Waking up after a night of overindulgence on food and wine and realising you don’t have a headache is very satisfying. But realising, soon afterwards, you have heartburn can bring your mood down rapidly.

After years of discussion and argument around Brexit, the UK woke up to find that a Trade and Cooperation Agreement between the UK and the EU been reached. A major headache had been avoided.

UK Businesses have a new trading landscape

However, the UK chemicals sector soon realised that after pulling back the curtains and taking a look at the new trading landscape, a feeling of heartburn was rising. The chemical sector’s regulatory obligation now requires that it establishes a UK-REACH system. The deal negotiated means that the UK has no access to the data it submitted to the EU’s REACH database.

In effect, the UK chemical sector has to populate the UK-REACH system from scratch. This will require an array of steps possibly including testing and renegotiating data sharing with other companies. According to the Chief Executive of the Chemical Industries Association (CIA), Steve Elliot, this is set to burn a £1 billion hole in the UK chemical sector’s pocket.

‘Failure to secure access to what has been a decade’s worth of investment by UK chemical businesses in data for EU REACH will leave the industry facing a bill of more than £1 billion in unnecessarily duplicating that work for a new UK regime,’ said Elliot in a statement on 24 December 2020, the day that the UK government excitedly announced the new trade deal.

UK-REACH could cost more than £1 billion

As a slightly belated Christmas gift, and perhaps just taking the edge off the heartburn, the UK government’s Environment Minister, Rebecca Pow announced, on 31 December, that the UK-REACH IT system was up and running. Pow said that the government had worked closely with partners, industry and stakeholders developing the IT system to manage the UK’s chemicals industry.

‘Having our own independent chemicals regulatory framework will ensure that we make decisions that best reflect the UK’s needs while maintaining some of the highest chemical standards in the world,’ she said.

But will these high standards do what REACH was set up for in the first place, and protect human health and the environment? According to CHEM Trust, a UK-German charity focused on preventing man-made chemicals from causing long term damage to wildlife or humans, the deal does not go far enough.

Critiquing the outcome, Michael Warhurst, Executive Director of CHEM Trust said, ‘CHEM Trust’s initial assessment is that this agreement does not adequately protect human health and the environment in the UK from hazardous chemicals. This is because it doesn’t retain UK access to the EU’s chemicals regulation system REACH. The agreement includes an annex on chemicals, but does not facilitate the type of close cooperation with the EU post-Brexit that civil society groups such as CHEM Trust, and also the chemicals and other industries are seeking.’

But on a positive note, Warhurst added; ‘The deal […] commits the UK to not regress from current levels of protection, includes a rebalancing procedure which could increase protection on both sides and offers a platform on which a closer partnership could be negotiated in the future.’

No one doubts that there is still much to be digested, along with those left over Christmas chocolates that nobody really likes, regarding the UK-EU Free Trade Agreement. ‘Although this Free Trade Agreement represents a mixed bag for our industry,’ said the CIA’s Elliot, ‘we shouldn’t underestimate the huge value that a deal brings in terms of certainty.’

2021: A year to look forward to

As people return to their desks after the Christmas break, one might dare to hope that the heartburn can be quelled with a dose of optimism after the challenging year that has just passed. With this as a basis, along with eventually emerging from the global pandemic, Elliot believes 2021 should be ‘a year to look forward to’.