New Ways in the Ancient World: Japan and China advance their chemicals policies

Allison Tracy is a Chemicals Policy Fellow.

This isn’t the first time on this blog that we’ve observed that chemicals reform is popping up all over the world.  Whatever their strengths and shortcomings, the 1999 amendments to the Canadian Environmental Protection Act and the European Union’s REACH Regulation got the ball rolling.  The momentum of chemicals reform is reaching around the globe as governments pay more attention to the risks posed by chemicals.  In this post, we will focus on recent developments in Japan and China.

Japan and China are two of the U.S.’s top competitors, so it’s noteworthy that they have not allowed themselves to fall behind in chemicals management.  Why are they expanding their chemicals regulations?  Do they know something we don’t? 

Japan and China are responding to public demand for chemicals that won’t harm human health or the environment.  We’ve made the case before on this blog that raising the bar on chemical safety can encourage innovation that better aligns the chemicals industry with consumer demands for improved safety.  This is the new market.

It is abundantly clear that U.S. consumers value safe products as well.  A recent article in the Wall Street Journal recounts how Hilton Hotels and Resorts placed a high premium on safety when selecting a new retail brand for the soaps and lotions it provides to its U.S. customers.  Hilton was attracted to the brand it selected in part because of that company’s business in Japan, which has regulations that Hilton saw as leading to safer products than those made in the U.S.  So there you have it.  The American people want safer products and American companies are choosing suppliers based on this demand.

Growing demand is leading Japan and China to upgrade their chemical safety approaches:

Japan: Not an island unto itself

We described Japan’s efforts and their resemblance to REACH in an April blog post, but that was only the beginning.  Japan continues to roll out enhanced regulations under its Chemical Substances Control Law (CSCL) (also see here).  Companies manufacturing and importing chemicals in Japan submitted notifications on June 30th for chemicals produced in volumes over 1 tonne (metric ton) as well as for 88 “Priority Assessment Chemicals” (PACs) produced at any volume.  PACs are those chemicals deemed to be of particular concern based on a combination of exposure and hazard information.

The basic notifications include information on chemical identity and production volume as well as the categories of use.  The reporting requirements are more extensive for the PACs, including details on production volume, import data, shipping volume and category of use.

The Japanese Ministry of Economy, Trade and Industry (METI) will use information from the CSCL notifications to develop an expanded list of PACs.  These chemicals will then undergo risk assessments.  The prioritization process will ultimately allow METI to request hazard data on chemicals that raise significant concerns.  The first list of PACs was published on April 1st and METI forecasts the addition of approximately 1,000 PACs by March of 2012.  Additional information on the June 30th deadline and subsequent prioritization process can be found in this June 28th Chemical Watch article (subscription required).

(The identification of high-concern chemicals has been slow to catch on in the U.S.  In a recent blog post, Richard Denison discusses the political barriers that have stymied EPA in its efforts to exercise its clear legal authority to list chemicals of concern under TSCA.  However, recent EPA efforts to identify priority chemicals are promising.  The American Chemistry Council has even proposed its own prioritization tool, which EDF found useful, if flawed.)

We have already pointed out the similarities between the reporting system under the CSCL and the U.S. Inventory Update Reporting (IUR) rule, noting how Japan’s system improves upon the IUR.  This comparison is particularly relevant given that this summer EPA released the final rule for amendments to the IUR, now renamed the Chemical Data Reporting (CDR) rule.  These amendments, once fully implemented, will address many of the shortcomings that prevented EPA from collecting in past cycles data necessary to evaluate the risks posed by chemicals.  One concern with the new rule, however:  the considerable wait we’ll have until full implementation of the changes (see our blog post here).

Meanwhile, Japan’s METI has received approximately 10,000 submissions under the June 30th deadline and is in the process of reviewing notifications.  This review consists of checking substance identity and starting the process of identifying and listing additional Priority Assessment Chemicals.

Of course, there are challenges.  The quality of the information submitted by industry was limited from the beginning, given that companies needed only submit data that were immediately available to them.  However, reporting did extend to unpublished test data, and there is an obligation to report new information as it becomes available to them.  In conjunction with other agencies, METI has created a panel that will confer on criteria to be used to judge information quality (Chemical Watch, subscription required).

The developments in Japan are not occurring in a vacuum.  The advances in chemicals management are in step with a global push towards enhanced chemicals safety.  Likewise, the challenges they face are common to many global reform programs.  The United States can learn a lot from Japan and other nations as they move ahead of us in implementing more modern policies.

China: Not a free-for-all

China has had its own wave of noteworthy events in the realm of chemicals reform.  Our November blog post highlighted China’s reformed regulations on new substances.  In recent months, the Chinese have begun revamping their regulation of existing substances.  As we’ve noted previously (see here and here), these advancements call into question the assertion that tougher U.S. chemical regulations will “ship jobs to China.”  Increasingly, the chemicals industry in China is not an unregulated free-for-all.

A recent headline about chemicals management in China is pretty eye-catching: “Asian economies set pace on chemicals management” (Chemical Watch, subscription required).  According to that article, popular and political pressure for improved environmental health is a very real factor driving change in China.  The government is integrating chemicals management into its environmental agenda and taking a greater interest in safety measures in the chemicals industry.  In fact, reducing pollution through safe management of industrial chemicals is part of China’s twelfth 5-year plan (2011-2015).  Chinese officials are already taking action under this mandate, for example, in their recent announcement of a national campaign to target pollution from production and use of industrial chemicals.

Update on China’s new chemicals program: The 2010 amendments to the Measures on Environment Management of New Chemical Substances introduced a new paradigm in China.  If a chemical is not on the Inventory of Existing Chemical Substances in China (IECSC), the companies producing that chemical must submit a registration and notification.  The Chinese system adopts some of the elements of REACH, including enhanced materials safety data sheets and its own version of REACH’s Chemical Safety Report (CSR).  A recent article in Chemical Watch (subscription required) notes differences between REACH’s CSR requirements and the Chinese risk assessments, but China has conserved REACH’s emphasis on risk characterization based on hazard and exposure from specific uses.

Notably, REACH CSRs are required for chemicals with production volumes greater than ten tonnes per year, while China requires risk assessments for new chemicals manufactured or imported in volumes exceeding one tonne per year.  Requiring risk assessments for new chemicals is a new development in China, just one indication that it is getting serious about improving safety.

Tackling existing chemicals in China:  To complement its 2010 updates to new chemical regulations, China introduced the Regulation on Safe Management of Hazardous Chemicals (Decree 591) in March of 2011 (to be effective December 1st).  Decree 591 authorizes ten Chinese agencies to work together to address risks posed by existing chemicals.  The State Administration for Work Safety (SAWS) is in charge of the “Dangerous Substances List”.  China currently lists such substances on its “Dangerous Goods List”, but the new regulation will increase the number of chemicals from approximately 3,000 to over 7,000 by 2012.  In both the past and present systems, domestic manufacturers and importers are required to register existing, hazardous chemicals with the National Registration Center for Chemicals (NRCC).

According to the consultant, the Chemical Inspection and Regulation Service (CIRS), only domestic – not foreign – companies operating in China have to register under the existing chemicals regulation.  If true, this would be quite ironic, given that it contradicts the cynical view of some in the U.S. industry that chemicals reform taking place in China will only be applied to foreign companies in order to disadvantage them relative to domestic companies.

SAWS published an inaugural list of 60 priority chemicals at the end of June.  Our analysis of the 59 available CAS Registry numbers illustrates the extent of overlap between China’s “Dangerous Substances List” and chemicals in the U.S. and the E.U.:

  • All 59 chemicals appear on the public portion of the U.S. TSCA Inventory, which lists the approximately 67,000 chemicals in commerce in the U.S.
  • Eight of the 59 chemicals are subject to Section 4 test rules under TSCA, which EPA issues for chemicals that meet certain risk- or exposure-based criteria.
  • 57 chemicals were reported in the 2006 cycle of EPA’s Inventory Update Reporting (IUR), which lists chemicals manufactured in amounts exceeding 25,000 pounds per year per site.
  • 52 of the chemicals have dossiers submitted for the December, 2010 deadline under REACH (as listed on ECHA’s website as of July 26th, 2011)
  • Ten of the chemicals are classified by the European Union as known or suspected carcinogens, mutagens or reproductive toxicants (CMRs).

Listing on the “Dangerous Substances List” in China requires companies involved with the use, sale, transportation, storage or manufacture of these priority chemicals to engage in specific safety measures.  Requirements include providing safety evaluation reports and safety data sheets, obtaining operating licenses, registering hazardous chemicals, and labeling chemicals in accordance with China’s labeling requirements, which are based on the internationally accepted Globally Harmonized System (GHS).  The regulation is the first action to back up China’s GHS-based standards with legal consequences.

China is also introducing improvements in its enforcement system, the leniency of which has posed significant challenges to the country’s environmental programs in general (Chemical Watch, subscription required).  In the realm of chemicals regulations, China now can address non-compliance by imposing fines, halting manufacture and use of a chemical, and utilizing criminal proceedings.

Conclusion

Consumer demand for safer chemicals is coming not only from Japanese and Chinese citizens, but also from consumers around the world.  A new market is emerging as a result of this demand and it is changing the face of global chemicals regulations as well as the environment for businesses related to chemicals.

Pressure for safer chemical policies is strong in the U.S., but regulatory reform is lagging.  The pressure has led to recent legislative efforts to reform the Toxic Substances Control Act.  Momentum is building and the inevitable outcome – even if it takes a while yet for us to get there – must be U.S. re-entry into the new era of chemicals management.  It’s time for us to join our neighbors in the 21st century.

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