Chemical Regulations in China: Industry and Stakeholders Obligations

State Council of China introduced the revised Regulation on Safety Control of Dangerous Chemicals in 2-Mar-2011, which would formally enter into force in 1-Dec-2011¹, and under this newly reformed chemical regulation, which function as the umbrella law, different Ministries and Administration will be involved into implementation and various administrative provisions promulgated accordingly as well, and then the resulting regulatory challenges to chemical industry were concerned and highlighted recently. Within this article, the primary regulatory obligations and related challenges were reviewed.

Contents

• Introduction

• Overview on the Chinses Chemical Regulation Regime

• Key Challenges

• Conclusions

Introduction

With around 30 percent annual increase since 2000, China has become one of the largest chemical markets worldwide, following United State and European Union ², while the improvement in the chemical regulation regime was just listed into the agenda of Chinese rule-makers recently, and then sorts of regulatory changing will impact the industry somewhere. Herein, the progress on chemical regulation, primarily including the reform on the new chemicals notification and GHS implementation, and the newly raised challenges to chemical sector were closely observed.

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Overview on the Chinese Chemical Regulation Regime

Subject to the latest revision, State Council of China issued the “Regulation on Safety Control of Dangerous Chemicals” (hereafter referred to as “Revised Regulation”) in 2-Mar-2011, and it will enter into force in 1-Dec-2011 to replace the current version which was effective in 2002 (hereafter referred to as “Current Regulation). The Revised Regulation will become the umbrella law stipulating the basic regulatory principles on existing or new chemical substances with hazardous profile, furthermore, the related competent authorities will promulgate the administrative provisions to implement the Revised Regulation accordingly in practice.

General Rules

The dangerous chemicals subject to the “Revised Regulation” refer to the chemical substances with toxic properties or other hazardous profiles of explosive, oxidizing, corrosive and flammable/combustible, which have potential hazardous impacts on human, facilities and environment.

A consolidated inventory of dangerous chemicals will be jointly announced by implementing authorities according to the Chinese hazard classification standards of chemicals which were developed based on the UN Globally Harmonized System of Classification and Labeling of Chemicals (GHS). The National Standards include GB 13690, “General rules for classification and hazard communication of chemicals”, and 26 technical National Standards (GB20576 to GB20599, GB 20601 and GB 20602) issued in 2006 ³.

The activities stipulated under “Revised Regulation” will cover the whole life stage of the dangerous chemicals, from production to the final use, including manufacturing, importation, transportation, storage, selling and final uses.

Implementation Authorities

The regulatory implementation system seems complicated and fragmented, and different competent authorities were entitled to regulate the dangerous chemicals with the jurisdiction set out within article 6 (more detailed please see Table 1.)

Administrative Provisions and National Standards

Under the umbrella law, titled “Revised Regulation”, the given implementing authorities should impose the responsibilities set out within the law by promulgating the corresponding administrative provision, and the National Standards was the technically regulatory requirements for each companies and authorities subject to the “Revised Standards”. Herein were the available rules and the identities of the rule-makers.

Table 2. The administrative provision promulgated by related authorities

Notification of New Chemical Substance

According to Article 98 of Revised Regulation, all the new chemical substances should be notified with regard to the “Measures on environmental management of new chemical substances” (here after referred to as “China REACH”), which was promulgated by Ministry of Environmental Protection (MEP) in 15-Oct-2003, and revised it in 15-Oct-2010. The new chemical substance was defined as the chemicals which was subject to this administrative rule and not listed into the Inventory of Existing Chemical Substance in China (IECSC) as well ⁴. As some elements regarding EU REACH Regulation (EC 1907/2006) ⁵, including tonnage-dependent data requirements and risk-based assessment, were applied into this revised provision, and then this Measure were dubbed as “China REACH” somewhere.

Safety Data Sheet (SDS) and Labeling

Based on Article 15 of Revised Regulation, all the dangerous chemicals should be re-classified in accordance to the given National Standards which were adopted from UN Global Harmonization System of Classification and Labeling, and then the compliant label and Safety Data Sheet should be provided down the supply chain.

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Key Challenges

Some regulatory challenges were raised with the increased complexity of this newly revised chemical law regime, and the primary challenges were outlined here.

China REACH

Applicant Qualification

The qualification of notifier for new chemicals was only applicable to Chinese local legal entities, and the oversea companies with exportation business to China were not able to notify the related chemicals without appointing one Chinese local agent to submit the notification dossier, and then their business would be influenced or suspended without compliance.

Chinese Local Eco-toxicological Testing

According to the Article 10 and 12 set out within China REACH, sorts of eco-toxicological testing should be carried out within Chinese local accredited laboratories (11 approved testing facilities till 1-Oct-2010) ⁶ using China-originated test specimen.

Due to the capabilities of testing for these 11 laboratories in limited time period, it would be hard for applicants to fill in the related data gaps by testing to complete the notification dossier in due time

Language Barriers

All the dossiers should be in Chinese and as to the testing report in foreign language, the Chinese summary needed as well.

All the notification materials should be in Chinese excluding the full testing report from oversea testing laboratories which was acceptable in English solely, and then it would be difficult for the applicants without expertise to bypass this language hurdle.

Complexity in Submission

As to the requirement on filing procedures under China REACH, both the paper-based and electronic documents are required to be submitted to the authority, and currently the communication liaison with government during notification process only be carried out in Chinese.

CBI Protection

Kinds of confidential business information (CBI) should be claimed and protected within this notification process, and the applicant should well understand the approach in which the confidential information could be claimed and how authorities would handle these kinds of information. In some occasions, the third party possessing CBIs would be appointed and involved into the whole notification process to file to the authority directly.

China GHS

Chinese Terminology

It was obligatory to keep the H-phrase or other terminology in label or SDS complying with the Chinese standards and it will be hard for kinds of company using the software to handle the label and SDS issues.

Updating on the list of dangerous chemicals

The list of dangerous chemicals is just subject to the updating according to the Revised Regulation and the scope of chemicals defined as “dangerous” will be broadened, and then it would be challenging for those companies influenced by this updating to comply with the newly coming regulatory requirements.

Uncertainties on the substances without inclusion

Here are no clear implementing rules on how to handle the substances without inclusion of the list of dangerous chemicals, and the authority recommend that the related companies to initiate necessary testing to self-classify their substances and then revise the label and SDS, however, the uncertainty still remain on the regulatory requirement on chemicals with listing.

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Conclusions

With the newly implemented chemical regulatory system, some compliance-related challenges come up to the chemical sector based in China or worldwide, and it was highly recommended that each enterprise with Chinese chemical business to re-check their legal obligation with the progress of regulatory regime.

Key Sentences:

1. New challenges are raised from the chemical regulatory reform in China.

2. It is time for your attention on the progress of the chemical regulatory updating in China.

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Note:

1. China Chemical Industry Yearbook, Chemical Industry Press, 2006