On September 10, 2015, the European Court of Justice
("ECJ") delivered a key decision on the concept of an
"article" containing a substance of very high concern
("SVHC"). The decision, which was highly anticipated,
particularly in France, responded to a request for a preliminary
ruling of France's Supreme Administrative Court (Conseil
d'Etat) of February 26, 2014.
The decision examined the following obligations under the
Regulation on Registration, Evaluation, Authorisation and
Restriction of Chemicals ("REACH"). Article 7(2) REACH
requires a notification to the European Chemicals Agency
("ECHA") of any article placed on the market in the EU
that contains an SVHC in a concentration above 0.1% w/w (percentage
weight/weight). Article 33 REACH requires the provision of such
information to recipients of the article and upon request to
consumers.
The legal issue is whether the 0.1% w/w threshold should apply
either to (i) a complex product, consisting of several separate
component articles, or (ii) each of such component articles.
Article 33 REACH defines an "article" as "an object
which during production is given a special shape, surface or design
which determines its function to a greater degree than does its
chemical composition." This definition, however, was
inadequate for determining the scope of application of the 0.1% w/w
threshold. Thus, the European Commission addressed this issue in an
opinion dated February 4, 2011. It indicated that "objects
which at a certain step in their life-cycle meet the definition of
article under REACH cease to be individual articles and become
components once they are assembled into another article. For
this reason, the obligations in Article 7(2) and 33 apply only with
respect to such assembled article, and not with respect to its
individual components" (emphasis added).
ECHA's guidance on requirements for substances in articles took
a similar view. However, six EU Member States (France, Germany,
Belgium, Denmark, Sweden, and Austria) and Norway did not share the
Commission's and ECHA's views and published dissenting
opinions in May 2008. The French Ministry of the Environment also
published an opinion in June 2011 asserting that the concept of
"article" should be understood as each item falling under
the definition of an "article" under REACH. Thus,
"French authorities will apply the provisions of Articles 7(2)
and 33 relying on these elements. Controls will be progressively
enforced in order to ensure compliance with these provisions
through an approach both pragmatic and proportionate with regards
to sanitary and environmental concerns."
Two French professional federations challenged this June 2011
opinion before the Conseil d'Etat, claiming that it
did not comply with either the European Commission's opinion or
ECHA's guidance.
In its decision of September 10, 2015, the ECJ ruled in favor of
the French Ministry of the Environment's more expansive
interpretation of the concept of "article." Thus, the
obligations to notify and inform equally apply to any article,
including those incorporated as component articles of a complex
product, containing a concentration of an SVHC above 0.1%
w/w.
Specifically, the requirements now apply as follows:
With respect to the notification obligation under Article 7(2)
REACH, EU producers of articles must notify ECHA of any articles
they produce containing SVHCs above 0.1% w/w. This obligation,
however, does not apply to component articles containing SVHCs
supplied by third parties (who are presumed to have already
notified these).
EU importers must notify ECHA of all articles, including any
component articles from which they are assembled, containing SVHCs
above 0.1% w/w.
The information obligation under Article 33 REACH applies in the
same manner to both EU producers and EU importers. Relevant
information must be provided for any article, including any
component article from which they are assembled, that contains
SVHCs above 0.1% w/w. This is to ensure that the SVHC information
is provided throughout the whole supply chain.
Thus, any EU supplier of articles must have sufficient information
about the content of SVHCs in any of the component articles. This
is particularly burdensome for EU importers, who often have limited
information about the components of the article that they import.
This is due to the fact that the article as a whole, or its
sub-assemblies, might have been supplied by non-EU manufacturers
that have no regulatory obligation to communicate the SVHC content
(companies established outside the EU are not subject to
REACH).
To address the ECJ's findings, ECHA has already announced the
update of the Guidance.
In our view, guidance is particularly needed on the definition of
"component articles," i.e., what should be the lowest
component level of reference. For example, EU legislation on the
restriction of dangerous substances in electronic products applies
the weight thresholds on "homogeneous materials" inside
the products, including coatings, containers, etc. In our view, for
REACH purposes, suppliers should be able to apply a less minutely
detailed identification of components.
In its Opinion preceding the Judgment, the Advocate General stated
that any item should be considered a component article as far as it
retains, after the incorporation into the final product, its own
original shape, surface, or design. Seats were used as example:
each distinct component of a seat should be considered as a
component article, e.g., upholstery, springs, or the seat
frame.
However, this means that any component that, after the
incorporation, has lost its shape etc., should be considered as an
integral part of the whole product. This will be the case with, for
example, plastic film (previously an article) that is incorporated
into the final product. Also, components that had been substances
previously (e.g., polymer pellets) should not be considered as
component articles after they have been shaped during the
production of the final product.
Since the ECJ has now ruled that the notification obligation
triggers at the component level, arguably the notification under
Article 7(2) and Article 33 should always clearly identify the
component article in addition to the 0.1% w/w statement, in
particular since the Commission and ECHA might take the view that
this is necessary to allow the safe use of such articles under
Article 33(2) REACH. However, from a practical point of view, this
seems unworkable in the case of complex articles.
The ECJ's interpretation is immediately applicable as it does
not require any implementation or amendment of REACH. The
Commission, however, might recommend that national enforcement
authorities apply a grace period for component articles already in
the EU supply chain. Nevertheless, companies must be aware that
immediate enforcement remains a possibility, particularly in those
Member States that already endorsed the ECJ's interpretation
(including France).
The judgment is available at C‑106/14 FCD and FMB v Ministre de
l'Écologie, du Développement durable et de
l'Énergie, September 10, 2015.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.