Retailers say chemical producers and distributors must share regulatory burden

A row has been simmering in the EU over how much retailers and manufacturers should share responsibility for ensuring chemical products sold to the public – including cosmetics, garden fertilisers and swimming-pool cleaners – are not used to produce home-made explosives.

At its heart is a draft regulation that would make retailers responsible for restricting sales of certain chemical products and monitoring sales of others. After four years of negotiation, the draft is now due to be made law in a full session of the European parliament in November. But retailers are likely to ensure that the debate continues by pushing member states to moderate the regulation as it is applied at the national level.

The regulation comes in response to the bombings in Madrid and London in 2004 and 2005, which involved bombs made from chemical products sold on the high street. It refers to two groups of chemicals. The most hazardous, listed in Annex I, include hydrogen peroxide, nitromethane, nitric acid, potassium chlorate and ammonium nitrate. Annex II contains chemicals such as hexamine, sulphuric acid, acetone and potassium and ammonium calcium nitrate.

Retailers will only be allowed to sell Annex I products above a certain concentration to consumers who have a licence or, in the case of hydrogen peroxide, nitromethane and nitric acid, when sales are registered. Annex II chemicals can continue to be sold to consumers, but retailers and wholesalers will be obliged to report to the authorities any ‘suspicious transactions’, defined as sales for which there are ‘reasonable grounds for suspecting that the substance is intended for the production of home-made explosives’.

Information flow

Chemical producers and distributors are broadly satisfied with the regulation because it restricts security issues to the point of sale to consumers. Producers and distributors are already complying with separate EU legislation covering bulk fertilisers and illicit drugs. But retailers are unhappy with the regulation because, they claim, it puts an unfair burden of responsibility on them. Retailers will be obliged to label appropriately products containing chemicals that might pose a security risk in relation to explosives. But producers and distributors do not have to pass on information relating directly to such security risks – although other regulations oblige them to pass on information about risks to human health and the environment.

It is only common sense to say that the producer, importer or distributor of a substance which could be an explosives precursor is the person who knows about its composition

‘Under the regulation, the last player in the supply chain – namely the retailer – is being told to take on the responsibility of labelling the product without knowing the composition of the substance or mixture,’ says Christelle Davidson, environmental and logistics advisor at Eurocommerce, the European trade association for retailers. ‘It is only common sense to say that the producer, importer or distributor of a substance which could be an explosives precursor is the person who knows about its composition,’ she continues. Eurocommerce argues that the regulation contradicts EU principles on the marketing of products, agreed in 2008, that manufacturers, importers, distributors and other economic operators should ensure the legal compliance of products ‘in relation to their respective roles in the supply chain’. Davidson says: ‘Retailers cannot take on the responsibilities of a producer or importer in this area because they don’t have the knowledge to do so.’

Eurocommerce originally pressed for the precursors to be brought under the Reach (registration, evaluation, authorisation and restriction of chemicals) regulation, which restricts sales of ammonium nitrate to consumers. But this was rejected during negotiations on the grounds that the Reach regulation deals only with environmental and health issues and not security issues.

‘The basic principle behind [the Reach regulation] is that information about hazardous chemicals should be passed down the supply chain,’ says Davidson. ‘But somehow this principle cannot be applied to substances with which there are security issues.’

Once the regulation is approved at the EU level, member states have 18 months to put it into effect. Eurocommerce is aiming to continue its fight by encouraging national retail associations to lobby national governments to make additions to the regulation before it is placed on their statute books. Member states can attach additions to regulations in a process called ‘goldplating’.

But René van Sloten at Cefic, an European organisation representing the interests of the chemical industry, warns this divergence would undo the whole point of the exercise, namely harmonisation: ‘There will be an obligation on producers and distributors in one country but not in others. The same rules should be applicable everywhere.’