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Discover five often overlooked risks the REACH Regulation poses for manufacturers.
Companies that build machinery, manufacture sensors or supply assemblies rarely think of REACH as something that applies to them. That is a mistake that can prove costly.
The Regulation affects manufacturers across a wide range of industries, including mechanical engineering, electrical engineering and medical technology. Wherever substances are used or products contain chemical substances, REACH applies. Non-compliance can result in market restrictions, financial penalties and reputational damage.
REACH stands for Registration, Evaluation, Authorisation and Restriction of Chemicals. The Regulation is administered by the European Chemicals Agency (ECHA) and has been in force since December 2006. It governs how chemicals, mixtures and articles may be manufactured, imported and placed on the market within the European Union. Its objective is to protect human health and the environment from substances of very high concern.
REACH does not apply solely to chemical manufacturers. It also affects all manufacturers and importers that use or import substances into the EU in quantities exceeding one tonne per year.
REACH governs four core areas:
The Regulation affects not only manufacturers and importers but also downstream users that use substances in their own production processes, as well as suppliers of articles containing SVHCs above the 0.1% weight-by-weight threshold.
The most common challenge is not a legal one. It is an organisational one. Many manufacturers do not have complete visibility into the raw materials contained in purchased parts, raw materials and semi-finished products.
REACH requires active communication throughout the supply chain. Suppliers must provide Safety Data Sheets (SDSs). Companies supplying articles containing SVHCs above 0.1% by weight must also disclose this information upon request. In practice, this means manufacturers depend on their suppliers to provide complete and up-to-date data.
Collecting supplier information by email and maintaining it in Excel is not simply a data management issue. It is a system failure. ECHA updates the Candidate List several times each year. A substance considered compliant today may be designated as an SVHC tomorrow. Without knowing which products contain that substance, companies cannot respond effectively or demonstrate compliance.
Registration obligations are volume-based. Once a substance reaches one tonne per year, registration becomes mandatory. At volumes above 100 tonnes per year, the data requirements increase significantly, including toxicological and ecotoxicological information.
In practice, many manufacturers lack a complete overview of which chemical substances are used and in what quantities. Product changes, new formulations or expansion into new markets can shift volume thresholds without anyone noticing.
This becomes particularly critical for companies importing substances from outside the EU. In these cases, the importer assumes the manufacturer’s registration obligations in full. Many companies are unaware of this until contacted by ECHA. Preparing a registration dossier takes time. Companies that only react after a deadline has passed may temporarily lose the ability to place affected substances on the market. For manufacturers, that can mean delivery delays, contractual penalties and lost customers.
The path to authorisation begins long before a substance becomes subject to it. A substance is first added to the SVHC Candidate List before it may eventually be included in Annex XIV. Several years often pass between these two stages. During this period, companies may continue using the substance without realising that they face a limited timeframe to either phase it out or apply for authorisation.
Once the applicable sunset date has passed, substances listed in Annex XIV may only continue to be used with explicit authorisation from the European Commission. Companies that do not submit their own application must operate under an existing authorisation granted to their supplier.
As of January 2023, the Candidate List contains more than 230 entries and continues to grow. Companies that do not systematically compare this list against their product data are forced to rely on manual, infrequent and incomplete checks. This is not a matter of individual diligence but of system design. Without a structured link between substance data and product data, reliable compliance verification is simply not possible.
Annex XVII lists specific chemical substances whose manufacture, use or placing on the market is restricted or prohibited. The list continues to grow as the Regulation is updated. A product that is compliant today may no longer be compliant tomorrow.
Restrictions apply not only to the substance itself but also to its use in specific products. A material that is permitted in an industrial solvent may be prohibited in a consumer product. These distinctions are often subtle and highly context dependent.
For this reason, compliance is not a one-time assessment. Every product modification, every new supplier and every new target market may require a fresh review. Many companies lack both the resources and the systems to perform these assessments on an ongoing basis. As a result, compliance checks become reactive rather than systematic, while ECHA’s restriction process continues to evolve.
The previous four risks all point to the same underlying issue. Companies that do not manage product data in a structured way cannot reliably demonstrate REACH compliance or meet their documentation obligations.
Safety Data Sheets (SDSs) must be kept up to date and version controlled. Downstream users and customers are entitled to request information about the substances contained in products. Regulatory authorities may also request this information as part of market surveillance activities. Companies that rely on PDF collections stored on file servers, substance data scattered across ERP systems and supplier information buried in email inboxes cannot respond quickly or reliably.
Not because their products are necessarily non-compliant, but because the required data foundation is missing. The Digital Product Passport will only increase this pressure. The connection between substance data, product data and supply chain data is becoming increasingly important. Companies that fail to establish a structured approach today are likely to face much greater pressure to do so tomorrow.
Compliance risks rarely arise because companies ignore the Regulation. They arise because substance data, ingredient data and product data are spread across too many systems to be managed consistently.
Companies that want to address these five risks at their source need a centralised data foundation. Product data, substance data, Safety Data Sheets (SDSs) and supplier information should all be managed in one place, rather than across parallel systems alongside ERP platforms and Excel spreadsheets.
This is exactly the role of a Product Information Management (PIM) system. It enables manufacturers to store substance compositions, SVHC status and Safety Data Sheet references directly with each product, maintain a complete change history and respond systematically to updates of regulatory lists. For manufacturers with complex product portfolios, this is more than an efficiency measure. It is the foundation of reliable, auditable REACH compliance.
Digital Product Passport Software is coming: Learn why Digital Product Passport Software will become essential for compliance, transparency, and product data management. Here’s how you can prepare your business for the ESPR.
REACH is the European Union’s chemicals regulation (EC) No. 1907/2006. It governs how chemical substances, mixtures and articles may be manufactured, imported and placed on the market within the EU. Its objective is to protect human health and the environment from hazardous substances. Companies must register relevant substances with the European Chemicals Agency (ECHA) and communicate substance information throughout the supply chain.
REACH applies to manufacturers, importers and supply chain partners, as well as downstream users that use chemical substances in their production processes. It also applies to manufacturers whose products contain Substances of Very High Concern (SVHCs) at concentrations above 0.1% weight by weight.
SVHC stands for Substances of Very High Concern. These substances are included on ECHA’s Candidate List. Companies supplying an article that contains an SVHC above the 0.1% weight-by-weight threshold must inform recipients and provide this information upon request.
Annex XIV lists substances that require authorisation. After their respective sunset dates, these substances may only be used with authorisation from the European Commission. Annex XVII of the REACH Regulation sets restrictions on the manufacture, use or placing on the market of certain hazardous substances. Both annexes are updated regularly.
A Product Information Management (PIM) system centralises product data, including substance compositions, SVHC status and Safety Data Sheets (SDSs), in a single location. Instead of distributing information across ERP systems, Excel spreadsheets and email, all data is managed in a structured and version-controlled environment. This enables systematic comparison against regulatory lists and allows companies to respond quickly and reliably to compliance requests.
Compliance risks rarely arise from indifference. They arise because manufacturers often lack the data foundation required to meet a Regulation that depends on complete, up-to-date and supply chain-wide product data.
The first step is an honest assessment of your current situation. Which substances are contained in which products? Is this data centralised, structured and up to date? If the answer is no, that is where the real need for action lies.
Dominic Vieregge
Director Service Operations
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