’s current sources of financing are derived from fee income and an annual EU balancing contribution. Historically, the lion’s share of total income has originated from fees generated under REACH and CLP, primarily from the registration and authorization of substances. As ECHA’s 2021 Report on the operation of REACH and CLP (chapter 5, pp. 70-73) shows, over the 13-year period from 2008 to 2020, ECHA’s REACH-related operations were funded through fee income totaling 69% and the remaining 31% from the EU balancing contribution.
  • Following the third and final deadline to register existing substances under REACH in 2018, fee income has dropped significantly, leading ECHA to rely more heavily on the EU balancing contribution. In 2020, for example, fee income accounted for just 32% of ECHA’s budget, while the remaining 68% of income came from the EU balancing contribution.
  • This drop in fee income is compounded by ECHA’s convoluted budgetary framework, which draws on three separate budgets under three different regulatory schemes: (1) REACH and CLP; (2) BPR; and (3) environmental and international conventions that fund ECHA’s scientific and technical work supporting legislation like PIC and POPs. ECHA also receives funding from WFD and the Drinking Water Directive (DWD). Under this system, funds are distributed separately under each regulatory scheme. The disjointed nature of its funding scheme has hindered ECHA’s ability to allocate expert staff and other resources freely across the organization in accordance with the agency’s ever evolving objectives.
  • The call for evidence states that the founding regulation will “consider repealing the provisions in different pieces of legislation, which ring-fence ECHA’s budget strands, to create one budget for the Agency.” ECHA intends to form a more flexible organization by eliminating administrative burdens created by the three isolated regulatory schemes and thereby allowing the agency to optimize the use of all its resources as ECHA’s organization-wide priorities change over time.
  • The Commission’s proposal is also expected to introduce new sources of revenue in a bid to make up for the losses in fee income sustained since 2018 and to provide alternative income sources for supporting the agency’s ongoing operations. According to the call for evidence, ECHA has investigated several possible options for revising the current fee system within the context of the REACH revision under CSS. Such sources will likely include new types of fees on “certain operations related to the manufacturing, import or use of chemicals, reflecting the work carried out by ECHA.”

What’s next?

To contact the author of this item, please email Scott Stephens ( [email protected])

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