EU Proposed Restriction on PFAS

Summary 

On 7 February 2023, the European Chemicals Agency (ECHA) published the most far reaching and controversial proposal for an EU REACH Restriction to date, covering the manufacture and use of PFAS (per- and polyfluoroalkyl substances). It has been prepared by Denmark, Germany, the Netherlands, Norway and Sweden in the last two years.

The Proposed Restriction covers approximately 10,000 substances, based on elements of their structure. It is essentially a total ban of all uses of PFAS, with only a few temporary derogations from the draconian approach envisaged. The impact on industry in the EU will be enormous.

It is important that companies producing or using PFAS assess whether, and to what extent, their uses may be subject to a derogation and prepare to defend their interests, throughout the 6 months consultation process that will start on 22 March 2023 and then throughout the decision-making process.

The alleged concern

In short, the alleged concern behind the Proposal is that all PFASs and/or their degradation products (within the scope of this restriction proposal) exceed “by far” the criterion for being ‘very persistent’ (vP) (Annex XIII of the REACH Regulation). They would persist in the environment longer than any other man-made chemicals. Further supporting concerns identified in the Proposal are the bioaccumulation, mobility, long range transport potential (LRTP), accumulation in plants, global warming potential and (eco)toxicological effects of certain PFAS. PFASs enter the environment via emissions during their manufacture, use, and at the waste stage.

However, the above is largely based on unsubstantiated assumptions, simplifications and extrapolations that should not pass a detailed scrutiny. PFAS is a large, highly varied class of chemicals with significantly divergent chemical and physical properties. It is not the case that all PFAS are 'vP'. Some PFAS may be considered to be ‘persistent’ (P) as opposed to vP. Also, persistency alone should not suffice as the basis for a restriction as it is not a hazardous property on its own. The other concerns identified in the Proposal are based on evidence that is scarce, inconsistent, questionable and certainly not applicable to all PFAS substances. Thus, the Proposal would ban PFAS on the basis of mainly a "persistency concern" without a proper demonstration that each and all of them present an unacceptable risk. Therefore, it does not meet the criteria for a lawful restriction under Article 68.1 of REACH.

PFAS falling within the scope of the Proposal are defined as “[a]ny substance that contains at least one fully fluorinated methyl (CF3-) or methylene (-CF2-) carbon atom (without any H/Cl/Br/I attached to it)” with a few exceptions. This definition encompasses more than 10,000 PFAS, including a few fully degradable PFAS subgroups. According to the 5 Member States involved, such a broad scope is needed in order to avoid regrettable substitution of one PFAS by another PFAS (which may not even be engineered or exist yet).

This definition is aligned with the OECD definition of PFASs that was published in 2021, but fails to mention or consider that such a definition was declared by the OECD to not be suitable for regulatory purposes. The scope of a PFAS restriction based on the OECD definition from 2021 is too broad to enable effective, science-based risk assessment and regulation of these chemical compounds as an entire group. OECD clearly stated that PFAS is a broad, general, non-specific term, which does not inform whether a compound is harmful or not or whether it presents a potential risk or not. The OECD definition of PFAS was also not intended or designed to be used for regulatory action.

Also, contrary to existing custom and practice, and to the wording in REACH itself, the names (and substance identifier codes e.g. CAS, EINECS and/or EU numbers) are not specified. This could result in an unacceptable degree of uncertainty for manufacturers and users of some substances.

Restriction at the source

The Proposal addresses the alleged ongoing, uncontrollable emissions at source, by banning the manufacture and use of PFAS instead of applying ‘end-of-pipe’ solutions. ‘End-of-pipe’ solutions are considered not to be sufficient or achievable as PFAS are claimed to be ubiquitous, as they are present in such a wide range of products intended for industrial, professional and consumer uses.

The advantage, according to the Proposal of a broad Restriction, is that it can cover a wide range of uses and can address the risks arising from the manufacture and use of the substances as such as well as in other substances, in mixtures and in articles, including imported articles from outside the EU. A Restriction is therefore seen as the most appropriate and effective option to adequately control such a large and complex group of substances which are used in numerous applications.

A ban of most uses of PFAS with some limited derogations

The Proposed Restriction is essentially a total ban of all uses of PFAS, with only a few exemptions and some temporary derogations from the draconian approach envisaged.

Two restriction options (ROs) are addressed in the proposal. A full ban with no derogations and a transition period of 18 months (RO1), and a full ban with use-specific time-limited derogations (18 month transition period for all the PFAS covered plus either a five or 12 year derogation period for some uses) (RO2). It is noteworthy that only two ROs (of many possibilities) are considered in the Proposal, both of which may be considered to be at the ‘extreme’ end of the spectrum. 

The Proposal includes some time-unlimited, more general derogations, e.g. for PFAS used as active substances in Plant Protection Products (PPP), Biocidal Products (BP) and human and veterinary Medicinal Products (MP), as they are addressed under their respective sectoral pieces of legislation.

The proposed derogations (in RO2) cover particular applications in specific sectors, such as in textiles for personal protective equipment, for specific industrial uses such as filtration, as refrigerants, cleaning fluids, additives to hydraulic fluids, lubricants and insulation gas in very particular applications. A different set of derogations is provided for fluoropolymers and perfluoropolyethers for 6 particular uses, including some medical devices, industrial and professional food production, in proton-exchange membranes in duel cells and in the petroleum and mining industries. 

Finally, the Proposal also identifies a number of uses for which a derogation could be warranted, but for which the evidence base is allegedly weak. It does not specify however what evidence is missing and should be provided by industry to confirm these derogations. It is anticipated that the information needed will be clarified at the start of the formal consultation period.

The scope of the derogations, in RO2, are very limited and unlikely to be sufficient to ensure the continued supply of PFAS which are essential for uses which are central to the achievement of key EU objectives. Also, even if some uses of PFAS are subject to the proposed derogations, it is possible, even likely, that EU industry will stop producing them, as the market will not be sufficient to justify the necessary investment. This could have largely unforeseen yet important impacts on, for example, the need for EU supply chain autonomy.

The derogations included in RO2 are largely based on the information provided to the Member States during the calls for evidence. It is likely that some sectors were unable to provide sufficient input in due time, in part because it was not clear exactly what information the authorities needed.

Suitable alternatives do not exist

The proposal assumes that alternatives are available or will become available in time. This is by no means certain.

The Proposal accepts that specific information on costs of a ban of PFASs for the different actors associated with the uses considered is scarce and mainly qualitative, and that there is a lack of evidence as to the availability and applicability of alternatives to PFAS – See Annex F. But that has not stopped the Member States and ECHA from moving forward with the Proposal.

In light of the accepted lack of evidence in many respects, there needs to be a mechanism to, for example, extend derogations in good time. If there are no suitable alternatives for some uses will there be a process to allow derogations to be extended? Will the EU use its research budget to help in the development of suitable alternatives? As mentioned above, for some sectors/uses the market is not large enough to support research towards the development of alternatives. Will these sectors/uses just be allowed to disappear?

Impact

The Proposed will have an enormous impact on industry in the EU and may also severely impact the achievement of key EU objectives.

The impact assessment of the proposed restriction, whilst voluminous, has many uncertainties and, some would argue, inaccuracies. Bearing in mind the importance of this restriction and ‘getting it right’ it is important that the impact assessment is refined over time as and when new information comes to light.

The implications of such a broad-based restriction, covering a group of substances which have many, varied and important uses, is largely a matter of conjecture. This is a huge risk for the EU. The implications over the next ten years or so to the achievement of key EU objectives could be catastrophic or it may lead to the EU being a global leader in the development of high-performance alternatives to PFAS. Bearing in mind the range of possible impacts it is vital that there is an effective feedback mechanism so that the restriction, derogations and deadlines can be adjusted in light of the actual (and better prediction of future) impacts to make sure that the costs do not outweigh the benefits.

Legal Concerns

In addition to the concerns, already indicated above, the Proposed Restriction raises a number of other legal concerns that would need to be redressed to avoid a flurry of legal cases once the Proposal is transformed into a final legal text:

1. Restricting PFAS without a listing of the chemical substances subject to the restriction is contrary to Article 68.1 of REACH and the principle of legal certainty.
2. The Proposed Restriction may be seen as a "de facto" application of the Precautionary Principle, but could not be lawfully based on such a principle, since it does not respect the requirements set out by the Court of Justice of the EU and the European Commission for the application of this principle.
3. The Proposed Restriction is disproportionate, notably as regards societal costs, thus in breach of Article 68(1) of REACH and the Proportionality Principle.
4. The Proposal is not enforceable in many respect and as a results breaches the principle of legal certainty.

Conclusions

The proposed PFAS Restriction is unprecedented in its scope and ambition. Whilst there may be widespread agreement that the emissions of certain of the thousands of different types of PFAS need to be minimised, the ‘total’ ban being proposed with few derogations risks causing massive impacts on the EU chemicals and downstream industries and may be highly detrimental to the achievement of key EU objectives.

Companies are advised to consider in depth what the Proposal might mean for their manufacturing and use profile. As far as possible, both qualitative and quantitative information on the impact on industry and, in particular, individual PFAS and uses should be provided to the 5 Member States concerned once the consultation period starts. Advocacy activities with ECHA and the European Commission are also needed. In addition, industry should consider the scientific justification in the Proposal and challenge, as appropriate, the conclusions reached, many of which seem to be based on unsubstantiated assumptions.

There is a long way to go in the regulatory process before the proposal becomes a reality in some form or another. Companies need to act quickly to identify data gaps and errors in the Proposal and explain, supported wherever possible by ‘concrete’ evidence, the failings in the Proposal and the implications the Proposal will have. The Member States' dossier submitters, ECHA and eventually the European Commission will be legally obliged to take into account all such "facts and circumstances" to justify their decision and demonstrate that a given use of a given PFAS represents an unacceptable risk, taking into account the socio economic impact of the restriction, including the availability of alternatives.

This will hopefully allow the continued use of certain PFAS if it is not demonstrated that they present an unacceptable risk and/or pave the way for a successful legal challenge in the future, if that is the only remaining option. The ruling of the General Court in the TiO2 Case ((T-283/20) shows that a legal challenge can be successful. Companies should also not hesitate to seek legal support in making their representations to authorities, not waiting for the final restriction to be adopted.

How we can help

Mayer Brown's EU Regulatory team has extensive experience in chemical control matters. We work with a broad range of companies, industries and trade associations to stay abreast of legislative changes and to devise response strategies to regulatory challenges. In particular, we have a successful track record before the European Courts and the ECHA Board of Appeal, in challenging European Commission decisions to ban, restrict or classify chemical substances and ECHA Dossier and substances evaluations when they infringe EU legal principles and EU regulations, including the EU REACH and CLP Regulations. We won landmark cases, including Case T-584/13 where the General Court annulled the prohibition of the pesticide Fipronil; Case T-283/20 where the General Court annulled the European Commission's 2020 decision that classified titanium dioxide as a category 2 carcinogen by inhalation in certain powder form; as well as the CTC case A-005-2014 which defined the boundaries between dossier and substance evaluation under REACH and established the substance evaluation threshold to meet by ECHA.

Our team stands ready to advise on the practical implementation and potential implications of the Proposed Restriction on PFAS.