ILMA Compoundings May 2017 - 15

yet begun. If this first batch of PEC substance registrations
remains unaffected, then companies that have not yet begun
this process will need to begin without delay.
If MOE confirms that the initial batch of PEC substances
are part of the 7,000 preregistration substances, it might
adjust the timetable for registration based on the different
tonnage bands that are being considered. This approach
would preserve the investment made by the current list of
joint filers and afford extra time to those companies that
have not yet started.
Management of substances subject to authorization will
be adjusted (Article 25 of K-REACH) to not only include
the publication of chemical uses that are subject to authorization, but also include publication of chemical uses that are
exempt from authorization. Once the changes are made, substances with a use that isn't included as subject to authorization or exempt from authorization will be prohibited entirely.
Hazard information communication will be strengthened
and broadened (Article 29 of K-REACH) to require that hazardous chemical information such as name, hazard, risk and
safe-use information - regardless of quantity, content (if contained in a mixture) and registration status - be provided to
downstream users. This change will be unsettling for exporters
to Korea if the final version undermines the ability to protect
confidential information. Nevertheless, it would be consistent
with the initial K-REACH legislation, which requires loss of
confidentiality concerning hazardous substances.
The scope of products requiring notification because
of their hazardous substance content will be expanded
(Article 32 of K-REACH) consistent with strengthening and
broadening hazard information communication. Currently,
K-REACH requires products with toxic chemical substances, substances subject to authorization, restriction and

prohibition, to be notified at the product level. The anticipated increase in scope would add similar notification
requirement for products that contain carcinogenic, mutagenic or accumulative substances.
New penalty provisions are intended by adding a second
paragraph to Article 37 of K-REACH. Among them will
be fines and penalties against manufacturers, importers and
sellers of unregistered chemicals that cause any manner of
harm to human health or the environment. The fines and
penalties are expected to be severe.
IMPACT BEYOND THE OBVIOUS
If MOE's actual changes remain true to those currently
being discussed, the direct impact to industry (importers/
manufacturers and foreign exporters to Korea) will be
meaningful. This will include substantial costs for preregistration and registration of the 7,000 existing substances,
which is a substantial increase in the number of substances
requiring registration as PEC chemicals under the current
law. The highest estimates of the combined three batches of
PEC chemicals topped at an estimated 3,500 substances.
In addition, the costs associated with re-authoring of safety
data sheets (SDS) and increased registration of hazardous
products will not be small.
But the impact will not stop there. The process of continually modifying K-REACH and its infrastructure has
proved to be taxing on the sub-agencies, the IT systems and
the group of Only Representatives (OR). The addition of
KECO this past December and January added significant
rework for OR staffs, substantially delaying the related
approval processes, even to early April.
Coping with the newly rewritten K-REACH will further
stress the resources of agencies, sub-agencies and ORs. Rework of pending matters and delays in approvals alone will
take their toll.
Eggenschwiler is an international trade attorney and
director of Global Trade for Redstone Group LLC.
He can be reached at 614-923-7472 or
jeggenschwiler@redstonegrp.com.

ILMA Compoundings May 2017

Table of Contents for the Digital Edition of ILMA Compoundings May 2017